For immediate release

2014 FIRST QUARTER REVENUES

Paris - April 23, 2014

Solid shopping center rents

  •    Shopping center gross rents up 1.1 % like-for-like[1]:
    #_ftn1
    , up 1.5% like-for-like pro forma the disposal of a 2.0 billion euros portfolio of 126 retail galleries[2]:
    #_ftn2
  •    Significant contribution of shopping centers opened or extended over the past four years
  •    On a current basis, shopping center gross rents unchanged due to revenue impact of assets sold in 2013

Sustained leasing activity

  •      More than 660 leases signed this quarter, translating into further upgrade of tenant mix, with renewals and relets leading to positive reversion

Shopping center marketing initiatives

  •      Further deployment of Klépierre's exclusive Club Store® concept
  •      Innovative brand events contribute successfully to shopping center appeal and revenue generation

Disposal of a 126 retail galleries portfolio completed on April 16, 2014

  •      Reshaped and more consistent portfolio of destination shopping centers
  •      Greater focus on selected European dynamic regions

Klépierre's credit rating upgraded to A- by S&P on April 16, 2014

  •      Recognition of the improvement of Klépierre's financial profile and overall asset quality
  •      Klépierre's business risk at the high end of S&P "strong" category

Klépierre, the leading shopping center property company in Europe, today announced its revenues for the first quarter of 2014.


Laurent Morel, Chairman of the Klépierre Executive Board, stated: "Well located in selected prime European regions, actively extended and modernized with new successful developments, Klépierre's portfolio offers a remarkable platform for retailers in Continental Europe. Our efficient leasing management aims at constantly improving the tenant mix and translates into positive reversion as well as overall rental growth. Intensification of marketing initiatives and continuous search for cost efficiencies are the other two key drivers of our actions.
With the disposal of 126 retail galleries completed, we now have a more consistent portfolio made of destination shopping centers, meaning that we are in a position to concentrate even more efficiently on enhancing their attractiveness. We have also strengthened our financial profile and our credit rating has been upgraded to A-. This gives us more latitude in terms of funding our future growth."

SHOPPING CENTER GROSS RENTS: +1.1% LIKE-FOR-LIKE FOR THE QUARTER

Growth in gross rents driven by leading shopping centers, built or expanded in recent years and benefiting from a recently revitalized merchandising mix

Shopping center gross rents amounted to 221.9 million euros for the first quarter of 2014, unchanged compared to the same period in 2013 on a current basis.

On a like-for-like basis, gross rents were up 1.1%, a performance due to qualitative re-leasing operations in core markets (France-Belgium, Norway and Denmark in particular).

In France, Klépierre's landmark shopping centers, such as St.Lazare Paris, Val d'Europe, Les Sentiers de Claye-Souilly, Jaude in Clermont-Ferrand, and Rives d'Arcins in Bègles recorded significant rental growth for the quarter, well above the portfolio average. In Scandinavia, re-lettings at Gulskogen (Norway), Emporia (Sweden) - with the arrival of 6 new retailers, including Armani, and Zara - and at Field's (Denmark) also positively contributed to rental growth. In Spain, Klépierre's leading shopping centers La Gavia (Madrid) and Meridiano (Tenerife) outperformed their local markets. Lastly, Nový Smíchov also posted robust growth in rents - close to 10% for the quarter. Shopping centers opened or expanded in the recent years have also posted solid rental growth, continuing to benefit from the positive dynamic created by an upgraded retail mix.

On a current basis, total gross rents were unchanged compared to the first quarter of last year. This is due to the impact of the disposal of shopping centers (5 in Norway and 1 in France), partly compensated by the strong contribution of 2012/2013 developments in France. Indeed, rental growth in France reached +8.2% for the quarter as compared to same period last year. Recently opened facilities in France, such as Rives d'Arcins and Jaude, performed well above retailer's expectations. Klépierre also benefited from a higher contribution from the Odysseum shopping center (Montpellier), reflecting the increase in Klépierre's stake from 50% to 100% in November 2013. In Norway and Sweden, rental growth was positive on a constant exchange rate basis, but currency fluctuations had a negative impact on growth for the quarter on a current basis.

On April 16, 2014, the disposal of a 2 billion euro portfolio comprised of 126 retail galleries located in France, Spain, and Italy was completed.[3]:
#_ftn3
The assets sold provided 33.6 million euros of gross rents in the first quarter of 2014. Proforma this disposal, total gross rents would have been up 1.5% on a like-for-like basis.


