Unibail-Rodamco-Westfield: Company Overview and Financial Report

Learn about Unibail-Rodamco-Westfield, a commercial real estate company, and its financial report for the year 2018. Explore the company's history, mergers, acquisitions, shareholding structure, and share price performance.

Unibail-Rodamco-Westfield

Table of Content
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Introduction to the Company.....................................................................................................3
Section 1: The Materiality Used................................................................................................4
Section 2: The Complete report.................................................................................................6
Section 3: Traded Volumes......................................................................................................10
References................................................................................................................................12

Introduction to the Company
Unibail-Rodamco-Westfield SE is a commercial real estate company with its headquarters in
Paris and France. The historical background of the company originated with the formation of
two different shopping center operators namely, Unibail, which was founded in the year 1968
in France and Rodamco Europe, which was founded in the year 1999 in the Netherlands.
Now, these two merged in the year 2007 and formed to be called Societas Europea in the year
2009 (Unibail-Rodamco-Westfield, 2019).
The merger of the company took place with an Australian shopping center operator named
Westfield Corporation, which was a creation of the split of the Westfield Group in the year
2018.
According to the reports of 2018, Unibail Rodamco Westfield is a commercial real estate
company, established in Europe. It is also one of the components of the Euro Stoxx 50 stock
market index. The retail property, convention centres, and commercial buildings like offices
and complexes, are places in Europe and North America, which adds up to its portfolio.
There are several shopping centres, which were supposedly launched by the Westfield Group
using the Westfield brand in the year 1960 (Unibail-Rodamco-Westfield, 2019).
These were shared for properties with Scentre Group in both Australia and New Zealand
since the year 2014. It was then that the retail properties owned by Unibail Rodamco will
carry out the Westfield Name that is before the merger took place.
On the 10th April 2017 the Rodamco Europe announced an agreement in order to conduct an
equal merger with Unibail. This agreement marked as one of the largest publicly company in
Europe. This merger was confirmed on 21st June 2017. This was after the announcement was
made by Unibail for acquiring 80% of Rodamco’s shares. This also turned out to make the
offer for the remainder’s unconditional. After the merger, the entity came into effect as a

société anonymous, with the new name Unibail-Rodamco dated on 25th June 2007 (Thomas,
2019).
The former FNAC CEO Christophe Cuvillier was hired as the new COO of the Unibail
Rodamco dated on June 1, 2011Despite the tough economic conditions that were foreseen in
the market after the merger, the CEO in collaboration with the Board Guillaume Poitrinal led
the company for a five-year growth, bringing the company the name it has gained today. In
May 2015, it was made public by Unibail that it had signed an agreement with Canada
Pension Plan Investment Board. It was signed in order to sell its 46.1% stake in MFI AG,
which is a German shopping mall operator and it was worth €394 million (Unibail-Rodamco-
Westfield, 2019).
It was in December 2017 when Unibail took over Westfield Corporation, which once
operated in a total of 35 shopping centres established in the US and UK. These all together
reported a price of US $24.8 billion. The only centres that were kept out of the merger deal
were the Australian shopping centre, which was branded as Westfield and was also held by
Scentre. This deal was completed in Junie 2018. Also, the shopping centres, owned by
Unibail Rodamco had got their names changed in order to have the Westfield Brand.
Below is the financial report for the Unibail-Rodamco-Westfield for the year 2018. The
report is divided into three sections (Unibail-Rodamco-Westfield, 2019).
Section 1: The Materiality Used
After looking at the statistics of the previous year reports there is certain material that I
required in order to form the report. One of the most important aspects is the financial
accounts maintains by the company for the year 2018-2019. This will enable us to have an
overall idea of the graphs and the numbers that the organization is dealing with.

The materiality with respect to auditing represent the misstatements which include the
omissions as well since the Unibail-Rodamco-Westfield influences the economic decisions of
the uses based on the financial statements led out by the company. The materiality in audit
comprises of the following (Unibail-Rodamco-Westfield, 2019):
Quantitative aspects:
While dealing with the quantitative aspect, the following five steps were followed:
1- In the planning stage of the audit, when looking after the audit reports of the year
2017-2018, there were certain numbers which were to be pulled into considerations.
There were reports led out by the organization itself, which gives a wider aspect of
the numbers. Following the general rule of the thumb, which includes either the 5 to
10% of normalized net worth or a portion of the total assets of the organization
2- The accounts receivable and inventory details were considered while making the
audit report
3- The estimated misstatement in an account
4- The total aggregate misstatements estimated
5- Finally compare the numbers drafted in the reports of the organization gained while
planning and the total aggregate misstatements aggregated in the end.
Qualitative Aspects:
Despite the auditing taking place, there are times the organization does not provide the
complete report or material, which adequately discloses the contingent liabilities and the
party related transactions. Here, there was, however, a complete numeric generated report
with each and every liabilities well-maintained. This made the audit procedure much easier.
There are certain times when the company chooses to use 20 years in order to amortize the
asset, while when in actual disclosures it is stated to be 2 or maybe max 2, yet these are
considered to be an auditory material. Keeping in mind the minute errors in the financial

