News Article | March 1, 2017
JACKSONVILLE, Fla. & NEW YORK--(BUSINESS WIRE)--Regency Centers Corporation (NYSE: REG) (“Regency”) and Equity One, Inc. (NYSE: EQY) (“Equity One”) today announced the completion of their previously announced merger, whereby Equity One merged with and into Regency, with Regency continuing as the surviving public company. The merger forms a combined company with a total market capitalization of approximately $16 billion. Beginning March 2, 2017, Regency will be a member of the S&P 500 index. “We are delighted to announce the completion of our merger with Equity One, further establishing Regency Centers as the preeminent national shopping center REIT,” stated Martin E. “Hap” Stein, Jr., Chairman and Chief Executive Officer. “With a high quality portfolio of 429 properties located in many of the country’s top markets, featuring outstanding demographics, augmented by a best-in-class development and redevelopment program, we believe Regency offers a unique long-term growth profile. Further, as we have stated before, we expect the transaction to be accretive to core FFO per share while preserving our sector-leading balance sheet. Moving ahead, we look forward to the rapid integration of the two platforms and to creating additional value for our shareholders over the quarters and years to come.” The completion of the transaction follows the satisfaction of all conditions to the closing of the merger, including receipt of approvals of the merger and other merger-related proposals by Regency and Equity One stockholders, which approvals were obtained on February 24, 2017. Pursuant to the terms of the definitive merger agreement entered into by and between Regency and Equity One on November 14, 2016, Equity One stockholders are entitled to receive 0.45 of a newly issued share of Regency common stock for each share of Equity One common stock that they owned immediately prior to the effective time of the merger. The common stock of the combined company will trade under the symbol “REG” on the NYSE, and the Equity One common stock will be suspended from trading on the NYSE effective as of the opening of trading on March 2, 2017. In connection with the completion of the merger, the Regency board of directors has appointed Joseph Azrack, Chaim Katzman and Peter Linneman, former Equity One directors, to serve on Regency’s board. Mr. Katzman, the former Chairman of Equity One’s board, will serve as non-executive Vice Chairman of the Regency board. Regency’s current executive officers will continue to serve in their current positions. Following the merger, Regency now expects the combined portfolio to produce annual Same Property NOI growth for 2017 within a new range of 3.0% to 3.8%. This compares to previous guidance for Regency as a stand-alone entity of 2.25% to 3.00%. Regency expects to realize annualized cost savings of approximately $27 million by 2018, primarily related to the elimination of duplicative corporate and property-level operating costs. The transaction is expected to be accretive to Core FFO, assuming the anticipated full cost benefits, before the positive incremental impacts of merger-related purchase accounting adjustments, and after potential dispositions. Regency will update its guidance more completely when it reports first quarter 2017 results. J.P. Morgan Securities LLC acted as financial advisor, and Wachtell, Lipton, Rosen & Katz acted as legal advisor, to Regency in connection with the merger. Barclays Capital Inc. acted as lead financial advisor, Citigroup Global Markets Inc. acted as co-financial advisor, and Kirkland & Ellis LLP acted as legal advisor to Equity One in connection with the merger. ICR, LLC served as communications advisor for the transaction. Regency is the preeminent national owner, operator and developer of neighborhood and community shopping centers which are primarily anchored by productive grocers and located in affluent and infill trade areas in the country’s most attractive metro areas. As of December 31, 2016, Regency’s portfolio of 307 retail properties encompassed over 42.2 million square feet, which includes properties held in co-investment partnerships. Regency has developed 225 shopping centers since 2000, representing an investment at completion of more than $3.5 billion. Operating as a fully integrated real estate company, Regency is a qualified real estate investment trust that is self-administered and self-managed. About Equity One, Inc. As of December 31, 2016, Equity One’s portfolio comprised 122 properties, including 101 retail properties and five non-retail properties totaling approximately 12.8 million square feet of gross leasable area, or GLA, 10 development or redevelopment properties with approximately 2.3 million square feet of GLA, and six land parcels. As of December 31, 2016, Equity One’s retail occupancy excluding developments and redevelopments was 95.8% and included national, regional and local tenants. Additionally, Equity One had joint venture interests in six retail properties and two office buildings totaling approximately 1.4 million square feet of GLA. The information presented herein may contain forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 giving Regency’s or Equity One’s expectations or predictions of future financial or business performance or conditions. Forward-looking statements are typically identified by words such as “believe,” “expect,” “anticipate,” “intend,” “target,” “estimate,” “continue,” “positions,” “prospects” or “potential,” by future conditional verbs such as “will,” “would,” “should,” “could” or “may”, or by variations of such words or by similar expressions. These forward-looking statements are subject to numerous assumptions, risks and uncertainties which change over time. Forward-looking statements speak only as of the date they are made and we assume no duty to update forward-looking statements. As forward-looking statements involve significant risks and uncertainties, caution should be exercised against placing undue reliance on such statements. In addition to factors previously disclosed in Regency’s and Equity One’s reports filed with the Securities and Exchange Commission and those identified elsewhere in this communication, the following factors, among others, could cause actual results to differ materially from forward-looking statements and historical performance: the outcome of any legal proceedings that are or may be instituted against Regency or Equity One; the possibility that the anticipated benefits of the transaction are not realized when expected or at all, including as a result of the impact of, or problems arising from, the integration of the two companies or as a result of changes in the economy and competitive factors in the areas where Regency and Equity One do business; diversion of management’s attention from ongoing business operations and opportunities; potential adverse reactions or changes to business or employee relationships, including those resulting from the completion of the transaction; Regency’s ability to complete the integration of Equity One successfully or fully realize cost savings and other benefits and other consequences associated with mergers, acquisitions and divestitures; changes in asset quality and credit risk; the potential liability for a failure to meet regulatory requirements, including the maintenance of REIT status; material changes in the dividend rates on securities or the ability to pay dividends on common shares or other securities; potential changes to tax legislation; changes in demand for developed properties; adverse changes in financial condition of joint venture partner(s) or major tenants; risks associated with the acquisition, development, expansion, leasing and management of properties; risks associated with the geographic concentration of Regency; risks associated with the concentration of tenants; the impact of the transactions on relationships, including with tenants, employees, customers and competitors; significant costs related to uninsured losses, condemnation, or environmental issues; the ability to retain key personnel; and changes in local, national and international financial market, insurance rates and interest rates. Regency does not intend, and undertakes no obligation, to update any forward-looking statement.
