Cash generation grows 14.2% and net income rises 5.9% to R$104.5 mi in the 2nd quarter

Multiplan disclosed on Thursday its earnings results for the second quarter of 2017. The net income reflected a strong quarter, growing 5.9% to R$ 104.5 million and the Operating Cash Flow (FFO) registered growth of 14.2%, reaching R$ 160.4 million, an increase  in the margin of 452 b.p., which reached 56.6%.

Same Store Sales (SSS) grew 6.7% in the period, while total sales evolved 8.7%, with six shopping malls registering double-digit growth: ParkShoppingCampoGrande, in Rio de Janeiro, grew 26.3%, BarraShopping in Rio, 16.3%; ParkShoppingBarigüi, in Curitiba, 11.7%; JundiaíShopping, in São Paulo, higher by 11.3%; Shopping Anália Franco, also in São Paulo, grew 10.9%; and in Brasília, ParkShopping rose 10.8%.

Same Store Rent (SSR) increased 8.6%, in real terms, driving rental revenue growth to 13.2%. Net delinquency was reduced from 2.4% in the second quarter of 2016 to 1.3% in the current quarter.

The occupancy rate, which has remained high, rose even more in the quarter, ending at 97.7% in the period, surpassing the previous quarter and year. The Company's first ten shopping centers presented a high occupancy rate in the second quarter of 2017, of 98.4%, once again demonstrating the operational resilience of the portfolio.

The Net Operating Income (NOI), which benefited from the decline in expenses with properties, grew 13.9% with a margin increase of 156 b.p., to 88.6% for 2Q17. EBITDA was up 8.7% and reached R$ 212.3 million, and also presented a better margin, at 74.9%.

The net debt/EBITDA ratio remained stable at 2.40x in June 2017. The issuance of new Certificates of Real Estate Receivables (CRIs) in the amount of R$ 300.0 million with a maturity of six years and 95% of the CDI, and the prepayment of a loan at a cost of 108% of the CDI, due in 2019, contributed to the reduction of the average cost of debt, in addition to extending the average amortization period.

In August, ParkShopping Canoas will formally deliver store keys at an event, allowing the shopkeepers to begin building their spaces and get ready for the opening in November 2017. Currently, 88.4% of the Gross Leasable Area (GLA) has been let.

The company also officially announced, on the 26th of this month, the first VillageMall expansion. It will boost the shopping center's GLA by 11% through the addition of 34 new operations. The first phase will open in November this year, and the second in May 2018.