Lar España Real Estate SOCIMI, S.A.

LRE

ES0105015012

Commercial REITs

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29/02	Transcript : Lar España Real Estate SOCIMI, S.A., 2023 Earnings Call, Feb 29, 2024
29/02	Lar España Real Estate SOCIMI, S.A. Reports Earnings Results for the Full Year Ended December 31, 2023	CI

Lar España Real Estate SOCIMI S A : Quarterly results Q4 2020

February 25, 2021 at 09:05 pm IST

FY 2020 Full Year Report

INDEX

COVID-19 p.4

EXECUTIVE SUMMARY p.30

1.1 Lar España's response to the COVID-19 crisis p.6

- SGS Certiﬁcation p.8

1.2 Initiatives at our shopping centres and retail parks p.10

1.3 Shopping centres and retail parks opening p.26

2.1 Highlights 2020 p.32

2.2 Key Indicators Performance p.34

2.3 Main Milestones p.38

2.4 Portfolio at 31 December 2020 p.42

2.5 Key Indicators p.50

2.6 Business Performance p.52

ESG p.66

3.1 Commited to the Environment p.69

3.2 Contributing to Society p.72

3.3 Leaders in Governance p.75

CONSOLIDATED

FINANCIAL STATEMENTS p.78

EPRA Information p.96

SHARE PRICE PERFORMANCE p.110

4.1 Company Chart 31.12.2020 p.80

4.2 Consolidated Statement of Comprehensive Income p.82

4.3 Consolidated Statement of Financial Position p.84

4.4 Consolidated Statement of Cash Flows p.90

4.5 Grupo Lar fees as Lar España´s Manager p.92

4.6 Proposed Shareholder Remuneration p.94

4.7 Shareholder Return p.95

5.1 EPRA Earnings p.100

5.2 EPRA Net Asset Value Ratios p.101

5.3 EPRA NIY and EPRA "topped-up" NIY p.106

5.4 EPRA Vacancy Rate p.108

5.5 EPRA Cost Ratios p.109

6.1 Share price information and performance p.112

6.2 Analyst Recommendations p.113

7 8

EVENTS AFTER THE REPORTING PERIOD p.114

GLOSSARY p.118

COVID-19 p.4

1.1 Lar España's response to the COVID-19 crisis p.6

- SGS Certiﬁcation p.8

1.2 Initiatives at our shopping centres and retail parks p.10

1.3 Shopping centres and retail parks opening p.26

Shopping Centre / As Termas (Lugo)

1.1

Lar España's response to the COVID-19 crisis

Current Situation

From the moment the state of emergency was declared, Lar España set about designing an Action Plan to strengthen its approach to the COVID-19 pandemic. The Plan sets out a list of health and safety procedures to implement across all of the company's properties, in order to meet the various me-asures required by health authorities. The company also set up a process to monitor, adapt and continuously improve the Plan, to ensure it complies with all the measures requi-red across all shopping centres and retail parks owned by Lar España.

Lar España continued with its strong leadership by adapting the services oﬀered across its shopping centres and retail parks to constantly be on top of the shiﬅing legislation, stri-ving to ensure that tenants could remain open with as little disruption as possible, while complying with restrictions. This was achieved by launching new initiatives such as Clic-k&Collect and Click&Car. All of its shopping centres have also adapted to new capacity limitations, social distancing rules, ongoing customer engagement, and hygiene measu-res in record time.

Lar España reached out to the leading certiﬁcation com-pany SGS, to externally verify the designed protocols and implementation of such across all its properties. The company achieved positive results, ensuring that these pro-tocols are correctly implemented across all of the shopping centres and retail parks in its portfolio.

These measures evolved throughout the year to meet the changing requirements based on the evolution of the virus, along with the arrival of new safety measures, outlining on three main areas at all times:

Cleaning:

Increased security:

• Disinfection via nebulisation programme for all areas of all assets.
• Routine cleaning of commun areas, liﬅs and toilets.
• Ultraviolet disinfection on travellators and escalators.
• Multiple hand sanitizer stations.
• Stockpiling surgical masks.

• Capacity limitations in walkways and stores at real time using Shoppertrack technology.
• Queue management in stores in order to mantain social distance.
• Ongoing communication with the main retailers to coordi-nate protocols for the opening and operation of stores.
• Delimitation of traﬀic lanes to maintain safety distance.

Information:

• Physical and digital signage to remind visitors about safety measures.
• Real-time footfall tracking and up-to-date informa-tion on the websites and social media channels of each centre.
• Communication campaigns of these measures with the aim of transmitting them to the customer for their comfort and safety during their visit.

The extensive track record - with over 50 years of experience - of Grupo Lar, the ﬁrm that manages Lar España's proper-ties; a unique and distinguished business model in the Spanish real estate industry; and a senior management team with a wealth of experience. These factors have been crucial in the company's ability to react quickly and correctly to the COVID-19 pandemic, keeping any negative impacts on the company to a minimum.

Lar España beneﬁts from its solid ﬁnancial position, expertise in the retail sector and a constant drive for technological innovation, which have all played a fundamental role during the year. These factors, combined with a portfolio of prime pro-perties with outstanding potential and a continual improvement, place the company in a uniquely advantageous position.

SGS certiﬁcation

Over the course of 2020, the leading veriﬁcation company SGS certiﬁed the sanitisation and disinfection procedures that were implemented across all assets. Aﬅer receiving a favourable assessment for its protocols - with no issues at any properties - and following physical inspections to verify their implementation, there will now continue with monthly inspections to ensure that these processes remain in place. This clearly demonstrates the commitment and eﬀorts of Lar España to adapt to the current situation and ensure the safety of both its workers and all those who visit its shopping centres and retail parks.

These protocols include the hygiene recommendations imposed by the national authorities, as well as the health regulations in force in each individual autonomous region. The inspection covered three key areas:

Compliance with all regula-tions and best practices to be included in the design and draﬅing of all protocols.

The implementation of all proce-dures and best practices across all shopping centres in the com-pany's portfolio.

Continued application of all me-asures in the months following the health crisis.

The SGS seal of approval and certiﬁcation verify that the shopping centres and retail parks adhere to the highest health and safety standards, both for customers and em- ployees. This project redeﬁnes and expands upon the requi-red hygiene protocols, certifying that these spaces are clean, safe and reliable, thereby reaﬀirming strict compliance with the latest regulations, and conﬁrming Lar España's unwa-vering commitment to safety and prevention.

These are also dynamic and ﬂexible measures, constantly being adapted to the speciﬁc health and social require-ments of the autonomous regions where each centre is lo- cated. These changes have also been duly certiﬁed and au-dited by SGS, allowing Lar España to oﬀer its customers peace of mind, with a safe space to go shopping.

Employee COVID-19 protocol

Since the state of emergency was announced on 14 March 2020, all professionals working at Lar España and Grupo Lar have put protocols in place for their teams to minimise the risk of infection as much as possible, allowing their emplo-yees to carry out most of their work remotely. These teams have been provided with the right tools, devices and techno-logy to allow them to continue carrying out all their work and daily tasks as usual. Attendance in person across our main oﬀices and shopping centres has been reduced to the abso-lute minimum, and strict safety measures have been imple-mented for any employees who do have to attend their usual place of work.

To implement this, the company designed safety and hy-giene protocols, approved by the leading certiﬁcation com-pany Applus. These protocols include speciﬁc rules for em-ployees to follow, as well as the installation of multiple hand sanitiser dispensers in all workspaces and daily temperature checks for everyone who enters the premises.

Workspaces are now deep cleaned more regularly, more ﬂexible working hours have been introduced, employees have been given preventative training and workstations have been spread out to ensure correct social distancing in the workplace.

1.2

Initiatives in our shopping centres and retail parks

Over the course of 2020, Lar España conducted numerous social welfare campaigns at its shopping centres and retail parks, in many cases to minimize damage done by COVID-19. These actions reﬂect their commitment to the communities they serve, as well as public institutions and non-proﬁt organisations. Some of its most notable initiatives include:

• Food banks
• Child food grants
• Christmas giﬅ donations
• Blood drives
• Collaboration with various organizations and local solidarity associations

The shopping centres and retail parks in the portfolio have never lost sight of their impact on their surrounding area, cons- tantly striving to have a positive eﬀect on local communities and creating shared value through their work. Although Lar España's properties have always strived to support local communities, the pandemic has prompted the company to carry out even more charitable or philanthropic work.

Here is a closer look at some of the social welfare initiatives carried out at a corporate level and at an asset level at our shop-ping centres and retail parks over the last quarter of 2020: 10

At a corporate level:

Collaboration with Cáritas

As part of its unwavering commitment to helping local communities during the COVID-19 pandemic, Lar Es-paña Real Estate has teamed up with Cáritas, supporting them in their project to help the most vulnerable fami-lies hit the hardest by the pandemic. The main aim of the project is to improve living conditions for the commu-nities in the surrounding areas of Lar España's main pro-perties. This project will also allow our shopping centre teams and employees the chance to get involved in this charitable work.

Collaboration with Aladina Foundation

The Aladina Foundation is a Spanish non-proﬁt organi-sation that helps and provides support to child and adolescent cancer patients and their families. In co-llaboration with the Altamira Lar Foundation, Lar España is working on an ambitious project, to fully refurbish the rooms at the children's cancer ward at Hospital Virgen del Rocío (Seville), one of the leading cancer hospitals in

Spain. The project has referred to as "a new unit, ﬁlled with colour and joy for children and adolescents with can-cer in Seville".

The donation was for an amount of €150,000, and will be chanelled via the Albacenter, Portal de la Marina, Ánec Blau, Megapark Barakaldo, As Termas, Las Huertas, El Ro-sal, Txingudi, Lagoh and Gran Vía de Vigo shopping cen-tres and retail parks.

This initiative with Cáritas is just one of many chari-table and social campaigns promoted by Lar España's shopping centres and retail parks since the state of emer-gency was announced, helping to support the most vulne-rable in our communities with food donations, healthca-re equipment, technology and child food grants, among other actions.

At an asset level:

ALBACENTER (Albacete)

Collaboration with Lassus Association

Albacenter shopping centre oﬀered a space free of charge to Lassus, a non-proﬁt health and social association, whe-re they sold poinsettias over the Christmas season to rai- se money to support the ﬁght against depression. They were supported in their endeavours by Globalcaja, a local bank in the Castilla-La Mancha region.

Collaboration with Amiab Association

The shopping centre oﬀered a space free of charge to the

Amiab association, where they distributed charity calen-dars to raise awareness of the outstanding work they do.

The Association runs Occupational Centres and oﬀers a

Training Service, providing the tools that people with in-tellectual disabilities (ID) need to conduct themselves in a social and working environment and their local commu-nity, as a way of boosting their personal, occupational and social independence.

Collaboration with Acepain Association

The shopping centre teamed up with the non-proﬁt asso-ciation Acepain, which helps to fund cancer research. The centre oﬀered the Association a space free of charge, where it sold calendars and masks to raise money to support the ﬁght against cancer.

Shopping Centre / Gran Vía (Vigo)

LAGOH (Seville)

"Make a wish" post office

A space was allocated at Lagoh shopping centre for the

"Make a wish post oﬀice", where customers spending €20 or more at the centre, could make a charitable wish to dona- te a giﬅ to someone in need, which would then be granted thanks to retailers at the centre and other local charities.

