Société de la Tour Eiffel (EIFF) H1 2024 earnings summary

Executive summary

• H1 2024 marked by a challenging French property market, with continued adaptation of the transformation roadmap, focus on asset rotation, innovation, and ESG/CSR initiatives.

• Portfolio value at €1,668.8m, down 4.5% like-for-like over six months, with disposals totaling €16.9m and €38m invested in developments.

• Net loss widened to €39.1m in H1 2024 from €16.3m in H1 2023, mainly due to higher asset depreciation and financial charges.

• Dividend suspended for the period; stable shareholder base with Groupe SMA holding 52.3%.

• Emphasis on environmental performance, circular economy, and innovative asset management, including geothermal energy and urban agriculture in new projects.

Financial highlights

• EPRA earnings per share: €0.49 for H1 2024, down from €0.90 in H1 2023; recurring net profit (EPRA earnings) at €15.0m, down from €21.3m.

• Gross rental income: €41.2m, down 1.4% from €41.8m in H1 2023.

• Cash flow per share: €0.58 (vs. €0.93 in H1 2023); cash flow from operations fell to €9.6m from €15.4m.

• EPRA NTA per share: €36.4, down from €45.6 in H1 2023.

• Net financial debt: €742.2m; average cost of debt 1.71%; LTV at 44.5%.

Outlook and guidance

• Roadmap supported by the Board, with focus on asset diversification, ESG, adapting financial structure, and reducing office exposure to two-thirds.

• Targeting at least 80% of assets with environmental certification and expanding into major French metropolitan areas.

• Management anticipates pressure on ICR and LTV covenants due to higher interest rates and is exploring options to strengthen the financial structure.

• Recent asset disposals post-June 2024 support dynamic portfolio management.