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GRUPO GICSA, S.A.B. DE C.V.: Announces Consolidated Results for Third

24.10.2018 - 22:35

MEXICO CITY / ACCESSWIRE / October 24, 2018 /GRUPO GICSA, S.A.B. de C.V. ("GICSA" or "the Company") (BMV: GICSAB), a Mexican leading company specialized in the development, investment, commercialization and operation of shopping malls, corporate offices, industrial buildings and mixed use properties, announced today its results for the third quarter ("3Q18") and ninth months ("9M18") periods ended in September 30, 2018.All figures have been prepared in accordance with International Financial Reporting Standards ("IFRS") and are stated in millions of Mexican pesos (Ps.) GICSA's financial results presented in this report are unaudited; therefore figures mentioned throughout this report may present adjustments in the future.GICSA's financial results presented in this report are unaudited; therefore figures mentioned throughout this report may present adjustments in the future.Main HighlightsCorporative - During the quarter, we opened Explanada Puebla, Paseo Quer�taro and Masaryk 169, adding 159 thousand su of GLA to the Company's portfolio, which at the closed of the quarter had 82%, 92% and 100% of their GLA for commercial use under contract. - With these openings, 5 properties were integrated to the new concept Malltertainment setting the standards of innovation and evolution of shopping malls in MexicoOperational - GICSA reported a total of 830,029 square meters (m�) of Gross Leasable Area (GLA) comprised of 11 stabilized properties and 4 properties in stabilization at the conclusion of 3Q18. GICSA�s proportional GLA during 3Q18 was 689,641 square meters, an increase of 121 thousand square meters, 17.04% higher that the figured reported for the same period of the previous year. - As of 3Q18, the occupancy rate of the stabilized properties was 92.19%. - Average leasing rate per square meter at the end of 3Q18 was Ps. 369, a 9.98% increase compared to 3Q17, which was Ps. 335. - GICSA registered an accumulated occupancy cost of 8.35% in 9M18, and an increase in same-store sales of 4.75% in the same period. - At the close of 3Q18 GICSA had a total of 15 million of visitors in the shopping malls of the portfolio, and 42 million of visitors in 9M18.Financial - A Starting this quarter, the transaction announced in a relevant event on July 3 is reflected in the Company's results. This consists in the restructuring of the joint portfolio with various investors that participate in some of the developments of the Company's portfolio, as well as the signing of a contract of real estate services provided in various projects. In summary, the transaction had the following effects: - Starting in 3Q18, the Company reported 100% stake of the following properties: Forum Culiacan, Tower E3, Capital Reform, Masaryk 111, City Walk and Forum Buenavista. Forum Coatzacoalcos will be reported at 50%, while Forum Tlaquepaque, Las Plazas Outlet Lerma and Reforma 156 will be dis-incorporated from the Company's portfolio. - The aforementioned generated an additional proportional NOI for GICSA of Ps. 98 million in 3Q18. - The contract that recognizes the real estate services previously provided signed by the Company generated revenues by Ps 1,128 million, of which the Company charged Ps. 282 million upon signing and will receive additional Ps. 846 million in the next 15 months. This was reflected in the 2Q18 results. - In order to facilitate the understanding and comparability of the financial results presented during this quarter, this report presents a comparison with proforma financial statements, as if the transaction had occurred in the corresponding periods of 2017 fiscal year. - Net operating income (NOI) reached Ps. 632 million in 3Q18, a decrease of 15.49% compared to 3Q17 due to the divestment of some properties according to the agreement with minority partners (Forum Tlaquepaque, Isla Vallarta, Outlet Lerma and Reforma 156). Excluding these properties, NOI increased by 2.54%. On the other hand, including these properties, proportional NOI increased 9.13% during the quarter, and excluding the divested properties proportional NOI increased 30.22%. - EBITDA was Ps. 636 million in 3Q18, a decrease of 15.99% including the divested properties. GICSA's proportional EBITDA was Ps. 507 million, an increase of 8% compared to 3Q17 including the divested properties. - At the close of 3Q18, net income had lost for Ps. 2,197 million; while GICSA's proportional net income was Ps. 1,441 million. - Consolidated debt at the close of 3Q18 was Ps. 20,970million; while GICSA's proportional debt was Ps. 19,805 million.Pipeline - As of September 30, 2018, the commercialization of properties under development reached progress of 318,816 square meters of GLA under contract. This represents 63.54% of the total space comprising projects under commmercialization process.Comments by the Chief Executive OfficerDear Investors:It is my pleasure to share with you our results for the Third Quarter 2018. This quarter was very important to us since there were a lot of events in favor of the consolidation of the objectives of our growth plan. In recent days, we delivered the Explanada Puebla, Paseo Quer�taro and Masaryk 169 projects, which will add a GLA of more than 159 thousand square meters to GICSA's portfolio. As of today, these properties combined have advanced their signed commercial GLA by more than 90%. These openings join La Isla Merida and Paseo Interlomas expansion, which were delivered last quarter.I am glad to let you know how well accepted these properties have been; they have received 359 thousand accumulated visitors just in the opening weekend.These openings are part of the five properties that comprise the Malltertainment concept developed by the Company, which are a catalyst in the evolution of shopping malls, and represent an important step towards our constant commitment to innovation and permanence in the long term within our key markets.Our stabilized and stabilizing portfolio continues to post positive operating results, which are reflected in our key indicators. During the quarter we registered a 92% occupancy level and a consolidated occupancy cost of 8.4%.The lease spread for the quarter was 9%, with a renovation rate of 97%, along with 10% and 15% increases in the average leasing rate and fixed income, respectively.Moreover, the number of visitors to the properties of our current portfolio reached 15 million, 15% growth compared to the same period last year.The commercialization of properties under stabilization in our pipeline posted a solid performance; this quarter we signed more than 25 thousand square meters of GLA, reaching 64% of the total GLA under commercialization.Our financial indicators demonstrated important progress during the quarter related to our proportional participation; beginning this quarter we can see the results of the agreement that