Global Trade Centre Aktie

Thank you for attending today's GTC 2025 Annual Results Call. My name is Sarah, and I'll be your moderator for today's call. [Operator Instructions] I would like to pass the conference over to our host, Michal Kuzawinski, to begin. You may go ahead.

Thank you, Sarah, and good morning, everybody. Welcome to our annual results call. We have with us today our CEO, Botond Rencz, joining us from Budapest office; and our CFO, Jacek Baginski, joining us from the Warsaw office. And I'm Michal Kuzawinski, Head of Investor Relations. So as Sarah said, today's presentation will be followed by Q&A. [Operator Instructions] So without further ado, I'm passing the voice over to Botond now.

Thank you. Thank you very much, Michal, for the kind introduction, and welcome, everybody. I hope that there is beautiful weather everywhere where you are listening into this call, at least in Budapest, it's looking really fantastic spring weather.

So welcome to our 2025 results call. I'm very happy that we also have Jacek, our CFO, on the call today so that you get all the right information that you would like to understand about our company results. Some of you may remember that we have taken over the management of GTC in the autumn last year. And together with the other Management Board members, we are very much focused and interested in driving a positive future for GTC.

And I can report to you that we have already made quite some important steps forward. Before we begin, let me reiterate some of the messages from my first annual letter as CEO of GTC.

Some of the challenges we have already tackled, but there is still a lot of inheritance from the past that we are dealing with. Our mandate is very clear: to stabilize, deleverage and to strengthen the group's foundations. For us, the immediate critical items remain liquidity protection, extension of debt maturities, balancing deleveraging through disposals with improving operations and stronger collaboration across the regions. We also want to continue with asset sales, and we will be very much focused on cost and efficiency improvements.

As part of this process, we began a review of the acquisition and the business potential in the German market. Following a detailed reassessment we started last year, we did the market sounding, and we are preparing the process of selling parts of the portfolio in a cluster approach, selectively monetizing regional concentrations. At the same time, we are cognizant that the risks that prices achieved may be, in some cases, materially below the book value of assets. As we embarked on the ambitious deleveraging plan, including the selective disposals in Germany, we will still strive for maximization of the disposal value by working on the operational improvements of the asset occupancy and achieved NOI.

So with that in mind, I would like to give a little bit of an overall picture of our financial performance, and then I will ask Jacek to go into more details into the financials. Now, on the slide that you are going to see, I would like to discuss three things. First, the review of our financial results; secondly, our progress on refinancing; and thirdly, removal of going concern uncertainty from the audit opinion.

In terms of financials, on one hand, our revenues were increasing 8% year-on-year, including Germany, which is obviously quite positive. On the other hand, when you look at this increase and you take the German revenues out, revenues were down 5% to EUR 179 million, with underlying like-for-like down 3%. Reflecting asset disposals and weaker income was the reason for this like-for-like reduction. For the first time, we introduced adjusted EBITDA definition to reflect a number of one-off items, which weighted on the reported earnings. After eliminating these one-offs that Jacek will explain later, our adjusted EBITDA was down 6% year-on-year to EUR 102 million.

On the balance sheet side, the group's net loan-to-value amounted to 57% as of the December 31, 2025, as compared to 52.7% in 2024. This is mainly due to impairment on investment property, largely in Hungary and in Poland. EPRA net tangible assets were PLN 8.3 per share. Where we did very good during this year was refinancing. This was probably the most relevant and important action for us. We refinanced the June 2026 unsecured Eurobonds with EUR 455 million secured bonds due October 2030 and repaid the remaining EUR 299 million after the balance sheet date in March 2026. We also refinanced EUR 340 million of bank loans falling due within 12 months.

And one thing that is very important for us, and that is that the emphasis of matter ongoing concern, material uncertainty was removed from the audit opinion, which is an important confirmation the work done in refinancing and liquidity management was meaningful. So at the end, we continue deleveraging the company, improving operational excellence and cost control by entering 2026 with much better liquidity position as before.

And I think now this is probably the right time for myself to give the mic to Jacek, who will go a little bit more into the details of the numbers. So Jacek, the mic is yours now.

Thank you very much. Good morning, ladies and gentlemen. Let me start from going into more details on the financial results as outlined by Botond just a minute ago. So first, something that is a great achievement of the company in 2025, which was the refinancing of the bonds. So as you guys remember, in October last year, we issued EUR 455 million new bonds that are due in October 2030 with a coupon of 6.5%, yielding around 7.7%, including the discount. Out of that net proceeds were close to EUR 430 million. These proceeds were used to repay EUR 494 million of outstanding bonds in 2 tranches.

First tranche, EUR 195 million was tendered in October 2025. And then the remaining close to EUR 300 million was redeemed early in March this year. At that date, GTC Aurora assumed all obligations under the new secured notes, the refinancing finished. On the rating side, Scope, which is the rating agency, upgraded the issuer rating to B with Positive Outlook, while Fitch rated the new secured notes with B+ and kept the Rating Watch Negative, designation subject to the bank refinancing progress. So obviously, we will be meeting with Fitch in a couple of days to present them with our latest results on the refinancing of the outstanding loans.

After the balance sheet date, we also refinanced EUR 330 million of the bank loans falling due within 12 months, of which EUR 230 million was extended by at least 5 years. So as a result, from close to EUR 890 million of short-term loans and bonds shown at the balance sheet as of end of year, the EUR 300 million was already repaid and EUR 330 million refinanced until today. And as Botond was emphasizing, so I'll just repeat because it's super important for the company also and for the investors that the most important external confirmation of this process, the financing process is that the auditors removed the emphasis of matters regarding material uncertainty related to going concern from the financial statement dated end of 2025.

If you can guys flip on the next slide. So this is the portfolio, not much happened here. So on the portfolio, the only change here is the lower value after revaluation losses and also some disposals during the year. I will elaborate on it later. Total investment portfolio, as you can see, is EUR 2.8 billion, including the notes in our Kildare, the data center development project and adjusted total investment portfolio. Excluding noncurrent financial assets right now is right around EUR 2.6 billion.

Next slide, please. So on the office, the performance of the office, the picture here is stable, although there are differences between the countries. Obviously, the good thing is that we managed to lease a lot. So leasing activity reached over 100,000 square meters in course of 2025 or 24,000 square meters in Q4 alone. Occupancy improved by 1 percentage point from 82% to 83%. Weighted average lease term declined slightly to 3.5 years from 3.8. On leasing, obviously, the good thing is that we signed a number of meaningful transactions including City Gate in Bucharest at around 9,000 square meters, CenterPoint 3 in Budapest with Uniqua at around 6,000 square meters, Advanced Business Center in Sofia at around 5,000 square meters and the 188 property in Budapest at around 5,000 square meters.

Next slide, please. On retail, retail portfolio is doing very well as in the previous years. Again, we continue with leasing activity. The leasing activity in course of 2025 exceeded 50,000 square meters and only 19,000 square meters were leased in Q4. Occupancy is constantly good and strong at 96% at the year-end. The weighted average lease is similar at the end of 2025 as at the end of 2024. And obviously, we see a good and strong tenant performance in course of 2025 with retail turnover increasing 5% year-on-year and more than 10 million visitors in our shopping centers with 1% growth of footfall.

Key leasing examples, including here are Galeria Jurajska with a fashion brand extension and expansion of around 3,500 square meters, reserved at around 2,800 square meters. In Galeria Polnocna, we extended with Sinsay at around 2,700 square meters and in Ada Mall in Belgrade we contracted with H&M at around 2,300 square meters.

Next slide, please. Residential portfolio, we purchased as you remember, late 2024. Here, you can see a slight improvement in occupancy from 83% to 86% year-on-year. The portfolio value is basically stable at that valuation of EUR 453 million, same square meters as we purchased it at the end of 2024. And again, we have still 5,200 residential units. The average headline rent increased slightly from EUR 7 per square meter to EUR 7.2 per square meter. Obviously, there is a lot to do with portfolio and obviously we will elaborate about it later during the presentation.

Next slide, please. On P&L, we are introducing an adjusted EBITDA parameter. And this is because of the large number of one-off items, which impact a lot of the KPIs that we are using in the company measuring the performance. This is obviously largely driven by the refinancing transactions, all the advisory works and a number of other one-off items that we recognize in particular, in Q4 last year. Looking at the income statement, and this was already reported by Botond. Revenue from the rental activity increased from EUR 188 million to EUR 202 million, which is 8% plus. But obviously, on the other hand, if we exclude Germany, there will be a drop. On the cost side, cost of the rental operations increased from EUR 57 million to EUR 73 million. This is mainly driven by the consolidation of the business in Germany, but also there is some cost and inflationary pressure on our property expenses.

Gross margin from operations was EUR 129 million versus EUR 131 million last year. So it's pretty flat. But excluding Germany, unfortunately, it fell by 10% to EUR 118 million, which is something that we are looking at and probably working to improve. Admin costs and expenses. Admin costs increased substantially. Again, the reason is the consolidation of the German business and the related one-off expenses that we recorded in course of 2025.