Arts and Crafts market at Lagoh

Over the ﬁnal months of 2020, the shopping centre hosted an arts and craﬅs market, held in association with the Sevi-lle Trade Federation, in a bid to promote local businesses in Seville.

ANEC BLAU (Barcelona)

EL ROSAL (León)

Enjoy a meal on us

Given the restrictions placed on restaurants in Catalonia due to the COVID-19 pandemic, in an eﬀort to help out lo-cal businesses, the shopping centre gave out €5 coupons to all customers spending €30 or more, valid for meals at any restaurant in the centre.

Blood Drive

El Rosal raised awareness about blood donation via posts on social media, signage around the shopping centre, and by oﬀering a space to recruit blood donors.

At a time when demand for transfusions remains high, but lockdown and the risk of catching the virus has put oﬀ do-nors, the centre has promoted blood drives to reach a wi-der audience. The centre has allowed locals to come to the centre, while observing capacity limitations, social distan-cing and hygiene measures, encouraging them to donate by oﬀering a free cinema ticket to every donor.

AS TERMAS (Lugo)PORTAL DE LA MARINA (Alicante)

Food Bank collections

The centre collected bibs for the "Corre con Nós" race and donated 1 kg of food for every bib, which was then given to the local Food Bank.

Charity Space

In its longstanding commitment to charitable organisa-tions, Portal de La Marina shopping centre allocated a space free of charge for the United Nations High Com-missioner for Refugees (UNHCR). This organisation helps to protect refugees and people who are displaced due to persecution or conﬂict, as well as promoting long-lasting solutions to these problems.

GRAN VÍA (Vigo)

Disfruton gift wrapping

Over the Christmas period, it was launched a new and ex- clusive giﬅ-wrapping service at the Disfrutones Club (Enjoy-ment Club) in Gran Vía de Vigo. Every customer at the cen- tre could have three giﬅs wrapped for free, simply by being Club members and spending €40 or more on their shop-ping. This service was provided in collaboration with the San Rafael de Vigo School, and every customer was given a wooden Christmas decoration, handmade by children at the school, in return for a donation.

"A toy for every child" Charitable campaign

For the third consecutive year, Gran Vía shopping centre took part in this wonderful initiative organised by the local Stop Association. A space was allocated at the centre for charitable donations of toys, which were giﬅed to disad-vantaged children at the end of the campaign. This was the only physical donation point in Vigo. A monetary donation was also given to the Stop Association, which helps people who suﬀer discrimination due to physical or mental illness.

MEGAPARK (Barakaldo)

Collaboration with the NGO "Hay una esperanza en ti"

Since May, Megapark has have been working closely with the local NGO "Hay una Esperanza para ti", which helps disadvantaged families in Barakaldo by providing them with food and essentials. Megapark Fashion Outlet tea-med up with them by hiring the van it uses twice a month to do its drop-oﬀs.

Christmas gift donation

This year, the centre continued the initiative started back in 2016, donating Christmas giﬅs to the childrens' ward at the Hospital Universitario de Cruces in Barakaldo.

These giﬅs were delivered on 21 December in person, as it has been done every year, at an informal meet and greet at the hospital, with the heads of each unit, thanking them for their work and discussing the situation of the hospital, as a way of helping the hospital with its humanisation strategy.

Contact with tenants

During 2020, the company has kept in constant contact with all of its tenants, dealing with every situation directly or through their managing agents, allowing it to quickly reach agreements tailored to each and every tenant and business case. These agreements were primarily reached under terms and conditions that involved a signiﬁcant commitment from both sides, helping to strengthen our bond with retailers and building long-term and stable lease agreements at all of the shopping centres and retail parks.

At the end of 2020, Lar España has reached individuali-zed rental agreements with its tenants in relation to the restrictions imposed by the health crisis of COVID-19. In this manner, it is estimated a total impact for the company round to 22(*) million Euros in 2020. In line with applicable accounting legislation, these discounts will be reﬂected in the Company's income statement from the date the agree-ments are signed, apportioning the impact on revenue on a straight-line basis over the term of each lease agreement of between 6 and 7 years. Its negative impact on 2020 revenues amounted to €1.3 million.

As of 31 December, 90% of all rent payments had been re-ceived, reductions were made in overheads of 30% to 70% in shopping centres and retail parks for the months that they were partially closed.

Lar España boasts a consolidated roster of extremely diver-se, high-quality tenants. Its ten main tenants account for 34% of the company's rental income, while at 31 Decem-ber 2020 more than 64% of retailer leases had expiries be-yond 2024 and occupancy stood at more than 95%, close to full occupancy.

As of December 31th 2020, all of Lar España's shopping centres and retail parks were open and operational, with footfalls recovering to very healthy levels and all of the necessary safety measures in place and being observed. Lar

España beneﬁts from a premium collection of properties with high value-add that secures sustainable returns for sha-reholders. The total number of visits registered in the portfo-lio during the year was 63.9 million visits, which represents a decrease of 21.9% in Like for Like terms compared to those recorded in 2019. This evolution shows a greater recovery of the portfolio activity compared to the ﬁgures obtained by the Shoppertrak index whose evolution has stood at -33.7% compared to 2019.

In the large majority of cases, Lar España also fully owns its properties, aﬀording a complete control over decision-ma-king. This allows it to promote and implement measures and strategies eﬀiciently that meet the requirements of the market and its customers at all times.

(*) This amount includes the impact of the bonuses and discounts applied to the diﬀerent waves caused by the pandemic.

Innovating and keeping in touch with local communities

All shopping centres and retail parks have adopted nume-rous measures and put multiple protocols in place to make them safer places to visit.

Safety and accessibility have always been a key concern for shoppers, which is why Lar España has strived to ensure that our properties are well prepared and designed to meet the exacting expectations of our customers, both in terms of hygiene and their piece of mind.

This is why our shopping centres have made making a ﬁrm commitment to local communities a top priority, with the COVID-19 pandemic making it more vital than ever for all of us to pull together and support businesses and the most vulnerable in society. In addition to the numerous charitable initiatives carried out so far this year, the shopping centres have developed long-term plans to reduce their environ- mental impact and play a deﬁning role in their respective communities.

DISFRUTONES CLUB (ENJOYMENT CLUB) APP LAUNCHED WITH BRAND-NEW FEATURES

Following the successful launch of its website on Septem-ber 21st on December 11th Disfrutones Club (enjoyment lo-yalty club) launched its new mobile app for Albacenter, As Termas, Gran Vía Vigo, Lagoh, El Rosal and Portal de la Ma- rina shopping centres. The app oﬀers members exclusive discounts at their local shopping centre, along with prize draws, services and the latest news from their shopping centre, right on their mobile phone, anytime, anywhere.

The app is the latest step in Lar España´s bid to digitalise the services we oﬀer our customers, as we look to build a digital community, and allow the shopping centre to have a new and direct line of communication with its visitors. To celebrate the launch and encourage customers to subscribe, we sent out promotors and set up signage around each cen-tre, as well as entering new users into a prize draw for down-loading the app, in tandem with a promotional campaign on social media.

A VARIETY OF NEW HYBRID EVENTS

Christmas videocall

The safety measures put in place to combat COVID-19 have meant that any physical events across our shopping centres and retail parks have had to be specially adapted. To cele-brate the launch of our Disfrutones Club app, the club mem- bers were oﬀered the chance to Make a reservation for a videocall with Santa Claus and the Three Kings via the app. Parents were able to give their phone number and arrange for Santa Claus or the Three Kings to call and talk to their children.

Fashion ecosystem

The fashion ecosystem is a series of events centred around fashion and held at our Albacenter, Lagoh and Gran Vía shopping centres, with the aim of ﬁrmly positioning each property as a focal point in their respective catchment areas, by transforming them into fashion and workshop spaces in partnership with Telva.

Each shopping centre held its own Masterclass event, where attendees had the chance to learn all the secrets behind one of the hottest professions right now, fashion editor. The workshop was followed by a guided shopping tour, led by one of Spain's top stylists and live streamed online, to showcase everything oﬀered at the fashion, accessories and beauty stores, explaining the diﬀerences between a variety of fabrics, concepts and trends.

One of the most fascinating projects was Inﬂuencia2, which included an online prize draw, set around fashion and the world of inﬂuencers. Each of the ten winners was given a giﬅ card to spend at the shopping centre.

LAGOH COLLECT

The shopping centre is oﬀering a collection service for all of its shoppers, as a way of avoiding large crowds and redu-cing in-store waiting times. Once customers have ﬁnished

shopping at a particular store, staﬀ at the centre will collect their order from the store and take it to the Lagoh Collect

point, where the customer can pick it up once they have ﬁ-nished shopping.

RELAUNCH OF TUCENTRO.COM

In a bid to collaborate further with our tenants following the COVID-19 restrictions and help to drive sales, we relaunched the online sales platform, tucentro.com, in July. Thanks to input from the retailers operating on the platform, we were able to digitalise every single one of their products, making

them available across multiple marketplaces aﬀiliated with tucentro.com, such as eBay and AliExpress.

ONLINE SHOWROOM

On October 29th the company launched the Lar España digital platform, which showcases a wide variety of products sold by diﬀerent retailers, with a special discount or oﬀer for members of the Disfrutones Club (Enjoyment Club), with direct access to the online store of each tenant on the platform.

This new section, which is available on the Disfrutones app, is just one part of our digital services strategy aimed at custo-mers and retailers, which aims to meet the following objectives:

• Boosting sales for tenants at the shopping centre, by attracting more visitors to their online stores when browsing the centre's digital platform.
• Building up the shopping centre's presence in the world of e-commerce.
• Rewarding loyalty for members of the Disfrutones Club.
• Expanding the number of retailers from the centre in the club, via speciﬁc products.

Currently 30 brands are taking part in the online showroom, with over 600 products on oﬀer.

Over 600

Participating brands

Products available online

1.3

Shopping centres and retail parks openings

As stipulated by the Spanish Government following the announcement of the State of Emergency on 14 March, our shopping centres and retail parks reopened in accordance with the phases established in each autonomous region. Since reopening, and as the pandemic has evolved over the last few months, businesses have continued to adapt to the new restrictions and limitations implemented by each autonomous region.

As of 31 December, all of our shopping centres and retail parks were open and operational and each and every one com-plies with the potential restrictions set out by each autonomous region.

In addition, during the fourth quarter of 2020, a number of leading chains opened stores at some properties, such as:

Dockers and Zero Latency RP MEGAPARK

Opening 15/12/2020

Vive la fruta and Belros SC ÁNEC BLAU

Flipa Jump SC EL ROSALCepsa

SC LAGOH

Opening 01/12/2020

Bedland

SC PORTAL DE LA MARINA

Carl´s JR

RP VIDANOVA

Opening 24/11/2020

Opening 11/12/2020

Following the advance of the pandemic in Spain, as of the date of this report, the shopping centres and retail parks of the portfolio have adapted to the restrictions imposed according to the Regional Governments in each of the Autonomous Com-munities.

The following map shows the percentage of area over the total area occupied that is open and operational as of 21 February 2021.

• Severe restrictions: Could result in the closure of all non-essential stores. Depending on the property, this could leave only 10-30% of the total GLA of each centre open. At present, only three properties fall into this category, and these comprise 15% of overall gross le-ttable area.
• Moderate restrictions: Could restrict opening hours for the whole centre and the clousure speciﬁcally for food and beverage. The entire gross lettable area of each property remains open. Five properties currently have restricted opening hours, covering 34% of gross leasable area.

