Sonae Sierra, the international shopping center specialist, presented a Net Profit of 13.2 million in the first half of 2011, which compares with 648,000 in the same period of 2010.
The positive variation of the Net Profit was leveraged by a 1% increase of the Direct Net Profit, and a 44% improvement of the Indirect Net Profit, consequence of the resilience and increased operational efficiency of our assets, which minimized the effects of the negative behavior of the yields in Portugal and Greece.
During the second quarter, we highlight as the main event the beginning of the construction of a new shopping center in Solingen, Germany, which represents an investment of approximately 120 million. For the development of this new project, Sonae Sierra established a 50/50 joint-venture with MAB Development.
We have also reinforced and increased the service provision to third parties, with the signing of two service contracts for the leasing of Sun Plaza and Vivantis Mall shopping centers, in Romania. In Spain, Sonae Sierra strengthened its presence with the signing of a contract for leasing Carcaixent Retail Park. In Italy, the company took over the property management of shopping center Le Isole, located in Piemonte.
The capital recycling strategy adopted by the company resulted in a decrease in Investment Properties, compared to 2010, due to the sale of two centers in Spain (El Rosal and Plaza Eboli) and the IPO of Sonae Sierra Brasil. This strategy had already been implemented in 2010, with the sale of Alexa (Germany) and Mediterranean Cosmos (Greece).
Portfolio under development
Currently, Sonae Sierra has 49 shopping centers in operation, 28 of which are located outside Portugal, namely in Spain (9), Italy (4), Greece (1), Germany (3), Romania (1) and Brazil (10).
Sonae Sierra's international growth is also focused in the provision of development and management services to third parties, as a result of the company's unique knowledge of the shopping center business. The company is already active in this area in Cyprus, Serbia, Morocco and Colombia, besides the markets where it owns assets.
The company has four shopping centers under construction, representing a total investment of about 400 million: Solingen Shopping in Germany, Le Terrazze in Italy, and Uberlândia Shopping and Boulevard Londrina, both in Brazil. Seven other projects are in different stages of development in Portugal, Italy, Germany, Greece, Romania and Brazil.
Solingen Shopping, which began being built this summer, will have a GLA of 28,000 m² and is scheduled to open in late 2013/early 2014.
In Italy, Le Terrazze is under construction, with a total GLA of 38,500 m² and an investment of more than 125 million. It is scheduled to be inaugurated in the first quarter of 2012.
In Brazil Uberlândia Shopping, scheduled to be inaugurated in the first quarter 2012, will have a GLA of 43,600 m² and represents an investment of 62 million. Boulevard Londrina will have a GLA of 47,800 m², which corresponds to an investment of 88 million, and is scheduled to open in 2012. There are also two expansions under way in Brazil: Shopping Metropole and Shopping Campo Limpo.
Source: Sonae Sierra