MEXICO CITY, MX / ACCESSWIRE / October 26, 2021 / GRUPO GICSA, S.A.B. de C.V. ("GICSA" or "the Company") (BMV:GICSA), a leading Mexican company specializing in the development, investment, commercialization and operation of shopping malls, corporate offices and mixed-use properties, announced today its results for the third quarter ("3Q21") and for the nine months ("9M21") ended September 30, 2021.
All figures have been prepared in accordance with International Financial Reporting Standards ("IFRS") and are stated in millions of Mexican pesos (Ps.).
GICSA's financial results presented in this report are unaudited and therefore may be subject to adjustments in the future.
Main Highlights
Corporate
- During the quarter, GICSA carried out a more thorough inventory of commercial spaces under lease, which allowed the Company to identify clients which, even though they are currently under lease contracts, discontinued their operations and are no longer meeting their payment obligations (abandoned commercial spaces). As such, this has impacted occupancy, invoicing, collections, and accounts receivable.
- In the 3Q21, the Company is disclosing the concept of adjusted occupancy rate, a calculation that excludes abandoned commercial spaces, which represents an adjustment of -4% to the quarter´s contractual occupancy rate and -12% compared to 2019. This adjustment reduced the occupancy rate from 87% to 82% in our stabilized portfolio, and from 82% to 78%, including properties under stabilization (Explanada Culiacan, Lomas Altas and Masaryk 169).
- The adjustment's impact on the annual invoicing was a decrease of 15% compared to pre-pandemic levels.
- Out of this invoicing, 84% of the collection was recovered during the quarter. The combined effect on the decreases in adjusted occupancy rate and percentage of collections have represented an annual impact on the Company´s cash flow of approximately Ps. 1.1 billion, a decrease of 23% compared to pre-pandemic levels.
- The recognition of the adjusted occupancy rate requires the Company to legally document the aforementioned abandonment of commercial spaces in order to stop the invoicing process. Accordingly, this is reflected as an increase in accounts receivable, which was Ps. 1.3 billion at the end of the 3Q21.
- Out this amount, the Company estimates to recover approximately Ps. 600 million, with the remaining Ps. 700 million to be written off in the subsequent quarters, as abandoned commercial spaces and agreements under the tenant Covid-19 support program are documented, negatively impacting revenues in the income statement.
- In order to compensate the negative effects caused by the pandemic, and given the upcoming maturities of corporate loans, the Company continue working closely with Lazard and its bondholders on an analysis of GICSA's debt structure and the monetization of non-productive assets, to reposition our Company for the long term.
- During 3Q21, GICSA signed 61 agreements under the tenant Covid-19 support program for approximately Ps. 197 million in credit notes.
- In accordance with IFRS 16, Ps. 56 million was recognized in the income statement in 3Q21. The remaining balance is carried in the balance sheet and will be gradually amortized in accordance with the remaining term of each contract.
Operational
- GICSA reported a total of 995,047 square meters of Gross Leasable Area (GLA) comprised of 18 properties in operation at the close of 3Q21. Proportional GLA was 86%, equivalent to 855,663 square meters. This represented an increase of 9% in total GLA and 11% in proportional GLA, compared to 3Q20, mainly due to the addition of Lomas Altas and Explanda Culiacán to the Company's property portfolio.
- During 3Q21, GICSA opened 44 new doors (4,742 square meters) in relation to the portfolio in operation, a decrease of 20% compared to 2Q21.
- During 3Q21, GICSA signed 68 new doors (9,308 square meters) in relation to the portfolio, a decrease of 3% compared to 2Q21.
- At the close of 3Q21, the occupancy rate of the stabilized portfolio was 87%, and 82% of the total portfolio. The adjusted occupancy rate of the stabilized portfolio was 82% and 78% of the total portfolio.
- At the close of 3Q21, the renewal rate of the stabilized portfolio was 99%.
- At the close of 3Q21, the average rent per square meter of the stabilized portfolio was Ps. 373 and Ps. 372 of the total portfolio, decreases of 3% and 4%, respectively, compared to 3Q20.
- At the close of 3Q21, the lease spread of shopping malls within the stabilized portfolio was 4.4%, while in 3Q20 was 4.2% and during 3Q19, prior to the pandemic was 5.7%.
- At the close of 3Q21, the number of visitors to properties within the commercial portfolio reached 13 million, an increase of 52% compared to 3Q20 and a decrease of 2% compared to 2Q21. It is important to note that prior to the pandemic in 3Q19 the number of visitors was 18 million.
Financial
- Fixed rental revenues in 3Q21, after the proportional recognition of the tenant Covid-19 support program, was Ps. 637 million, a decrease of 22% compared to 3Q20.
- Total revenue in 3Q21, after the proportional recognition of the tenant Covid-19 support program, was Ps. 930 million, a decrease of 11% compared to 3Q20.
- Consolidated and proportional NOI in 3Q21, were Ps. 762 million and Ps. 645 million, decreases of 9% and 7%, respectively, compared to 3Q20.
- Consolidated and proportional EBITDA in 3Q21, were Ps. 702 million and Ps. 585 million, respectively, decreases of 11% and 10%, compared to 3Q20.
- Consolidated and proportional financial debt at the close of 3Q21 were Ps. 28,048 million and Ps. 25,503 million, respectively, increases of 2%, compared to consolidated debt in 3Q20. Consolidated LTV was 37%.
For a full version of GICSA's Third Quarter 2021 Earnings Release, please visit:
http://www.gicsa.com.mx/en/investors-relationship/financial-information
Conference Call
GICSA cordially invites you to its Third Quarter 2021 Conference call
Wednesday, October 27, 2021
11:00 AM Eastern time
10:00 AM Mexico City Time
Presenting for GICSA:
Mr. Isaac Cababie, Deputy Executive Director
Diódoro Batalla - Chief Financial Officer
To access the call, please dial:
1 (877) 830-2597 from within the U.S.
+1 (785) 424-1744 from outside the U.S.
Passcode: 44272
About the Company
GICSA is a leading company in the development, investment, commercialization and operation of shopping malls, corporate offices and mixed used well known for their high-quality standards, which transform and create new development spaces, lifestyles and employment in Mexico, in accordance with its history and executed projects. As of September 30, 2021, the Company owned 18 income-generating properties, consisting of eleven shopping malls, five mixed use projects (which include five shopping malls, five corporate offices and one hotel), and two corporate office buildings, representing a total Gross Leasable Area (GLA) 995,047 square meters, and a Proportional GLA of 855,663 square meters. Since June 2015, GICSA is listed on the Mexican Stock Exchange under the ticker (BMV: GICSA B).
Investor Relations Contact:
Claudia Chávez
Tel: +52 (55) 5148 0400 Ext. 4609
Email: cchavez@gicsa.com.mx
Yinneth Lugo, IR
Tel: +52 (55) 5148 0402
Email: ylugo@gicsa.com.mx
SOURCE: GRUPO GICSA, S.A.B. DE C.V.
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