• Minor restrictions: All stores operational. Additional sa-fety measures may be brought in during the pandemic that do not directly impact the portfolio, with only ope-ning time limitations. Seven properties in the portfolio currently falls into this category.

EXECUTIVE SUMMARY p.30

2.1 Highlights 2020 p.32

2.2 Key Indicators Performance p.34

2.3 Main Milestones p.38

2.4 Portfolio at 31 December 2020 p.42

2.5 Key Indicators p.50

2.6 Business Performance p.52

Retail Park / Megapark (Barakaldo)

2.1

Highlights 2020

Portfolio Information

GLA

WAULT

3.2

years

Financial Information

578,370

sqm

Average Cost of Debt

Dividend

2.2%

Recurring Proﬁt

27.5

Million € (0.31€/ share)

53.7

Million €

(1) Information based on valuations carried out by independent valuers on 31 December 2020. / (2) When analyzing this measure it is important to take into account the dividend paid in Q2 2020 (0.63€/share). / (3) The net LTV aﬅer 22 supermarkets portfolio divestment, would be 39.4%.

RETAIL PERFORMANCE

-36.9%

-25.2%

-22.4%

-19.8%

-20.5%

-40.0% -32.4%

Jun 20

Jul 20

Aug 20

Sep 20

Oct 20

Nov 20

Dec 20

Jun 20

Jul 20

Aug 20

Sep 20

Oct 20

Nov 20

Dec 20

Lar España (3)

Lar España(6)

Average Spanish Footfal(4)

(1) Ratio calculated according to EPRA recommendations / (2) Like for Like (excluding Lagoh shopping centre) / (3) Like for Like 2020 vs 2019 (excluding Lagoh, Ànec Blau and Megapark Leisure Area because is going through a comprehensive refurbishment project); accumulated ﬁgures at 31 December 2020: -21.9% Lar España footfall and -33.7% ShopperTrak Index / (4) ShopperTrak Index / (5) Declared sales / (6) Like for Like 2020 vs 2019 (excluding Lagoh, Ànec Blau and Megapark Leisure Area because is going through a comprehensive refurbishment project); accumulated ﬁgures at 31 December 2020 of total sales: -19.9%.

2.2

Key Indicators Performance

Performance of main economic and ﬁnancial result

Rental income obtained at the close of the ﬁnancial year was 93,324 thousand Euros, which means an increase of 15% versus the same period the previous year. Meanwhile, EBITDA amounted to 69,701 thousand Euros, which means an increase of 18% versus the same period the previous year, and the recurring net proﬁt reached 53,700 thousand Euros, which means an increase of 30% versus the same period the previous year.

Performance throughout the course of 2020 is shown in the following ﬁgure (amounts shown in thousands of euros):

53,578

Performance of main EPRA indicators

As regards the performance of EPRA Yields during 2020 and their comparison with the Reversionary NIY, one can see the notable proﬁ-

tability of Lar España's portfolio and the potential growth that the company could still obtain, thanks to the active management of the portfolio:

6.5%

6.6%

6.0%

5.9%

5.7%

5.3%

Reversionary NIYEPRA topped-up NIYEPRA NIY

5.9%

EPRA topped-up NIY 31.12.20

Although the EPRA Vacancy rate throughout the year it has been reduced in spite of the reforms that are being carried out in various assets of the portfolio and the situation caused by the COVID-19 crisis, closing at 4.5%. The following graph shows the evolution of the indicator in Like for Like terms during the year 2020.

5.0%

4.7%

4.5%

EPRA Vacancy 31.12.20

EPRA NAV per share 31.12.20 10.42 €/share(*)

EPRA Earnings per share +29%

vs 2019

The following ﬁgure shows the performance of the company's EPRA NAV. At 31 December 2020, the EPRA NAV stood at 881,376 thou-sand Euros (10.42€/share)(*).

Thousands of Euros

1,200,000

1,050,000

900,000

750,000

600,000

450,000

300,000

150,000

11.72

Q1 2020EPRA NAV

Q2 2020EPRA NAV/share

10.79

Q3 2020

Q4 2020

The following graph shows the change in the operating income ﬁgure (EPRA Earnings), which at the close of 2020 stood at 49,902 thousand Euros, an increase of 23% on the previous year. This is mainly due to the eﬀicient management of the assets held in the portfolio, along with some excellent sales and letting work.

Thousands of Euros 55,000 50,000 45,000

40,000

35,000

30,000

25,000

20,000

15,000

5,000

Q1 2020

EPRA Earnings adjustedQ2 2020

EPRA Earnings/share

(*) When analyzing this measure it is important to take into account the dividend paid in Q2 2020 (0.63€/share).

Q3 2020

Q4 2020

The performance of the EPRA Cost Ratio over the course of the year demonstrates Lar España's eﬀiciency in reducing the costs associated with operational management.

16.7%

14.5%

Q2 2020

Recurring EPRA Cost Ratio (including direct vacancy costs)Recurring EPRA Cost Ratio (excluding direct vacancy costs)

18.3%

15.7%

16.2%

13.5%

Q3 2020

Q4 2020

2.3

Main Milestones

2020

JANUARY.

MARCH.

14.01.2020

New Share Buy-Back Program

17.03.2020

Annual General Shareholders Meeting

A new share buy-back programme has been launched, with a maximum buy-back limit of €45 million. The maximum number of shares that the Company can buy back is 4,500,000 shares, equating to 5% of share capital. The buy-back programme has been implemented by JB Capital Markets, S.V., S.A.U., and has a maximum term of nine months.

28.01.2020

Registration of share capital reduction in the Company Registry

Lar España reported the registration of a public deed in the Madrid Company Registry, relating to a share capital reduc-tion via the cancellation of treasury shares granted on 20 December 2019. The Company reduced its share capital by €5,907,662 via the cancellation of 2,953,831 treasury sha-res, with a par value of €2 per share. Following the reduction, the Company's share capital stood at €175,267,460 equiva-lent to 87,633,730 shares, with a par value of €2 per share.

The Lar España Annual General Shareholders Meeting was held on 17 March 2020, to approve the agreements submitted for their consideration. It followed the emergency measures and recommendations of the Market Authority during the COVID cri-sis, and the meeting was streamed live online.

APRIL.

16.04.2020

Dividend

Following approval at the Annual General Shareholders Meeting, the shareholder dividend payment was distributed, amounting to a total of €0.63 per share.

SEPTEMBER.

OCTOBER.

07.09.2020

EPRA Gold Awards

On 7 September 2020, Lar España was awarded for the sixth year running with the Gold Award from the European Pu-blic Real Estate Association (EPRA) in recognition of the quality of the ﬁnancial information provided by the com-pany.

Lar España was also awarded for the third consecutive year with the most prestigious recognition from EPRA, the Gold Award, related to the information about ESG. This highlights the international recognition of the information reported by Lar España and made available to its shareholders.

2015

2016

2017

2018

2019

2020

14.10.2020

Extended Share Buy-Back Program

Lar España has informed the market of its additional six-mon-th extension to its third share buyback programme. The scheme was launched on January 14th and the maximum buyback was set at €45 million and a maximum of 4,500,000 shares, equating to 5% of the share capital.

27.10.2020

El Economista Investment Awards

On 27 October, Lar España was presented with the "Highest ear-ning non-Ibex dividend" award by El Economista newspaper. The award was accepted by Chairman of the Board, José Luis del Valle, at a ceremony where special safety measures were put in place.

NOVEMBER.

12.11.2020 2018 & 2019 Carbon footprint

16.11.2020

GRESB

Lar España has registered the Carbon Footprint generated by its activity during 2018 and 2019 in the Ministry for the Ecologi-cal Transition (MITECO) together with an Emission Reduction Plan, demonstrating a commitment to transparency and good practice with regard to sustainability. This allows the company to align with national and international reduction targets and conti- nue to collaborate in the ﬁght against climate change and mitiga-te the potential impact Lar España may have on the envirorment.

For the third year running, Lar España has taken part in the GRESB (Global Sustainability Real Estate Benchmark) assess-ment process, which has become the benchmark for assessing commitment to environmental, social and governance (ESG) is-sues in the real estate sector.

The score obtained represents an increase of 25% compared to the previous year, a percentage that rises to 50% if the score is compared to that obtained in 2018. This increase reﬂects the commitment that Lar España has always maintained with sus-tainability, with society and with the best practices of good go-vernance.

+25%

2020 vs 2019

+50%

2020 vs 2018

Shopping Centre / Ánec Blau (Barcelona)

2.4

Portfolio at 31 December 2020

Shopping Centres

1. Lagoh (Seville)
2. Gran Vía (Vigo)
3. Portal de la Marina + Hypermarket (Alicante)
4. El Rosal (León)
5. Ànec Blau (Barcelona)
6. As Termas + Petrol Station (Lugo)
7. Albacenter + Hypermarket and Retail Units (Albacete)
8. Txingudi (Guipúzcoa)
9. Las Huertas (Palencia)

Retail Parks

10. Megapark + Megapark Leisure Area (Vizcaya)
11. Parque Abadía and Commercial Gallery (Toledo)
12. Rivas Futura (Madrid)
13. VidaNova Parc (Valencia)
14. Vistahermosa (Alicante)

Other Retail

15.

Supermarkets Portfolio (22 units) (Cantabria, Basque Country, La Rioja, Navarra and Baleares)

Lagoh

Shopping Centre

Gran Vía

Shopping Centre

Portal de la Marina + Hypermarket

Shopping Centre

El Rosal

Shopping Centre

ASSET CHARACTERISTICS

Purchase Date

Acquisition Price WAULT

Ànec Blau

Shopping Centre

As Termas + Petrol Station

Shopping Centre

ASSET CHARACTERISTICS

Location

GLA Purchase Date Acquisition Price WAULT

Albacenter, Hypermarket + Retail Units

Shopping Centre

Txingudi

Shopping Centre

ASSET CHARACTERISTICS

Purchase Date

Acquisition Price WAULT

Las Huertas

Shopping Centre

Megapark + Megapark Leisure Area

Retail Park

ASSET CHARACTERISTICS

Location

GLA Purchase Date Acquisition Price WAULT

Parque Abadía + Commercial Gallery

Retail Park

Rivas Futura

Retail Park

ASSET CHARACTERISTICS

Purchase Date

Acquisition Price WAULT

ASSET CHARACTERISTICS

Location

GLA Purchase Date Acquisition Price WAULT

VidaNova Parc

Retail Park

Vistahermosa

Retail Park

ASSET CHARACTERISTICS

Location

GLA Purchase Date Acquisition Price WAULT

Supermarkets Portfolio

Other Retail

ASSET CHARACTERISTICS

Location

GLA Purchase Date Acquisition Price WAULT

Our retail portfolio at a glance

Dominant prime shopping centres and retail parks in their catchment area in relevant locations

# Assets

By size(*) (GAV)

578,370

GLA (sqm)

60.1%

20.6%

Large

Medium

(*) According to Spanish Association of Shopping Centres (AECC):

Occupancy (1)

14.6%

Very large

Very Large (>79,999 sqm) / Large (40,000-79,999 sqm) / Medium (20,000-39,999 sqm) / Small (5,000-19,999 sqm)

By geography (GAV)

ANDALUCÍABASQUE COUNTRYGALICIAC.VALENCIANA

7.9% 6.5% 4.5% 2.0%

OTHERS: Baleares 0.9% / Cantabria 0.5% / Navarra 0.4% / La Rioja 0.2%

By type (GAV)

Shopping Centres.