statements could also lead to some severe violations and a complete failed audit report,
however, the things were kept in mind to consider it into audit material (Unibail-Rodamco-
Westfield, 2019).
Considering both the qualitative and quantitative aspect of the company the following report
was represented. As per the numbers provided to us by the company website, gives an overall
positive view for the company. The year 2018, seems to be a pretty great year with respect to
numbers for the Unibail-Rodamco-Westfield. They are the premier global developer as well
as the operator of the flagship shopping centres in Europe. With the mergers and acquisitions
that took place in the year 2018, the year seems to have yielded pretty great results for the
company on the whole (Unibail-Rodamco-Westfield, 2019).
Section 2: The Complete report
The Unibail-Rodamco-Westfield financial statements consolidated as per on the 31st
December 2018. These were prepared in proportionate format, which includes the
representations through bar charts, graphs and explanation through numeric, in proportionate
basis instead of using any other method such as the equity method.
(Unibail-Rodamco-Westfield, 2019)

The black cart indicates the year 2017 with a mark of €12.05 million and that increases to a
€12.92 million mark in the year 2019. The similar growth path is seen in the EPRA net asset
value of the group and the EPRA per share value in the financial year 2018-2019.
This audit report, hopefully, gives a better understanding to both the stakeholders, explaining
the underlying operations and statistics of Unibail-Rodamco-Westfield in a much better way.
Also, these include the joint-controlled entities as well since the organization represent a
significant part in the US and UK as well (ASX, 2019).
This report is represented in a much proportionate format structured both of its internal
operations and financial reporting. It has been taken into consideration that the net results
with regards to the company must not be hindered at all. A firm balance is maintained
between the results and the statistics.
The adjusted recurring earnings (ARE) is calculated on basis of the repeated net results.
These are for the period referred to the holders of the stapled shares excluding the coupon on
the Hybrid Securities, in the year 2018.

The above table showcases the full year of 2017 restated at a proportionate basis, along with
the group account activity from 1st June 2018 (Unibail-Rodamco-Westfield, 2019).
Shareholding Structure
While auditing on the Unibail-Rodamco-Westfield reports and stats it was equally important
to go through the shareholding structure which would impact the financial report 2018 of the
organization. The stapled shares of the Unibail-Rodamco-Westfield are listed on the
Amsterdam Stock Exchange and the Paris Stock Exchange, along with the form of Chess
Depositary Interests, CDI on the Australian Securities Exchange.
Unibail-Rodamco-Westfield has been added in the CAC 40, AEX 25, Euro Stoxx 50 and
ASX 100 indices. It was on December 31, 2018, the Group had a record market capitalization
of €19 billion. The group Unibail-Rodamco-Westfield has a huge and diverse international

stakeholder base. This international foreign base is most importantly comprised of the
institutional/educational investors those were based in countries like the United States and the
United Kingdom, the Netherlands, France, and also in Australia after the mergers. The
numbers state that there was no shareholder of the group that had declared any shareholdings
of more than 10% of the share capital issued at the beginning of the group. The main and the
most essential known shareholders of the organization Unibail-Rodamco-Westfield were with
holdings, which ranged from 3% to 10%, which includes BlackRock IM, APG Asset
Management, Vanguard Group, along with them, it included those which were below 3% that
is LFG America (Unibail-Rodamco-Westfield, 2019).
Share Price Performance
The below graph represents the relative performance of the Unibail-Rodamco-Westfield's
share. The numerals are rebased to 100 as on 25th June 2007.
(Unibail-Rodamco-Westfield, 2019)
Total Shareholder Return (TSR) was used to measure shareholder value creation. The total
Shareholder Return represents the total return that is obtained with respect to the shareholder
having the ownership of his part of shares at a given point of time.

