ARGAN Achieves 10% Growth in Rental Income for Q1 2025
Quarterly financial information – Neuilly-sur-Seine, April 1, 2025
Quarterly Summary
In the first quarter of 2025, ARGAN, a prominent French real estate firm known for developing and leasing premium warehouses, reported a commendable rental income of €52.9 million, reflecting a significant 10% increase compared to the same period last year. This positive trend can be attributed to several key factors, including the full-year effects of eight warehouse deliveries completed in 2024 and a 3.45% rent indexation that took effect on January 1, 2025.
Maintaining Positive Growth Trajectory
Thanks to the successful outcomes in the first quarter, ARGAN is optimistic about the year ahead. The company remains committed to its annual target of achieving a 6% increase in rental income for 2025, aiming for a total income of €210 million. This projection takes into consideration the potential impact of asset sales expected in the latter half of the year.
Recent Project Completions
During the first quarter, ARGAN executed two notable deliveries as part of its ongoing development strategy. One significant project involved a logistics facility for DIMOLOG, a new brand under the DIMOTRANS group, located in a strategic area close to Rennes. This facility encompasses three newly built warehouse sections, extending across 19,500 square meters and is recognized as an Aut0nom®-branded asset.
In a more community-focused initiative, ARGAN has continued its support for a former employee's agricultural venture, “Les tomates des frères Besnard”. This commitment led to the development of an organic greenhouse in the Eure-et-Loire region, aiming to promote eco-responsibility in local agriculture.
Increased Investment Plans for 2025-2026
Looking ahead, ARGAN has unveiled plans to elevate its identified investments for 2025 and 2026 to €220 million, marking a nearly 30% increase over previous targets. These investments are backed by eleven development projects, all pre-committed to reputable, blue-chip clients. The breakdown of investment allocations includes:
- 2025: Approximately €105 million allocated to four new projects and one acquisition.
- 2026: Approximately €115 million aimed at two new self-development projects, two extensions, and two additional acquisitions.
With this aggressive growth strategy, ARGAN expects an average yield on investments of 6% for the upcoming years. This includes a projected 7% yield for self-developments and a 5% yield on acquisitions. As the company navigates a challenging economic landscape, it remains steadfast in its commitment to sustainability and innovation in its offerings, particularly with its Aut0nom® net carbon-neutral warehouses.
Financial Health and Stability
Emphasizing its focus on sustainable growth and debt reduction, ARGAN is working towards a loan-to-value (LTV) ratio of below 40% and aims to achieve a net debt to EBITDA ratio of around 8X by the end of this fiscal year. The company plans to finance its future projects largely through operational cash flow and selective asset disposals, targeting approximately €180 million for this endeavor.
2025 Financial Calendar
- July 1: Release of net sales for Q2 2025
- July 17: Announcement of half-year results for 2025
- October 1: Release of net sales for Q3 2025
About ARGAN
ARGAN prides itself on being the only French real estate enterprise exclusively focused on the development and rental of premium warehouses. Listed on EURONEXT, it leads the market in France, leveraging a customer-oriented approach to deliver tailor-made services at every phase of warehouse development and management. As of December 31, 2024, the company boasted a portfolio of 3.7 million square meters comprising approximately one hundred premium warehouses across mainland France, valued at around €3.9 billion.
With an annual rental income nearing €205 million, ARGAN demonstrates a solid commitment to profitability, sustainability, and effective debt management. The firm possesses an investment-grade rating from Standard & Poor’s, reflecting its financial stability and reliable growth prospects.
Frequently Asked Questions
1. What did ARGAN report for its rental income in Q1 2025?
ARGAN reported a rental income of €52.9 million for the first quarter of 2025, marking a 10% increase from Q1 2024.
2. What factors contributed to the increase in rental income?
The increase was driven by the annual impact of eight warehouse deliveries from 2024 and a rent indexation of 3.45% effective January 1, 2025.
3. What are ARGAN's investment plans for 2025 and 2026?
ARGAN plans to increase identified investments to €220 million, focusing on several projects aimed at continuing growth.
4. How does ARGAN plan to finance its upcoming projects?
The company will finance its developments through operational cash flow and a strategy of selective asset disposals.
5. What is the company’s commitment to sustainability?
ARGAN emphasizes sustainability through the development of carbon-neutral warehouses and a committed ESG policy focused on environmental responsibility.
