3 q13 br properties   earnings release presentation
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3 q13 br properties   earnings release presentation 3 q13 br properties earnings release presentation Presentation Transcript

  • 3Q13 Earnings Release Presentation
  • Highlights 3Q13 HIGHLIGHTS AND SUBSEQUENT EVENTS • 3Q13 net revenues totaled R$236.6 million, an increase of 41% over 3Q12, when net revenues came in at R$168.0 million. The significant growth resulted from additional rental revenues of properties delivered throughout the last twelve months; • 3Q13 adjusted EBITDA of R$218.2 million, a 47% increase over 3Q12, and adjusted EBITDA margin of 92%; • 3Q13 net income totaled R$89.6 million, impacted by a gain on appraisal of investment properties of R$44.4 million; • 3Q13 adjusted FFO, excluding non-cash expenses, totaled R$74.7 million, a 171% increase over 3Q12, and adjusted FFO margin of 32%; • The Company ended 3Q13 with a 5.2x Net Debt/Adjusted EBITDA, a reduction of 29% relative to 3Q12, when the ratio was 7.3x. The cash position totaled R$839.7 million, a 213% increase over the same period of last year; • In August, the Company amortized a R$258 million loan which cost was CDI + 1.50% p.a.; • Average net of inflation leasing spread (office + industrial) reached 1.7% in 3Q13, representing an increase of R$102 thousand a month in rent revenues; • At the end of October, financial and physical vacancy were at 9.7% and 4.9%, respectively. Excluding the recently delivered Paulista Building and the JK Towers, currently under lease-up, stabilized financial and physical vacancy would drop to 3.2% and 2.8%, respectively; • The Company leased-up 12,773 sqm throughout the quarter, representing a R$866 thousand increment in rent revenues on a monthly basis; • 3 asset sales were completed in 3Q13: Pateo Bandeirates Building was sold for R$442.0 million, representing a cap rate of 8.4%; Plaza Centenário Building was sold for R$13.7 million, representing a cap rate of 9.6%; and Galpão (warehouse) Sorocaba was sold for R$26.4 million, representing 10.2% cap rate. BR Properties has sold its entire stake in the 3 properties; • Lastly, the Company delivered DP Louveira 7, a high-quality fully leased major warehouse located 70km from São Paulo Capital. 3Q13 2
  • Portfolio Portfolio Market Value 3Q13 Revenue Breakdown Asset sales in the amount of R$482.1 million 64% Straight-line 4% Leasing 95% 6% Services 1% 11.715 1Q12 12.968 13.552 2Q12 3Q12 13.840 14.096 14.031 13.759 30% 4Q12 1Q13 2Q13 3Q13 Portfolio Breakdown (% market value) Portfolio Breakdown (% GLA) 5% 5% 18% 25% 49% 14% 63% 21% Of f ice AAA Of f ice Industrial Of f ice AAA Retail 3 Of f ice Industrial Retail 3Q13
  • Portfolio Recycling The company completed 3 asset sales in the amount of R$482.1 million at an average cap rate of 8.5% Pateo Bandeirantes Type: Class AAA Office City: São Paulo / SP Gross Leasable Area: 17,458 sqm Sale Price: R$442.0 million Cap Rate: 8.4% Galpão Sorocaba Type: Industrial City: Sorocaba / SP Gross Leasable Area: 14,797 sqm Sale Price: R$26.4 million Cap Rate: 10.2% Plaza Centenário Type: Class A Office City: Curitiba / SP Gross Leasable Area: 3,366 sqm Sale Price: R$13.7 million Cap Rate: 9.6% 3Q13 4