EBITDA dropped -- unadjusted EBITDA, I would say, dropped substantially from EUR 106 million to EUR 75 million. But adjusted EBITDA, which I will explain in a minute, was pretty stable. Basically, we recorded, as you can see here, EUR 102 million of that adjusted EBITDA comparing to EUR 108 million. The drop is mainly related to the disposals of some assets in course of 2024 and '25. On the financing front, you see the substantial increase of the financing cost from EUR 40 million to EUR 87 million. This is mainly driven by the financing, which was put in place to finance the acquisition of the German business. That obviously resulted with the increase of the weighted average interest rate from 4.56% -- sorry, from 3.45% to 4.56%.

Overall, together with the write-offs that we had, and you obviously see there is a massive write-off of EUR 146 million, mainly related to impairment of the assets in Hungary, which is around EUR 78 million; in Poland, around EUR 53 million that are basically the massive numbers coming from the recent valuation reports. So that taken together with the substantial increase of the finance cost resulted in the net loss of EUR 155 million compared to the profit that the company recorded in the year ending 2024.

Next slide, please. Okay. This is the, I would say, reconciliation of the EBITDA or the reported EBITDA to the adjusted EBITDA. So you see a number of, I would say, one-off nonrecurring items that were recorded. In particular, you see this in Q4 last year was almost EUR 22 million of one-offs related to, I would say, nonrecurring business activity. Obviously, the largest items are in U.K. office impairment of around EUR 5 million, severance payments at EUR 2 million, the advisory costs on the bonds of EUR 3.5 million, nonrecoverable VAT mainly related to disposal of land was EUR 5.3 million.

Some other nonrecurring costs related to the German operation is EUR 7.5 million on the annual basis. So basically, you see on the last columns on the right, this EUR 27 million were originally accounted for in the administrative expenses, which is EUR 14.6 million and other expenses of EUR 12.6 million.

Next slide, please. On cash flow, cash flow from operating activity was EUR 78 million compared to EUR 98 million last year. The decline is largely due to higher admin and other expenses, while gross margin from operations was largely unchanged year-on-year. In investing activity, the company spent EUR 80 million on real estate and related items, mainly assets under construction and CapEx and fit-out. At the same time, the company generated EUR 136 million proceeds from sales of investment, including Wilanow and the buildings of GTC Satellite, GTC Moderna, GTC Future, Matrix C, Matrix D, GTC X and NAP shares. So you see there is a list of disposals at the bottom in the reporting. We will continue disposals in course of 2026 in order to deleverage.

Change in deposits. The substantial increase of deposits mainly represent the amount set aside in GTC Finance for the repayment of the old bonds. On refinancing proceeds from long-term borrowings were EUR 493 million, mainly from the new secured bonds and the Galeria Polnocna loan, while repayment of the borrowings and bonds were EUR 218 million.

Interest paid obviously increased, and you saw that obviously, the accounting effect of it on the previous slide. But obviously, cash-wise, you see the negative outflow of the interest expenses of EUR 61 million compared to EUR 33 million recorded in 2024. So at the end, the cash balance is stronger, which is a combination of the disposals mainly and the repayment of the bonds is stronger. The cash balance is EUR 107 million at the end of last year.

The next slide, please. Here, obviously, there's -- on the asset side, there are some lines that moved materially, but the balance sheet number or the total asset didn't change substantially. So you can see basically that investment properties declined from EUR 2.7 billion to EUR 2.6 billion. This is mainly due to the sales of the land and reclassification of Artico building, but also the revaluation that we recorded and reported to you on the P&L. Assets held for sale dropped from EUR 155 million to EUR 20 million, and this is mainly due to disposals realized in course of 2025. Deposits increased from EUR 44 million to EUR 290 million. This mainly includes cash secured for the repayment of the outstanding or old bonds. Cash and cash equivalents increased as I reported on the cash flow and the total assets didn't change materially, as you can see from 1 year to the other.

Can you just go to the next slide, please? On equity and liabilities. So on the debt position, this slide still shows the balance sheet picture as of end of last year. So it does not include the full refinancing actions that the company undertook in course of Q1 2026. Short-term financing, debt financing, as you can see here, increased from EUR 220 million to EUR 889 million. This was mainly because the remaining EUR 299 million unsecured bonds as certain loans in Poland, Hungary and Germany were reclassified to the short term.

Long-term financial debt decreased from EUR 1.4 billion to slightly above EUR 1 billion for the same reason despite the addition of EUR 455 million new senior secured notes and EUR 84 million Galeria Polnocna loan. Since the balance sheet date, close to EUR 300 million of bonds were repaid and EUR 273 million of short-term bank loans refinanced. So a substantial part of the short-term debt position has been dealt with already.

Next slide, please. So on credit metrics, just maybe a few bullet points. So the net debt is approximately similar year-on-year. The LTV, however, increased from 52.7% to 57%, which is -- or really 56% when adjusted for cash on escrow accounts. Weighted average of the debt declined from 3.3 years to 2.9 years. But this is obviously, as I said, before -- this is at the balance sheet date. So this is before the refinancing actions taken by the company in Q1 this year.

Weighted average interest increased from 3.5% to 4.6%. Looking at the maturity profile, still the balance sheet, there is a substantial amount of the short-term debt. But as I said, most of them was dealt with in course of Q1 2026. So obviously, the main message on the refinancing and the balance sheet is that the company significantly reduced the refinancing risk relating to the bonds and the short-term loans. Now obviously, we will focus on the deleveraging and operating improvements as it was reported to you by Botond at the beginning of the presentation. So that's all on my side, and please, Michal, take it.

Thank you, Jacek. Sarah, we are ready to take questions.

The first questions have arrived from Jakub Caithaml from Wood. [Operator Instructions] FFO seems some EUR 20 million to EUR 25 million negative for the year. If we think about 2026, what will be the key changes versus 2025? Should we expect that the entire difference between adjusted EBITDA and EBITDA will improve the results with probably some offset by even higher interest costs, what else?

So it seems to be a question to Jacek. I just say that we reported FFO for the year of EUR 33 million. And Jakub, please and everybody, please review our revised FFO definition. From these results, we define FFO as adjusted EBITDA less net interest paid, less net taxes paid. So FFO is accounted for after adjusted EBITDA. Jacek, I mean, the remainder of the question is for you. So the outlook really for FFO for 2026.

So guys, there will be, I would say, a combination of a couple of elements. So obviously, as we discussed and presented our intention is to increase the EBITDA from the operating assets. This can be done by a couple of elements. First, the increase of the occupancy and then which is, I think, I don't want to say easier, but something more manageable is to substantial decrease of the property expenses in combination of the administrative expenses and other costs, which are under our control.

That, however, going forward, obviously, will be somehow impacted by planned disposal of assets that you will see in course of 2026. As Botond was saying, our main objective is to deleverage the company this year and next year from a pretty high LTV of 56%. But actually, the main focus will be on the improvement of the operating efficiency in combination with the sharp reduction of the costs.

Thank you, Jacek. And the next question from Jakub is on the U.K. office. So Jakub was not aware that we have a U.K. office. So probably you would also appreciate some outlook on this operation.

Botond, you want to explain because it was also a surprise for us.

Yes, it was a surprise for us. For some reason in the past, the company decided to open an office in London, and we are in the process of investigating how we can close that office because we are not actively using it, so to speak. We already identified what is the best legal way to terminate the office. So that is going to be, I would say, representing us some cost savings when we are successfully closing the office in London.

And in that adjustment, you see that the full fit-out has been written-off of that office. The next question from Jakub. So Jakub is asking what is the status of Kildare project and likelihood of its disposal?

Maybe I will start with the status and then obviously, Botond, if you can add up, you are very welcome. So basically, the project is developing well. The first 16 megawatts was -- out of 179 megawatts was already connected. We expect that additional power will be connected in the course of 2026. Obviously, as you probably know, we have a tenancy contract with the hyperscaler signed already and in place. The financing for the project that will allow it to develop is in place.

So I would say the project is advancing not as fast as we expected, but I think it's going into the right direction. There may be some, I would say, delays with the connection of power, but that would be only a question of time. So it's doing, I would say, relatively well and substantially better than I would say, comparing to the same period of 2025. In regard of the disposal, I don't know, Botond, if you want to say a few words on our plans on Kildare.

When we look at our disposals, and this relates to Kildare as well, we are scanning the market and open for selling our assets, but we do not want to dispose our assets at a distressed price. So we want to actually find what is the proper market price for this asset. This asset has a lot of upside value. As Jacek mentioned, there is a bit of a delay in the project, but everybody, the investors are very comfortable that this project will be successful.

But it's not a very simple project necessary to sell and find the right price. So selling land is a lot easier. You have a bit more liquidity and it's very, very simple more or less to sell at the right value. So we don't want to sell at any price, but we are open to sell at the proper price. I think that is probably the answer to Jakub's question.

Next question from Jakub is, where do we target LTV by the end of 2026?

Jakub, so really this depends on the dynamics of the disposal of the assets. As Botond was saying, there is a plan to dispose a number of assets. But obviously, we do not want to rush with that, not to compromise with the price. But we will be looking, I think, reasonably to decrease that LTV from 56% to some number closer to 50%. But again, that really depend on the dynamic of the of disposal of our assets, but we should be aiming at around 50% by the end of this year.

The final question from Jakub. What was the average interest rate on the loans, which have been refinanced in the first quarter of this year?

