MERLIN PROPERTIES: 9M'19 RESULTS (ANÃLISIS BANCO SABADELL)
3Q'19 vs. 3Q'18 ResultsGross Rental Income: € 132.2 M (+3.4% vs. +2.3% expected);
Recurring EBITDA: € 106.6 M (+4.9% vs. +3.4% expected);
FFO: € 79.8 M (+11.1% vs. -16.0% expected);
9M'19 vs. 9M'18 Results
Gross Rental Income: € 394.9 M (+6.4% vs. +6.0% expected);
Recurring EBITDA: € 317.0 M (+7.0% vs. +6.4% expected);
FFO: € 237.0 M (+11.4% vs. +2.3% expected);
The company has released 9M’19 results that were slightly above our expectations, although this is due to differences in the scope of consolidation that led to a larger increase in rental income than expected. Adjusted for this effect, rental income and EBITDA would be in line with our estimates, with LfL rental income rising +4.8% (vs. +5.7% as of 1H’19).
By type of asset, the Office segment has shown very strong growth in LfL rental income (+8%) thanks to the improved occupancy rate and positive spreads in new contracts/renewals, Net Leases (mainly BBVA branches) grew +3%, Shopping Centres +3% and Logistics +2% (here we see a slowdown vs. 1H’19, which grew +6%). We still see positive spreads (and stable vs. 1H’19) in new contracts/renewals (+6% in offices, +2% in shopping centres and +5% in logistics). This is a solid leading indicator of future rents, and thus we expect to continue to see healthy growth in LfL rental income over the coming quarters. The occupancy rate rose +27bps vs. June’19 to 93.2%.
Adjusted EBITDA grew +6% (excluding LTIP) and FFO +11.5% to € 0.50/sh., and thus the company is on track to beat its guidance for the full year (€ 0.60/sh.).
There is no asset appraisal in 3Q’19, and thus NAV stands at € 15.27/sh., very similar to June’19. The YoY NAV change is +6%. We do not expect these results to have a big impact, partly due to the fact the company held an Investor Day only a month ago, and thus there is nothing really new. BUY. Target Price: € 15.79/sh (upside 22.88%)
Merlin Properties SOCIMI SA is a Spain-based company engaged in the operation of a real estate investment trust (REIT). The Company focuses on the acquisition, management and rental of commercial properties located in the Iberian Peninsula, primarily in Spain. The Company's activities are divided into the following segments: Office buildings, operating a portfolio of office space; High-street retail, engaged in leasing retail stores; Shopping centers, engaged in managing department stores; Logistics, operating logistics warehouses and distribution centers, and Others. The Company's other activities include property management services rendered to third parties.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.