ROADSHOW PRESENTATION
DISCLAIMER This presentation contains forward-looking information and statements about IGD SIIQ SPA and its Group. Forward-looking statements are statements that are not historical facts. These statements include financial projections and estimates and their underlying assumptions, statements regarding plans, objectives and expectations with respect to future operations, products and services, and statements regarding plans, performance. Although the management of IGD SIIQ SPA believes that the expectations reflected in such forward-looking statements are reasonable, investors and holders of IGD SIIQ are cautioned that forward-looking information and statements are subject to various risks and uncertainties, many of which are difficult to predict and generally beyond the control of IGD SIIQ; that could cause actual results and developments to differ materially from those expressed in, or implied or projected by, the forward-looking statements. These risks and uncertainties include, but are not limited to, those contained in this presentation. Except as required by applicable law, IGS SIIQ does not undertake any obligation to update any forward-looking information or statements
3 IGD Group 100% 0,1% 100% Immobiliare WinMagazine Millennium Larice Gallery 15% 99.9% 60%(*) Iniziative WinMagazine Bologna Nord 100% WinManagement (*) Porta Medicea is 80% consolidated on the back of the Put&Call option on the 20% minority stake.
Governance and Shareholders 4 Board of Directors was IGD BOARD OF DIRECTORS: renewed by the AGM on Lead Related-parties 23 April, 2009 Audit Nomination Compensantion Non-executive Executive Indipendent Independent Transaction Committe Committee Committee Director Committeee Board Composition : 15 Gilberto Coffari x members, the majority - 8 Sergio Costalli x out of 15 - independent Albertini Claudio x Roberto Zamboni x Most Committee members Leonardo Caporioni x x are independent Fernando Pellegrini x Corrado Pirazzini x Aristide Canosani x x Presence of a Lead Fabio Carpanelli x x Independent Director Massino Franzoni x x Francesco Gentili x x Accurate annual Board Andra Parenti x x x Review with a primary RiccardoSabadini x x x x Advisor Giorgio Boldreghini x x x Sergio Santi x x On 26 August, 2010 a new Related Parties Transactions Committee COOP ADRIATICA was appointed UNICOOP TIRRENO Committe Composition : 3 members, all of them TREASURY SHARES MAIN SHAREHOLDERS 30.37% being independent director s EUROPEAN INVESTORS INC. 41.50% A detailed procedure for AXA INVESTMENT MANAGERS transactions with related S.A. parties approved by the 11 2.02% F&C MANAGEMENT LTD Nov. 2010 BoD, becoming 2.01% 4.90% effective on 1 January 2011 2.01% SCHRODER INVESTMENT 3.55% 13.64% MANAGEMENT LTD FREE FLOAT
5 1H 2011 Results In a still unsteady economic context, IGD achieved very healthy results in1H2011: PROFITABILITY Positive performance: • Ebitda core business: € 43.6 mn • Ebitda margin (core business): 72.7%, an increase of 1.5 percentage points compared to 1H2010 • Net profit: € 30.2 mn, an increase of 115.2% compared to 1H2010 Net Profit ( € 14.0 mn) CASH FLOW • Continuosly growing FFO: € 22.8mn (+3.7%) • 15 March - purchase of a business division dedicated to the management INVESTMENTS of retail activities in Gran Rondò Shopping Mall, Crema ( € 4.9 mn + taxes and accessory charges ) • 17 April - first purchase included in the strategy of “City Center Project”: Bologna via Rizzoli ( € 25 mn + taxes and accessory charges ) • 29 April – completion of purchase of the headquarter in Bologna (2 nd /3 rd floors) ( € 6.1 mn + taxes and accessory charges ) • 27 June - purchase of a business division related to cinema and bar at Centro Sarca, Milan ( € 3.5 mn + taxes and accessory charges ) • 30 June – first purchase included in the strategy of “Assets Turn over”: Hypermarket in the Shopping Centre Conè, Conegliano ( € 23.5 mn + taxes and accessory charges ) • Net Debt increased as a result of new investments: 1,073 € mn FINANCIAL STRUCTURE • Increase in Shareholders‟ equity from 773.4 € mn to 785.6 € mn • Cost of debt amongst the lowest in the sector: 3.87%
