25 February 2021 13:22

Results as at 31 December 2020: the most difficult year, but with several positive certainties

  • The appeal of IGD’s format confirmed: in the periods when the restrictions were eased the average ticket rose + 17%, retailers’ sales +0.3% better than in 2019[1]
  • Rent collection at around 91% of net turnover in Italy and around 94% in Romania
  • Financial occupancy maintained at high levels: Italy 94.3%; Romania 93.6%
  • Net rental income: €109.5 million (-19.8%); FFO: €59.3 million (-28.8%). Both reflect the net direct impact of Covid-19 for €18.5 million in rent abatements of around 1.7 months’ rent, expensed entirely in the year
  • Cash on hand at the end of the reporting period of around €117 million, in addition to €60 million in committed credit lines and about €151 in uncommitted lines
  • EPRA NAV and NRV at €10.38 p.s. (-8.9%)


  • With a view to reinforcing the financial structure and the investment grade profile, and as no mandatory dividend payment is required given the loss recorded in the year, the BoD has proposed that shareholders not approve distribution of a dividend for 2020;
  • Mandate granted to CBRE, a premiere international advisor, for the disposal of a portfolio of stand-alone hypermarkets/supermarkets for approximately €185 million


  • Corporate Sustainability Report Approved


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Results as at 31 December 2020: the most difficult year, but with several positive certainties (664 KB – pdf)


Bologna, 25 February 2021. Today, in a meeting chaired by Elio Gasperoni, the Board of Directors of IGD – Immobiliare Grande Distribuzione SIIQ S.p.A. (“IGD” or the “Company”) examined and approved the draft separate and consolidated financial statements at 31 December 2020.


Message from the Chief Executive Officer, Claudio Albertini

“2020 was undoubtedly the most difficult year in the Group’ s history, with the severe repercussions of the pandemic weighing on the retail sector and, consequently, on property companies like ours.

We did not, however, remain inert in the face of the situation.  To the contrary, we worked on all fronts with more determination than ever.  To the extent that the law and the protection of health and safety allowed, all of our shopping centers were maintained operational.  The centers were confirmed as points of reference for the communities served and demonstrated great resilience, as well as the ability to react quickly, in the months when the restrictions were eased.  We worked on timely and extensive commercial initiatives with the tenants, providing support which made it possible to maintain high occupancy and rent collection. We also wanted to maintain a financial structure consistent with the investment grade profile, protecting cash flow and safeguarding the resources needed to cover financial needs in 2021. Toward this end, we began working on the disposal of a portfolio of stand-alone hypermarkets and supermarkets which would provide the Company with the financial resources to significantly reduce the LTV. The difficult decision to not distribute a dividend this year is in line with the same reasoning, fully aware that this is an unforeseen choice and that as soon conditions allow, IGD will resume providing its shareholders with the same attractive and sustainable remuneration it has provided in the past”.




In 2020 IGD’s performance was severely impacted by the various restrictive measures adopted by the Italian government, which are still in effect, in response to the Covid-19 crisis.

The Group’s shopping centers recorded positive performances in the first two months of the year (retailers’ sales were up 2.0% at the end of February) but, as the epidemic spread, operations were limited considerably and only stores selling “essential” goods (such as, for example, food products, pharmaceutical and parapharmaceutical items, etc.) were allowed to stay open in the period 12 March – 18 May (a total of 66 days of limitations and closures were recorded).

In the months from June to October there was a gradually easing of the restrictions and a return to almost full operation (though all the social distancing and sanitization measures used in the shopping centers were maintained and organized events and many leisure activities were still not allowed): in this period, the shopping centers showed strong signs of recovery with the retailers’ sales back in positive territory.  The shopper turnout was more cautious but characterized by a greater propensity to consume and a decided increase in the average ticket (+17%).

These dynamics confirm that consumers are still focused on shopping centers and highlight a significant capacity to move quickly once stores could open and foot traffic was allowed.  The validity of IGD’s format was also confirmed: medium sized assets, dominant in their catchment areas, experienced as the ideal place for safe, practical and convenient shopping. IGD outperformed the market thanks mainly to a portfolio comprised of urban centers, with an attractive food anchor, capable of offering a complete range of goods and services under one roof which allows for ample choice while optimizing time.

