Message from the CEO

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OdisseasAthanassiou

Message from the CEO

Dear Shareholders,

 

Year 2018 was the fifth consecutive year of historic record growth in our operating performance as we increased consolidated EBITDA before valuations by 16.9% to €48.4 mil., reaffirming LAMDA Development’s continuing leadership position in the retail real estate sector. This significant growth rate is primarily attributed to the acquisition from HSBC of the remaining 50% share capital of Lamda Olympia Village S.A., the company owner of The Mall Athens, in July 2017. Without the said acquisition, growth would had been 2, 1% on a like for like basis.

 

A milestone positive development for the Company in 2018 was the agreement in August with the Ecumenical Patriarchate, owner of the land plot on which the Mediterranean Cosmos Shopping Centre is developed and operates, for the extension of the long-term lease of the said land plot area for 30 additional years, until year 2065. Following the new concession agreement, the shopping center’s property value significantly increased by €28.7 million.

Also in August 2018 - after a severely delayed procedure for the issuance of the building permit – construction works commenced for the development of the Western Part of the former International Broadcasting Center Building, where Golden Hall operates. The investment, of a total budget of €25 million, is intended to supplement significantly the family entertainment orientation of the shopping center, while creating additional employment opportunities estimated at more than 500 new positions.

Performance in 2018

The average occupancy of our shopping centers approaches 100% with commercial interest for retail spaces remaining vibrant.

At consolidated level, financial results in 2018 showed a very impressive Net Profit of €42.3 mil, compared to losses of €48.3 million in 2017. Significant driver for this increase has been the net gain from the fair value adjustments of investment property assets which reached €56.8 million compared to €11.7 mil in 2017.

 As per contractual obligation, the return of the ownership of the office building “ILIDA BUSINESS CENTER” to the subsidiary company Lamda Olympia Village SA was concluded in October 2018. The office building fair value on 31/12/2018 balance sheet stood at €29.3 million. A provision regarding the financial impact of the above transaction had been already provided for in the 2017 Financial Statements.

Furthermore, taxes in 2018 include a one-off positive deferred tax adjustment of €14million due to a 4% tax rate deduction.  Income tax amounts to €10.4 million, while deferred tax amounts to €18.3 million.

 

As a result, total NAV reached €438.9 mil. (€5.64 per share), versus €395.1 mil. in the previous year while the group cash position reached €68.5 mil.

Consolidated total debt as at 31/12/2018 stands at €483.2 mil. at an average interest rate cost of 4.09% and net loan to value ratio of 44%, reflecting a sound capital structure.

 

The Hellinikon Project Update

With regard to the landmark Hellinikon project, all the remaining necessary actions for the fulfillment of the contractual conditions precedent for the acquisition of the shares of Hellinikon S.A. and for the construction works to commence, remain within the responsibility and the discretion of the relevant state ministries and institutions. We remain optimistic and believe that, to the extent feasible, the fulfillment of these actions shall be achieved the soonest possible.

The development of the Hellinikon will be the largest urban development in Europe, with a total budget of €8 bil. and is expected to have an unprecedented positive impact on employment and tourism in Athens, while generating a highly positive environmental impact given the 2 million sq. m. of Metropolitan Park to be constructed. 

Going Forward

 

Our company has a very rich track record of investments in the domestic market, even during the period of the economic crisis and uncertainty with various projects such as: the acquisition of the remaining 40% ownership of Mediterranean Cosmos in 2010 for an amount of €80mil, the acquisition in 2013 of the usufruct right of the IBC building (Golden Hall) for €81 mil., the successful Share Capital Increase €150 mil. in July 2014, the winning bid for the development of the Hellinikon signed in November 2014 and the acquisition in July 2017 of the remaining 50% of The Mall Athens of an amount of €85 mil., the €25mil ongoing development of the western part of the IBC building (Golden Hall), the 30 year extension of the concession for the Mediterranean Cosmos shopping center and,of course, all  our commitment in management resources and related expenditures  in doing whatever is necessary in the last five years to overcome all the hurdles in order to finally realize the successful commencement of the landmark project of Hellinikon. 

 

Finally, I would like also point out that, our share price has grown more than 30% in the current year to date, a fact that makes us feel confident that the stock market continues to take a positive view  towards our overall strategy.

Dear Shareholders,

 

Despite the well-known difficulties on our domestic economic environment, we have proven our resilience and persistence in taking up the challenges, opportunities and risks always with a positive view towards future.

 

We remain confident that, based on our long built know-how, dominant position in the retail real estate sector in Greece and our strong international partnerships, that we shall continue adding value and growth to our shareholders.

 

Our major shareholder, Latsis Group, continuous to provide its overwhelming support and, together with all shareholders support, we are confident that we shall continue to succeed attaining our common goals.

 

Once again, I take this opportunity to thank our employees for their hard work, exceptional performance, commitment and enthusiastic support in sharing this common vision.

 

On behalf of the management and the employees, I want to thank you for the trust you have placed in us.

