VGP (VGP) H1 2024 earnings summary

Executive summary

• Pre-tax profit reached EUR 154.6 million, up 218% year-over-year, with net profit at EUR 141.5 million, a 308% increase, driven by rental and renewable income, management fees, and valuation gains.

• Signed and renewed lease agreements totaled EUR 45.6 million, with record EUR 28.8 million in new leases, bringing annualized rental income to EUR 384.7 million (+17.3% YoY).

• Portfolio occupancy remains above 99%, with a weighted average lease term of 7.8 years.

• Land bank stands at 8.5 million sq m, supporting a development potential of 3.7–4 million sq m.

• Cash position is strong at EUR 625 million, with EUR 400 million in undrawn credit facilities and gearing ratio reduced to 32.7%.

Financial highlights

• Net rental and renewable energy income grew 20.2% year-over-year, reaching EUR 91.6 million on a look-through basis.

• Gross renewables income increased 31% to EUR 3.8 million, with operational solar capacity up 115% YoY to 143.3 MWp.

• EBITDA rose 60% to EUR 182 million, with all business segments contributing.

• Gearing ratio reduced from 40.3% to 32.7%; proportional LTV dropped from 53% to 48.6%.

• Average cost of debt decreased to 2.21% after bond repayments.

Outlook and guidance

• Management expects contracted annualized rental income to exceed EUR 400 million by year-end.

• Planned deliveries for 2024 are 600,000–700,000 sq m, with a normalized annual run rate of 400,000–600,000 sq m.

• Development pipeline remains robust, with 34 buildings under construction representing EUR 56.8 million in annualized leases and over 70% pre-let.

• Land bank of 8.5 million sqm supports future growth, with over 3.7 million sqm of development potential.

• Ongoing negotiations for large lease agreements and new constructions, mostly pre-let, support a confident outlook.