Shopper Park Plus Q1 Profit Up Significantly

The Shopper Park Plus Group's first quarter 2025 profit after tax was EUR 10.5 million, significantly higher than the profit of EUR 4.4 million in the same period of the previous year, the Group has announced on the website of the Budapest Stock Exchange.

The profit was largely based on the revaluation gain on Slovakian properties, which is now included in the Group's accounts for the first time, amounting to EUR 9.7 million. As the SPP Group's stake in Slovakian real estate is 60%, the increase in earnings per share was lower than the increase in consolidated profit after tax, at 50 euro cents in the first quarter of 2025, compared to 34 euro cents in the same period of the previous year.

In the first quarter of 2025, the Shopper Park Plus Group added 4 retail parks in Slovakia, in which it holds a 60% stake. The acquired properties were previously owned and operated by Tesco Group. As with SPP Group's previous transactions in Hungary and the Czech Republic, Tesco will continue to be the tenant of the retail parks through its local subsidiary TESCO STORES SR, a.s. With the transaction in Slovakia, the Shopper Park Plus Group has taken a significant step towards its strategic goal of becoming one of the leading, meaning one of the largest and one of the most profitable food-centric retail parks in Central and Eastern Europe (CEE).

Shopper Park Plus Group is looking for additional financing to continue its development. These include, subject to market conditions, a possible cash capital raise to support the planned expansion in the CEE region in Poland and/or Romania, in line with the Company's previously announced strategy. The Company is also actively exploring the possibility of a dual listing on another stock exchange in CEE. Based on the existing bank loan agreement, the revolving credit facility of up to EUR 30 million could support, among other things, the development of existing real estate.

Of the 30,000 m2 of leasable area covered by the option to redeem part of Tesco's leasable area in Hungary, 22,000 m2 have been leased until 31.03.2025. The applications for change of use of the areas covered by the option have already been accepted by the competent authority in seven locations, and planning and preparation is ongoing in one location. The leasing of the sites taken over with the call option involves additional significant expenses due to the development costs, which will be implemented by the SPP Group in a phased manner.

The significant variables affecting the SPP Group's profitability and plans are the development of retail sales, tenant expectations, yield levels, inflation and changes in energy prices. Yield levels that are significant to SPP Group's operations: the 3-month Euribor, the 5-year interest rate swap in the first quarter of 2025, continuing the trend of 2024, continued to decline, improving the operating environment.

The SPP Group's operational strategic objective is to reduce operating losses, which it plans to achieve through the development of real estate infrastructure and the rationalisation of operations. The operating loss per rental income ratio has decreased from 15.5% in Q1 2024 to 13.9% in Q1 2025. The SPP Group's operational strategy remains unchanged: to reduce the operating loss to a level at or below the industry benchmark of 5% to 10% of rental income, thereby further improving its ability to generate income.