PLAZA CENTERS N.V. - Full Year results for the year ended 31 December 2011 (3/2012)

| | POLISH FINANCIAL SUPERVISION AUTHORITY | | | | | | | | | | |
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| | | | | UNI - EN REPORT No | 3 | / | 2012 | | | | |
| | Date of issue: | 2012-03-15 | | | | | | | | | |
| | Short name of the issuer | | | | | | | | | | |
| | PLAZA CENTERS N.V. | | | | | | | | | | |
| | Subject | | | | | | | | | | |
| | Full Year results for the year ended 31 December 2011 | | | | | | | | | | |
| | Official market - legal basis | | | | | | | | | | |
| | Inne uregulowania | | | | | | | | | | |
| | Unofficial market - legal basis | | | | | | | | | | |
| | Contents of the report: | | | | | | | | | | |
| | PLAZA REPORTS STRONG REVENUE GROWTH AND OPERATIONAL PROGRESS - SUCCESSFUL REALIZATION OF US INVESTMENT IN A DEAL VALUED AT US$1.4 BN - Plaza Centers N.V. (?Plaza" / ?Company" / ?Group"), a leading property developer and investor with operations in Central and Eastern Europe, India and the USA, today announces its full year results for the year ended 31 December 2011. Financial highlights: ? Total assets of ?1.3 billion (31 December 2010: ?1.4 billion) ? Revenues increased 52% to ?57 million (31 December 2010: ?38 million) as a result of an increased number of active shopping centres operational for a full year in CEE, increased income derived from the US portfolio and improved occupancy rates across the portfolio ? Net Asset Value decreased by 11% to ?601 million (31 December 2010: ?675 million) primarily through the impairment of assets in Romania and Latvia ? Net Asset Value per share of ?1.69 (31 December 2010: ?1.96), a decline of 14%, attributable mainly to the above mentioned impairment ? Profit
before income tax of ?29 million (31 December 2010: ?13 million profit) arising from the increased income derived from operating shopping centres and an increase in net finance income ? Basic and diluted EPS of ?0.03 (31 December 2010: ?0.03) ? Cash position at year end (including restricted bank deposits, short term deposits and available for sale financial assets) of ?108 million (31 December 2010: ?195 million) with working capital of ?585 million (31 December 2010: ?713 million); current cash position of circa ?100 million ? Conservative gearing position maintained, with debt comprising 59% of balance sheet (31 December 2010: 56%) ? Over the year, the Board of Plaza approved two buyback programmes of a total of up to NIS 300 million (approximately ?60.5 million) of its Series A and Series B Notes, which are traded on the Tel Aviv Stock Exchange ? On 14 September 2011, the Board of Directors approved the payment to shareholders of an interim cash dividend payment of ?0.1010 per share amounting to total
distribution of ?30 million. Operational highlights: ? Plaza delivered on its strategy to take advantage of weak market conditions and depressed values in the United States, with the completion of the acquisition by the Company?s joint US subsidiary of all of the outstanding units of EDT Retail Trust (?EDT") and thereby a US$1.4 billion portfolio of retail assets. The total cost to Plaza of the acquisition was US$82 million for the 22.7% stake. During the year, Plaza also received its US$5.9 million share of a dividend payment from EDT. Subsequent to the year end the vast majority of the assets were sold to a joint venture between Blackstone Real Estate Advisors VII L.P. (?Blackstone Real Estate") and DDR Corp. ? Torun Plaza, Plaza?s tenth retail scheme in Poland and its 31st shopping centre in the CEE, was completed and opened in November 2011. The 40,000 sqm GLA centre includes an eight screen cinema complex, a Fantasy Park entertainment centre and a Delima delicatessen, as well as over 120 shops
comprising international and local brands such as H&M, C&A, KappAhl, Zara, Bershka, Stradivarius, Pull & Bear, Massimo Dutti, Reserved, Cropp House, Mohito, Mango, New Yorker, Rossmann, Douglas and Sephora. Torun Plaza is currently approximately 80% let with ongoing interest from potential tenants ? The construction of Plaza?s first retail scheme in Serbia, Kragujevac Plaza, was completed, with the centre due to open to the public on 20 March 2012. The 22,000 sqm GLA centre is already 90% pre-let, with a further 6% of space in advanced negotiations and strong interest in the remaining units. Kragujevac Plaza is the first shopping centre to be completed outside the capital Belgrade, and will therefore enjoy a catchment area of approximately 590,000 inhabitants Key highlights since the period end: ? After the balance sheet date, Plaza?s US based joint venture, EPN Group, entered into an agreement to sell 47 of its 49 US based assets to BRE DDR Retail Holdings LLC, a joint venture between Blackstone Real Estate
