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EANS-Adhoc: Atrium European Real Estate Limited
2016 RESULTS REFLECT CONTINUED
STRONG PERFOMANCE ACROSS THE PORTFOLIO
-------------------------------------------------------------------------------- Disclosed inside information pursuant to article 17 Market Abuse Regulation (MAR) transmitted by euro adhoc with the aim of a Europe-wide distribution. The issuer is solely responsible for the content of this announcement. -------------------------------------------------------------------------------- annual result 22.03.2017 Atrium European Real Estate Limited 2016 RESULTS REFLECT CONTINUED STRONG PERFOMANCE ACROSS THE PORTFOLIO Ad hoc announcement - Jersey, 22 March 2017. Atrium European Real Estate Limited (VSE/ Euronext: ATRS) ("Atrium" or the "Company" and together with its subsidiaries, the "Group"), a leading owner, operator and redeveloper of shopping centres and retail real estate in Central and Eastern Europe, announces its results for the fourth quarter and year ended 31 December 2016. Key Highlights - LFL NRI momentum up 1.8% excluding Russia, driven by portfolio quality uplift - Positive operational results, operating margin at 95.4% and occupancy rate at 96.6% - Profit growth before tax up EUR104m - Strong progress in the redevelopment and extension programme, initiatives to add 70,000 sqm of new GLA by 2020 (7,600 sqm added in 2016), focussed on Warsaw - Major milestone reached in March 2017 with a framework agreement signed to resolve the vast majority of the Austrian legacy issues - Cost saving programme of EUR10m per annum from 2018 onwards in administrative costs as a result of the signing of the legacy arrangement and identified operational efficiencies - A balance sheet well positioned to support future growth Business review - Profit before taxation was EUR72.6m for the year, reflecting an increase of EUR103.5m compared to a loss of EUR30.9m for 2015 - primarily driven by a EUR14.5m revaluation (compared to a EUR104.7m devaluation last year, mainly due to Russia) offset by a EUR20m increase in administration expenses, largely due to higher legacy legal costs and provision - Group NRI was EUR188.8m (2015: EUR197.9m) with EPRA like-for-like NRI of EUR156.6m (2015: EUR160.3m) impacted by a EUR5.9m or 15.0% reduction in income in Russia (Q4 '16: -3.0%) - Group operating margin remained healthy at 95.4% (2015: 96.4%) - Occupancy rate steady at 96.6% (31 December 2015: 96.7%) - Company adjusted EPRA earnings per share was 31.4 EURcents (2015: 33.3 EURcents) - EBITDA, excluding revaluation and disposals, impairments and legacy legal matters was EUR162.2m (2015: EUR174.0m) reflecting the disposal of non-core assets and a reduction in income from Russia - Value of the Group's portfolio of 60 standing investments stood at EUR2.6 billion after strategic portfolio sales (31 December 2015: 77: EUR2.7 billion) - EPRA net asset value ("NAV") per share was EUR5.39 (31 December 2015: EUR5.64 following the payment of a 14.0 EURcents special dividend in September and including three quarterly dividends of 6.75 EURcents - Consistent annual dividend of EURcents 27 per share approved for 2017 with the first quarterly dividend of 6.75 EURcents per share due to be paid as a capital repayment on 31 March to shareholders on the register at 24 March, with an ex dividend date of 23 March 2017 Significant progress with portfolio repositioning during 2016 and into 2017: - Redevelopment and extension programme driving future higher quality cash flow - 7,600 sqm extension at Atrium Promenada successfully completed and opened, with ongoing works to add a further 13,400 sqm - A 8,600 sqm GLA extension has commenced at Atrium Targowek - These Polish projects are part of a wider redevelopment pipeline which will deliver almost 70,000 sqm of new GLA to the Group's portfolio and make a significant contribution to the continued drive for more sustainable income growth - Disposals to further focus portfolio on higher quality assets - Disposal of a EUR102.6m portfolio of ten retail assets in the Czech Republic completed in February 2016, reflecting an 8% premium to fair value - Framework agreement signed in April 2016 for the EUR10m sale of two land plots in Russia - EUR17.5m sale in June 2016 of three smaller Polish assets and