SOURCE: BR MALLS Participacoes S.A.

November 05, 2009 09:25 ET

BRMALLS Announces Adjusted EBITDA of R$75.5 Million in 3Q09, Growth of 24.2% Over 3Q08, With an Adjusted EBITDA Margin of 80.2%

RIO DE JANEIRO, BRAZIL--(Marketwire - November 5, 2009) - BRMALLS Participações S.A. (BOVESPA: BRML3), the largest shopping mall company in Brazil, announces today its results for the third quarter of 2009 (3Q09). BRMALLS has a portfolio of 35 malls, comprising 1,025.0 thousand m2 of gross leasable area (GLA) and 458.6 thousand m2 of owned GLA. The Company currently has 5 greenfield projects under development and 7 expansion projects, which, together, will increase its total GLA to 1,250.7 thousand m2 and its owned GLA to 625.2 thousand m2 within the next few years. BRMALLS is the only shopping mall company in Brazil with a national presence targeting all income segments. The Company provides management and leasing services for 28 malls, in 26 of which it retains an interest, with total GLA of 869.3 thousand m2.

All the financial and operational information below is in Reais (R$), and comparisons refer to the third quarter of 2008 (3Q08), except where otherwise indicated. The complete financial statements in accordance with the accounting practices and norms required by the CVM (Brazilian Securities & Exchange Commission) are available at the end of this report.

3Q09 Highlights and Subsequent Events

--  Gross revenues totaled R$102.6 million in 3Q09, an increase of 15.8%
    over 3Q08; and R$290.0 million year-to-date, 21.3% over the first nine
    months of 2008.
--  Consolidated NOI totaled R$85.8 million in 3Q09, 15.3% higher than in
    3Q08, and R$243.9 million in 9M09, an increase of 87.8% year-over-year. The
    NOI margin also increased from 90.8% in 3Q08 to 91.4% in 3Q09, and from
    89.8% for 9M08 to 92.0% for 9M09. Also in 3Q09, same-property NOI increased
    12.5% over 3Q08, while in 9M09 same-property climbed 16.0% year-over-year.
--  Adjusted EBITDA stood at R$75.5 million in 3Q09, an increase of 24.2%
    over 3Q08 and the adjusted EBITDA margin improved substantially, widening
    from 73.6%, in 3Q08, to 80.2% in 3Q09. Year-to-date adjusted EBITDA totaled
    R$211.8 million, up 31.6% over 9M08, while the adjusted EBITDA margin
    increased from 72.7% to 79.7%.
--  We ended the quarter with net income of R$65.2 million, versus a net
    loss of R$22.6 million in 3Q08, and a 3Q09 net margin of 69.2%. Net income
    in the first nine months of 2009 totaled R$168.7 million, compared to a net
    loss of R$30.1 million for 9M08, accompanied by a margin of 63.4%. Earnings
    per share (EPS) stood at R$0.32 in 3Q09 and R$0.83 year-to-date.
--  FFO totaled R$79.1 million in 3Q09, an R$73.6 million increase over
    the same period last year, and R$211.2 million in 9M09. AFFO (Adjusted
    Funds from Operations) totaled R$58.8 million in 3Q09, an increase of 58.8%
    over 3Q08 and R$150.5 million in 9M09, an increase of 125.6% over 9M08.
    AFFO/share came to R$0.29 in the third quarter and R$0.74 in the first nine
--  Two new expansions were inaugurated in 3Q09 -- Shopping Goiânia and
    Norte Shopping -- totaling 8,500 m2 of GLA. By the end of 2009, we will
    also inaugurate the expansion of Ilha Plaza, which will add 2.4 thousand m2
    of GLA to the mall, 100% of which has already been leased.
--  After obtaining all the necessary licenses and having leased more
    than 60% of GLA, we began construction of the Granja Vianna and Sete Lagoas
    projects, with a total GLA of 46 thousand m2. Both projects have an
    expected real unleveraged IRR of more than 17%. The Company raised
    construction financing with Banco Santander S.A. in the amount of R$94.6
    million, over 12 years and at a cost equivalent to IGP-M + 8.30%, for the
    Granja Vianna development, reaching a real leveraged IRR of 22% p.a.
--  In November, we began the construction of Shopping Tamboré expansion,
    which will add 14,682 m2 of GLA, of which 79% is already leased and
    increasing the size of the mall by almost 50%. In October we entered into
    an agreement with Itaú-Unibanco S.A. to issue CRIs (Certificates of Real
    Estate Receivables) totaling R$92.5 million over 12 years with an
    equivalent cost of IGP-M + 7.75%.
--  The Company signed 366 leasing contracts in 3Q09, versus 352 in 2Q09,
    65 of which related to our greenfields and expansions projects. Renewal and
    new contract leasing spreads of our existing malls averaged 8.1% and 16.7%,
--  In July, we concluded one more follow-on share offering, with the
    issuance of 30.3 million common shares on the Bovespa, raising R$ 446
    million. The offering increased our free float to 64.4%. After the offering
    our shares have negotiated on average R$ 12.7 million per day compared to
    R$5.3 million prior to the offering.

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