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PRESS RELEASE: CPI PROPERTY GROUP - Financial -3-

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PRESS RELEASE: CPI PROPERTY GROUP - Financial Results for the Third Quarter of 2021

DGAP-News: CPI PROPERTY GROUP / Key word(s): 9 Month figures CPI PROPERTY GROUP - Financial Results for the Third Quarter of 2021 2021-11-30 / 20:51 The issuer is solely responsible for the content of this announcement.



CPI Property Group (société anonyme) 40, rue de la Vallée L-2661 Luxembourg R.C.S. Luxembourg: B 102 254 Press Release - Corporate News

Luxembourg, 30 November 2021 CPI PROPERTY GROUP - Financial Results for the Third Quarter of 2021 CPI PROPERTY GROUP (hereinafter "CPIPG", the "Company" or together with its subsidiaries the "Group"), a leading owner of income-generating European real estate, hereby publishes unaudited financial results for the nine-month period ended 30 September 2021.

The third quarter of 2021 was positive for CPIPG by every measure," said Martin Nemecek, CEO. "The income, scale and value of our property portfolio continued to grow; our leadership position in Central European real estate has been further solidified through consistently strong performance."

Highlights for the third quarter of 2021 include:

- CPIPG's property portfolio rose to EUR11.9 billion (up 15% versus 2020) as the Group completed EUR656 million of acquisitions and benefited from a EUR879 million increase in fair value mainly relating to offices in Berlin and Warsaw, along with landbank and residential in the Czech Republic and also factoring in recent acquisitions in Italy at sharp discounts to fair value.

- Total assets reached EUR13.3 billion (up 13% versus 2020), driven by increases to the property portfolio, offset by a slight reduction in cash and cash equivalents.

- Net rental income increased to EUR265 million (up 6% versus Q3 2020) and consolidated adjusted EBITDA rose to EUR272 million (up 6% versus Q3 2020) due to the contribution from recent acquisitions and developments, broadly stable occupancy at 93.3%, limited COVID-19 rent discounts and 2.6% like-for-like growth in gross rental income.

- Because of a strong increase in bookings, the hotel segment reported net income of EUR10 million.

- Net business income (up 9% versus Q3 2020 to EUR282 million) and FFO (up 20% versus Q3 2020 to EUR208 million) show the benefits of CPIPG's organic rental growth, improved performance in hotels, and contribution from recent acquisitions.

- The Group collected 95% of contracted rent in Q1-Q3 2021 before the impact of one-time COVID-19 discounts, which amounted to about 3.5% of gross rental income. Office and residential collections were close to 100%.

- EPRA NRV (NAV) increased by 17% to EUR6.0 billion.

- Net Loan-to-Value (LTV) at 39.3% (-1.4 p.p. versus 2020, -1.7 p.p. versus Q3 2020) is below the Group's target of 40%.

- Unencumbered assets remain high at 67% (-3 p.p. versus 2020) and net ICR stood at 5.2x (-0.2x versus 2020), well above financial policy guidelines.

- CPIPG's total liquidity stood at more than EUR1.2 billion at the end of Q3 2021.

- On 1 September 2021, Mr. Vitek, CPIPG's primary shareholder, subscribed to 162,337,662 new ordinary shares for EUR100 million.

Notable events occurring after 30 September 2021 include:

- On 22 November 2021, CPIPG and the "Apollo Funds" managed by affiliates of Apollo Global Management, Inc. (together with its consolidated subsidiaries, "Apollo") announced Apollo's subscription for new shares for a total amount of EUR300 million, resulting in a stake of about 5.5%. On the same date, Mr. Vitek also subscribed to 243,506,494 new ordinary shares of CPIPG at EUR0.616/share, increasing the Group's equity by a further EUR150 million. Proceeds from the share issuances will be used for acquisitions and deleveraging.

- To accommodate Apollo as a new equity investor and further regularize the Group's equity shareholder distributions, CPIPG adopted a new distribution policy, increasing our FFO I distribution target from 50% to 65% beginning in 2022.

- In total, the Group has raised EUR550 million of equity from Apollo and Mr. Vitek in H2 2021.