News Article | February 15, 2017
C57BL/6N mice, ICR mice and Wistar rats were purchased from SLC Japan (Shizuoka, Japan). All animals were maintained under specific pathogen-free conditions. All animal experiments were approved by the Insititutional Animal Care and Use Committee, and performed in accordance with the guidelines of the University of Tokyo and the National Institute for Physiological Sciences. Diabetes was induced in 8-week-old C57BL/6N male mice by intravenous injection of 150 mg kg−1 of STZ. Mice with nonfasting blood glucose levels over 350 mg dl−1 1 week after STZ administration were used. Embryo culture and manipulation are described11. Rodent islets conventionally are isolated by collagenase perfusion of the pancreata through the common bile duct. However, the pancreata of Pdx1mu/mu chimaeric rats could not be perfused in this way because the pancreaticobiliary junction was maldeveloped in all (Extended Data Fig. 5). Therefore, we isolated islets by digestion of minced pancreata with collagenase. Pancreata removed from interspecific chimaera were inflated by interstitial injection of Gey’s balanced salt solution (GBSS; Sigma-Aldrich). GBSS-filled pancreata were minced using scissors. Small pieces of chopped pancreata were digested with collagenase XI (Sigma-Aldrich) to release islets from exocrine tissue. After 6–8 min incubation, islets were picked up using glass micropipettes and transplanted beneath the kidney capsule of 10-week-old male mice with STZ-induced diabetes, as previously described11. To prevent acute graft rejection, 0.5 mg per g (body weight) per day of tacrolimus, was injected intraperitoneally on the day of transplantation and on each of the following 4 days, in addition to an anti-inflammatory cocktail (all components, Affymetrix) containing anti-mouse interferon-γ mAb (rat IgGκ, 16-7312, clone R4-6A2), anti-mouse tumour necrosis factor-α mAb (rat IgG1κ, 16-7322, clone MP6-XT3) and anti-mouse IL-1β (hamster IgG, 16-7012, clone B122). The mRNA of TALENs (left and right) and rat Exo1 were generated by in vitro transcription. Linearized plasmids were transcribed from T7 promoter using mMESSAGE mMACHINE T7 ULTRA Transcription Kit (Thermo Fisher Scientific) and resultant mRNAs were cleaned up by MEGAclear Kit (Thermo Fisher Scientific). 3 or 10 ng μl−1 of each mRNA was prepared by dilution in RNase- free-water and mixture of right TALEN, left TALEN and Exo1 were injected into the male pronuclei of zygotes by microinjection, as previously reported18. TALEN potential off-target sites were predicted by TALENoffer software. We chose 21 candidates (5 in exonic loci, 13 in intronic loci, 3 in intergenic loci) from TOP200 candidates19. We performed PCR amplification of genomic DNA from Pdx1+/muA, Pdx1+/muB and wild-type Wistar rats, subjecting the amplicons to Sanger sequencing. Genomic DNA was isolated from fluorescent-marker-negative cells isolated by FACS from chimaeric-rat blood samples. The TALEN target region of Pdx1 was amplified by PCR using the following primers: (forward) 5′-GCTGAGAGTCCGTGAGCTGCCCAG-3′ and (reverse) 5′-GGAACGCTTAAAGATCGTAGCAGC-3′). The PCR products were sequenced. Total RNA was isolated from duodenum of Pdx1muA/muB mice and reverse-transcribed by Superscript III reverse transcriptase (Thermo Fisher Scientific) with oligodT primer. Pdx1muA or Pdx1muB full-length cDNA were amplified by PCR using the following primers: (forward) 5′-GGCGCTGAGAGTCCGTGAGCTGC-3′ and (reverse) 5′-TTTTTTTTTTTTTTTGAAACCTCAAACAG-3′. Nonfasting blood glucose levels were determined (Medisafe-Mini glucometer; Terumo) weekly after islet transplantation. GTTs in overnight-fasted chimaera rats was conducted 0, 15, 30, 60 and 120 min after intraperitoneal injection of glucose (50% d-glucose solution, 2.5 g per kg body weight). Tail-vein blood was sampled by phlebotomy. Non-fasting serum mouse or rat c-peptide levels were analysed by enzyme-linked immunosorbent assay (ELISA) (mouse c-peptide ELISA kit, Shibayagi and Morinaga Institute of Biological Science; rat c-peptide ELISA kit, MERCODIA AB). Serum was isolated from 10-week-old Pdx1muA/muB + mPSCs chimaeras, C57BL/6N mice and Wistar rats. Serum was obtained from STZ-treated diabetic mice transplanted with mouseR islets 260 or 372 days after transplantation. SGE2 (EGFP-expressing mES cells) were derived from blastocysts generated from mating C57BL/6N female mice with C57BL/6N-Tg male mice (CAG-EGFP) (SLC Japan). mRHT (mES cells) were derived from blastocysts generated from mating male and female H2B-tdTomato knock-in mice with human histone H2B and tdTomato fusion gene in the mouse ROSA locus (T.K., unpublished data). Wlv3i-1 (rES cells) and GT3.2 (miPSCs) have been previously described11, 31. Maintenance of mPSCs and rPSCs has been previously described32, 33. Briefly, mPSCs were cultured on mitomycin-C-treated mouse embryonic fibroblasts in Dulbecco’s modified Eagle’s medium supplemented with 10% fetal bovine serum, 0.1 mM 2-mercaptoethanol, 0.1 mM nonessential amino acids, 1 mM sodium pyruvate, and 1,000 units per ml of mouse leukaemia inhibitory factor (all Thermo Fisher Scientific) and 1% l-glutamine-penicillin-streptomycin (Sigma-Aldrich). rPSCs were cultured on mitomycin-C-treated mouse embryonic fibroblasts in N2B27 medium supplemented with 1 μM mitogen-activated protein kinase inhibitor PD0325901 and 3 μM glycogen synthase kinase inhibitor CHIR99021 (both Axon Groeningen). All PSC lines were authenticated by chimaera formation. These cell lines were not contaminated with mycoplasma. Isolated pancreata and islets were fixed in 4% paraformaldehyde in phosphate-buffered saline solution (PBS). Paraffin-embedded sections were incubated with blocking buffer (Active Motif) for 1 h at room temperature. The sections were incubated with primary antibodies, diluted in blocking buffer for 1 h at room temperature, and washed three times with PBS. They were then incubated with secondary antibodies for 1 h at room temperature. Primary antibodies used were guinea pig anti-insulin (Abcam; ab7842), rabbit anti-glucagon (Nichirei Bioscience, 422271), rabbit anti-somatostatin (Nichirei Bioscience 422651), rabbit anti-cytokeratin 19 (Abcam; ab52625, clone EP1580Y), mouse anti-amylase (SantaCruz; SC-46657, clone G-10) and goat anti-GFP (Abcam; ab6673), with Alexa-488-, Alexa-546-, and Alexa-633-conjugated secondary antibodies (Thermo Fisher Scientific). After antibody treatment, sections were mounted with Vectashield (Vector Laboratories), a mounting medium containing DAPI (Thermo Fisher Scientific) for nuclear counterstaining, and sections were observed under fluorescence microscopy. Three to five sections per slide were imaged and processed using Image J. For detection of lymphoid infiltration, DAB immunohistochemistry was performed with rabbit anti-CD3 (Abcam; ab5690) and rabbit anti-CD11b (Bioss Inc.; bs-1014R). Islets or small pieces of kidney that included transplanted islets were dispersed into single cells with collagenase type1A (Sigma-Aldrich). Dispersed cells stained with phycoerythrin (PE)-conjugated anti-mouse CD31 (Thermo Fisher Scientific; A16201, clone 390) or allophycocyanin (APC)-conjugated anti-rat CD31 (Thermo Fisher Scientific; 50-0310-82, clone TLD-3A12) were subjected to FACS CantoII analysing (BD Biosciences). Data were collected for all of the dispersed cells and analysed. The experiments were not randomized and the investigators were not blinded to allocation during experiments and outcome assessment. Sample size was estimated on the basis of previous publications. Statistical significance was calculated by F-test and Student’s t-test (compare two groups) and the similarity to the Mendelian ratio was analysed by chi-square test (with Excel and Graphpad Prism software). P < 0.05 was considered to be statistically significant. Data are presented as mean ± s.d. Immunohistochemistry and flow-cytometry studies were repeated three times independently with similar results. All relevant data that are included with this study are available from corresponding auther upon reasonable request.
