Plaza Centres plc - Full-Year Results

Tuesday, March 20th, 2018

On 20 March 2018, Plaza Centres plc published the Annual Report and Financial Statements for the year ended 31 December 2017. It is important to highlight that the 2017 financial results of Plaza include for the first time the twelve-month contribution from Tigne’ Place which was acquired by Plaza on 27 September 2016.

Performance Overview

During the period under review, Group revenues (incorporating both the Plaza Commercial Centre and Tigne’ Place) increased by 20% to €3.28 million, largely reflecting the twelve-month contribution from Tigne’ Place as opposed to three months in 2016. In fact, the company reported that revenues at the Plaza Commercial Centre increased by 4.2% year-on-year to €2.7 million notwithstanding a drop in average occupancy to 94% from 99% in 2016. Overall, the average occupancy rate of the Group, when including both properties, dropped to 84% compared to 88% in the previous year as the company implemented a refurbishment programme at Tigne’ Place which was completed during 2017.

On the expenditure side, operating charges grew by 24.6% to €0.59 million. The increase in costs largely reflects increased marketing, maintenance and refurbishment initiatives and the twelve-month charges related to Tigne’ Place. However, EBITDA still improved by 19% to a record of €2.68 million.

The improvement in EBITDA was almost completely offset by higher depreciation, net finance costs and tax charges. In fact, depreciation increased by 38.1% to €0.51 million whilst net finance costs surged to €0.44 million compared to €0.24 million in 2016, largely reflecting the twelve-month inclusion of Tigne’ Place as well as the twelve-month effect of the additional debt taken on by Plaza in 2016 for the purpose of acquiring Tigne’ Place. Excluding net finance costs, the cost-to-income ratio deteriorated to 33.5% from 30.8% in 2016. Meanwhile, Plaza Centres also incurred a tax charge of €0.47 million in 2017 which is 23% higher than the previous comparable figure of €0.38 million. As a result, the net profit for the year remained broadly unchanged at €1.27 million. This translates into an earnings per share of €0.0449.

The Statement of Financial Position shows a 3.4% increase in total assets to €44.9 million, largely driven by a positive revaluation amounting to €1.11 million to the Plaza Commercial Centre. On the other hand, total liabilities increased only marginally to €17.3 million. Accordingly, shareholders’ funds rose by 5.5% to €27.6 million which translates in a net asset value per share of €0.978 (31 December 2016: €0.927).

Dividend

The Directors are recommending an unchanged final net dividend of €0.0294 per share. Shareholders as at the close of trading on Thursday 26 April 2018 will be eligible to receive this dividend on Wednesday 6 June 2018, subject to shareholders’ approval at the upcoming Annual General Meeting scheduled to be held on Wednesday 30 May 2018.

Outlook

The Directors explained that Plaza Centres will continue renovating and upgrading its retail and commercial space offering in 2018. Overall, the local positive economic landscape is expected to continue driving demand for quality rental and commercial space. Against this background, the Directors of Plaza noted their confidence at achieving higher occupancy levels when compared to 2017.

Download

Plaza Centres plc – Annual Report and Financial Statements for the year ended 31 December 2017.

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