- In August 2021, CPIPG's board of directors approved a plan to complete up to EUR1 billion of disposals in the next 6 to 12 months, subject to pricing. Substantial progress has been made on disposals with about EUR700 million expected to sign and partially close in 2021 with a clear pipeline for early 2022. In the vast majority of cases, disposals are expected to be at prices well above book value.

CPIPG's operational successes combined with recent capital raising and disposals clearly support our conservative financial profile," said David Greenbaum, CFO. "The Group is well-prepared to pursue growth opportunities while continuing to invest in our portfolio." FINANCIAL HIGHLIGHTS


Performance Q1-Q3 2021 Q1-Q3 2020 Change

Gross rental income EUR million 291 264 10.0%
Net rental income EUR million 265 251 5.7%
Net hotel income EUR million 10 (1) 1,752%
Total revenues EUR million 474 451 5.2%
Net business income EUR million 282 260 8.7%

Consolidated adjusted EBITDA EUR million 272 257 6.0%
Funds from operations (FFO) EUR million 208 173 20.1%

Net profit for the period EUR million 801 58 1,288%



Assets 30-Sep-2021 31-Dec-2020 Change

Total assets EUR million 13,307 11,801 12.8%
Property portfolio EUR million 11,885 10,316 15.2%
Gross leasable area sqm 3,659,000 3,636,000 0.6%
Occupancy % 93.3 93.7 (0.4 p.p.)
Like-for-like gross rental growth* % 2.6 0.8 1.8 p.p.

Total number of properties** No. 349 343 1.7%
Total number of residential units No. 11,739 11,929 (1.6%)
Total number of hotel rooms*** No. 6,850 6,753 1.4%

* Based on headline rent, excluding one-time discounts
** Excluding residential properties in the Czech Republic
*** Including hotels operated, but not owned by the Group

Financing structure 30-Sep-2021 31-Dec-2020 Change

Total equity EUR million 6,743 5,787 16.5%
EPRA NRV (NAV) EUR million 5,967 5,118 16.6%

Net debt EUR million 4,675 4,194 11.5%
Net Loan-to-value ratio (Net LTV) % 39.3 40.7 (1.4 p.p.)
Net debt/EBITDA 12.9x 12.4x 0.5x
Secured consolidated leverage ratio % 11.5 12.0 (0.5 p.p.)
Secured debt to total debt % 29.2 29.0 0.2 p.p.
Unencumbered assets to total assets % 67.4 70.0 (2.6 p.p.)
Net ICR 5.2x 5.4x (0.2x)


CONDENSED CONSOLIDATED INTERIM INCOME STATEMENT*


Nine-month period ended
(EUR million) 30 September 2021 30 September 2020
Gross rental income 290.6 264.1
Service charge and other income 93.7 96.3
Cost of service and other charges (74.4) (72.3)
Property operating expenses (44.8) (37.3)
Net rental income 265.1 250.8
Development sales 12.1 17.2
Development operating expenses (9.3) (15.9)
Net development income 2.8 1.3
Hotel revenue 47.8 36.3
Hotel operating expenses (38.2) (36.9)
Net hotel income 9.6 (0.6)
Revenues from other business operations
Other business revenue 29.9 36.7
Other business operating expenses (25.1) (28.5)
Net other business income 4.8 8.2
Total revenues 474.1 450.7
Total direct business operating expenses (191.8) (191.0)
Net business income 282.3 259.7

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PRESS RELEASE: CPI PROPERTY GROUP - Financial -2-


Net valuation gain (loss) 790.7 (11.2)
Net gain on disposal of investment property and subsidiaries 1.2 0.6
Amortization, depreciation and impairment (22.4) (62.7)
Administrative expenses (40.1) (34.3)
Other operating income 4.7 4.6
Other operating expenses (3.7) (1.5)
Operating result 1,012.7 155.2
Interest income 16.4 12.2
Interest expense (69.0) (58.0)
Other net financial result 1.1 (8.5)
Net finance costs (51.5) (54.4)
Share of gain (loss) of equity-accounted investees (net of tax) 3.9 (11.2)
Profit before income tax 965.1 89.6
Income tax expense (164.2) (31.9)
Net profit from continuing operations 800.9 57.7

* The presented financial statements do not represent a full set of interim financial statements as if prepared in accordance with IAS 34

Gross rental income

Gross rental income increased by EUR26.5 million (10.0%) to EUR290.6 million in Q1-Q3 2021 primarily due to higher rental income generated by the office portfolios in Berlin (EUR7.1 million) and Warsaw (EUR3.1 million) and acquisitions in Italy (EUR10.8 million).

