ANNUAL RESULTS 2023

Altarea implements its roadmap with strong will and determination, and reaffirms the confidence in its outlook 

The strategic roadmap of Altarea includes two years of adaptation to the change of cycle (2023 and 2024), followed by three years of ramping-up in urban transformation activities and the new businesses. 

Strong performance from the Retail 

• Tenant’s revenue +7.0%, Footfall +3.0% 
• Net rental income €204.8 million (+6.0% like-for-like), Occupancy rate 97.3% 

Significant reduction in commitments in Residential 

• Accelerated sale of existing offer (reservations €2.2 billion, -16%(¹)) 
• Drastic reduction in land acquisitions (-59%) 
• Recovery of €346 million in cash (Residential WCR at 16.7% of revenue) 

Investments in historical activities, new businesses and decarbonisation 

• New-generation Residential offer, affordable, low-carbon, profitable 
• High potential projects in Logistics and in Retail 
• New businesses (Data Center, Asset Management, Photovoltaic) 
• Reduction in greenhouse gas (GHG) emissions by 16% 

Assumed shortfall in FFO(²) (recurring net income) at €101,2 million (vs €275,4 million) 

Proactive adjustment of values in Property development 

• Changes in value(³) of Property development -€448,8 million before tax 
• NIGS(⁴) -€472,9 million including changes in value, lower Net Asset Value (115.7 €/s, -26.3%) 

Financial strength 

• A REIT financial structure (72% of employed capital⁵) 
• Solid ratios (LTV6 28.7%, ICR7 7.5x), almost stable net debt(⁸) (€1.6 billion) 
• Strong liquidity (€2.4 billion) covering debt maturities over next 4 years 
• Signing of €1.3 billion financing agreements taxonomy-linked (maturities in 2028 and beyond) 

Dividend proposed for year 2023: €8.00 per share with options between 100% payment in cash or 25% in cash and 75% in shares (submitted for approval at the General Meeting on June 5, 2024). 

Outlooks⁹ 

• Increase in 2024 FFO, the extent of which will depend on the macroeconomic environment 
• 4-year FFO objective: exceed the previous cycle’s peak (>€300 million). 

“The real estate crisis triggered by the rise in interest rates in 2022 marks the end of a cycle that will have lasted nearly 15 years. This crisis is particularly strong and no sector of real estate is spared. With our experiences, we believed it was necessary to act with clear-headedness and determination by assuming the crisis could last. 

In 2023, Altarea remained extremely disciplined and strict in managing its commitments and executing its roadmap. In an environment where all real estate assets are subjected to value adjustment, we have focused on the reinforcement of Groupe financial strength by reducing capital employed in Property development business 

and relying on our solid financial structure largely owing to Retail REIT. 

Altarea will dedicate the year 2024 to restoring the profitability of Property development, which will take advantage of a redesigned Residential offering and adjusted values. The contribution of new businesses is expected to remain unsignificant, though the Group’s results will still be mainly driven by Retail. The debt will be maintained at current level, except for potential external growth. The 2024 FFO is expected to increase, the extend of which will depend on the macroeconomic environment, thus the year 2023 markes a low point. At the end of the adaptation period to cycle change, Altarea anticipates a ramp-up of its FFO, which should, within a four-year timeframe, exceed 300 million of euros. 

The strength of our Group lies in our complex operational expertise, and our goal is to take the leading positions in markets that are deep and require strong expertise: new housing, retail, and logistics infrastructure, transformation and decarbonisation of real estate assets, digital infrastructure, and renewable energies. More than ever, our ambition is to reinforce our leading postion on this huge low-carbon urban transformation market. 

We are fundamentally confident in Altarea’s strategy and prospects. Our Group is funded on determination, led by experienced management, and formed by engaged teams. Should market conditions improve, especially with easier access to credit of individuals, Altarea will leverage its financial strength to accelerate its development in Residential or to seize opportunities in both its historical activities and new businesses.” 

Alain Taravella, Chairman and Founder of Altarea

Follow the presentation of the 2023 annual results on Wednesday, February 28, 2024 at 8:30 am by clicking here (FRENCH ONLY)

Paris, 27 February 2024, 5.45 p.m. After review by the Supervisory Board, Management approved the consolidated financial statements for the 2023 financial year. Audits of the consolidated and individual financial statements (Altarea SCA) have been completed and the audit reports are in the process of being issued 

 (¹) This represents a decrease of -20% in volume, in a new housing market down by -26% (source FPI, Frédération des Promoteurs Immobiliers). 

(²) Funds From Operations (FFO): net profit excluding changes in value, calculated expenses, transaction fees and changes in differed tax. Groupe share. 

(³) See chapter “Financial and Environmental Performance” later in the press release. 

(⁴) Net income Groupe share. 

(⁵) €4.2 billion out of €5.7 billion (see the Loan to Value (LTV) ratio calculation table in the Business review). 

(⁶) Loan To Value: Net bond and bank debt consolidated reported to the consolidated market value of the Group’s assets (bank covenant definition). 

(⁷) Interest Coverage Ratio : Operating income / Cost of net debt (column « Current cash flow from operations ») (bank covenant definition). 

(⁸) Bank and bond debt. 

(⁹) Unless there is further deterioration in the macroeconomic, geopolitical, sanitory, or regulatory environment.