Event in Progress:
Discover the latest content that has just been published on Research Tree
Icade experienced rising further vacancy in Offices sequentially. In residential development, the cancellation rate accelerated in Q2 22 alone. Guidance was confirmed, nevertheless.
Companies: Icade (ICAD:EPA)Icade SA (ICAD:PAR)
In Offices, the pressure was concrete with a negative performance lfl. Rising construction costs in Icade’s development business will question French residential units’ affordability in 2023.
Yield compression in Healthcare has offset the impact of rising vacancy in Offices. The recovery recorded in Residential Development is about to stabilise in FY 22. The company’s guidance of +4% in FFO in FY 22 (before accounting for another tranche of disposals) doesn’t push to strong optimism.
Following stabilisation in Q2 21, vacancy was up 130bps sequentially in French Offices. Guidance unchanged. Nothing more about the Icade Santé IPO.
No major surprise in Q2 21 in the Property business: vacancy stands at a high level but was roughly flat sequentially. Reservations in the Residential Development business were flat sequentially too: strong lfl growth in H1 21 can therefore not be extrapolated to H2 21-2022. A negative base effect could occur in H1 22, in our view.
Q1 21 revenue was up 43% lfl with a negative contribution from the Property segment. Residential development was up 128% (lfl, IFRS) pushed by apartments delivered to the French Government arm (CDCH).
Much as Covivio and Gecina did earlier, Icade released a reassuring picture at pixel time (December 2020) as far as offices were concerned. It experienced some little negative revaluations too, but the balance sheet stays under control. It will pay a stable cash dividend of €4.01 per share.
As per Gecina, Icade’s vacancy was more or less stable on a sequential basis in Q3 20. The most interesting figure was the decreasing number of residential reservations in Q3 20, ahead of the contribution from the CDCH (French government). This reflects lower confidence from both individual investors and first-time individual buyers.
Companies: Icade SA
NNNAV was stable in H1 20 as valuers consider that the crisis doesn’t impact offices until now. It’s a fact that due to this specific business’s inertia, both vacancy and pressure on rents will not increase before H1 21, in our view.
We believe in a strong adjustment in Office values in FY 20-22. It could end in putting the balance sheet at risk. Having been negative during the last rush phase upto February 2020, we are now back to a negative stance after the share’s recent bounce. Just remember that 2009-10 resulted in a c. 25% adjustment in Icade’s GAV (Offices, lfl). Why should it be only 5-10% this time?
Following Covivio, Gecina, SFL… Icade reported a nice set of FY 19 figures. Positive revaluations slowed in the City of Paris in H2 19 (1.3% vs. 3.1% in H1 19) despite the acceleration in the heart of the City in H2 19. The surprise came from assets outside the Paris Region, showing a 19% lfl increase in H2 19 vs. 1% in H1 19. Following the share price’s rally, we stick to our negative stance.
Icade qualified its leasing activity as “resilient” in 9M 19 vs. “solid” in H1 19, or a change in its wording in our view. In fact, we observed a lfl decrease in rents in Q3 19. This leads us to become more cautious, aside our questions concerning the French Offices end-market around the City of Paris for some months.
There were some positive revaluations in H1 19 and rents increased slightly at constant perimeter. Both were slightly above the rents indexation, suggesting a very limited yield compression in H1 19, or some negative ones in some asset pockets. We continue to point out the weaker end-market around Paris (excluding the City of Paris) where Icade’s buildings are mainly located.
Icade’s rental business performed well in Q1 19 thanks a nice 2% inflation (indexation). However, the Residential and Office backlogs were down by respectively 8% and 47% yoy, or +5% and -5% vs. 31 December.
The most important figure for FY 18, not only for ICADE but for other players too, is the 22% drop in Development business backlog: -8% in houses business, -55% in Office business.
Research Tree provides access to ongoing research coverage, media content and regulatory news on Icade SA.
We currently have 0 research reports from 2
The group posted a strong set of results showing faster and stronger-than-expected net interest margin expansion and no signs of a deterioration and above all anxiety on the asset quality front. It remains to be seen if the UK government will allow banks to hold on to the benefit of interest rate increases and if the UK economy proves as resilient as expected.