Net hotel income

In Q1-Q3 2021, hotel revenues increased by EUR11.5 million (31.5%) to EUR47.8 million due to partial recovery from the COVID-19 restrictions. In particular, Suncani Hvar generated net income of EUR8.5 million from total net hotel income of the Group of EUR9.6 million. On the other hand, hotels in larger cities such as Prague continue to be negatively impacted by the COVID-19 restrictions.

Net valuation gain

In Q1-Q3 2021, the valuation gain reflected primarily an increase of the fair value of Berlin offices (EUR398.2 million) newly acquired assets in Italy (EUR135.1 million), two landbanks in Prague (EUR122.5 million) and the residential portfolio in the Czech Republic (EUR71.8 million).

Amortization, depreciation and impairment

Amortization, depreciation, and impairment decreased by EUR40.3 million to EUR22.4 million in Q1-Q3 2021 due to impairment loss of EUR30.8 million from revaluation of hotels in Q1-Q3 2020. In Q1-Q3 2021, the Group partially released the impairment in the amount of EUR10.8 million.

Interest expense

Interest expense increased by EUR10.9 million to EUR69.0 million in Q1-Q3 2021 due to increase in the volume of bonds issued. CONDENSED CONSOLIDATED INTERIM STATEMENT OF FINANCIAL POSITION*


(EUR million) 30 September 2021 31 December 2020
NON-CURRENT ASSETS
Intangible assets and goodwill 108.1 107.1
Investment property 10,223.0 8,792.6
Property, plant and equipment 842.2 779.4
Deferred tax assets 152.7 155.6
Equity accounted investees 663.5 658.1
Other non-current assets 325.0 330.9
Total non-current assets 12,314.5 10,823.7
CURRENT ASSETS
Inventories 32.1 38.8
Trade receivables 92.1 85.4
Cash and cash equivalents 541.9 632.3
Assets linked to assets held for sale 130.6 37.7
Other current assets 195.6 183.5
Total current assets 992.3 977.7
TOTAL ASSETS 13,306.8 11,801.5
EQUITY
Equity attributable to owners of the Company 5,011.3 4,320.8
Perpetual notes 1,643.8 1,369.6
Non-controlling interests 87.6 96.1
Total equity 6,742.7 5,786.5
NON-CURRENT LIABILITIES
Bonds issued 3,539.2 3,195.2
Financial debts 1,407.2 1,269.6
Deferred tax liabilities 1,006.9 842.2
Other non-current liabilities 105.2 116.9
Total non-current liabilities 6,058.5 5,423.9
CURRENT LIABILITIES
Bonds issued 104.2 108.8
Financial debts 166.0 253.0
Trade payables 83.7 70.6
Other current liabilities 151.7 158.6
Total current liabilities 505.6 591.0
TOTAL EQUITY AND LIABILITIES 13,306.8 11,801.5

* The presented financial statements do not represent a full set of interim financial statements as if prepared in accordance with IAS 34 Total assets

Total assets increased by EUR1,505.4 million (12.8%) to EUR13,306.9 million as at 30 September 2021 compared to 31 December 2020. The increase was driven primarily by acquisitions (investment property increased by EUR1,430 million and property, plant and equipment by EUR62.8 million, compared to 31 December 2020), partly offset by a slight decrease of loans provided and cash and cash equivalents.

Total liabilities

Total liabilities increased by EUR549.1 million (9.1%) to EUR6,564.1 million at 30 September 2021 compared to 31 December 2020, primarily due to movements in the Group's debts and increase of deferred tax liability. The Group issued senior unsecured bonds of EUR774 million, and additionally drawn secured debts of EUR253 million, while EUR464 million of bonds and EUR194.1 million of secured debts were repaid in Q1-Q3 2021. Deferred tax liability increased by EUR165 million in Q1-Q3 2021.

