In a particularly challenging environment, Mercialys once again showed the resilience of its business model and is reporting results that are in line with its full-year objectives.
Household consumption remained positive during the first half of the year (+0.2%) despite the gradual phasing out of the government measures to support purchasing power and a certain number of adverse events which weighed on retail trends in France (demonstrations against the proposed pension reforms, temporary blockade of certain fuel depots, inflation peak, particularly for food products, riots, deferral of the summer sales period).
Retailer sales for the first half of the year came to +3.5% compared with the first half of 2022. Shopping center footfall is up +2.3% from end-June 2022. These optimized trips by consumers are reflected in a regular increase in the average basket (+5.8% per year on average between 2018 and 2022).
The average occupancy cost ratio for tenant retailers was 10.9% for the first half of 2023, down slightly from the end of 2022 (11.1%) factoring in the change in the retail mix. This level illustrates the sustainability of rents for retailers and the attractive positioning of Mercialys’ sites despite an indexation effect of +3.8% and a rental reversion rate of +1.1%.
The increase in the current financial vacancyrate remained effectively under control, up from 2.9% at end-2022 to 3.3% at end-June 2023, linked primarily to the retailer Camaïeu going into liquidation. To date, nearly 60% of the rents corresponding to this brand have been relet. Excluding the impact linked to Camaïeu, the current financial vacancy rate would be virtually stable for the first half of the year.
Invoiced rents are up +2.1%, with +4.2% like-for-like.
Recurrent earnings (FFO) at end-June 2023 are stable compared with the first half of 2022 at Euro 57.5 million. The basis for comparison at June 30, 2022 incorporated various elements relating to the health crisis representing Euro +5.7 million of net income. FFO at end-June 2023 includes a non-significant amount of net income in relation to this for Euro +0.4 million. On a basis restated for the non-recurring impacts linked to the health crisis, with these impacts to fade in 2023, FFO at end-June 2023 shows an increase of +10.3%.
The increase in appraisal yield rates to 6.21% (vs. 5.75% at end-December 2022) resulted in a contraction in the portfolio value to Euro 2,987 billion including transfer taxes, down -3.4% like-for-like versus December 31, 2022. The average appraisal yield rate shows a significant spread of nearly 330bp above the risk-free rate (10-year OAT) at end-June.
The LTV ratio came to 36.1%, reflecting a solid balance sheet structure and enabling the Company to capitalize on opportunities for growth.
2023 objectives: Following the solid performance levels achieved over the first half of the year, Mercialys is able to confirm its objectives for recurrent earnings (FFO) per share growth of at least +2.0% versus 2022 and a dividend ranging from 85% to 95% of 2023 FFO.