MERLIN Properties SOCIMI (MRL) H2 2024 earnings summary

Executive summary

• Achieved record occupancy of 96.7% (+58 bps YoY) across the portfolio, with like-for-like rental growth of 3.4% and strong operational momentum in 2024.

• Offices, logistics, and shopping centers all delivered positive rental growth and high occupancy, with logistics at 99.4% and shopping centers reporting a historic low occupancy cost ratio of 11.2%.

• Data center division expanded significantly: 26 MW operational, 38 MW equipped, 200+ MW under construction, and 2 GW+ pipeline, with Phase I fully equipped and Phase II underway, supported by a €921m capital increase.

• Financial position strengthened by capital increase and upgrades from Moody's and S&P (BBB+/Baa1), with LTV at 28.3% and no major debt maturities until November 2026.

• Total Shareholder Return was -2.3% YoY, mainly due to capital increase; valuations stable despite 21 bps yield expansion.

Financial highlights

• Gross rents increased 5.2% YoY to €500.4m, with net rents at €418.1m and total revenue at €516.7m (+5.8% YoY).

• FFO per share was €0.55 (-8.9% YoY), with FFO up 9.4% YoY to €310.8m; AFFO per share €0.52 (+10.6% YoY), reflecting share dilution.

• EPRA NTA per share decreased to €14.32 (-5.0% YoY), mainly due to dilution and dividend.

• Net income was €283.8m, reversing a prior year loss of €83.5m.

• Net debt to EBITDA at 8.8x, with net debt at €3,347m and gross debt at €4.9bn.

Outlook and guidance

• 2025 FFO guidance is flat at around €0.54 per share, reflecting higher financial costs and limited incremental occupancy gains.

• Data center division expected to remain a negative cash flow contributor until 2027, with meaningful income of €25m budgeted for 2025.

• Dividend proposal for 2024: €0.40 per share (with €0.18 already paid), maintaining an 80% payout policy.

• 2026 expected to be only slightly positive versus 2025, as higher debt costs and ongoing data center investments weigh on earnings.