EQUITY AND EPRA NRV

Total equity increased by EUR956.2 million from EUR5,786.5 million as at 31 December 2020 to EUR6,742.7 million as at 30 September 2021. The movements of equity components were as follows:

- Increase due to the profit for the period of EUR747.3 million (profit to the owners of EUR736.7 million);

- Decrease due to share buy-back of EUR240 million;

- Increase due to issuance of new shares EUR100 million;

- Increase in translation reserve of EUR63 million;

- Decrease in revaluation, hedging and legal reserve of EUR6 million;

- Increase of NCI due to acquisitions and sales in the period of EUR18 million;

- Increase due to issuance and repayment of perpetual notes net of EUR274 million (including interests);

EPRA NRV was EUR5,967 million as at 30 September 2021, representing increase of 16.6% compared to 31 December 2020. The increase of EPRA NRV was driven by the above changes in the Group's equity attributable to the owners (increase of retained earnings and other reserves).


30 September 2021 31 December 2020

Equity attributable to the owners (NAV) 5,011 4,321
Diluted NAV 5,011 4,321
Revaluation of trading property and PPE 2 3
Deferred tax on revaluations 996 837
Goodwill as a result of deferred tax (43) (43)
EPRA NRV (EUR million) 5,967 5,118 GLOSSARY
Alternative
Performance Definition Rationale
Measures
(APM)
Consolidated Net business income as reported deducting This is an important economic indicator showing a
adjusted administrative expenses as reported. business's operating efficiency comparable to other
EBITDA companies, as it is unrelated to the Group's
depreciation and amortization policy and capital
structure or tax treatment. It is one of the
fundamental indicators used by companies to set their
key financial and strategic objectives.
Consolidated Consolidated adjusted total assets is total
adjusted assets as reported deducting intangible assets
total assets and goodwill as reported.
EPRA Net EPRA NRV assumes that entities never sell assets The objective of the EPRA NRV is to highlight the value
Reinstatement and aims to represent the value required to of net assets on a long-term basis.
Value (NRV) rebuild the entity.
Funds from It is calculated as net profit for the period Funds from operations provide an indication of core
operations or adjusted by non-cash revenues/expenses (e.g. recurring earnings.
FFO deferred tax, net valuation gain/loss,
impairment, amortization/depreciation, goodwill
etc.) and non-recurring (both cash and non-cash)
items (e.g. net gain/loss on disposals etc.). The

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calculation also excludes accounting adjustments
for unconsolidated partnerships and joint
ventures.
Net ICR It is calculated as Consolidated adjusted EBITDA This measure is an important indicator of a firm's
divided by a sum of interest income as reported ability to pay interest and other fixed charges from
and interest expense as reported. its operating performance, measured by EBITDA.
Net It is calculated as Net debt divided by fair Loan-to-value provides a general assessment of
Loan-to-Value value of Property Portfolio. financing risk undertaken.
or Net LTV
Secured Secured consolidated leverage ratio is a ratio of This measure is an important indicator of a firm's
consolidated a sum of secured financial debts and secured financial flexibility and liquidity. Lower levels of
leverage bonds to Consolidated adjusted total assets. secured debt typically also means lower levels of
ratio mortgage debt - properties that are free and clear of
mortgages are sources of alternative liquidity via the
issuance of property-specific mortgage debt, or even
sales.
Secured debt It is calculated as a sum of secured bonds and This measure is an important indicator of a firm's
to total debt secured financial debts as reported divided by a financial flexibility and liquidity. Lower levels of
sum of bonds issued and financial debts as secured debt typically also means lower levels of
reported. mortgage debt - properties that are free and clear of
mortgages are sources of alternative liquidity via the
issuance of property-specific mortgage debt, or even
sales.
Unencumbered It is calculated as total assets as reported less This measure is an important indicator of a commercial
assets to a sum of encumbered assets as reported divided by real estate firm's liquidity and flexibility.
total assets total assets as reported. Properties that are free and clear of mortgages are
sources of alternative liquidity via the issuance of
property-specific mortgage debt, or even sales. The
larger the ratio of unencumbered assets to total
assets, the more flexibility a company generally has in
repaying its unsecured debt at maturity, and the more
likely that a higher recovery can be realized in the
event of default.