Retail Parks.

95.5%

4.0%

1,475

GAV (€M)

0.7%

Others

Small

C. LA MANCHAC. Y LEÓNCATALUÑA

MADRID

Other retail.

64.5% 31.5% 4.0%

OTHERS

Large

75% of our retail assets are classiﬁed as Large or Very

(1) Ratio calculated according to EPRA recommendations.

Centro Comercial / Lagoh (Sevilla)

Shopping Centre / Lagoh (Seville)

2.5

Key Indicators

+15%

Revenues vs 2019

+18%

EBITDA vs 2019

During 2020 Lar España generated revenues of 93,324 thousand Euros and a EBITDA of 69,701 thousand Euros, being the most relevant ﬁgures the following:

Revenues (Thousands of euros)

EBITDA

(Thousands of euros)

93,324 69,701

81,128 59,260

EBIT(*)

EBT(*)

(Thousands of euros)

(30,955)

(53,668)

99,297

79,628

Net Proﬁt(*)

(Thousands of euros)

(53,668)

80,730

2020

2019

(*)Recurring EBIT as of 31 December 2020 amounts to 76,670 thousands of euros, 25% higher than that registered the same period of the previous year.

Recurring EBT and Net Proﬁt as of 31 December 2020 amounts to 53,700 thousands of euros, 30% higher than that registered the same period of the previous year.

For more clarity as regards these ﬁgures, see the Consolidated Income of Financial Position.

The Group presents the following ﬁnancial indicators:

Working capital	Liquidity ratio	Solvency ratio
(Thousands of euros)	(%)	(%)

1.1 1.1

Net LTV(*)

ROE (%)ROA (%)

-3.14 4.70

31/12/2020 31/12/2019

At 31 December 2020, and 31 December 2019, the Group exhibited ratios related to liquidity (working capital and li-quidity ratio) with very high values, showing that the Group has suﬀicient liquidity and a high safety margin to meet its payments.

As at 31 December 2020, the ROE ("Return on Equity"),which measures Group's proﬁtability as a percentage of sharehol- ders equity, amounted to -5.92% (8.21% at 31 December 2019), whilst the ROA ("Return on Assets"), which measures the eﬀiciency of Group's total assets regardless of the sour- ces of ﬁnancing used, i.e. the ability of a company's assets to generate income, was -3.14% (4.70% at 31 December 2019).

(*) The net LTV aﬅer 22 supermarkets portfolio divestment, would be 39.4%.

2.6

Business Performance

Income Distribution

Rental income reached 93,324 thousand Euros during 2020 (versus 81,128 thousand Euros in the same period of the year before), which means an increase of 15% versus the same period the previous year.

The relative weigh of rental income by line of business at 31 December 2020 is as follows:

Rental Income by asset class 2020

63%

33%

SHOPPING CENTRES

RETAIL PARKS

The breakdown of income per asset type during 2020 is as follows:

Income by Shopping Centre (%)

Income by Retail Park (%)
14.1
Lagoh	Megapark + Megapark leisure area
5.7
Gran Vía de Vigo	Parque Abadía + commercial gallery
7.8	4.5
Portal de la Marina + hypermarket
7.6

16.9

El Rosal

6.3

Ànec Blau

6.0

As Termas + petrol station

4.4

Albacenter + hypermarketTxingudi

1.0

Las Huertas

10.6

Rivas Futura

4.2

VidaNova Parc 4.1

Vistahermosa

Income by Other Retail (%)

4.2

2.6

Supermarkets Portfolio

OTHER RETAIL

This graph details the breakdown of rental income per region for 2020:

Income per region (%)

18.8

16.9

16.6

16.0

10.2

8.6

6.3

BasqueCountryAndalucíaGaliciaC.ValencianaCastillaLaManchaCastillayLeón

4.6

CataluñaC.Madrid

0.9

Baleares

0.5

Cantabria

0.4

Navarra

0.2

LaRioja

Below are the ten tenants that have generated the most revenue during 2020:

% Total rental income

Gross annualised rents

The annualised GRI(*) of Lar España is detailed below, as well as the annualised GRI per occupied sqm at 31.12.2020:

Gross Annualised Rents

(Thousands of euros)

TOTAL SHOPPING CENTRES

GLA occupied

(sqm)Gross Rent (€/sqm/month)

62,192

296,282 17.5

TOTAL RETAIL PARKS

31,765

227,354 11.6

TOTAL OTHER RETAIL

3,966

27,909 11.8

TOTAL LAR ESPAÑA

Gross annualised rent / sqm occupied by asset class (€/sqm/month)

97,923

TOTAL LAR ESPAÑA

551,545 14.8

14.8

SHOPPING CENTRES

17.5

(*) The annualised GRI is calculated using the EPRA NIY of each asset.

RETAIL PARKS

OTHER RETAIL

11.6

11.8

Annualised GRI = annualised passing rental income from real estate investments + eﬀect of rent-free periods and temporary rental discounts.

Value of Lar España´s portfolio at 31.12.2020

As at 31 December of 2020, the total value of Lar España´s portfolio amounts to EUR 1,475 million:

GAV by asset class (%)

GAV reconciliation 31.12.2020 (millions of euros)

GAV 31.12.2019

1,551.5

Shopping Centres

2020

Retail Parks

Other Retail 56

GAV 31.12.2020

1,475.5

AcquisitionsChanges in valueDivestments

During 2020 Lar España has not carried out new acquisitions or divestments. The change in the fair value of investment pro- perties for an amount of €76 million corresponds to information based on valuations carried out by independent valuers on

31 December 2020, reﬂecting the impact of the pandemic crisis and the declaration of the State of Alarm.

Change LfL in the portfolio value at 31 December 2020 (*)

+46.9%vs purchase price

-4.9% vs December 2019

-2.0% vs June 2020

(*) Excluding CAPEX invested the percentages would be: +16.8%, -6.5% and -3.0%, respectively.

CAPEX

The company has continued revamping its portfolio of assets in order to generate more value, investing close to €25 million during 2020.

The breakdown of investment by asset class is as follows:

CAPEX investment (Thousands of euros)

Shopping Centres 15,745

Retail Parks 9,090

TOTAL 24,835

With an amount close to €13.1 million invested, Ànec Blau and Megapark assets have led the way in terms of retail investment.

Shopping Centre Ánec Blau (Barcelona) aﬅer the completion of part of the refurbishment works.

Lease expiration and WAULT

The proactive management carried out by Lar España allows us to have a solvent and diversiﬁed tenant base.

Renovations have been carried out at the properties occu-pied by our key tenants, thereby prolonging the lease terms, allowing us to have a signiﬁcant level of guaranteed mini-mum rents. During the year new long-term lease agreements have been signed with new tenants and negotiations has been carried out according to the current situation. We note that as of 31 December 2020, over 64% of all Lar España's active lease agreements have lease expiries beyond 2024.

Annual lease expiration (end of contract)

As at 31 December 2020, over 64% of retailer leases had expiration dates beyond 2024

2021

Shopping Centres

Retail Parks

Other Retail

Total Lar España

2022

2023

2024

>2024

Over 1,000 existing contracts

Thus, the WAULT(*) (weighted average unexpired lease term) at 31 December 2020 of Lar España's portfolio is 3.2 years.

Below you will ﬁnd the detail by asset class:

3.2

Lar España

2.9

Shopping Centres

2.9

Retail Parks

10.2

Other Retail

(*) Calculated as the number of years from the current date to the ﬁrst break option, weighted by the gross rent for each lease. The WAULT of each asset is detailed in section 2.4 "Portfolio at 31 December 2020".

95.4%

Occupancy (sqm)

The gross leasable area (GLA) of Lar España's income pro-ducing assets at 31 December 2020 stood at 578,370 sqm, whilst the average occupancy rate stood at 95.4%.

578,370 sqm Total GLA

The occupancy rate by asset class as at 31 December 2020 is shown below:

TOTAL LAR ESPAÑA

95.4%

SHOPPING	RETAIL	OTHER
CENTRES	PARKS	RETAIL
95.6%	94.5%	100.0%

Main milestones

The performance of the key indicators during 2020 is detailed below:

RETAIL

Key indicators evolution

Major operative milestones

During 2020 Lar España continued to actively manage its retail portfolio. It closed 108 operations including renewals, reloca-tions, relettings and new lettings, resulting in an annualized tenant rotation rate of 5% for the portfolio.

Number of operations sqm

25,658 sqm Rotated

6 million eurosNegotiated rent

Operations

108

Footfall 2020

Sales 2020

696.1 (3) Million €
Footfall indicator in our shopping centres LfL since reope-	Sales performance LfL since reopening 2020 vs same period
ning 2020 vs same period in 2019:	in 2019:
Monthly performance since shopping centres and retail parks	Monthly performance since shopping centres and retail parks
reopening aﬅer the ﬁrst lockdown	reopening aﬅer the ﬁrst lockdown

63.9 Million of visits

-8.5%

-8.0%

-6.5%

-4.1%

-7.6%

-25.8% -16.3%

-5.2%

-8.5%

-5.3%

-2.6%

-3.6%

-25.2%

-13.8%

-36.9%

-40.0% -32.4%

-25.2%

-22.4%

-19.8%

-20.5%

Jun 20

Jul 20

Aug 20

Sep 20

Oct 20

Nov 20

Dec 20

Jun 20

Jul 20

Aug 20

Sep 20

Oct 20

Nov 20

Dec 20

Lar España (1)

Lar España(4)

Average Spanish Footfall (2)

(1) Like for Like 2020 vs 2019 (excluding Lagoh, Ànec Blau and Megapark Leisure Area because is going through a comprehensive refurbishment project); accumulated ﬁgures at 31 Decem-ber 2020: -21.9% Lar España footfall and -33.7% ShopperTrak Index / (2) ShopperTrak Index / (3) Declared sales / (4) Like for Like 2020 vs 2019 (excluding Lagoh, Ànec Blau and Megapark Leisure Area because is going through a comprehensive refurbishment project); accumulated ﬁgures at 31 December 2020 of total sales: -19.9%.

Shopping Centre / El Rosal (León)

Some of the main operations during the period of 1 October and 31 December 2020 are detailed below:

Main operations

New lettings

Juguettos (265 sqm)

Bedland (300 sqm)

Renewals

Bershka (596 sqm)

La Costurera (20 sqm)

Main operations

Renewals

Nike (614 sqm)

Landed (193 sqm)

Under Blue (158 sqm)

Relettings

Dockers (157 sqm)

More than €245,000 annual negotiated rent 4 operations 1,181 sqm

More than €290,000 annual negotiated rent 4 operations 1,149 sqm

Main operations

Renewals

Springfield (323 sqm)

Cortefiel (668 sqm)

Women Secret (240 sqm)

More than €345,000 annual negotiated rent 5 operations 1,252 sqm

Main operations

New lettings

Milbby (268 sqm) at Rivas Futura Barelly (200 sqm) at Vidanova Parc

Maxcolchón (150 sqm) at Las Huertas

Renewals

Espaçao Casa (1.434 sqm) at Parque Abadía

Yves Rocher (135 sqm) at Gran Vía

More than €960,000 annual negotiated rent 24 operations 4,846 sqm

Retail Tenant Mix

Below we display the tenant mix of Lar España's retail portfolio at 31 December 2020 by space let. The food & beverage and health sectors account more than 20% of the retail oﬀering in Lar España's assets.

