Eurocommercial Properties: Sales Up by 4.9%, IFRS EPS Rises to €0.70
Eurocommercial Properties announced this Wednesday its first-quarter 2026 results, marked by an increase in customer sales and traffic in its shopping centers. However, the direct investment result per share remains stable at €0.62 (IFRS EPS at €0.70), identical to the same period last year, despite improved operational profitability.
Increased Traffic and Sales, Rents Trending Upwards
The portfolio of shopping centers shows positive business dynamics in the first quarter. Foot traffic increased by 3.8% over three months, while retail sales rose by 4.9% compared to Q1 2025. This growth extends over the past twelve months, with a sales increase of 4.5%. Like-for-like rental growth stands at 2.1% for the year, driven particularly by Italy where rents increased by 5.3%. Out of the 310 renewal and relocation transactions over twelve months, the average uplift reached 4.2%, with a 6.4% uplift on new leases. Relocation activities generate particularly high uplifts, especially in sector changes (12.9% on average). Rent collection reached 99% in the first quarter, and the EPRA vacancy rate is limited to 1.5%, among the lowest in the sector. The occupancy cost ratio fell to 9.2% from 10.0% the previous year, reflecting the increase in sales.
Shareholder Value Creation Stagnant Despite Revenue Improvement
The direct investment result per share remains unchanged at €0.62 in Q1 2026, identical to the same period in 2025. The IFRS result after tax rose to €37.9 million, up from €35.6 million a year earlier. Net property income reached €51.7 million, up from €50.5 million, supported particularly by a €1.4 million increase in rental income linked to indexing, renewals, and relocations. This stability in the result per share occurs despite a 1.8% increase in the average number of shares in circulation, rising from 53.7 million to 54.6 million. The acquisition of Avion Shopping Centre in Sweden (45,000 sqm for €108 million, finalized on April 16, 2026) contributes to the results from April, benefiting from a BREEAM Excellent certification and anchored by IKEA. The IFRS result progresses to €37.9 million (€0.70 per share) thanks to revaluation movements of derivatives for €4.7 million, but this movement is not reflected in the direct investment result, the measure retained by management to assess underlying profitability.
Outlook Confirmed Despite Geopolitical Uncertainties
Management confirms its expectation for the direct investment result for 2026 to be between €2.45 and €2.50 per share, subject to no major deterioration in the macroeconomic and geopolitical environment. The net debt to value ratio stands at 40.1% (compared to 39.8% at the end of 2025), slightly up following an increase in net borrowings and the payment of an interim dividend of €31.7 million in January 2026. Eurocommercial completed the drawdown of €525 million of long-term financing related to the refinancing of Carosello and I Gigli in Italy, as well as C4 in Sweden, finalized in the first part of the year. The net debt portfolio is covered at 84% as of March 31, 2026. The average duration of active swaps stands at 4 years, while the average borrowing rate remains stable at 3.2%. Management proposes a total dividend of €1.83 per share for 2025, an increase from the €1.80 paid the previous year, with a final dividend of €1.11 payable on July 2, 2026.
