Tag: capex

Fitch Confirms The Credit Recovery In Spain

23 April 2015 – Expansión

Over the last month, Fitch Ratings has revised upwards its growth prospects for Spain in 2015 and 2016, to 2% and 2.3%, respectively. In this context of recovery, the agency notes that “new credit growth has been more robust during the first quarter of 2015” and it expects this trend to continue for the rest of the year. Although, the pace will depend on “the strength of the economic recovery and consumer confidence”. “The banks’ healthier balance sheets and initiatives being taken by the ECB to improve liquidity, including the TLTRO (long-term auctions) should support this increased lending”.

Fitch makes these reflections upon publication of its Fitch Spanish Fundamentals index, which analyses changes in the fundamentals of credit, taking into account the key indicators of the Spanish economy: the evolution of mortgages, SMEs and securitisations, the expected EBITDA (gross operating profit) and capital expenditure (capex) of companies, ratings outlook, CDS forecasts, new credit, unemployment prospects and trends in transport. The index ranges from 1 to 10 and Spain is awarded a six, which shows that “its recovery is holding up”.

Unemployment

In terms of unemployment, another one of the key variables that Fitch uses in its new index, the agency forecasts that the rate will amount to 22.5% and 21% in 2015 and 2016, respectively. “This positive trend in employment will support domestic demand. The increase in real disposable income, together with the fall in oil prices, should also drive economic growth”. Nevertheless, in the agency’s opinion, unemployment continues to be too high and, as a counterpoint, it warns that the non-financial corporate sector is continuing to deleverage.

The agency confirmed Spain’s BBB+ rating in October last year with a stable outlook.

Original story: Expansión (by D. Badía)

Translation: Carmel Drake

Hispania Records Net Profit Of €17.5m In Its First 9 Months

25 February 2015 – Hispania Press Release

GAV as of year-end amounted to €422M, with an EPRA NAV of €555M

CBRE’s valuation has recognised capital gains in the acquired assets of €14 M, 5.5% above purchase price and 3.4% over its book value

As of 31 December 2014, €433M for investment had been committed

With the hotel investment announced earlier today (c. €368M total investment in a resort hotel REIT along with Grupo Barceló), Hispania will have invested fully the proceeds raised in its IPO and reaches committed investments for c.€800M, equivalent to 90% of its full investment firepower

Hispania Activos Inmobiliarios, S.A., (hereinafter, Hispania) closes its first year of activity with Net Profit amounting to 17.5 million euro. As of 31 December, 25 assets had been acquired, 55% in offices, 23% in residential and 22% in hotel assets.

In just 9 months, Hispania has implemented the strategy announced in its IPO and has fulfilled the commitments acquired with its investors. As of year-end, according to CBRE’s valuations, consolidated GAV amounted to 422 million euro. This implies the recognition of capital gains amounting to 14 million euro, which represent a revaluation of 5.5% on purchase prices and of 3.4% on book value.

NAV according to EPRA’s recommendations amounted to 555 million euro, implying an NAV of €10.08 per share (vs. NAV of €9.77 per share as of 30 September 2014).

It is remarkable that 76% of these acquisitions have been executed as a result of off-market negotiations with a relevant degree of complexity. This has allowed Hispania to access high-quality assets, with important repositioning possibilities and at exceptionally attractive entry prices.

Outlook for 2015

Considering the hotel investment announced today, Hispania will have committed total investments amounting to c.800 million euro in hotels (60%), offices (22%) and residential (12%). Moreover, Hispania still has an abundant pipeline of opportunities which perfectly fit the strategy and return targets of its business plan.

Regarding the assets which currently conform Hispania’s portfolio, the company foresees a relevant total capex investment of 27 million euro for its improvement and repositioning to be implemented in 2015 and a further 12 million euro over subsequent years.

“2014 has been a very fruitful year in terms of our investment activity, thanks to the abilities of the management team when it comes to identifying and executing the acquisition of assets with a clear revaluation potential, as it is already becoming evident”, highlighted Concha Osácar, Board Member of Hispania. “2015 has started with the announcement of the Barceló transaction, which will represent a total investment for Hispania of c. 368 million euro. During the rest of this year it will be equally important for Hispania to continue with an intense investment activity as to go on managing, repositioning and financing the assets which already conform our portfolio”, she added.

Original press release: Hispania

Edited by: Carmel Drake