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3 Q07 Earnings Presentation
 

3 Q07 Earnings Presentation

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    3 Q07 Earnings Presentation 3 Q07 Earnings Presentation Presentation Transcript

    • Presentation – 3Q07 Results November 13 2007 N b 13, 1
    • 3Q07 Highlights Carlos Medeiros - CEO 2
    • 3Q07 Highlights g g During the 3Q07 BRMALLS concluded 9 transactions, adding 7 new malls to its ownership portfolio Throughout the year, we concluded 32 transactions, adding 21 new malls to our portfolio During the quarter, BRMALLS announced three Greenfield projects in the state of São Paulo and 12 expansions quarter Total GLA and Total Owned GLA increased by 25% and 35% respectively, considering Greenfield projects and expansions Throughout the year, BRMALLS raised R$2 6 billion in the financial markets R$870 million during the 3Q07 year R$2.6 markets, We have reduced our total cost of debt by 200 basis points since the beginning of the year Our focus in the continuous improvement of processes, systems and controls is already being reflected in our margins NOI Margin increased from 77.4% to 84.4% year on year Our net revenues totaled R$59.3 million in the 3Q07, R$131.5 million in the 9M07 and R$200.5 in the pro forma 9M07 An increase of 212% compared to the 3Q06 and 134% against the 9M06 Adjusted EBITDA1 totaled R$ 42.5 in the 3Q07 and R$ 92.4 million in the 9M07. Adjusted pro forma EBITDA, was equal to R$ 57.7 million in the 3Q07 and R$ 148.2 million in the 9M07. Adjusted EBITDA increased by 257% against the 3Q06 and 157% against the 9M06 1 Calculated excluding the effects of non recurring expenses related to the IPO, to new acquisitions and to corporate restructuring. Adjusted EBITDA also includes the proceeds from the debentures of Shopping Araguaia 3
    • Acquisitions Carlos Medeiros - CEO 4
    • Acquisitions 3Q07 Highlights Ownership interest acquired throughout the 3Q07 Addition of 7 new malls to our portfolio (Ow ned GLA) 31,857 Additional Total GLA: 147,157 m² , Additional Owned GLA: 77,182 m² 16,748 11,619 Additional Marginal NOI: R$ 68.6 mm 6,635 3,521 3,553 Average IRR: 15 0% (nominal unleveraged) 15.0% (nominal, 2,290 281 679 1.0% 13 0% 13.0% 100.0% 100 0% 82.4% 82.5% 100 0% 100.0% 2.4% 12.9% 17.5% 5
    • Acquisitions A d d itio n a l O w n e d G L A s in c e O c t/0 6 Acquisitions Highlights 369,397 77,182 5 ,8 7 4 Addition of 21 new malls to our portfolio 76,186 74,756 Additional Total GLA :554,341 m² 1 2 4 ,1 6 7 11,233 Additional Owned GLA :245,230 m² Additional Marginal NOI 07 : R$ 136.3 mm 136 3 1 O r ig in a l oct/06 1Q 07 2Q 07 3Q 07 Su b s e q u e n t C urrent to 3Q 07 Average IRR: 15.3% (nominal, unleveraged) 1 9 7 .5 % Additional ownership interest acquisitions’ highlights From the 33 transactions announced, 12 were additional ownership interest acquisitions We increased our ownership interest in 10 malls Initial 30.0% 38.7% 9.5% 11.1% 16.6% 35.9% 20.0% 26.9% 82.5% 82.4% Additional Total GLA :35,323 m² Stake Final Additional Marginal NOI 07 : R$19.6 mm St k Stake 65 0% 65.0% 49.6% 49 6% 11 5% 11.5% 17.2% 17 2% 34 2% 34.2% 45 0% 45.0% 35.0% 35 0% 39 7% 100 0% 100 0% 39.7% 100.0% 100.0% Average IRR: 18.9% (nominal, unleveraged) 1 –NorteShopping expansion concluded in January/07 6
    • Case Study - Shopping Tamboré We have managed to add value to the mall by achieving operational improvements, increasing the already planned expansion and better negotiating the exploration of the commercial towers Operational improvements: Increase in expansion potential: Auditing Efforts – increase in rent revenue We increased the shopping expansion from 15,276 m² Parking outsourcing – increase in parking results to 27,000 m² These improvements have already reflected in the Better Terms in the Commercial Towers NOI: 6-mo anticipation of the launching of the 1st tower R$ 000 30% increase in the size of all towers 39.7% Increase in 7.0% in price/m² 26.5% 4.3 9.7% Increase of 3.0% of land swap value 3.4 3.1 Total Price: R$ 221.5 million (IRR: 15.5% a.a.) Estimated Present Value using same IRR: 278.9 million1 Increase of 25.9% in value improvement 3Q06 NOI Projected 3Q07 NOI 3Q07 NOI 1 –Same Discount rate 7
