Strong results – 27% improvement in FFO and 23% improvement in gross margin

Q1 2018 FINANCIAL HIGHLIGHTS

  • Gross margin from rental activity up by 23% to €27m (€22m in Q1 2017)
  • FFO I increased 27% to €15m (€12m in Q1 2017), FFO I / share at €0.03
  • Profit before tax at €30m (€33m in Q1 2017), earnings per share at €0.05
  • In-place rent up 3% to €114m (€110m at 31 December 2017)
  • EPRA NAV increased 3% to €1,101m (€1,073m as of 31 December 2017)
  • EPRA NAV / share increased 3% to €2.34 (€2.28 as of 31 December 2017)
  • Average interest rate down to 2.7% p.a. from 2.8% p.a. as at 31 December 2017
  • Interest cover at 4.3x
  • Net LTV at 43% vs. 42% as at 31 December 2017

PORTFOLIO HIGHLIGHTS

  • Completion of the two buildings in Green Heart project (formerly GTC Square)
  • Acquisition of Mall of Sofia and Sofia Tower
  • Strong asset management
    • Occupancy at 93% (94% as at 31 December 2017)
    • 34,000 sq. m of office and retail space newly leased and renewed in Q1 2018

We achieved solid results in the first quarter of this year, improving our gross margin on rental activity by 23% and improving our FFO by 27%.said Thomas Kurzmann, GTC’s CEO. However, the most important is that we managed to secure further growth, seizing the opportunity in the growing economy in Bulgaria and acquiring Mall of Sofia, which will appreciate value by taking advantage of fast growing customer spending power. This acquisition is another step in reaching our mid to longer term NAV growth target

During this quarter we benefitted from strong refinancing activity, which helped us to further improved the average interest rate in our portfolio to 2.7%. Based on moderate leverage and a good cash position we are able to reinforce our development activity as well as secure highly accretive asset acquisition. With the acquisition Mall of Sofia we acquired EUR 7.55 million in-place rent with less than EUR 30 million equity, achieving 19% yield on equity invested. This will improve GTC’s profitability through an overall increase in EBIT, while leveraging on existing local management platform and increase our FFO to provide for additional dividend capacity and fund further growth – added Erez Boniel, GTC’s CFO.

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Concentrix to open its office in Advance Business Center, leasing almost 75% of the project’s first stage

  • Concentrix will initially lease 11,500 m GLA of office space with GTC’s Advance Business Center I with an option to extend the leased space by another 2,900 sq. m
  • Advance Business Center I is the first stage of a modern class A office building, which is currently being developed by GTC in Sofia, Bulgaria, with completion scheduled for Q1 2019
  • Total leasable area of the building is 15,600 sq. m

Concentrix, international leader in global business services (subsidiary of SYNNEX Corporation), signed head of terms with GTC Bulgaria to lease 11,500 sq. m GLA of office space with 225 sq. m terrace and 220 parking spaces in Advance Business Center I. GTC and Concentrix concluded the agreement with an option for additional 2,900 sq. m GLA. Advance Business Center I, currently under construction, and planned to be completed in Q1 2019.

“We are delighted to welcome Concentrix as our client and looking forward to cooperate with such an experienced company. It is safe to say that Concentrix’s demanding employees will find their new working space to be of the highest quality and comfort. Advance Business Center will be the highest office building in the established business location with excellent transport accessibility and was already awarded LEED GOLD pre-certificate– added Daniel Bercovich, GTC Bulgaria’s CEO.

Advance Business Center I is located next to a metro station, providing quick access to the main area – of the Ring Road and Alexander Malinov Blvd, where many companies establish their headquarters in Sofia.

Advance Business Center will deliver 9 office floors of 15,600 sq. m GLA and 3 underground levels with 270 parking lots. Additional 7 parking places will be available on the above ground parking. The office building will feature an exquisite reception with state-of-the-art lobby, as well as restaurant and cafeteria with outside seating places providing view of the green areas.

The expected delivery of the first stage is Q1 2019. The second stage, Advance Business Center II, will offer 17,500 sq. m of additional office space and is planned to be delivered in Q4 2019.

Advance Business Center Sofia (4) - Kopia