SOURCE: Wereldhave NV

March 03, 2010 08:25 ET

Wereldhave NV - Annual Financial Report

THE HAGUE--(Marketwire - March 3, 2010) -

Results 2009

Key items

- Direct result per share stable at EUR 4.93 (2008: EUR 4.92)

- Property revaluation -9.1% (until Q3 2009: -8.3%)

- Net asset value EUR 73.77 per share (2008: EUR 83.74)

- Solvency stable at 70% (2008: 71%)

- Use of convertible by purchase of four Dutch shopping centres

- Optional dividend EUR 4.65 per share (2008: EUR 4.65)

Hans Pars (CEO Wereldhave N.V.) comments:"In these times of economic head wind, we have closed the year 2009
with an increase in the direct result of EUR 1.7 mln. In spite of the
increased number of shares due to the stock dividend that was paid out
in 2009, direct result per share rose by EUR 0.01. The increase of 
direct result can mainly be attributed to the fact that we chose to be
financed at variable interest rates. Lower interest charges have fully
compensated the decrease in occupancy. Good news is that we have
succeeded in diminishing vacancy in the office portfolio with lettings
in Washington D.C., Paris and Manchester, which demonstrates that that
even in a difficult market good quality office buildings can be
successfully let. That underpins the quality of our portfolio.

During the third quarter of 2009 we have successfully launched a EUR 230
mln convertible bond, increasing our immediately available funds to
approx. EUR 390 mln as at December 31, 2009. On February 15, 2010 we 
used the convertible for the purchase of stakes in five Dutch shopping
centres for EUR 249.5 mln including transaction costs in Purmerend,
Capelle a/d IJssel, Roosendaal, Eindhoven and Utrecht.

The net initial yield of this investment amounts to well over 6%. The
acquisition of the shopping centre in Utrecht has been cancelled since
a third party used a first right of refusal. The purchase price will be
lowered by EUR 29.7 mln including transaction costs. Completion is
scheduled for March 16, 2010. This transaction immediately contributes
to the profit per share for the year 2010.

We want to use attractive investment opportunities and mainly seek
expansion in the United Kingdom (shopping centres), France (offices in
Paris) and Spain (offices in Madrid). We will pay a lot of attention to
the improvement of the occupancy rate.

We propose to shareholders a dividend of EUR 4.65, equal to the dividend
in respect of the year 2008. Of the dividend, EUR 3.20 will be paid in
cash and EUR 1.45 in cash or in shares, at the option of the

Profit / loss

The profit for 2009 amounted to EUR -102.3 million or EUR -5.07 per
share (2008: EUR 8.8 million or EUR 0.02 per share). The profit
decrease was caused by a downward revaluation of the portfolio in all
countries. This can be attributed mainly to higher yields and lower
market rents. The revaluation totalled EUR - 245.8 million (2008: EUR -
112.6 million). Exchange rate differences had a positive effect on the
profit of EUR 6.0 million (2008:

EUR -1.6 mln). Negative property revaluations were clearly lower during
the fourth quarter, resulting in a profit for the quarter.

Direct result

The direct result over 2009 amounted to EUR 111.1 million and was EUR
1.7 mln higher than the figure for 2008. Rising vacancies, especially
in two office buildings in Washington D.C. and Paris, resulted in a
decrease in the net rental income of EUR 5.8 million. The increase
(including exchange rate differences) of the direct result was
therefore primarily caused by a decrease in interest charges of EUR 8.5
million. General costs increased by EUR 1.3 million, primarily due to
changes in the composition of the Board of Management and the costs of
consultants. Exchange rate differences ultimately had a minimal effect
on the direct result.

The decrease in interest expenses was a result of the sharply lower
interest rates, especially in the United States. Wereldhave benefited
significantly from the low interest in 2009 because a large part of its
loans are financed at variable interest rates. The average interest
rate declined sharply over the first nine months of the year, but the
5-year convertible bond loan of EUR 230 million issued on 16 September
at 4.375% caused the average interest at year-end to increase again to
3.3% (2008: 3.7%).

Indirect result

The indirect result for 2009 totalled EUR - 213.4 million (2008: EUR -
100.6 million).

The average yield on the portfolio applied in the valuation increased
by approx. 50 basis points in 2009, bringing the weighted net initial
yield on the portfolio to approximately 6.7% (2008: 6.2%). The increase
in the initial yields and lower market rents resulted in a downward
revaluation of the property portfolio as at 31 December 2009. The
revaluation on financial instruments amounted to

EUR -1.2 million (2008: EUR 4.7 mln).

A result on property disposals was achieved in 2009 of EUR 0.8 million
(2008: EUR 4.3 million). Lower property valuations and a release of
deferred taxes in the United Kingdom brought a decrease in deferred
taxes on the indirect result of EUR 34.8 million (2008: 10.0 million)
Interest expenses in the indirect result increased by EUR 0.4 million
to EUR 2.0 million, in particular due to the issue of a EUR 230 million
convertible bond in 2009. Other financial income and expenses improved
by EUR 6.1, as a result of one-off pension expenses in 2008 and of
exchange rate differences.


As at year-end, equity including minority interests before
appropriation of the proposed divided amounted to EUR 1,686.5 million.
This represents a 70% solvency (2008: 71%). The Loan to Value amounted
to 30% (2008: 27%). This places Wereldhave between the five best
capitalised European property investment funds. A total of 495,253 new
shares were issued in 2009 in connection with the distribution of an
optional dividend. The total number of ordinary shares in issue at
year-end 2009 amounted to 21,276,988.

The net asset value per share before profit appropriation as at
December 31, 2009 was EUR 73.77 (year-end 2008: EUR 83.74).

