- Retailer sales and shopping centre footfall satisfactory in
France, fair in Italy and down in Spain
- Well-oriented operating activity
- Covid-19 negotiations with tenants well-advanced; collection
rate satisfactory
Regulatory News:
“Amid a critical health context, Carmila's (Paris:CARM)
satisfactory performances in the third quarter of 2020 once again
underline the high-quality positioning of its leading local
shopping centres. Carmila's teams have provided sustained support
for retailers, with individual tenant negotiations designed to
facilitate business recovery in the best possible conditions. The
Group's leasing and sales activity has been encouraging, and with a
level of debt among the lowest in the industry, Carmila's financial
position is healthy and solid. We must however remain vigilant
given the recent developments in the overall health situation in
the three countries in which we operate,” commented Alexandre de
Palmas, Chairman and Chief Executive Officer of Carmila.
1. Leasing activity
for the first nine months of 2020
In thousands of euros 30 September 2020 30 September
2019 % change 2020/2019
Gross rental income
250,361
268,452
-6.7%
Net rental income
226,828
250,851
-9.6%
France
150,641
168,563
-10.6%
Spain
62,800
65,602
-4.3%
Italy
13,387
16,686
-19.8%
Carmila's net rental income for the first nine months of 2020
came out at €226.8 million compared with €250.9 million over
the same year-ago period, representing a year-on-year decrease of
9.6%.
Main health crisis impacts reflected in the financial
statements at 30 September 2020
Carmila has waived the second-quarter rents of small
businesses (“TPE”) in France at the request of the
government. The full impact of the loss was recognised in gross
rental income at 30 September 2020 in the amount of €10.5
million. For the other tenants, negotiations are ongoing for
specific rent abatements in light of the government-ordered
closures. For agreements signed as at 30 September
2020, rent abatements granted without concessions have been
recognised in the financial statements (negative €1.4 million
impact in third-quarter 2020) and rent-free periods granted in
exchange for lease extensions are being amortised over the residual
term of the lease (negative €0.5 million impact in
third-quarter 2020). The additional adverse impact on 2020
gross rental income in the fourth quarter of Covid-19 rent
abatements currently being negotiated as at 30 September 2020, or
for which the associated legal agreements are in the process of
being finalised, is expected to be between €16 million and €20
million. Allowances for variable rents have also been adjusted
downwards (negative impact of €3.8 million) and allowances for
irrecoverable receivables have been set aside (negative impact of
€4.0 million).
2. Retailer
trading
Retailer sales and footfall
Compared with the third quarter of 2019, Carmila's shopping
centres saw their average footfall drop 12.5% in
third-quarter 2020 (down 8.8% in France, 20.6% in Spain and 23.5%
in Italy). However, their locations within the heart of the regions
helped them to outperform the sector* by almost 5 percentage
points in France and Spain over the period.
Retailer sales saw a contained 6.5% decline over the
period (slight declines of 2.4% in France and of 2.5% in Italy,
and a steep 18.7% drop in Spain). The Ready-to-wear segment was up
by 1.7% in France, but fell back in Spain (down 20%) and Italy
(down 5.2%). Household Furnishings maintained its strong recovery
in all three countries (up 14.1% in France, 4.7% in Spain and 13.2%
in Italy).
Update on Covid-19 negotiations with tenants
Since the start of the pandemic, Carmila has worked tirelessly
to support its retailers, suspending all second-quarter 2020 rents
and charges and deferring payment dates to 30 September 2020 in
France and Italy, and to 30 June and 31 July in Spain.
Besides waiving three months’ rent for small businesses (“TPE”)
in France, Carmila also initiated individual negotiations with its
3,700 other retailers in the Group's three countries, granting
individual relief based on the concessions agreed by the tenants
(e.g., lease term extensions or renewals, or the signing of new
leases).
To date, finalised negotiations represent 48% of gross rental
income in France, 68% in Spain and 70% in Italy. Negotiations and
the finalisation of the associated legal agreements will continue
at least until the first quarter of 2021.
Based on the concessions agreed, the total impact of the
rent-free periods granted remains contained, representing a
rent-free period of around 1.7 months in France, 1 month in Spain
and 1.5 months in Italy.
Ongoing negotiations with tenants have resulted in
satisfactory collection rates in all three countries, which are
continuously improving.
Collection rate
In France, the collection rate for third-quarter
rents (quarterly rent invoiced and payable on 1 July 2020)
stood at 85%, 94% of which was for signed negotiations. For
second-quarter rents (quarterly rent invoiced and payable on 30
September 2020), the collection rate was 61%, 75% of which was for
signed negotiations. Continuing negotiations over second-quarter
rents temporarily weighed on the collection rate for
fourth-quarter rents (quarterly rent invoiced and payable on
1 October 2020), which stood at 58%, 86% of which was for signed
negotiations.
