Aroundtown Sa U/Adr

Good morning, everybody. Thank you for joining us for Around Town's nine-month 2025 results call. You can view the presentation on Around Town's website, either on the home section or on the financial reports of the investor relations section. Guiding you through the presentation today, CFO Jonas Tiltelnot, Executive Director Frank Rosin, Chief Capital Markets Officer Timothy Wright, Chief Sustainability Officer Limor Berman, Deputy CEO Kamal Deepman-Aktala and representatives from Grand City Properties are also present. For the duration of the call, all participants will be on listen-only mode. Following our presentation, you will have the opportunity to ask questions. With that, I would like to hand over to Barak and the rest of the team who will guide you through the presentation of our results.

Good morning and thank you for joining us for our nine-month 2025 results presentation. Our portfolio continues to perform well, with the majority of the portfolio at 56% of residential and hotels, achieving strong operational results, benefiting from strong market tailwinds, paired with our ability to identify and extract upside potential. The office portfolio at 38% remains stable, although the economy continues to lag. Nevertheless, we see the outlook is improving, and we continue extracting positive rent-like-for-life performances. In addition, our conversion potential is increasing as we continue to identify more opportunities with the new regulation in Germany, especially the Bau-Turbo, further supporting conversion to residential, thus providing us more optionality to extract upside potential. We see the general sentiment continuing to improve and the economy is expected to move to a more positive territory next year, as expected by the German government supported by the large stimulus package. Government stimulus programs are expected to drive investment in critical infrastructure and renewed private sector activity is beginning to show in the macro data. Meanwhile, a stabilizing interest rate environment is positively impacting capital markets, creating a more supportive financial climate. We see these as encouraging signs. Germany's transaction market is also showing signs of recovery. and we are seeing an uptick in transaction activity, including some larger deals. However, this recovery remains uneven as smaller and less liquid players continue to face refinancing challenges, which may create growth opportunities for us. Here today, we have also executed several capital market transactions, which include senior bond issuances, together with tender offers, as well as the recent successful perpetual no transaction executed a few weeks ago. In the perpetual transaction, we refinanced high-coupon perpetuals with a cheaper one, and on top reduced our perpetual balance, thereby reducing coupon payments and supporting FFO. This deal attracted strong investor demand and positive feedback, reinforcing our strong access to the capital market. We continue to focus on extracting our internal growth potential, and together with our recent proactive activities in the capital markets, positioning us strongly for the opportunities ahead. On slide four, we present the key financial highlights for the first nine months of 2025. Net rental income amounted to 886 million euros, increasing slightly compared to nine months 2024, supported by a solid like-for-like rental growth of 3.1%, and more than offsetting the impact of net disposals. Adjusted EBITDA amounted to €715 million, slightly lower by 1% compared to nine months 2024. FFO1 amounted to €221 million, down from €236 million in the comparable period, mainly due to higher perpetual note attribution and a lower contribution from JVs, which offset operational growth. In H1 2025, the portfolio was externally revalued, showing a positive like-for-like value change of 1.4% compared to December 24, mainly driven by strong operational performance. The portfolio will be fully revalued again as part of the year-end report. EPR and TA per share amounted to 7.8 euros, higher by 5% compared to December 24. We are making ongoing progress towards obtaining green certificates for our assets, with 62% of our commercial portfolio now green certified, including 73% of offices and 60% of hotel assets. Liquidity remains solid at €2.7 billion, despite significant debt repayments during the period, with gross debt reducing by €1.1 billion during the nine-month period. LTV stands at 41%, well below our internal Board of Directors guidance of 45%, and maintaining wide covenant headroom. Jonas, please continue on the next slide.

Slide 5 highlights our recent perpetual notes issuance and buyback. This transaction involves issuing €700 million in new perpetual notes at a 5% to 5% coupon, including a €200 million tap, while buying back €1.2 billion of perpetual notes with an average coupon of 7%. through the concurrent tender as well as redemption calls following the transaction. The rationale behind this transaction was to reduce coupon payments. We achieved this by replacing higher-coupon perpetual notes with new, lower-coupon notes, thereby reducing our analyzed coupon payments. In addition, we were able to reduce the total balance of the outside perpetual notes due through this transaction by 510 million euros. As a result, annualized coupons will decrease by approximately €15 million, supporting FFO while significantly lowering our interest expenses under S&P's methodology. Overall, this accretive transaction strengthens our credit metrics, improves our financial position, and will assist in keeping our FFO level going forward. On slide 6, we present a summary of the outcome of the petrol note transaction on a line-by-line basis. highlighting here the reduction in the balance by 510 million euros and the decrease in average coupon of the specific notes from 7% before the exercise to 5.6% after. In the appendix, we provide an updated list of all our outstanding perpetual notes post-transaction. Moving to slide 7, where we give a summary of our bond issuances since July 24, highlighting the strong progress we've made in reducing the marginal cost of debt over this period. In July 24, our Series 40 senior bond was issued with a coupon of 4.8%, while GCP issued 500 million Series Y bonds at a coupon of 4.375%. At that time, these were our first issuances after several years, marking our return to the capital markets. By May 25, we were able to issue a Series 41 bond at a much lower coupon of 3.5%, and in September 25, the coupon for the Series 42 decreased further to 3.25%. In November, we also issued new CHF bonds to proactively refinance the upcoming maturity of our Series X CHF bond in Q1 next year. The Series X was issued in 2019, so before the pandemic and period of high interest rates, and carries a coupon of 1.72%, while the new Series 43 CHF bond was issued at an even lower rate of 1.5%. Tim, please continue the next slide.