Mercialys (MERY) H1 2024 earnings summary

Executive summary

• Net recurrent earnings per share grew 3.0%, surpassing the full-year target of at least 2.0% growth, supported by strong operational trends and portfolio re-anchoring away from Casino Group.

• Shopping centers outperformed the broader retail sector, with increased footfall (+2.0% year-over-year) and a diversified tenant base focused on affordable, essential retail.

• Hypermarket operations transfer to Auchan, Intermarché, and Carrefour progressed, enhancing site attractiveness and risk profile.

• Portfolio rotation continued with the disposal of four hypermarkets for €117.5 million, supporting a balanced rental mix and investment potential.

• The company maintained a low financial vacancy rate and sustainable occupancy cost ratios for tenants.

Financial highlights

• Invoiced rents reached €91.4m (+4.0% year-over-year); rental income rose 3.9% to €91.6m; organic growth at +4.1%.

• EBITDA increased 5.2% to €76.1m; EBITDA margin improved to 83.1%.

• Net recurrent earnings reached €59.3m (+3.3% year-over-year), or €0.63 per share (+3.0%).

• Net income attributable to owners was €36.3m (+19.1% year-over-year).

• Portfolio value (incl. transfer taxes) was €2,879.4m (+0.3% like-for-like over six months); average appraisal yield at 6.68%.

Outlook and guidance

• 2024 objectives confirmed: NRE per share growth of at least 2.0% versus 2023.

• Dividend payout expected between 75% and 95% of 2024 NRE.

• Early refinancing of the July 2027 bond maturity is planned, subject to market conditions.

• Continued focus on ESG progress and carbon neutrality by 2030.