Montea : Interim statement 30-09-2023

Press release Interim Statement

Press release - Regulated information

of the sole director with regard to the period from 01/01/2023 to 30/09/2023

Montea brings 1 million m² of its land bank into development

• Montea, developing investor in real estate, today announces its intention to bring more than 40% of its existing landbank into development by end 2025. This statement is based on the permits obtained for new projects on its existing landbank, as well as ongoing negotiations with prospective tenants for all projects. The roll-out will lead to ca. 600,000 m² of additional lettable warehouses in Belgium and the Netherlands, corresponding to about 10% of the total development market in these countries. This will increase the area (GLA) of the property portfolio by no less than 30% over a 2-year period.
• 63% of the lettable area has been already permitted, with 22% already in execution. Montea expects to bring the remaining 41% into execution in the short term. Of the remaining 37% lettable area not yet permitted, the permit is expected shortly. Moreover, at 43%, the total lettable area is almost half pre-let. Concrete negotiations with potential tenants are at a final stage as regards the area non-pre-let. Once the lease has been signed, construction can usually start immediately given the permitted status of most of the building sites.

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• The projects will be developed at a net initial yield of 7,0% which will generate ca. € 39 million additional rental income on an annual basis.

• On top of the book value of these building sites, which currently stands at € 150 million, Montea will invest an additional € 400 million to realize the roll-out. We expect this investment volume of € 550 million to generate around € 200 million in development margins based on current market valuations, corresponding to a value creation of more than € 10 per share at EPRA NTA level.
• The implementation of these investments will bring the EPRA debt ratio to 42.2%, considering a current EPRA debt ratio of 39.7%, development margin of € 200 million, payout ratio of ca. 80% and annual stock dividend with a 50% success rate.

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• Also in terms of EPS, value will be created for the shareholders. Thanks to rental growth of ca. € 39 million and a controlled maximum average cost of debt of 2.5%, we can offer a sustainable increase of the EPRA result to € 4.55 per share in 2024 and € 4.65 per share in 2025.

• With the remaining landbank of 1,437,000 m² Montea retains significant future development potential, which also provides the necessary flexibility beyond 2025 to plan and execute investments which, again, will create additional value for all stakeholders.

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• Recognition for our ESG strategy
  In September, Montea was included in the BEL® ESG Index, alongside the 19 other highest- ranked companies in Belgium showing the lowest environmental, social and governance (ESG) risk score. Euronext uses the Sustainalytics score as its benchmark, a score we significantly improved from 17.5 to 11.0. This result places Montea as the best Belgian REIT an achievement we are very proud of. For EPRA sBPR and GRESB we were also able to reaffirm our credentials with a Gold Award and a score of 77% respectively.
• Occupancy rate of 100% for the third consecutive quarter, a great achievement on top of the historically high occupancy rate which, since 2018, has consistently exceeded 99%. The high occupancy is a measure of the quality and good locations of the properties in Montea's portfolio.
• Healty market dynamics
• • Contrary to the general trend, the valuation of Montea's existing portfolio ('like-for-like') has remained stable since the peak of the market (June 2022). Also over the first 9 months of 2023, the like-for-like valuation remains virtually unchanged
  • Average lease term1 of ca. 7.0 years to first break
  • Property portfolio located on strategic, multimodal, prime locations
  • Rising market rents for logistics property
  • Inflation-proofcash flow profile (rental income indexed to inflation), as evidenced by a like-for-like rental growth of ca. 7% of which 6% linked to indexation and 1% to reletting
• Strong fundamentals in volatile macro environment
• • Controlled EPRA LTV of 39.7% and Net debt/EBITDA (adjusted) of 8.1x
  • Despite increasing interest rates, the average annualised cost of debt amounts to 2.2%, with our assets being unencumbered
  • Long-termcredit contracts and hedging contracts (both having an average remaining maturity of ca. 7.0 years)
  • Strong liquidity position of ca. € 230 million of readily available funding

• Excluding solar panels.