29.0%

18.4%

17.8%

Fashion

Home

Food & Beverage

14.7%

Leisure and Entertainment

6.6%

Dining

6.7%

Sports and Adventure

3.7%

2.8%

Services

Health and Beauty

0.3%

Culture, Technology and Multimedia

ESG p.66

3.1 Commited to the Environment p.69

3.2 Contributing to Society p.72

3.3 Leaders in Governance p.75

Shopping Centre / Portal de la Marina (Alicante)

ESG (Environmental, Social and Governance)

Lar España is aware of its impact on society, and therefore strives to improve people's quality of life, bolster socioeco-nomic progress in Spain and deliver a sustainable ﬁnan-cial return for its investors.

Its approach focuses on creating shared value. This is re- ﬂected in the company's sustainability policy, which was recently updated in Q4 2020. Lar España has also developed an ESG Master Plan to achieve its objectives in line with the most stringent, general and sector-speciﬁc environmental, social and corporate governance standards that meet its expectations in these areas. The objectives set out in that plan continue to guide the company's activity, and the com-pany made signiﬁcant strides forward in these areas du-ring the year.

Lar España's business sector embodies some of the most im-portant issues facing today's society: urban development, housing stock availability, designing sustainable cities, res-ponding to demographic changes and resource scarcity. This is why Lar España works transparently and proactively to promote active dialogue with a broad range of stakehol-ders on economic, social and environmental aspects.

Following the health crisis experienced this year and based on the open dialogue that the company maintains with its stakeholders, Lar España has also continued to remain com-mitted to focusing on creating shared value.

3.1

Commited to the Environment

Lar España promotes the responsible management of its properties and continually strives to improve their im-pact on the environment, while also safeguarding the eco-nomic viability and performance of its investments, which has led to it obtaining various certiﬁcates in recognition of its strong management practices.

Shopping centre data automation

During 2020, Lar España ﬁnished developing its automated platform to provide a dynamic visualisation and analysis of its utilities usage data (water and energy) at its shopping centres and retail parks, and on mitigating their environ-mental impact (waste management and controlling green-house gas emissions). The platform went live on 1 January 2021 and already contains consumption data recorded in 2020 and prior years. This will help to provide management departments with regular and uniform key data, as well as a powerful analysis tool that will help to optimise resour-ces. It will also allow for better control of expenditure and greater reactivity in implementing corrective mea-sures when necessary.

Over the coming quarters, the analytical capacity oﬀered by the data automation platform will enable action plans to be developed that improve property eﬀiciencies and will be a decisive tool in progressing towards achieving the sustaina-bility goals set out in Lar España's ESG Master Plan.

WATER

ENERGY

WASTE MANAGEMENT

GHG EMISSIONS

SALES/VISITS

AIR QUALITY

Energy Eﬀiciency Plan

Waste Management Plan

In Q4 2020, Lar España ﬁnalised its Energy Eﬀiciency Plan, and in so doing completed its sustainability strategy, the-reby aligning the company with national and international sustainability and energy eﬀiciency targets and expecta-tions. The aim is to achieve greater energy eﬃciency at its properties and to secure certiﬁcates to guarantee its environmental commitment and strive for global cultural change.

Following an internal and external assessment carried out in H1 2020, a roadmap for comprehensive waste manage- ment was created. Priority areas were identiﬁed, and the su-pervisory model to be implemented from January 2021 onwards was established, to ensure greater monitoring and supervision of data on waste collection and proces-sing. This data will be incorporated into the new automa-ted platform.

The plan's implementation hinges on a series of measures adopted in previous years that are now incorporated into and aligned with the corporate strategy across all the por-tfolio's assets. The company will therefore continue to lead by example and be a benchmark for the sector, as well as for society in general, by looking beyond the purely economic beneﬁts of better energy management and eﬀiciency.

The waste management plan is proof of Lar España's com-mitment to protecting the environment across all of its full business activities, and its contribution to the sustainable development of the company and of society as a whole. By implementing waste management and circular economy measures for all its operations and assets, the company is actively participating in the ﬁght against climate change, the prevention of pollution of the natural environment and the sustainable use of resources.

The plan covers aspects ranging from actions needed to op-timise the collection, transport and processing of waste, to the design of and participation in initiatives that promote the circular economy in accordance with the principles of reduction and reuse.

Carbon Footprint

BREEAM Certiﬁcations

Lar España registered its carbon footprint for 2018 and 2019 with Spain's Ministry for the Ecological Transition (MITECO), as part of Spain's national strategy (in line with European Union strategy). This registration demons-trates Lar España's commitment to transparency and good sustainability practices, as well as its commitment to a process that will lead to reducing its carbon footprint in the coming years.

National Level Certiﬁcation (Ministerio para la Transición Ecológica)

The company continues to work to combat climate change and the impact that its business may have on the environ-ment. The entire process was veriﬁed by AENOR, Spain's standardisation and certiﬁcation body, which reviewed all of the documentation submitted.

As part of this process, Lar España submitted its Emissions Reduction Plan as another step towards carbon neutrality, and a further aﬀirmation of the company's commitment to responsible and sustainable business operations.

Lar España remains committed to participating in assess- ment and certiﬁcation schemes to guarantee that the operation of all its properties is as sustainable as possible. For this reason, it has continued to work on the plan for the renewal of certiﬁcates obtained in previous years and on the improvement of qualiﬁcations in centres already cer- tiﬁed. Currently 100% of the company's shopping centres are BREEAM-certiﬁed with a "Good" or "Very Good" rating.

As part of this overhaul, the process of certifying the port-folio's retail parks has begun, with the aim of having all of these properties BREEAM-certiﬁed in 2021.

Lar España remains committed to participating in assessment and certiﬁcation schemes to guarantee that the operation of all its properties is as sustainable as possible.

100%

BREEAM Certiﬁed shopping centres

3.2

Contributing to Society

One of Lar España's key priorities is to have a positive social impact on the communities in which it does business. Its cu-rrent priorities are to further improve the indoor air quality of its properties, implementing the necessary measures to ensure accessibility for all customers, interacting with local organisations and creating shared value.

Collaboration with Cáritas

Collaboration with Aladina Foundation

As part of its unwavering commitment to helping local communities during the COVID-19 pandemic, Lar España has teamed up with Cáritas, supporting them in their project to help the most vulnerable families hit the hardest by the pandemic. The main aim of the project is to improve living conditions for the communities in the surrounding areas of Lar España's main properties. This project will also allow our shopping centre teams and employees the chance to get in-volved in this charitable work.

The Aladina Foundation is a Spanish non-proﬁt organisation that helps and provides support to child and adolescent cancer patients and their families. In collaboration with the Altamira Lar Foundation, Lar España is working on an ambitious project, to fully refurbish the rooms at the chil-dren's cancer ward at Hospital Virgen del Rocío (Seville), one of the leading cancer hospitals in Spain. The project been referred to as "a new unit, ﬁlled with colour and joy for chil-dren and adolescents with cancer in Seville".

The collaboration is valued at €150,000, and will be chane-lled via the Albacenter, Portal de la Marina, Ánec Blau, Mega-park Barakaldo, As Termas, Las Huertas, El Rosal, Txingudi, Lagoh and Gran Vía de Vigo assets.

This initiative with Cáritas is just one of many charitable and social campaigns promoted by Lar España's shopping centres and retail parks since the state of emergency was announced, helping to support the most vulnerable in our communities with food donations, healthcare equipment, technology and child food grants, among other actions.

Improved air quality

The health and well-being of visitors are key components of the company's business model. With this in mind, in 2020 work continued to improve air quality and regulate am- bient temperature inside the company's buildings:

• An invitation to tender was launched for air quality au-dits, to generate a database for each asset and to create performance methodologies that improve the current parameters.
• A pilot study has been carried out to analyse the eﬀec-tiveness of innovative indoor air quality treatment sys-tems at Parque Abadía.
• Temperature policy: all Lar España's properties comply with Spanish regulations on thermal equipment in buil-dings (RITE).

Lar España has joined the United Nations Global Compact, the world's largest enterprise sustainability initiative, to align its operations with the Ten Principles and work towards the

SDGs

Accessibility

Sustainable Development Goals

Lar España continues to be committed to social integration, maintaining high accessibility standards and seeking to obtain universal accessibility certiﬁcation at all of its proper-ties. The company strives to continuously improve accessi-bility standards at all its retail parks and shopping centres through people-centred design.

Lar España recognises its collective responsibility to achie-ve and promote the Sustainable Development Goals (SDGs), and has aligned its sustainability strategy with the Uni-ted Nations 2030 Agenda, which represents the interna-tional commitment to addressing the social, economic and environmental challenges of globalisation.

In the second half of the year, it successfully obtained uni- versal accessibility certiﬁcation under the UNE 170001 stan-dard accredited by AENOR at its Lagoh, El Rosal and As Termas properties, in addition to those already certiﬁed (Vistahermosa and Vidanova Parc). All renovation projects carried out also meet the required accessibility standards and best management practices.

100% of the portfolio audited for universal accessibility

In response to the ﬁrm position that maintains with the Sus-tainable Development Goals, the company has decided to join the United Nations Global Compact. This implies that Lar España is committed to aligning its operations with Ten Universally Accepted Principles in the areas of human rights, labour standards, environment and the ﬁght against corruption, and take action in support of the objectives of the United Nations currently set out in the Sustainable De-velopment Goals (SDGs).

The company has already made progress in the following ac-tions as a demonstration of their commitment:

7 assets of the portfolio currently undergoing the UNE-170001 certiﬁcation process

1. Identiﬁcation of the priority SDGs for Lar España:

• Promoting gender equality (SDG 5).
• Creating a positive impact on jobs by hiring local su-ppliers (SDG 8).
• Contributing to the creation of sustainable urban set-tings and communities (SDG 11).
• Promoting responsible production and consumption, helping to foster the circular economy (SDG 12).
• Action to combat climate change, signiﬁcantly redu-cing the GHG emissions of its organisation (SDG 13).
• Promoting partnerships for joint initiatives in favour of sustainable development (SDG 17).

These Sustainable Development Goals have been chosen because they correspond to the areas in which Lar España's business activity can be most eﬀective and relevant.

2. Promoting information and awareness for the adoption of the SDGs in government and in corporate policies.
3. Monitoring the actions carried out as part of the com-pany's activity to contribute to each of the SDGs identi- ﬁed. This information will be comprehensively included in the 2020 Annual Report.

SGS certiﬁcation

Following the COVID-19 health crisis, Lar España has de- signed speciﬁc operating protocols to ensure its shopping centres and retail parks can reopen safely, in complian-ce with all health and hygiene requirements. The operating protocols cover all issues required to guarantee the safety of workers and visitors.

The independent company SGS, leaders in inspection, veri- ﬁcation, testing and certiﬁcation, has veriﬁed the eﬀective-ness and validity of these protocols.

The inspection covered three key areas:

• Compliance with all regulations and best practices to be included in the design and draﬅing of all protocols.
• Implementation of all procedures and best practices across all shopping centres in the company's portfolio.
• Continued application of all measures in the months fo-llowing the health crisis.

Following the favourable assessment regarding the de-sign of the protocols, SGS carried out on-site inspections at the shopping centres to certify that all protocols were be-ing implemented correctly. These inspections will continue monthly throughout 2021, to verify that all the necessary protocols and measures are consistently adhered to at the diﬀerent assets within the company's portfolio.

