Immobiliare Grnde Dist Sl

course cooperator. Welcome to IGD's conference call presenting Q1 2026 results. Let me remind you that all participants are in listen-only mode. The presentation will be followed by a Q&A. In order to be assisted by an operator during the conference call, press star and zero on your phone keypad. Let me now turn the conference over to Mr. Roberto Zoya, CEO and General Manager of IGD. Mr. Zoya, please go ahead. Thank you very much. Welcome to all of you. Good afternoon. And let's start straight away so that I can leave more room for your questions. By way of introduction, let me say that this quarterly report confirms the pathway we started in April 2024, when I was appointed together with the new board, and you will see in my presentation that the pathway we started is still giving tangible results and constant and consistent over time. Let's move to page two in the presentation. I wanted to remind you of disposals and Romania. This is a topic we've been discussing a lot, but we've had disposals in the first quarter on 2026, are one and much better than two on the 21st, and the negotiations allowed us to persuade of eight assets for a total of 32.5 million. There are still seven assets to be used on, and the money present, that's Ploiesti Grand Centre, million and alone it's got 40 million and the other six are about 35, 36 million. So the goal for 2026 is the disposal of the six small assets so that in 2027 we can focus on the bigger assets and the more global assets. And then we launched a restyling, external restyling to get it ready for sale, for disposal. And so I reconfirmed our target for 2026 disposals for additional 30 million in line what we had disclosed in our business plan. As far as Romania was concerned, if we move to page 3 in our presentation, You will see KPIs are all growing. Net rental income on a like-for-like basis is up 2.4%. EBITDA, core business EBITDA, is flat, but mainly due to the fact that we have better spread our costs over the different quarters. And in the past, they were spread across the six-month amount. and it's across quarters, so we're fully in line with Q1 2025. FFO, funds from operations, is growing sizably, up 14.7%, landing at 11.7 million, and a group net profit of 5.7 million versus a net profit of 1.6 million recorded in Q1 2025. Of course, we thought a lot about the guidance we provided, and in February, we thought about it, and in our press releases, we gave, when we presented full year results, 255 full year results, we discussed of at least 45 million, And we're talking about FFO. Over the last few weeks, we felt some volatility. There was some concern felt by the market, especially due to the situation in the Middle East. So we want to be conservative in the way we disclose our guidance. But as you can see from page three, figures, somehow results, are reassuring and encouraging. make us confident that we can improve our results. If we move to page four now, let me remind you that yesterday we paid out a dividend of 15 euro cents per share, up 50% versus 2024. And therefore, we are back to having a growing dividend distribution. And I'm very, very pleased that To show you slide five in the presentation, because I was really concerned looking at the good results we had in January and February and March. I was concerned about seeing a decline in our figures because of the situation in the Middle East. Instead, we had an excellent operating performance. Tenant sales are up 4.7%, and that's really excellent. Outstanding, if we talk about grossly results, and footfalls are up 5.1%. And if we compare them to the national benchmark for CNCC, it's practically twice as much. The National Shopping Center averages up 2.5% and IGV footfalls are up 5.1%. Another very important piece of data is our hypermarkets and supermarkets. The ones we own are up 2.4%. And there again, there was concern because of the current situation and uncertainty that would impact March. As a matter of fact, instead, we performed well despite all the tension. On page six, I am back to showing you the idea I mentioned before. As you can see, it's a long pathway. It's like taking a hike in the mountains, a walk in the mountains. It's slow but constantly growing. So, in 2024, there were a lot of basis points of growth, but the growth here is slower. But the occupancy rate is still growing and it's a reassuring growth profile. And of course, there's a lot of work from the leading perspective because we want to both grow occupancy and at the same time, pick the right occupiers or tenants for our shopping centers. And we really made a start on our WALB that had been standing still for many quarters. Today, now we have 2.11 years WALB for Italian malls, because as I said many times, In addition to renegotiating new contracts with longer break options, we have the past legacy that is hovering because there were expiring contracts, so that is also being tackled. And last but not least, let me say, our upside for Italy is 1.3% on renewals or new contracts. And that turnover for the period accounts for 2.5% of Freehold Mall's total rent. In the past, it was 10.8%. And this quarter reconfirmed quantities and also quality of our upside in Italy. We invested a lot, and I'm moving to page 7 in the presentation, by the way. We invested a lot on anchor tenants. You know that larger food chains are very much supported by lots of funds who access their capital, and there's a pressure to really achieve growth. Many Eastern European rounds, Pepco is one, but there are many of Diem, for instance, IKEA, They want to come up with a big store, so they focus – well, they don't have their own big stores. They focus on shopping malls to provide customer service or pick up for online purchases. And we also work a lot on entertainment. I'm sure I've mentioned that before or I've discussed it with some of you. Entertainment in shopping malls, it's not just