Hili Properties Chairman praises ‘solid performance’ with €6.1 million profit before tax

Hili Properties plc delivered a “solid performance” with €6.1 million profit before tax, according to the opening words by the chairman Pier Luca Demajo in the freshly released financial statements for 2024. 

The group maintained the same level of turnover and profitability, despite the fact that one property, the shopping centre in Dzelzevas Street, Latvia, was sold at the beginning of the year.

In February 2024, the group disposed of the Dzelzavas Shopping Centre in Latvia, a property acquired in 2015 and redeveloped into a modern shopping destination, realising the building’s value post-renovation. The decision to sell improved their capital structure and unlocked the value created since its opening, aligning with their long-term strategy to focus on high-quality assets. 

This helped strengthen their existing portfolio, generating €15.8 million in revenue compared to the €15.6 million in the previous year. 

The EBITDA for the year under review was €13.2 million (representing 83 per cent of revenues) as compared to €12 million (representing 77 per cent of revenues) in the previous year. The increase in EBITDA is attributed to one-off other operating income and a natural result of the efforts of the group to reduce expenses.

During the year, the group and the holding company declared and paid dividends amounting to €4.3 million to its shareholders.

A major milestone for this year was the full acquisition of MIRO, their flagship office in Romania. Having acquired a 75 per cent shareholding from the Romanian developer –  Speedwell, in 2022 – the full acquisition of the remaining 25 per cent has been a key target from the outset. 

According to the chairman, MIRO reached full occupancy last year following the successful completion of four new fit-outs and has welcomed new tenants: Biocodex, a leading French pharmaceutical company; Soler & Palau, a global ventilation systems manufacturer and distributer; Radio Zu, one of Romania’s most listened-to stations broadcasting live from MIRO; and Symmetrica, a tile paving manufacturer with significant market presence. 

Hili Properties also made headway on several projects in other markets. In Latvia, the medical centre on the second floor of the DOLE shopping centre completed its first full year of operations, contributing to increased footfall. They are now working on plans to add 5,000 square metres of leasable area at DOLE and the Stirnu shopping centre. Stirnu has secured a new major tenant and permits for an upcoming expansion are in progress. Both properties are held for sale expected to unlock value in the future. 

Closer to home, planning permission is now in hand to add another floor at their headquarters – the Nineteen Twenty Three office in Marsa, Malta.

“These developments highlight our commitment to improving our portfolio – expanding, upgrading, and ensuring our properties stay attractive, functional, and aligned with market needs,” Mr Demajo wrote. 

“Meanwhile, our leasing strategy continues to provide stability, with long-term agreements incorporating annual rent increases – both fixed and inflation-linked – ensuring that the majority of property-related costs, such as repairs, utilities, and insurance, are passed on to tenants.”

In line with this, their cost reduction plan helped reduce administrative expenses to €2.6 million from €2.9 million last year, leading to a profit before tax of €6.1 million. Notwithstanding this, with a bond repayment firmly in sight, they are keeping a close eye on their cash flow.

Even as elevated interest rates and cautious investor sentiment impacted global real estate activity, a proactive asset management strategy was maintained and by the end of 2024, and their portfolio was valued at €229 million across 22 investment properties, of which three investment properties having a combined value of €36.8 million have been classified as held for sale.

“Going forward, we will continue building on this momentum, pursuing selective investment opportunities that align with our long-term growth strategy,” the chairman wrote.

Mr Demajo thanked Hili Properties’ team, tenants, and partners.

Find the full financial statements for 2024 here.

Main Image: MIRO Office in Romania acquired by Hili Properties plc