Merlin’s Profits Soar By 1,000% After Metrovacesa Merger

2 March 2017 – Expansión

In 2016, the listed real estate investment company (Socimi) Merlin Properties managed to turn itself into one of the largest real estate companies in Europe. It also made the leap onto the selective Ibex 35, which had not featured a single company from the property sector since 2008.

And, it achieved these milestones thanks to the completion of the largest corporate transaction between real estate companies since the burst of the real estate bubble – the integration of the historical firm Metrovacesa, and that had a significant impact on its income statement for the year.

In this way, in 2016, Merlin saw its net profit soar by 1,087% to €582.6 million, thanks in large part to the contribution of Metrovacesa’s assets, which increased the value of its portfolio to €9,824 million.

In the case of revenues, the Socimi generated 362.8 million, the majority of which (€351 million) came from rental income. Last year, the contribution of rental income rose by 64% compared to 2015.

The firm’s operating profit or EBITDA amounted to €303.6 million, whilst its net debt, at the end of the year, stood at €4,471 million.

Dividend

The company, which has just appointed Francisco Javier García-Carranza Benjumea, the Deputy General Manager at Banco de Santander, as its new President, to replace Rodrigo Echenique, has announced the distribution of an extra dividend, amounting to 20 cents, which will take the remuneration per shareholder in 2016 to €0.40 per share.

Likewise, the Socimi, which owns a 16.1% stake in Testa Residencial, has said that it will increase the distribution of profits amongst its shareholders by 10% in 2017 (as a Socimi, it is obliged to distribute 80% of its profits) to 44 cents, which will involve the distribution of more than €207 million.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake

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