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2Q10

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2Q10

  1. 1. 2Q10 Earnings Release August 12th, 2010 BRProperties
  2. 2. BRProperties 2Q10 Highlights 2 Financial Highlights Operating Highlights  We have reached 60% of the acquisition goal proposed in the capital budget in just 4 months after the Company’s IPO. During the period, we acquired the following properties: CBOP – Ed. Jacarandá, DP Louveira 3, 4, 5, 6, 8 & 9, RB 115 and Ed. Manchete for a total investment value of R$ 872 million  At the end of 2Q10, our portfolio had 993.143 sq m of gross leasable area (GLA), a 36% increase compared to the same period of 2009  Increase in the number of managed properties, from 24 in 2Q09 to 28 in 2Q10  Our property management revenues increased by 63% in 2Q10 compared to 2Q09  Consolidation of the financing strategy utilizing real estate financing, which represents 92% of our total debt; R$ 168 million in new financing was raised during the quarter  2Q10 gross revenues increased by 39% compared to 2Q09  Adjusted EBITDA, excluding stock option plan expenses and bonus provision, of R$ 35.5 million at the end of 2Q10, an increase of 43% over 2Q09  2Q10 adjusted EBITDA pro-forma of R$ 46,5 million, with an 87% EBITDA margin  Net income of R$ 19,3 million, an 83% increase over 2Q09  Consolidated FFO totaled R$ 25,5 million, with a 57% FFO margin
  3. 3. BRProperties 2Q10 Recent Acquisitions  On June 2nd 2010, we acquired the commercial office building RB 115, located in the downtown region of Rio de Janeiro/RJ for R$ 94,1 million Property Overview: GLA: 11.345 sq m % Acquired: 90% # floors: 20 Complete retrofit under way  On June 17th 2010, we acquired, for R$ 157 million, 2 warehouses located in the logistics complex DP Louveira, where the Company already owned 6 other properties Property Overview: GLA: 88.643 sq m % Acquired 100% # warehouses: 2 92% leased  On June 30th 2010, we acquired, for R$ 260 million, the Manchete office building in the Flamengo region of Rio de Janeiro/RJ Property Overview: GLA: 26.439 sq m % Acquired: 100% # floors: 12 Complete retrofit under way Edifício RB 115 DP Louveira 8 & 9 Edifício Manchete 3
  4. 4. BRProperties 2Q10 Portfolio Portfolio Growth (GLA sq m) Portfolio Breakdown (% market value) Portfolio Breakdown (% GLA) 4 54% 42% 1% 3% Office Industrial Other Development 26% 74% 1% Office Industrial Other 730.548 993.143 31.954 106.306 11.345 88.643 (2.091) 26.439 1Q10 Acquisition Ed. Jacarandá Acquisition DP Louveira 3,4,5,6 Acquisition RB 115 Acquisition DP Louveira 8,9 Sale 50% Ed. Souza Aranha Acquisition Ed. Manchete 2Q10
  5. 5. BRProperties 2Q10  BR Properties has already invested R$ 872 million, or 60%, of the total acquisition value outlined in the capital budget  It is also important to mention that we are currently 35% above the acquisition goal which was established for 2010 Acquisitions Acquisition CAPEX Schedule Post IPO Post IPO Acquisitions 5 872 mar/10 abr/10 mai/10 jun/10 jul/10 ago/10 set/10 out/10 nov/10 dez/10 Capital Budget Actual 1.452 645 872 mar/10 abr/10 mai/10 jun/10 jul/10 Capital Budget Actual +35%
  6. 6. BRProperties 2Q10  Our financial vacancy was 10.4% in the period; Excluding Ed. Jacarandá, of which we only paid an advance of 18%, and TNU, which is currently under retrofit, our financial vacancy is currently 3.0% Operating Highlights Vacancy Breakdown  Despite the recent increase in our portfolio vacancy, the lease-up outlook for the vacant areas is very positive given the increased demand and most importantly the high quality of our properties  We expect the portfolio vacancy to return to its historic levels in the short term Vacancy per Property 6 6,0% 6,6% 3,7% 8,3% 10,4% 3,0% 1Q10 2Q10 2Q10 Ex CBOP & TNU Physical Financial 4,1% 3,3% 1,0% 0,9% 0,6% 0,3% 0,2%0,1% Castelo Branco Office Park TNU Piraporinha Cond.Ind.São José dos Campos DP Louveira 9 Raja Hills Plaza Centenário