News Article | February 28, 2017
OLDWICK, N.J.--(BUSINESS WIRE)--A.M. Best has affirmed the Financial Strength Ratings of A (Excellent) and the Long-Term Issuer Credit Ratings (Long-Term ICR) of “a” of CMFG Life Insurance Company (CMFG Life), the lead life and annuity insurance writer, and MEMBERS Life Insurance Company (Members Life), a life and annuity subsidiary, as well as CUMIS Insurance Society, Inc. (CUMIS), the lead property/casualty writer, and CUMIS Specialty Insurance Company, Inc. (CUMIS Specialty), a property/casualty subsidiary. Concurrently, A.M. Best has affirmed the Long-Term ICR of “bbb” of CUNA Mutual Financial Group, Inc., an intermediate holding company within the group. Additionally, A.M. Best has affirmed the Long-Term Issue Credit Rating of “bbb+” on the $85 million, 8.5% surplus notes issued by CMFG Life due 2030. The outlook of these Credit Ratings (ratings) is stable. The ultimate parent for all companies is CUNA Mutual Holding Company. All operating companies are domiciled in Iowa but are headquartered in Madison, WI. The ratings of CMFG Life reflect the company’s position as the leading provider of insurance and financial services products to credit unions, their employees and members. Furthermore, CMFG Life has reported favorable growth in its new product offerings, particularly its annuities issued through Members Life, which provides sales and earnings diversification, and offsets premium losses from discontinued product lines. CMFG Life’s capital position has been consistently increasing in recent periods and is more than adequate to support its insurance, investment and business risks. Partially offsetting these positive rating factors is the increasing concentration of the business profile, as the organization has divested of several operations that do not align with its business strategy. Consolidated operations have been fairly stable; however, the company has experienced volatility within its core lines of business. Furthermore, A.M. Best notes that CMFG Life maintains some exposure to legacy long-term care, and variable annuities with guaranteed benefits that are viewed as higher-risk products, which could impact earnings and reserves in the challenging macro-economic environment. The ratings for CUMIS and CUMIS Specialty reflect their favorable level of risk-adjusted capitalization, overall operating profitability and well-established position in the credit union segment. The ratings also reflect the benefits CUMIS derives from the financial flexibility and diversified operations of its parent, CMFG Life. These rating factors are offset partially by the execution risk associated with growing its personal lines business, and pressure from general macroeconomic trends and varying market conditions in several of its product lines. This press release relates to Credit Ratings that have been published on A.M. Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see A.M. Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Understanding Best’s Credit Ratings. A.M. Best is the world’s oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com. Copyright © 2017 by A.M. Best Rating Services, Inc. and/or its subsidiaries. ALL RIGHTS RESERVED.
News Article | January 3, 2017
WINSTON-SALEM, N.C., Jan. 03, 2017 (GLOBE NEWSWIRE) -- Primo Water Corporation (Nasdaq:PRMW), the leading provider of multi-gallon purified bottled water, self-service refill water and water dispensers, today announced that management will present at the 2017 ICR Conference on Tuesday, January 10, 2017 at 11:30 a.m. ET. The audio portion of the presentation will be webcast live, and a replay will be available until Tuesday, January 24, 2017 on the investor relations section of Primo Water's website at http://ir.primowater.com under "Events and Presentations." About Primo Water Corporation Primo Water Corporation (Nasdaq:PRMW) is North America’s leading single source provider of multi-gallon purified bottled water, self-service refill water and water dispensers sold through major retailers throughout the United States and Canada. For more information and to learn more about Primo Water, please visit our website at www.primowater.com.
News Article | January 5, 2017
NEWINGTON, N.H., Jan. 05, 2017 (GLOBE NEWSWIRE) -- Planet Fitness, Inc. (NYSE:PLNT), one of the largest and fastest-growing franchisors and operators of fitness centers in the U.S., today announced that the Company will participate in the 2017 ICR Conference, held at the JW Marriott Orlando Grande Lakes in Orlando, Florida. Management is scheduled to present on Tuesday, January 10, 2017 at 8:00 a.m. Eastern Time. A live webcast of the presentation will be available at http://investor.planetfitness.com. About Planet Fitness Founded in 1992 in Dover, N.H., Planet Fitness is one of the largest and fastest-growing franchisors and operators of fitness centers in the United States by number of members and locations. As of September 30, 2016, Planet Fitness had more than 8.7 million members and more than 1,200 stores in 47 states, the District of Columbia, Puerto Rico, Canada and the Dominican Republic. The Company's mission is to enhance people's lives by providing a high-quality fitness experience in a welcoming, non-intimidating environment, which we call the Judgement Free Zone®. More than 90% of Planet Fitness stores are owned and operated by independent business men and women.
News Article | March 1, 2017
Coloring hair has become a common practice, particularly for people who want to hide their graying locks. But an ingredient in many of today's commercial hair dyes has been linked to allergic reactions and skin irritation. Now scientists have developed a potentially safer alternative by mimicking the hair's natural color molecule: melanin. Their report appears in the journal ACS Biomaterials Science & Engineering. The permanent hair dye ingredient p-phenylenediamine (PPD) has been associated, although rarely, with allergic reactions including facial swelling and rashes. Coloring hair with natural melanin would be an intuitive alternative to PPD. But previous research has found that the pigment molecules clump together, forming rods and spheres too large to penetrate into the hair shaft to create lasting color. Jong-Rok Jeon and colleagues wanted to build on the idea of using melanin but with a molecule that mimics the real thing. The researchers turned to polydopamine, a black substance that is structurally similar to melanin and has been explored for use in a variety of biomedical applications. Polydopamine with iron ions transformed gray hairs into black and lasted through three wash cycles. Lighter shades could also be achieved with polydopamine by pairing it with copper and aluminum ions. And toxicity tests showed that mice treated with the colorant didn't have noticeable side effects, while those that received a PPD-based dye developed bald spots. Explore further: Hair dyeing poised for first major transformation in 150 years More information: Kyung Min Im et al. Metal-Chelation-Assisted Deposition of Polydopamine on Human Hair: A Ready-to-Use Eumelanin-Based Hair Dyeing Methodology, ACS Biomaterials Science & Engineering (2017). DOI: 10.1021/acsbiomaterials.7b00031 Abstract Permanent dyeing of gray hair has become an increasingly active area in the cosmetics industry because of the increasingly aging population in developed countries. So far, p-phenylenediamine (PPD) and related diamine-based monomeric compounds have been widely used for the dyeing processes, but toxicological studies have revealed such compounds to be carcinogenic and allergenic. Here, we for the first time demonstrated that polydopamine, a mimic of human eumelanin, gives rise within a commercially acceptable period of time (i.e., 1 h) to deep black colors (i.e., natural Asian hair colors) in human keratin hairs in the presence of ferrous ions. The dyed hairs showed excellent resistance to conventional detergents, and the detailed color was readily varied by changing the kind of metal ion used. SEM images and FT-IR-ATR spectra suggested that the extent of polydopamine aggregation was crucial for the dyeing efficiency. High-resolution (15 T) FT-ICR mass spectrometry performed on the products detached from hairs with either 0.1 N HCl or NaOH indicated that similar polydopamine products were recruited into the hair matrices whether in the presence or absence of metal-based chelating. Polydopamine chains were determined using EPR and ICP-OES to use chelation of ferrous ions to self-assemble as well as to bind keratin surfaces in the dyeing conditions. Also, mice subjected to skin toxicity tests showed much greater viability and much less hair loss with our dyeing agents than with PPD. In conclusion, this study showed that a safe eumelanin mimic may be used to permanently dye gray hair, and showed three kinds of deposition mechanisms (i.e., innate binding ability of polydopamine, metal-assisted self-assembly of polydopamine, and metal-related bridging between keratin surface and polydopamine) to be involved.
