Half Year 2026 Grand City Properties SA Earnings Call Transcript
Key Points
- Grand City Properties SA (GRNNF) delivered solid operational performance with like-for-like rental growth of 3.3% in H1 2026, driven by strong re-letting and indexation.
- The company maintains a conservative financial profile with a low LTV of 33%, a strong interest coverage ratio of 4.7x, and a substantial liquidity position of EUR1.4 billion.
- External growth was achieved through disciplined acquisitions in Germany and London at attractive rent factors, with a pipeline expected to improve, particularly in London.
- The full refinancing of the perpetual note stack, with next call dates in 2031, provides increased clarity and reduces exposure to market volatility.
- The portfolio recorded a slight positive revaluation of 0.2% like-for-like, driven by operational growth, and the company confirmed its FFO I guidance for 2026.
- The company has a strong balance sheet with 71% of the portfolio unencumbered, ensuring robust access to bank financing and capital markets.
- FFO I decreased to EUR91 million in H1 2026 from EUR95 million in the prior year, impacted by higher perpetual notes attribution and finance expenses.
- The LTV ratio increased to 33% from 31% at year-end 2025, primarily due to acquisitions and investments made during the period.
- Finance expenses rose to EUR37 million, reflecting the full period cost of debt raised in previous periods, which negatively impacted profitability.
- The company faces ongoing geopolitical volatility, particularly from the Middle East situation, which creates uncertainty in financial markets.
- The transaction market has slowed down in recent months due to market volatility, potentially impacting the pace of future capital recycling activities.
- The new perpetual notes carry a significantly higher coupon of 5.25% compared to the redeemed notes at 1.5%, leading to higher perpetual notes attribution of EUR53 million in 2026 and EUR60 million from 2027 onwards.
Good morning, and thank you for joining us for Grand City's results call for the first half of 2026. You can view this presentation on Grand City's website, either on the Home section or under Financial Reports of the Investor Relations section.
With me today will be Chairman and Director, Christian Windfuhr; CEO, Refael Zamir; CFO, Idan Hadad; and CCMO, Michael Bar-Yosef. (Operator Instructions)
With that, I would like to hand you over to Christian to start with the presentation.
Good morning, and welcome to our H1 2026 results presentation. We are pleased to present a solid set of results for the first half of 2026, reflecting another period of strong operational performance.
The economic environment continues to be shaped by ongoing geopolitical developments, including the situation in the Middle East, which create ongoing volatility in financial markets. Our portfolio locations benefit from strong fundamentals, and we do not
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