Group 1 - The investment strategy focuses on long-only investment, evaluating companies from an operational and buy-and-hold perspective, rather than market-driven dynamics [1] - The articles emphasize understanding the long-term earnings power of companies and the competitive dynamics within their industries [1] - The majority of recommendations will be holds, indicating a cautious approach to investment opportunities [1] Group 2 - A very small fraction of companies are considered a buy at any given time, highlighting a selective investment strategy [1] - Hold articles are intended to provide valuable information for future investors and introduce skepticism in a generally bullish market [1]

Financial Data and Key Metrics Changes - The company reported a net loss of 41 billion Pesos primarily due to non-cash effects from the appraisal of investment properties [3][66] - The adjusted EBITDA for the hotel segment dropped from 15 billion Pesos to 5 billion Pesos, with hotel margins decreasing from 38% to 17% [38][96] - The net financial results showed a significant improvement with a net FX result of a 205 billion Pesos loss last year compared to a gain of 21 billion Pesos this year due to Peso appreciation [100][101] Business Line Data and Key Metrics Changes - Shopping malls experienced a 21.4% increase in tenant sales in Q2 2025 compared to the previous quarter, although still 8.5% below the same quarter last year [11][69] - The office segment achieved full occupancy in its premium portfolio, with stable rents at approximately $25 per square meter per month [14][72] - The hotel segment faced challenges with occupancy rates declining from 70% to 67% compared to the previous year [16][74] Market Data and Key Metrics Changes - The company completed the acquisition of the Terrazas De Mayo shopping mall, adding approximately 34,000 square meters of GLA to its portfolio [12][19] - The overall occupancy rate for the shopping malls remained high at nearly 98%, excluding the newly acquired mall which is currently at 82.3% [12][71] - The company noted a positive outlook for the shopping mall segment in the upcoming quarters, aligning with economic recovery in Argentina [11][61] Company Strategy and Development Direction - The company is focusing on residential developments, with a significant project, Ramblas Del Plata, expected to yield over 10,000 new homes and an estimated investment of $1.8 billion [20][90] - The strategy includes selling plots to cover infrastructure costs and swapping remaining plots with local developers, minimizing cash investment from the company [54][113] - The company anticipates positive developments in the shopping mall segment and the commencement of several construction projects in the next quarters [61][120] Management's Comments on Operating Environment and Future Outlook - Management highlighted the recovery in consumer spending following the Milei administration, expecting improved performance in the shopping mall segment [61][120] - The company is optimistic about the valuation of its mall portfolio increasing due to decreasing country risk and improving operational figures [40][99] - Management expressed confidence in managing debt maturities, citing a strong cash position and liquidity [58][118] Other Important Information - The company paid dividends yielding 8% during the last quarter, maintaining a conservative net debt level of $255 million [44][103] - The company is actively pursuing infrastructure projects, with significant investments planned for the Ramblas Del Plata project [81][82] Q&A Session Summary Question: Can you provide details on the price per square meter for the Ramblas Del Plata project? - The expected price per square meter will start at no less than $4,000, potentially reaching up to $6,000 for taller buildings depending on market conditions [49][109] Question: How does the company plan to finance the upcoming investments? - The company plans to finance projects through cash generation and selling plots to cover infrastructure costs, minimizing cash outflow [54][115] Question: How will the company manage debt maturities in 2025? - The company has sufficient liquidity to manage debt maturities and will evaluate whether to go to the market or raise debt through banking channels [58][118]