6 Highlights REVENUES € 61.7 mn • Total revenues (+ 9.9 % vs 1H 2010) (management accounting) € 60 mn • Revenues from core business (+ 6.8 % vs 1H 2010) EBITDA € 43.6 mn • EBITDA (core business) (+ 9.1 % vs 1H 2010) 72.7% • EBITDA margin (core business) + 1.5 perc. points vs 1H 2010 € 30.2 mn GROUP NET PROFIT (+ 115.2 vs 1H 2010) € 22.8 mn Funds From Operations (FFO) (+ 3.7 % vs 1H 2010) Portfolio Mkt Value 1,893.7 € mn (at 30 June 2011) NNAV per share 2.62 €
ECONOMIC CONTEXT
8 The Italian economic environment (1/2) CONSUMPTIONS UNEMPLOYMENT GDP CPI 5 GDP TREND (CHANGE IN % ) INFLATION ( % CHANGE ) 4 0,4 0,4 0,5 0,3 0,3 0,0 0,1 0,1 2.7 -0,3 0,5 3 2.6 2.6 -0,7 2.5 -1,1 2.1 1.9 -2,0 1.7 1.7 1.7 2.4 2 1.6 1.6 -3,0 1.3 1 0 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 Jun-10 Aug-10 Oct-10 Dec-10 Feb-11 Apr-11 Jun-11 The unemployment rate Total sales: - 0.3%, of which: Inflation in June rose by 0.1% In 2Q2011 GDP increased by amounted to 8.0%, with an large retailers : -0.3% (m/m) reaching 2.7% at end of 0.3% compared to 1Q2011 improvement of 0.3% on an small stores: -0.3% period (y/y). The most (total for 6 months + 0.7%) and annual basis. (Jan-May 11/Jan-May 10) significant increases relate to it is expected to increase by food and energy products. 0.8% for 2011. Outlook The macroeconomic outlook remains uncertain, although there is a slight recovery in GDP, in line with expectations for all of 2011 (+0.8%), although in 1H2011 the weakness in domestic consumption was confirmed; some small signs of improvement came from the reduction in the unemployment rate. IGD had a positive effect on rents due to indexation; the general outlook on consumption is expected to be still unstable. Source: ISTAT and Confcommercio
The Italian economic environment (2/2) 9 Retail investments by type of Evolution of investments Evolution of yields by in retail sector in Italy investors in Italy (FY2010) sector in Italy Evolution of investments in retail in Italy ( € billion) 2,5 1 14 2 Property company 7 Private 1,5 46 Institution 1 Unlisted REIT Third party managed fund 0,5 28 Unknown 0 4 2002 2003 2004 2005 2006 2007 2008 2009 2010 1Q2011 Different types of institutions In 1Q 2011 a positive trend was Gross yields in the shopping center invested in the retail sector in 2010. recorded, compared to the same sector in 1Q 2011 were stable, New elements were JV and period of 2010. In fact, there was an standing at 6.15%. partnerships between retail increase in investments of about 100 specialists and financial investors. mn Source: JLLS and CBRE Outlook I nvestors‟ interest for the Italian market remains constant, but the investors continue to be extremely selective focusing on major projects and consolidated assets. Italian financial investors are not yet very active, unlike the foreign ones. The development pipeline continues to remain in standby, whereas the demand for new spaces has grown steadily both by international and Italian retailers. In this context IGD confirms its strategy focusing on existing assets through redevelopment and expansion, and on the purchase of buildings already constructed and producing income, also in city centers.
Performance of our Shopping Centers 10 ITALY Although the general context TENANT SALES AND FOOTFALLS IN OUR SHOPPING remained unstable, LFL trends for MALLS malls remained stable both for footfalls and sales, thanks to the SALES FOOTFALLS attention given to our tenants Total trend LFL Total trend LFL abs. value ROMANIA Footfalls increased by 1%. ITALY + 14.2% + 12.7% 32.4 mn flat - 0.3% Sales (for tenants that have cash register) were stable compared to ROMANIA 15.8 mn nr* nr* + 1.0% + 1.0% the previous year with a small * Not all our tenants have a cash register decrease in electronics HYPERMARKETS/SUPER MARKETS SALES IN ITALY (1H2011) Both Coop and the Market showed a negative trend for hypermarkets (especially for Total trend LFL Total trend LFL non-food products), although in this scenario Coop Adriatica Supermarkets + + 2.7% + 1.2% - 0.9% - 0.5% reported results above average hypermakets for hypermarkets and + 2.8% - 0.2% - 2.5% - 1.7% hypermarkets supermarkets + 2.6% + 2.4% + 0.5% + 0.5% Supermarkets Source: COOP elaboration on IRI Infoscan
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