3.3

Leaders in Governance

Lar España continues to make great strides in terms of transparency, ethics and regulatory compliance, guaran-teeing good governance both in terms of the company and its governing bodies.

Updating corporate policies

Health crisis COVID-19

During H1 2020, and due to the situation caused by the CO-VID-19 health crisis, both Lar España Real Estate SOCIMI and Grupo Lar, its management company, demonstrated their commitment to the business:

During the ﬁnal quarter of the year, the company's regu-lations and policies were updated in accordance with the latest recommendations published in the CNMV's Good Go-vernance Code.

The documents revised and approved by the company's Board of Directors include the Corporate Social Responsi-bility/ESG, Corporate Governance, Director Selection and Diversity and Communication Policies. The operating regu-lations of its committees and of its Board of Directors were also revised.

In turn, the company's SCIIF Manual has also been revised.

• Grupo Lar reduced the base fee that it charges.
• Lar España's Board of Directors decided to take a cut in their remuneration for 2020.

In addition, during the year 2020 the following recognitions of Lar España in relation to the main ESG indexes stand out:

GRESB

FTSE4Good Global Index

For the third year running, Lar España has taken part in the GRESB (Global Sustainability Real Estate Benchmark) assessment process, which has become the benchmark for assessing commitment to environmental, social and gover-nance (ESG) issues in the real estate sector.

Lar España therefore continues to strengthen its levels of transparency on ESG issues, having secured a 25% increase in its rating compared to the previous year, and an increase of 50% compared to its rating in 2018.

+25%

2020 vs 2019

+50%

2020 vs 2018

This signiﬁcant increase was made possible through the company's signiﬁcant work on ESG aspects, demonstra-ting Lar España's commitment to sustainability, society and good governance best practices. It also reﬂects the com-pany's desire to continue its responsible path to growth and to contribute to societal well-being and progress.

The company continues to work across a range of areas rela-ting to environmental sustainability to reduce its impact, promote the development of a sustainable economy and improve its capacity to adapt to climate change-related changes.

During 2020, the FTSE Russell Global Index kept Lar Espa- ña as a constituent on its FTSE4Good index, based on the results it obtained in the independent assessment of its ESG criteria by FTSE Russell. This conﬁrms Lar España's fulﬁl-ment of the requirements for being an index constituent, having demonstrated its strong environmental, social and governance practices.

The FTSE4Good index measures the performance of compa-nies' ESG practices by evaluating the information provided to their stakeholders. This index is used as a benchmark by a wide variety of investors and market participants when as-sessing responsible investments.

EPRA Gold Award 2015

2016

In September 2020, for the sixth year running, Lar España received the EPRA Gold Award in recognition of the quality of the ﬁnancial information it provided to its main stake-

holders. This is a clear example of the international acclaim 2017 enjoyed by Lar España's high-quality reports and sharehol-der communications.

In recognition of its information published on ESG, Lar Es-

paña was awarded the highest distinction by EPRA, winning 2018 the Gold Award for the third year running. This recognition is another step towards greater transparency in this respect.

Lar España is currently implementing its ESG Master Plan

that meets the most demanding sustainability standards, 2019 both in sector-speciﬁc and general terms; the recommenda-tions of the National Securities Market Commission (CNMV); its stakeholders' expectations; the Sustainable Develop-ment Goals (SDGs) and the company's business objectives

for the coming years. 2020

CONSOLIDATED FINANCIAL STATEMENTS p.78

4.1 Company Chart 31.12.2020 p.80

4.2 Consolidated Statement of Comprehensive Income p.82

4.3 Consolidated Statement of Financial Position p.84

4.4 Consolidated Statement of Cash Flows p.90

4.5 Grupo Lar fees as Lar España´s Manager p.92

4.6 Proposed Shareholder Remuneration p.94

4.7 Shareholder Return p.95

Shopping Centre / Ánec Blau (Barcelona)

4| CONSOLIDATEDFINANCIALSTATEMENTS

4.1

Company Chart 31.12.2020

At 31 December 2020, the consolidated ﬁnancial statements of the Group were presented in accordance with the accounting principles established in the International Financial Reporting Standards adopted by the European Parliament (EU-IFRS) up until this date.

The scope of the Group's consolidation is as follows:

100%

100%LE Retail Albacenter,

S.L.U.

LE Retail Txingudi, S.L.U.

LE Retail VidaNova Parc,

S.L.U.

Hiper Albacenter,

LE Retail

LE Retail Las Huertas,

S.L.U.

LE Retail Gran Vía de Vigo, S.A.U.

LE Logistic Alovera I y II,

S.A.U.

100%

AlbacenterTxingudiVidaNova ParcAlbacenter HypermarketLas HuertasGran Vía Vigo

Company.

Full Consolidation

Equity Method

For comparative purposes, the balances of the Consolidated Comprehensive Income Statement are shown together with tho-se for the same period the year before, whilst for the Consolidated Statement of Financial Position they are shown together with those corresponding to 31 December 2019.

100%

100%Lar España Inversión Logística IV,

S.L.U.

LE Retail Hiper Ondara, S.L.U.

LE Retail Rivas, S.L.U.

LE Retail Hipermercados

II,

S.L.U.

LE Retail Sagunto II,

S.L.U.

LE Oﬀices Marcelo Spínola 42, S.L.U.

LE Oﬀices Joan Miró 21,

S.L.U.

100%

Portal de la Marina hypermarket Megapark As Termas petrol station

Portal de la Marina

100%

Rivas Futura

7 supermarkets

Asset Class.

Shopping Centres & Retail Parks

Retail Units

Residential

4| CONSOLIDATEDFINANCIALSTATEMENTS

4.2

Consolidated Statement of Comprehensive Income

(Thousands of euros)

Revenues

Other income Personnel expenses Other expenses

Changes in the fair value of investment properties

Results of disposals of investments properties

RESULTS FROM OPERATIONS Financial income

Financial expenses

Share in proﬁt (loss) for the period of equity- accounted companies

PROFIT/(LOSS) BEFORE TAX FROM CONTINUING OPERATIONS

Income tax

PROFIT/(LOSS) FOR THE PERIOD

Recurring result from operations 76,670 thousand of euros +25% vs 2019

Recurring proﬁt forthe period

53,700

thousand of euros

+30% vs 2019

Result from operating activities

Change in the fair value of investment properties

As of 31 December 2020, the Group presented a positive recurring result for its operations amounting to 76,670 thousand Euros (61,375 thousand Euros at 31 December 2019) which means an increase of 25% versus the same period the previous year. Meanwhile, the recurring proﬁt for the period amounts to 53,700 thousand Euros, which means an increase of 30% versus the same period the pre-vious year.

The negative amount in this entry, 100,656 thousand Eu-ros, is made up of the diﬀerence in the fair value of invest-ment properties following the latest valuations conducted by independent experts (C&W and JLL) at 31 December 2020.

Net Financial Result

Revenues

Revenues during 2020 amounted to 93,324 thousand Eu-ros (revenue of 81,128 thousand Euros during 2019), which means an increasing of 15% versus the same period the previous year.

Other expenses

As at 31 December 2020, the Group incurred other expenses amounting to 26,715 thousand Euros, mainly related to:

• Recurrent services that are directly linked to the ordinary management of the assets (supplies, IBI -property tax-, etc.) in the amount of 8,291 thousand Euros.
• Management fees (ﬁxed fee included) for management services provided to the Company by Grupo Lar Inver-siones Inmobiliarias ("Grupo Lar") totals 8,496 thousand Euros, discounting indirect fees paid in subsidiary com-panies (1,028 thousand Euros) and other expenses incu-rred by Grupo Lar and paid by Lar España (170 thousand Euros). In addition, exceptionally, there has been a re-duction of 334 thousand Euros in the fees charged by the manager Grupo Lar during the second quarter of 2020, due to the crisis caused by the COVID-19 virus pandemic.
• Bad debt provision arising from the situation genera-ted by COVID-19 for an amount of 3,126 thousand Euros
(most signiﬁcant non-recurring expense).

The ﬁnancial result was a negative balance of 22,970 thou-sand Euros at 31 December 2020 (negative balance of 20,142 thousand Euros at 31 December 2019).

Financial expenses mainly comprises the interest accrued on loans taken out by the Group with ﬁnancial institutions and the bonds issued by the Group in February 2015.

4| CONSOLIDATEDFINANCIALSTATEMENTS

4.3

Consolidated Statement of Financial Position

Assets (Thousands of euros)	31/12/2020	31/12/2019
Intangible assets	2	2
Investment properties	1,373,480	1,449,344
Equity-accounted investees	1,082	5,100
Non-current financial assets	13,618	13,149
Trade and other receivables non-current	17,996	3,857
NON-CURRENT ASSETS	1,406,178	1,471,452
Non-current assets held for sale	106,755	103,790
Trade and other receivables	28,463	14,644
Other current financial assets	369	189
Other current assets	3,038	2,650
Cash and cash equivalents	134,028	160,527
CURRENT ASSETS	272,653	281,800

TOTAL ASSETS	1,678,831	1,753,252
TOTAL EQUITY AND LIABILITIES	1,678,831	1,753,252

Equity and liabilities (Thousands of euros)	31/12/2020	31/12/2019
Capital	175,267	175,267
Share premium	475,130	475,130
Other reserves	281,005	254,358
Treasury shares	(16,474)	(762)
Retained earnings	(53,668)	80,730
Valuation adjustments	(1,610)	(1,943)
EQUITY	859,650	982,780
Financial liabilities from issue of bonds and other marketable securities	139,685	139,376
Loans and borrowings	570,608	506,641
Deferred tax liabilities	17,201	17,201
Derivatives	4,685	2,846
Other non-current liabilities	19,993	19,593
NON-CURRENT LIABILITIES	752,172	685,657
Liabilities related to non-current assets held for sale	1,576	1,570
Financial liabilities from issue of bonds and other marketable securities	3,482	3,482
Loans and borrowings	40,593	41,127
Derivatives	3,137	2,393
Other financial liabilities	-	3,199
Trade and other payables	18,221	33,044
CURRENT LIABILITIES	67,009	84,815

Non-current assets

Investment properties

At 31 December 2020, investments properties are clas- siﬁed as non-current assets, at a fair value of 1,373,480 thousand Euros (1,449,344 thousand Euros at 31 December 2019), except for the shopping centres Las Huertas, Txingudi and the Eroski's hypermarkets amounting to 102,010 thou- sands Euros which is classiﬁed under "Non-current assets held for sale".

The Group´s investment properties, including the assets classiﬁed under "Non-current assets held for sale", consist of nine shopping centres, ﬁve retail parks and twenty-two retail units.

Net Investment (Thousands of euros)	31/12/2020	31/12/2019
INVESTMENT PROPERTIES (*)	1,475,490	1,551,564

Shopping Centres	952,250	1,018,143
Retail Parks	463,820	478,301
Other Retail	58,870	54,120
Others	550	1,000

(*) This amount includes Las Huertas, Txingudi and the Eroski's Hypermarkets investment properties for an amount of 102,010 thousand Euros, which has been reclassiﬁed to "Non-current assets held for sale"

Investment properties by asset class

65%

Shopping Centres

31%

Retail Parks

Other Retail

4| CONSOLIDATEDFINANCIALSTATEMENTS

Equity-accounted investees

As of 31 December 2020 and 31 December 2019, the amount reﬂects investment of 50% held by the Group in Inmobilia-ria Juan Bravo 3, S.L. that is accounted for using the equity method.