The share price performance of the company also indicates that the dividends or any other
distribution are either paid or re-invested in the company’s shares. These graphs clearly also
include the changes that the organization has gone through with respect to the share price
from time to time. Indicate the bulls and bear points of the same (Unibail-Rodamco-
Westfield, 2019).
The graph suggests about the shares amounted to a percentage of 2.50% per annum, as per
the Total Shareholder return was between the June 2007 and December 2018, which was
compared with 1.43% for the CAC 40 index and 1.31% for the EPRA (9) Eurozone Total
Return Index. It is merely based on the share price of Unibail-Rodamco SE until the time of
June 2018. Following this date, the share price is based on the stapled share of Unibail-
Rodamco-Westfield, consisting of each share of both the companies Unibail-Rodamco SE
and that of WFD Unibail-Rodamco N.V. (Unibail-Rodamco-Westfield, 2019)
Section 3: Traded Volumes
In the year 2018, there have been certain changes seen, which in a way forecasts the future,
rather the coming financial year 2019-2020 statistics. Considering the complete report of the
liabilities and shareholders, the share prices and others there year has been out and out a
successful one for the organization. The numbers represented in the report clearly states the
same thing. In the year 2018 the average count of the daily volume of shares traded was
435,863, which compared to the 306,122 in 2017 was higher stake. Whereas, speaking of the
value of the number of average daily traded shares, it was €79 million in 2018, which in
comparison to €66.8 million in 2017 was higher. This is a complete profitable situation where
there is a commendable growth of approximately 30,000 shares and a mass growth of 10
million from the year 2017 to 2018 (Unibail-Rodamco-Westfield, 2019).

Traded volume rolling over 12 months and closing share price monthly average since 2009
(in euros):
(Unibail-Rodamco-Westfield, 2019)
Now the above graph represents the fiscal year 2018. However, there was marginal growth in
the share prices in the year 2015, because of the market time and the mergers and acquisitions
taking place, however, there has been a consistent period as well. Rolling out in the year
2019, there has been a major roll-out experienced by the company until the year 2018-2019.
Some figures and notes to be noted for the year 2019
The dividend payment schedule of the organization is expected to be as follows:
It is expected that an interim dividend of €5.40 per stapled share will be active by March
2019, which is to be paid by Unibail-Rodamco SE. A final dividend of €5.40 per stapled
share, subject to the approval of the AGMs, will be on July 2019. The split of the final
dividend will be described later in the convening notices for the AGMs.
The total amount of dividends paid with respect to 2018 is state to be €1,493.5 million for the
138,288,601 stapled shares. This rounds up to an outstanding as of December 2018. This
represents a 94% pay-out ratio of the adjusted net recurring result of the Group. This is

composed of the net recurring result of Unibail-Rodamco through May 2018 and Unibail-
Rodamco-Westfield from June 2018 (Unibail-Rodamco-Westfield, 2019).
References
ASX. (2019). Prices and research. Retrieved from Asx.com.au:
https://www.asx.com.au/asx/share-price-research/company/UCW/details
Thomas, B. (2019, February 28). Around The Globe: Unibail-Rodamco-Westfield. Retrieved
from Forbes.com: https://www.forbes.com/sites/bradthomas/
Unibail-Rodamco-Westfield. (2019). All documents. Retrieved from Urw.com:
https://www.urw.com/all-documents
Unibail-Rodamco-Westfield. (2019). Creating value and delivering. Retrieved from
Report.urw.com: https://report.urw.com/2018/figure-it-out.html
Unibail-Rodamco-Westfield. (2019). Financial information. Retrieved from Urw.com:
https://www.urw.com/en/investors/financial-information
Unibail-Rodamco-Westfield. (2019). Financial results. Retrieved from Urw.com:
https://www.urw.com/en/investors/financial-information/financial-results
Unibail-Rodamco-Westfield. (2019). Investors. Retrieved from Urw.com:
https://www.urw.com/en/investors
Unibail-Rodamco-Westfield. (2019). The premier global developer and operator of flagship
shopping destinations. Retrieved from Urw.com: https://www.urw.com/
Unibail-Rodamco-Westfield. (2019). The premier global developer and operator of flagship
shopping destinations. Retrieved from Unibail-rodamco-westfield.de:
https://www.unibail-rodamco-westfield.de/en/
Unibail-Rodamco-Westfield. (2019). Unibail-Rodamco S.A. Retrieved from
Annualreports.com: http://www.annualreports.com/Company/unibail-rodamco-sa