the EUR12.5m disposal of Atrium Azur in October 2016, when the Group exited Latvia, both achieved at slightly above fair value, in line with previous disposals Financing transactions provide balance sheet strength and flexibility - Voluntary repayment of a EUR49.5m bank loan in Poland completed in March 2016 - 84% of the Group's standing investments are unencumbered as at 31 December 2016 - EUR17m nominal value of bonds due in 2020 and 2022 repurchased in April 2016 - EUR175m of unsecured revolving credit facilities now available following the signing of a EUR25m increase in Q4 2016 - As at 31 December 2016 Gross LTV and Net LTV were 32.3% and 28.7% respectively. The Company remains conservatively leveraged and well placed to support future redevelopments and growth opportunities as they arise New milestone in resolving legacy issues - In January 2016, the Company announced the resolution of the Dutch litigation and the establishment of a compensation fund which was in place through to October 2016 and resulted in expected compensation payments of EUR11m in respect of some 1,650 submissions (of which Atrium bears 50%) - Major positive milestone reached in March 2017 with a framework agreement to resolve the vast majority of the Austrian legacy issues with a maximum related payment of EUR44m and an increase in the provision by approximately EUR32m. Management changes - Liad Barzilai appointed Chief Executive Officer of the Group as of 23 February 2017, following the resignation of Josip Kardun Commenting on the results, Liad Barzilai, Group CEO, said: "Our results today reflect both the improvement of the portfolio and the strengthening of our balance sheet, which provide the Group with a strong platform for growth in the coming year. "Our redevelopment and extension programme is progressing well and we have a healthy pipeline of opportunities that will help us to deliver higher quality and sustainable income in future years. "Furthermore, the significant progress made towards resolution of our legacy issues and the associated cost reduction, together with cost savings from improved operational efficiencies will add approximately EUR10m of EBITDA annually and put us in a position to look forward positively to the years ahead and creating further value for our shareholders. "Having only taken up the role of CEO in February, I would like to thank my colleagues at Atrium for their contribution to another robust set of year-end results." This announcement is a summary of, and should be read in conjunction with, the full version of the Group's Q4 2016 results, which can be found on the Company page of the Vienna Börse website at http://en.wienerborse.at/ and on the Group's page of the Euronext Amsterdam website, www.euronext.com or on the Group's website at www.aere.com. Further information can be found on the Company's website www.aere.com or from: Analysts: RLee@aere.com Press & Shareholders: FTI Consulting Inc +44 (0)20 3727 1000 Richard Sunderland Claire Turvey Ellie Sweeney email@example.com The Company is established as a closed-end investment company incorporated and domiciled in Jersey and regulated by the Jersey Financial Services Commission as a certified Jersey listed fund, and is listed on both the Vienna Stock Exchange and the Euronext Amsterdam Stock Exchange. Appropriate professional advice should be sought in the case of any uncertainty as to the scope of the regulatory requirements that apply by reason of the above regulation and listings. All investments are subject to risk. Past performance is no guarantee of future returns. The value of investments may fluctuate. Results achieved in the past are no guarantee of future results. Further inquiry note: For further information: FTI Consulting Inc.: +44 (0)20 3727 1000 Richard Sunderland Claire Turvey Richard.firstname.lastname@example.org end of announcement euro adhoc -------------------------------------------------------------------------------- issuer: Atrium European Real Estate Limited Seaton Place 11-15 UK-JE4 0QH St Helier Jersey / Channel Islands phone: +44 (0)20 7831 3113 mail: email@example.com WWW: http://www.aere.com sector: Real Estate ISIN: JE00B3DCF752 indexes: Standard Market Continuous stockmarkets: official market: Wien, stock market: Luxembourg Stock Exchange language: English