Deutsche EuroShop (DEQ) Q2 2024 earnings summary

Executive summary

• Revenue declined by 1.9% year-over-year to €132.8 million due to temporary vacancies from ongoing investments, but visitor numbers and tenant sales increased by 1.0% and 1.9%, respectively.

• EBIT rose 7.0% to €107.4 million, and EBT (excluding measurement gains/losses) increased 5.6% to €82.1 million, reflecting improved operational efficiency.

• Consolidated profit surged 60.5% year-over-year to €59.5 million, mainly due to a lower measurement loss compared to the prior year.

• EPRA earnings and FFO declined by 8.0% and 9.7%, respectively, due to one-off income in the previous year.

• Dividend proposal for 2023 increased to €2.60 per share, reflecting strong liquidity and successful loan agreements.

Financial highlights

• Revenue: €132.8 million (down 1.9% year-over-year); NOI: €106.4 million (down 1.0%).

• EBIT: €107.4 million (up 7.0%); EBT (excl. measurement gains/losses): €82.1 million (up 5.6%).

• EPRA earnings: €80.6 million (down 8.0%); FFO: €79.0 million (down 9.7%).

• Consolidated profit: €59.5 million (up 60.5%); EPS: €0.78 (up from €0.50 year-over-year).

• Cash and cash equivalents: €338.6 million, up slightly despite a €149.1 million dividend payout.

Outlook and guidance

• 2024 revenue forecast: €268–274 million; EBIT: €204–210 million; EBT (excl. measurement gains/losses): €149–155 million; FFO: €146–152 million.

• Economic recovery in Germany expected to be moderate, with GDP growth of 0.2% in 2024 and 1.1% in 2025.

• Inflation projected to decline to 2.2% in 2024; further ECB rate cuts anticipated.

• Dividend of €2.60 per share proposed for 2023, up from the initially planned €0.80.