Actually, it was pretty similar to what we managed to do. So I think the margin on that loan was at around of 2.1%, and we managed to extend those loans at the similar margin, which is a pretty big achievement of the company.

It was, I think, even a little less than 2.1%, above 2% and below 2.1%. For us, it was very important that we could do this and the pricing was actually pretty good.

So then we have questions from Vikky Chen from IVO Capital Partners. Vikky would like to clarify if the 57% net LTV as of December last year includes both the new and old bonds?

Yes, it does.

And then Vikky, so we both have the debt and cash from that new bond. So the repayment does not change the picture on LTV.

No, it did because as I reported, basically, if you look at the structure of balance sheet, this is what I said, the LTV after the repayment or excluding, let's say, that double bond counting and cash also, that LTV at the balance sheet would be closer to 56%.

Thanks for clarification, Jacek. Then the next question from Vikky. So Vikky has a question, what is our plan for the remaining short-term debt due this year?

We will refinance. We simply refinance. So we are well advanced in discussions with the banks, whatever is left after the end of Q1 of this year will be refinanced in the course of Q2 this year.

I think, Jacek, if I recall it correctly, it is probably less than 10% of the total short term we had. So it's relatively small compared to the refinancing of the short-term loans. So most of the homework has been done by far.

Well, maybe just if we can elaborate on it. So Vikky, the fact of life is that as Botond said, we will refinance the short-term loans. But if you look at, let's say, what is going to happen in course of this year is that as we elaborated, we intend to sell a number of assets. And then in course of -- obviously, as a consequence of the disposals, we'll be using cash to repay of the senior loans provided to finance assets that we intend to sell. So obviously, on one side, obviously, in the short run, we will refinance. But I would say, in the perspective of the next 3 quarters, obviously, we will be repaying loans, not only short term if they are not refinanced, but also long term from the proceeds from disposal of the assets.

And the final question from Vikky is whether we expect the rating, Watch Negative, outlook to be resolved post the German loan refinancing we did this month.

I mean, if you allow me, gentlemen, to answer that question, please?

Yes.

So -- because I'm dealing with Fitch the most. So we are meeting the Fitch team in mid-May. And obviously, we hope that they will reflect the tremendous progress we've made on the refinancings in the rating outlook. But obviously, they are an independent research company. Would you like to add anything, Botond or Jacek?

No. You summarized it very well.

No.

So we have now questions from David Macher from Unity Asset Management Foundation. So David has a few questions on Germany. And generally, he is asking when do we plan to sell the portfolio and only part of it or all of it? That's his first question.

Okay. So maybe let me start with the answer. We have started selling some elements of the German portfolio. But roughly, we stand at 1% of the total portfolio that we sold. We do not have to sell it super fast, but we are planning to continue the selling and of course, seeing how the market is reacting and what are the prices that are being offered. So I wouldn't say that we want to sell all of it, we want to sell half of it. If we are getting attractive prices, we are continuing to sell and also with that, that would actually enable us to reduce our debt on that portfolio as well. So we will continue to progress with the disposal of the German portfolio.

David also asks the total disposal plan for the next 2 to 3 years. Roughly how much of the portfolio do we plan to sell?

Botond, can you comment?

I think this is a very valid question, but purposefully, in the past, we did not want to disclose exactly what is, let's say, our target threshold because as you can imagine, in some of our markets, the liquidity is varying. So sometimes there is liquidity, there is not. But I think we can say it is going to be, I would say, substantial if you look at the balance sheet of the company in the coming 2 to 3 years because when you also reflect about our borrowings, that is also reasonably substantial.

So for us to cure that, we will need, let's say, corresponding level of assets to be sold. But there is no, let's say, number drawn in the sand that unless we sell this, yes, successful or not successful. But it is going to be, I would say, substantial when you look at the overall portfolio because of our indebted situation.

Another question from David. David asks if the German portfolio is currently profitable on either EBITDA or adjusted EBITDA level.

This is something we are not disclosing in the financial statements, I'll just say. I don't know, Jacek, if you would like to add any guidance.

But everyone can calculate, right, basically looking at the consolidated balance sheet and P&L. And as you look at the slide related to the P&L, right, where basically, we report that to the level of NOI, right, Michal?

Correct.

Obviously below the administrative expenses, which are substantial. So on, I would say, EBITDA level, the portfolio is profitable. Obviously, the profitability is substantially below profitability of other businesses that we have in other countries, right? So this is more or less the answer to your question.

The final question from David is related to the severance payments, which were included as adjustments in EBITDA. David asks if these were severance payments related only to 2025 payments. And if there are any expected severance payments to be paid in 2026?

The answer to the question is yes. Basically, the severance payments were incurred and paid in 2025. If we expect to have further severance payments, you need to ask our Supervisory Board, maybe not. Let's see.

I think that would be it. Thank you for your active participation, everybody. Thanks for the questions. I'll just pass on to Jacek and Botond for their final remarks.

Thank you very much, Michal, for leading this webinar. And I would like to thank everybody for their attention. For us, I think it was a very critical year last year. And now I think you guys can see that our financial situation is finally stable again, and that actually enable us to go to the next stage of turning GTC around in 2026. Jacek?

I have nothing to add. So thank you very much, guys, for participation, and we wish you a nice and hopefully sunny short holiday. Thank you.

Thank you. Thank you, everybody.

Thank you. Bye-bye.

That concludes the GTC 2025 Annual Results Call. Thank you for joining. You may now disconnect your lines.

Good afternoon. My name is Dr. Zoltan Martonyi, and I serve as Chairman of the Supervisory Board for Globe Trade Centre S.A. I warmly welcome all those present at today's Extraordinary General Meeting of Shareholders of the company. I extend a particular welcome to all shareholders of the company, both those present in person and those represented by proxy. I welcome the members of the Management Board and the members of the Supervisory Board of Globe Trade Centre S.A. as well as all other participants of today's meeting.

The Extraordinary General Meeting of Shareholders of Globe Trade Centre Spolka Akcyjna with its registers' office in Warsaw has been convened for today, 14th of April 2026 at 12:00 noon Warsaw time at the Airport Hotel Okecie, the Airport Hotel Okecie at ul. Komitetu Obrony Robotnikow 24, conference room, Concorde, on the seventh floor. Pursuant to Article 409, Paragraph 1 of the Polish Commercial Companies Code, I hereby open the Extraordinary General Meeting of Shareholders of Globe Trade Centre S.A. The minutes of today's general meeting will be drawn up by notary, [ Monica Smegma ] -- Okay. Sorry. So [ Milena Shifga ] whom I warmly welcome. The technical support for voting at today's general meeting is provided by Unicomp-WZA. I kindly ask the representative of Unicomp to present the technical rules of voting to the shareholders and to conduct a test vote.

[Interpreted] Ladies and gentlemen, each of you received a tablet. And in the tab your data, you can check who you represent and how many shares. The vote is very simple. When the vote is ordered on your tablets, you will see the title of the vote and 3 decision keys. So you choose your decision. After choosing decision, you are transferred to the next screen, and then you will see your decision and then you have to confirm it. And then this vote will go into the system.

If it happens that this decision was wrongly chosen by you, so then you have the button return, you may come back to the first screen and then change your decision. But once you confirm the decision on the second screen, there is no way to return to the first screen. So I will start for you the test vote. So could you please take your vote? It's just a test to check that the system is working properly. Could you please vote? It's the test vote.

If there are any questions, this is the right moment to ask a question. Of course, we are at your service also throughout the conduct of this meeting. I can't see any questions. You can see the result of the vote on the screen.

Thank you very much for the presentation. I proceed to the agenda. The first matter requiring resolution is Item 2, the election of the Chairman of the Extraordinary General Meeting. I invite nominations. Please.

I would like to propose [ Jakub Zagrajek ] to chair today's meeting. I agree.

I order a secret ballot on resolution #1 regarding the election of the Chairman of the Extraordinary General Meeting. Please cast your votes.

[Voting]

Thank you very much. I declare that resolution #1 has been adopted unanimously. I now hand over the conduct of the proceedings to the Chairman of the General Meeting. Thank you very much.

[Interpreted] Thank you very much for your nomination. I have the attendance list in front of me, and I am signing this attendance list right now. I would like to inform you that this attendance list was prepared, checked and signed, and it is on the desk for you if anyone wants to see it. And I would like also to inform you that today's extraordinary meeting of Globe Trade Centre S.A. was convened by the Management Board on the basis of 198 of the Commercial Companies code and also on the basis of Article 8 of the company's statute.

So the notice was displayed on the company's website on the 16th of March 2026. In the same time, on the same day, the company published the report, 02/2026. In line with Article [ 16 ] Index 1 of the Commercial Companies Code, we have in this extraordinary meeting, the shareholders of the company who on the 29th of March 2026 were the shareholders of the company. So we have today in the extraordinary meeting 9 shareholders who represent in total 505,074,985 shares, which represent 87.95% of the total shares in the company. I would like to confirm the correctness of calling this meeting and its capability of adopting binding resolutions, resolutions that are stipulated on the agenda.