  7. 7. BRProperties 2Q10 % Revenues % GLA % GLA 2% 5% 6% 37% 49% 2010 2011 2012 2013 >2013 1% 7% 9% 34% 51% 2010 2011 2012 2013 >2013 % Revenues 20% 41% 24% 13% 1% 2010 2011 2012 2013 >2013 19% 47% 24% 9% 1% 2010 2011 2012 2013 >2013 Lease Contract 3 Year Market Alignment Schedule Lease Contract Expiration Schedule 7 Operating Highlights
  8. 8. BRProperties 2Q10 Managed Properties Property Management Revenues 24 28 2T09 2T10 16% 529 863 2T09 2T10 63% 8 Operating Highlights
  9. 9. BRProperties 2Q10 Net Revenues Adjusted EBITDA Net Income FFO 9 Financial Highlights 31.989 44.889 53.223 59.270 86.489 110.701 2Q09 2Q10 2Q10 Pro Forma 6M09 6M10 6M10 Pro Forma 40% 19% 66% 46% 28% 87% 26.735 38.202 46.536 50.995 73.639 97.851 2Q09 2Q10 2Q10 Pro Forma 6M09 6M10 6M10 Pro Forma 43% 22% 44% 33%74% 92% 10.537 19.305 17.553 31.064 2Q09 2Q10 6M09 6M10 83% 77% 14.649 25.550 25.786 42.187 2Q09 2Q10 6M09 6M10 74% 64%
  10. 10. BRProperties 2Q10 Pro-Forma Estimates Additional Pro-forma Gross Revenues (non audited) Adjusted EBITDA (non audited) Methodology  Considers that the in place revenues for the properties acquired throughout 2010 were incurred since the beginning of the year Results  2Q10 adjusted EBITDA pro-forma totaled R$46,5 million, 22% above 2Q10 adjusted EBITDA  6M10 adjusted EBITDA pro-forma 6M10 totaled R$97,8 million, 33% above 6M10 adjusted EBITDA  Adjusted EBITDA pro-forma margin of 87% and 88% in 2Q10 and 6M10, respectively 10 49.237 57.987 726 - 675 2.381 1.383 3.585 2Q10 Actual BBP DP Araucária TNU Ed. Jacarandá Louveira 3-6 Louveira 8-9 2Q10 Pro-forma 38.201 46.536 73.639 97.851 85% 87% 85% 88% 65% 70% 75% 80% 85% 90% 25.000 35.000 45.000 55.000 65.000 75.000 85.000 95.000 105.000 2Q10 Actual 2Q10 Pro- forma 6M10 Actual 6M10 Pro- forma EBITDA Margin
  11. 11. BRProperties 2Q10 Debt Debt Amortization Schedule Net Debt 2Q10 Debt Index Breakdown  Comfortable amortization schedule in the next few years, with low refinancing risk 92% 4%4% TR IGPM CDI 41.886 59.665 75.989 70.399 93.016 89.560 99.408 242.290 59.921 48.411 14.632 1.027 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 11 112 955 558 59 784 396 STDebt Obligations for Acquisitions LTDebt TotalDebt Cash NetDebt
  12. 12. BRProperties 2Q10 Glossary EBITDA (Earnings Before Income, Tax, Depreciation and Amortization): a non accounting measure which measures the Company’s capacity to generate operational revenues, without considering its capital structure. Measured by excluding the operational expenses from Gross Profit and adding back the depreciation and amortization expenses for the period (Gross Profit – General and Administrative Expenses + Depreciation + Amortization) Adjusted EBITDA: adjustments made to EBITDA by excluding R$ 0.2 million from expenses regarding the Company stock option plan, along with R$ 1.1 million in employee bonus provisions FFO (Funds From Operations): non accounting measure, which adds back depreciation to net income in order to determine, utilizing the income statement, the net cash generated in the period (Net Income + Depreciation) Vacancy - Financial: estimated by multiplying the average rent per sqm which could be charged in the buildings and their respective vacant areas, and then dividing this result by the potential gross revenues of each property. Indicates the percentage of potential revenue which is lost each month due to vacancy Vacancy - Physical: estimated by dividing the total vacant area by the total GLA of the portfolio - 12 -
  13. 13. BRProperties 2Q10 IR Contacts Investor Relations Pedro Daltro CFO & Investor Relations Officer Leonardo Fernandes Investor Relations Manager Marcos Oliveira Investor Relations Analyst Phone: (55 11) 3201-1000 Email: ri@brpr.com.br www.brpr.com.br/ri 13

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