Full Year 2024 Covivio SA Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Veronique Meertens - Van Lanschot Kempen N.V. - Analyst : A few from my side. Maybe first on the guidance. You just mentioned EUR4 stable per share, but in my calculation, I actually get at EUR4.44. So just wondering, if you are indeed expecting a stable per share basis. Plus what are the exact drivers of the guidance? So how many disposals or acquisitions or investments do you have penciled in to drive to that EUR495 million?

Question: Veronique Meertens - Van Lanschot Kempen N.V. - Analyst : Okay. That's clear. And maybe on those investment opportunities in hotels, what are you currently seeing in the market? How serious are the opportunities out there? Because through the scrip dividend of Covivio Hotels, you, I guess, hope to increase that stake. But do you already have an indication that the rest of the shareholder base might not take up the scrip dividend?

Question: Veronique Meertens - Van Lanschot Kempen N.V. - Analyst : Okay. That's very clear. Maybe one last thing for me. So on the office lettings, you already briefly mentioned CB 21. I just wanted to get a bit of a view on how you expect that occupancy or vacancy to roll out because you mentioned that the middle floors, you're in advanced discussions. But if you're refurbishing or have quite an extensive program on the upper floors, does that put a delay on the letting of the middle floors as well?

Question: Stephanie Dossmann - Jefferies - Analyst : So maybe three questions from my side. Regarding your non-core portfolio on offices, which is 6%. What is the strategy going forward? I know you quoted EUR150 million under discussions, but what can we expect in terms of disposals phase, I would say? And also on the German office portfolio, what is your strategy there given the value decline was very significant again this year? The second question on German residential. What is your view on the German elections, more regulation expected or not? I know it depends on the cold and the coalition. But do you have a view on that? And maybe last one for the guidance of '25, I agree with Veronique, I was at EUR4.44 and assuming the number of shares you disclosed in your report yesterday. So yes, maybe more precise figure on that and the -- your indexation assumption for '25, please?

Question: Stephanie Dossmann - Jefferies - Analyst : Maybe on indexation, what assumption do you take for '25, please?

Question: Florent Joubert - Oddo BHF Securities - Analyst : I would have one question about investment and disposals. So what would be reasonable to expect in terms of acquisition and disposal in 2025, so after the high volume of disposal in 2024, notably.

Question: Florent Joubert - Oddo BHF Securities - Analyst : And can we ask you if you have some active discussion at the moment?

Question: Alan Marley - Colitas - Analyst : Just two, the first one on German office. I appreciate, I think you already answered this, but maybe just asking in a different way. Occupancy has been depressed there for quite a few years now. Is that something you expect to pick up over the coming years? Or does the economic and political uncertainty in the region potentially put more downward pressure on occupancy levels there? And then just on the hotel portfolio, which you said that you would expect to increase, particularly in Southern Europe. Do you expect that mainly to be fixed leases? Or do you expect to continue growing your exposure to the operating properties beyond the current 40%?

Question: Alan Marley - Colitas - Analyst : That's clear. Maybe just one. If the German portfolio in office was to remain particularly weak this year, maybe a bit of a prolonged period of time, would you consider potentially some rotation, selling some of those assets and moving more into the hotel sector there with some of that disposal cash?

Question: Adam Shapton - Green Street - Analyst : Just one on capital structure and balance sheet. So you set out for a while now the split of the portfolio that you want to achieve a third, a third, a third, which is a change in risk profile, I think, of the overall portfolio. Can you talk about what you think is the appropriate capital structure and balance sheet by 2030 in terms of debt EBITDA, in terms of debt maturities, any other measures that you think about, assuming that that's not something you can achieve overnight? Where do you want the balance sheet to be by 2030 with that change in portfolio mix?

Question: Celine Soo-Huynh - Barclays - Analyst : Just one question for me on German resi, please. The best capital allocation you can think of at the moment is selling your low-yielding German resi and investing into higher-yielding hotels. So what are your expectations for German resi privatization this year? And should we expect a ramp-up here going forward?