Now I move to the next point namely the adoption of the Extraordinary General Meeting agenda. This is the agenda that is published on the company's website on the 16th of March. Point number one, opening of the Extraordinary General Meeting, election of the Chairman of the Extraordinary General Meeting, statement regarding the extraordinary general meeting was duly convened and binding resolutions, adoption of the extraordinary general meeting agenda, adoption of the resolution regarding the appointment of the Chairman of Supervisory Board of the company, adoption of a resolution regarding the [indiscernible] of the company, adoption of a resolution regarding [indiscernible] of the company and the adoption of a new consolidated text of the Articles of Association of the company. And point #8, last one, closing of the extraordinary meeting.

So the wording of the draft resolutions was published on the company's website and in the current reports and all the participants had the possibility of reading these resolutions. I will not be reading the draft resolutions. But where we have under this point that we have a couple of competitive draft resolutions, I will explain which draft resolutions voted on at a given moment.

Are there any reservations regarding this proposal? So I can't see. So we will proceed in this way. At this moment, I order the vote on resolution #2 regarding the adoption of the agenda. And this vote is open. It's not secret. So could you please cast your votes on this resolution by open ballot.

[Voting]

[Interpreted] I close the vote. Thank you for your votes. And I would like to inform you that this resolution #2 has been adopted unanimously by open ballot for 505,074,985. There were no votes against and no abstentions. I would like to confirm the adoption of this resolution.

Now I move to the next item on the agenda #5, adoption of the resolution regarding the appointment of the Chairman of the Supervisory Board of the company. And to remind you, I would like to say, first of all, this resolution will be adopted by secret ballot. Secondly, on the basis of Article 413 of the Commercial Companies Code, if such persons -- so the Article 412 regulations are applicable for such persons if they are to vote or the representatives are to vote on this resolution. And in line with resolution #3, the Extraordinary General Meeting of the Shareholders of the company, acting pursuant to Article 385, paragraph 1 of the Commercial Companies Code and Article 9(3) of the Company's Articles of Association, hereby appoints Mr. Zoltan Martonyi as Chairman of the Supervisory Board of the Company. Are there any contributions? Are there any contributors to the discussion on this point? No, I can't see any. So I order the vote on the resolution #3. This is the secret ballot on the appointment of the Chairman of the Supervisory Board, Mr. Zoltan Martonyi. Cast your vote, please.

[Voting]

[Interpreted] Thank you. So I would like to inform you that the votes for yes, [ 444,044,338 ], against 5,322,360 and abstentions, 54,808,287. So therefore, the resolution enjoyed the absolute majority of votes and was adopted. I would like to congratulate to Mr. Zoltan Martonyi for his nomination to the position of the Chairman of the Supervisory Board.

Now I move to the next point on the agenda, namely adoption of a resolution regarding the termination of the remuneration of the members of the Supervisory Board of the company. And I would like to inform you that this resolution under this point will be adopted by secret ballot as the same in line with Article 413 of the Commercial Companies Code, the persons who will vote themselves by the representative vote of this resolution of the verifications of Article [indiscernible] of the Commercial Companies Code apply.

I will not read the entire draft. I would like all of you to draw attention to the fact that in line with the draft resolution #4, the new amount of the remuneration are shown. So the monthly remuneration will be increased from PLN 10,100 to PLN 12,500 and the monthly remuneration of the Chairman of the Supervisory Board is from PLN 15,000 to PLN 25,000 gross and the members of each committee of the Supervisory Board for the performance of the duties from PLN 2,000 to 3,000 gross and the additional monthly remuneration as Chairman of each committee of the Supervisory Board on the top of the remuneration received to perform the function of the Supervisory Board is PLN gross for the performance of their duties in addition to the remuneration for being a member of such committee.

So are there any comments on this resolution? I can't see any. So I order the vote on -- by secret ballot on resolution #4.

[Voting]

[Interpreted] Thank you for the votes cast. The votes for, yes, 476,734,847, against 28,340,138. There were no abstentions. Therefore, this resolution obtained the required majority and was adopted under the secret ballot.

Now I move to the next point on the agenda is adoption of the resolution regarding amendments to the Articles of Association of the company and the adoption of the new consolidated text of the Articles of Association of the company. So this is resolution #5. And here, we have 3 competitive drafts. So I will present historically speaking these drafts. So we have the preliminary draft of the resolution, which was submitted by the Management Board of the company displayed on the company's website on 16th of March 2026, along with the announcement of calling the extraordinary meeting.

Then on the 19th of March 2026, one of the shareholders, Open Pension Fund PZU Zlota Jesien submitted its draft resolution to point #7. And this draft was published in the current report on the 24th of March 2026. And this draft repeats the majority of the amendments to the statute to the Articles of Association proposed by the Management Board and adds to Article 9 Section 7. And this draft resolution was positively opinionated by the Supervisory Board of the company.

Then on the 13th of April, it means yesterday, one of the shareholders, Allianz Polska Open Pension Fund also submitted the draft resolution to point #7 of the agenda on the same day, it means yesterday. Also this current report was published regarding also the submission of this draft resolution. So I hope that everyone managed to read that draft resolution. This draft resolution also repeats the majority of the proposed amendments contained in the Management Board proposal and then modified in PZU draft that also contains further changes. I will not elaborate on them in detail now.

So we have 3 drafts, the Management Board's report, the PZU draft and Allianz draft. And in line with the regulations of putting the such drafts under vote. So in the first run, I will put under a vote Allianz draft, the most complete one. And if this draft does not get the required majority of votes, so then I will put under vote the next draft proposed by PZU. And if this draft also is not obtaining the required majority, I will put under vote the draft proposed by the Management Board.

So the adoption of the resolution exhausts this point. And if it is done, I will move to the next point on the agenda. So the required majority for this resolution is 3/4. Has anyone has any objections or wants to contribute to the discussion about these drafts? I can't see. So I would draw your attention to some minor technical issues because each of these drafts contains some technical inconsistencies. I will present them so that we can put them in the protocol so that you can adopt resolutions, which contain the consolidated text of the Articles of Association, reflecting the changes proposed.

So first of all, I will put under vote the Allianz draft. And here, I would like to draw your attention to the fact that -- so the proposed consolidated text is attached to the draft and this consolidated text in Article 11, Section 7, there is inconsistency between what is the proposed amendment and what is in the consolidated text, namely, so the expression, which is in brackets, if exists, should refer not to the authorized shareholder as it is indicated in the consolidated text but to the controlling shareholder. So this is at the end, one line below.

So in the resolution, it is correct. And in the consolidated text, there is a discrepancy. And I understand that you agree that I will put under vote this resolution, which will contain the correct consolidated text. Are there any reservations to this? So I open the vote on the draft, resolution #5, proposed by Allianz Open Pension Fund proposed on the 13th of April, namely yesterday. Please cast your votes on this proposed draft.

[Voting]

[Interpreted] Thank you very much for your votes cast. I would like to inform you that for, yes, 140,194,455 votes against 359,528,880 and abstentions, 5,351,650. So this draft resolution did not get the required majority of the votes and this resolution hasn't been adopted.

And therefore, I will move to the vote on the next draft resolution. This is the draft resolution proposed by PZU Zlota Jesien Open Pension Fund proposed on the 19th of March. And also, I would like to draw your attention here to the same discrepancy between the wording of the resolution and the consolidated text. So this expression if exists, should refer to the controlling shareholder, not to the authorized shareholder. Also this -- we put here the resolution with this corrected discrepancy.

And the second obvious discrepancy, which is in the draft that we identified is in Article 10, Section 1 between point B and C. So the paragraph is ended with the word dates and enter shouldn't be there. So this point should start from granting and -- so this is formatting error. Any objections to this amendment? I can't see any. So I would like to ask you whether you would like to contribute to the discussion on this draft resolution. No, I can't see any contributor. So I will open the ballot, the open ballot on resolution #5 on the draft resolution proposed by PZU Open Pension Fund. So please cast your votes.

[Voting]

[Interpreted] So the 4 resolutions have been adopted. And now we have the vote and the resolution was not adopted. So there is no resolution #5 because that previous draft was not adopted. So still, we are voting on resolution #5. The next draft for this resolution #5 proposed by PZU Open Pension Fund.

[Voting]

[Interpreted] Thank you for your vote. And for yes, 437,354,945 votes for yes, which represents 86.59% of the votes cast. There were no votes against and abstentions, 67,720,040.

I would like to say that this draft obtained the required majority of 3/4 in line with the Commercial Companies Code and Resolution #5 was adopted in line with this draft.

Therefore, I would like to confirm that the points on the agenda were exhausted, and I close today's Extraordinary General Meeting of Shareholders. Thank you very much for your attention.

[Portions of this transcript that are marked [Interpreted] were spoken by an interpreter present on the live call.]

Hello, and welcome, everyone, to the GTC Q3 2025 Results Webinar. My name is Becky, and I will be your operator today. [Operator Instructions]

I will now hand over to your GTC host, Botond Rencz, CEO; Jacek Baginski, CFO; and Michal Kuzawinski, Head of Investor Relations. Botond, please go ahead.

Thank you very much, Becky, for the kind and warm introduction. And I would like to welcome everybody for our Q3 results call. I'm really honored and privileged. For me, this is the first call that we are having as a CEO of the company. And I'm also very happy that I have Jacek with myself, sitting together. We are a new team. We are a new team with the two other management Board members. We have a lot of experience, and we also represent a very good, a different country representation where our operations are located. This new team is international and very much focused and interested in driving the future of the GTC company.

