MLP Group has been expanding its warehouse property portfolio at a stable pace. The Group’s strategic goal remains business expansion in Poland and Germany and further growth in Austria and Romania.
We consider our first-half financial results solid. The economic downturn caused by the pandemic had no major impact on our operations. We completed all projects on schedule, delivering almost 100,000 m2 of new space. We have also signed a number of reservation agreements to purchase new land for planned logistics parks in Poland, Germany and Austria. We continue to manage business as usual. Germany, which has quickly recovered after the lockdown, remains the priority of our international expansion programme. Germany is also the country where we posted the strongest growth in the value of our investment property,’ said Radosław T. Krochta, President of the Management Board of MLP Group S.A.
MLP Group posted net profit of PLN 121m for the first half of 2020, including PLN 8m for the second quarter alone. The growth in net profit for the first half of the year was chiefly driven by a PLN 151m gain on property revaluation. Given the revaluation gain recognised in the first quarter of 2020 (PLN +171m), the second quarter alone saw net profit fall by approximately PLN 19m quarter on quarter. Despite that, the Group’s net profit for the period was positive. As at the end of June 2020, MLP Group’s equity (net assets) stood at PLN 1.05bn, representing an increase of 12% over the end of 2019. Investment property rose 20%, to PLN 2.16bn, in the first six months of the year.
In the first half of 2020, the Group had running projects with a total area of nearly 219,000 m2. Facilities with a total area of approximately 100,000 m2 were completed in MLP Pruszków II (45,500 m2), MLP Wrocław (21,400 m2), MLP Gliwice (8,800 m2), MLP Poznań West (11,700 m2) and MLP Bucharest (10,500 m2). Overall, the Group offered almost 700,000 m2 of finished modern warehouse space at the end of June 2020. Total leased area (including in projects under construction and in the pipeline) increased to 744,000 m2. As at the end of the first half of the year, 120,800 m2 of space was in the construction or pre-construction stage. Currently, the total development potential of the land held is close to 1.3m m2. MLP Group owns land plots and has signed a number of reservation agreements to purchase new land for planned logistics parks in Poland, Germany and Austria (including in Gelsenkirchen, Cologne, and Vienna).
The warehouse market in Poland proved extremely resilient to economic shocks caused by the COVID-19 pandemic. The growth of e-commerce generated new demand for warehouse space. According to market data, 1.1m m2 of new space was completed in the first half of this year (up 9.6% year on year), with the total stock of warehouse space at 19.5m m2. ‘Our outlook for future periods is optimistic yet cautious. We intend to implement new projects relying mainly on lease contracts signed. We are also reducing the scale of speculative projects. We see strong growth potential in all the markets where we operate, but it is Germany that seems the most successful in returning to business as usual. We have reserved new land to develop further logistics parks,’ added Mr Krochta.
In keeping with its build & hold strategy, MLP Group retains completed logistics parks in its portfolio and manages them independently. All projects undertaken by the Group are distinguished by an attractive location of the logistics parks, application of built-to-suit solutions and support given to tenants during the lease term.
