Wrap Text
Reviewed condensed consolidated interim financial results for the six months to 31 December 2025
MAS P.L.C.
Registered in Malta
Registration number: C99355
JSE share code: MSP
ISIN: VGG5884M1041
LEI code: 213800T1TZPGQ7HS4Q13
(MAS, the Company or the Group)
SHORT-FORM ANNOUNCEMENT: REVIEWED CONDENSED CONSOLIDATED INTERIM FINANCIAL RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2025
INTRODUCTION AND BACKGROUND
MAS currently owns and operates directly held commercial income-producing properties across three countries in
Central and Eastern Europe (CEE). In addition, the Group deploys capital into commercial and residential development projects held indirectly
through the Development Joint Venture (DJV1) in CEE with co-investor and developer Prime Kapital.
The Group remains focused on maximising sustainable long-term value creation on a per share basis, while maintaining a prudent risk profile and
moderate to low leverage.
As outlined in the strategy and dividend policy update of 10 October 2025, MAS will continue to pursue compelling investment opportunities
within its existing markets, while progressively and selectively broadening its investment mandate beyond traditional real estate and beyond
the geographies in which it has operated to date. Capital allocation will be disciplined and opportunity-led, with deployment directed to
those investments that are expected to generate superior risk-adjusted returns over the long term. Any expansion beyond the Group's current
core markets will be undertaken incrementally and only when the Board is satisfied that adequate investment and management expertise,
governance capacity and risk controls are in place.
Dividends are not expected to constitute a primary use of capital. The Group intends to retain and reinvest capital where attractive
opportunities exist. A return of capital to shareholders will be considered only where the Company is unable to identify investments that meet
its return and risk thresholds. Share repurchases may represent an attractive form of capital deployment where the Company's shares trade at
a meaningful discount to intrinsic value; however, buybacks will be prioritised only where they are demonstrably superior to alternative
investment opportunities and with due regard to their impact on balance sheet scale and flexibility.
Consistent with this capital allocation framework, distributable earnings per share is no longer regarded as the most relevant measure of
performance. The Group has adopted total shareholder return (TSR) per share as its primary profitability metric. TSR per share is calculated as
the trailing twelve-month growth in adjusted net asset value (NAV) per share (plus any per share payments made to shareholders during the period,
if any) expressed in eurocents per share. The Board believes that TSR per share more appropriately aligns management performance measurement with
long-term shareholder value creation.
Unless otherwise stated, amounts included in this commentary are presented with reference to International Financial Reporting Standards (IFRS).
FINANCIAL RESULTS
The Group currently generates returns from: (i) directly-owned income property and operations in CEE (and one legacy property in WE the sale of
which is under way); (ii) other investments, including Central and Eastern European investments with Prime Kapital in DJV (including equity-accounted
earnings from its proportion of completed DJV-owned income properties, net results of residential sales and development activities), and
(iii) other elements disclosed as Corporate.
The Group's net asset value on 31 December 2025 amounted to 181 eurocents per share, compared with 169 eurocents per share on 31 December 2024.
TSR per share for the twelve months to 31 December 2025 was 7%, supported by underlying earnings generated during the period and the accretive
effect of share repurchases executed over the last three months of the year.
Notwithstanding the continued growth in NAV per share, the Group's financial results for the period were materially lower than those achieved in
the comparative period. This reflects a combination of factors that are discussed in detail below and which affected reported IFRS earnings.
MAS recorded earnings of EUR11.6million for the six months to 31 December 2025, compared with EUR76.1million for the six-month period to
31 December 2024. On a per share basis, earnings amounted to 1.97 eurocents, compared with 12.01 eurocents per share in the comparable period.
The Group's weaker IFRS earnings for the current period relative to the six months ended 31 December 2024 (comparable period) is primarily
attributable to the following factors:
(i) Moderation in consumption dynamics. A softer trading environment prevailed in Romania, which is the primary contributor to like-for-like
passing net rental income (NRI) growth of 2.4% for the Group's directly owned CEE properties (compared with 7.3% in the corresponding prior
period). Although rental growth remained positive, the moderation in consumption trends resulted in a more measured increase in the fair
value of the Group's directly owned CEE investment properties relative to the comparable period.
(ii) Disposal of the Strip Malls portfolio. The sale of the Strip Malls in January 2025 resulted in the reinvestment of proceeds at returns lower
than those generated by the disposed assets, thereby reducing earnings contribution relative to the comparable period.
(iii) Flensburg Galerie fair value adjustment. The carrying value of Flensburg Galerie was reduced following the Group's commitment in December 2025
to conclude its disposal at a price below the property's 30 June 2025 book value, resulting in a negative fair value adjustment during
the period.
(iv) Loss attributable to ordinary shares in DJV. MAS recognised a loss from its ordinary shareholding in DJV for the period (after elimination of
impact from cross shareholding) and accordingly the Group's attributable share of earnings from DJV declined relative to the comparable period.
