In This Article:
Release Date: May 07, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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IRSA Inversiones y Representaciones SA (NYSE:IRS) reported a positive net income of 35 billion pesos, reversing a previous loss of 40 billion pesos.
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Tenant sales in shopping malls increased by 13.4% compared to the same quarter in the previous year, indicating a recovery in economic activity.
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The company's office segment maintained a 100% occupancy rate, showcasing strong demand for premium office spaces.
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IRSA successfully tapped the international capital market, issuing 10-year notes for $300 million, enhancing its financial flexibility.
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The Rambla del Plata project has shown significant progress in commercialization, with sales and swaps totaling $166.1 million, indicating strong market interest.
Negative Points
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The hotel segment faced challenges with a drop in revenues and occupancy due to a decrease in international tourism and ongoing construction works.
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Despite improvements, tenant sales for the nine-month period were still 4.6% below the previous year.
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The appreciation of the Argentine peso led to valuation losses in investment properties, impacting net income.
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The company's rental segment saw a 4.9% drop, primarily driven by the hotel sector's underperformance.
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IRSA's debt structure, while conservative, remains concentrated in the short term, although recent actions have aimed to extend debt maturity.
Q & A Highlights
Q: When is the construction of the first buildings of the Rambla del Plata project expected to begin, and when will the urban development works be completed? A: The work for stage A is expected to be completed by July of next year. The first buildings are anticipated to start within a year or 10 months from now, as developers are currently planning their projects and obtaining necessary permits. (Answered by Unidentified_3)
Q: Is the company entering a more intensive CapEx phase, and will the net financial debt-to-EBITDA ratio increase? A: While IRSA is optimistic about future growth and has launched several projects, the company is executing strategies that do not require significant capital investment initially. The Rambla del Plata project, for example, involves developers making investments with IRSA receiving square meters in return. The company maintains a conservative debt structure and may increase leverage slightly if opportunities arise. (Answered by Unidentified_2)
Q: Could you elaborate on the structuring of agreements with developers for Rambla del Plata, and what is the upside in proceeds that IRSA keeps? A: IRSA provides the land and agrees with developers on a percentage of the project, currently around 25-26%, which may increase to 30% as the neighborhood develops. The company will receive square meters in about 2-3 years, and the value of these will likely increase as the market and neighborhood develop. (Answered by Unidentified_3)