Ladies and gentlemen, welcome to Klépierre's half year financial results. I now hand over to Mr. Jean-Marc Jestin, Chairman of the Executive Board, and Stéphane Tortajada, CFO, who will lead you through this call. Sir, please go ahead. Bonsoir à tous et à toutes, good evening, everyone, and thank you for listening to us tonight. I'm pleased with Stéphane to report a Klépierre 2023 H1 earnings. Over this period, marked by high inflation and monetary tightening, Klépierre has delivered a very strong set of results. First, we continue to grow at a sustained pace and posted a better-than-expected performance, generating EUR 1.21 of Net Current Cash Flow Per Share or a remarkable 7.4% growth year-over-year. Over the period, we carefully managed our expenses, especially our cost of debt, that remained contained at 1.4%, thanks to a very high level of hedging. As a result, we are raising our 2023 full year guidance and now expect to generate at least EUR 2.40 of Net Current Cash Flow Per Share. This represents a 7% increase compared to 2022 and demonstrates our confidence in the future. This being said, let's review our H1 results in more details. First, our robust performance has been underpinned by a 7.3% like-for-like increase in net rental income over the H1. This growth was mainly driven by a 6.1% average indexation and a tight property expense monitoring, translating into an improvement of the net rental income to gross rental income ratio. In the meantime, on the back of strong footfall and sales rebounds, ancillary income was up 28% like-for-like, mainly bolstered by the 36% growth in turnover rents and 32% rise in car park revenues, while specialty leasing was up by 13%. All geographies experienced a robust expansion and exceeded 5% growth in net rental income, especially Iberia and Netherlands and Germany, with net rental income up 12%, when Italy was up 7.8% and France up 5.3%. As regards leasing activity, tenant demand for space in our malls has been very strong, with 809 deals signed over the period, up 16% over one year in volume terms. Through these operations, we let close to 250,000 sq m, while achieving a 5.3% positive reversion on renewals and relatings. We also continue to support the expansion of growing retailers in all segments, especially sports, with banners like JD Sports, Courir, or Foot Locker. The apparel segment, including Inditex, Primark, Calzedonia, Mango, or Deichmann, and in the health and beauty and the value for money verticals with Rituals and Normal. As such, over the last 5 years, omni-channel retailers have been focusing on best-in-class assets to develop under their last format and significantly increase their footprint in our malls. Among others, with more stores and larger ones, Nike and JD Sports have increased by 67% and 47%, respectively, the total area they rent with us since 2019. Same goes with Rituals, up 143%, Normal up 160%, Primark up 48%, or Starbucks, that almost double its footprint. Make no mistake, this performance is a direct result of 2 elements. 1, our top quality portfolio, and 2, our leading marketing and asset management expertise all over Europe. Indeed, we focus on offering the best answer to the challenges and needs of retail tenants while matching shopper expectation. For a decade now, we have put the emphasis on continuously developing and diversifying our retail mix by replacing old-fashioned banners, by new concept, omni-channel retailers and trendy verticals, especially in fashion, health and beauty, restaurants, sports, and services. Besides, with 70 leading malls located in Europe, largest cities with catchment area of over 1 million inhabitants and with revenue per capita 20% over national averages, our portfolio is perfectly suited to the flight to quality strategy applied by retailers. Our properties are clearly identified by expanding banners as must-to-have locations in their development plans. Against this backdrop, in the H1, we consolidated our operating KPIs at very high levels. Our occupancy rate reached 95.7% as of June 30, in line with December 2022 levels, while collection rate was slightly up at 96.5%. Meanwhile, in spite of the 6.1% indexation applied to tenants, we managed to maintain occupancy cost ratio at a sustainable level below 13%. I think this is a solid achievement resulting from a very active service charge management and a solid increase in retail sales that follow the trend that we observed during the H2 of 2022, and which continue to improve. Over the H1 of 2023, sales of our tenants were up 8%, while the footfall jumped by 10%. In terms of retailer sales, southern region were the most dynamic, with Iberia posting 11.2% and Italy experiencing an 8.7% increase. The momentum was also very positive in the Netherlands and Germany, up 17.4%, and Central Europe, up 9.9%, while France was up 5.7%, and Scandinavia increased by 6.4%. Sales growth was also strong in the most segment, with increases from 6.4% for fashion to 