cinemas, movie theaters, but if you want – New ideas are more than welcome. This is the Ferrara one, and we've had excellent results in the Livorno shopping mall. And, of course, it's taking up space on the one hand. They also extend the time for visitors in shopping centers. And so that is also somehow important. helped by restaurants. And then entertainment, however, is very, very interesting. Let's move to page 8 in our presentation. And I'm saying retail is back. And I'm saying that again. In 2025, retail was the first asset class volume-wise, I mean investment volume-wise. And this is reconfirmed also in Q1 2026. In Q1 2026, We see that these $0.7 billion cut across the board. So there's outlets, factory outlets, high street, retail parks, you name it. So it has different levels of performance, but the Italian real estate performance and transaction market did really well. And retail is back in the focus of many investors. Let's move to page nine. And here again, the main financial indicators are improving. And LTV went down 20 basis points. We landed at 43.3% long term value. And weighted average interest rate, we'd already mentioned that. after the February deal, February transaction is 4.8%. When I was first appointed, if you remember, it was 6.1%. Now we are at 4.8%. So I think we really did a good job. And ICR is also increasing, going from 2 to 2.3 times. So we are starting to be in line with the main ratios. Let's look at the main figure on page 10, we're talking about net rental income from freehold. What I'd like to underline, and we've talked about it extensively with all colleagues, as you can see on the slide, net rental income from freehold on a like-for-like basis is growing both in Italy and Romania, is somehow offsetting the change in scope of consolidation. We lost 0.3 million in the first quarter due to the change in consolidation scope because of the disposals in Romania, but that was more than offset, so twice as much with the like-for-like change in growth both in Italy and Romania. And that takes us to a net rental income from Freehold landing at 25.2 million with a 2.4% growth on a like-for-like basis. EBITDA wise, here again we have a delta in the scope of consolidation and A number of costs were spread differently across quarters. It's constant, but it's like a growth somehow because we've disposed of assets. And despite those disposals, we managed to retain core business EBITDA in line with expectations. And then the good news that we also shared in the last quarters is the financial situation. part and here we are on page 12 and here you see that the financial position in a quarter is already benefiting 1.6 million thanks to debt reduction and the reduction in the weighted average interest rate. So most of the results achieved most of the performance generated in this quarter is generated by finance. The core business like-for-like situation is then offsetting the revenues that we're missing out on because of the disposals. And therefore, our financial position is still perfectly balanced. So FSO, despite the change in consolidation scope on page 14, sorry, 13, 1-3, The change in consolidation stop is 0.2, but the different number of items play a role so that we land at 11.7 million in the first quarter. It's a delta of 1.5 million and still up 14.7%. Hence, the group net profit, look at page 14 now. Well, the final assessment made in end of June and end of December, so capex investments, we have two restylings underway, Imola and Cesena, they're all expensed. And all these items account for minus .07, which is much lower than the benefit we get from the financial management. versus Q1 2025. And the group net profit is 5.7 million versus 1.6 million in Q1 2025. We are on page 15 now, our net financial position. Most important piece of information here, remember that our target is to get 4%, 40% LCV. We are... still on our pathway to reduce it. From 43.5 down to 43.3, the weighted average interest rate also went down. ICR went up, and the net debt on EBITDA is flat. It's still the same. For all of you, let me remind you about Groups Maturity Profile going forward. I'm looking at page 16 right now. And we are in a very comfortable position. The first maturities are in 2030. And indeed, we are always very careful. We're very focused on whatever is happening around us to grasp any opportunities that may come up, both to reduce interest rates, cost of debt, and also to revise our maturity profile. But right now, We are definitely confident because maturities are further ahead in time. And the average maturity is 5.3 years. On page 17, we see the balance we've managed to strike between market and banking system. And we're talking about debt breakdown, of course. The agency is in early November 2025. It was all banking debt almost and with mortgages. And with the issuance of $300 million, we've rebalanced today. Market is 38% roughly. And more than anything, we've freed up $680 million worth of assets, unencumbered assets. And therefore, secured and unsecured ratio is 40-60%. 