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Table of contents

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2

1. Including assets held for sale.
2. The occupancy rate is calculated on the basis of sqm. When calculating this occupancy rate, neither the numerator nor the denominator takes into account the unleased sqm intended for redevelopment and the landbank.
3. Surface of leased land (yielding landbank) is included for 20% of the total surface; after all, the average rental value of a site is about 20% of the rental value of a logistic building.
4. Value of the portfolio without deduction of the transaction costs.
5. Accounting value according to the IAS/IFRS rules, excluding real estate intended for own use.
6. The operating margin is obtained by dividing the operating result before the result on the property portfolio by the property result. See annex 2.
7. Financial result (excluding changes in the fair value of the financial instruments): this is the financial result in accordance with the Royal Decree of 13 July 2014 on regulated real estate investment companies excluding the variation in the fair value of the financial instruments and reflects the actual funding cost of the company. See annex 2.
8. EPRA result: this is the net result (after incorporation of the operating result before the portfolio result, less the financial results and corporation tax, excluding deferred taxes), minus the changes in fair value of investment properties and properties held for sale, minus the result on sale of investment properties and plus the changes in fair value of financial assets and liabilities. See also annex 1.
9. EPRA result per share refers to the EPRA result based on the weighted average number of shares. See also annex 1.
10. Result on the portfolio: this concerns the negative and/or positive changes in the fair value of the property portfolio, plus any capital gains or losses from the sale of real estate. See annex 2.
11. Changes in the fair value of financial hedging instruments: this concerns the negative and/or positive changes in the fair value of the interest hedging instruments according to IFRS 9.
12. EPRA LTV or EPRA Loan to value is an important measure to determine the percentage of debt to the assessed property value and is calculated by dividing net debt by total property value (incl. solar panels).
13. Debt ratio according to the Royal Decree of 13 July 2014 on regulated real estate investment companies. See also annex 2.
14. The Adjusted net debt/EBITDA differs from net debt/EBITDA due to an adjustment to the net financial debts in the numerator for ongoing projects in execution multiplied by the debt ratio, as well as an adjustment in the denominator for the annualised impact of external growth.
15. IFRS NAV: Net Asset Value or intrinsic value before profit distribution for the current financial year in accordance with the IFRS balance sheet (excl. Minority shareholdings). The IFRS NAV per share is calculated by dividing the equity according to IFRS by the number of shares entitled to dividends on the balance sheet date.
16. EPRA Net Reinstatement Value: NRV assumes that entities never sell assets and aims to represent the value required to rebuild the entity. The aim of the metric is to also reflect what would be needed to recreate the company through the investment markets based on its current capital and financing structure, including Real Estate Transfer Taxes. EPRA NRV per share refers to the EPRA NRV based on the number of shares in circulation on the balance sheet date. See also annex 1.
17. EPRA Net Tangible Assets assumes that entities buy and sell assets, thereby crystallizing certain levels of deferred tax. The NTA is the NAV adjusted to include real estate and other investments at their fair value and exclude certain line items that are not expected to take shape in a business model with investment properties over the long term. EPRA NTA per share refers to the EPRA NTA based on the number of shares in circulation on the balance sheet date. See also annex 1.
18. EPRA Net Disposal Value provides the reader with a scenario of the disposal of the company's assets resulting in the settlement of deferred taxes and the liquidation of debt and financial instruments. EPRA NDV per share refers to the EPRA NDV based on the number of shares in circulation on the balance sheet date. See also annex 1.
19. Stock market price at the end of the period.

• In accordance with the guidelines issued by the ESMA (European Securities and Markets Authority), the APMs (Alternative Performance Measures) used by Montea, including the EPRA performance indicators, are indicated in this press release with an asterisk (*), informing the reader that the definition concerns an APM. Performance indicators defined by IFRS rules or by law, as well as those that are not based on balance sheet or income statement headings, are not considered APMs. The detailed calculation of EPRA performance indicators and other APMs used by Montea is set out in appendix to this press release.

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