16.5% for food and beverage, while household equipment was slightly down due to a solid 2022 base. All these figures underscore the resilience of consumption, notably supported by high level of savings, a starting decline in headline inflation, wage growth, and employment gains that progressively materialize in improvement in real household disposable income. In fact, we note that several retailers recently raised their outlook for 2023, observing that shoppers are absorbing higher prices. Turning now to development activity. We continue to deliver on our development pipeline and with our two main committed projects, Grand Place and Maremagnum. In Grenoble, the construction of the 16,000 square meters extension is planned to open by the end of the year to showcase a global leasable area of 75,000 sq m that will welcome more than 10 million shoppers every year. I'm proud to announce that 100% of the projected net rental income is already let. Among others, Grand Place hosts leading brands such as Zara, Sephora, JD Sports, Normal or Snipes, and Primark will open its first store in the region, while the food area will be upgraded and extended to the latest standard of Klépierre Destination Food strategy. Yield on cost, importantly, is 8%. At Maremagnum in Barcelona, the 5,200 sq m Time Out Market is planned to open between Q4 2023 and Q1 2024, just in time for the America's Cup, to become the Barcelona leisure hotspot for food and beverage. Following the recent enlargement of Lefties, the mall now hosts most of the Inditex satellites, including Pull&Bear, Bershka and Stradivarius, acting as strong footfall drivers. We forecast a yield on cost of 13.5% for this project. Now turning to the balance sheet. Since the beginning of the year, we took part of the strong liquidity available in the financing market. Our conservative balance sheet management came together with renewed debt capital market confidence and enabled us to raise new long-term financing totaling EUR 730 million, with a 6.4-year weighted average maturity. We also renewed or signed EUR 475 million of 6-year revolving credit facility, and we now rely on a EUR 2.5 billion liquidity position covering our refinancing needs until 2027. Over the H1 of 2023, thanks to a strong cash flow generation, we also managed to decrease the net debt to EUR 7.4 billion, while distributing close to EUR 250 million in cash to our shareholders, corresponding to the first installment of the distribution related to 2022. Let me also remind you that on July 11, 2023, we also returned EUR 250 million more, corresponding to the second settlement of the dividend. As of today, we operate one of the most solid balance sheet in the industry. Our loan-to-value ratio is 38.1%, while the leverage ratio, net debt to EBITDA, is 7.9x, and the interest coverage ratio stands at 8.8x, among the highest of our peers. In a quiet investment market, we also closed or signed EUR 82 million of disposals of different retail assets in France and Sweden since January 1st, the transaction were executed in line with book value, just 0.2% below. Despite a rising interest rate, the optimization of our financial structure, undertaken over the last few years, combined with proactive hedging operation, enable us to maintain top-notch credit metrics. The average maturity of the group debt was 6.5 years, while the cost of debt remained low at 1.4%. Going forward, the group hedging is high at 100% for H2 2023 and 98% in 2024. Over the last 6 months, our distinctive financial risk profile has been rewarded by rating agencies. On May 30, Fitch assigned for the first time a senior unsecured rating of A-, on June 9, S&P affirmed Klépierre's long-term rating of BBB+ with a stable outlook. We now enjoy a double investment grade rating delivered by 2 leading agencies that acknowledge clearly our financial discipline. Let me finish my presentation with our solid corporate social responsibility outcomes. I would like to highlight that Klépierre remains the leader of the industry. We are ranked top of the global real, global retail listed, Europe retail, Europe retail listed, and Europe listed categories, with a score of 98 out of 100 by GRESB, the world's leading ESG benchmark for real estate and infrastructure investment. Klépierre is also integrated into the CDP A list of the most advanced companies fighting climate change, included also in the CAC SBT 1.5 degree Index and rated triple A by MSCI. Lastly, since 2020, the group Low Carbon Commitment have also been approved by SBTi at the highest possible level, well below 1.5 degrees Celsius. I am very proud of those ratings, that further encourage us to continue delivering our ambitious Act for Good CSR strategy launched this year. The main pillar of this plan is to achieve a net-zero carbon portfolio with an average portfolio energy efficiency of 70 kWh per square meter. We will also lend our support to retailers energy reduction initiative, with an objective of cutting their consumption by 20% and developing low carbon solutions throughout our portfolio. This is the way we act as a climate leader, aiming to be the most sustainable platform for commerce by 2030. Thank you very much for listening, and now I will leave the floor to the questions. Thank you. This is the conference operator. