• Net Profit: Over EUR1 billion in 2024.
• Leases Signed: 2.1 million square meters, a 7% increase from 2023.
• Gross Rental Income: EUR664.1 million, a 16% year-on-year increase.
• Net Rental Income: Increased by 90% year-on-year.
• Annualized Rental Income: EUR743 million.
• Adjusted Earnings Per Share: EUR0.80, a 9.9% increase year-on-year.
• Total Gross Asset Value: EUR16 billion, up 17.2% in 2024.
• EPRA Net Tangible Assets Per Share: EUR18.08, a 13.6% increase.
• Debt Raised: EUR2.4 billion in 2024.
• Cash Position: EUR855 million.
• Liquidity Position: EUR2.2 billion.
• Average Cost of Debt: 3.1%.
• Interest Coverage Ratio: 2.6 times.
• Loan-to-Value Ratio: 45.3%.
• Expected EPS for 2025: EUR0.86 to EUR0.88, representing 8% to 10% growth.

• Warning! GuruFocus has detected 5 Warning Signs with XPRA:CTP.

Release Date: February 27, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• CTP NV (XPRA:CTP) reported a record profit of over EUR1 billion for 2024, marking a significant financial achievement.
• The company achieved a 7% increase in leasing activity compared to 2023, signing 2.1 million square meters of leases.
• CTP NV (XPRA:CTP) maintained a high tenant retention rate of around 90%, with two-thirds of new business coming from existing clients.
• The company is experiencing rental growth, with higher lease rates per square meter compared to the previous year.
• CTP NV (XPRA:CTP) is expanding its presence in Germany with strategic acquisitions, including a flagship project in Dusseldorf.

Negative Points

• Geopolitical tensions and import tariffs are impacting the region, posing challenges for CTP NV (XPRA:CTP) and its clients.
• The company's tenant retention rate slightly decreased from 90% to 87%, which could be a concern if it continues to decline.
• CTP NV (XPRA:CTP) faces potential delays in construction projects, which could impact delivery timelines.
• The company's cost of debt is expected to increase slightly as new funding is acquired at higher interest rates.
• There is a noted undersupply of A-class warehouse space in Central Europe, which could limit growth opportunities.

Q & A Highlights

Q: Can you comment on the Q4 leasing volumes and expectations for 2025, particularly in Romania given the political environment? A: Remon Vos, CEO, explained that Q4 leasing was strong due to increased confidence and ongoing negotiations. Romania is becoming a strategic logistics hub, especially Bucharest, due to its location and infrastructure improvements, making it attractive for regional operations.

Q: What are the conditions needed to achieve the higher end of your delivery guidance of 1.7 million square meters? A: Maarten Otte, Head of Investor Relations, stated that achieving the higher end depends on tenant demand and construction progress. The company is confident due to strong leasing activity and efficient in-house construction capabilities.

Q: What factors are influencing tenant decisions to choose Central and Eastern Europe (CEE) over other regions? A: Maarten Otte noted that companies are moving operations to CEE due to cost advantages and geopolitical factors. Near-shoring trends are driven by the need for local production to mitigate risks associated with global supply chains.

Q: Can you provide insights into the income from development activities and its sustainability? A: Richard Wilkinson, CFO, explained that income from development activities is linked to near-shoring trends, with manufacturers requiring more fit-outs. While 2024 was strong, future income will depend on the mix of tenants and their specific needs.

Q: How do you view the potential for yield compression in 2025? A: Maarten Otte expects further yield compression due to increased market activity and lower cost of debt, which will support valuations and potentially compress yields further in the CEE region.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.