This is also a new chapter for us and for the company as well. And last week, we decided to go for a 3-day strategy discussion to discuss our priorities, discuss what are the immediate critical items that we need to think about and also reflect a little bit where we would like to go in the coming months and years. Now I can confirm the most important message or messages from this meeting. One, we would like to continue deleveraging our company. We would like to continue with asset sales. And also, we will be very much focused on cost and efficiency improvements.

As far as today's agenda is concerned, I would like to give you a little bit of an overall picture of our financial performance, and I would like the team to maybe turn to the slide where we can show the results. After that, I will like to ask Jacek to give a little bit more details about our financial performance, and then we are going to go more into details. So can I have the slide, please?

Basically, what I can say is that the last quarter represented mixed results for GTC. On one hand, the revenues were increasing, which is a positive phenomenon. On the other hand, when you look at the revenue increase, it has two different directions. One, we, in this year, incorporated our German acquisition revenues, which show a 9% overall growth. But without Germany, unfortunately, we are minus 4%, which is a reflection of us selling some of our income-generating assets.

When I look at our profitability, it is not showing such a positive result, and this is mainly due to the German acquisition, where we are experiencing quite significant financing costs, and our overall efficiency and profitability is not that strong.

Where we did very good in the last quarter, we were very successful with our bond refinancing program. And I think that was the most relevant and important action and task for us in the last quarter, which doesn't mean that we are not going to have some further refinancing needs in the coming half year. But I think this was probably our largest debt. So for us, it was extremely important that we successfully refinance it. Now with all of the refinancing happening nowadays in our industry and also in other industries, the new cost of finance will be a little bit more expensive. But talking to our lenders, the banks, they feel very comfortable actually supporting us in the future as well.

As I mentioned a little bit before, the end result for us is to continue our deleveraging process, selling some of our assets, but also making quite some steps in improving our operational excellence and cost control.

And I think that is, I would say, probably the right time for us to give, so to speak, the mic to Jacek because we have spent a lot of time already on budgets.

Okay. Hello, guys. So Botond has already reported on the performance of ours for the period ending September. Obviously, I just want to highlight the successful story around the refinancing of the bonds, which is behind us. I will talk about these next steps with the bonds in a moment. Other parameters, obviously, are more or less flat, but I will talk about them in a minute. So Michal, if you can turn on another slide.

In regard of the bond refinancing, I hope you were following the story. We managed to refinance or to issue the new bonds for the amount of EUR 455 million, out of which we received EUR 430 million cash, and we utilized that cash partially to buy the outstanding bonds for the amount of EUR 195 million. The balance of cash from the issue of new bonds is deposited on the escrow account pledged to the benefit of new bondholders. And that balance together with the balance of cash that we keep on the balance sheet of the company will be good enough to buy back the outstanding bonds, which is going to happen by the end of Q1 2026. Michal, if you can flip on the next slide.

On portfolio, so nothing really changed from the last quarters. This is obviously the picture already after the acquisition of the German portfolio. So again, 88% of the portfolio is the income generating, out of which you can see on the left side on the bottom, we have the majority of our assets are office, retail and residential portfolio purchased in Germany. Michal, if you can flip on another slide, please.

On performance of the office portfolio, nothing really changed comparing to the last 9 months of 2024, you see certain drop of -- on occupancy in Hungary that is offset by increase of occupancy in Poland. The weighted average lease is around the same, 3.6 years, as it was last year. The good thing is basically the leasing activity, if you look at the overall business for the -- in Q3 this year, the company managed to lease approximately 27,000 square meters. Next slide, please.

Retail portfolio, as in the previous quarters, it's doing well. It's fully occupied. There is some potential of increased occupancy in Poland, in Galeria Polnocna. But again, the weighted average lease remained the same, around 4 years. And the company is able to extend and lease the remaining space, which is seen here, the company managed to lease the 15,000 square meters of space in Q3 2025. Next slide, please.

German portfolio, we purchased it, as you all know, at the end of last year. Here, what you can see, obviously, there is a slight increase of the occupancy from 83% to 86%, which is, I would think, a good direction. Still, there is a lot of to do in regard of the occupancy in this German portfolio. The annualizing rent [ in-place ] is stable, around EUR 24 million. Next slide, please.

On the results, so looking at the rental from -- the revenue from rental activity as Botond was mentioning, we are seeing an increase comparing to first 9 months of 2024. But excluding the Germany, it's a decrease by 4%, mainly driven by the fact that we sold some office buildings in course of 2025.

On the other hand, we recorded increase of the cost of the rental operations, so simply property expenses, by 8%. This is again without Germany. This is something that we are looking in depth and Botond was mentioning about it already at the beginning that this is one of the issues that we are dealing with among many others to have these costs under control.

Then looking at EBITDA and already on consolidated basis, we see a drop from EUR 84 million to EUR 77 million. It's mainly driven by the -- again, by the fact of the disposal of a part of the assets, the office buildings, but also there is a substantial increase of the property expenses, administrative expenses. This is again mainly driven by the consolidation of the business with acquisition of portfolio of the German assets.

Profit, there is below EBITDA, you see an important increase of the expense related to the revaluation of the assets. This is mainly driven by the fact that we incurred certain CapEx for the fit-outs and maintenance of the buildings, which did not contribute to the value of that building. So it was expensed. Also, we expensed some option -- cost of the option related to the acquisition of the shares in German portfolio. So the combination of the two elements resulted of that loss of EUR 45 million from, I would say, investing activity.

Then below, again, something that we anticipated, but it's seen here in line finance cost, which is a substantial increase of the finance cost is mainly driven by the consolidation of the financing that was drawn to finance the acquisition of the German portfolio.

So overall, the company incurred a loss of EUR 28 million for the given period comparing to the profit of EUR 41 million last year. Next slide, please.

On cash flow, obviously, on the cash flow from operating activities is flat with last year. Then below, investment activity, you can see here that the company fortunately reduced its investment activity, which is mainly CapEx related to some developments, but also CapEx spend for fit-outs and maintenance of the CapEx. At the same time, the company sold a number of assets for EUR 100 million. There is another outflow that you already noticed in the past periods of EUR 45 million, which is related to the settlement of the price for the acquisition of the German portfolio for EUR 45 million, and there is EUR 44 million, I would say, accounting [ entry ], which is nothing else like basically moving cash from the investing activity to the deposit account.

Obviously, I already mentioned about it, the interest expense went significantly up from EUR 28 million to EUR 50 million, but it's related to the acquisition of the German portfolio. Next slide, please.

On the balance sheet, nothing unusual except of maybe the line #2. You see the drop of the asset held for sale. This results from the fact that, as you remember from the previous slide, a substantial amount of assets were sold in course of 2025. But as Botond was mentioning at the beginning, we are working on the list of the assets that we will dispose in course of 2026 in order to deleverage the company, and you will see most likely at the end of the year, the increase of that number, assets held for sale, since we'll be able to provide the market with, I would say, more indicative number of how many assets and how much we want to generate out of disposal in the course of 2026. Next slide, please.

And our debt position, obviously, here, you still see the picture of the balance sheet before refinancing of the bonds. So there is a substantial increase of the short-term financing from EUR 220 million to EUR 860 million. That obviously at most was dealt with because of the refinancing of the bonds. But still, there is approximately EUR 400 million of financing to be refinanced. Next slide, please.

This is what you can see on that graph on the right side. So basically, we refinanced close to EUR 500 million Eurobonds by issuing new bonds and that you saw proceeds from the issue of new bonds in combination of the cash that we keep on balance sheet will allow us to redeem all the outstanding bonds by the end of Q1 2026.

In regard of the remaining EUR 350 million of the refinancing. This is asset-backed financing. As you can see, there's basically three jurisdictions that this financing was drawn and will be maturing in course of 2026 is Germany; EUR 124 million loans, Polish entities and -- Hungarian entities and Polish entities. So -- but again, what was said at the beginning, we are very well advanced with the discussions with the lenders. Some of them provided us with the term sheets. Some of them provided us with the credit decision. So we are working towards the extension or finalization of that process of extending the loans by the end of Q1 2026. Next slide.

Thank you very much, Jacek. I think now probably this is the time for us to ask questions, Michal.

Yes. Thank you, Botond, and good afternoon, everybody. Michal Kuzawinski, Head of Investor Relations at GTC. I have pleasure to be your host for the Q&A session. [Operator Instructions]

Meanwhile, I received the first question from David Sharma from Trigon. The question is, could you please walk us through GTC short-term FFO assumptions following bonds refinancing? What is our targeted FFO run rate following recent divestments and refinancing?

So as it was said first, I would say a couple of comments on the FFO going forward. So first, we recognize the need of the reduction of LTV and the interest expense related to that. Obviously, at the first instance, we will focus on the refinancing, on the repayment of the most expensive loans. And we will be dealing with that in course of 2026. That would result in the decrease of that interest expense, again, but this will be seen only, I think, in the second part of 2026 or even in 2027. That process of, again, disposal and the repayment, the reduction of the most expensive debt will take us easily a year or more. Then obviously, this is point number one.