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchtone telephone. To remove yourself from the question queue, please press star and two. Please pick up the receiver when asking questions. Anyone who has a question may press star and one at this time. The first question is from Céline Soo-Huynh with Barclays. Please go ahead. Good evening. I have two questions, please. I'll take them one by one. The first one is about your guidance that you upgraded by 2%. The previous one was excluding disposals. Can you elaborate what you've, what drove the upgrade? What changed compared to your previous expectations? Yes, thank you, Céline. I think the that we have raised our guidance because the the operational performance is better than expected. This is the main driver. In the guidance, in the guidance, there is no impact of further disposals. If we do disposals between now and the end of the year, we don't expect to do a major disposal by the end of the year. We are very confident that the we will be in line with the new guidance, which has been raised by, as you said, 2%, which is a 7% increase compared to last year. When you say operational performance was better than expected, do you mean that probably less failures, indexation is higher than expected, or can you elaborate on that? It's a bit a combination of, it's not really, more indexation, because I think we, we budgeted, almost what we, got. It's a, it's a series of improvement, as you, as we indicated, the, the, the rebound in sales has pushed the same sales rent up, many of the, of the other ancillary income, like parking revenues and specialty leasing were also a bit better than expected. We have, we have been able also to collect a bit more rent than initially budgeted. I would say, we also cut costs between NRI and GRI. It's a, it's a series of, of, of operational improvement, all over the board. Amazing. Thank you. That second question, can you elaborate on press rumor on KKR acquiring or planning on shopping mall, please? As you said, we, as we said, we never comment rumors, so, so it's only rumors. Okay. Thank you. Thank Thank you. The next question is from, Florent Laroche-Joubert with, ODDO. Please go ahead. Yes, good evening. Thank you for this presentation. Out of 2 questions, the first one is on the ancillary income, which are up for this 28%. What can we expect on this income for the next period? Can we say that it is maybe also linked to the normalization of your activity? Maybe my second question, it is about the cost of debt. It is at 1.4% for the H1. What can we expect maybe for the rest of the year and also maybe in 2024? Thank you. Okay. Thank you, Florent, for, for your 2 questions. I think on the one, I'm not going to itemize the, the guidance for the rest of the year between ancillary income and the other. I think the, as you, as you, have seen the, it's, it's a combination also of, rebound of, of, of, of sales that push the sales base rent. The specialty leasing and parking revenues, it's also, I think, a better asset management and better leasing management after, after 2 years of, of the difficult times. It's not only due to a, to a rebound, post-COVID. I'm very proud that we are also able to, to, to activate different levels of, of, of performance. For the cost of debt, it's 1.4%, and for, for the H2, it will be 1.6%. Yeah, for, for the full year 2023, you can expect something, around 1.6%. Okay. Thank you very much. The next question is from Pieter van der Voort with Kempen. Please go ahead. Hi, team. Thanks for taking my question, and congrats on the results. I got one question on indexation, which is coming quite high. Do you get any pushback from our retailers on this indexation? Again, maybe elaborate a bit how these, yeah, negotiations go? Secondly, on that indexation, is it currently supported by ERV growth? ... Thank you, Pieter, for your question. I think on indexation, we, even though it has been quite elevated in some of the countries, and specifically in the Netherlands, as you know, we didn't really have a significant pushback from retailers. It's fair to say that in some of the regions where indexation was above 10%, in certain circumstances, we have made some specific arrangement with the tenants to not to charge completely the indexation, but I will say 80%. This is very, very, very marginal in most of the countries we had passed the all indexation and not suffered any significant pushback. On, on, the second question was related ERVs. So I think we, we, when we look at the, at the leasing, activity, it's quite sustained. We are also showing a 5.3% reversion on the, on deals. We, we, we think