  • Financial Highlights Net Revenues (R$ thousand) Net Income* (R$ thousand) (78%) 63% 41% (65%) 700.716 1.044.336 430.159 168.031 236.575 259.234 230.295 89.555 3Q12 3Q13 9M12 9M13 3Q12 3Q13 9M12 9M13 * 3Q12 Net Income was largely impacted by a gain on appraisal of investment properties of R$382.7million, after the acquisition of One Properties. 3Q13 5
  • Financial Highlights Adjusted EBITDA (R$ thousand) 92% 88% 88% 93% 73% 47% 651.488 376.546 148.297 3Q12 218.151 3Q13 9M12 9M13 Adjusted EBITDA Margin EBITDA Composition Net Income (loss) (+) Deferred Taxes (+) Income and Social Contribution Taxes (-) Minority Interest (+) Depreciation (+) Net Financial Result EBITDA EBITDA Margin 3Q13 89.555 (18.278) 29.125 3.086 50 139.526 243.064 103% 3Q12 259.234 150.588 17.293 (620) 103.507 530.002 315% var % -65% -112% 68% n/a -108% 35% -54% -213 p.p. 9M13 230.295 29.469 50.821 (3.511) 274 450.567 757.916 108% 9M12 1.044.336 648.611 34.382 210 304.340 2.031.879 472% var % -78% -95% 48% n/a 31% 48% -63% -364 p.p. Adjusted EBITDA Composition EBITDA (-) Gain (Loss) on Appraisal of Investment Properties (-) Gain (Loss) on Sale of Investment Properties (+) Other Operating Income (+) Stock options (+) Bonus Provision Adjusted EBITDA Adjusted EBITDA Margin 3Q13 243.064 (44.449) 548 17.452 387 1.149 218.151 92% 3Q12 530.002 (382.650) (2.156) 1.218 735 1.149 148.297 88% var % -54% -88% -125% 1333% -47% 0% 47% 4 p.p. 9M13 757.916 (133.269) (1.702) 23.662 1.435 3.447 651.488 93% 9M12 2.031.879 (1.667.045) 6.369 (898) 2.795 3.447 376.546 88% var % -63% -92% -127% -2734% -49% 0% 73% 5 p.p. 6 3Q13
  • Financial Highlights Adjusted FFO (R$ thousand) 16% 32% 19% 34% 196% 171% 240.681 81.191 74.674 27.539 3Q12 3Q13 9M12 9M13 Adjusted FFO Margin Adjusted FFO Composition Net Income (loss) (+) Deferred Taxes (+) Income Taxes on Property Sales (+) PIS/Cofins (Revenue Taxes) on Property Sales (-) Gain (Loss) on Appraisal of Investment Properties (-) Gain (Loss) on Sale of Investment Properties (+) Non-cash Losses on Exchange Rate Variation (-) Non-cash Gains on Exchange Rate Variation (+) Non-cash Variations on Derivative Instruments (-) Minority Interest Adjusted FFO Adjusted FFO Margin 3Q13 89.555 (18.278) 15.821 16.936 (44.449) 548 45.463 (41.590) 7.581 3.086 74.674 32% 3Q12 259.234 150.588 172 (382.650) (2.156) 7.964 (5.613) 27.539 16% var % -65% -112% n/a 9771% -88% -125% 471% 641% n/a n/a 171% 15 p.p. 9M13 230.295 29.469 16.453 17.125 (133.269) (1.702) 118.773 (64.603) 31.651 (3.511) 240.681 34% 9M12 1.044.336 648.611 3.052 1.239 (1.667.045) 6.369 98.823 (54.194) 81.191 19% var % -78% -95% 439% 1283% -92% -127% 20% 19% n/a n/a 196% 15 p.p. 3Q13 7
