Half year results summary
Direct investment result: €42.4m +6.5%
Net rental income: €74.2m +3.1%
Like for like rental growth: +3.1%
Retail sales turnover: +0.4%
Property valuations: €2.7bn +0.1%
Adjusted net asset value: €35.45 +0.5%
Vacancies and arrears: <1%
Occupancy cost ratio: 8%

Half year results at 31 December 2013
During the period, Eurocommercial achieved solid like for like
rental growth of 3.1%, contributing to a direct investment result
6.5% higher for the six months to December 2013 than for the
previous corresponding period. Property valuations were almost
unchanged over the six month period at +0.1%.

Direct investment result: €42.4m +6.5%
The direct investment result for the six months to 31 December 2013 rose 6.5% to €42.4 million from €39.8 million for the same period in 2012. The direct investment result is defined as net property income less net interest expenses and company expenses after taxation and, in the view of the Board, more accurately represents the underlying profitability of the Company than IFRS “profit after tax” which must include unrealised capital gains and losses. The direct investment result per depositary receipt rose 4.1% to €1.01 at 31 December 2013 from €0.97 at 31 December 2012 having taken into account the issue of stock dividend depositary receipts in November 2013.

Net rental income: €74.2m +3.1%
Rental income for the six months to 31 December 2013, after deducting net service charges and direct and indirect property expenses (branch overheads), was €74.2 million compared with €72.0 million for the prior year period – an increase of 3.1%.

Like for like rental growth: +3.1%
The like for like (same floor area) rents of Eurocommercial’s properties increased by 3.1% at 31 December 2013 compared with 31 December 2012. Rents rose by 4.2% in France, 3.3% in Italy and 1.7% in Sweden. 200 leases were renewed or re-let in Eurocommercial’s centres during the twelve month period, resulting in an average uplift in minimum guaranteed rent for those shops of 9%.

Retail sales turnover: +0.4%
Like for like retail sales turnover in Eurocommercial’s shopping centres increased by 0.4% for the twelve months to 31 December 2013 compared to the twelve months to 31 December 2012. In France turnovers increased by 0.5%, decreased by -0.5% in Italy and increased by 1.9% in Sweden.

Property valuations: €2.7bn +0.1%
Properties were independently revalued at 31 December 2013 resulting in a 0.1% increase in value compared with June 2013 and 0.3% compared with December 2012. Since June 2013, values were flat in France and increased by 0.2% in Italy and 0.1% in Sweden.

Adjusted net asset value: €35.45 +0.5%
Adjusted net asset value increased by 0.5% to €35.45 per depositary receipt at 31 December 2013 from €35.28 at 31 December 2012 and decreased by 2.8% from €36.47 per depositary receipt at 30 June 2013.

IFRS results
The IFRS net asset value, which, unlike the adjusted net asset value, includes the negative fair value of financial derivatives (interest rate swaps) of €106.7 million and contingent capital gains tax liabilities of €37.0 million, was €32.11 per depositary receipt at 31 December 2013 compared with €32.73 at 30 June 2013 and €30.71 at 31 December 2012.

The IFRS result after taxation for the six months to 31 December 2013 increased to €57.4 million positive from €32.1 million for the same period in 2012. This was mainly due to a positive fair value movement in derivative financial instruments for an amount of €13.6 million compared to a negative amount of €15.5 million for the previous period and a small positive investment revaluation of €2.5 million compared to a negative amount of €13.2 million for the previous period. Deferred tax for the period was a small negative amount of €0.7 million compared to a positive amount of €21.4 million for the previous period as a result of the sale of the Burlöv centre in Sweden and a reduction of the Swedish corporate income tax rate. The derivative financial instruments amount is the result of slightly higher market interest rates since 30 June 2013. The interest expenses were €1.1 million lower than in the previous corresponding period as a result of a lower amount of borrowings drawn down during the period. Company expenses remained stable over the reporting period.

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