Total revenues unchanged despite assets disposals

Total gross rents amounted to 233.7 million euros for the first quarter of 2014 compared with 235.3 million euros last year, reflecting a decline in retail and office rents that is mainly attributable to the disposals completed in 2013 (1 high-street shop, 1 retail park and 3 office buildings in Paris).
Adding 2.4 million euros of other rental income and 20.2 million euros in fees, overall revenues for the first quarter of 2014 reached 256.3 million euros, almost unchanged compared to the first quarter of 2013 (-0.3%).

Significant upward trend in retailer sales for the first three months of 2014

On a like-for-like portfolio basis and proforma the disposal of retail galleries, retailer sales[4]:
#_ftn4
in Klépierre's shopping malls rose by 1.3% during the first quarter compared to the same period last year. The portfolio benefited from sustained activity across all regions. In particular, shopping centers in Norway, Italy, Portugal and Central Europe posted significantly better sales performances than last year. In France, retailer sales held up well, with a slight overall decrease on a like-for-like basis. Val d'Europe, Rives d'Arcins, St.Lazare Paris, and Le Millénaire reported strong sales increase, while some strategic vacancies - at Créteil Soleil, for example, due to the upcoming Primark opening in June 2014 - are negatively impacting retail sales. Health and Beauty, Services and Entertainment are the best performing retail segments in Klépierre's portfolio. In Italy, Belgium, and Central Europe the Fashion segment posted a robust performance in the first quarter.
Including extensions opened since April 2013 (Vinterbro in Norway, Rives d'Arcins and Jaude Clermont-Ferrand), and proforma the disposal of retail galleries, retailer sales increased by 3.1%.

OPERATIONS

Property management in the first quarter led to the signature of 665 leases. 568 leases were renewed or relet, representing 1.4 million euros worth of additional annual gross rents (+5.0%). Renewed leases and changes in tenant mix led to positive reversion, particularly in France, Belgium, and Denmark. The Group's financial occupancy rate remained high at 96.1%.

A selective and pro-active leasing approach

New leases signed this quarter highlight Klépierre's focus on supporting international retailers in their expansion and addressing their need for modern locations in high-footfall shopping venues: Mango and Desigual will both open a new store at St.Lazare Paris in the 3rd quarter of 2014. At Belle Epine (Greater Paris Area), a flagship shop was signed with H&M to combine two existing floor spaces and add the H&M Home offer in an unparalleled 4,000 sq.m. store. Zara added a 2,000 sq.m. store at Annecy Courier (Lyon region) in January, and Bershka is currently expanding its store at Rives d'Arcins (Bordeaux). In Spain, Primark opened a 3,000 sq.m. store at Meridiano (Canary Islands) in February. This opening has proven to be a real success for both the retailer and the mall, which has seen visitor numbers explode, with footfall up 55% since opening.

Leasing teams also focused on attracting new concepts such as PittaRosso - the Italian shoe retailer - which will make its première in France at Grand Portet (Toulouse) in the 4th quarter of 2014. Sabon (handmade soap retailer) and Llaollao (Spanish natural frozen yogurt chain) both opened a new shop at Rives d'Arcins. In Central Europe, the Group welcomed the first TK Maxx in its portfolio at Lublin Plaza (Poland). This retailer, which offers fashion, shoes, accessories and home equipment, has developed a unique concept in Europe based on the off-price principle. The opening was spectacular, with the number of visitors to the shopping center up 90% on that day. Kiehl's Since 1851, the L'Oréal Group brand offering top quality products for skin care through individual client service, will open its first store in the Czech Republic at Nový Smíchov (Prague) during the second quarter.

A re-tenanting campaign is being successfully pursued at L'esplanade (Greater Brussels Area), with an overall reversion rate of 12% to date. Leases with the most dynamic retailers have been renewed with a 22% upside, while re-tenanting efforts have led to the arrival of newcomers such as Calzedonia, Jules, MAC, SuperDry, The Kase and Undiz, which together provide a 48% upside in rents.

More innovation to enhance shopping experience

Klépierre is actively pursuing the deployment of the Club Store® concept which aims at enhancing the shopping experience. After unveiling The Original Club Store® at Les Passages (Boulogne-Billancourt) and of The Club Store® at Jaude (Clermont-Ferrand), Klépierre also designed the complete refurbishment of Belle Epine[5]:
#_ftn5
- a 140,000 sq.m. mall located in the Greater Paris Area under this exclusive umbrella. The shopping center's 18 million annual visitors will discover the Cosmopolis Club Store® in the fall of 2014.