  • Indebtedness 3Q13 Net Debt (R$ mn) 4.950 3Q13 Debt Profile 1% 5.369 840 4.530 6% 11% TR CDI IGPM INPC IPCA 43% 409 10 ST Debt Obligations f or Acquisitions 40% LT Debt Total Debt Cash Net Debt Indebtedness Short Term Loans and Financing Loans and Financing Perpetual Bond Derivative Instruments Payables for Acquisition of Real Estate Long Term Loans and Financing Loans and Financing Perpetual Bond Gross Debt Cash and Cash Equivalents Net Debt Portfolio Value Gross Debt / Portfolio Value (Loan to Value) Net Debt / Portfolio Value (Loan to Value) Adjusted EBITDA / Net Financial Expenses * Duration (years) Unsecured Debt / Total Debt 3Q13 419.014 343.937 65.371 9.706 4.950.385 4.364.953 585.432 5.369.399 839.730 4.529.669 13.759.034 39% 33% 1,7x 4,4 30% * Considering Net Financial Expenses (ex. non-cash variations) 8 2Q13 679.678 603.183 64.949 11.547 5.003.863 4.422.211 581.652 5.683.541 660.598 5.022.943 14.096.206 40% 36% 2,0x 4,4 28% var % -38% -43% 1% n/a -16% -1% -1% 1% -6% 27% -10% -2% -1 p.p. -3 p.p. -14% 0% 2 p.p. 3Q13
  • Indebtedness Debt Amortization Schedule (R$ million) Net Debt / Adjusted EBITDA 895 9,7x 785 7,8x 7,0x 512 6,7x 6,0x 4,9x 332 335 5,7x 5,6x 5,5x 3,7x 266 7,3x 3,2x 5,2x 3,4x 186 94 65 2013 2014 2015 2016 2017 2018 2019 2020 2021 75 2022 70 2023 72 64 2024 2025 0,6x 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 Principal Net Debt/EBITDA Loan to Value: Gross and Net Interest Coverage Ratio 3,5x 3,0x 2,7x 2,5x 2,4x 2,5x 2,1x 2,0x 1,6x 1,4x 1,5x 1,5x 1,7x 38% 1,7x 40% 40% 45% 43% 42% 41% 40% 39% 37% 38% 39% 35% 34% 24% 1,1x 36% 4% 23% 21% 36% 35% 30% 21% 40% 34% 36% 34% 39% 33% 21% 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 LTV Gross Debt EBITDA / Net Financial Expenses LTV Net Debt 3Q13 9
  • Interest Rates Variation of BRPR Average Cost of Debt vs Variation of CDI Rate (bps) 99 71 (46) 11 (62) 10 (10) 3Q12 - 0 Base 4Q12 (23) 1Q13 2Q13 Variation of BRPR Average Cost of Debt BRPR Cost of Debt vs Interest Rates BRPR Average Cost of Debt Variation QoQ (bps) CDI Rate Variation QoQ (bps) 3Q12 11,53% 7,36% - 3Q13 Variation of CDI Rate (bps) 4Q12 10,91% (62) 6,90% (46) 1Q13 10,81% (10) 7,01% 11 2Q13 10,57% (23) 7,72% 71 3Q13 10,67% 10 8,71% 99 Impact of Interest Rates Hike in FFO Total Debt - 3Q13 5.401.044 Nominal Average Cost of Debt - 3Q13 10,67% Annual Pro-Forma Interest Expenses 576.291 Table below assumes a 100 bps increase in the CDI Rate Total Debt - 3Q13 5.401.044 Nominal Average Cost of Debt - 3Q13 (Post Increase) 11,09% Annual Pro-Forma Interest Expenses 598.967 Annual Post Tax Impact in FFO * (14.966) * Tax Rate of 34% Sensitivity Analysis CDI Rate BRPR Average Cost of Debt Variation on BRPR Debt (bps) Reduction -300 bps -200 bps -100 bps 9,43% 9,84% 10,26% -125 bps -83 bps -42 bps 10 3Q13 8,71% 10,67% 0 bps 100 bps 11,09% 42 bps Increase 200 bps 300 bps 11,51% 11,92% 83 bps 125 bps 3Q13