This was primarily due to:
- higher finance costs arising in DJV from additional secured debt drawn during the six months to 31 December 2025, including funding raised in
connection with DJV's voluntary bid to acquire shares in MAS not already owned;
- a higher proportion of development margin and preferred share coupon being expensed by DJV in the period, reflecting lower levels of active
development (whereas in prior periods a significant portion of such costs was capitalised); and
- materially lower investment property valuation gains relative to the comparable period, when completions and associated revaluations were
more significant.
These effects were partly offset by an increase in DJV's NRI, supported by Mall Moldova being operational for the full six-month period to
31 December 2025 following its opening in April 2025.
(v) Higher corporate and investment-related expenses. Corporate costs increased due to a higher level of corporate activity and transaction-related
expenditure associated with asset disposals and broader strategic initiatives undertaken during the period.
The above factors were partially positively offset by an increase in preferred equity income from DJV resulting from the timing of drawdowns and the
partial redemption of preferred shares in October 2025, and decreases in current and deferred taxes during the six months to 31 December 2025.
OPERATIONS
Information regarding MAS' Central and Eastern European directly owned assets' like-for-like (LFL) footfall and tenants' sales (compared to the same
period in 2024) and collection rates for the six months to 31 December 2025 is detailed in Table 1. All figures were reported on 17 March 2026.
Table 1
Jul 25 Aug 25 Sep 25 Oct 25 Nov 25 Dec 25 Total
Footfall (2025 compared to 2024) % 99 99 94 99 96 97 97
Open-air malls % 98 98 92 99 96 96 97
Enclosed malls % 99 101 99 100 95 99 99
Tenants' sales per m2 (2025 compared to 2024) % 104 104 98 104 98 100 101
Open-air malls % 106 103 97 102 99 98 100
Enclosed malls % 101 104 100 106 97 103 102
Collection rate % 99.8 99.8 99.7 99.8 99.9 99.9 99.8
Consumption in the Group's largest market, Romania, moderated during the period, with trading conditions further impacted by the increase in the
standard VAT rate from 19% to 21% effective 1 August 2025. Footfall across MAS' CEE properties for the six months ended 31 December 2025 declined
marginally, while tenants' like-for-like sales growth in Romania was subdued relative to the comparable period.
Subdued growth in tenants' sales combined with increased rents led to a modest increase in occupancy cost ratios to 10.9% (excluding certain tenant
categories: supermarkets, DIY stores, entertainment and services; 10.6% on 31 December 2024). The ratio remains well within sustainable levels by
regional standards and continues to support healthy tenant profitability. Collection rates remained excellent, and LFL occupancy of Central and
Eastern European assets slightly improved to 98.2% on 31 December 2025 (97.8% on 31 December 2024).
LFL Passing NRI of the Group's directly owned properties in CEE increased by 2.4% year-on-year, which is mostly attributable to rent indexation,
rental from overage (lower than in the comparable period) and aided by healthy base rent reversions during the period. Base rent reversions achieved
during the period were 9.2% above previous rental levels, applicable to expiries of EUR6.0million in the six months to 31 December 2025, compared
to 9.5% applicable to EUR7.2million for the six months to 31 December 2024.
ASSET DISPOSALS
During the financial year to 30 June 2025, Flensburg Galerie (Germany), MAS' last Western European asset, and Nova Park (Poland) had been
reclassified as assets 'held for sale' in MAS' consolidated annual financial statements, as part of MAS' strategy to efficiently recycle capital.
In December 2025, MAS contracted the disposal of Flensburg Galerie, at a sale price of EUR30.2million, equivalent to a 34% discount to the asset's
book value on 30 June 2025. Closing was subject to the customary German statutory pre-emption rights in favour of the local municipality.
All conditions have been fulfilled during March 2026, and closing will take place on 31 March 2026. On 31 December 2025, Nova Park no longer met the
relevant IFRS criteria for it to be classified as an asset 'held for sale' and was therefore reclassified as an income property asset. The Group
will continue implementing its strategy to efficiently recycle capital and will provide further updates on this matter when appropriate.
PROPERTY VALUATIONS
The overall EUR8.9million net income property fair value loss was the result of positive fair value adjustments of EUR7.0million to directly-owned
income property in CEE (1% LFL improvement compared to valuations on 30 June 2025) and a decrease of EUR15.9million in WE attributable to the
write down of Flensburg Galerie's book value to EUR30.2million on 31 December 2025, equating to its agreed sale price. Excluding the Flensburg
Galerie adjustment, valuation movements were modestly positive.
The valuation of MAS' (and DJV's) properties is determined biannually by external, independent professional valuers, with appropriate, recognised
qualifications and recent experience in the relevant location and property category. Valuations are primarily based on discounted forecast cash
flows and are therefore forward-looking. On a LFL basis, the weighted average unlevered discount rate for income property in CEE was unchanged
at 9.43% compared to valuations on 30 June 2025.
