Income Statement Summary
Total Revenue
During 2021, total revenue increased 8.8% vs. 2020, reaching Ps.1,163 million, driven by: i) the 2% increase in lease revenue, reflecting the greater economic stability on the back of the lessened effects of the pandemic, which was offset by a higher recognition of tenant1 incentive amortization in 2021 vs. 2020; and, ii) the sale of a surplus land plot in Sendero Sur for Ps.15 million and the sale of a land plot for Ps.77 million in Juarez, Chihuahua.
1For accounting purposes, in accordance with IFR 16, the tenant incentive for COVID-19 is amortized over the remaining term of the lease.
Operating Costs and Expenses
Operating costs and expenses decreased from Ps.580 million in 2020 to Ps.533 million in 2021, a decrease of 8.1%, as the costs related to the sale of the surplus land plot in Sendero Sur and the land plot in Ciudad Juarez, Chihuahua (Ps.114 million) were offset by lower operating expenses (Ps.161 million) as 2020 represented a high comparison base due to the transactional and nonrecurring expenses resulting from the capitalization of Acosta Verde.
(millions of Mexican pesos)
(millions of Mexican pesos)
Operative Income
Operating income for 2021 amounted to Ps.1,209 million, compared to an operating loss of Ps.158 million in 2020. This was primarily attributed to: i) higher total revenue; ii) lower operating expenses; and, iii) the recognition of Ps.587 million in fair value gain on investment properties vs. (Ps.649 million) in 2020.
Consolidated Net Income
During 2021, net income was Ps. 870 million vs. a Ps. 404 million net loss in 2020, driven by the combined effect of higher operating income and lower net financial expenses.
(millions of Mexican pesos)
(millions of Mexican pesos)
Key Financial Figures
NOI
During 2021, NOI (on a cash flow basis) totaled Ps.943 million, 37.2% higher than the Ps.687 million recorded in 2020, mainly due to lower tenant incentives, a recovery of overdue receivables and higher visitor traffic, resulting in higher revenues. This is the result of the operational normalization of tenants and shopping centers.
Operating EBITDA
As a result of the high comparison basis arising from the amortization of tenant incentives in accordance with IFR16, coupled with higher maintenance expense and annual sustaining fees of Mexican Stock Exchange, operating EBITDA decreased 2.2%, from Ps.718 million in 2020 to Ps.702 million in 2021. However, excluding only the accounting effect of tenant incentive amortization, operating EBITDA grew 4.1%.
NOI
(millions of Mexican pesos)
Operating EBITDA
(millions of Mexican pesos)
Debt
As of December 31, 2021, gross debt was Ps.5,789 million, 2.7% lower than the Ps.5,947 million recorded at the end of 2020, following the debt amortizations made during 2021 as scheduled.
Additionally, after deducting the Company’s cash on hand at the end of 2021, net debt decreased 17.0%, amounting to Ps.2,075 million.
Gross Debt
(millions of Mexican pesos)
Notes:
Gross Debt: Corporate debt plus debt owed to creditors and suppliers.
Net Debt: Gross Debt minus cash and cash equivalents (of which 85% is in U.S. dollars).
The debt of Trust 2715 is not consolidated into Acosta Verde’s Financial Statements. The Company has a 50% stake; however, the debt belongs 100% to Acosta Verde. It is recognized in the Financial
Statements at 50% due to the funding structure.
Balance Sheet Summary
Cash
As a result of more stable collections, cash amounted to Ps.3,554 million at the end of 2021, an increase of 7.7% versus Ps.3,302 million at the end of 2020.
Accounts Receivable
Accounts receivable decreased 58.5%, from Ps.71 million in 2020 to Ps.29 million in 2021, following the greater operational normalization of our tenants, which led to a 100% collection rate during the year.
(millions of Mexican pesos)
(millions of Mexican pesos)
Tenant Incentive Accruals
As a result of the challenging environment brought about by COVID-19, during 2020 the Company implemented a relief program for its tenants to help them navigate this complex backdrop with the greatest possible stability. For accounting purposes, the tenant incentive is amortized over the remaining term of the lease. In this regard, this item decreased 5.0%, from Ps. 120 million at the end of 2020 to Ps.114 million at the end of 2021.
Constructions in Progress
Construction in progress decreased 90.4%, from Ps.521 million at year-end 2020 to Ps.50 million at December 31, 2021, as the construction of Plaza Sendero Santa Catarina was completed, which was inaugurated in March 2021 and, thus, recognized as an investment property.
(millions of Mexican pesos)
(millions of Mexican pesos)
Investment Properties
As a result of the recognition of Plaza Sendero Santa Catarina in investment properties, given its completion in March 2021, and the corresponding revaluation, the balance of investment properties was Ps.13,703 million at the end of 2021, 7.4% higher than the Ps.12,757 million recorded in the same period of 2020.
Total Liabilities
Total liabilities decreased from Ps.8,092 million as of December 31, 2020, to Ps.7,863 million at the end of 2021, down 2.8%, mainly due to lower derivative financial instruments and bank debt balances.
It is worth mentioning that a large portion of liabilities (93.0%, equal to Ps.7,316 million) is non-current.
(millions of Mexican pesos)
(millions of Mexican pesos)
Stockholders’ Equity
As of December 31, 2021, stockholders’ equity increased 8.7% vs. 2020, totaling Ps.10,452 million, driven by the profit generated by the Company during 2021.