URW stronger in first half as Westfield owner says Q2 tenant sales beat pre-Covid levels
France-based malls giant Unibail-Rodamco-Westfield (URW) has reported “continued recovery across all business divisions” and on Thursday said that Q2 tenant sales are exceeding pre-Covid levels.
Reporting its first-half results, the owner of the giant Westfield malls chain — along with other major properties globally — said it has seen strong leasing demand and reduced vacancies “as retailers continue to expand selectively at [the] best locations”.
The company also raised its adjusted recurring earnings per share guidance for 2022 and saw its sharse rising as a result. It now expects a 2022 figure of at least at €8.90, having previously forecast €8.20 to €8.40.
Looking at the numbers in detail, the company said net rental income was €1.139 billion, up 45%, and H1 earnings before interest, taxes, depreciation and amortisation (EBITDA) jumped 48% year-on-year to €1.14 billion. Recurring net income rose over 50% to €711 million.
Rent collection was at 96% against 88% reported for the whole of last year and 73% for 2021’s first half.
And it said tenant sales in Q2 were running at 105% of those in the same period of 2019, ahead of expectations, with overall sales for H1 at 99% of 2019 levels. That divides down into Continental Europe at 97%, the UK at 91% and the US at a strong 106%.
Meanwhile retail vacancies are running at only 6.9% at group level compared to 7% last year. They’re 9.7% in the UK (down from 10.6%), 10.4% in the US (down from 11%), and 4% in Europe, which is the same as a year ago.
CEO Jean-Marie Tritant said: “Our operational performance in H1 was very strong. We are seeing strong leasing demand, with retailers expanding with us, thanks to the quality of our assets, which are located in the best catchment areas, and have an affluent customer base. URW is well positioned to outperform and gain market share, as retailers accelerate their ‘drive to store’ strategies. Against this backdrop, asset values have stabilised, and our credit metrics have significantly improved, in particular thanks to the net debt reduction and the increase in EBTIDA.”
He added that in Europe, it has achieved 80% of its €4 billion asset disposal target. And in the US, it has continued to streamline its regional asset portfolio.
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