Property portfolio

The composition of the portfolio remained virtually unchanged in 2009.
In comparison with 2008, the occupancy level fell by 5 percentage
points to 89.7%. Occupancy levels per sector over 2009 were 81.3% for
offices, 97.8% for retail/leisure, 98.9% for logistics, and 88.1% in
the residential sector.

The vacancy level increased compared to 2008 (occupancy rate 94.7%)
when two office buildings (Paris and Washington D.C.) were vacated at
the end of 2008. Some 10,400 m2 in Paris, representing about half of
the vacancies in France, has been leased as from mid-February 2010. In
Washington D.C. some 4,700 m2 or about 55% of the space vacated in
December 2008 has been leased. The new rents exceed the old rent
levels. Significant progress has also been achieved in leasing space in
Manchester. Lease agreements were signed in December 2009 and January
2010 for 93% of the space available in this office building.

A downward revaluation at the year-end rates was made to the investment
portfolio of 9.1% (yield -7.7%, rents -1.4%). The value of the
development portfolio as at year-end was EUR 81.6; the value of the
investment portfolio amounted to EUR 2,418.2 million.

On February 15, 2010, Wereldhave purchased (stakes in) five Dutch
shopping centres for EUR 249.5 mln. Involved are the Eggert centre in
Purmerend, De Koperwiek in Capelle a/d IJssel, Woensel XL in Eindhoven,
de Roselaar in Roosendaal and Overvecht in Utrecht. The acquisition of
the shopping centre in Utrecht has been cancelled since a third party
used a first right of refusal. The purchase price will be lowered by EUR
29.7 mln including transaction costs. Completion is scheduled for March
16, 2010. This acquisition Marks a first important step in the
strategic goal to expand the share of shopping centres to 50-60% of the
portfolio. After completion, the share of shopping centres will amount
to circa 50%.

Development portfolio

In Belgium, a permit has been obtained for the 12,000 m2 expansion of
the Nivelles shopping centre. Construction of the expansion is expected
to commence in June 2010. The permit for a retail park was cancelled by
the Minister in appeal proceedings. In Tournai, also in Belgium, an
application has been submitted for permits for a 4,500 m2 expansion of
the shopping centre and a 10,000 m2 retail park. This permit is
expected to be granted in the fourth quarter of 2010.

In the United States, the first two office buildings in the Eilan
project in San Antonio are scheduled to be put into operation in the
second quarter of 2010. Construction of the rest of the first phase of
this project consisting of some 500 homes, a hotel and a variety of
commercial facilities commenced in 2009 and is scheduled for delivery
starting in 2011.

Dividend proposal

An optional dividend of EUR 4.65 will be proposed to the General
Meeting of Shareholders for 2009, of which EUR 3.20 in cash in order to
comply with the fiscal distribution obligation, after deducting
withholding tax, and EUR 1.45 in cash or in shares, at the option of
the shareholder. The latter distribution will be charged to the
reinvestment reserve and therefore no dividend tax will be due. With a
dividend of EUR 4.65, the payout ratio amounts to 94.3%. The dividend
is payable from 7 May 2010. Shareholders can make their choice between
cash and shares from April 19, 2010 until May 3, 2010, 17.00 hr CET. If
a shareholder does not communicate his choice, the dividend will be
paid in shares. The optional dividend component in shares (as a
percentage) will be set by dividing the optional dividend in cash by
the average of share prices at closure of trading of the period April
26 up to May 3, 2010, with a 3%-5% margin. The maximum number of
ordinary shares to be issued is this percentage, multiplied by the
number of shares in issue. The exact number of shares issued will be
communicated by press release on May 4, 2010, before trading hours. The
newly issued ordinary shares bear equal rights as those already in
issue and are entitled to dividend as from the financial year 2010 and


With its solid balance sheet, Wereldhave's financial position is
strong, despite the downward revaluation of the property portfolio in
2009. Wereldhave expects more property to be available for sale in
2010, certainly in those markets where Wereldhave would like to expand
its position: the United Kingdom, France and Spain. Its strong
financial position will enable Wereldhave to benefit. In doing so,
Wereldhave will continue to focus on high-quality property and prime
locations, as these provide a solid basis for a stable and growing
direct result per share. Once its acquisitions start to take shape,
Wereldhave will commence selling smaller projects involving less than
EUR 20 million, provided that can be obtained a suitable price.

Based on the quality of the shopping centres, Wereldhave expects the
occupancy rate in the shopping centre portfolio to remain high. An
upward trend can be seen in the occupancy rate for the offices
portfolio, thanks also to excellent lease results in 2009 in Paris,
Manchester and Washington D.C. in particular. This demonstrates that
even in a difficult market, good quality office buildings can be
successfully leased. Conditions on the office market will nevertheless
continue to be challenging, with strong competition and pressure on
prices in most markets. Top priority will continue to be devoted to
maintaining and preferably improving the occupancy level in 2010.

The results will be explained during a press conference, to be held
today at 11.00 h CET at the Wyndham Apollo hotel, Apollolaan 2, 1077 BA

At 14.00 h CET in the same room an analyst meeting will be held to
explain results in detail. This meeting can be followed by audio cast
on Questions can be put by e-mail via this webcast.

Click on, or paste the following link into your web browser, to view
the associated PDF document.

The Hague, March 3, 2010           Board of Management
Wereldhave N.V.

For further information:
Wereldhave N.V.
Richard W. Beentjes
Tel.  + 31 70 346 93 25

Information for analysts:
Wereldhave N.V.
Charles F. Bloema
Tel.  + 31 70 346 93 25

                    This information is provided by RNS
          The company news service from the London Stock Exchange


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