UNIBAIL RODAMCO : -RODAMCO SE : Strong half-year results - Increasing the recurring EPS outlook for 2015 to €10.25 - €10.45 (from €10.15 - €10.35 previously)

Paris, Amsterdam, July 22, 2015

Press Release

HALF-YEAR RESULTS 2015

Strong half-year results - Increasing the recurring EPS outlook for 2015 to €10.25 - €10.45 (from €10.15 - €10.35 previously)

• Recurring Earnings per Share (recurring EPS) at €5.37, up by +8.4% compared to rebased H1-2014⁽¹⁾ and down by only -2.7% after the impact of the disposals in 2014 and 2015
• Strong operating performance: Like-for-like Group Net Rental Income up by +5.3%
• Record low cost of debt at 2.3% while extending average debt maturity to 6.4 years
• Property portfolio increased to €35.7 Bn
• Net asset value per share:
• €177.40, +6.7% (Going Concern Net Asset Value per share)⁽²⁾ vs Dec.31, 2014
• €161.70, +6.9% (EPRA NNNAV per share)⁽³⁾ vs Dec.31, 2014
• €8.2 Bn prime quality development pipeline replenished

"Unibail-Rodamco's H1-2015 results are the first following the decisive reshaping of our French retail portfolio, with the massive non-core disposals, and the full consolidation of mfi in Germany in 2014. The hard work and dedication of the Group's teams resulted in a +4.0% like-for-like NRI growth in our shopping centres despite record low indexation, the delivery of more than €800 Mn of projects, the replenishment of the pipeline, including the approval of the Triangle tower by the Paris City council and the successful debt refinancing. The Group's performance is robust with the like-for-like net rental income up by +5.3% at €725 Mn. Recurring EPS, at €5.37, is above target, with an underlying growth of +8.4%. With confidence in Unibail-Rodamco's ability to continue its strong performance, the outlook for the recurring EPS for 2015 is increased to between €10.25 and €10.45 (from between €10.15 and €10.35 previously)."
Christophe Cuvillier, CEO and Chairman of the Management Board

Figures may not add up due to rounding.

Recurring EPS at €5.37, up +8.4% compared to rebased H1-2014⁽¹⁾
The Group's recurring EPS came to €5.37 in H1-2015, representing (i) an underlying growth of +8.4% from the recurring EPS for H1-2014 rebased for the disposals in 2014 and January 2015 (€4.88), and (ii) +1.6% from the acquisition of the mfi stake from PWREF in July 2014.
Reported recurring EPS decreases by only -2.7% in H1-2015 compared to actual H1-2014.

Strong operating performance, delivering results
The Group's tenant sales were up by +4.2% through June 30, 2015.
Through May 2015, the Group's tenant sales were up by +3.9%, outperforming national sales indices by 270 bps due to, among others, the very strong performance in the Group's Spanish, French and Central European shopping centres, outperforming their indices by 490 bps, 330 bps and 320 bps, respectively.
The like-for-like Net Rental Income (NRI) for shopping centres grew by +4.0% compared to H1-2014, 360 bps above an indexation of only 0.4%, the lowest since 2007. The Group signed 676 leases on standing assets, with a Minimum Guaranteed Rent uplift of +16.1% on renewals and relettings, and +19.5% for its large shopping centres⁽⁴⁾. Unibail-Rodamco signed 88 leases with international premium retailers, up by +11% from 79⁽⁵⁾ in H1-2014. The EPRA vacancy rate remained low at 2.3% of which 0.3% in strategic vacancy.
The Paris region office market was very challenging, with a decrease of -25% in take-up for the first half. In this environment, the results of the Group's French offices were almost flat with a like-for-like NRI growth of -0.8%. A notable success was the delivery of So Ouest Plaza (Levallois, Paris region) in H1-2015. The building is now fully let to L'Oréal.
Convention & Exhibition's strong performance was driven by successful shows such as the "Salon International de l'Agriculture," the "Foire de Paris," the "Le Bourget International Air Show" and the triennial "Intermat" show. NRI was up by +28.7% compared to H1- 2014.

Fast forward innovation
Fostering the Group's leading position in terms of asset quality, premium services and differentiated customer experience, UR Lab, Unibail-Rodamco's incubator, launched several new initiatives in H1-2015 and further refined a number of concepts introduced previously, in order to drive additional footfall:

• The Designer Gallery^TM: this latest innovation aims to recreate the spirit of concept stores and fashion magazines with aspirational, young and lifestyle brands. Polygone Riviera (Cagnes-sur-Mer) and Mall of Scandinavia (Stockholm) were chosen as pilots within the Group and are due to open in Q4 this year.
• Digital marketing: through June 2015, on a like-for-like perimeter⁽⁷⁾, downloads of smartphone applications with several new features increased by +27% (to 3.1 Mn), website visits grew by +17% (to 22.2 Mn) and Facebook fans by +16% (to 4.8 Mn).
• 4 Star^TM Label: with 3 additional shopping centres in H1-2015, 20 of the Group's shopping centres have now been awarded the 4 Star^TM Label.
• The Dining Experience^TM: the fifth Dining Experience^TM was inaugurated on February 7, 2015 at Les Quatre Temps (La Défense, Paris region).