In the wake, however, of the new surge in infections, beginning on 6 November the government enacted new restrictions which called for, among other things, the closure of all shopping centers on weekends and on holidays (for a total of 21 days in November and December) with the exception solely of “essential” categories which were allowed to operate. These restrictions, along with the limits on movement between cities placed periodically based on changes in infection rates, had a significant impact on the performance of our centers at a time of year that is usually very positive for shopping.

In light of the above, in 2020 the sales recorded by mall retailers were down by around 28% compared to the prior year, which was, however, better than the market average (Source: CNCC); conversely, despite the inevitable repercussions of the restrictive measures implemented (such as, for example, the closure of non-food areas and the limits on movement described above), sales at the Group’s freehold hypermarkets and supermarkets were down only slightly against 2019 (-2.8%).

At the start of the pandemic the Company implemented a series of initiatives consistent with its sustainability policies, beginning with the protection and safety of visitors, shopping center employees and its own employees. As for the mall retailers, one of the categories hit the hardest by this crisis, the Company spoke directly with the tenants in order to determine the best way to provide support during the periods of mandatory closures and compensate for the loss in sales (also taking into account the relief mechanisms implemented by the Italian government).

The tenant negotiations relative to the first lockdown are currently almost completed and the negotiations relative to the November-December restrictions are beginning now.

No changes to existing leases were made as a result of the negotiations (with rare exceptions), while, depending on the specifics of each case, payments were reformulated during the year, lease expirations were extended and temporary discounts were granted.

These measures produced tangible and encouraging results.

The occupancy of the Italian portfolio was maintained at a high level (94.3%), albeit lower than the 96.9% reported at 31 December 2019.

Excellent results were also achieved in terms of rent collection which reached more than 91%[2] at 31 December, net of the discounts granted.

Normal pre-letting continued at the same time as these negotiations which, despite the difficult context, was effective and brought good results: 101 leases (55 renewals and 46 attributable to turnover) were signed in the year at largely stable rents (-0.38%).

IGD’s portfolio, with a couple of exceptions, was not subject to large retailer bankruptcies. Overall, only 5 tenants began bankruptcy proceedings.

There was, however, a considerable difference in the performances depending on the category of merchandise. The demand for home comfort improvement solutions was high, as well as for consumer electronics and personal care products. At the moment restaurants, entertainment and clothing/footwear, however, continue to be penalized noticeably.



In Romania the government measures adopted also limited the operation of the Winmartk malls: between March and May only stores selling merchandise considered essential (food products, pharmaceuticals, veterinarian products…) were allowed to operate.  In the summer the restrictions were then eased, but restaurants and entertainment businesses are still subject to local restrictions based on changes in the infection rates.

All of this affected the operating performance of the Winmarkt shopping centers: occupancy reached 93.6% which, while still excellent, is lower than the 97.6% recorded year-end 2019 including as a result of the exit of a tenant with an extensive store footprint/with multiple points of sale.

With regard to management of the lockdown, IGD opted to grant temporary discounts to the retailers during the two months of mandatory closures; the support provided facilitated rent collection. At 31 December, therefore, rent collection for FY 2020 amounted to more than 94% of the turnover. Normal pre-letting continued during the year and 370 leases were signed (290 renewals and 80 attributable to turnover) at largely stable rents (-0.47%).



In 2020 rental income amounted to €150.0 million, a decrease of -3.4%, explained by:

  • for around -€0.8 million, lower revenue not like-for-like;
  • for around -€4.0 million, lower revenue like-for-like in Italy. The decrease is attributable entirely to malls

due above all to the drop in variable and temporary revenue linked to the lockdown period and the subsequent restrictions; hypermarkets were up slightly;

  • for around -€0.5 million, lower revenue like-for-like in Romania due to lower variable revenue and the exit of a tenant with an extensive store footprint/with multiple points of sale.

Net rental income amounted to €109.5 million, down -19.8% against the same period of the prior year, due above all to the one-off direct impact of Covid-19 (which will not impact subsequent reporting periods) amounting to €18.5 million (including discounts and credit losses, net the savings on rents payable) or approximately 1.7 months in rent abatements.

Core business Ebitda fell 20.6% to €99.4 million, with the margin at 65.4%.  The freehold core business Ebitda margin (relative to freehold properties) came to 65.3%.

Financial charges amounted to €36.2 million; this figure, net of the accounting impact of the last bond issue completed in November 2019 and excluding the negative carry of roughly €3.8 million (linked to the refinancing of future maturities), was 4.7% lower than at 31 December 2019.

