VGP announces FY 2023 Financial Results

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Regulated Information – Insider Information

22 February 2024, 7:00am, Antwerp, Belgium: VGP NV (‘VGP’ or ‘the Group’), a European provider of high-quality logistics and semi-industrial real estate, today announces the results for the year ended 31 December 2023:

  • A net profit of € 87.3 million, an increase of € 209.8 million versus FY ‘22.

  • Executed three joint venture closings resulting in a strong net cash recycling of € 676.2 million. All transactions, including those that are committed to close in ’24 have been realized or agreed at a premium versus the recognized fair value at year-end ’22, resulting in a realized gain of € 59 million in ’23 on the effectuated transactions.

  • Established two new joint ventures with Deka and Areim for a total gross asset value of over € 2.6 billion. Together with two closings with Allianz in H1 ’23, VGP has transacted and/or secured a future pipeline of transactions of € 3 billion gross asset value. Upcoming closings in ’24 expect to recycle minimum € 525 million of gross proceeds at pre-agreed pricing.

  • € 69.5 million of new and renewed leases signed year-to-date bringing the annualized committed leases at year-end to € 350.8 million[1] (+ € 47.6 million compared to 31 December 2022, which is +16% y-o-y).

  • 1,933,000 m² of new development land acquired[2] and 1,324,000 m² of development land deployed to support the developments started up during the year. Total secured land bank stands at 4 million[3] m² at the end of 2023 representing a development potential of over 4.3 million m². Pro forma today’s announced sale of LPM in ‘24, the total secured land bank lowers to 8.6 million m2. Total acquisitions represent a capex of € 212.4 million and include the purchase of some iconic land plots in the vicinity of Paris and Frankfurt.

  • 24 projects delivered during the year representing 641,000 m², or € 42.3 million in additional annual rent (of which 12 projects totalling 330,000 m² delivered during the 2H 2023), currently 100% let. As a result, net rental income, on a look through basis[4], grew 48%, from € 107.4 million to € 159.1 million, knowing that at year-end € 304 million (€ +66 million y.o.y), or € 194.3 million on a proportional look through basis, has become cash generative.

  • 26 projects under construction representing 774,000 m² (of which 23 projects totalling 600,000 m² started up during the year) and € 51.9 million in additional annual rent once fully built and let. The pipeline under construction is 77.3% pre-let. Pre-let ratio lowered as a result of certain speculative assets that initiated construction in Q4 ’23 following amongst others a decline in construction costs.

  • Property portfolio[5] virtually fully let with occupancy at 99% (compared to 99 % as at 31 December 2022). 75.9 % of the completed portfolio is certified, amongst other a DGNB Platinum has been awarded for VGP Park Laatzen, the first German property developed and owned by a developer.

  • Photovoltaic (PV) capacity grew 79.9% YoY with operational capacity passing the 100 MWp-mark at 101.8 MWp (vs. 56.6MWp in Dec-22). 69.0 MWp PV projects under development and a further 99.7 MWp being planned. The ongoing transition to green energy consumption in our buildings, as well as other eco-efficiency measures contributed to the four-star GRESB developer rating, the second highest among peers in the European logistics segment.

  • Solid balance sheet with € 400 million undrawn credit facility availability and lower debts of € 375 million following repayment of two bonds in April and September. Finally, VGP was able to obtain a credit facility of the European Investment Bank of € 150 million to support its renewable energy business unit. As per 5 February 2024, VGP has drawn € 135 million of the facility at an interest rate of 4.15% on a ten-year period.

  • Certain important events occurred after the balance sheet date. It concerns the sale of VGP’s stake in the LPM Joint Venture in Q1 ’24, whereby VGP recycled approximately € 170 million of gross proceeds. VGP also acquired its First Danish land plot located in Vejle.

  • The board of directors proposes an ordinary dividend of € 80.5 million (+ 7.3% versus last year), as well as an extraordinary € 20.5 million top-up following the record net cash recycling with the existing and new Joint Ventures in ‘23. This brings the total annual gross dividend to € 101 million, or € 3.70 per share.

 

[1]        Including Joint Ventures at 100%. As at 31 December 2023 the annualized committed leases of the Joint Ventures stood at € 225.1 million.

[2]        Including Development Joint Ventures at 100%

[3]        Includes 720,000 m2 of land sold in LPM Joint Venture

[4]        Refer to “supplementary notes”, income statement proportionally consolidated

[5]        Including Joint Ventures at 100%