News Article | January 4, 2017
SALT LAKE CITY, Jan. 04, 2017 (GLOBE NEWSWIRE) -- LifeVantage Corporation (Nasdaq:LFVN), announced today that Darren Jensen, the Company's President and Chief Executive Officer will be presenting at the ICR Conference 2017, to be held January 9-11, 2017, at the JW Marriott Orlando Grande Lakes in Orlando, Florida. LifeVantage Corporation’s investor presentation is scheduled for Wednesday, January 11, 2017, at 10:00 a.m. Eastern Time. The presentation will be webcast live and archived on the Investor Info portion of the Company's website at http://investor.lifevantage.com/events.cfm. LifeVantage Corporation (Nasdaq:LFVN), is a science-based direct selling company dedicated to visionary science that looks to transform health, wellness and anti-aging internally and externally at the cellular level. The company is the maker of Protandim® Nrf2 and NRF1 Synergizers, its line of scientifically-validated dietary supplements, the TrueScience® Anti-Aging Skin Care Regimen, Canine Health®, the AXIO® energy product line and the PhysIQ™ Smart Weight Management System. LifeVantage was founded in 2003 and is headquartered in Salt Lake City, Utah. www.lifevantage.com
News Article | January 9, 2017
PHILADELPHIA, PA, Jan. 09, 2017 (GLOBE NEWSWIRE) -- Five Below, Inc. (NASDAQ:FIVE) (“Five Below” or the “Company”) today announced net sales results for the quarter-to-date period from October 30, 2016 through January 7, 2017 ("Holiday Period") and updated guidance for its fourth quarter and full year for fiscal 2016 ending January 28, 2017. The Company announced that net sales for the Holiday Period, which includes New Year’s Day in both periods, increased by 18.0% to $349.3 million from $296.2 million in the comparable fiscal week period of 2015. Comparable sales for the Holiday Period increased by 0.5%. Joel Anderson, CEO of Five Below, stated: "After a solid start to the holiday season, we experienced softness in mid-December, including Super Saturday, with sales accelerating later in the holiday season. We had strong performance in our tech and room categories that were not up against the strong license and trend-driven comparisons from last year, as well as good performance in markets where we ran TV for the first time. In addition, our new 2016 stores continue to perform well and are on track to be one of our strongest classes ever." Mr. Anderson added, “Given our holiday performance, we are updating our outlook for the full year 2016 and now expect sales growth of 20% and EPS growth of 22% to 23%. We remain committed to delivering on our goals of 20% top line and 20% bottom line growth through 2020, and we look forward to discussing 2016 and our outlook for 2017 on our fourth quarter earnings call in March.” Based on the quarter-to-date performance, the Company updated its guidance for the fourth quarter and fiscal year 2016. For the fourth quarter, net sales are now expected to be in the range of $386 million to $388 million, or growth of 18% to 19% assuming a comparable sales increase of approximately 1%. Diluted income per common share for the fourth quarter is expected to be in the range of $0.88 to $0.89, or approximately 14% to 16% growth. For the full year fiscal 2016, net sales are now expected to be in the range of $998 million to $1,000 million, or growth of 20% assuming a comparable sales increase of approximately 2%. Diluted income per common share for fiscal 2016 is expected to be in the range of $1.28 to $1.29, or approximately 22% to 23% growth. The Company also announced that management will participate in the 19th Annual ICR Conference held at the JW Marriott Orlando Grande Lakes in Orlando, Florida. Management is currently scheduled to conduct a fireside chat on Tuesday, January 10, 2017 at 8:30 a.m. Eastern Time. The fireside chat will be webcast live at http://investor.fivebelow.com/. An archived replay will be available two hours after the conclusion of the live event. About Five Below: Five Below is a rapidly growing specialty value retailer offering a broad range of trend-right, high-quality merchandise targeted at the teen and pre-teen customer. Five Below offers a dynamic, edited assortment of exciting products in a fun and differentiated store environment, all priced at $5 and below. Select brands and licensed merchandise fall into the Five Below worlds: Style, Room, Sports, Tech, Crafts, Party, Candy, and Now. Five Below was founded in 2002 and is headquartered in Philadelphia, Pennsylvania, with over 500 stores in 31 states. For more information, please visit www.fivebelow.com or come into one of our stores! Forward-Looking Statements: This news release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 as contained in Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, which reflect management's current views and estimates regarding the Company's industry, business strategy, goals and expectations concerning its market position, future operations, margins, profitability, capital expenditures, liquidity and capital resources and other financial and operating information. Investors can identify these statements by the fact that they use words such as "anticipate," "assume," "believe," "continue," "could," "estimate," "expect," "intend," "may," "plan," "potential," "predict," "project," "future" and similar terms and phrases. The Company cannot assure investors that future developments affecting the Company will be those that it has anticipated. Actual results may differ materially from these expectations due to risks related to the Company's strategy and expansion plans, risks related to the inability to successfully implement our expansion into online retail, the availability of suitable new store locations and the dependence on the success of shopping centers in which our stores are located, risks that consumer spending may decline and that U.S. and global macroeconomic conditions may worsen, risks related to the Company's continued retention of its senior management and other key personnel, risks related to changes in consumer preferences and economic conditions, risks related to increased operating costs, including wage rates, risks related to extreme weather, risks related to the Company's distribution centers, quality or safety concerns about the Company's merchandise, events that may affect the Company's vendors, increased competition from other retailers including online retailers, risks related to cyber security, risks related to customers' payment methods, risks related to trade restrictions, and risks associated with leasing substantial amounts of space. For further details and a discussion of these risks and uncertainties, see the Company's periodic reports, including the annual report on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K, filed with or furnished to the Securities and Exchange Commission and available at www.sec.gov. If one or more of these risks or uncertainties materialize, or if any of the Company's assumptions prove incorrect, the Company's actual results may vary in material respects from those projected in these forward-looking statements. Any forward-looking statement made by the Company in this news release speaks only as of the date on which the Company makes it. Factors or events that could cause the Company's actual results to differ may emerge from time to time, and it is not possible for the Company to predict all of them. The Company undertakes no obligation to publicly update any forward looking statement, whether as a result of new information, future developments or otherwise, except as may be required by any applicable securities laws.