In the Group’s three countries, the average collection
rate for third-quarter rents (quarterly rent invoiced and
payable on 1 July 2020 for France, monthly rent invoiced in advance
for Spain and Italy) stood at 78%, 92% of which was for signed
negotiations. For second-quarter rents (quarterly rent invoiced
and payable on 30 September 2020 for France, monthly rent invoiced
in advance for Spain and Italy), the collection rate was 63%, 77%
of which was for signed negotiations. Negotiations over
second-quarter rents temporarily weighed on the collection rate for
fourth-quarter rents (quarterly rent invoiced and payable on
1 October 2020 for France, monthly rent invoiced in advance for
Spain and Italy), which stood at 61%, 82% of which was for signed
negotiations.
3. Operating
activity in third-quarter 2020
Uninterrupted leasing momentum across all three
countries
In the Group’s three countries, leasing activity remained brisk,
with 98 new leases signed, on a par with the same year-ago
period.
Ten new retailers to open at the Bay 2 shopping centre before
the end of 2020
The Bay 2 shopping centre (in Collégien, Seine-et-Marne)
confirmed its appeal to retailers and customers thanks to the
energy and hard work of the centre’s teams.
Despite the health crisis, operating activity in the centre
proved robust:
- seven new retailers have opened their doors since the start of
the year (Nouvelle Literie, Bonobo, Maison 123, Karenza, Le Repaire
des Sorciers, Borgan Couture and Cache-cache);
- three other projects are planned, including the opening of
Danish retailer Normal, a first for the Seine et Marne region;
- the centre’s longstanding retailers (Jeff de Bruges, SFR,
Valège and Courir) are to revamp their stores in line with their
latest concepts.
Marquette, a concept store for French digital native vertical
brands
At the Labège 2 shopping centre in Toulouse, Carmila joined
forces with Digital Native Group to open Marquette, its first
concept store. Marquette is dedicated exclusively to Digital Native
Vertical Brands (DNVB).
This unique space gives some of France’s most on-trend labels
(My Jolie Candle, Faguo, Cabaïa, Nooz, Les Miraculeux, Merci Handy
and Le Chocolat des Français) a showroom of close to 300 sq.m. to
display their best-selling online products. This collaborative
brick-and-mortar store concept proposes a wide range of cosmetics,
ready-to-wear, accessories, confectionery, wellness and other
products, and aims to bridge the gap between physical and online
retail. The new store thereby provides these popular online brands
with the opportunity to raise their profile.
Business generated through pop-up stores continues to
grow, buoyed by the signing of 15 new leases.
Through its local digital marketing strategy, Carmila
continues to help its retailers grow sales by increasing the
visibility of their products and latest developments in the
vicinity of its shopping centres:
- initiatives targeting retailers were rolled out at the busy
start of the school year in France, for example, and to help boost
attendance at cinemas in Spain;
- digital services on the Kiosque platform helped ensure
successful launches of omni-channel initiatives in the Group’s
three countries (enhanced customer database and digital solution to
streamline administration for new retailers).
Business development: Carmila continues to support its
talented, dynamic retailer partners in developing innovative
concepts
To boost the products and services on offer in its centres and
provide customers with the renewed offerings that they expect,
Carmila has granted financial aid to retailer partners, including
barbers La Barbe de Papa, footwear and accessories specialist
Indémodable, and e-cigarette vendor Cigusto in France, as well as
Centros Ideal beauty clinics in Spain and, in healthcare, the
pharmacist Pharmavalley and dental clinic network Vertuo.
To date, La Barbe de Papa already has a network of 64 stores,
including 30 in Carmila-owned centres (29 branches and 1 franchise)
and Indémodable has 8 stores in Carmila centres, including a
recently-opened store in Aix-en-Provence. Cigusto offers its
products in 60 stores, including 20 in centres owned by
Carmila.
By the end of 2020, La Barbe de Papa plans to open six new
stores and to launch new concepts. Indémodable continues to develop
and is to open six further stores, while Cigusto has 10 new stores
in the pipeline.
Carmila presents Carmila Franchise & Development, a
turnkey service to support tenants and franchisees
Drawing on its retail DNA and extensive local knowledge, Carmila
created Carmila Franchise & Development, which forms part of
its strategy of positioning itself as a business facilitator for
retailers by offering bespoke support. Carmila facilitates the
entire set-up process and is involved in steps from analysing
requirements, prospecting and sourcing candidates, to connecting
stakeholders and assisting with all marketing and digital launch
initiatives.
Carmila Franchise & Development thereby offers broad-based
support to local retailers aiming to expand using a franchise model
or affiliate network, as well as to franchisors seeking experienced
retailers.
La Banque Postale opts for a local touch with Carmila for its
annual tour
In a bid to connect more closely with their customers, La Banque
Postale and other retailers have chosen Carmila’s shopping centres
thanks to their role as key regional players.