Point number two is operating activity. As Botond was saying, the reduction of operating expenses is of the key importance, but also the fact that our vacancy or vacancy on our portfolio is still substantial, and it applies to really to office portfolio and the German asset portfolio. There is, I would say, a substantial work that we need to do in order to increase it and then increase the rental income from that portfolios of assets.

So it's not, I would say, a simple answer to the question, what would be our running FFO, right? We need to look at that, and we'll be looking at that within the next couple of months. By the way, we are well advanced in the budgeting process for next year, where we actually engaged the entire company in all the jurisdictions to work on that plan. We already see certain improvement of EBITDA in all jurisdictions comparing to the actual results that we anticipate to record in 2025. But again, that improvement will take time, and we only will be able to really to discuss the FFO run rate in a more detailed way by the time when we will publish the results for 2025, will be sometime in March 2026.

Thank you, Jacek. Olivier Monnoyeur from BNP Paribas has a follow-up question. Olivier would like to know some more details about the German debt. So the composition, the maturity, the call date and how advanced the company is in the process of disposing part of the German portfolio?

Okay. So on the debt side, basically, let's say, that part consists of two -- I would say, two segments, the senior loans and the loan provided by the party that actually financed the -- a chunk of the purchase price for -- that allow GTC to buy the portfolio.

So in regard to the senior loans, there are two German lenders that we work with. The discussions are well advanced. We were greenlighted in regard to the extension of that EUR 140 million loans. We'll be receiving term sheets from this lender -- term sheet from the lender this week. Again, so the discussions will take some time on conclusion and signing the extension. But as I said, we aim to sign and to extend the loan that is terminating at the end of this year, sometime in Q1. So what is going to happen, the current lender will give us the extension of the loan for the next 3 to 6 months for us -- to give us enough time to sign the new loan agreement with another lender that will refinance the current lender.

So this is, I would say, on the front of the senior loan. And there is obviously that loan that we drawn in order to finance the acquisition. It's a 5-year loan. The loan was drawn at the end of 2024. So it's still for 4 years outstanding.

Thank you, Jacek. And we have more questions about Germany. So I'll try to put all the questions in this context. Now we have from Andrew [ Edmondson ]. Gross margin from Germany was EUR 11 million, but admin expenses increased by EUR 8 million year-on-year, mainly because of Germany. Then there are significant debt interest expenses related to Germany. Please talk through this in greater detail. What needs to happen to bring this back to profitability?

Three things have to happen. First, on the top line, as I said, you saw on the slide, there is 85%, 86% of occupancy. There's still room to improve, which will take some time, but that's something that we are working on to increase it substantially.

Second thing is the property expenses, which are relatively high comparing to our portfolio. Again, since the company purchased this portfolio only at the beginning of this year. And still, the management of this portfolio is organized in the way that it's done by the seller, by the previous owner of the property, so we try -- we are in the process of taking over the asset management and property management from the seller, which is going to happen in course of 2026. And in consequence, we anticipate certain decrease of the property expenses, which will increase the NOI. Again, this is a process that will take us easily 1 year to improve.

Then on the financing side, as you rightly noticed, the substantial increase of the cost. This can only be reduced by the repayment, partial repayment or full repayment of the loan that was provided to finance that acquisition. Again, there are -- the major source of obviously, of the repayment would be to start selling the German portfolio. But again, we are looking at that right now. We do not want to commit on the timing of this process. We simply still need more time to understand how quickly we can improve the performance of the portfolio increase -- in order to increase its value before certain decisions on the disposal will be taken.

Thank you, Jacek. We have also a follow-up question from Olivier on Germany. Olivier is reminding us that we have not answered the question about advancement in the process of selling part of the portfolio. If we can give an update where we are in selling the residential units in Germany.

I already answered to someone else that we are analyzing basically different scenarios and of -- let's say, and different strategies of selling that portfolio or part of the portfolio, we recognize the importance of the reduction of LTV and a decrease of this finance costs related to the loan provided to finance the acquisition. But again, it's too early for us to talk about the details of the phasing or the volumes of the assets that we will sell in course of 2026. I can only say that we will be able to talk more about it during our presentation of the final results for this year, which will be sometime in March next year.

But I think we can also say that we are working with potential buyers and agents who are interested in the portfolio, but we are not ready yet to commit the deals.

Olivier is also asking about the interest rate of the senior loan. Olivier, we don't disclose the interest rates on particular funding sources, but we did disclose the average weighted interest rate of about 3.8% for the 9 months.

And the next question is from [ Vicki Chen. ] Vicki is wondering if -- when are we going to start paying dividends again. And also asks for a detailed outlook on the asset sales program in 2026.

Okay. Maybe this question I would answer. I think both are very good questions. I would say the first question relating to the dividend payments. I mean, I think it's very clear for us that there are certain priorities that we would like to make sure that they are delivered. And for us, it's really making sure that we are finishing the journey on the refinancing. And once we are finishing that journey, also, we are deleveraging our assets.

Until that is done to the extent, I feel it's very comfortably that we can pay a dividend. I would not like to commit to any date in terms of dividend payments. But definitely, 2026 is not going to be a year where we are going to pay dividends. And from when, I think we are actually, as I mentioned, started our strategy directions with the management team. We still need quite some time to finalize it at the moment for us, the real challenge is what I have just basically said. So that was the dividends.

The question on the 2026 portfolio sale. Now I don't want to be unpolite, but for me, this is probably one of the most confidential information that we can have because believe it or not, there are a lot of companies and people are coming to us asking this question and trying to get some of our assets. Obviously, sometimes it is cheaper than what we think is the right level of compensation. So for me, this is very confidential what and how we would like to kind of sell because we would like to make sure that we get the maximum return for our investors and lenders, and that actually requires quite some tactical approach on our side. I hope you understand that.

So we have no more questions at this point. [Operator Instructions] Maybe let's -- I propose to allow a minute to check if any more questions appear.

But I think we can also say that in case new questions pop up, please feel free to contact us after the call.

It's also a good idea. So with that, Botond, I pass the voice over to you for concluding remarks.

First of all, thank you very much for joining this call. I hope we managed to shed some light on our current status, our current business and the directions. I would like to thank Jacek and yourself as well for the information.

For me, what is the most important that we are truly committed to the future success of this company. And we are very conservative in that respect. And for us, the financial goals and also the goals for improving our business is equally critical. I think that we are very close to finishing our fourth quarter, and I really would like to come and see you again and talk to you again after our fourth quarter is finished and we can actually finish the year. So thank you very much for joining and looking forward to -- I wouldn't say seeing you because you can see us, we cannot see you now, but let's say, talking to each other next time.

Thank you. And we received no questions -- no more questions. If you still want to ask a question, you can please e-mail or call us. And thank you, gentlemen. Thank you, everybody, for joining this call. And see you again next year when we report our annual earnings. Goodbye.

Thank you.

Thank you.

This concludes today's webinar. Thank you, everyone. You may now disconnect your lines.

Hello, everybody, and welcome to the GTC H1 2025 Results Call. My name is Charlie and I'll be your coordinator today. [Operator Instructions].

I'd now like to turn the call over to Malgosia Czaplicka, CEO of GTC to begin. Malgosia, please go ahead.

Thank you very much, Charlie. Good afternoon, ladies and gentlemen. It's my pleasure to welcome you today on the GTC's call related to the first half of 2025 results. Today, I'm joined by Balazs Gosztonyi, who is the CFO of GTC, but it's also my pleasure to introduce our new IR person who will remain your contact person for the future, it's [indiscernible].

Thank you, Malgorzata, and good afternoon, everybody. I'm very pleased to join GTC as the new Head of Investor Relations and Corporate Governance, and I look forward to working with all of you and keep the open and transparent dialogue with the market as well as support the management team in executing the strategic goals. Thank you.

Thanks, [indiscernible]. I think we can now move to the presentation. So I will put the presentation on the screen. Of course, the presentation is available on the website. But let me start with a short summary of what happened during the first half of 2025.

So the rental revenues from -- went up by around 9%. We crossed EUR 101 million in the first half of 2025. This is mostly due to the addition of the German residential portfolio to the overall portfolio. The gross margin from rental activity were at EUR 66.1 million. This is a little bit above what we achieved in the first half of 2024. Our FFO was at the level of EUR 22.6 million. This is mostly due to higher financial costs and Balazs will tell you a bit more in detail how the financial costs increased and what were the reasons for that increase. If you look at the EPRA NTA, we are more or less flat compared to the year-end. EPRA NTA per share stands at EUR 2.23 or PLN 9.63.

If you look at the net LTV, we went down to 51.8%. Occupancy, we are very proud to say that the occupancy of the commercial portfolio stays unchanged from the year-end. We do believe that the bottom in terms of the occupancy is behind us. We do believe it was in the first half of 2024. I will tell you a little bit more on the occupancy of different sectors in a minute. If you look at our cash position at the end of second quarter, it was around EUR 80 million of unrestricted cash. We had around EUR 22 million on the escrow account, and we have deposits of around EUR 45 million. And this is all before the new senior loan for Galeria Jurajska was fully drawn in July 2025. This is the loan of around EUR 84 million. And this is before the exercise of the option to acquire noncontrolling stake in the German residential portfolio which we exercised in mid of July, and we paid the remaining purchase price of around EUR 42 million.