  • Operating Highlights Leasing Spreads Leasing Spread 3Q13 Leasing Spread - Office 8,8% Renegotiated GLA (sqm) 3Q12 22,3% 9M13 9M12 10,2% 25,7% 27.827 12.997 38.249 53.038 5% 3% 6% 11% % Office portfolio Gain/(Loss) of Monthly Rent (R$ thousand) 345 Leasing Spread - Industrial -11,5% Renegotiated GLA (sqm) 148 484 727 18,0% -7,9% 7,3% 121.630 24.521 149.647 87.156 % Industrial portfolio 10% 2% 12% 8% Gain/(Loss) of Monthly Rent (R$ thousand) Leasing Spread - Retail Renegotiated GLA (sqm) % Retail portfolio (243) n/a 0% 77 n/a 0% (201) n/a 0% 110 n/a 0% Gain/(Loss) of Monthly Rent (R$ thousand) - - Lease Contracts 5.8 Years Build-to-Suit Contracts - Duration All Contracts - 7.2 Years Lease Contract Expiration Schedule (% Revenues) Lease Contract 3 Year Market Alignment Schedule (% Revenues) 11% 75% 32% 5% 2013 12% 4% 8% 2014 2015 2013 >2016 15% 2014 2015 >2016 3Q13 11
  • Operating Highlights Vacancy Evolution Financial Vacancy per Segment 10,3% Physical 10,8% 10,0% 9,2% 10,5% Financial Industrial 9,7% 8,9% Of f ice Retail 5,5% 4,0% 4,7% 5,3% 4,9% 2,6% 0,5% 4Q12 1Q13 2Q13 3Q13 October 2Q13 0,0% 0,5% 0,0% 3Q13 0,5% 0,0% October Vacancy per Property 3Q13 Property Ed. Jacarandá Ventura - West Tower Icomap RB115 Manchete JK Complex - Towers D&E Cidade Jardim Paulista Santo Antonio Raja Hills Brasília Total Office BP Jandira BP Jundiaí DP Louveira #9 BBP Barão de Mauá-Brahms Gaia Terra Andiroba Cond.Ind.SJC Total Industrial Total Portfolio Type Office Office Office Office Office Office Office Office Office Office Office Industrial Industrial Industrial Industrial Industrial Industrial Financial 0,1% 0,3% 0,0% 0,1% 1,2% 5,5% 0,6% 1,3% 0,0% 0,1% 0,6% 10,0% 0,1% 0,1% 0,1% 0,0% 0,1% 0,0% 0,5% 10,5% 12 Physical 0,1% 0,1% 0,1% 0,1% 0,5% 1,7% 0,2% 0,5% 0,0% 0,1% 0,4% 3,8% 0,2% 0,4% 0,4% 0,1% 0,3% 0,1% 1,6% 5,3% October Financial Physical 0,1% 0,1% 0,3% 0,1% 0,0% 0,1% 0,1% 0,1% 1,2% 0,5% 5,5% 1,7% 0,6% 0,2% 1,0% 0,4% 0,0% 0,0% 0,1% 0,1% 0,2% 0,1% 9,2% 3,3% 0,1% 0,2% 0,1% 0,4% 0,1% 0,4% 0,0% 0,1% 0,1% 0,3% 0,0% 0,1% 0,5% 1,6% 9,7% 4,9% 3Q13
  • Capital Markets Stock Performance – 9M13 15% ADTV BR Properties Ibovespa 80.000.000 70.000.000 5% 60.000.000 50.000.000 -5% 40.000.000 -15% 30.000.000 20.000.000 -25% 10.000.000 -35% Jan-13 Feb-13 Mar-13 Stock Performance (BRPR3) Total Number of Shares Apr-13 May-13 Jun-13 3Q13 3Q12 Jul-13 var % Jul-13 Sep-13 Aug-13 9M13 9M12 var % 312.653.445 310.307.396 1% 312.653.445 310.307.396 1% 99% 99% 0% 99% 99% 0% Stock Price (average for the period) 18,92 23,80 -20% 21,51 22,48 -4% Stock Price (end of period) 19,70 26,45 -26% 19,70 26,45 -26% Market Cap end of period (R$ million) 6.159 8.208 -25% 6.159 8.208 -25% Free Float (%) Average Daily Trading Volume (R$ million) Average Daily Traded Shares Average Daily negotiations 41,49 24,77 2.207.791 1.057.065 6.456 4.074 68% 109% 58% 43,60 27,79 57% 2.103.783 1.237.891 70% 6.493 3.550 83% 3Q13 13
  • IR Contacts Investor Relations Pedro Daltro CFO & Investor Relations Officer Marcos Haertel Investor Relations Manager Gabriel Barcelos Investor Relations Analyst Phone: (55 11) 3201-1000 Email: ri@brpr.com.br www.brpr.com.br/ri 3Q13 14