Warehouses De Pauw

The call did not provide a full income statement or EPS print, but management repeatedly referenced the prior plan’s EUR 1.70 EPS outlook for 2027 and said the ARGAN deal should be broadly neutral to 2027 earnings, with about 3% EPS accretion starting in 2028 after synergies are captured. They also said portfolio results were almost flat, with slight negative revaluation in France, Germany, Luxembourg, and Romania, and that ERVs were flat year-to-date and expected to stay flat for the rest of the year. On capital structure, management said the transaction would be offset with EUR 250 million of disposals by end-2027, limiting the effect to about 1% on LTV and 0.3x on net debt to EBITDA, while maintaining a 90% normalized lease renewal rate expectation and a 97% to 98% occupancy target. Forward guidance also included normalized occupancy below 3% vacancy and a return to inflationary ERV growth from next year onward.

Joost Uwents struck an upbeat but disciplined tone, emphasizing that the company kept executing while management worked on a “unique” strategic project. He framed the business as increasingly capable of growing across countries and cycles, with operations, acquisitions, and asset rotations all progressing as planned. He also said the priority now is to close and integrate ARGAN, while continuing to build the platform toward 2030 in Germany, Spain, Italy, and elsewhere in core Western Europe.

Mickaël Hauwe focused on the mechanics of the ARGAN deal and the financial guardrails around it. He said transaction costs are expected to be around EUR 25 million, about EUR 10 million of synergies are expected by the end of next year, and the deal should be 3% EPS accretive in 2028 after a full year of integration. He also said the group has sufficient liquidity, the exceptional dividend is covered from ARGAN’s own resources before closing, and the planned EUR 250 million of disposals should keep leverage effects broadly neutral.

Analysts pressed on how the ARGAN acquisition would affect 2027 EPS, integration costs, capitalized interest, leverage, and disposals. Management replied that 2027 should not show meaningful EPS accretion because integration will take time, with the first full-year benefit expected in 2028; transaction costs will be expensed through P&L but filtered out for EPRA earnings; and leverage should remain broadly stable after the planned disposals. On leasing and valuation questions, management said lease renewals should normalize around 90%, occupancy should stay around 97% to 98%, Romania remains stable with no major change in competition, and the French vacancy issue is a temporary short-term dip that they expect to relet.