                                                                                                            

  Odisseas Athanasiou,

Chief Executive Officer

Message from the CEO

 

 

Dear Shareholders,

 

Year 2018 was the fifth consecutive year of historic record growth in our operating performance as we increased consolidated EBITDA before valuations by 16.9% to €48.4 mil., reaffirming LAMDA Development’s continuing leadership position in the retail real estate sector. This significant growth rate is primarily attributed to the acquisition from HSBC of the remaining 50% share capital of Lamda Olympia Village S.A., the company owner of The Mall Athens, in July 2017. Without the said acquisition, growth would had been 2, 1% on a like for like basis.

 

A milestone positive development for the Company in 2018 was the agreement in August with the Ecumenical Patriarchate, owner of the land plot on which the Mediterranean Cosmos Shopping Centre is developed and operates, for the extension of the long-term lease of the said land plot area for 30 additional years, until year 2065. Following the new concession agreement, the shopping center’s property value significantly increased by €28.7 million.

 

Also in August 2018 - after a severely delayed procedure for the issuance of the building permit – construction works commenced for the development of the Western Part of the former International Broadcasting Center Building, where Golden Hall operates. The investment, of a total budget of €25 million, is intended to supplement significantly the family entertainment orientation of the shopping center, while creating additional employment opportunities estimated at more than 500 new positions.

 

Performance in 2018

The average occupancy of our shopping centers approaches 100% with commercial interest for retail spaces remaining vibrant.

At consolidated level, financial results in 2018 showed a very impressive Net Profit of €42.3 mil, compared to losses of €48.3 million in 2017. Significant driver for this increase has been the net gain from the fair value adjustments of investment property assets which reached €56.8 million compared to €11.7 mil in 2017.

As per contractual obligation, the return of the ownership of the office building “ILIDA BUSINESS CENTER” to the subsidiary company Lamda Olympia Village SA was concluded in October 2018. The office building fair value on 31/12/2018 balance sheet stood at €29.3 million. A provision regarding the financial impact of the above transaction had been already provided for in the 2017 Financial Statements.

Furthermore, taxes in 2018 include a one-off positive deferred tax adjustment of €14million due to a 4% tax rate deduction.  Income tax amounts to €10.4 million, while deferred tax amounts to €18.3 million.

 

As a result, total NAV reached €438.9 mil. (€5.64 per share), versus €395.1 mil. in the previous year while the group cash position reached €68.5 mil.

Consolidated total debt as at 31/12/2018 stands at €483.2 mil. at an average interest rate cost of 4.09% and net loan to value ratio of 44%, reflecting a sound capital structure.

The Hellinikon Project Update

With regard to the landmark Hellinikon project, all the remaining necessary actions for the fulfillment of the contractual conditions precedent for the acquisition of the shares of Hellinikon S.A. and for the construction works to commence, remain within the responsibility and the discretion of the relevant state ministries and institutions. We remain optimistic and believe that, to the extent feasible, the fulfillment of these actions shall be achieved the soonest possible.

The development of the Hellinikon will be the largest urban development in Europe, with a total budget of €8 bil. and is expected to have an unprecedented positive impact on employment and tourism in Athens, while generating a highly positive environmental impact given the 2 million sq. m. of Metropolitan Park to be constructed. 

 

Going Forward

 

Our company has a very rich track record of investments in the domestic market, even during the period of the economic crisis and uncertainty with various projects such as: the acquisition of the remaining 40% ownership of Mediterranean Cosmos in 2010 for an amount of €80mil, the acquisition in 2013 of the usufruct right of the IBC building (Golden Hall) for €81 mil., the successful Share Capital Increase €150 mil. in July 2014, the winning bid for the development of the Hellinikon signed in November 2014 and the acquisition in July 2017 of the remaining 50% of The Mall Athens of an amount of €85 mil., the €25mil ongoing development of the western part of the IBC building (Golden Hall), the 30 year extension of the concession for the Mediterranean Cosmos shopping center and,of course, all our commitment in management resources and related expenditures  in doing whatever is necessary in the last five years to overcome all the hurdles in order to finally realize the successful commencement of the landmark project of Hellinikon.

 

Finally, I would like also point out that, our share price has grown more than 30% in the current year to date, a fact that makes us feel confident that the stock market continues to take a positive view  towards our overall strategy.

 

Dear Shareholders,

 

Despite the well-known difficulties on our domestic economic environment, we have proven our resilience and persistence in taking up the challenges, opportunities and risks always with a positive view towards future.

We remain confident that, based on our long built know-how, dominant position in the retail real estate sector in Greece and our strong international partnerships, that we shall continue adding value and growth to our shareholders.

Our major shareholder, Latsis Group, continuous to provide its overwhelming support and, together with all shareholders support, we are confident that we shall continue to succeed attaining our common goals.

Once again, I take this opportunity to thank our employees for their hard work, exceptional performance, commitment and enthusiastic support in sharing this common vision.

On behalf of the management and the employees, I want to thank you for the trust you have placed in us.

                                                                                                              Odisseas Athanasiou,

Chief Executive Officer