Funds from Operations (FFO) amounted to €59.3 million, down with respect to 31 December 2019 (-28.8%), including the one-off provisions made for Covid-19.



Given the difficult environment, during the year IGD deemed it opportune to postpone or cancel a few capex and investments, resulting in a reduction in the budgeted cash-out of circa €40 million.

This decision was made in order to limit the pandemic’s impact on cash flow and maintain a solid and balanced financial structure.

The restyling of the Porto Grande (San Benedetto del Tronto) and La Favorita (Mantua) shopping centers was, therefore, postponed. Work on these two projects, along with the restyling and remodeling of the hypermarket at the Casilino Shopping Center (Rome), will resume in 2021 and should be completed the following year.

Work on Porta a Mare in Livorno and the development of the Officine Storiche section was also suspended, but resumed in the second half of 2020 and currently is expected to be completed by the end of first half 2022.



Consistent with the strategic objective to maintain an investment grade portfolio IGD has granted CBRE, a premiere international advisor, a mandate for the disposal of a portfolio of stand-alone hypermarkets and supermarkets for approximately €185 million.

At the moment this portfolio is of great interest to the market: it comprises assets with good appeal, providing interesting returns to investors, with long-term leases and stable rents.

The proceeds from the transaction will be used to reduce the Loan to Value and bring it to 45% or less as soon as possible.



The market value of Gruppo IGD’s real estate portfolio reached2,265.69 million, a decrease of 4.86% compared to December 2019. More in detail:

  • malls fell 6.43 % (-€101.2 million), with a gross initial yield of 6.53%. The difference is explained by, for around 29%, different DCF assumptions (rates, inflation, ERV) and for around 71%, by changes in cash flow with regard particularly to variable revenue and caps on operating expenses;
  • hypermarkets were basically unchanged, showing a slight drop (- 0.99%), with a gross initial yield of 6.02%;
  • in Romania the value of the real estate portfolio reached €6 million at 31 December 2020, lower than the €150.3 million posted at 31 December 2019, with a gross initial yield of 7.35%.

 Including the leasehold properties, the market value of Gruppo IGD’s real estate portfolio reaches €2,309.01 million.

 The Net Initial Yield, calculated using EPRA criteria, reached 5.3% for the Italian portfolio (5.4% topped up) and 6.0% for the Romanian portfolio (6.2% topped up).

 The EPRA NAV and EPRA NRV reached €1,145.8 million or €10.38 per share.  The figure is 8.9% lower with respect to 31 December 2019.  The change is attributable to the positive contribution of FFO which was more than offset by the reduced dividend approved and the drop in the portfolio’s fair value.

The EPRA NTA came to €10.31 per share, 8.7% lower compared to 31 December 2019

The EPRA NDV came to €10.42 per share, down 3.6% compared to 31 December 2019.



In 2020 the Company worked, above all, on guaranteeing the sustainability of its financial structure and on having the resources needed to cover the financial needs for 2021.

Toward this end, in the first half €60 million in committed credit lines were renewed; an agreement was also signed with Banca Monte dei Paschi di Siena for a 6-year €36.3 million loan, guaranteed by SACE as part of the Garanzia Italia program (at a rate which, including the cost of the government guarantee, is in line with the Group’s average cost of debt).

With regard to IGD’s ratings, given the impact of the Covid-19 outbreak, during the year S&P Global Ratings downgraded IGD’s rating from BBB- to BB+ with a negative outlook, while Fitch Ratings Fitch Ratings Ltd confirmed the investment grade rating of BBB- and changed the outlook to negative.  As a result of this confirmation, the economic conditions of the bond loans remain unchanged.

 Thanks also to the actions on costs, the Company closed the year with cash on hand of €117 million which, as announced on 13 January 2021, will allow for early redemption of the circa €70 million outstanding on the “€300,000,000 2.500 per cent Notes due 31 May 2021”.

In addition to the cash on hand and the €60 million in committed credit lines referred to above, approximately €151 million in uncommitted credit lines are also available.

 The average cost of debt was 2.30% at 31 December 2020 versus 2.35% at year-end 2019, while the interest cover ratio or ICR came to 3.2X[3]  versus 3.8x at 31 December 2019.

The Loan to Value of 49.9% is higher than the 47.6% recorded at year-end 2019 and reflects the €146 million decrease in fair value. The net financial debt was €1,155.5 million, largely unchanged with respect to year-end 2019 (€1,162.6 million).



