SFL presents 2004 Results (FR)

On January 31, 2005 Société Foncière Lyonnaise (SFL) has presented its 2004 Results. The highlights are:

  • Rental revenues up 5.7% to €154.8m â€" Current cash flow up 16.4% to €100m
  • Net profit up 79.3% to €98.4m
  • NAV per share (net of transfer costs) up 4.8% to €39.2 at 31 December 2004

Business Review
Property portfolio: taking advantage of the SIIC tax regime, SFL stepped up the asset turnover rate. With no shortage of opportunities in an active market, SFL invested €529.4 million in new properties (Ilot Richelieu, Rives de Seine, Michelet la Défense and 108-110 Bd Haussmann) and sold €244.8 million worth of properties out of the portfolio (including Ilot François 1er, 77 av. des Champs Elysées, 17-19 avenue Montaigne, 16-18 rue Chalgrin and 7 rue du Cirque). SFL also redeemed the €275 million mandatory convertible bond held by Prédica, leading to the exclusion of the Village Victor Hugo properties from the consolidated financial statements as from 1 January 2004. After these transactions, at 31 December 2004 the portfolio totalled €2,406 million (net of transfer costs), an increase of 8.1% over the yearearlier figure.

Turnover: rental revenues rose by 5.7% to €154.8 million. The like-for-like increase of 4.1% was more than the rise in the building cost index, testifying to the quality of SFL´s strategic positioning. Sales as a property trader fell to €20 million from €67.8 million, reflecting the fact that the programmes were nearing completion, while service revenues held firm at €2.3 million. Total turnover was down by 18.2% to €177.1 million, entirely as a result of the lower sales as a property trader.

Operating profit before interest held firm at €107.0 million compared with €107.9 million in 2003, despite the lower contribution from sales as a property trader. The conversion in October 2004 of the 1997 convertible bonds led to the reversal of the €24 million provision set aside to cover redemption premiums on the bonds. This provision reversal helped to drive up operating profit after interest by a very strong 74.9% to €93.4 million.

Current cash flow rose by 16.4% to €100 million from €85.9 million, representing the fourth consecutive year of growth.

Net profit reached a record high of €98.4 million, an increase of 79.3% million over 2003.

Higher asset values and NAV
The appraisal value of the property portfolio, net of transfer costs, totalled €2,406 million at 31 December 2004, an increase of 8.1% over the year-earlier figure of €2,227 million. On a like-for-like basis, the value of the portfolio rose by 5.1%, testifying to the quality of our positioning in the Paris Central Business District â€" CBD â€" office and retail property market.

The occupancy rate remained at an exceptionally high 98.2% of useable surface areas. The rate for SFL´s portfolio of office properties was 98.3%, only just below the 94.4% rate for the Paris CBD office market as a whole.

Liabilities: net debt contracted to €663.5 million from €742.9 million.
The 10.7% decrease was due to debt restructuring operations, including redemption of the Prédica mandatory convertible bond and conversion of the 1997 convertible bonds. The Loan-to-Value ratio (including transfer costs) fell to 24.9% from 30.4%, giving us considerable scope to take on more debt.

NAV (net of transfer costs) at 31 December 2004 amounted to €39.2 per share, an increase of 4.8% compared with €37.4 per share one year earlier.

NAV (net of transfer costs) per share before the interim dividend of €0.70 per share paid on 10 December 2004 came to €39.9 per share, representing an increase of 6.7% over 12 months.

Diluted NAV (net of transfer costs) after tax and mark-to-market adjustments to hedging instruments amounted to €37.9 per share at 31 December 2004 (€41.0 per share including transfer costs)

Outlook: a group and a balance sheet structured for growth
At the Annual General Meeting on 21 April 2005, the Board of Directors will recommend increasing the

Related News