Yahoo Finance

• Investment Activity: Over EUR1 billion invested, doubling previous years' activity.

• Portfolio Value: Grown to EUR8 billion with a 98% occupancy rate.

• Annualized Rent: EUR450 million.

• EPRA NTA: Increased to EUR21.

• Loan to Value Ratio: 38%.

• Debt to EBITDA: 7.2.

• New Investments Yield: Average net yield of 6.4%.

• Pipeline in Execution: EUR1.1 billion with a net initial yield of 6.6%.

• EPS Target: EUR1.7 by 2027.

• 2025 EPS Guidance: EUR1.53.

• Cost of Debt: Approximately 2.3%.

• Effective Tax Rate: Expected to rise from 3% in 2024 to 5% in 2025, stabilizing at 6% by 2027.

• Occupancy Rate Projection: Expected to bottom at 97% by mid-2025.

• Retention Rate: Achieved 70% contract prolongations.

• Warning! GuruFocus has detected 9 Warning Signs with WDPSF.

Release Date: January 30, 2025

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

Positive Points

• Warehouses De Pauw SA (WDPSF) achieved strong financial and operational results in 2024, with significant investments enhancing their European footprint.

• The company successfully tripled its portfolio in France, marking a strategic milestone and establishing France as a fifth platform.

• WDPSF maintained a high occupancy rate of 98% and achieved an annualized rent of EUR 450 million.

• The company has a robust investment pipeline of EUR 1.1 billion with a net initial yield of 6.6%, indicating profitable growth potential.

• WDPSF is well-positioned to achieve its EUR 1.7 EPS target by 2027, supported by a strong balance sheet and funding strategy.

Negative Points

• The occupancy rate is expected to decline to 97% by mid-2025 due to certain spaces being returned.

• The company faces challenges in Germany, where investment activity has lagged behind France.

• There is a higher tax burden anticipated from 2025 due to the cancellation of the Dutch REIT regime, impacting earnings per share.

• Development costs have stabilized but remain high, with no significant decline expected due to rising labor costs and quality standards.

• The pre-letting rate on the development pipeline decreased from 72% to 60%, partly due to a client cancellation in Romania.

Q & A Highlights

Q: What can we expect from WDP's investment activity in 2025, and how does Germany compare to France in terms of investment opportunities? A: Joost Uwents, CEO, stated that the focus will be on executing the existing EUR1.1 billion pipeline, which includes committed investments and EUR400 million in negotiations. France has seen significant investment, reaching EUR700 million, while Germany has lagged but marked a milestone with a specialized pharma logistics hub. WDP is open to further investments in Germany but will not go below their cost of capital.