In light of the loss recorded by the parent company IGD SIIQ SpA (which waives the distribution requirement) and with a view to safeguarding financial stability and the investment grade profile, the Board of Directors has proposed that shareholders not approve distribution of a dividend for 2020, subject to the approval of the financial statements for the year ended on 31 December 2020 and the Directors’ Report on Operations.

This difficult decision is to be viewed as one-off and unforeseen, triggered by the exceptional circumstances that developed as a result of the pandemic; as soon as conditions allow, the Company intends to resume paying dividends and providing its shareholders with attractive remuneration.



The first few months of 2021 will undoubtedly still be difficult for shopping center operations due to the restrictions that are still in place and it is, therefore, plausible that the Company will again be impacted directly and indirectly by the pandemic.

Assuming, however, that an effective vaccination plan will be implemented (which should reduce infection rates, the severity of the virus and result in a gradual easing of the restrictions) and assuming that the economy and consumption gradually improve in 2021, starting in the second half particularly, the Company estimates that FFO will grow between +3% and +4% in FY 2021.

This outlook does not take into account the potential disposal mentioned above.



The Board of Directors approved the Corporate Sustainability Report which was subject to Limited Assurance by PricewaterhouseCoopers which certified compliance with the most important international standards (the GRI Standards).

The report approved takes into account the impact that the Covid-19 pandemic had on both the strategy and the performance.  If overall the strategy is unchanged, partial adjustments were made to its 3 pillars: the material topics, specific sustainability risks, and the short/medium-term targets. Furthermore, due to the restrictions put into place by the authorities, which impacted the shopping centers’ operations, the indicators used to measure sustainability performance in 2020 are, sometimes, hard to compare with prior years.

In 2020 IGD formalized its adhesion to the United Nations’ Global Compact, the world’s largest corporate sustainability initiative.  For this reason, as of the 2020 Corporate Sustainability Report the policies and performances geared to support the Ten Principles of the Global Compact relating to Human Rights, Labor, Environment and Anti-Corruption are also reported on. In the report IGD also addresses the recommendations of the Task Force on Climate-Related Financial Disclosures (TCFD) with regard, specifically, to climate change and related risks.

As of 2017 IGD’s sustainability strategy is summarized in «Becoming Great», which testifies to the Company’s commitment to growth that focuses on the environment (Green), people (Responsible), ethics (Ethical), attractive locations (Attractive), together with its stakeholders (Together). The same titles are also the names of the chapters in the CSR which reports on the company’s performance during the year:

  • Green: invested €1.2 million in improving the energy efficiency of the structures, including the costs for the relamping of a shopping center (a total of 19 centers are now equipped with LED lighting); BREEAM IN USE certification for 3 more key assets (Conè in Conegliano-Treviso, Leonardo in Imola-Bologna and Le Porte di Napoli in Afragola-Naples) for a total of 8 certified shopping centers; reached the goal to obtain UNI EN ISO 14001 environmental certification for 95% of the freehold malls (24 centers are certified, in addition to the headquarters); used renewable energy exclusively since 2017; installed 19 charging stations for electric cars in 10 shopping centers (34 had been installed at 17 shopping centers at the end of 2020).
  • Responsible: number of employees stable; specific measures implemented to prevent the spread of the virus inside the shopping centers (for a total cash-out of around €1.3 million), as well as ensure that employees could work safely; the Corporate Welfare Plan was confirmed for the fourth year, with the participation of 98% of the employees; training activities for all employees continued.
  • Ethical: UNI ISO 37001 certification (“Anti Bribery Management System”), the key international standard for anti bribery management systems. The same certification was also obtained in Romania in 2018. The legality rating was renewed with the highest score (3 stars); the Decree 231/2001 Organizational, Management and Control Model was updated in order to include the new crimes, as well as incorporate the Anti Bribery Management System; the structure and content of the Code of Conduct was revised in order to reflect new company policies and procedures, as well as comply with the law and regulations.
  • Attractive: scouting for new brands continued, resulting in the introduction of 18 new tenants in the Italian shopping malls; the marketing strategy was modified to reflect the continuous changes stemming from the development and spread of the pandemic in order to maintain contact with the community and spotlight promotions; a communication campaign was launched focused on reassuring visitors about shopping center safety and post lockdown supply; IGD’s first digital plan was defined which, beginning in 2021, will strive to systemize existing online tools and identify others in order to use the web to increase contact with visitors, as effectively as possible.
  • Together: structured involvement of the stakeholders was carried out in order to understand their expectations, especially in a complex year like 2020; collaboration with 140 local associations and nonprofit organizations, even though it was impossible to organize meetings and gatherings; the 16,600 jobs offered, the partnerships with 882 local providers and the fact that 42% of the brands present in the malls are local, confirmed IGD’s social role within the community.



