Klepierre first quarter 2004 revenues up 11%

Klépierre’s revenues for the first quarter of 2004 were €102.3 million, an 11.0% increase over the corresponding prior period that reflected both the vitality of shopping centers in spite of relatively sluggish consumer spending and the wisdom of Klépierre’s positioning in several Continental European markets.

Contrasting trends in European conusmption patterns
In France, where INSEE estimates that GDP growth will not reach 2% for the first quarter of 2004, small retailers (excluding automobile) reported sales growth of 0.5%. Over the same period, Klépierre’s shopping center retailers reported revenue growth of 1.1%. First quarter business activity was driven by robust performance from downtown
shopping malls (+6.1%). Inter-municipal malls reported more moderate growth (+1.3%), while revenue growth for regional shopping centers was flat. Health/Beauty (+6.6%) and Culture/Entertainment (+3.1%) retailers continued to lead sales growth, while Personal products pursued its downward path (-1.2%). Spain remains the most buoyant market, reporting 6.7% revenue growth for the first two months of the year. Personal product sales tapered off, however, rising by a modest 1.9%. In Italy, revenues declined by 1.6% over the first two months of the year. The Health/Beauty segment turned in a satisfactory performance, while Personal product retailers showed resilience. Revenues from Restaurant businesses declined.

Shopping center lease income up 19.6%
Shopping center lease income grew by 19.6% compared with the corresponding prior period, reaching €77.4 million. The increase reflects the full-year impact of acquisitions that were mostly completed in last quarter 2003 (15.2%). These acquisitions contributed €12.2 million to the quarter rents, broken down as follows:

  • €3.1 million in Spain, for 10 acquisitions
  • €2.5 million in Italy, for five shopping centers acquired
  • €2.3 million in the Czech Republic, with the Novy Smichov acquisition
  • €2 million in Portugal, of which €1.6 million from the Gondomar center in Porto
  • €1.8 million in France, for three centers acquired at year-end 2003.


The September 2003 exit of minority interest in Klécentres led to changes in consolidation that resulted in a loss of €1.6 million in lease income, total share. The restructuring had virtually no impact on Group share. Calculated on a constant portfolio basis, shopping center rents grew by 4.4% (€2.8 million), reflecting:
  • The impact of index-linked rent adjustments, which generated a 2.8% increase in shopping center rents
  • The impact of renewals/changes in tenant mix, undertaken in 2003 (750 leases) and continued in 2004 (268 leases at the March 31, 2004 reporting date, these initiatives generated an average increase of 23.9% for renewals and 13.1% for changes in tenant mix.)


Variable rents contributed €2.2 million of the quarter’s total lease income, 4% for French rents (stable versus 2003) and 1.6% for Italian rents. The financial occupancy rate remained high (97.9% at the March 31, 2004 reporting date). Properties located outside France now provide 33.2% of total lease income, versus 23.5% at the end of Q1 2003. If shopping center properties alone are taken into account, the percentage is 40.4% of lease income (versus 30.6%). Spain is the leading foreign contributor, with €12.6 million, followed closely by Italy, with €11.6 million. Respectively, they now account for 16% and 15% of shopping center rents.

Office property rents up 2.8% on a constant basis
Office properties generated total rents of €16.7 million. On a constant portfolio basis, rents increased by 2.8%. Fourteen leases were renewed in the first quarter of the year, generating an average increase in rents of 1.5%, and a full-year rental gain of €0.7 million. The financial occupancy rate fell from 97.3% at year-end 2003 to 93%, due to tenant departures (in Levallois-Perret, Boulogne-Billancourt and Paris 17th). For Klépierre, this change, which is in line with prevailing market tre

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