7 May 2019 12:13

The Board of Directors approves the results as at 31 March 2019

Bologna, 7 May 2019. Today the Board of Directors of IGD – Immobiliare Grande Distribuzione SIIQ S.p.A. (“IGD” or the “Company”) examined and approved the interim financial report at 31 March 2019 during a meeting chaired by Elio Gasperoni.

  • Net rental income: €2 million, +17.9% (+9.2% adj ex IFRS16[1]);
  • FFO: €8 million (+13.4%)
  • Malls LFL Italy flat, Romania + 2.4%; upside on renewals: Italy +4.1%; Romania +10.3%
  • Loan-to-Value 46.2% ( 45% adj ex IFRS16); Interest cover ratio 3.9x (around 3.7x adj ex IFRS16)



Gross rental income rose +8.7% to €38.8 million. The change reflects:

  • like-for-like growth in Italy which was flat with malls down slightly (-0.4%) and hypermarkets showing a slight increase (+0.4%); inflation had an impact of around 77 bps;
  • higher revenue not like-for-like of around €3.1 million linked to the opening of the Gran Rondò mall extension in Crema and the new portfolio purchased from Eurocommercial on 18 April 2018
  • higher revenue like-for-like in Romania of around €0.1 million (+2.4%).

Net rental income amounted to €34.2 million, an increase of 17.9% against the same period of the prior year, while the adj figure ex IFRS 16 comes to +9.2%.

Net revenue from services came to €0.2 million, up slightly compared to the prior year.

Core business Ebitda amounted to €31.2 million, an increase of 17.6% compared to 31 March 2018 (+8.0% adj ex IFRS16). The core business Ebitda Margin amounted to 77.3%, while the recurring freehold Ebitda margin (relative to freehold properties) reached 79.5%.

Financial expense adj ex IFRS16 fell (-3.9%) to €7.6 million: the result is attributable to the recent liability management activities, namely the repayment of the bond for around €125 million (cost 3.875%) in January and the €200 million unsecured senior facility contracted at a cost of around 2.1%[2].

The downward trend in the average cost of debt continued (coming in at 2.42% vs 2.7%); ICR reached 3.9X (3.7x adj ex IRFS16)

The Group’s portion of net profit amounted to €18 million in the reporting period, higher than in the same period 2018 (€ 16.7 million) +8.0%.

Funds from Operations (FFO) rose 13.4% compared to the first three months of 2018 to €20.8 million. The Group confirms the FY2019 growth target of +6/7%, disclosed when the results for FY2018 were approved, and plans on providing an updated outlook when the results for the first half are approved.

The IGD Group’s net financial debt came to €-1,148.6 million, (€-1,088 million adj ex IFRS16), higher than in March 2018 (€-1,049 million). The Loan-to-Value reached 46.2% (45% adj ex IFR16) and the gearing ratio 0.89x (0.85x adj ex IFRS16)



As for the tenant sales, after a slightly improving January and a decreasing February and March, the quarter closes almost steadily with respect to the same period of the previous year.

Footfalls were down by 6.2%, in line also with CNCC (Consiglio Nazionale dei Centri Commerciali) figures, but recovered in April (+3.2%). Sales and footfalls were affected mainly by weather conditions (particularly a very hot February) and the calendar effect linked to the Easter holidays which were in mid-April in 2019 versus end of March in 2018.

Pre-letting generated very positive results, with an average upside in Italy of +4.1% (excluding Centro Sarca’s renewal of the multiplex cinema) on 39 turnovers and 59 renewals, while in Romania upside of 10.3% on 62 turnovers and 41 renewals was recorded.

Average occupancy in Italy was down at 96.6% and in Romania (96.8%).



The new accounting standard IFRS 16 “Leases” (hereafter “IFRS 16”) was applied beginning on 1 January 2019. This new standard supersedes IAS 17 “Leasing” and its interpretations and eliminates the distinction between operating and finance leases in the lessee’s financial statements; for all leases with a term of more than 12 months, the lessee is required to recognize a right-of-use asset and a liability representing its obligation to make lease payments.

The right-of-use asset will be recognized as investment property under property, plant and equipment and, in accordance with IFRS 16 and IAS 40,  its fair value will be appraised by independent experts at the close of every financial period. Changes in fair value will be recognized in a separate equity reserve during the transition to the new standard, and subsequently under “Fair value changes” in the income statement.

The income statement no longer includes the rents payable on leasehold properties, but does show higher fair value adjustments and, in part, higher financial charges.


 [1] Adj ex IFRS16: for the sake of comparability, the 2019 figure was restated excluding the impact of IFRS 16 application
[2] Effective cost based on hedging over 3-years + estimate for the next two years