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The operator of shopping centres, Unibail-Rodamco-Westfield (ASX:URW) today reported proportionate turnover of â¬939.6 million, up by +70.2%, for three months ended 31 March 2019. The growth is primarily driven by the acquisition of Westfield Corporation (WFD) in 2018.
The Group has achieved an attractive 73.0% growth in the proportionate GRI or Gross Rental Income of the Shopping Centre segment amounting to â¬673.9 million for the first quarter of 2019. Its overall GRI growth includes 3.7% in France, 3.6% in Central Europe and 3.2% in Austria.
Despite an unfavourable Easter season, the Groupâs European shopping centres have achieved +4.3% improvement in tenant sales through 31 March 2019, compared to the previous corresponding period. Through February, tenant sales in Europe were up by +3.0%, thereby outperforming the total national sales indices by +166 basis points due to the performance and premium quality of the Groupâs European shopping centres.
The robust performance was recorded by the company in the United Kingdom, the Nordics, Central Europe, and France for +8.5%, +14.5%, +5.3% and +3.4%, respectively. In the United States, speciality sales per square feet under URW assets has shown significant improvement of 5.3% through 31 March 2019 and by +10.7% on a trailing 12-month basis.
On 9 April 2019, URW inked an agreement with the institutional buyers to sell Tour Majunga in La Défense at â¬850 million, representing a premium to the book value as at 31 December 2018. The closing of this transaction forms part of the â¬3 billion disposal plan announced by the company in December 2017 which was further extended to a total of â¬6 billion disposal target in February this year.
It has been informed that all the disposals were made at an average premium above the book value of 7.2% and an average net initial yield of 4.5%. Currently, â¬2.9 billion is yet to be disposed of.
The GRI of the Office division declined by -25.4% to â¬29.2 million compared to the first three months of 2018. This reflects the 43.4% contraction in the rental income of offices in France due to the disposals of Capital 8 and Tour Ariane in 2018. Recently, the company has entered into a lease agreement with Wojo for all 13,100 sqm of office space in the Gaîté Montparnasse project in Paris, scheduled to be delivered in H2 2020.
With respect to Convention & Exhibition division, the GRI was reported to â¬65.6 million, up 9.1% on the back of triennial shows such as Wine Paris and in-cosmetics.
The company further reaffirmed its 2019 guidance for Adjusted Recurring Earnings to be within â¬11.80 - â¬12.00 per share.
URW stock price edged up by 3.598% to last trade at $12.380 on 26 April 2019. The stock has closed at a Price to Earnings multiple of 17.530x with a market capitalisation of $33.06 billion. Over the past 6 months, URW has declined by 6.93% including a dip of 1.24% recorded in the past one month.
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