Guidelines for the composition of the new Board of Directors

In accordance with the Corporate Governance Code and as the corporate bodies are to be renewed, IGD’s exiting Board of Directors prepared guidelines relative to the future size and composition of the board, also taking into account the outcome of the 2020 Board Review, to be submitted to the shareholders during the Shareholders’ Meeting.

The guidelines also include indications about the professional profile, experience and expertise of the Directors, including in light of IGD’s size and complexity, as well as its business targets and strategic goals.

The guidelines are available as of today on the Company’s website at https://www.gruppoigd.it/en/governance/shareholders-meeting/.


Calling of the Annual General Meeting in ordinary session

IGD’s Board of Directors also resolved to convene the Company’s Annual General Meeting in ordinary session on 15 April 2021, in first call and, if necessary, in second call on 16 April 2021, to resolve on the following agenda:

  1. Separate financial statements at 31.12.2020; Directors’ report on operations; External auditors’ report; Report of the Board of Statutory Auditors; Presentation of the consolidated financial statements at 31.12.2020; related and consequent resolutions. Allocation of the net earnings for the year; related and consequent resolutions.
  2. Report on compensation in accordance with Art. 123-ter, paragraphs 3-ter and 6, of Legislative Decree n. 58/98:

2.1 first section: report on the compensation policy. Binding resolution;

2.2 second section: report on compensation paid. Non-binding resolution.

  1. Appointment of the Board of Directors

3.1 Determination of the number of directors;

3.2 Determination of the Board of Directors’ term of office;

3.3 Appointment of the members of the Board of Directors;

3.4 Determination of the Board of Directors’ remuneration;

  1. Appointment of the Board of Statutory Auditors

4.1 Appointment of the three Standing Auditors and the three Alternate Auditors;

4.2 Appointment of the Chairman of the Board of Statutory Auditors;

4.3 Determination of the Board of Statutory Auditors’ remuneration.


The lists for the renewal of the Board of Directors and the Board of Statutory Auditors must be submitted by 22 March 2021. The lists of candidates may be presented by individual shareholders or groups of shareholders who together hold voting shares representing at least 4.5% of the share capital, as established by Consob in executive order n. 44 of 29 January 2021 relating to the “Holdings needed in order to be entitled to submit lists of candidates for members of administrative and control bodies”.

For further details please refer to the Notice of Call which will be made available starting 5 March 2021 on the company website at https://www.gruppoigd.it/en/governance/shareholders-meeting/.


Assessment of independent status

IGD’s Board of Directors verified,  based on the information provided by the interested parties to the Company that the 7 (seven) independent directors (Luca Dondi dall’Orologio, Elisabetta Gualandri, Isabella Landi, Livia Salvini, Rossella Saoncella, Timothy Guy Michele Santini ed Eric Jean Véron) still qualify as independent in accordance with and pursuant to Art. 148, paragraph 3, of Legislative Decree n. 58/1998, guideline 7 of the Corporate Governance Code and Art. 16 of Consob Regulation n. 20249/2017.


Approval of the Report on Corporate Governance and Ownership Structure and the Compensation Report

The Board of Directors approved the Report on Corporate Governance and Ownership Structure, which forms an integral part of the annual report, as well as, in accordance with the recommendation of the Appointments and Compensation Committee, the Compensation Report, the first section of which, pursuant to Art. 123-ter, par. 3-ter of Legislative Decree. 58/98, will be subject to a binding vote by the shareholders during the next shareholders’ meeting, while, pursuant to Art. 123-ter, par. 6 of TUF, the second section – which refers to the compensation paid –will be subject to an advisory vote during the same shareholders’ meeting.


The documents will be made available to the public – as well as published on IGD’s website

https://www.gruppoigd.it/Governance – at the Company’s registered office, Borsa Italiana S.p.A. and on the authorized storage system www.emarketstorage.com in accordance with the law and applicable regulations.


[1] Figures refer to the period August – October 2020

[2] Calculated based on rents payable net of the temporary discounts and abatements.

[3] Excluding the effects of the last financial transaction; including these effects the figure reaches 2.7X at 31/12/2020