Malta Properties Company plc - Interim Directors’ Statement

On 9 December 2024, Malta Properties Company plc issued an Interim Directors’ Statement updating the market on its performance during the nine-month period ended 30 September 2024.

Revenues surged by 17.9% to €4.32 million (Jan-Sep 2023: €3.66 million) driven by the rental income from The Exchange at Spencer Hill in Marsa, which had welcomed its first tenant during the second half of last year. MPC explained that the increase in revenue also reflects additional rental income from the Mediterranean Building in Ta’ Xbiex which is fully occupied.

In view of the higher level of income, operating profit increased by 18.4% to €3.26 million compared to €2.75 million during the corresponding period in 2023. The EBIT margin also improved slightly to 75.5% (Jan-Sep 2023: 75.2%).

Overall, the profit for the period amounted to €1.75 million, which is 50% higher than the reported figure of the same period in 2023 of €1.16 million.

Operational Update

MPC explained that a new lease agreement with a government authority was secured for The Exchange at Spencer Hill in Marsa. As a result, the property will be fully leased out once works are completed over the course of 2025, including the building of a substantial rooftop extension.

Furthermore, a new lease agreement with the Ministry of Health was secured for the entirety of the Swatar property which was vacated by HSBC Global Services at the end of October. One floor of this property had been released earlier in the year and the new tenant leased this area from the end of Q1 2024. The company explained that the remaining three floors will be occupied by the same tenant once renovation works are completed in 2025.

Outlook

MPC explained that it expects the steady performance to continue for the rest of the financial year and maintains a positive outlook beyond, reflecting the strength of the Maltese economy, despite challenges in the office market.

In particular, the company noted that 2025 will be an important year for the Group since several leases are expiring at the end of 2024. In this respect, MPC highlighted that it will remain focused on securing new tenants for these properties. Some of these properties require renovations and these works will continue in the first half of 2025.  As a result, income from these properties will decrease in 2025 while renovation works are undertaken and until new tenants are secured.

The Board concluded that the Group remains in a good position to withstand changes in the environment, underpinned by the quality of its tenants, strong balance sheet and long-term financing, and a focus on providing a good service to its tenants.