and DDR Corp. in a transaction valued at US$1.428 billion. Once closed in June 2012, the transaction is likely to generate a cash inflow of US$120 million (?93 million) to the Company before taxes and transaction costs ? Following the sale of the 47 properties, EPN Group will continue to hold two properties located in the United States that are valued at approximately US$43 million with total non-recourse secured debt of approximately US$14 million ? Phase one of the Kharadi Plaza project known as ?Matrix One", a 50:50 joint venture with a local partner, was completed in February 2012. Located in Pune, India, ?Matrix One?, a 28,000 sqm GLA office, was 70% pre-sold upon opening. The construction of the second office building, out of a total of four offices planned for the development, is expected to start in Q2 2012 ? Koregaon Park Plaza mall, also located in Pune, India, was completed and a successful soft public opening was held on 2 March 2012 with the grand opening scheduled for H2 2012. The 48,000 sqm
total built area (excluding parking) shopping centre is circa 85% let with signed lease agreements, with a further 5% committed under memoranda of understanding Commenting on the results, Ran Shtarkman, the President and CEO of Plaza Centers, said: ?Plaza has delivered a strong set of results for the reporting period, with the Company again reporting large increases in revenues and profits before income tax while maintaining good operational progress. ?Against a background of continuing economic and market uncertainty, it is pleasing to have been able to report a 52% increase in revenues. ?Our scheduled programme of developing a limited number of centres into markets with the highest retail demand continues to progress strongly. Two of our major retail schemes, Toruń Plaza in Poland and Koregaon Park Plaza in Pune, India, came on stream in Q4 of 2011 and March 2012, respectively. We also continue to be encouraged at the apparent strength of the occupier market in these regions, especially Poland, where
top-quality retail and leisure assets continue to attract major pan-European occupiers who are drawn by the notion of western-style retail design in strong regional centres as opposed to the weaker markets such as Bulgaria and Romania where we have had to reflect an impairment loss for the year. For this reason, although we have traditionally sold the majority of our shopping centre developments, we will continue to retain our major schemes until we see clear evidence that sale prices will properly reflect their existing and potential valuation. Therefore, as of the end of March 2012, Plaza will own and operate seven active malls across the CEE region and India. ?The other key event of the year and the beginning of 2012 was the realisation of the majority of our investment in EDT, through which Plaza achieved its aim of utilising its expertise to reposition a portfolio of highly yielding properties in the US. The subsequent agreement to sell these assets is anticipated to generate a pre-tax Return on Equity
(ROE) of nearly 50% over a period of little over 18 months. To ensure that Plaza continues to be conservatively geared, the proceeds of this sale, once completed, will be used to pay down some of the Company?s debt and to continue to drive our development projects. ?We remain mindful of the challenging and volatile economic conditions in Europe. As a result, we will continue to pursue a conservative approach to our business, de-risking our development programme and skilfully managing both our finances and investment assets to maximise value for our shareholders." For further details please contact: Plaza Ran Shtarkman, President and CEO Roy Linden, CFO +36 1 462 7221 +36 1 462 7222 FTI Consulting Stephanie Highett/Daniel O?Donnell +44 20 7831 3113 | | | | | | | | | | |
| | Annexes | | | | | | | | | | |
| | File | Description | | | | | | | | | |
| | Plaza Centers Final Results 150312.pdf | | | | | | | | | | |

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| | | PLAZA CENTERS N.V. | | | | | |
| --- | --- | --- | --- | --- | --- | --- | --- |
| | | (fullname of the issuer) | | | | | |
| | | PLAZA CENTERS N.V. | | Budownictwo (bud) | | | |
| | | (short name of the issuer) | | (sector according to clasification of the WSE in Warsow) | | | |
| | | 1016EA | | Amsterdam | | | |
| | | (post code) | | (city) | | | |
| | | Keizergracht 241 | | 241 | | | |
| | | (street) | | (number) | | | |
| | | (phone number) | | | (fax) | | |
| | | (e-mail) | | | (web site) | | |
| | | (NIP)
| | | (REGON) | | |

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