Moving forward, talking a little bit about the portfolio. I think that the portfolio structure has not changed significantly. We are still holding around EUR 2.9 million of total investment portfolio, out of which the income or the -- real estate portfolio is EUR 2.7 million, and the income generating portfolio is around EUR 2.4 million.

For me, the most important for the time being, would be the income-generating portfolio. As you see, we again are having around 51% in offices, around 30% in retail and around 19% in residential. Around 88% of the portfolio is income generating from the total investment portfolio. We have active development of around 6%. That is roughly a few products that we have up and running, few -- 3 projects in Budapest, 1 project in Zagreb. We have around 95% of our portfolio in EU countries, out of which 51% is in A-rated countries.

In terms of the green certification for the portfolio, 93% of our commercial income generating portfolio is green certified. Another 5% is under the certification. And of course, we are working very hard to uplift the energy efficiency of the German residential portfolio. This is our main task, and that's what we are focusing on. You saw the communication of the cooperation with PAUL Tech earlier this year, [ we leased ] earlier this year. This is the route that we are taking of this portfolio.

Talking a little bit more into details about the office portfolio and the occupancy stabilized. The occupancy is at the level of 82%. The average weighted lease term is around 3.6 years. We had robust activity -- leasing activity we leased during the first half of this year, around 40,000 square meters. We had some big leases. We did some big leases across all the markets, as you see in the icons below, it's from Warsaw to Zagreb, all the leases are bigger ones and visible. We are pretty satisfied. We do still see some weakness or some softness in the Polish regional cities, that's where our occupancy is the lowest. That's mostly 2 cities. It's the city of [indiscernible] and the city of [ Katowice ] where our portfolio are characterized by the lowest occupancy in the portfolio.

If we switch to the retail portfolio, here, I mean, not significant changes. We are still almost fully occupied at the 96% of occupancy. You'll see that some of the assets are almost at its full capacity. The average weighted lease term is of around 3.5 years. We do have some leasing activity. We leased around 16,000 square meters. And again, that's throughout the whole portfolio. We don't have any assets that would show any weaknesses in that portfolio, none of the cities, none of the markets, none of the assets.

To kind of confirm that you will see on the slide, the footfall and the tenant turnover, we are comparing it Q2 to Q2 2025, but also on a semiannual basis. So you see that all the properties are having a footfall at a very stable and increasing trends. And of course, the tenants turnovers are extremely -- on an extremely positive trends across the market. Even if you see that there is a small footfall decline like in Croatia, coming mostly from the fact that there is Sunday trade ban introduced last year, you see that, that actually translated into much better sales.

A few words about the residential portfolio. We are working, as I said, on the energy efficiency of this portfolio. We are bringing the portfolio from the energy efficiency of the [ D or E ] to energy efficiency of A&B. We are doing that together with a company called PAUL Tech, it will be CapEx neutral. There will be no CapEx investment as initially set at the acquisition announcement. We will invest CapEx on -- in the part of the portfolio that we plan to keep longer term. We did have some good progress with the occupancy. As you see, we acquired the portfolio, it was around 83% occupied. At the end of Q2, it was already 86% occupied. We do see that the average headline rental rate is going up slowly, and we do see that the annualized in-place rent is also slowly going up.

Our strategy towards this portfolio has not changed. As you probably realized, with the recent announcements, we are -- we decided to enlarge and to strengthen the management Board with an additional personnel. Sebastian joined GTC's Management Board as of today and his main focus and his main responsibility will be the exercise of the strategy in the German residential market.

With that, I will be happy to give the floor to Balazs to take you through the financial results.

Thank you, Malgosia. In line with what Malgosia said, let me present you the P&L of GTC first. So we do have an improvement on the revenue side compared to last year, which giving you a little bit more detail on the like-for-like level, we managed to increase our rent of the core portfolio by EUR 0.6 million in the first half of the year. And as the residential occupancy improved, we managed to increase the annualized residential revenue expectation by approximately 5%, that's resulted the EUR 101 million of revenue from rental activity. The cost of rental operations increased as well, which is partially due to -- at the later stage of the year scheduled reconciliation of the service charges which altogether gave us a 1.5% increase in the gross margin from operations.

We recognized an increased administration expenses that are partially due to the new operations in Germany and in Luxembourg as well as inflation effect on the core operations. The profit -- actually the loss that you can see on the revaluation of assets are standing at EUR 14 million at the end of H1 2025, that's mainly due corrective values in the Hungarian portfolio, partially offset by improvements in Bulgaria, Germany and Croatia.

This leads to our major operations profit to slightly decrease to EUR 40 million from operation before finance income and tax. And as we are recognizing EUR 36 million of finance cost in the first half of the year, that's a significant increase compared to last year. That is due to the acquisition we closed at the end of December in Germany and also the refinancing that we secured specifically in Jurajska at a little bit higher rate than the previous financing that was taken 5 years ago when they -- when the market conditions were much lower. We are focusing on managing these finance costs. We are aware of the increase of the weighted average interest rate as well, and the management intends to keep that at bay even after the refinancing of the upcoming maturities. Mistakes are profit for the period for close to EUR 0, EUR 0.5 million for the first half of the year, but we can show a stable EBITDA standing at 45 -- sorry, EUR 54 million at the end of H1.

So moving on -- so moving on to the cash flow. The previously mentioned effects are reflected in our cash flow as well. As Malgosia mentioned, we have stable operating performance. Currently, the cash flow from operating activities resulted in EUR 45 million of the first half of the year. On the investment activities, we had significant movements due to the investment that are ongoing as well as the sale of assets in the portfolio that were closed in Q1 2025, and you see the combined effect.

As you see, we slightly decreased our year-to-year comparison, the investment in real estate and related slightly decreased, that's due to the fact that the started developments are nearing completion. And due to the newly signed leases, we spend a larger portion of the investment on fit-outs that are basically matching the improvement in the occupancy of the portfolio. The sale of investments of EUR 88 million, that's covering the 3 transactions that we announced selling of the plot in Warsaw, the Matrix C building in Croatia and the GTC X office building in Serbia.

Besides the investments, the financing cash flow is in line with what I mentioned before the interest payments are increasing, that's in line with the pre-lease expectations as the refinancing and the additional financing are taken on by the residential acquisition in Germany are increasing compared to H1 2024. We also managed to close a little bit higher repayment of long-term borrowings. There was a one-off repayment in Hungary, where we repaid EUR 6 million additional to the scheduled refinancing to improve GTC's position on the long-term borrowings. This gives us on the year-end -- or sorry, the period end EUR 80 million of cash available for the company.

Coming to the balance sheet. Our investment properties slightly changed. That's due to the developments I mentioned earlier, constructions as well as the CapEx and fit-out investments, realized in the first half of 2025. The previously mentioned disposals had an effect of the line assets held for sale. Basically, these are the 3 transactions I mentioned earlier. And obviously, these disposals offset by the investments had a positive effect on cash and cash equivalents in 2025 H1. All in all, the balance sheet is stable and shows that we are continuing the strategy management intends to implement.

The same events show the effects in the liability side of the balance sheet. So basically, we managed to close the transaction that had a positive effect on the liabilities related to assets held for sale and also, we reclassified along with certain financial facilities we reclassified from short term to -- sorry, from long term to short term a significant amount of facilities. We have a detailed slide in the coming slide to explain how this has been changed. Obviously, the short term that has increased due to the reclassification of the EUR 500 million outstanding bond of GTC, and as certain loan financings are coming to maturity reclassification had an effect on top of the bond and the EUR 500 million bond.

If we jump to the, let's say credit metrics of GTC, you see that because of the reclassification that actually the maturity dates are coming, our weighted average debt maturity decreased from 3.3 years from year-end to 2.7 years in H1. This is obviously underlines the focus of the management to refinance or extend the facilities that we have on hand.

Before jumping into details of the outstanding debt, I would like to mention that overall, the net LTV of the group decreased to 51.8%. And the before mentioned weighted average interest rate is on a positive -- on an increasing trend in H1 2025, it was reaching 3.68%, that's still although negative trend, but it's still very nice compared to, let's say, market averages.

And as I mentioned regarding the refinancing focus, the EUR 500 million bond is outstanding at the end of June 2026. GTC has selected JPMorgan to lead that refinancing and the process has started as per our announcement. Beyond the euro bond, we have several senior facilities, project financings that are maturing in the next 12 months. Specifically, there is a bit more than EUR 100 million related to Hungarian assets, there's about EUR 100 million related to the German portfolio, and there's EUR 80 million related to the Polish portfolio.

As all of these financing facilities are under scrutiny, and we are in discussion with the banks and investors to refinance, all of these are being attended and we are positive that the refinancings will be closed or extended ahead of their maturities. Of course, these numbers, as mentioned earlier, are not including the facility that we secured on Galeria Polnocna. They will be reported in detail and will be part of the key metrics in the Q3 reporting.

To be just kind of conclusive besides the upcoming debt maturities, I believe that all of these facilities are being attended, the business performance has been strong. We managed to improve on the rental rate and that shows the strength of the portfolio and with the upcoming maturities being addressed, we are positive that the financial position of GTC will be improved.