Companies: Lloyds Banking Group plc
Legal & General disclosed strong HY 22 results, albeit in line with the consensus’ expectations. With most of the metrics improving on a yoy and sequential basis, we believe that the strong solvency position, in an environment with (sustainable?) higher yields, should trigger capital distributions to shareholders at the year-end.
Companies: Legal & General Group Plc
Aviva unveiled a fair operating result. While, in line with the insurance industry, Aviva saw a strongly negative impact from financial assets revaluation, the solvency position improved materially, yielding additional capital distributions. Once distributions cease, we believe that Aviva could be a takeover target.
Companies: Aviva plc
Last week, the UK government published the consultation paper on its Review of Electricity Market Arrangements (REMA). Any change potentially represents uncertainty in a market that has been wary of changes with a number of shares falling after early details of possible reforms were flagged in the press. We review the possible changes and conclude that while there is some risk, from what we can see at present the likely outcomes could be either minimal or beneficial for investors in clean energy
Companies: EQT IES DRX NESF PHE SAE
Cenkos:Duke Royalty Ltd -Record revenues keep on rolling
Companies: Duke Royalty Limited
Companies: H&T Group plc
Dish of the day
No joiners today.
Leavers: No leavers today.
What’s cooking in the IPO kitchen?**
Unigel Group, intends to join the Aquis Growth Market. Unigel Group is a pioneer in the field of thixotropic gels for the fibre optic cable industry. The Company is also a supplier of laminated steel tapes to the fibre optic cable industry in the US. Thixotropic gels and laminated steel tapes are essential components to the rapidly growing global fibre optic cable market. The Group exports
Companies: UJO FAB HAT HZM SYM TRAC
Dish of the day
No joiners today.
No leavers today.
What’s cooking in the IPO kitchen?
Unigel Group, intends to join the Aquis Growth Market. Unigel Group is a pioneer in the field of thixotropic gels for the fibre optic cable industry. The Company is also a supplier of laminated steel tapes to the fibre optic cable industry in the US. Thixotropic gels and laminated steel tapes are essential components to the rapidly growing global fibre optic cable market. The Group export
Companies: SDI FUL PURP OSI IXI BSE BRSD ATM
Great results posted by M&G, which recorded very resilient AUMs. The firm managed to outperform the consensus despite the tough environment. While the management avoided any capital plans comments, the resilient solvency position leaves great prospects while the current share buyback is still far from being completed.
Companies: M&G Plc
This quarter’s key observations
• Subsector performance: Marketplaces was by far the best performing subsector from an aggregate share price perspective (up 19.9%) vs. an average –5.2% for the other five subsectors. UK Digital Media was the worst performing subsector with a -12.4% aggregate share price move.
• Valuation trends: UK Managed Services saw the largest EV/ EBITDA derating (-2.1x) and is now on the lowest EV/Sales multiple (1.5x FY1) and second lowest average EV/EBITDA (11.3x FY1
Companies: CNIC BIG DEVO LBG OTMP SYS
NESF has boosted its effective electricity price hedging with the winning of 86W under the UK’s CfD renewable support scheme. This provides an index-linked 15-year income stream providing a strong underpinning to the fund’s earnings.
Companies: NextEnergy Solar Fund Ltd
Companies: Belvoir Group PLC (BLV:LON)SDI Group plc (SDI:LON)
Purplebricks full year results provides the detail behind its May pre-close update (i.e. 40,141 instructions; £70m revenue; £8.8m EBITDA loss and £43.2m cash) and details Purplebricks’ plan to return to operational cash generation.
Companies: Purplebricks Group Plc
We initiate full coverage on Alkemy Capital Investments plc (Alkemy). Alkemy’s 100%-owned subsidiary Tees Valley Lithium (TVL) is developing a world-class, low carbon, lithium hydroxide (LHM or LiOH) refining facility at the Wilton International Chemical Park in the Teesside Freeport, UK. Vying to be the first of its kind in the UK, the plant will process a variety of lithium feedstocks to produce a low-carbon footprint, battery-grade lithium hydroxide product suitable to supply the rapidly expa
Companies: Alkemy Capital Investments Plc