MLP Group has a very good financial standing and a safe capital structure enabling the implementation of long-term strategic goals. This is confirmed by its reported 2022 performance figures. The Group’s Net Assets Value (NAV) went up 37%, to just under PLN 2.5 billion (EUR 532.6 million).
The value of its investment properties rose 31%, to more than PLN 4.4 billion (EUR 945 million). Consolidated revenue improved 39% yoy, to PLN 279.1 million (EUR 59.5 million), driven by an increase in leased area combined with higher rental rates. Rental income from investment properties increased by 31%, to PLN 152.9 million. At the same time, the Group’s EBITDA (without revaluation of investment properties) improved by 47%, to PLN 135.1 million (EUR 28.8 million). Last year, MLP Group earned PLN 422.4 million (EUR 90.1 million) in net profit.
Strong lease results in 2022
MLP Group is developing its operations in Poland, Germany, Austria and Romania. The Group’s existing portfolio comprises 21 logistics parks. Its strategic goal remains to expand the warehouse portfolio by developing big-box facilities and urban logistics projects.
In 2022, MLP Group signed leases for 235 thousand sqm of space. New completions with a total area of 226 thousand sqm were located mainly in Poland and Germany. At the end of last year, the Group had a total of 1 million sqm of built space, with a further 119 thousand sqm under development or in the pipeline. Development potential of the Group’s existing landbank is close to 1.8 million sqm. In addition, the Group has reservation agreements to purchase new plots with an area of some 200 hectares, allowing it to develop another 1 million or so sqm of new space.
Ambitious plans for 2023
High occupier demand for warehouse space across all markets where MLP Group operates is driven mainly by the trend of near-shoring, continuing e-commerce demand and restructuring of supply chains. Other key drivers of demand for logistic space include low availability of vacant space and no signs that supply and demand will come into an equilibrium in the short term. Rents are likely to continue the growth course.
The Group intends to continue its strong development in Germany. It plans to strengthen and expand its presence in new key locations, but also in the regions it already present, i.e. the Ruhr area, Brandenburg and Hessen land. It also expects to strengthen its foothold on the Austrian market and is looking to enter the Benelux countries soon. The Polish market remains crucial and MLP Group will continuously increase offer in key logistics regions. According to the strategy, capital expenditure (CAPEX) in 2023 will amount to about EUR 215 million, of which about 30% will be allocated to purchase of new plots. This year the level of commercialization is planned to go up by about 20%.
„We continue to see robust occupier demand combined with market vacancies close to historic lows in supply-constrained markets, We expect this contrast between positive demand and limited supply to drive further growth in rental levels.
In 2022, we have leased 235 thousand sqm. Our total portfolio reached 1 064 million sqm with 98% occupancy across all our assets and new space under development amounts to 119 thousand sqm. In 2022, we successfully continued our efforts to diversify our assets (Big-box logistic and Urban Logistic), tenants and geographies. Further development on the German market is a key point of our strategy.
In 2023, we launch new projects in Germany, Austria and Romania, we are not slowing down our development in Poland. Tenants from the light industry and logistics sector were the largest tenants of our space in 2022. We expect this trend to continue – tenants from the light manufacturing and nearshoring sector will be the main source of lease agreements in 2023” – said Radosław T. Krochta, President & CEO of MLP Group
Excellent financial standing
Considering the current geopolitical situation and high volatility in the economy, MLP Group is very well prepared for the current challenges. Proceeds of the latest share issue amounted to PLN 183.5 million.
„100% lease agreements indexed with CPI for EUR without any cap (indexed once a year in February). All rentals are denominated in EUR or are directly expressed in EUR, which significantly reduces our exposure to the currency risk. MLP Group has a very good financial standing and a safe capital structure enabling the implementation of long-term strategic goals. With the modest leverage (LTV at 33.1%), long-average debt maturity of 5.1 years, no near-term refinancing requirements and virtually entire debt at fixed or capped rates, we have significant financial flexibility to continue to invest capital in the development and acquisition opportunities that offer the most attractive risk-adjusted returns” – added – Radosław T. Krochta, President & CEO of MLP Group
MLP Group also maintains a strong cash-flow position. LTV (loan-to-value) last year was at 33.1%, the highest interest coverage ratio at 3.3x ICR. The Group had a long debt maturity ratio of 5.1 years. FFO (funds from operations) amounted to PLN 86.8 million (EUR 18.5 million), an increase of 59% yoy.
In keeping with its build & hold strategy, MLP Group retains completed logistics parks in its portfolio and manages them. All projects undertaken by MLP Group are distinguished by very attractive locations of the logistics parks, application of built-to-suit solutions, and support given to tenants during the lease term.