that the, the sales are in, in some of the countries, we clearly see that sales are really growing due to inflation. Even though sometimes the volume are a bit lower, but in, in absolute levels, in Central Europe, Spain, a bit in Italy, but in Portugal, and also, I would think in, in the Netherlands, we have seen really pricing going up due to inflation. We, we consider that our ERVs will also go up accordingly. In terms of valuation, the, you will have noticed that the appetizers have been a bit more conservative on the impact of future indexation on ERVs, as the CAGR for the next 10 years has slightly decreased from 2.8% per annum to 2.4%. I would say the, from a portfolio valuation perspective, this has not been translated, but in many countries, we will see ERVs going up by a significant portion of indexation. Thanks. The next question is from Bruno Duclos with Invest Securities. Please go ahead. Hi. Could you elaborate a little bit on the bank loans that have been signed during H1 in terms of total cost or margin? Yeah, we have issue on a six-year bond, a six-year remaining maturity bond and seven-year maturity bond. In average, the spread or margin achieved in the order of magnitude of 150 basis points. how does... Sorry, go ahead. Sorry. The answer, 150 basis points. Okay. How does it compare to margin you had in, say, 12 months, or I mean, do you see the margin decreasing? Note that in the European IG market, there was no European REIT issuing public bonds. Uh-huh ... since one year, except Vonovia, end of November. Uh-huh. Depend much more, spread. basically, it's difficult to compare, because Uh-huh ... very little transaction. What we can see as a positive today, is that there is more traction, and that's why we have been able to issue some notes. I would say the, the spreads are quite in line with what we have seen end of the summer last year. Mm-hmm. There was you know, widening of spread, end of Q1 this year. Mm-hmm. It has tightened since, and we are around 140-150 right now. I think it's a, it's a market value of the spread today for 6 to 7-year bond. Okay. Okay, I understand that you don't comment on, on remorse. Just the guidance that you are mentioning, is it including some acquisitions, or? No. Hello? It does, it don't. It doesn't. Okay, okay, okay, okay. No. Thank, thank you. No, no acquisition. Okay. Thank you, thank you. The next question is from the conference call in French from Florent Guinot with Bank of America. Please go ahead. Yes, hello. Thank you. Thank you for your results. With respect to the EUR 200 million bond issue that you conducted this quarter, can you give us more information, please? Well, indeed, there was no press release, because it was issued based on underlying bonds. There was just information disclosed on Bloomberg, but as a company, we did not disclose any specific press release. Just that we invested, we increased the two bonds by 2029, 2030, by an additional EUR 100 million, and we paid the market spread level, by what I mentioned, 150 basis points, which I mentioned earlier, on average, over the EUR 200 million. You can consider that out of the EUR 200 million of bonds issued, the average margin or the, or the spread is 150 basis points on the EUR 200 million, which were issued. Next question? The next, next question is from Markus Kulessa with Bank of America. Please go ahead. Yes, good evening. Thank you very much for taking all our questions. I just have a quick question on the on the evolution of your LTV. Just to understand the, 'cause your LTV, so is up 40 basis points, and the EPRA LTV is up 3 or 2.6 percentage points. Just to understand how or what has been the difference in the drivers, and then maybe also looking forward, the EUR 80 something million disposals you have signed and done, as you always say, it's total share. Do you have a number in your, in Klépierre share? And then you said also you, you're not doing any major, any other disposals in H2, it's what you said at the beginning of the call, if I understood that. That in the revised guidance, we assume no further disposal. It doesn't mean that we are not going to do, but I think it's reasonable that it will not be of any important magnitude if we do. For the LTV, the LTV is slightly up. It's mainly due to the impact of the mark to market of the portfolio property, which decreased by, on a like-for-like basis, by -1.4%. For the EPRA LTV, maybe we can take the question off because we don't have that number on top of... We don't have this number with us. We have it, but we don't see where you are referring to. If we can take it offline, we can share more precisely. Okay. Thank you. Thank you. We can switch to the webcast now. We have a question from Frédéric Renard, from Kepler Cheuvreux, who would like to comment on our operational improvement in the gross net rental income versus gross rental income versus net rental income. What is the current margin between the 2, and how confident are