Klépierre's malls are a unique platform for brands to effectively target their customers while enhancing the shopping experience provided to visitors. For example, Créteil Soleil (Greater Paris Area) was the first of 7 centers to welcome Nespresso for a brand promotion roadshow, combining a coffee tasting with the discovery of its new range of espresso machines.

Stunning and exclusive events were also rolled out: ahead of this year's World Cup, the Barrio Brésil tournament toured in 4 participating centers to share the excitement of soccer and Brazil with shoppers. In April, for the first time ever in France, Klépierre launched in partnership with Disney XD the Super Hero Academy, featuring fun and exciting workshops for children. These premium and exclusive events will be rolled out in the major European shopping centers.

DEBT AND FINANCING UPDATE

As of March 31, 2014, consolidated net debt stood at 7,088 million euros, down 46 million[6]:
#_ftn6
 euros compared to year-end 2013. For the first quarter of 2014, the average cost of outstanding debt was reduced to 3.0% due to the fall in interest rates. At the end of the first quarter, the level of liquidity (available lines and net cash) stood at 1.8 billion euros.

DIVIDEND

On April 10, 2014, Klépierre shareholders approved the payment of a cash dividend of 1.55 euro per share in respect of fiscal year 2013. A total of 303.5 million euros was paid out on April 17, 2014.

EVENTS SUBSEQUENT TO THE CLOSE OF Q1 2014

On April 16, 2014, Klépierre announced[7]:
#_ftn7
it had completed the disposal of a portfolio of 126 Carrefour-anchored retail galleries located in France, Spain, and Italy. The portfolio includes 56 assets in France, 63 assets in Spain, and 7 assets in Italy. As a result of the transaction, Klépierre operates a more cohesive shopping center portfolio of 130 assets in Continental Europe[8]:
#_ftn8
, representing a total value of 13.4 billion euros.
Net proceeds from the transaction of 1.5 billion euros will be used to pay down debt and pursue the optimization of the hedging position. Klépierre's Loan-to-Value ratio as of year-end 2013 proforma this transaction has been reduced to 40.4%.

S&P upgraded Klépierre's credit rating to A- from BBB+ on April 16, 2014 as a result of this transaction.

OUTLOOK

During the first quarter, extension and refurbishment works have continued as scheduled for projects included in our development pipeline of committed projects, such as in Romagna Center (Italy - expected opening date Q3 2014), Centre Bourse (Marseille, France - Q4 2015), the cinemas in Field's (Denmark - Q2 2015). Preparatory construction works also began in Val d'Europe for the 17,000 sq.m. extension scheduled to open in 2017.

Klépierre confirms that it expects the net current cash flow to be at least 2.0 euros per share for the year 2014.


APPENDIX: REVENUES FOR THE QUARTER ENDED MARCH 31, 2014

REVENUES FOR THE FIRST QUARTER OF 2014

   TOTAL SHARE  GROUP SHARE
in million euros   3 months 2014 3 months 2013
(restated9)
  3 months 2014 3 months 2013
(restated[9]:
#_ftn9
)
France   98.8 91.4   79.2 72.6
Belgium   3.7 3.6   3.7 3.6
France-Belgium  102.6 95.0  83.0 76.2
Norway   14.7 20.2   8.3 11.3
Sweden   22.5 23.7   12.6 13.3
Denmark   11.6 11.4   6.5 6.4
Scandinavia  48.9 55.2  27.4 31.0
Italy  28.1 28.1  25.5 24.1
Spain   18.0 18.6   15.7 16.2
Portugal   3.8 3.7   3.8 3.7
Iberia  21.8 22.3  19.6 19.9
Poland   8.5 9.0   8.5 9.0
Hungary   5.2 5.5   5.2 5.5
Czech Republic   5.7 5.4   5.7 5.4
Central Europe  19.5 19.9  19.5 19.9
Other countries   1.0 1.3   0.9 1.1
     
Shopping centers  221.9 221.8  175.9 172.3
Retail   9.9 10.5   9.9 8.8
Offices   1.8 3.0   1.8 3.0
    
TOTAL RENTS  233.7 235.3  187.7 184.1
Other rental income   2.4 1.9   1.8 1.4
Fees   20.2 20.0   16.7 17.0
       