News Article | February 23, 2017
Value creation potential further strengthened in 2016 …around the four core strategic pillars defined at the start of 2015 with three new driving forces for acceleration: 1 All the figures presented in this document exclude any impact for IFRS 5 as well as the costs linked to the offer for Foncière de Paris, representing 4.2 million euros 2 Restated for costs linked to the departure of the previous Chief Executive Officer, recurrent net income represents 349.7 million euros (+0.1%) 3 Subject to approval by the General Meeting Strong focus on creating value and rationalizing the portfolio in 2016 Following on from an exceptional year for its portfolio’s rotation in 2015, Gecina maintained its firm focus on rationalizing its portfolio and creating value in 2016. The Group has secured nearly 2.0 billion euros of sales of real estate assets, delivering an immediate accretive impact on NAV, with 644 million euros excluding the healthcare portfolio’s sale and an average premium of around +15% versus the latest appraisal values, capitalizing on favorable conditions on the investment market to maximize value extraction by divesting mature or non-strategic assets. Alongside this, Gecina secured nearly 321 million euros of new investments in 2016 in the best business districts in the Paris Region, at the heart of Paris (rue Guersant, rue de Madrid) and in the Southern Loop of Paris’ Western Crescent (Be Issy in Issy-les-Moulineaux), through operations with strong potential for creating value. The total pipeline for development and redevelopment operations is up to over 3.7 billion euros, despite the delivery of two major projects in 2016 (City 2 and Le Cristallin in Boulogne). Seven new development projects were launched in 2016, thanks to the new investments secured during the year (Be Issy and rue de Madrid), as well as five new redevelopment operations that started up in 2016 on assets within the portfolio after the properties were vacated (three new projects in Paris City, with the other two located in Neuilly and Levallois-Perret). Gecina's pipeline for committed projects is up to over 1.5 billion euros (versus 910 million euros at end-2015), based on 15 operations, with nearly 90% located in Paris City and the Western Crescent's best sectors (Issy-les-Moulineaux, Neuilly and Levallois). This committed pipeline will have a significant accretive impact on NAV as the work progresses and on recurrent net income when the projects are delivered, expected for 2017 to 2019. NAV climbed +7.7% to 132.1 euros per share in 2016, with an increase of around +9.5 euros per share, driven primarily by the total return strategy rolled out, particularly with capital gains from sales, as well as growth in the value of assets acquired recently or under development. Including the 5 euro dividend paid in 2016, the total property return performance comes out at nearly +12%. Recurrent net income (Group share) was stable in 2016 compared with 2015 (-0.5%). Restated for costs linked to the departure of the previous Chief Executive Officer, recurrent net income represents 349.7 million euros (+0.1%). This performance factors in significant changes in scope, particularly with the major acquisitions made in 2015 (primarily the T1&B buildings in La Défense and the PSA Group's current headquarters in Paris' CBD), as well as sales of mature and non-strategic assets concentrated primarily over 2016 (sales of the healthcare portfolio and office buildings located in non-strategic areas for Gecina). The performance for 2016 also reflects the continued optimization of financial expenses, down -28.3%, with an overall average cost of debt of 2.2% (down 50 bp) and a significant increase in the maturity of drawn debt and rate hedging. Very positive market environment for central sectors, particularly in Paris City Take-up in Paris City - where Gecina holds 54% of its office portfolio – climbed +14% in 2016, accounting for nearly half of the total volume of transactions for the Paris Region, while immediate supply is down -30%. The vacancy rate for Paris City is close to an all-time low, with 3.5%, reflecting a shortage of quality properties. CBRE reports that a growing percentage of transactions are motivated by a preference for central locations, recognized as a productivity factor, while also making it possible to limit staff turnover, particularly for high value-added employees. These positive trends are in line with Gecina's expectations and confirm the relevance of the Group's realignment strategy announced at the start of 2015. The delivery of projects currently under development is expected to cover these growing needs, which will accelerate if this trend is reinforced by businesses relocating as a result of Brexit. Gecina is confirming its main strategic guidance as presented at the start of 2015 and will continue building on its progress from the last few years around four core pillars for creating value (Value added investments, opportunistic disposals, Harnessing value from our own portfolio and innovation), with its ambition to accelerate the process underway. Gecina's teams are already working on the following three drivers for acceleration: Outlook for the short and medium term 2017 will be marked by these strong choices made by Gecina in terms of value extraction, particularly the asset sales completed in 2016 and the launch of work to redevelop five buildings that were previously occupied, in order to optimize their value extraction. In 2017, recurrent net income, restated for the impact of the healthcare sale, is expected to contract by nearly -5% to -6%4. This expected performance reflects the combined impact of underlying growth, which is expected to reach around +2% to +3%5, and the start of redevelopment projects, which will be accretive when they are delivered, expected primarily for 2018 and 2019. Gecina therefore has very strong potential for growth and value extraction through its pipeline in particular, as well as positive trends for the Group's preferred sectors. In view of this, average recurrent net income growth (CAGR) over the medium term (between 2018 and 2021) is expected to come in at around +5% to +7%6. As a result, considering the Group’s confidence in its outlook for the medium term, Gecina plans to submit a proposal at the general meeting for a dividend up +4% to 5.20 euros per share for 2016. 4 These objectives do not include assumptions for any sales or investments and may therefore be revised up or down depending on opportunities for investments and sales during the year 5 Including the impact of sales (excluding healthcare) in 2016, deliveries of assets in 2016 and 2017, and organic growth 6 This objective may be revised up or down depending on opportunities for investments and sales Méka Brunel, Chief Executive Officer: “Our strategic project is moving forward, and we firmly believe that the direction taken by the Group since early 2015 is the right one for the future. In an environment marked by the end of rate cuts, it is essential to move more quickly and not curb our ambitions. Today, even more than in the past, we need to be selective, responsive and flexible, in a market that will involve not only new risks, but also new opportunities that will need to be capitalized on effectively. A dynamic approach therefore needs to be set in motion to give the Group's ambitions a new dimension. Our operational performances from 2016 are solid and encouraging, and our pipeline offers a source of value creation and growth that is unrivalled in continental Europe, in order to better serve our shareholders in the future”. Bernard Michel, Chairman: “The strategy put in place at the start of 2015 is already delivering benefits, as shown by our results for 2016. Acknowledging the major work accomplished by Gecina's teams, the Board of Directors believes that the strategy can be ramped up again in order to accelerate our effective creation of value. The Board is aware of Gecina's strategic potential and is therefore embarking on this new phase in the Group's history with confidence”. Rental income in line with the Group’s forecasts Gross rental income came to 540 million euros in 2016, down -6.0%, reflecting the significant changes in scope from the last two years. Like-for-like, rental income shows a moderate contraction of -0.5%. Like-for-like, this moderate contraction of -0.5% at end-2016 is consistent with the Group’s expectations. It factors in the level of indexation, which is still low (+0.2%), and the slightly negative reversion resulting from renegotiations in 2015, some of which came into effect at the start of 2016. Like-for-like growth has also been impacted by the departure of a tenant from a building located in the Outer Rim, while part of the space vacated has already been relet. Excluding just this asset, rental income is stable like-for-like (+0.1%). On a current basis, the -6.0% reduction is linked primarily to the high volume of sales completed and particularly the healthcare portfolio's sale, finalized on July 1, 2016. This drop also reflects the sales programs rolled out in 2015 and 2016, making it possible to achieve significant capital gains on residential assets, as well as mature or non-strategic office buildings. Lastly, the change in rental income on a