you to maintain improvements going forward? What can we expect? Oh, thank you, Frédéric, but I don't want to be too negative on for my answer, but I'm not going to itemize in detail the different levels of improvement between the MRI and GRI. I think the main takeaway, if, if you want one, is that we have reduced cost at different level of operations. We have probably also better managed and non-rechargeable expenses that are have been reduced significantly compared to the previous year. We have been very careful during a year where inflation has been very high, to cut as much as possible all the cost in the company at the operation level, but also at the headquarter level. As you can see, our G&A and payroll number is flat in an environment where inflation was wages inflation was above 5% in Europe. So we have been very, very stringent with costs all over the company, and I think it's a good achievement. The next question is from Degroof. Could you please elaborate on the positive reversion achieved for renewals with existing tenants versus letting to new? No, we are not going to elaborate on that. We are signing renewals and relatings, and a significant part of these are renewals. I think the reversion between renewals and relatings, I would say it's quite similar. We don't have, I don't even have the number on top of my mind, so I'm not going to elaborate. I think there is no tricky. My answer is not tricky, just we don't want to elaborate in that gory detail. We have a question from a French long-only investor. France, you experienced a week of riots at the end of June and at the beginning of July. Could you please elaborate on the consequences for your tenants, and more broadly, how affected your centers have been? Thank you for, for, for the question, for the, for the French audience, but also for the international, international audience. It has been a quite a difficult week, for, for France. Clearly, retail has been exposed to riots quite severely. High street retail, but also some of the shopping centers. I would like to thank you, the whole Klépierre team for working day and night to protect our, our properties. At the end of the day, if even though it was quite a very difficult time, the bottom line, we, the, the, the level of damages we have suffered financially is around EUR 5.2 million, which will be covered by insurance. We had something like 150 stores, between 100 and 150 stores that have been looted and devastated. Out of the 6,000 stores, it's a small proportion, but for our retailers, for some of them, so tough time. They will be insured, and we also have decided to support some of them in the reconstruction of their of their shop. The budget for that is roughly half a million euro, between half a million euro and EUR 1 million for Klépierre. Just to, to add a few details, in terms of traffic, the week of the riot for the center, which has been affected, we have decreased by around 14%. Since then, when we have looked at the traffic again at the end of July compared to end of July 2022, we are +1.5. People came back to the center after the riot. The next question is from Rob Jones with BNP Paribas. Please go ahead. Hi, yeah, thanks for the presentation. I had a question on tenant health and also a question on asset value. Firstly, on the tenant health, I appreciate, obviously, rent collection very strong, and importantly, you're also capturing the vast majority of the indexation that you are legally entitled to. I wonder, in terms of your latest conversations with tenant health, to what extent there's any sort of sign of any incremental pressure on them? It's a question that we get a lot from investors at the moment around going into a sustained period of lower GDP growth. What does that mean for, for tenant's ability to trade profitably? Appreciate your point around yards. Then the one on asset values is obviously asset values, as you said, down only 1.4, like-for-like, during the half. Do you get any indication in terms of the valuers view on the extent to which we could see further outward yield shift? Do you expect going forward, that we could have an environment where yield shift is broadly offset by ERV growth, and thus we can be kind of relatively confident in calling the bottom in terms of asset value? Thanks. Thank you, Rob Jones. For the tenant health, so as you, as you know, I spend a significant part of my time to discuss with our tenants. I think they in, I don't want to be too rosy, but I think the, in the vast majority of finally are going through 2023 in a better shape than they fear they would be at the beginning of 2023 or November, December last year. As you have seen, we see a lot of retailers being much more positive for 2023 and also raising their guidance for the year. Obviously, we have different type of watch lists where we, we, we have signal from our tenants that are going through difficulties. Nothing very special here. I would say the only country where we have a