TOTAL REVENUES  256.3 257.2  206.2 202.5


RENTS BY QUARTER (TOTAL SHARE)

in million euros (total share)  2014  2013 restated[10]:
#_ftn10
  Q1  Q4 Q3 Q2 Q1
France   98.8   96.6 92.4 92.9 91.4
Belgium   3.7   3.9 3.6 3.8 3.6
France-Belgium  102.6  100.5 96.1 96.7 95.0
Norway   14.7   16.7 18.5 19.3 20.2
Sweden   22.5   23.7 24.5 23.3 23.7
Denmark   11.6   11.7 12.1 11.9 11.4
Scandinavia  48.9  52.1 55.0 54.5 55.2
Italy  28.1  28.5 27.9 27.7 28.1
Spain   18.0   18.4 17.8 17.2 18.6
Portugal   3.8   3.4 3.6 3.6 3.7
Iberia  21.8  21.8 21.4 20.7 22.3
Poland   8.5   8.7 8.5 8.8 9.0
Hungary   5.2   5.6 5.5 5.2 5.5
Czech Republic   5.7   5.5 5.5 5.5 5.4
Central Europe  19.5  19.9 19.4 19.5 19.9
Other countries   1.0   0.7 1.1 1.3 1.3
   
Total Shopping centers  221.9  223.4 221.0 220.4 221.8
Retail   9.9   10.2 10.4 10.6 10.5
Offices   1.8   2.2 2.7 2.7 3.0
   
TOTAL RENTS  233.7  235.9 234.1 233.7 235.3


CHANGE IN RETAILER SALES FOR THE FIRST QUARTER OF 2014

Year-on-year retailer sales change for the first quarter of 2014
current portfolio comparable[11]:
#_ftn11
portfolio
France 0.7% -1.2%
Belgium 0.1% 0.1%
France-Belgium 0.7% -1.2%
Norway -14.0% 5.5%
Sweden 4.3% 3.1%
Denmark -2.3% -2.3%
Scandinavia -5.3% 3.1%
Italy 2.0% 2.0%
Spain -2.0% -2.0%
Portugal -0.6% -0.6%
Iberia -1.6% -1.6%
Poland 0.2% 0.2%
Hungary 11.8% 11.8%
Czech Republic 6.2% 6.2%
Central Europe 5.1% 5.1%
SHOPPING CENTERS -0.7% 0.7%

FINANCIAL OCCUPANCY RATES AS OF MARCH 31, 2014

  03/31/2014
France-Belgium 97.7%
Scandinavia 96.5%
Italy 97.5%
Iberia 88.8%
Central Europe 95.2%
TOTAL 96.1%


PROFORMA DISPOSAL OF 126 RETAIL GALLERIES COMPLETED ON APRIL 16, 2014

REVENUES FOR THE FIRST QUARTER OF 2014 (TOTAL SHARE)

In millions euros (total share)
Proforma
3 months 2014 3 months 2013
(restated[12]:
#_ftn12
)
France 79.1 71.9
Belgium 3.7 3.6
France-Belgium 82.9 75.6
Norway 14.7 20.2
Sweden 22.5 23.7
Denmark 11.6 11.4
Scandinavia 48.9 55.2
Italy 24.0 24.0
Spain 8.2 8.3
Portugal 3.8 3.7
Iberia 12.1 12.0
Poland 8.5 9.0
Hungary 5.2 5.5
Czech Republic 5.7 5.4
Central Europe 19.5 19.9
Other countries 1.0 1.3
SHOPPING CENTERS 188.3 188.0

 CHANGE IN RETAILER SALES FOR THE FIRST QUARTER OF 2014

Proforma current
portfolio
comparable[13]:
#_ftn13
portfolio
France 1.1% -1.0%
Belgium 0.1% 0.1%
France-Belgium 1.1% -0.9%
Norway -14.0% 5.5%
Sweden 4.3% 3.1%
Denmark -2.3% -2.3%
Scandinavia -5.3% 3.1%
Italy 2.0% 2.0%
Spain 2.7% 2.7%
Portugal -0.6% -0.6%
Iberia 1.3% 1.3%
Poland 0.2% 0.2%
Hungary 11.8% 11.8%
Czech Republic 6.2% 6.2%
Central Europe 5.1% 5.1%
SHOPPING CENTERS -0.6% 1.3%

FINANCIAL OCCUPANCY RATES AS OF MARCH 31, 2014

  03/31/2014
France-Belgium 97.8%
Scandinavia 96.5%
Italy 97.4%
Iberia 92.1%
Central Europe 95.2%
TOTAL 96.6%

03/31/2014
96.1%



AGENDA
July 21, 2014

October 22, 2014
2014 Half-year earnings (press release after market close)

2014 3rd Quarter revenues (press release after market close)

ABOUT KLEPIERRE

A leading shopping center property company in Europe, Klépierre combines development, rental, property and asset management skills.

