MERLIN Properties SOCIMI (MRL) Q1 2025 TU earnings summary

Executive summary

• First quarter delivered 2.7% rent growth, 16.9% FFO increase, and high occupancy at 96.7%, with strong organic growth and leadership in Iberian data centers.

• Gross asset value at €11.5bn, diversified across offices, logistics, shopping centers, and data centers, with a leading market position in Spain and Portugal.

• Net earnings rose 30.0% year-over-year to €84.2m, and EBITDA grew 8.9% to €102.0m.

• Dividend policy at 80% of adjusted FFO, with a final dividend of €0.40 for 2024 and similar payouts expected for 2025 and 2026.

• €37.4m in non-core asset sales completed at a double-digit premium, with €15.6m more signed for 2025.

Financial highlights

• FFO rose 16.9% year-over-year, with FFO per share down 2.6% due to increased share count.

• Gross rents increased 6.7% year-over-year to €132.5m; like-for-like organic growth at 2.7%.

• Net financial debt at €3,347m, LTV at 28.3%, and liquidity position of €2,402m.

• EPRA NTA per share at €14.47, reflecting cash flow accumulation.

• Portfolio yields above 5%, with passing yield at 4.9%.

Outlook and guidance

• Guidance for FFO is €0.59–€0.60 for the year, with current run-rate slightly above initial expectations.

• No change to guidance due to macroeconomic uncertainties; potential for outperformance if trends persist.

• Final FY24 dividend of €0.22 per share to be paid in May; dividend expected to remain stable in 2025 and 2026, with increases possible as data center cash flows ramp up from 2027.

• Focus remains on organic growth, digital infrastructure, and selective development in logistics and data centers.

• Data center market in Europe expected to grow more than 4x by 2035, with Iberia positioned as a key hub.