Current assets

Assets and liabilities held for sale

In addition, at 31 December 2020 the investee Inmobiliaria Juan Bravo 3, S.L. has repaid the shareholders contribu-tions from the Group, amounting to 4,275 thousand euros (corresponding to 50% of the Group's investment), thereby decreasing the value of the equity-accounted investment held by the Group. This repayment of shareholders contri- butions has not aﬀected the percentage of interest held by the Group held in said company.

At 31 December 2020 and 31 December 2019, this heading included the assets and liabilities of the company LE Retail Las Huertas, S.L.U., LE Retail Txingudi, S.L.U., LE Retail Hipermercados I, S.L.U., Hipermercados II, S.L.U. and LE Retail Hipermercados III, S.L.U., which were classiﬁed as held for sale as per IFRS 5. (*)

At 31 December 2020 assets and liabilities held for sale are as follows:

Non-current assets held for sale

(Thousands of euros)

Non-current ﬁnancial assets

At 31 December 2020 and 31 December 2019, the Group has recognised as non-current ﬁnancial assets mainly security deposits received from tenants, which the Group has depo-sited with the corresponding public bodies.

Investment properties Non-current financial assets Cash and cash equivalents Trade and other receivables

31/12/2020

102,010

1,102 3,365

278

TOTAL NON-CURRENT ASSETS HELD FOR SALE

106,755

Liabilities related to non-current assets held for sale

(Thousands of euros)

31/12/2020

Other non-current liabilities Other current financial liabilites

1,517

TOTAL LIABILITIES RELATED TO NON-CURRENT ASSETS HELD FOR SALE

1,576

(*) IFRS (International Financial Reporting Standards).

Net Equity

Trade and other receivables

As at 31 December 2020, this heading mainly reﬂects the outstanding invoiced income corresponding to the period comprised between March and December that are pending collection. Additionally it reﬂects the claims with public ad-ministration credits in the amount of 8,101 thousand Euros.

As of 31 December 2019, this heading mainly reﬂects claims on public administration credits amounting to 10,639 thou-sand Euros.

As of 31 December 2020, the Company's share capital con-sisted of 87,633,730 registered shares represented by book entries with a par value of 2 Euros each, fully subscribed and paid up, giving their holders equal rights.

On 17 March 2020, the General Shareholders' Meeting appro-ved the distribution of a maximum dividend of 55,000 thou- sand Euros or €0.63 per share (considering all outstanding shares) with a charge to 2019 proﬁt.

The total pay-out was 54,094 thousand Euros (aﬅer deduc-ting the amount corresponding to treasury shares, which does not leave the Parent Company's equity and totals 924 thousand Euros), given the amount per share approved and shares outstanding at the time of approval by the General Shareholders' Meeting on 17 March 2020. The dividend pay-out was settled in full on 16 April 2020.

During 2020, the Company has carried out its own share sale and purchase transactions, as described below:

Number of	Thousands of
shares	euros
31 December 2019	103,820	762
Additions	2,994,520	15,885
Disposals	(23,668)	(173)
31 December 2020	3,074,672	16,474

The negative balance arising from the sale of own shares during 2020 amounted to 6 thousand Euros, recorded under "Other reserves".

4| CONSOLIDATEDFINANCIALSTATEMENTS

Financial liabilities

Loans & Borrowings

The characteristics of the Loans & Borrowings at 31 December 2020 are as follows:

Type

Mortage Loan

Mortage LoanDeveloper´s LoanCorporate Loan

Corporate Loan

Project

El RosalVidaNova Parc

Megapark + Megapark leisure areaPortal de la Marina

Vistahermosa

Parque Abadia + commercial gallery

Gran Vía de Vigo

Rivas FuturaLagohLRE

LRE

LOANS AND BORROWINGS

Entity

(1) The 71% of the principal is covered by derivatives.

Interest rate(1)

EUR 3M + 1.75%EUR 3M + 1.85%

EUR 3M + 1.70%EUR 3M + 1.70%

EUR 3M + 1.85%

1.80% and 1.93%

EUR 3M + 1.75%

1.90%EUR 3M + 2.00%EUR 12M + 1.60%

1.67%

Financial liabilities from the issue of bonds and other securities

Corresponds to the bonds issued by the Group amounting to 140,000 thousand Euros in 2015.

Below you will ﬁnd the net Loan To Value calculation as at

31 December 2020:

Maturity dateNominal amount

(Thousands of euros)

07/07/2030 31/12/2024

50,000

28,000

24/02/2023

105,250

24/02/2023 02/03/2022

60,000

21,550

23/05/2024

42,060

14/03/2022 19/12/2024

82,400

34,500

29/06/2025

98,500

16/05/2021 04/05/2027

30,000 70,000

Current

(Thousands of euros)

3,117

253

156

2,597

- -4,311

29,940

Non-Current

(Thousands of euros)

45,621

27,449

102,562

58,887

21,419

38,948

81,683 34,333

89,806

185

(Thousands of euros)

40,593

69,900

570,608

GAV

Full Consolidation Gross Debt Equity Method Gross Debt Total gross debt

31/12/2020 1,475,490 757,106 - 757,106

Cash (Full Consolidation and Equity Method)

139,268(1)

Total net debt NET LTV

617,838 41.9%(2)(3)

(1) Only available cash considered | (2) Result of Total net debt/GAV | (3) The net LTV aﬅer 22 supermarkets portfolio divestment, would be 39.4%

At 31 December 2020, Lar España's debt stood at 757,106 thousand Euros, with an average cost of 2.2% and a net LTV ratio of 41.9%. The average debt maturity stood at 3 years.

The main debt indicators and the amortisation schedule is detailed below:

757.1 MM€Financial Debt

Back-Loaded Amortisation Proﬁle (€ Million)

2021

BANK DEBT

2022

SENIOR SECURED BOND

41.9%(*)

2.2%

Net LTV

Average cost of debt

2023

2024

>2024

Deferred tax liabilities

Other non-current liabilities

At 31 December 2020, this entry included deferred tax lia-bilities deriving from the business combination carried out by the acquisition of the subsidiary LE Retail Rivas, S.L.U. in 2018 as well as the acquisitions of the subsidiaries LE Retail Abadía, S.A.U., LE Retail Hipermercados I, S.A.U., LE Retail Hipermercados II, S.A.U., LE Retail Hipermercados III, S.A.U. and LE Retail Gran Vía de Vigo, S.A.U. in 2017 and 2016. The- se amounts correspond to the tax eﬀect derived from the diﬀerence between the fair value and the ﬁscal value of the acquired real estate investments.

(*) The net LTV aﬅer 22 supermarkets portfolio divestment, would be 39.4%.

Correspond to security deposits received by way of guaran-tee from the tenants of the company's assets.

4| CONSOLIDATEDFINANCIALSTATEMENTS

4.4

Consolidated Statement of Cash Flows

2020	2019
A) CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES	8,538	16,797
1. Proﬁt/(loss) for the period before tax	(53,668)	79,628
2. Adjustments for:	123,369	(21,150)
Proﬁt / (loss) from adjustments to fair value of investment properties (+/-)	100,656	(40,037)
Impairment (+/-)	-	226
Financial income (-)	(40)	(12)
Financial expenses (+)	20,096	18,977
Inclusion of ﬁnancial expenses in assets	-	(659)
Changes in Fair value of ﬁnancial instruments (+/-)	2,914	1,836
Share in proﬁt (loss) for the period of equity-accounted companies (+/-)	(257)	(473)
Results of disposal of investments properties (+/-)	-	(1,008)
3. Changes in operating assets and liabilities	(44,387)	(26,247)
Trade and other receivables (+/-)	(28,211)	(1,061)
Other current assets and liabilities (-)	(662)	(981)
Trade and other payables (-)	(15,514)	(24,205)
4. Other cash ﬂows used in operating activities	(16,776)	(15,434)
Intereset paid (-)	(16,776)	(15,434)
B) CASH FLOWS USED IN INVESTING ACTIVITIES	(24,582)	(53,114)
1. Payments for investments (-)	(24,582)	(134,373)
Investment property	(24,582)	(134,373)
2. Proceeds from divestments (+)	-	81,259
Investment property	-	78,259
Inﬂow of cash in business sales	-	3,000
C) CASH FLOWS FROM FINANCING ACTIVITIES	(7,570)	5,613
1. Payments made and received for equity instruments	(15,719)	(39,551)
Procceds from issue of share capital (+)	-	6,425
Acquisition/disposal of treasury shares (- /+)	(15,719)	(45,976)
2. Proceeds from and payments for ﬁnancial liability instruments	62,243	117,764
a) Issue of:	102,327	160,055
Bank borrowings (+)	101,327	156,955
Liabilities with associates (+)	1,000	3,100
b) Redemption and repayment of:	(40,084)	(42,291)
Bank borrowings (-)	(40,084)	(42,291)
3. Payments for dividends and remuneration on other equity instruments	(54,094)	(72,600)
Dividends (-)	(54,094)	(72,600)
D) CASH AND CASH EQUIVALENTS IN NON-CURRENT ASSETS HELD FOR SALE	(2,885)	(97)
E) NET INCREASE IN CASH AND CASH EQUIVALENTS (A+B+C+D)	(26,499)	(30,801)
F) CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD	160,527	191,328
G) CASH AND CASH EQUIVALENTS AT END OF PERIOD (E+F)	134,028	160,527

Shopping Centres / As Termas (Lugo)

4| CONSOLIDATEDFINANCIALSTATEMENTS

4.5

Grupo Lar fees as Lar España´s Manager

Base fee (Fixed fees)

In accordance with the Investment Manager Agreement (IMA) signed on 19 February 2018 between Lar España and its manager, Grupo Lar, the base fee to be paid by Lar España is calculated on the basis of the maximum amount of:

• €2 million
• The sum of (a) 1.00% of the portion of the EPRA NAV (excluding net cash) as of the prior December 31 which is up to and including €1,000 million, and (b) 0.75% of the portion of the EPRA NAV (excluding net cash) as of the prior December 31 which is in excess of €1,000 mi-llion.

As a result, the ﬁxed fees entered in the Global Consolidated

Income Statement for Lar España at 31 December 2020 total 8,496 thousand Euros.

Base Fee

EPRA NAV 13.12.19

Gross fee

Grupo Lar expenses incurred by Lar España

Fees indirectly paid in subsidiary companies (*)

Thousands of Euros 1,003,760 10,028 (170)

(1,028)

Fee reduction due to the COVID-19 crisis BASE FEE

(334) 8,496

(*) Lagasca99 fees

Performance fee (Variable fees)

Likewise, Grupo Lar has the right to a Performance Fee that is paid to the manager depending on the proﬁtability obtained by Lar España shareholders.

In this respect, the annual proﬁtability of shareholders is de- ﬁned in the contract as the sum of the change to EPRA NAV of the Group during the period, less net funds obtained from the issue of shares during the period, plus the dividends dis-tributed during said period

The performance fee to be drawn by the Investment Mana-ger will be linked to both the EPRA NAV and the market ca-pitalisation of the Company, and subject to an overall cap equivalent to 3% of the EPRA NAV of the Company as of 31 December of the preceding year.

