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Forecasts 2014
\ Management Report
RENTS
Rent forecasts include assumptions for each lease as to tenant depar-
tures, analysed on a case-by-case basis, and, in the event of tenant
departure, redecoration costs, a period of rental vacancy, rental charges
and taxes on unlet space plus agency commissions when the space is
relet. Letting forecasts are based on the current market situation, without
assuming either a possible upturn or deterioration in the market.
The property result also incorporates the writeback of lease payments
sold and discounted relating to the gradual reconstitution of the full value
of buildings of which the leases have been sold to a third party.
A 1% variation either way in the occupancy rate leads to a cumulative
increase or reduction in the net current result per share and per year of
€0.12. The ongoing contracts are indexed.
INFLATION
The inflation rate used for the evolution of rents amounts to 1.2% for the
leases being indexed in 2014. The sensitivity of the forecast to changes in
the inflation rate is low over the considered period. A 0.5% variation either
way from the predicted inflation rate leads to a cumulative increase or
reduction in the net current result per share and per year of €0.06.
FINANCIAL CHARGES
The calculation of the financial charges is based on the assumption that
interest rates will evolve as anticipated by the future rates curve, and on
the current bank and bond borrowings. Considering the hedging instru-
ments in place, the estimated cost of debt in 2014 is 3.82% (margins
included).
CONSOLIDATED INCOME STATEMENT
Given the uncertainty of a forward projection of the future market values
of the properties, no reliable assessed forecast can be provided for the
unrealised result on the portfolio.
This result will depend on trends in the rental market, capitalisation rates
as well as anticipated renovation costs of buildings.
Changes in shareholders’ equity will depend on the current result, the
result on the portfolio and the dividend distribution.
The shareholders’ equity is presented before distribution of the dividends
for the financial year.
NET CURRENT RESULT PER SHARE
Based on the current expectations and in the absence of major unfore-
seen events, the company has set an objective for its net current result
– Group share (excluding IAS 39 impact) of €6.61 per share for the finan-
cial year 2014, a 2.5% decrease compared to the financial year 2013
(€6.78). The net current result (excluding IAS 39 impact) forecasted for
2014 amounts to €118,9 million, which is in line with the net current result
(excluding IAS 39 impact) of 2013 of €119.2 million. The decrease of the
net current result (excluding IAS 39 impact) per share is mainly the result
of the increase of the number of ordinary shares in 2014 following the
assumption that 30% of the total dividend will be distributed in the form of
new shares. Considering these assumtions, the forecasted Loan-to-value
ratio at 31.12.2014 is below 50%.
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