And from my end, thank you. Thank you for your attention. Over to you, Malgosia.

Charlie, we are ready for the Q&A session.

[Operator Instructions]. Our first question comes from Jakub Caithaml.

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I cannot hear you.

[Operator Instructions]. Our next question comes from [ Alexander Rodonski ] of [indiscernible].

I have like 2 or 3 questions. First question is about the time line for selling assets ahead of the coming bond refinancing. Is there some kind of -- is there some kind of time line for that, that you can share?

As you see, we already sold 3 assets this year. We have 2 more assets under the final, let's say, agreement. I can confirm that one of the assets was closed today. We have a number of assets that we are planning to dispose. At this stage, I would rather not comment on the disposal time line.

Okay. Okay. And another question is about the EBIT margin on the residential portfolio. If you can share that maybe or not?

Balazs, this is a question for you.

We do not publish subsegment EBITDA margins to my -- so far. Therefore, I'm unfortunately not able to provide you EBITDA margin on the German portfolio, the separate, let's say, subsection of our portfolio. We do provide group level EBITDA margins only.

Okay. Okay. I understood. So maybe can you elaborate about the renovations in the newly acquired apartments? Have they already begun? And what impact will they have or do they have on the rental activity and revenue?

It's a little bit -- I would say differently. What we've done on the German portfolio so far, we split the portfolio into the assets that we are planning to keep and we split this -- and we selected those assets that we are planning to dispose. We are not planning to do any significant CapEx on the part that we are planning to dispose. We have a very strict plan for the assets that we are planning to keep. We will start renovation at the end of this year. This year, you should see some small CapEx spend on those assets towards the end of the year. The majority of CapEx spend will be in 2026 and 2027, that's due to the fact that this will -- this will be financed by the subsidized financing.

We are under consideration for the 2 different options is either the subsidized loans, which are called [indiscernible] or the [ BAFA ] program, which -- where the subsidy is on the money spent. There is no subsidized loan, but you are being reimbursed for 1/4 of the cost spend on the improvement of the property. That's how the German market works in this respect. And for that, we need to properly prepare all the documentation to be able to apply for any of those programs.

For the remaining -- for the whole portfolio, what we are doing is we are doing certain improvements or change of some systems in a way to allow these properties to be energy efficiency. We acquired [indiscernible] energy efficiency of around D or E depends on the property and with special technology that is invented by PAUL Tech and is being provided by them, we will improve those assets to the energy efficiency of B or A, that will not have an impact on the revenue stream. Only the improvement in -- where the CapEx is spent can be translated into improvement in the rental rates based on the German regulations. So I would say that probably you should see some improvement in the rental rates coming from CapEx spend only in 2026, let's say, second part of 2026, beginning of '27.

[Operator Instructions],. And we do have a follow-up from Jakub Caithaml.

Again is the line better now?

No, it's not.

Okay. Sorry. I'll [indiscernible].

Might be a little bit better, Jakub, but it's not fully clear. So you can try...

Let me try. I wanted to ask about maintenance CapEx outlook for the upcoming 12 months because we have seen a significant deceleration between first and second quarter.

But you're looking at the development costs, right? The investment in real estate when you had a significant amount in the first half and much less in the second half -- significant amount in Q1 and much less in Q2?

Exactly. I was -- one thing to ask how do you see this CapEx item developing in the coming 6 to 12 months?

Jakub, this is not really the maintenance CapEx. This is the development CapEx that we decided to cut back as one of the measures to improve our cash position. So as you know, we decided to -- we had few properties under construction, we decided to slow down certain developments and bring them up to speed with the leasing before we continue spending money on them, that's relevant for all 3 properties in the Hungarian market.

And the only property that we are developing right now is [ Matrix D in ] developing in the normal speed is [ Matrix D ] in Croatia. The maintenance CapEx on a regular annual basis for the commercial real estate portfolio is between EUR 10 million to EUR 15 million and that's what we will be -- we will be spending anyway on that part of the CapEx, we are not cutting back.

I see. And this EUR 10 million to EUR 15 million includes the capitalized expenses for new leasing or that would be coming on top?

That would be coming on top, that will be from the fit-out line.

Understood. My second question was on the talks with the creditors, both on the bond side and on the other liabilities coming due in the next 12 months? I mean could you give us any color on how these talks are proceeding? Or if you think that you will be able to meet the time line indicated in the last picture?

Sure. I will take over the bonds part and then let Balazs to speak about the senior debt. So the bonds, as Balazs mentioned in his speech, we mandated JPMorgan to work with us on the capital markets transaction. We do believe that we can deliver the transaction and the time line, which is in the [ Fitch ] report. We remain in a close dialogue with both -- with the majority of our bondholders. And those negotiations are progressing, and they are moving forward. We do believe that -- at the end of the day, the capital market transaction will be of our focus and will be the final outcome of the exercise.

And regarding the upcoming maturities on the loan side, we have very strong relations with all around the portfolio. We have more than 20 banks with whom we are continuously working to acquire new loans or extend the current ones. And these strong regulations and the conversations, we are continuously keeping taps on gives us confidence that the roll forward or refinancing of the upcoming maturities will be handled. I believe the strength of the portfolio is also underlined by the fact that we were able to sort of onboard the new bank in our network that's underlined by the [ J&T ] facility, we were able to secure post balance sheet date.

I think that so far -- or maybe beyond that, so far, we were very successful in rolling forward. So we do have a high expectation to be successful in this regard in the coming quarters.

And lastly, I understand that with the German minorities buyout completed? The office building Bookers has again become unencumbered? Could you give us a rough update on the current state of the standing unencumbered portfolio, please?

Jakub, this is correct. We never encumbered at the end of the day, City Gate, It was always unencumbered. We repaid the loan before we managed to encumber the asset. As this is a longer exercise, we will be happy to share the list of encumbered assets, but you have to give us time. We don't have it handy. If you look at the presentation, around 40% of our assets, [ 39% ] are unencumbered. So that gives you more or less the pool -- of the unencumbered assets, but to be honest, I don't remember asset by asset out of the portfolio, which are unencumbered and which are encumbered.

Our next question comes from David Sharma of Trigon.

Just a few questions from my side. Maybe the first one being -- could you please clarify which of the assets are about to be sold in the second part of the year? I believe it's going to be the Artico [indiscernible] and the plot in [ Katowice ] and how much of the proceeds are you expecting from those 2 transactions?

David, I can confirm that the plot in Katowice has been already sold. The plot in Warsaw has been already sold. I don't want to comment on the transactions which were not closed.

Right. Thank you. So maybe my second question would be the -- okay, we now see the top line expansion due to the consolidation of the resi in Germany. That being said, the biggest financial burden is basically in a way, your FFO. So where do you expect the FFO pickup to happen over the next 3 to 4 quarters? And do you expect the FFO to pick up prior to the [indiscernible] of the bonds and loans?

The FFO will pick up upon the realization of the disposal strategy in the German residential market and repayment of certain debt related to that acquisition. So I wouldn't say it's going to be this quarter or the next quarter, I would rather say that it should start improving [indiscernible] of next year.

Right. And do you -- where can we expect this first transaction to happen? So where do you expect this sub-portfolio of resi assets to get sold?

We are preparing them for sale as we speak. And we do believe that the first transaction if all goes well, can be still, let's say, in the first quarter of next year, but most probably towards third and fourth quarter of next year.

Right. So the last question would be anything about the Kildare campus, and I think about you sharing your sale in the JV?

Can you say again? I couldn't...

Yes. Yes, sure. What about your participation in the Kildare Innovation Campus in Ireland? What about your share in the project and where can we expect this disposal to take place?

Again, let the management to analyze whether this disposal is the best possible outcome for GTC. There are certain changes in this project which are extremely positive, and we have to evaluate the project again and to decide whether we would like to keep the project or sell the project. We, at this stage are at the analytical level of those assumptions. So you have to give us a little bit more time to come back to the market and tell you exactly what will be the plans of the company towards this project.

Right. And maybe -- well, last question, I promise. It would be about the overhead expansion. We can see that the G&A costs rose over 50% this quarter. Do you expect this pace to continue over the next 2 quarters or over the next 4 to 4 quarters? Or that was only, I would say, one-off transaction related to the redevelopment of the resi assets in Germany?

Balazs, if you can answer that question.

Certainly, I believe this is a one-off. The -- there is an element of the increase that will stay with us as we have additional operations now in Germany and in Luxembourg. However, this current reported figure already includes certain one-off items. So if operational efficiency and sort of the management of the new portfolio is taking on the GTC standards. We do not expect it to be growing significantly ideally, it will -- a worst case stay on that level.

Our next question comes from [ Alexander Rodonski ] of [indiscernible].

I was actually about to ask a question about SG&A and margins. So David asked it for me. So no more questions from my side.

Thank you very much. At this time, we have no further questions registered on the call. So I hand back over to the management team for any further or final remarks.

Thank you very much. Ladies and gentlemen, it was a pleasure to speak to you. As we announced at the very beginning, [ Mihaly and Baginski ] is at your disposal. If you have any additional questions, we will be happy to answer them offline. Thank you very much for your time. Goodbye.

Thank you.

Ladies and gentlemen, this concludes today's call. Thank you for joining. You may now disconnect your lines.