DEBT, COST OF DEBT AND LIQUIDITY
On 31 December 2025, MAS had EUR95.4million in cash and cash equivalents. During the six-month period, the Group concluded and drew down EUR45million
of secured debt, in a refinancing and top-up of a secured loan which was due in December 2025. In addition, MAS extended its EUR20million revolving
credit facility to November 2027, which was fully drawn on 31 December 2025. During October 2025, the Group repurchased at par, via public tender,
EUR120million in bonds issued by its subsidiary, MAS Securities BV. Thereafter, MAS exercised its clean-up call option and, in November 2025,
it redeemed the remaining bonds in advance of their maturity in May 2026. As a result, on 31 December 2025, the Group had EUR418.0million in
outstanding debt (bonds, secured and unsecured bank loans; EUR563.5million on 31 December 2024), and its loan-to-value (LTV) ratio was 21%
(25.6% on 31 December 2024).
MAS' weighted average cost of debt (WACD) for the period, improved slightly to 5.46% per annum (5.55% for the period to 31 December 2024).
Except for MAS' revolving credit facility, interest rates for all secured debt are hedged. The Group hedges its interest rate risk, typically via
interest rate caps, protecting against future increases in variable EURIBOR rates over loans' terms to maturity.
SHARE REPURCHASES
By 31 December 2025, MAS has repurchased 28,548,702 shares, representing 4.08% of the Company's issued share capital (excluding shares held in
treasury) at the date of the December 2024 Annual General Meeting when the general authority to repurchase shares was granted by shareholders.
The shares were repurchased at a weighted average share price of EUR1.0726, and execution was achieved via on-market transactions on the JSE,
in accordance with the general authority. The Group additionally holds 16,586,906 shares from previous share repurchases, currently held by a
subsidiary of the Company. All shares held in treasury are intended to be cancelled in due course.
FUNDING COMMITMENTS TO DJV
MAS has invested EUR394.1million in preferred equity and had an ongoing undrawn commitment to invest EUR75.9million in DJV preferred equity,
further to DJV redeeming the same amount of preferred equity in the six-month period to December 2025. MAS also had a requirement to provide DJV
with a EUR30million revolving credit facility, of which EUR28million was undrawn on 31 December 2025.
Irina Grigore
Chief Executive Officer
20 March 2026, Malta
1 DJV is an abbreviation for a separate corporate entity named PKM Development Ltd (PKM Development), an associate of MAS since 2016 with
independent governance. MAS owns 40% of PKM Development's ordinary equity (EUR20million), an investment conditional on it irrevocably undertaking
to provide preferred equity to PKM Development on notice of drawdown. By 31 December 2025, MAS had invested EUR394.1million in preferred equity
and had an obligation of EUR75.9million outstanding. In addition, MAS has committed to provide PKM Development a revolving credit facility of
EUR30million at a 7.5% fixed rate, EUR28million of which was undrawn on 31 December 2025. The balance of the ordinary equity in PKM Development
(EUR30million) was taken up by Prime Kapital in 2016 in cash. In terms of applicable contractual undertakings and restrictions, Prime Kapital:
(i) is not permitted to undertake real estate development in CEE outside of PKM Development until the DJV's capital commitments are fully
drawn and invested or 2030 (end of exclusivity period);
(ii) contributes secured development pipeline to PKM Development at cost;
(iii) takes responsibility for sourcing further developments, and
(iv) provides PKM Development with all necessary construction and development services via its integrated in-house platform.
FINANCIAL PERFORMANCE 31 Dec 2025 31 Dec 2024 % Change
Net Asset Value attributable to owners of the Group (EUR thousand) 1,193,189 1,162,670 2.62%
Net Asset Value per share (eurocents) 180.9 169.0 7.03%
Adjusted Net Asset Value attributable to owners of the Group (EUR thousand) 1,155,265 1,127,843 2.43%
Adjusted Net Asset Value per share (eurocents) 175.1 163.9 6.83%
Gross revenue (EUR thousand) 51,851 51,767 0.16%
Earnings per share (eurocents) 1.97 12.01 -83.60%
Headline earnings (EUR thousand) 21,898 30,070 -27.18%
Headline earnings per share (eurocents) 3.72 4.75 -21.68%
Closing number of shares in issue (excluding treasury shares) 659,715,269 688,045,349 -4.12%
MAS did not declare or pay dividends during the periods presented.
This short-form announcement is the responsibility of the Directors and is only a summary of the information contained in the reviewed condensed
consolidated interim financial statements released today, Tuesday, 24 March 2026. The Full Announcement is available on the JSE cloudlink at:
https://senspdf.jse.co.za/documents/2026/jse/isse/msp/MASHYFS26.pdf, and on the Company's website at: https://www.masrei.com/investors/financials.
This short-form announcement does not contain full or complete details, and any investment decisions by investors and/or shareholders should be
based on consideration of the reviewed condensed consolidated interim financial statements, as a whole. The condensed consolidated interim financial
statements have been reviewed by the Company's auditors, PricewaterhouseCoopers (Malta), who expressed an unmodified review opinion thereon.
For further information please contact PSG Capital, JSE Sponsor +27 010 978 2434
Date: 24-03-2026 07:09:00
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