Release Date: August 28, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Plaza SA (XSGO:MALLPLAZA, Financial) reported a 7% increase in footfall across its urban centers, reaching 73 million visitors in Q2 2024.
- Tenant sales grew by 8.8% year-over-year, driven by strong performance in retail, food and beverage, and entertainment sectors.
- The occupancy rate improved to 95.5%, with notable increases in Peru, particularly in Mallplaza Trujillo and Mallplaza Comas.
- Revenues increased by 17% year-over-year, attributed to higher lease revenues and parking income.
- EBITDA rose by 16.3% year-over-year, achieving a margin of 76.1%, reflecting operational efficiency.
Negative Points
- Net income decreased by 27.6% year-over-year, primarily due to lower variations in the fair value of investment properties.
- Administrative expenses increased by 20.6%, driven by higher personnel costs and currency exchange effects in Colombia.
- Sales per square meter in Peru declined by 7%, with revenues per square meter down by 4%, indicating challenges in that market.
- Higher tax expenses and losses in participation in associates negatively impacted financial performance.
- The company faced temporary negative impacts in Peru due to road detours affecting Mallplaza Buenavista.
Q & A Highlights
Q: Can you explain the variability in sales trends across your Chilean malls, and have you observed any impact from tourism on sales?
A: Derek Schwietzer Tang, Chief Financial and Administrative Officer, noted that Chilean malls saw a 4.7% growth in foot traffic and a 7% increase in tenant sales. The variability is partly due to changes in the tenant mix and some stores being in the opening phase, which temporarily affects productivity. The company expects these changes to enhance mall productivity over time.
Q: Why were sales per square meter and revenues per square meter negative in Peru, and do you expect a reversal of this trend?
A: Derek Schwietzer Tang explained that Peru's occupancy rate increased significantly, but specific factors like road detours for subway construction near Mallplaza Buenavista have temporarily impacted sales. Long-term, these developments are expected to improve mall connectivity and traffic.
Q: What drove the 11.5% year-over-year increase in revenue per square meter, which was above the same-store rent growth?
A: The increase was attributed to efforts in transforming the tenant mix and enhancing revenue lines, particularly in Chile, where revenue per square meter rose by 10.5%. This strategy aims to boost overall mall productivity.
Q: Could you elaborate on the strategic initiatives in Peru, especially regarding the acquisition of Falabella Perú?
A: Cristian Somarriva, Chief Marketing, Customer Experience and Projects Officer, highlighted that the acquisition will consolidate Plaza's portfolio in Peru, making it the second-largest shopping center operator in the country. The plan includes adding 100,000 square meters of GLA over five years to strengthen the commercial offer.
Q: How are omnichannel initiatives impacting Mallplaza's operations?
A: Derek Schwietzer Tang mentioned that the Click&Collect operations have seen a 170% increase in visitors year-over-year. New partnerships with brands like Tricot and Mercado Libre have enhanced the service, benefiting both visitors and business partners.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
