IGD SiiQ

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Glossary

  • Agency Management

    Activities aimed at finding the most profitable tenant mix and negotiating leases for stores at malls.

     

    Development pipeline

    Program of investments in development.

     

    EPRA

    European Public Real Estate Association.

     

    ERV/Estimated rental value

    The estimated value at market rates for rentable spaces, according to an independent appraisal based on similar properties in comparable areas.

     

    Facility Management

    Supply of specialized services to shopping centers such as security, cleaning and routine maintenance.

     

    GLA

    Gross leasable area.

     

    Gross floor area

    Surface area of a property including external walls.

     

    Hypermarket

    Property with a sales floor in excess of 2,500m², used for the retail sale of food and non-food products.

     

    IPD

    Investment Property Databank. An index which produces an independent benchmark for real estate investment returns.

     

    Mall/Shopping Mall

    Property comprised of many stores plus the common spaces around which they are situated. Usually called a "Galleria" in Italian.

     

    Midsize store

    A property with a sales floor of 250 to 2,500m² used for the retail sale of non-food consumer goods.

     

    Net area

    Surface area of real estate not including external walls.

     

    Occupancy rate

    Gross let surface area expressed as a percentage of properties' total surface area.

     

    Operators committee

    Committee made up of retailers operating inside the shopping centre.

     

    Over-rented

    Space rented for an amount exceeding its ERV.

     

    Pre-let

    Lease signed by a tenant before development of the property has been completed.

     

    Real estate portfolio

    The portfolio of freehold and leasehold properties rented out by the IGD Group.

     

    REIT

    Real Estate Investment Trust, comparable to a SIIQ in Italy.

     

    Retail Park

    Goup of three or more complexes with a combined area of more than 4,500 mq and shared parking.

     

    Shopping center

    Real estate complex comprised of a hypermarket and a shopping mall, featuring common areas and services located in a covered area with heating and air conditioning.

     

    SIIQ

    Società di Investimento Immobiliare Quotata, Real estate investment model comparable to a REIT. SIIQ rules allow income tax exemptions for publicly held listed companies whose prevalent activity is the rental of properties and the equivalent, provided they meet a series of earnings and balance sheet requirements.

     

    Store

    Property for the retail sale of non-food consumer goods.

     

    Supermarket

    A property with a sales floor of 250 to 2,500m², used for the retail sale of food and non-food products.

     

    Tenant mix

    Set of store operators and brands found within a mall.

     

    Under-rented

    Space rented for an amount less than its ERV.

     
  • Direct costs

    Costs directly attributable to the shopping centers.

     

    Dividend yield

    The dividend yield, or price/dividend ratio, on a company stock is the company's annual dividend payments made or announced dividend by closing price of its ordinary shares at the end of the year.

     

    EBIT (Operating profit)

    EBIT, or Earnings before Interest and Taxes, differs from EBITDA in that it includes information on amortization, depreciation and changes in the fair value of properties held. In the case of IGD, which follows International Accounting Standards (IAS), amortization and depreciation are not overly significant as the value of the freehold properties is updated every six months, based on independent appraisals; properties are recognized at market value in the balance sheet, while the difference in fair value portfolio is shown in the income statement between EBITDA and EBIT.

     

    EBITDA

    EBITDA or Earnings before Interest, Taxes, Depreciation & Amortization, is the most significant measure of a company's operating performance as it indicates earnings regardless of the company's means of financing, taxes or investment cycle. EBITDA is a proxy for the operating cash flow that the company is capable of generating.

     

    EPS/Earnings per share

    Net profit dividend by the average number of shares outstanding in the year.

     

    FFO/Funds from Operations

    Net profit plus deferred taxes, depreciation & amortization, net change in the market value of properties and writedowns. This is the indicator most commonly used to evaluate a REIT's performance.

     

    Gross margin

    The result obtained by subtracting direct costs from revenues.

     

    Hedging level

    The percentage ratio between the amount of bank loans and bonds covered by IRS (Interest Rate Swaps) and total bank loans and bonds.

     

    IRS/Interest Rate Swaps

    Financial instrument whereby two parties agree to exchange a certain interest rate stream on a pre-established date. Used to convert floating rate debt into fixed rate debt.

     

    Initial yield

    The annualized rental income from a property as a percentage of its valuation at the time of purchase.

     

    Joint venture

    Entity controlled on a long-term basis by two or more parties, based on a contractual agreement which calls for decisions regarding the management and financing of the enterprise to be made jointly.

     

    Like-for-like portfolio

    Real estate assets held in the portfolio for the entire year and the entire prior year.

     

    LTV/Loan to Value

    Ratio between the amount borrowed and the fair market value of freehold properties.

     

    Market value (Fair value)

    The estimated amount for which a property could be exchanged as of the valuation date, between a buyer and seller each acting prudently and with knowledge of all the facts. The definition of market value used by the appraiser is as follows: "Pursuant to the 6th and latest edition of the "RICS Appraisal and Valuation Manual" (the "Red Book") publishe dby the Royal Institution of Chartered Surveyors in the United Kingdom and translated into Italian on 1st January 2008, market value is the estimated amount for which a property could be bought and sold on the dtae of valuation between a willing buyer and a willing seller in an arms-length transaction after proper marketing wherein the parties have each acted knowledgeably, prudently and without compulsion".

     

    NAV/Net Asset Value

    Difference between the value of properties (Asset Value) and net debt. The NAV per share indicated in IGD's financial statements is the Triple Net Asset Value (£NAV), wchich is expressed net of latent capital gains and the tax effect. In the calculation, potential capital gains on freehold property are added to net equity. The tax effect, based on the company's tax rate, is then deducted from this result. This Net NAV (NNAV) figure is then divided by the number of shares issued.

     

    Reversionary potential yield

    The net annual rent that a property would generate if it were fully let at going market rates, as a percentage of the property's value.

     

    ROACE/Return on Average Capital Employed

    Operating income dividend by average capital employed in the year.

     

    ROE/Return on Equity

    Net profit dividend by net equity after dividends.

     

    Shared costs

    Corporate costs not attributable to the individual shopping center.

     

    WACC/Weighted Average Cost of Capital

    The weighted average cost of debt and all other sources of capital, used to calculate the expected return on investments.

     
  • Capitalization

    Stock market value of a listed company obtained multiplying the stock price by the number of outstanding shares.

     

    Capital Gain

    It expresses the return on equity investment in terms of price change, as percentage ratio between price at the time of purchase and current price. In the event the change in a specific period reflects a negative return, we speak of Capital Loss.

     

    Dividend yield

    Indicator which expresses the return on equity investment related to profits distribution as percentage ratio between the dividend for the year and the stock price at the end of the year.

     

    Ordinary dividend

    Once a year, after the Annual Shareholders' Meeting, the Company distributes part of the earnings as dividends to its shareholders. In the case of SIIQ companies, the dividends must be at least 85% of the profit achieved in free management, which is that covered by SIIQ perimeter.

     

    Total Shareholder Return/TSR

    It expresses the overall return on equity investment, as a measure of change price (Capital Gain) in the priod, to which distributed dividends and reinvested dividends in the stock on the date of the coupon (dividend yield) are added. The TSR is therefore represented by the sum of Capital Gain and Dividend Yield.

     

    Treasury shares

    Shares purchased by the Company.

     
 
 
 
 
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