Non-financial Definition
definitions
Company CPI Property Group S.A.
Property Portfolio The sum of value of Property Portfolio owned by the Group
value or PP value
Gross Leasable Area Gross leasable area is the amount of floor space available to be rented. Gross leasable area is
or GLA the area for which tenants pay rent, and thus the area that produces income for the property
owner.
Group CPI Property Group S.A. together with its subsidiaries
Net debt Net debt is borrowings plus bank overdraft less cash and cash equivalents.
Occupancy Occupancy is a ratio of estimated rental revenue regarding occupied GLA and total estimated rental
revenue, unless stated otherwise.
Property Portfolio Property Portfolio covers all properties and investees held by the Group, independent of the
balance sheet classification, from which the Group incurs rental or other operating income.

APM RECONCILIATION*


EPRA NRV reconciliation (EUR million) 30-Sep-21 31-Dec-20
Equity attributable to owners of the company 5,011 4,321
Effect of exercise of options, convertibles and other equity interests 0 0
Diluted NAV, after the exercise of options, convertibles and other equity interests 5,011 4,321
Revaluation of trading property and property, plant and equipment 2 2
Fair value of financial instruments 0 0
Deferred tax on revaluation 996 837
Goodwill as a result of deferred tax (43) (43)
EPRA NRV 5,967 5,118
Net LTV reconciliation (EUR million) 30-Sep-21 31-Dec-20
Financial debts 1,573 1,523
Bonds issued 3,643 3,304
Net debt linked to assets held for sale 0 0
Cash and cash equivalents (542) (632)
Net debt 4,268 4,194
Total property portfolio 11,885 10316
Net LTV 39.3% 40.7%
Net Interest coverage ratio reconciliation (EUR million) Q1-Q3 2021 2020
Interest income 16 18
Interest expense (69) (81)
Consolidated adjusted EBITDA 272 338
Net Interest coverage ratio 5.2x 5.4x
Secured debt to total debt reconciliation (EUR million) 30-Sep-21 31-Dec-20
Secured bonds 0 0
Secured financial debts 1,522 1,400
Total debts 5,217 4,827
Secured debt to total debt 29,2% 29.0%

* Totals might not sum exactly due to rounding differences.


Unencumbered assets to total assets reconciliation (EUR million) 30-Sep-21 31-Dec-20
Bonds collateral 0 0
Bank loans collateral 4,337 3,541
Total assets 13,307 11,801
Unencumbered assets ratio 67.4% 70.0%
Consolidated adjusted EBITDA reconciliation (EUR million)* Q1-Q3 21 Q1-Q3 20
Net business income 282 260
Administrative expenses (40) (34)
Other effects 30 31
Consolidated adjusted EBITDA 272 257
Funds from operations (FFO) reconciliation (EUR million)* Q1-Q3 21 Q1-Q3 20
Net profit/(loss) for the period 801 58
Deferred income tax (155) (23)
Net valuation gain or loss on investment property 791 (11)
Net valuation gain or loss on revaluation of derivatives 2 1
Net gain or loss on disposal of investment property and subsidiaries 1 1
Net gain or loss on disposal of PPE/other assets 0 0
Amortization, depreciation and impairments (22) (63)
Other non-cash items 11 24
Other non-recurring items (21) (14)
Share on profit of equity accounted investees/JV adjustments 4 (11)
Other effects 17 19
Funds from operations 208 173
Secured consolidated leverage ratio reconciliation (EUR million) 30-Sep-21 31-Dec-20
Secured bonds 0 0
Secured financial debts 1,522 1,400
Consolidated adjusted total assets 13,199 11,695
Secured consolidated leverage ratio 11.5% 12.0%

* Includes pro-rata EBITDA/FFO for Q1-Q3 2021 and Q1-Q3 2020 of Equity accounted investees


Property portfolio reconciliation (EUR million) 30-Sep-21 31-Dec-20
Investment property - Office 5,191 4,716
Investment property - Retail 2,467 2,184
Investment property - Land bank 1,278 798
Investment property - Residential 950 855
Investment property - Industry & Logistics 121 117
Investment property - Agriculture 102 99
Investment property - Development 82 13
Investment property - Hospitality 7 6
Investment property - Other 26 4
Property, plant and equipment - Hospitality 716 676
Property, plant and equipment - Mountain resorts 75 67
Property, plant and equipment - Agriculture 12 12
Property, plant and equipment - Office 12 9

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