40 unsecured, 60 secured. So we are in a financial position that is reliable, reassuring for both maturities and that breakdown between market and banking system and the right balance between encumbered or unencumbered assets. All of these transactions, we're on page 18 now, Today, being ESG compliant and having buildings, real estate, and policies that are sustainable over time is indeed a plus. And the banking system today acknowledges or recognizes this, and they see this as a window that can only be open provided some requirements are met, and we do meet those requirements. We had a nice small transaction, but a very appealing one indeed because an innovative transaction. On May the 16th, 10 million with Intesa San Paolo. It's a green credit line facility, and we are now among the first groups to have the sustainability report certification and green financing framework that proves that we, of course, want to be ESG compliant. We have a number of, well, in our agenda, there are a number of dates. We have corporate and investor relations agendas. We recently went to London and a lot of interest was brought shown towards our company. Also, thanks to the growth we have achieved starting from 2024 and the possibility to further grow going forward. We've tried to reconfirm all of these trends for 2026 as well because we've talked about this outside of Italy and we've seen that there's a lot of interest outside of Italy too because IGD is considered to be an attractive player, an attractive company. All that and also our corporate agenda on August 4th will have the six monthly results and on November 12th we'll have the results for the first nine months of 2026. Having said that, you have all the annexes that you can read on your own. but I think it's much more interesting to take your questions now. Thank you very much. This is the course collaborator. We are now starting the Q&A session. If you want to ask a question, please press star and 1 on your phone keypad. To be removed from the Q&A queue, press star and 2 on your phone keypad. Please press use your phone handsets to ask questions if you want to ask a question please press star and one on your phone now first question comes from the line of Simonetta Chiriotti with Mediobanca please go ahead madam good afternoon I have a couple of questions but first is about the cost of debt. You did a lot of work. You've met the main maturities. You've worked on maturity profile and costs. Could you elaborate on whether or not we've come to the ideal situation concerning those items. And then the negative items as impairments and fair value adjustments in your P&L. In this quarter, you don't have the official assessments and valuations, but could you at least give us some guidance in that respect? Thank you very much, Simonetta. Let me start on the first question. We did a lot of work, indeed, and this morning, still, while we were talking to the board of directors, we want to see opportunities. Today, The situation is somehow different from that of the past. Spreads are a bit more appealing, quote-unquote, whilst base rates, Euribor, just to be clear, are growing. We were around 2.3%. 1.2.2, now it's 2.8, 2.9. Generally speaking, our concern is that it's going to grow further. So far, we have only fixed rates until August. The installments from the bank loans, because the bond is fixed rate 4.45, the installment will be worked out in August for the second part. But, first of all, between now and 2031, we still have a bank loan, so-called Helmet 2, which was granted by a pool of 10 banks, if you remember, which is expensive, 3.2, that's the spread, and there we can work on maybe having another bank loan or bank financing. And we can have an early repayment of that and then reduce the cost of debt. And the second one, it could be a possible issuance. And there too, right now, the figure that we could aim for is not very different from our current cost of debt. So I would like to wait and see for a few more weeks to see if things are calming down because there are quite a few issuances, even recent ones were made, also in the real estate industry. But today, May the 7th, is probably not the best time to think of an issuance. But the answer I'd like to give you is that we're not standing still until from here to 2030. we have two opportunities to further reduce the cost of debt, either with new agencies or with a new bank loan, bank facility. And also, as to maturity profile, I wouldn't mind engaging in transactions, $100 million, $150 million worth, and reduce even the maturities in the year. The first one, 300 million in less than 800, which is our NFP. If we were to reduce 150 instead of 200, that'd be better. It was just to tell you that we are being very careful. We're very focused on what we do. We're both talking to banks and to the market, capital markets, of course. As to our income statement or P&L, we have two items, and one is a structural item that's about to come to an end, and it's IFRS 16, which is only affecting a master leave on Centro Nova, Bologna, because Fonte del Corallo has come to an end. So going forward, it would be February 2027. That's the end of it. And then the part, the item that would affect the P&L will no longer be in existence in February 2027. In the first quarter, we had a lot of capex, both in Italy and in Romania, on both the assets to be disposed of and the bigger asset I mentioned before, the big asset I mentioned at the beginning. And the rule we're giving ourselves is that until we have an expert report, until we have an assessment, we try and impair. If we, I'm talking about the external restarting of eMOLA. where we have a new facade, we changed the logo and everything, so I expect that market conditions being the same, there should be a write-up, and that would enable me on June the 30th, at the end of June, to offset a technical impairment, a technical write-down. So the rule we have is, whatever is capex, we get invoices, we expense invoices, and then we compare them, initial value plus CAPEX, and we give them for the expert report for the assessment. We are looking at the bottom line, of course, and it's an improvement going from 1.6 million to 5.7 million. And that's why we have these impairments and write-downs. Thank you. Next question comes from the lineup. Steven Bowman, ABN AMRO. Please, sir, go ahead. Hi.

Good afternoon. Thank you for taking my questions. Maybe question on the operating metrics, so food falls up, good metrics there, but given the rise in energy price, I can imagine that since the Iran conflict, food fall, for example, have come down. Could you provide some comments on food fall or consumer behavior in general, let's say from the past month?

That's my first question. He thought you were asking the same question at the same time.