Carmila Event, Carmila’s integrated events agency, is getting
involved in the annual “Sur la route de vos projets” tour launched
by La Banque Postale Financement (a La Banque Postale subsidiary),
RMC, My Cuisine and 01net in eight Carmila shopping centres. For
this event, where experts and advisors are on hand for
consultation, Carmila makes its extensive network available to the
retailers while at the same time strengthening its local service
relationship with its customers.
Carmila picks up two EPRA Gold Awards
As part of its Best Practices Recommendations, EPRA awarded
Carmila a Gold Award for the third consecutive year as an
acknowledgement of the Group’s high-quality financial reporting.
This year, Carmila also picked up a second Gold Award for its 2020
sustainability reporting as part of ERPA’s Sustainability Best
Practices Recommendations (sBPR).
4. CSR highlights
for third-quarter 2020
As part of its “Here we act” sustainability drive, Carmila
rolled out further positive-impact initiatives aimed at boosting
regional economies, protecting the environment and motivating
employees.
In the regional economy space, Carmila is intensifying its
partnerships with local not-for-profit stakeholders. Since early
September, the Cap Saran shopping centre, which is already involved
in a broad spectrum of not-for-profit projects such as second-hand
clothing sales, has hosted the Emmaüs Loiret and La Ressource AAA
charities at a circular economy pop-up store selling pre-owned
clothing and other articles donated to or designed by the
charities.
During the third quarter, Carmila completed the environmental
audit of its shopping centres and set itself new targets, including
a 50% reduction in GHG emissions and a 40% reduction in energy
consumption by 2030. Consistent with its proactive drive to
continuously improve its environmental performance, Carmila visited
all of the sites audited in 2020 for BREEAM in-Use certification in
France and Spain.
After presenting its CSR strategy to all of its teams, during
the summer Carmila organised “Mydea”, a brainstorming initiative
designed to promote innovative employee sustainability projects.
The CSR momentum was maintained over Sustainable Development Week,
with a host of employees taking part in workshops and conferences
on climate-related and responsible consumption issues.
*******
INVESTOR AGENDA
17 February 2021 (after trading): 2020 Annual Results
18 February 2021 (9:00 a.m. Paris time): Investor and
Analyst Meeting 22 April 2021 (after trading): First-quarter
2021 Financial Information 28 July 2021 (after trading):
2021 Half-year Results 29 July 2021 (2:30 p.m. Paris time):
Investor and Analyst Meeting
ABOUT CARMILA
As the third largest listed owner of commercial property in
continental Europe, Carmila was founded by Carrefour and large
institutional investors in order to transform and enhance the value
of shopping centres adjoining Carrefour hypermarkets in France,
Spain and Italy. At 30 June 2020, its portfolio was valued at €6.2
billion, comprising 215 shopping centres, all leaders in their
catchment areas. Driven by an ambition to simplify and enhance the
daily lives of retailers and customers across the regions, the
local touch is at the heart of everything Carmila does. Carmila’s
teams have a deeply-anchored retail culture, comprising experts in
all aspects of retail attractiveness: operations, shopping centre
management, leasing, local digital marketing, business set-ups and
CSR. Carmila is listed on Euronext-Paris Compartment A under the
symbol CARM. It benefits from the tax regime for French real estate
investment trusts (“SIIC”). Carmila became part of the FTSE
EPRA/NAREIT Global Real Estate (EMEA Region) indices on 18
September 2017. Carmila became part of the Euronext CAC Small, CAC
Mid & Small and CAC All-tradable indices on 24 September
2018.
IMPORTANT NOTICE
Some of the statements contained in this document are not
historical facts but rather statements of future expectations,
estimates and other forward-looking statements based on
management's beliefs. These statements reflect such views and
assumptions prevailing as of the date of the statements and involve
known and unknown risks and uncertainties that could cause future
results, performance or events to differ materially from those
expressed or implied in such statements. Please refer to the most
recent Universal Registration Document filed in French by Carmila
with the Autorité des marchés financiers for additional information
in relation to such factors, risks and uncertainties. Carmila has
no intention and is under no obligation to update or review the
forward-looking statements referred to above. Consequently, Carmila
accepts no liability for any consequences arising from the use of
any of the above statements.
* Panel Quantaflow/French Council of Shopping Centres (CNCC) for
France, panel Footfall for Spain.
Visit our website at www.carmila.com/en/
https://www.linkedin.com/company/carmila/
https://twitter.com/CarmilaFrance
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version on businesswire.com: https://www.businesswire.com/news/home/20201023005358/en/
INVESTOR AND ANALYST CONTACT Florence Lonis – General
Secretary florence_lonis@carmila.com +33 6 82 80 15
64
PRESS CONTACT Morgan Lavielle - Corporate Communications
Director morgan_lavielle@carmila.com +33 6 87 77 48
80
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