current basis also factors in the temporary loss of rental income from office buildings with strong value creation potential, on which redevelopment work has been launched following their tenants' departures. Over the period, the additional rent generated by acquisitions and deliveries made in 2015 and 2016 totaled +46.1 million euros, with the T1&B buildings in La Défense, PSA-Grande Armée in Paris' CBD, City 2 in Boulogne-Billancourt, Guersant-2 in Paris and four student residences. On the other hand, the loss of rental income resulting from sales represents -70.5 million euros, with -37.1 million euros from the healthcare portfolio's sale and -33.4 million euros resulting from sales of commercial and residential assets in 2015 and 2016, particularly in Gentilly, Boulogne-Billancourt, La Garenne-Colombes, Neuilly, Suresnes and Rueil Malmaison. The change in rental income also reflects the impact of the building redevelopment projects launched in 2015 and 2016, representing a loss of rent of around -8.2 million euros. Offices: rental income up thanks to the Group’s growing specialization On a current basis, rental income from offices is up +2.4% thanks in particular to the impact of the acquisition of the T1&B buildings in La Défense and PSA’s current headquarters in Paris’ CBD in the second half of 2015, as well as acquisitions immediately generating rental income that were finalized in 2016 (City 2 in Boulogne-Billancourt, Guersant-2 in Paris). Over the year, these acquisitions offset the impact of sales and redevelopments (particularly the Paris-Guersant 1 building in 2015, as well as the Octant-Sextant assets in Levallois, Paris-Ville l’Evêque, Paris-Friedland and a real estate complex in Neuilly in 2016). Like-for-like, rental income is down slightly, with -0.5%, in line with the Group’s expectations. This slight contraction factors in a particularly low level of indexation (+0.2%) and the latest impacts of the renewals and renegotiations granted in 2015 and early 2016 on suburban Paris assets in return for extending the maturity of their leases. Like-for-like growth notably reflects the impact of the departure of Oracle, which vacated part of the Crystalys building in Vélizy at the end of August 2015 (in the Paris Region's Outer Rim). Today, this space has been partially relet. Excluding just this asset, like-for-like growth would be positive, with +0.3% for 2016. Like-for-like rental income growth is already positive for Paris City (+1.4%), confirming the first signs of rents picking up again in central sectors. In view of the improvement in rental market conditions in the Paris Region’s most central sectors, the like-for-like change in office rental income is expected to be positive in 2017. The trends observed for 2016 confirm Gecina’s confidence in the Paris Region’s most central business sectors picking up again. Although they reveal an upturn in take-up across the entire Paris Region, the Immostat statistics published recently show significantly contrasting trends within the region. While the most central areas and particularly Paris City have reached a rental turning point, the situation is still more delicate for more peripheral areas (Inner and Outer Rims), although Gecina has very few assets in these sectors. Take-up shows an average increase of +7% for the Paris Region compared with 2015, but the most central sectors have continued to account for the majority of the volume of transactions recorded. Take-up for Paris City climbed +14% in 2016, while the volume came in 32% higher than the 10-year average, accounting for nearly half of the total volume of transactions for the Paris Region. However, trends for the rest of the region are less positive, with an increase in take-up of only +1%, lower than the 10-year averages, particularly in more peripheral areas in the Inner and Outer Rims. Immediate supply levels are also contracting, with an average of -10% for the Paris Region. However, once again, the trends are very mixed and more positive for the most central sectors. While immediate supply levels are down -30% for Paris City and -7% for the Western Crescent and La Défense, they show only a moderate reduction for peripheral sectors (-5% for the Inner Rim and -2% for the Outer Rim). For Paris City, following the contraction in available supply, it now represents only 15% of total immediate supply for the Paris Region. As a result, the average vacancy rate for Paris City, reported by BNP Paribas Real Estate, is now down to less than 3.5% (vs. 5% at end-2015), highlighting the shortage of quality assets and moving close to an all-time low. On average for the Paris Region, this rate is down from 7.4% to 6.7%. The outlook in terms of available supply within one year suggests that the market balance will continue to be favorable in 2017. The lack of available supply for quality premises in the region's most central sectors is expected to support rental trends and confirm the moderate upturn in market rents seen primarily in Paris and La Défense. Rental income from traditional residential assets is virtually stable like-for-like (-0.3%), primarily due to no impact for indexation in 2016. On a current basis, the -6.2% contraction primarily factors in the program to sell apartments on a unit basis when they become vacant as tenants naturally free up assets. The student residence portfolio achieved strong growth in rental income (+17.5%) in 2016, driven by the major deliveries seen in the third quarter of 2015 in Paris, Bagnolet, Palaiseau-Saclay and Bordeaux. Like-for-like, rental income is down -1.6%, notably factoring in a temporary increase in the vacancy rate linked to work to overhaul the IT and operational systems in a residence in the Paris Region; excluding this residence, like-for-like growth comes out at +0.8%. The average financial occupancy rate for 2016 came to 95.5% excluding healthcare (95.9% including the healthcare portfolio), stable over six months and down slightly year-on-year, linked primarily to the delivery of Le Cristallin, which had not been let by the end of 2016. Indeed, this rate does not take into account the lease signed in January 2017 with the Renault Group to rent all of this asset. Significant lettings successes since the start of 2016 Gecina has secured major lettings transactions since the beginning of 2016, with nearly 95,000 sq.m let, prelet, relet or renegotiated. For instance, the Group has signed leases with CREDIPAR for the “Pointe Métro 2” building in Gennevilliers (10,000 sq.m), with the Orange Group for “SKY 56” in Lyon Part-Dieu (16,000 sq.m), with the Renault Group for “Le Cristallin” in Boulogne-Billancourt (11,600 sq.m), and with the Caisse Régionale RSI Ile-de-France for “Dock-en-Seine” (9 000 sq.m). Considering the discussions that are underway, Gecina is confident about the volume of transactions that will be able to be achieved in 2017. Recurrent net income (Group share) is almost stable year-on-year at 347.4 million euros (-0.5%). Excluding the costs linked to the departure of the previous Chief Executive Officer, recurrent net income (Group share) shows a very slight increase, up to 349.7 million euros (+0.1%). This stability reflects the impact of the acquisitions made in 2015 (including T1&B in La Défense and PSA’s current headquarters in Paris' CBD), as well as the continued optimization of financial expenses, which, during the year, offset the impact of the healthcare portfolio's sale (finalized on July 1, 2016) and the new projects launched to redevelop buildings after they have been vacated. The rental margin represents 92.4%, up 80 bp year-on-year, driven by the improved margin for the office portfolio, benefiting from the fully let, single-tenant assets acquired in 2015 being integrated into Gecina’s portfolio, with their higher rental margins than the Group average. The rental margin for offices also reflects the impact of the restatement of rental management fees previously recognized as revenue from “services and other income”. Like-for-like, the office rental margin is up +0.1%. 7 Recurrent net income excludes the costs linked to the offer for Foncière de Paris, representing 4.2 million euros Lower cost and higher average maturity for debt and hedging Gecina has continued to optimize its liabilities, capitalizing on a particularly positive environment to make progress on all its financial indicators. Net financial expenses are down -28.3% year-on-year to 86.0 million euros, thanks to the optimization work carried out in 2015 and 2016 in a very positive market environment. Overall, the average cost of debt (including undrawn credit lines) came to 2.2% for 2016, compared with 2.7% in 2015, down -50bp. As a result of this strong reduction in the average cost of debt and financial expenses, Gecina’s ICR shows a significant increase for the year, up from 3.9x at the end of 2015 to 4.9x at end-2016. In addition to optimizing the average cost of debt, Gecina has capitalized on favorable market conditions to increase its average maturity to 6.7 years (versus 5.7 years at end-2015). Gecina has also significantly strengthened hedging for its debt. At December 31, 2016, 77% of debt was hedged on average for the next seven years, with the average maturity of this hedging up to 7.3 years at end-2016 from 5.8 years one year previously. Net debt totaled 3,582 million euros at December 31, 2016, down 1,135 million euros for the year, resulting from a predominantly net seller profile in 2016. At end-2016, Gecina's LTV represented 27.7% including duties and 29.4% excluding duties, down -7.0 pts from end-2015 (36.4% excluding duties). This reduction primarily reflects the high volume of sales completed in 2016, and particularly the healthcare portfolio's sale, finalized on July 1. In addition, Gecina has 1.9 billion euros of available liquidity, making it possible to cover all its credit maturities through to 2020. Thanks to the Group’s balance sheet, Gecina has a particularly high level of financial headroom, enabling it to be extremely opportunistic, flexible and responsive on the investment market. 