Its portfolio is valued at 14.1 billion euros on December 31, 2013 (proforma the disposal of a 2.0 billion euros portfolio on April 16, 2014) and essentially comprises large shopping centers in 13 countries of Continental Europe. Klépierre holds a controlling stake in Steen & Strøm (56.1%), Scandinavia's number one shopping center owner and manager.

Klépierre's largest shareholders are Simon Property Group (28.9%), world leader in the shopping center industry, and BNP Paribas (21.3%).

Klépierre is a French REIT (SIIC) listed on Euronext ParisTM and is included into the SBF 80, EPRA Euro Zone and GPR 250 indexes. Klépierre is also included in several ethical indexes - DJSI World and Europe, FTSE4Good, STOXX® Global ESG Leaders, Euronext Vigeo France 20 and Eurozone 120 - and is a member of both Ethibel Excellence and Ethibel Pioneer investment registers. Klépierre is also ranked as a Green Star by GRESB (Global Real Estate Sustainability Benchmark). These distinctions mark the Group's commitment to a voluntary sustainable development policy.

For more information, visit our website: www.klepierre.com:
http://www.klepierre.com

CONTACTS

Vanessa FRICANO - + 33 1 40 67 52 24 - vanessa.fricano@klepierre.com :
mailto:elisabeth.alfandari@ketchumpleon.fr
Julien ROUCH - +33 1 40 67 53 08 - julien.rouch@klepierre.com:
mailto:julien.rouch@klepierre.com

Isabelle LAURENT (Media) - + 33 1 53 32 61 51 - isabelle.laurent@ddbfinancial.fr:
mailto:isabelle.laurent@ddbfinancial.fr

***

This press release is available on Klépierre's website: www.klepierre.com:
http://www.klepierre.com



[1]:
#_ftnref1 On a constant portfolio and constant exchange rate basis

[2]:
#_ftnref2 Please see Klépierre press release dated April 16, 2014 - available on www.klepierre.com:
http://www.klepierre.com

[3]:
#_ftnref3 Please see press release dated April 16, 2014 - available on www.klepierre.com:
http://www.klepierre.com

[4]:
#_ftnref4 Retailer revenues in Klépierre shopping centers, excluding the impact of assets sales, acquisitions, and the opening of new spaces. Primark revenues in Meridiano based on Klépierre estimates

[5]:
#_ftnref5 Klépierre manages Belle Epine shopping center for third parties

[6]:
#_ftnref6 Net debt restated at year-end 2013 for IFRS 10/11 application stood at 7,134 million euros, vs. 7,191million euros published.

[7]:
#_ftnref7 Please see press release dated April 16, 2014 - available on www.klepierre.com:
http://www.klepierre.com

[8]:
#_ftnref8 The updated list of Klépierre shopping centers in France, Italy and Spain is available on www.klepierre.com:
http://www.klepierre.com

[9]:
#_ftnref9 IFRS 10/11 goes into effect on January 1, 2014 and results in a change in the method of consolidation. Entities that were previously proportionally consolidated and that Klépierre does not control are now consolidated under the equity method. 2013 revenues have been restated accordingly. Please see Klépierre Annual Report 2013, page 191, for the detailed reconciliation.

[10]:
#_ftnref10 IFRS 10/11 goes into effect on January 1, 2014 and results in a change in the method of consolidation. Entities that were previously proportionally consolidated and that Klépierre does not control are now consolidated under the equity method. 2013 revenues have been restated accordingly. Please see Klépierre Annual Report 2013, page 191, for the detailed reconciliation.

[11]:
#_ftnref11  Retailer revenues in Klépierre shopping centers, excluding the impact of assets sales, acquisitions, and the opening of new spaces. Primark revenues in Meridiano based on Klépierre estimates.

[12]:
#_ftnref12 IFRS 10/11 goes into effect on January 1, 2014 and results in a change in the method of consolidation. Entities that were previously proportionally consolidated and that Klépierre does not control are now consolidated under the equity method. 2013 revenues have been restated accordingly. Please see Klépierre Annual Report 2013, page 191, for the detailed reconciliation.

[13]:
#_ftnref13 Retailer revenues in Klépierre shopping centers proforma the disposal of 126 retail galleries, excluding the impact of assets sales, acquisitions, and the opening of new spaces. Primark revenues in Meridiano based on Klépierre estimates.

PR_KLEPIERRE_1Q2014_REVENUES_UK:
http://hugin.info/155397/R/1779257/607949.pdf



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The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.
Source: Klépierre via Globenewswire

HUG#1779257