Deutsche EuroShop: Preliminary figures for 2019 financial year as planned / Suspension of dividends for 2019 / Precautionary measure because of corona virus pandemic

• Revenue: €225.9 million (+0.4%)
• Improved financial result and positive tax effect compensate for negative valuation result
• Consolidated profit: €112.1 million (+41.2%)

Hamburg, 19 March 2020 - Based on preliminary figures, shopping center investor Deutsche EuroShop closed financial year 2019 with good operating figures that partially met or exceeded forecast. Consolidated revenue was up 0.4%, from €225.0 million to €225.9 million (forecast: €222 to 226 million). Earnings before interest and taxes (EBIT) decreased slightly (-0.8%) from €199.1 million to €197.5 million (forecast: €194 to 198 million).

Net finance costs (excl. measurement gains/losses) came to €-34.3 million after €-38.2 million the previous year, as interest expense fell. At €163.1 million, operating earnings before taxes (EBT excluding measurement gains/losses) were up 1.4% versus the previous year (€160.9 million) and exceeded the forecast (€159 to €162 million).

The remeasurement of our property portfolio resulted in measurement gains/losses of €-120.0 million (2018: €-58.3 million). Of this, €-94.2 million related to Group properties (2018: €-55.7 million) and €-25.8 million (2018: €-2.6 million) to investees recognised at equity. A slight increase in acquisition yields for shopping centers in Germany, higher investment in modernising and positioning the existing portfolio and changes to expected rental trends resulted in slightly lower real estate values on average (-2.9%).

Positive effects from tax reimbursements for previous years and the reversal of deferred taxes more than compensated for these negative valuation results. Consolidated profit increased from €79.4 million to €112.1 million (+41.2%).

Funds from operations (FFO) decreased slightly by 0.5% to €149.6 million, which represents FFO per share of €2.42 (forecast: between €2.40 and €2.44). However, EPRA earnings performed well because of the positive tax effects and rose 7.4% to €158.3 million (2018: €147.4 million).

EPRA NAV (Net Asset Value) as at 31 December 2019 was €42.30 per share, which was 2.0% down on last year (2018: €43.17).

The 2019 Annual Report with the final audited figures is scheduled to be published on 29 April 2020.

Implications of corona virus pandemic for ongoing business
Over the last few days, the authorities in a number of countries have ordered sweeping safety and quarantine measures to stem the spread of the virus. All centers in the Deutsche EuroShop portfolio are now affected.

In Germany, Austria, Poland, the Czech Republic and Hungary, governments have now decided that all shops nationwide must now remain closed unless they are needed for essential supplies. The closure orders are different across the different countries, but there are generally exceptions for food, drugstores, pharmacies, banking services and a limited number of other everyday products and services. Restrictions have also been placed on the catering sector.

Deutsche EuroShop rental contracts contain regular agreements on fixed minimum rent payments. However, more sustained loss of revenue because of temporary shop closures or general consumer reticence can have a negative impact on the financial situation of retail outlets. For Deutsche EuroShop, this increases the risk with respect to the fulfilment of contractual obligations by its tenants.

Deutsche EuroShop is constantly coordinating with ECE, the European market leader for shopping center management, which is commissioned with integrated asset management of the shopping center portfolio. For its part, ECE is in close cooperation with local authorities to ensure compliance with official requirements and with tenants in order to manage the situation through cooperation. In various countries, extensive government support programmes are being put in place to mitigate the negative impact of the pandemic. In Germany, these include loan schemes and improved access to short-term benefits and, according to media reports, a fund for rent and lease payments for small and medium-sized companies.

Based on the fact that the 2019 financial year went as planned, Deutsche EuroShop has sufficient liquidity to pay the dividends (previously proposed at €1.55 per share). However, the financial implications for the 2020 financial year of the continued spread and unpredictable duration of the corona virus pandemic cannot be quantified at this stage. The Executive Board will reassess the situation as soon as it has more concrete information. To further improve the company's financial flexibility in this extraordinary situation, the Executive Board has therefore decided, as a precaution, to propose the suspension of the dividend payment to the general assembly (scheduled for 16 June 2020). There are no plans to amend the dividend policy on a general basis.

Webcast of the teleconference
Deutsche EuroShop will hold a conference call for analysts in English at 10 a.m. on Friday, 20 March 2020, which will be transmitted as a live webcast at www.deutsche-euroshop.com/ir

Deutsche EuroShop - The shopping center company
Deutsche EuroShop is the only public company in Germany to invest solely in shopping centers in prime locations. The SDAX-listed company currently has investments in 21 shopping centers in Germany, Austria, Poland, the Czech Republic and Hungary. The portfolio includes the Main-Taunus-Zentrum near Frankfurt, the Altmarkt-Galerie in Dresden and the Galeria Baltycka in Gdansk, among many others.

Explanations of the financial ratios used can be found at www.deutsche-euroshop.de/Investor-Relations/Service/Glossary/Glossary-210