Mexico City, October 22nd , 2020 – Terrafina® (“TERRA” or “the Company”) (BMV: TERRA13), a leading Mexican industrial real estate investment trust (“FIBRA”), externally advised by PGIM Real Estate and dedicated to the acquisition, development, leasing and management of industrial real estate properties in Mexico, announced today its third quarter 2020 (3Q20) earnings results.
The figures in this report have been prepared in accordance with International Financial Report Standards (“IFRS”). Figures presented in this report are expressed in millions of Mexican pesos and millions of U.S. dollars, unless stated otherwise. Additionally, figures may vary due to rounding.
Operating and Financial Highlights as of September 30th 2020
Operating
- As of September 30th, 2020, the occupancy rate was 95.5%, a 79 basis point decrease compared to the third quarter of 2019 (3Q19).
- Renewal rate in 3Q20 was 82.2%.
- Annualized average leasing rate per square foot in 3Q20 was US$5.18, unchanged compared to 3Q19.
- In 3Q20, Terrafina reported a total of 42.3 million square feet (msf) of Gross Leasable Area (GLA) comprised of 289 properties and 306 tenants.
- 3Q20 leasing activity totaled 2.6 msf, of which 15.6% corresponded to new leases, 57.2% to lease renewals and 27.2% to early renewals. Leasing activity was concentrated in the Ciudad Juarez, Queretaro, Ciudad Acuña, Monclova, Guadalajara, Cuautitlan Izcalli, San Luis Potosi, Chihuahua, Torreon, Ramos Arizpe, Hermosillo and Irapuato markets.
Financial
- 3Q20 net collections (rental revenue – uncollected revenue from the quarter + revenue collected from the previous quarter) were $50.4 million, a 0.9% or US$0.5 million decrease compared to 3Q19.
- 3Q20 rental revenues reached US$49.9 million, a 2.4% or US$1.2 million increase compared to 3Q19.
- 3Q20 NOI was US$48.0 million, a 6.4% or US$3.3 million decrease compared to 3Q19.
- The NOI margin reached 93.7%, a 79 basis point decrease compared to 3Q19.
- 3Q20 EBITDA reached US$43.2 million, a decrease of 6.8% or US$3.2 million compared to 3Q19.
- The EBITDA margin for 3Q20 was 84.3%, a 107 basis point decrease compared to 3Q19.
- 3Q20 adjusted funds for operations (AFFO) reached US$25.9 million, a decrease of 15.1% or US$4.6million compared to 3Q19.
- The AFFO margin for 3Q20 was 50.2% for 3Q20, a 546 basis point decrease compared to 3Q19.
- 3Q20 distributions totaled US$22.0 million, on an 85% AFFO payout ratio. As a result, Terrafina will distribute Ps.0.6191 per CBFI (US$0.0279 per CBFI) for distributions corresponding to the period from July 1st to September 30th, 2020.
- The dividend yield for the quarter was 8.9% considering the average share price for the quarter of US$1.26 (Ps.27.79).
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About Terrafina
Terrafina (BMV:TERRA13) is a Mexican real estate investment trust formed primarily to acquire, develop, lease and manage industrial real estate properties in Mexico. Terrafina’s portfolio consists of attractive, strategically located warehouses and other light manufacturing properties throughout the Central, Bajio and Northern regions of Mexico. It is internally managed by highly-qualified industry specialists and externally advised by PGIM Real Estate. Terrafina owns 300 real estate properties, including 289 developed industrial facilities with a collective GLA of approximately 42.3 million square feet and 11 land reserve parcels, designed to preserve the organic growth capability of the portfolio. Terrafina’s objective is to provide attractive risk-adjusted returns for the holders of its certificates through stable distributions and capital appreciations. Terrafina aims to achieve this objective through a successful performance of its industrial real estate and complementary properties, strategic acquisitions, access to a high level of institutional support, and an effective management and corporate governance structure. For more information, please visit www.terrafina.mx/en.
About PGIM Real Estate
As one of the largest real estate managers in the world with $182.0 billion in gross assets under management and administration1, PGIM Real Estate strives to deliver exceptional outcomes for investors and borrowers through a range of real estate equity and debt solutions across the risk-return spectrum. PGIM Real Estate is a business of PGIM, the $1.4 trillion global asset management business of Prudential Financial, Inc. (NYSE: PRU).
PGIM Real Estate’s rigorous risk management, seamless execution, and extensive industry insights are backed by a 50-year legacy of investing in commercial real estate, a 140-year history of real estate financing2, and the deep local expertise of professionals in 31 cities globally. Through its investment, financing, asset management, and talent management approach, PGIM Real Estate engages in practices that ignite positive environmental and social impact, while pursuing activities that strengthen communities around the world. For more information visit www.pgimrealestate.com.
1As of June 30, 2020. Includes US$39.3 billion in AUA.
2Includes legacy lending through PGIM’s parent company, PFI.
About PGIM and Prudential Financial, Inc.
PGIM, the global asset management business of Prudential Financial, Inc. (NYSE: PRU), ranks among the top 10 largest asset managers in the world1 with more than $1.4 trillion in assets under management as of June 30, 2020. With offices in 16 countries, PGIM’s businesses offer a range of investment solutions for retail and institutional investors around the world across a broad range of asset classes, including public fixed income, private fixed income, fundamental equity, quantitative equity, real estate and alternatives. For more information about PGIM, visit www.pgim.com.
Prudential’s additional businesses offer a variety of products and services, including life insurance, annuities and retirement-related services. For more information about Prudential, please visit www.news.prudential.com.
Prudential Financial, Inc. of the United States is not affiliated in any manner with Prudential plc, incorporated in the United Kingdom or with Prudential Assurance Company, a subsidiary of M&G plc, incorporated in the United Kingdom.
1As ranked in Pensions & Investments’ Top Money Managers list, 27 May 2019; based on PFI total worldwide institutional assets under management as of 31 Dec. 2018. Assets under management (AUM) are based on company estimates and are subject to change.
Forward Looking Statements
This document may include forward-looking statements that may imply risks and uncertainties. Terms such as “estimate”, “project”, “plan”, “believe”, “expect”, “anticipate”, “intend”, and other similar expressions could be construed as previsions or estimates. Terrafina warns readers that declarations and estimates mentioned in this document, or realized by Terrafina’s management imply risks and uncertainties that could change in function of various factors that are out of Terrafina’s control. Future expectations reflect Terrafina’s judgment at the date of this document. Terrafina reserves the right or obligation to update the information contained in this document or derived from this document. Past or present performance is not an indicator to anticipate future performance.
Conference Call
Terrafina
(BMV: TERRA13)
Cordially invites you to participate in its Third Quarter 2020 Conference Call
Friday, July 23, 2020
11:00 a.m. Eastern Time
10:00 a.m. Central Time
To access the call, please dial:
from within the U.S. +1-877-407-8031
from outside the U.S. +1-201-689-8031
from Mexico (toll free) 01-800-522-0034
Audio Webcast Link:
https://www.webcaster4.com/Webcast/Page/2133/37684
To access the conference replay please dial:
U.S. +1-877-481-4010
International (outside the US) +1-919-882-2331
Passcode: 37684