    • New Developments and Expansions Carlos Medeiros - CEO 8
    • New Developments Throughout the 3Q07, BRMALLS announced three new Greenfield projects in the state of São Paulo MOOCA Project Details ► GLA: 43,000 m² ► Ownership: 60% ► Expected IRR: 23,1% p.a (unleveraged) ► Total Investment: R$ 156 million By 2009, the three GRANJA VIANNA developments will jointly add: ► GLA: 30,800 m² ► Ownership: 60% p -Total GLA: 101,872 m² a 12% Total 101 872 ► Expected IRR: 24.6% p.a increase over total GLA (unleveraged) ► Total Investment: R$ 105 million -Owned GLA: 68,123 m² a 18% increase over owned GLA BAURU ► GLA: 28,000 m² ► Ownership: 85% ► Expected IRR: 20.2% p.a (unleveraged) ► Total Investment: R$ 63 million 9
    • Expansion As we increase the number of malls in our portfolio, we multiply the expansion opportunities in our existing malls, with excellent risk x return profile 36,002 ► Increases traffic in the entire mall 61,862 , ► Better store mix with a higher % of satellite vs 25,764 anchor 0,095 ► Constructed upon demand ► Knowledge of consumer habits and spending 369,397 patterns ► Opportunity to increase ownership interest Current Owned GLA 2007 2008 2009 Total GLA from expansions 17% increase in owned GLA 10
    • 3Q07 Financial and Operational Results R lt Leandro Bousquet - CFO 11
    • Fund Raising 3Q07 Highlights R$ Million 3Q07 Q We raised R$ 320 million in local 303 2,569 debenture issue 600 R$550 million bridge loan 550 We reduced our total cost of debt by 320 200 basis points 2007 Highlights 657 140 We raised R$ 1.3 billion in equities, which increased our free float to R$ 1.6 billion1 Bank Loan IPO Debenture Bridge Loan Follow On 1 Perpetual Total We raised R$ 1.3 billion in debt 13 Bond We already invested R$ 1.6 billion 1- Base Stock Price: R$ 25 12
    • 3Q07 and YTD07 Financial Highlights Gross Revenue (R$ 000) 252.9% 51.3% 319.4% 213,086 133.2% 32.6% 140,815 216.2% 20,240 84,889 63,997 60,385 3Q06 3Q07 Proforma P f YTD06 YTD07 Proforma 07 P f 3Q07 Gross Revenue Breakdown Others Minimum 1.1% 59.9% Services 10.5% Transfer Fee Rents 0.4% 71.3% Parking 10.1% Key Money Mall & % of Sales 6.6% Merchandising 5.4% 6.1% 13
    • 3Q07 and YTD07 Financial Highlights Gross Profit (R$ 000) 292.2% 148,768 53.5% 335.7% 155.5% 96,933 36.1% 36 1% 220.2% 56,185 12,894 37,936 41,284 3Q06 3Q07 Proforma YTD06 YTD07 Proforma 07 3Q07 Adjusted FFO (R$ 000) 248.4% 20.9% 69,923 57,826 204.3% 111.2% 316.3% 28,149 3,200 20,071 13,325 3Q06 3Q07 3Q 07 YTD06 YTD07 Proforma 07 Proforma 14
    • 3Q07 and YTD07 Financial Highlights 3Q07 EBITDA and Proforma EBITDA (R$ 000) 72.3% 1 643 1,643 1,336 1 336 336 71 7% 71.7% 62,7% 57,657 39,171 42,486 11,906 3Q06 3Q07 Other non IPO Araguaia Adjusted Proforma recurring EBITDA Adjusted expenses EBITDA YTD EBITDA and Proforma EBITDA (R$ 000) 73.9% 70.2% 6,317 , 5,773 930 148.198 64.0% 79.360 92.380 36.006 YTD06 YTD07 Other non IPO Araguaia Adjusted Proforma EBITDA Margin recurring EBITDA Adjusted expenses EBITDA 15
    • 3Q07 and YTD07 Operational Highlights NOI (R$ 000) NOI/m² (monthly) 128.9% 3.7% 3 7% 103.822 59.5 217.7% 48.366 48 366 . 9 45.349 15.224 57.4 3Q06 3Q07 YTD06 YTD07 3Q06 3Q07 Same Store Sale/m² (monthly) Same Store Rent/m² (monthly) 7.8% 6.0% 853,4 8.6% 49,3 5.9% 791,7 809,3 47,8 46,5 744,9 45,1 3Q06 3Q07 YTD06 YTD07 3Q06 3Q07 YTD06 YTD07 16
    • Disclaimer This document may contain future considerations on BRMALLS’s business p p . p j prospects. These are mere projections and, therefore, based entirely on , , y BRMALLS’s management expectations regarding the future of the business. Such forward-looking statements are subject to risks and uncertainties which depend on factors including economic, political, financial and commercial conditions in the markets where we operate Investors are hereby advised operate. that these forecasts are no guarantee of future performance since they involve risks and uncertainties 17