The amount of this remuneration will be accrued by the Ma-nagement Company from the moment that:

• Annual EPRA NAV increase (net of capital increase and shareholders distributions) over 10%16% of the amount beyond the 10% of annual increase.
• Annual increase of the market capitalization (net of capital increase and shareholders distributions) over 10%4% of the amount beyond the 10% of annual increase.

The Company´s EPRA NAV variation is calculated as follows:

EPRA NAV Evolution

EPRA NAV 31.12.19

EPRA NAV 31.12.20

Gross difference

2019 Dividend paid in 2020

Net difference

Therefore, no performance fee will be paid based on the change in EPRA NAV.

Thousands of Euros 1,003,760 881,376

(122,384)

55,000

(67,384)

The Company's market capitalisation evolution is also dis-played in the following table:

Market Capitalization Evolution	Thousands of Euros
Market capitalisation 31.12.19 (*)	648,621
Market capitalisation 31.12.20 (*)	420,949
Gross difference	(227,672)
2019 Dividend paid in 2020	55,000
Net difference	(172,672)
EVOLUTION % 31.12.2019 - 31.12.2020	(26.62%)
Return above 10%	0,00%
PERFORMANCE FEE	-

(*) Calculated taken into account the average closing price of the last 20 sessions

Market capitalization annual increase has not exceed 10%. Indeed, not amount has been accrued linked to this concept.

Therefore, the sum of 8,496 thousand Euros that results from adding the base fee to the performance fee is entered in the Global dated Income Statement at 31 December 2020 under the heading "Other Costs". See section 4, "Consolida-ted Financial Statements".

Fixed and variable fees have been taken into account in the

EPRA Cost Ratios calculation (section 5 "EPRA Information").

4| CONSOLIDATEDFINANCIALSTATEMENTS

4.6

Proposed Shareholder Remuneration

Lar España was founded with the aim of generating strong returns for its shareholders via a signiﬁcant dividend pay-out. In line with recent company notiﬁcations, and despite the unprecedented situation experienced in 2020, the Com- pany has conﬁrmed that it will continue to retain an at-tractive dividend policy.

Based on the cash generated in 2020, the dividend pay-out will amount to €27.5 million.

Therefore, the pay-out to shareholders for the ﬁnancial year ended on 31 December 2020 to be presented at the Annual General Meeting will be €27.5 million, equating to earnings of €0.31 per share.

Dividend€27.5 Mn

€0.31 per share

3.1%

Dividend Yield over

NAV (31.12.20)

6.7%

Dividend Yield over market capitalization (31.12.20)

4.7

Shareholder return

The shareholder rate of return in 2020 stood at (3.66%). To calculate the rate of return, we use the growth per share over the ﬁnancial year, which is the sum of:

• The variation in the Company's EPRA NAV per share.
• Dividend per share distributed during the ﬁnancial year.

Shareholder Rate of Return =

EPRA NAV per share 31.12.2019

EPRA NAV 31.12.19

EPRA NAV 31.12.20

NAV Growth 2020

2019 Dividend paid in 2020

Growth (NAV + Dividend)

SHAREHOLDER RETURN 2020

Growth (NAV +Dividend) per share

€/share

11.47 10.42 (1.05) 0.63 (0.42)

(3.66%)

Shareholder Rate of Return (3.66%)

EPRA INFORMATION p.96

5.1 EPRA Earnings p.100

5.2 EPRA Net Asset Value Ratios p.101

5.3 EPRA NIY and EPRA "topped-up" NIY p.106

5.4 EPRA Vacancy Rate p.108

5.5 EPRA Cost Ratios p.109

Shopping Centre / Lagoh (Seville)

EPRA Awards

• In October 2019, the Reporting & Accounting Committee of EPRA (European Public Real Estate Association(1) upda-ted its Best Practices Recommendations(2) guidelines in order to improve the presentation, transparency, com-parability and relevance of the published results of listed real estate companies in Europe.
Lar España fully supports and endorses the principle of standardizing the reporting of performance indicators from the perspective of comparability and improving the quality of information provided to investors and other users of the ﬁnancial information.
- • In September 2020, for the sixth consecutive year, Lar España was awarded the EPRA Gold Award for the qua-lity of ﬁnancial information made available to its main interest groups. Regarding the information published about ESG, Lar España has again obtained the highest distinction by EPRA, achieving for the third consecutive year the Gold Award.
  This highlights the international recognition for the information reported by Lar España and made availa-ble to its shareholders
For this purpose, we have included an speciﬁc chapter with our main economic indicators following EPRA gui-dances.

(1) Not-for-proﬁt association founded in 1999 registered in Belgium which aims to make the ﬁnancial statements of public real state companies clearer, more transparent and comparable across Europe.

(2) "Best Practices Recommendations - BPR" available atwww.epra.com

2015

2016

2017

2018

2019

2020

Key performance indicators described in the Best Practices Recomendations developed by EPRA are shown as follows:

Indicator

EPRA Earnings EPRA NAV EPRA NNNAV EPRA NRV(*)

EPRA NTA(*)

EPRA NDV(*)

EPRA Net Initial Yield (NIY)

EPRA "topped-up" NIY EPRA Vacancy Rate EPRA Cost Ratio

EPRA Cost Ratio

(excluding costs of direct vacancy)

31/12/2020 (Thousands of euros)/%	31/12/2020 (Euros per share)
49,902	0.58
881,376	10.42
859,650	10.17
881,376	10.42
881,376	10.42
859,650	10.17
5.7%	-
5.9%	-
4.5%	-
15.7% (**)	-
13.5% (**)	-

(*) New EPRA ratios calculated according to the latest modiﬁcations included in the EPRA "Best Practices and Recommendations" document. For more details see section 5.2 EPRA NAV ratios.

(**) Ratio calculated considering recurring expenses. See terms deﬁnitions in Glossary, section 8.

5.1

EPRA Earnings

(Thousands of Euros)

100

EARNINGS PER IFRS INCOME STATEMENT

Change in value of investment properties

Profits or losses on disposal of investment properties, development properties held for investment and other interests

Tax on profits or losses on disposals

Negative goodwill

Changes in fair value of financial instruments and associated close-out costs Acquisition costs on share deals and non-controlling joint venture interests Deferred tax in respect of EPRA adjustments

Adjustments to above in respect of joint ventures Non-controlling interests in respect of the above EPRA EARNINGS

Weighted average number of shares (excluding treasury shares)

EPRA EARNINGS PER SHARE (EUROS)

EPRA Earningsper share +29% vs 2019

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Lar España Real Estate SOCIMI SA published this content on 25 February 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 25 February 2021 15:34:01 UTC.

Latest news about Lar España Real Estate SOCIMI, S.A.

Transcript : Lar España Real Estate SOCIMI, S.A., 2023 Earnings Call, Feb 29, 2024	29/02
Lar España Real Estate SOCIMI, S.A. Reports Earnings Results for the Full Year Ended December 31, 2023	29/02	CI
Transcript : Lar España Real Estate SOCIMI, S.A., Nine Months 2023 Earnings Call, Nov 24, 2023	24/11
Lar España Sells Two Retail Parks in Spain for EUR129 Million	28/23/28	MT
Lar España Real Estate SOCIMI, S.A. Reports Earnings Results for the Half Year Ended June 30, 2023	28/23/28	CI
Transcript : Lar España Real Estate SOCIMI, S.A., H1 2023 Earnings Call, Jul 28, 2023	28/23/28
An unknown buyer acquired Rivas Futura and Vistahermosa retail parks from Lar España Real Estate SOCIMI, S.A. for ?130 million.	28/23/28	CI
Fitch Affirms Lar España Ratings on Stability of Property Portfolio	10/23/10	MT
Transcript : Lar España Real Estate SOCIMI, S.A., Q1 2023 Earnings Call, May 19, 2023	19/23/19
Lar España Real Estate SOCIMI, S.A. Reports Earnings Results for the First Quarter Ended March 31, 2023	19/23/19	CI
Lar España Real Estate SOCIMI, S.A. Reports Earnings Results for the Full Year Ended December 31, 2022	28/23/28	CI
Transcript : Lar España Real Estate SOCIMI, S.A., 2022 Earnings Call, Feb 27, 2023	27/23/27
Lar España Real Estate SOCIMI, S.A. Reports Earnings Results for the Nine Months Ended September 30, 2022	21/22/21	CI
Transcript : Lar España Real Estate SOCIMI, S.A., Q3 2022 Earnings Call, Nov 21, 2022	21/22/21
Lar España Real Estate SOCIMI, S.A. Reports Earnings Results for the Half Year Ended June 30, 2022	29/22/29	CI
Transcript : Lar EspaÂ±a Real Estate SOCIMI, S.A., H1 2022 Earnings Call, Jul 29, 2022	29/22/29
Lar España Real Estate SOCIMI, S.A. Reports Earnings Results for the First Quarter Ended March 31, 2022	25/22/25	CI
Transcript : Lar España Real Estate SOCIMI, S.A., Q1 2022 Earnings Call, May 23, 2022	23/22/23
Lar España Real Estate SOCIMI, S.A. Proposes Dividend in the Next Annual General Meeting	28/22/28	CI
Transcript : Lar España Real Estate SOCIMI, S.A., 2021 Earnings Call, Feb 28, 2022	28/22/28
Lar España Real Estate SOCIMI, S.A. Reports Earnings Results for the Full Year Ended December 31, 2021	25/22/25	CI
Castellana Properties Socimi, S.A. agreed to acquire 21.7% stake in Lar España Real Estate SOCIMI, S.A. from LVS II Lux XII S.à r.l. for €97.1 million.	27/22/27	CI
Transcript : Lar España Real Estate SOCIMI, S.A., Nine Months 2021 Earnings Call, Dec 14, 2021	14/21/14
Lar España Real Estate SOCIMI, S.A. Reports Earnings Results for the Nine Months Ended September 30, 2021	14/21/14	CI
Lar España Real Estate SOCIMI, S.A.'s Equity Buyback announced on January 15, 2020, has expired.	15/21/15	CI

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Company Profile

Lar Espana Real Estate SOCIMI SA is a Spain-based company primarily engaged in the operation of retail Real Estate Investment Trusts (REITs). The Company specializes in acquiring, managing and renting real estate assets within the Spanish market. Its business activities are divided into three segments: Shopping Centers, Offices, as well as Logistics. The Shopping Centers area is responsible for operation of a number of shopping malls, namely Txingudi, Las Huertas, Albacenter, Anec Blau, Hiper Albacenter, and Nuevo Alisal, among others. The Offices segment invests in office properties, such as Arturo Soria, Cardenal Marcelo Spinola, Egeo and Eloy Gonzalo. The Logistics division focuses on managing logistics warehouses, including Alovera I and Alovera II. The Company also owns a plot for residential properties development. It is a parent of a number of entities, such as Lar Espana Inversion Logistica SA, Gran Via Centrum Holdings SAU, Global Noctua and Puerta Maritima Ondara.

Sector

Commercial REITs

Calendar

26/07/2024 - Q2 2024 Earnings Release (Projected)

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Income Statement Evolution

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Ratings for Lar España Real Estate SOCIMI, S.A.

Trading Rating

Investor Rating

ESG Refinitiv

A-

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Analysts' Consensus

Sell

Buy

Mean consensus

BUY

Number of Analysts

Last Close Price

7.1 EUR

Average target price

7.81 EUR

Spread / Average Target

+10.00%

Consensus

EPS Revisions

Estimates Revisions

Quarterly revenue - Rate of surprise

Company calendar

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