2.0 billion euros of sales secured or completed in 2016, with 644 million euros excluding healthcare In line with the Group's ambition to accelerate its portfolio rotation, Gecina has completed or secured nearly 2.0 billion euros of sales since the start of 2016 (excluding duties, Group share), including the sale of the Group's healthcare portfolio, which was finalized on July 1. The amount of sales completed or secured excluding the healthcare portfolio represents 644 million euros, including 483 million euros finalized with a premium of around +15% versus the latest appraisal values and an exit yield of approximately 4.2% based on expected annualized rents for 2016. Agreement to sell the healthcare portfolio for 1.35 billion euros, with a premium of around 16% Gecina finalized the sale of its healthcare portfolio to Primonial Reim on July 1, 2016. The transaction represented a total of 1.35 billion euros (including commissions and fees), with a net yield of 5.9% and a premium of around 16% versus the latest appraisal values. For reference, the value retained in the accounts at end-2015 already reflected the price agreed on with the buyer. 339 million euros of office sales completed or secured in 2016 Since January 1, 2016, the Group has completed or secured nearly 339 million euros of office sales, 319 million euros of which have already been finalized, primarily in Rueil-Malmaison, Suresnes and Neuilly. These operations show an average premium versus the end-2015 appraisals of almost 7.3%, with a loss of rental income of approximately 4.7% based on expected annualized rents for 2016. 305 million euros of residential sales completed or secured, with 189 million euros on a unit basis, achieving a premium of around 34% versus the appraisal values In 2016, Gecina completed or secured 189 million euros of vacant unit-based residential sales, with 162 million euros already completed on, achieving a premium of around 34% compared with their appraisal values, while the loss of rental income for Gecina represents 3.2%. At end-December 2016, nearly 28 million euros of sales were subject to preliminary agreements. Alongside this, Gecina has secured 113 million euros of block residential sales, also achieving a significant premium versus the latest appraisals (around 19%). Over 321 million euros of new investments secured Alongside these sales, Gecina has already secured over 321 million euros8 of new investments in assets for development or redevelopment that will be delivered in 2018 and 2019. This amount concerns the acquisition of three assets, including one off-plan in Issy-les-Moulineaux, while the other two assets - 34 rue de Guersant and 7 rue de Madrid, at the heart of Paris - are already being redeveloped or could benefit from redevelopment programs. During the first half of the year, Gecina signed an agreement with the developer PRD Office to acquire the “BE ISSY” office building off-plan, with delivery in 2018. This asset, located in Issy-les-Moulineaux, in the Southern Loop of Paris’ Western Crescent, will offer a gross leasable area of around 25,000 sq.m and 258 parking spaces. The transaction represents a total of 161 million euros including commissions and fees. Based on current market rents, Gecina expects this operation to achieve a net yield on delivery of 6.7%. At the start of the second half of 2016, Gecina also acquired a building at 34 rue Guersant (Paris 17th) for nearly 51 million euros. This building, currently occupied by CBRE under a lease that will end in 2017, is adjacent to another asset already owned by Gecina at 32 rue Guersant, which is under redevelopment. The two buildings will be able to represent a combined complex with 20,000 sq.m of space, which is rare at the heart of Paris, while potentially offering significant operational synergies. Lastly, the Group has acquired a 10,500 sq.m asset located at 7 rue de Madrid (Paris 8th), in Paris' CBD. This asset, which is currently vacant, is now being redeveloped, taking the total volume of investment up to almost 109 million euros, with a net yield on delivery of nearly 6.4%. 8 Total amount of investments secured including acquisition prices and outstanding capex through to project deliveries Buoyant project pipeline creating value over the short, medium and long term In 2016, Gecina's pipeline grew to over 3.7 billion euros, despite the delivery of the “City 2” and “Le Cristallin” buildings in Boulogne-Billancourt. More than 41% of this portfolio is made up of committed projects (1.54 billion euros), with 19% controlled and certain projects (0.70 billion euros), on which work will start up when their current tenants leave, while 40% (1.49 billion euros) is made up of projects identified within Gecina's portfolio, but when tenant departures are not yet certain. Seven new projects representing over 100,000 sq.m of offices were launched this year in Paris, Neuilly, Levallois-Perret and Issy-les-Moulineaux. In total, the pipeline for committed projects could generate up to 100 million euros of additional rental income. 1.54 billion euros of committed projects with deliveries expected primarily for 2018 The committed pipeline is up to 1.54 billion euros (versus 0.91 billion euros at end-2015), with an average yield on delivery of around 6.4% expected, offering significant value creation potential given the project locations. Half of this committed pipeline is concentrated in Paris City, with 37% in the Western Crescent (Levallois, Neuilly and Issy-les Moulineaux). The year-on-year increase in the committed pipeline (+628 million euros), despite the delivery of two buildings (City 2 and Le Cristallin), reflects the inclusion of seven new committed projects: At end-2016, 463 million euros were still to be invested on committed projects, with 276 million euros in 2017, 170 million euros in 2018 and 17 million euros in 2019. 0.70 billion euros of “controlled & certain” projects over the short or medium term, exclusively in Paris' CBD The “certain” controlled pipeline concerns the assets held by Gecina that are currently being vacated and for which a redevelopment project aligned with Gecina’s investment criteria has been identified. These projects will therefore be launched over the coming half-year or full-year periods. These “certain” projects that have not yet been committed to represent a combined total of 0.70 billion euros (versus 1.2 billion euros at end-2015). This reduction reflects the launch of redevelopment work for the “Octant-Sextant” and “20 Ville l’Evêque” buildings in the first half of the year, as well as a real estate complex in Neuilly and another two buildings in Paris during the second half of the year. The “certain” controlled pipeline is now concentrated exclusively in Paris' CBD, through projects with indicative delivery dates from 2020 to 2021. 1.49 billion euros of “controlled & likely” projects over the longer term, with 87% in Paris City The “probable” controlled pipeline covers the projects identified and owned by Gecina that may require pre-letting (for greenfield projects in peripheral locations within the Paris Region) or cases when tenant departures are not yet certain over the short term. (1) Total investment for the committed pipeline = latest appraisal value from when the project started up + total build costs. For the controlled pipeline = latest appraisal to date + operation's estimated costs (2) Includes the value of plots and existing buildings for redevelopments (3) This project, which is currently occupied, is classed as committed since the tenant's departure has been firmly agreed on for the end of the first half of the year Portfolio value up +3.8% like-for-like in 2016 The portfolio value (block) represents 12,078 million euros, up +3.8% (+4.6% on a unit value basis) like-for-like compared with December 31, 2015. This increase in value includes a very slightly positive rent effect, indicating the effective upturn on the rental market. Like-for-like, the office portfolio value is up +4.3%, reflecting a +6.4% increase in value for the Paris portfolio. The other sectors recorded lower increases, with +1.7% growth for the Western Crescent and La Défense, while the other sectors are virtually stable (Paris Inner and Outer Rim and Lyon). These appraisals reflect a 22 bp compression of capitalization rates for offices to 4.65% on a like-for-like basis since the end of 2015. The valuation retained for Gecina’s residential portfolio is up +2.2% like-for-like for the period. The average capitalization rate for Gecina’s portfolio, including