MLP Group expects to meet the objectives of the strategy in force by the end of 2024, along the way fulfilling the mid-term goals for the current year, according to President Radosław T. Krochta. The company is finishing work on the assumptions of the strategy for the coming years, in which, however, there will be no very significant changes.
“We are committed to strategic goals for 2023. We don’t see a big threat here. We are fully comfortable with the ‘hard’ targets, including revenues and EBITDA, especially since we assumed a 5% increase in rents this year and we will achieve a 10% increase at the end of the year,” said Krochta.
“Without fear, we are also approaching the implementation of all the assumptions set at the end of 2024. Maybe only beyond the valuation, which we have no control over. Due to the unpredictability of the PLN/EUR exchange rate and the trajectory of interest rate fluctuations, which are correlated with capitalization rates, i.e. the valuation of real estate, taking into account the above, the amount of NAV is quite unpredictable. Taking into account the current macroeconomic environment, it is difficult for us to forecast the value of NAV. On the other hand, the assumed growth and value of EBITDA will certainly be made,” he added.
The MLP Group strategy assumes approx. EUR 67 million EBITDA in 2024 ( meantime 48 million euros in 2023), net assets (NAV) of 800 million euros and 35% organic growth per year.
“At the turn of the year, we anticipate a presentation of the assumptions of our new strategy by 2027. We will give the resultive targets. However, we do not anticipate changes in the directions of development. The structure of the portfolio with the participation of Germany will remain approx. 45%, Polish 45% and 10% of other markets, such as The Netherlands; still in our portfolio will be only projects in the main cities,” the president said.
“If a dividend is passed by 2027, it will be symbolic, because we want to direct funds primarily to development. Therefore, we are planning to move from defaulting on the dividend now, by the symbolic in the years to 2027 and then the ‘full’ dividend,” explained the president.
In his opinion, the market situation in terms of warehouse business is good in all European markets, demand remains at a good level, with low vacancy levels.
“The German warehouse market is in good shape and looks better than it is described in the media. It is reinforced by the transformation associated with nearshoring – German companies with a large exposure to Asia, transfer production back to Germany. There are a lot of investments related to e-atuts. From our perspective, it looks good, except maybe the chemical industry,” said Krochta.
“The market in Poland also looks quite positive. We see a big reflection, we have a lot of conversations, although it takes a little longer to make decisions. Most of the contracts signed by us in the fourth quarter concerned light production,” he added.
Krochta emphasized that the expansion of the warehouse project portfolio is proceeding as planned.
“Grunty is available and we are constantly looking for new ones, although our assumption that their prices will decrease will not come true. However, we will not ‘fight’ with the market; we will accept prices, especially since we have raised the rental rates and have good margins. Contractuity costs have stabilised at pre-pandemic levels. We have to bring growth and we do it,” he concluded.
The company will soon start the second project in the vicinity of Berlin – MLP Spreenhagen and the construction of the first urban logistics and business project on the Austrian market MLP Business Park Vienna. Many further projects are being prepared, which it intends to launch in the coming periods, including the German market in Idstein and Gelsenkirchen, the purchase of further plots in Hesse and the Rhine-Westphalia region, and on the domestic market in Zgorzelec, Poznań or Lodz.
MLP Group is the developer, owner and manager of logistics and industrial parks as well as business parks for light industrial production operating on the Polish, German, Austrian and Romanian markets. The company has been listed on the WSE since 2013. Its consolidated revenues amounted to PLN 279 million in 2022.
Source: MLP Group and ISBnews
