Argan (ARG) H1 2024 earnings summary

Executive summary

• Portfolio fair value increased to €3.8 billion at end of June 2024, with a cap rate of 5.3%, up 2% from December 2023.

• Rental income rose 8% year-over-year to €98 million, and recurring net income increased 7% to €67 million.

• Net debt reduced to €1.8 billion, with EPRA LTV down to 46%.

• 100% occupancy rate maintained for the sixth consecutive quarter.

• €150 million capital increase completed in April 2024 to accelerate growth and reduce leverage.

Financial highlights

• Portfolio valuation at €3.8 billion (+2% vs. end 2023), cap rate 5.3%.

• Rental income for H1 2024: €98.1 million (+8% year-over-year); recurring net income: €67 million (+7%).

• Net LTV reduced to 45.9% (from 49.7% end 2023); net debt/EBITDA improved to 9.5x.

• EPRA NTA stable at €78.9 per share; NRV at €89.7 per share.

• EBITDA margin steady at 94%; cost of debt stable at 2.3%.

Outlook and guidance

• 2024 targets confirmed: rental income €197 million (+7%), recurring net income €135 million (+7%), dividend per share €3.30 (+5%).

• Roadmap targets LTV at 38% and net debt/EBITDA below 8x by 2026.

• Average annual rental income growth of 7% expected from 2024-2026.

• No new debt planned until at least 2026; focus on debt reduction and asset disposals.