the residential portfolio on a block value basis, comes to 4.60%, with an -18 bp compression over one year. NAV growth supported by the strategy and favorable market trends Diluted EPRA triple net NAV (block) came to 132.1 euros per share, with strong growth of +7.7% year-on-year. The total return performance represents nearly +12%, including the 5 euro dividend paid out in 2016. This performance reflects a compression of capitalization rates for offices in Paris in particular, and a slightly positive business plan effect, as well as the impacts of Gecina’s total return strategy, through high levels of capital gains on sales that have been completed or are underway (+1.3 euros per share), combined with the increase in the value of assets acquired recently, and the portfolio under development (+2.9 euros per share). NAV per share growth represents +9.5 euros for 2016 and can be broken down as follows: On a unit value basis, diluted EPRA NAV represented 143.6 euros per share at end-2016, compared with 133.7 euros per share at December 31, 2015, up +7.3%. Outlook for 2017 and the medium-term 2017 will be marked by Gecina's strong choices in terms of value extraction, particularly the sales of mature and non-strategic assets in 2016, as well as the launch of work to redevelop five previously occupied buildings (including three at end-2016) in order to optimize its extraction of value creation potential. In 2017, recurrent net income, restated for the impact of the healthcare sale, is expected to contract by nearly -5% to -6%9. This expected performance reflects the combined impact of underlying growth, which is expected to reach around +2% to +3%10 including the impact of sales (excluding healthcare) and the start of work to redevelop buildings from the portfolio after they have been vacated. Gecina therefore has very strong potential for growth and value extraction through its pipeline in particular, as well as positive trends for the Group's preferred sectors in terms of real estate investment. In view of this, average recurrent net income growth (CAGR) over the medium term (between 2018 and 2021) is expected to come in at around +5% to +7%11. As a result, considering the Group’s confidence in its outlook for the medium term, Gecina plans to submit a proposal at the general meeting for a dividend up +4% to 5.20 euros per share for 2016. 9 This objective may be revised up or down depending on opportunities for investments and sales during the year 10 Including the impact of sales (excluding healthcare) in 2016, deliveries of assets in 2016 and 2017, and organic growth 11 This objective may be revised up or down depending on opportunities for investments and sales Gecina owns, manages and develops property holdings worth 12.1 billion euros at end-2016, with nearly 97% located in the Paris Region. The Group is building its business around France’s leading office portfolio and a diversification division with residential assets and student residences. Gecina has put sustainable innovation at the heart of its strategy to create value, anticipate its customers' expectations and invest while respecting the environment, thanks to the dedication and expertise of its staff. Gecina is a French real estate investment trust (SIIC) listed on Euronext Paris, and is part of the SBF 120, Euronext 100, FTSE4Good, DJSI Europe and World, Stoxx Global ESG Leaders and Vigeo indices. In line with its commitments to the community, Gecina has created a company foundation, which is focused on protecting the environment and supporting all forms of disability. At the Board meeting on February 23, 2017, chaired by Bernard Michel, Gecina's Directors approved the financial statements at December 31, 2016. The audit procedures have been performed on these accounts, and the certification reports have been issued after verifying the information contained in the annual report, included in the reference document. 3- FACTORS FOR LIKE-FOR-LIKE RENTAL INCOME CHANGES IN 2016 VS 2015 Gecina's tenants operate across a very wide range of sectors responding to various macroeconomic factors. Breakdown of tenants by sector (offices - based on annualized rents): Volume of rental income by three-year break and end of leases: Gecina’s gross financial debt represented 3,640 million euros at December 31, 2016, compared with 4,863 million euros at end-2015; net financial debt came to 3,582 million euros at end-2016, down 1,135 million euros, primarily linked to sales completed during the year. The main characteristics of the debt are as follows: (1) Gross financial debt = Gross nominal debt + impact of the recognition of bonds at amortized cost + accrued interest not due + other items The following table presents the schedule for Gecina's financing facilities at December 31, 2016, including unused credit lines: All the credit maturities for the next three years are covered by the unused credit lines (2,245 million euros) at December 31, 2016. In addition, 100% of drawn debt (after factoring in undrawn credit lines) has a maturity of over three years and nearly 70% has a maturity of over five years. In line with the 2016 bond issue, the company has adapted its short-term hedging portfolio, with 23 million euros paid out. Gecina's financial position at December 31, 2016 is compliant with the various limits likely to affect the conditions for repayment or early repayment clauses in the various credit agreements. The following table presents the position for the main financial ratios covered under the agreements: The change in annualized rental income between December 31, 2015 and December 31, 2016 reflects Gecina's strategic choices. From 507 million euros (excluding healthcare) at end-2015, annualized rental income came to 479 million euros at end-2016 (down –5.4%), primarily due to the impact of sales (excluding healthcare) carried out during the year (-21 million euros, -4.1%), in addition to five assets that are now being redeveloped following their tenants’ departures (-17 million euros, -3.3%), which will have an accretive impact on Gecina’s rental and valuation aggregates. The significant changes in scope conceal a positive business plan effect (change in the vacancy rate, rental reversion on acquisitions and deliveries) of around +10 million euros, i.e. +2.0%. Annualized rental income corresponds to the effective rental position on the year-end reporting date. As such, it does not take into consideration lettings or properties vacated, or sales or acquisitions of buildings that would not have an impact by the year-end reporting date. A proposal will be submitted at the General Meeting on April 26, 2017 to approve a cash payout of 5.2 euros per share in relation to 2016. Once the dividend for 2016 has been released for payment, a 50% interim payment (2.6 euros) will be made on March 8, 2017, followed by the balance on July 7, 2017. This document does not constitute an offer to sell or a solicitation of an offer to buy Gecina securities and has not been independently verified. If you would like to obtain further information concerning Gecina, please refer to the public documents filed with the French Financial Markets Authority (Autorité des marchés financiers, AMF), which are also available on our internet site. This document may contain certain forward-looking statements. Although the Company believes that such statements are based on reasonable assumptions on the date on which this document was published, they are by their very nature subject to various risks and uncertainties which may result in differences. However, Gecina assumes no obligation and makes no commitment to update or revise such statements.
News Article | February 16, 2017
SINGAPORE--(BUSINESS WIRE)--A.M. Best has placed under review with developing implications the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Rating (Long-Term ICR) of “a-” of TOWER Insurance Limited (TIL). A.M. Best also has placed under review with developing implications the Long-Term ICR of “bbb-” of TIL’s ultimate parent, TOWER Limited (TL). Both companies are domiciled in New Zealand. The Credit Rating (rating) actions follow the announcement that TL and Fairfax Financial Holdings Limited (Fairfax) have entered into an agreement under which Fairfax will acquire 100% of TL shares at NZD 1.17 per share, for an aggregate purchase price of NZD 197 million. The ratings will remain under review until the close of the transaction, and until A.M. Best completes its discussions with the Fairfax management team. Any potential rating impact from actual or anticipated changes to TL’s and TIL’s credit profiles also will be assessed. Additionally, A.M. Best will factor its view of the extent of Fairfax’s financial support into the final rating determination. Ratings are communicated to rated entities prior to publication. Unless stated otherwise, the ratings were not amended subsequent to that communication. This press release relates to Credit Ratings that have been published on A.M. Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see A.M. Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Understanding Best’s Credit Ratings. A.M. Best is the world’s oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com. Copyright © 2017 by A.M. Best Rating Services, Inc. and/or its subsidiaries. ALL RIGHTS RESERVED.