SOURCE: Société de la Tour Eiffel

March 05, 2009 02:37 ET

Société de la Tour Eiffel : 2008 annual results : Solid rental income flow and financial parameters under control

PARIS--(Marketwire - March 5, 2009) -


SOCIETE DE LA TOUR EIFFEL

2008 ANNUAL RESULTS

Solid rental income flow and financial parameters under control

Key figures

Consolidated

+-------------------------+--+---------+---------+
|In MEUR                  |  |   2008  |   2007  |
+-------------------------+--+---------+---------+
|Rents                    |  |     70.6|     72.4|
+-------------------------+--+---------+---------+
|Net operating income     |  |     50.6|     52.7|
+-------------------------+--+---------+---------+
|Net result               |  |   - 16.7|     91.6|
+-------------------------+--+---------+---------+
|Portfolio value net of   |  |  1 104.3|  1 082.8|
|transfer costs           |  |         |         |
+-------------------------+--+---------+---------+
|In EUR  / share*         |  |         |         |
+-------------------------+--+---------+---------+
|Net cash flow            |  |      3.6|      4.5|
+-------------------------+--+---------+---------+
|NAV net of transfer costs|  |     88.5|    101.9|
+-------------------------+--+---------+---------+
|Corporate                |  |         |         |
+-------------------------+--+---------+---------+
|Net profit (MEUR )       |  |     28.2|     31.6|
+-------------------------+--+---------+---------+
|Dividend** (EUR /share)  |  |        5|        6|
+-------------------------+--+---------+---------+

* number of shares as at 31st December 2008 and 2007: 5 193 003

** subject to Annual General Meeting deliberation

Sustained operational activity in 2008

Against a deteriorating economic background, Société de la Tour Eiffel concluded more than 100 000 m(2) of lettings (total portfolio 713 000 m(2)), including 76 000 m(2) of lease renewals (12.5 MEUR of annual rent) with major tenants, mostly for a nine year fixed term. As a result some 2/3rds of global rental income stems from 20 quality tenants for an average term expiring 2015. The remainder of the rental income flows from some 400 leases offering a wide geographical spread and at reasonable, competitive rental levels.

A rejuvenated portfolio and limited downward NAV adjustment

Following 50 000 m(2) of development completions in 2008, the company's property portfolio stood at 1 104MEUR in the year end consolidated accounts compared to 1 083MEUR end 2007. Some 62% of the company's portfolio now comprises new or renovated properties.

The overall value increase results from:

- a substantial net gain through acquisitions and development completions which amounted to twice the value of disposals (92MEUR ),

- a limited reduction in the value of the core portfolio:

o rental indexation partially offsetting yield expansion,

o relative resistance of regional properties to upward yield adjustment,

- active asset management of key properties.

The Net Asset Value, net of transfer costs, amounts to 88.5EUR per share as at 31st December 2008, compared to 101.9EUR end 2007, 3.8EUR of the reduction being due to value adjustment on hedging.

Financial resources and debt maturity under control

The company renegotiated a substantial part of its financing facilities in 2008 notably extending the maturity of 2/3rds of its debt from 2010 to 2013. Consequently 80% of the company's bank finance is now secured beyond 30th June 2013.

The company remains within its banking covenants as at 31st December 2008, both globally and separately in terms of LTV and ICR.

Dividend

Further to the interim dividend of 3.50EUR per share paid in August 2008, the Board will propose to the Annual General Meeting on 14th May a final dividend of 1.5EUR making 5EUR for the year 2008.

Mark INCH, Chairman, declares: " Société de la Tour Eiffel's current share price of around 19 EUR appears totally decorellated from the current NAV and dividend yield ".

Outlook

In the wake of the accomplishments of 2008, the company expects to complete during 2009/10 another 50 000 m(2) of new developments (all financed and in majority prelet) and continue to secure its rental income flow. Selective disposals will be reviewed in the light of investment market conditions.

The redevelopment potential at Massy and in the business parks will be pursued only if market circumstances permit, be it in terms of return on investment, pre letting, pre sales or other acceptable financing arrangements.

Performance indicators, occupancy rates, debt ratios and maturities will continue to be carefully monitored.

FURTHER DATES:

- 14th May 2009 : General Meeting, Automobile Club de France, Place de la Concorde 75008 Paris

- 27 th May 2009 : Payment of final dividend 2008

About Société de la Tour Eiffel

A " SIIC " quoted on the Euronext Paris Exchange, the company pursues a strategy focused on the ownership and the development of quality office and business space capable of attracting a wide range of tenants in both established and emerging locations. The company's portfolio stands at 1.1 billion Euros of assets spread evenly between the Paris area and the regions.

Contact

Jérôme Descamps,

Deputy Managing Director (Finance)

in charge of Financial Information

Tel. : +33 (0) 1 53 43 07 06

Web site: www.societetoureiffel.com

Press Contact

Jean-Philippe Mocci, Capmot

Tel. : + 33 (0) 1 71 16 19 13 / + 33 (0) 6 71 91 18 83

jpmocci@capmot.com

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