bit more of financial difficulties, it's in France, where you have... Okay. observed that the, the, the number of, of bankruptcies has been picking up very recently, since, I would say, Q3 last year. You know the names. In the rest of Europe, we, we, when we look at the number of bankruptcies, it's very, very low. I would say the, the only signal where we see retailers, which are going through through 2023 in difficulty, it's French. It's mainly fashion retailers, a bit of franchisee also in different segments, like health and beauty. Some of them, it's for one and good reason, is that they have been supported by, by the French government, and they have to repay the state bank loan, and some of them are, are not able to do so. We have seen as, as you see, a pickup in, in bankruptcies. It doesn't really affect the whole performance of Klépierre, as you, as you, as you can notice, because our like-for-like growth in Europe is strong, France has been a slightly weaker than expected due to this, okay. In Italy, the conversation with retailers, it's very positive. Spain and Portugal, very positive. Central Europe, very positive. It's a bit weaker, I would say, in Germany, because Germany, the GDP growth is very lukewarm and has been slightly negative, so the, the retailers are experiencing, I would say, a, a tougher time. Our presence in, in Germany is very small, so it's not really mature. Scandinavia, Sweden, even though we could have fear that the household consumption could have been more impacted by the increase of interest rates for the mortgage, finally, the sales in Sweden has been extremely good and have been up by double digits. I, I would say that not being wanted to be too worried, I would say the sentiment when discussing with the retailers is overall, they are doing, they are doing a good year. Okay. and, and the third question? Also, the I know it's a crystal ball conversation. I think we have the asset class we own has already seen an expansion of yields, discount rate and exit yields. This has started, I don't know, almost two or three years ago. We have already. Yeah ... expanded quite a lot. Yeah. In the current interest rate environment, as long as they will stay as they are today, it is probably, can be expected that a yield could slightly be expanded again for all type of asset classes, I would say. When they will, they will, they will, they will, interest rate will slightly go down, probably, this will stop. That's my sentiment, even though I cannot put a number on this sentiment. Yeah. On the leasing side, it's also fair to say that the leasing deals we are doing are really supporting the fact that indexation is passed to the tenants. That inflation is also having an impact on ERVs. I would say that, when you mix all that up, okay, when you look at the CAGR of in our DCF for the next 10 years of the net rental income, it's 2.4%, which I think it's rather modest. I think we will probably see this growing even though it's not the assumption they have taken. All in, I, I think the, the, the valuation we should, start to, stabilize, at the end of 2023, mid of 2024. That's my sentiment. I'm not doing the job for the appraisers, but that's, that's how we, we see the future for the next, I would say 12 months. Thank you very much. Thank you. We have one more question from the webcast, from Ina Maslova, which is the second one: What is your assumed cost of debt for 2023 and 2024, given the high level of hedging? Is it at 1.4%? Thank you. For 2023 full year, we expect to be around 1.6%, and for 2024 full year, we expect to be at maximum 1.9%. Now, we have one question from a Boston-based asset manager: How do you see the current acquisitions of mall made across Europe recently? How do we see that? We are not really active in terms of acqui- doing acquisitions. We are, we are a bit on the sideline. There are, there are not so many transactions as we can observe. For the time being, we, we have no, no acquisition on the radar list. On the radar screen, sorry. We have one more question from a U.K. hedge fund investor: could you consider a share buyback program in the coming months? This, if, if it has to be done, this would be a decision of the board. It's not in my... I, I can't answer to that question. We did in the past share buyback when we were doing disposals, and this was to soften the dilution of disposals. Today we are running the company with a view of keeping the debt flat or decreasing. We are not spending a lot of CapEx on new projects, so we are, I think, in a very good situation to manage a balance sheet. And we have no specific plan to increase leverage or to reduce the deleveraging of the company. Okay. Thank you very much for for attending and for your questions. And we put an end to this to this conference call. Thank you very much. Thank you very much. Bye-bye. Thank you. Ladies and gentlemen, thank you for joining. The conference is now over, and you may disconnect your telephones.