Three Rank Progress projects on their way

According to the developer’s Q3 2017 report, it is also set to start preparation work on a residential project in Wrocław. In order to reduce the group’s debt and provide financing for the project, the company intends to sell a number of its retail assets and plots.

“At this point the management board is not able to declare when the individual sales transactions will be finalised. The potential buyers are at different stages of the process,” reads the report.

At the end of Q3 2017, the group’s portfolio of functioning assets consisted of six shopping centres (in Legnica, Jelenia Góra, Chojnice, Grudziądz, Oleśnica and Krosno), one less than in Q3 last year after a centre in Świdnica was sold. Apart from assets in operation, the company holds 64.8 ha land bank with a market value of PLN 277.6 mln, which is designated for future development projects or to be sold on.

In Q3 2017 the Rank Progress group generated sales revenue of PLN 13.9 mln, down from PLN 25 mln in the same period a year earlier. Cumulatively its revenue amounted to PLN 49.7 mln, down from PLN 61 mln. The decline is the result of a single reduction of PLN 8.5 mln in Q3 2016 due to the sale of a property in Mielec and of the shopping centre in Świdnica. The vast majority of the revenue came from the lease of retail space in assets owned by the group. In Q3 the group generated a sales profit of PLN 3.2 mln, after earning PLN 13.1 mln a year earlier. Cumulatively in the first three quarters the sales profit amounted to PLN 11.4 mln, down from PLN 20.6 mln in 9M 2016.

The group recorded an operating profit of PLN 10.6 mln in third quarter, compared to a loss of PLN 2.8 mln in Q3 2016. This significant improvement in operating profit in Q3 has been attributed to the result for properties – PLN 8.1 mln compared to a loss of PLN 16.7 mln in Q3 last year. However, cumulatively the company suffered an operating loss of PLN 6.3 mln. The factor that was mostly responsible for the cumulative loss was the negative result for properties of PLN 15 mln. The group had a consolidated cumulative net loss of PLN 11.4 mln for the first nine months of the year, whereas last year it had enjoyed a profit of PLN 13.2 mln. Along with the factors already mentioned, this loss was also contributed to by a PLN 3 mln increase in operating costs.

At the end of Q3 the group had PLN 16.9 mln in cash in its bank account, PLN 10.8 mln of which is blocked, mostly due to the terms of loan agreements. Over the first three quarters, the company decreased its total liabilities by PLN 117.1 mln, mainly through the sale of the Świdnica shopping centre. The reduction in liabilities was due to the investment loan financing the Świdnica centre being taken on by the new owner together with the payment of the first instalment of a long-term loan amounting to PLN 35.5 mln provided by BOŚ. The financial leverage of the group decreased from 62 pct to 58 pct.