A new record low cost of debt
In H1-2015, the Group took advantage of favourable market conditions to refinance €1.9Bn of existing debt by issuing new diversified debt at attractive conditions and for longer maturities. The Group raised €2.5 Bn of medium to long-term debt. In doing so, Unibail-Rodamco reduced its average cost of debt to a new record low of 2.3% from 2.6% in 2014, and extended the average maturity of its debt to 6.4 years. Financial ratios are strong: Loan-To-Value (LTV) is stable at 37% and the interest coverage ratio increased further to 4.5x. The Group has ample liquidity, with a record level of €5.1 Bn of undrawn credit lines.

A strong asset value growth
The gross market value of the Group's assets as at June 30, 2015, amounted to €35.7 Bn, up +2.7% like-for-like compared to December 31, 2014, driven almost equally by the rental and yield effects. The average net initial yield of the retail portfolio decreased to 4.7% from 4.8% as at December 2014. Going Concern NAV⁽³⁾ stands at €177.40 per share as at June 30, 2015, an increase of €11.10 (+6.7%) compared to December 31, 2014. This increase was the sum of (i) the value creation of €11.68 per share, (ii) the impact of the interim dividend paid in March 2015 of -€4.80, and (iii) the positive impact of the +€4.22 mark-to-market of the fixed-rate debt and derivatives.

Record €8.2 Bn prime quality development pipeline
In H1-2015, the Group delivered 4 projects for a total of €813 Mn, including the Minto shopping centre (Mönchengladbach), and the fully let So Ouest Plaza office tower (Levallois, Paris region), which includes a cinema and restaurant, right next to the So Ouest shopping centre.
The Group added €962Mn of new projects to the pipeline, including the Triangle tower project (Paris) following its approval by the Paris City Council on June 30, 2015. Triangle will be the first high-rise tower built in Paris in 40 years.
The total investment cost of the development pipeline amounts to €8.2 Bn as at June 30, 2015, compared to €8.0 Bn as at December 31, 2014. The Group retains significant flexibility (69%) on its pipeline.

Increased earnings outlook for 2015
Based on the robust performance during H1-2015, the Group increases its outlook for the recurring EPS for the year ending December 31, 2015 to between €10.25 and €10.45 (from between €10.15 and €10.35 previously).
This outlook assumes completion of the pending disposals and no deterioration of the current economic or security conditions in Europe.

The appendix to the press release and the half-year 2015 results presentation are available on the Group's website www.unibail-rodamco.com:
http://www.unibail-rodamco.com

Notes
 ⁽¹⁾      For the disposals in 2014 and January 2015.
 ⁽²⁾      The Going Concern NAV per share corresponds to the amount of equity needed to replicate the Group's portfolio with its current financial structure - on the basis of 100,625,762 fully diluted number of shares as at June 30, 2015 including outstanding ORAs and stock options in the money as at June 30, 2015 (vs 100,177,029 as at December 31, 2014).
 ⁽³⁾      The EPRA NNNAV (triple net asset value) per share corresponds to the Going Concern NAV per share less the estimated transfer taxes and capital gain taxes -on the basis of 100,625,762 fully diluted number of shares as at June 30, 2015 (vs 100,177,029 as at December 31, 2014).
 ⁽⁴⁾      Large shopping centres: assets above 6 Mn visits per annum.
 ⁽⁵⁾     H1-2014 proforma for the disposals in 2014 and H1-2015.
 ⁽⁶⁾     EPRA vacancy rate = Estimated Rental Value (ERV) of vacant spaces divided by ERV of total surfaces
 ⁽⁷⁾     Excluding 2014 divestments and German assets.

For further information, please contact:

Investor Relations
Julie Coulot
+33 1 76 77 57 22
julie.coulot@unibail-rodamco.com

Media Relations
Pauline Duclos-Lenoir
+33 1 76 77 57 94
pauline.duclos-lenoir@unibail-rodamco.com

About Unibail-Rodamco
Created in 1968, Unibail-Rodamco SE is Europe's largest listed commercial property company, with a presence in 12 EU countries, and a portfolio of assets valued at €35.7 billion as of June 30, 2015. As an integrated operator, investor and developer, the Group aims to cover the whole of the real estate value creation chain. With the support of its 2,085 professionals, Unibail-Rodamco applies those skills to highly specialised market segments such as large shopping centres in major European cities and large offices and convention & exhibition centres in the Paris region.
The Group distinguishes itself through its focus on the highest architectural, city planning and environmental standards. Its long term approach and sustainable vision focuses on the development or redevelopment of outstanding places to shop, work and relax. Its commitment to environmental, economic and social sustainability has been recognised by inclusion in the DJSI (World and Europe), FTSE4Good and STOXX Global ESG Leaders indexes.
The Group is a member of the CAC 40, AEX 25 and EuroSTOXX 50 indices. It benefits from an A rating from Standard & Poor's and Fitch Ratings.
For more information, please visit our website: www.unibail-rodamco.com