Financial Performance - The company reported a net loss of ARS 40,971 million for the first half of 2025, primarily due to the impact of inflation on the fair value of investment properties[3] - Rental EBITDA decreased by 9.5% from 6M 24 to 6M 25[56] - The company's net financial result improved by ARS 227,303 million, primarily due to net FX results[62] Operational Highlights - Shopping malls experienced a recovery in occupancy and sales, with a 21.4% increase compared to the previous quarter (IQ 25), but an 8.5% decrease compared to IIQ 24[3] - Premium office occupancy reached 100%[3] - The company acquired "Terrazas de Mayo" shopping mall located in Malvinas Argentinas District[3, 6] - Hotels' revenues and occupancy dropped during IIQ25[3] Ramblas del Plata Project - Two plots from the first stage of the Ramblas del Plata project (40,000 sellable sqm) were sold for USD 23.4 million[3] - The Ramblas del Plata project has an estimated investment of over USD 1.8 billion[21] - Stage 1 of Ramblas del Plata is estimated to have total sales (cash + swaps) of USD 120 million[27] Dividend and Share Distribution - The company distributed a dividend with an approximate 8% yield and holds 25.7 million treasury shares, representing 3.6% of the social capital[3] Other Projects - IRSA will receive 40% of the buildable sqm of the macro lots from "Nuevo Quilmes II" Commercialization Progress[41] - 33 single-family lots already sold for approximately USD 5 million[41]

Core Viewpoint - IRSA Inversiones y Representaciones S.A. reported significant financial losses for the second quarter of Fiscal Year 2025, primarily due to a substantial loss in the fair value of investment properties, despite some recovery in tenant sales in shopping malls [1][4]. Financial Highlights - Revenues for the first half of FY 2025 were ARS 212,141 million, a decrease of 4.0% from ARS 220,936 million in the same period of FY 2024 [3]. - Consolidated Gross Profit fell to ARS 130,934 million, down 12.5% from ARS 149,605 million year-over-year [3]. - The net result from changes in the fair value of investment properties was a loss of ARS 233,073 million, compared to a gain of ARS 300,126 million in the previous year [3][4]. - The consolidated result from operations showed a loss of ARS 149,784 million, contrasting with a profit of ARS 420,889 million in the same period last year [3]. - The net result for the period was a loss of ARS 40,971 million, compared to a profit of ARS 319,226 million in the prior year [3][4]. - Earnings per Share (EPS) were reported at (54.19), a significant decline from 412.55 in the same period of FY 2024 [3]. Operational Highlights - Real tenant sales in shopping malls increased by 21.4% compared to the previous quarter but decreased by 8.5% compared to the same period of FY 2024 [4]. - The adjusted EBITDA for the shopping mall segment was ARS 94,539 million, only 2.0% lower than the same period last year [4]. - The company acquired a new shopping mall, "Terrazas de Mayo," for USD 27.75 million, with a leasable area of 33,700 sqm and 86 stores [4]. - The premium office portfolio achieved 100% occupancy, and an additional floor of the Della Paolera 261 building was sold for USD 7.1 million [4]. - The Hotels segment experienced lower revenues and occupancy rates compared to FY 2024, attributed to the appreciation of the Argentine peso against the U.S. dollar [4]. - Sale agreements were signed for two lots of the Ramblas del Plata project, with an estimated saleable area of 40,000 sqm for USD 23.4 million [4]. Market Capitalization - As of December 31, 2024, the company's market capitalization was approximately USD 1,117 million, based on 74,829,790 GDS with a price per GDS of USD 14.93 [5].

Group 1 - The investing group High Yield Landlord offers a free trial for potential investors to access their portfolio and top picks without any initial cost [1][2] - Jussi Askola, the leader of High Yield Landlord, is also the President of Leonberg Capital, which specializes in consulting on REIT investing for hedge funds and private equity firms [2] - The group provides features such as three distinct portfolios (core, retirement, international), buy/sell alerts, and a chat room for direct interaction with analysts [2] Group 2 - Jussi Askola has a strong background in REIT investing, having authored award-winning academic papers and passed all three CFA exams [2] - The group emphasizes real-time sharing of transactions and portfolio management, enhancing transparency for its members [2]

Financial Data and Key Metrics Changes - The company reported an adjusted EBITDA of ARS 46.9 billion, which is 8.8% lower than the previous quarter in 2024 [3] - A net loss of ARS 109 billion was posted, primarily due to a non-cash effect related to the valuation of investment properties [4][28] - The adjusted EBITDA is 10% lower than the same period last year, with a significant loss of almost ARS 225 billion in fair value adjustments [30][31] Business Line Data and Key Metrics Changes - The Shopping Mall segment remained stable, with tenant sales showing a slight recovery of 7% compared to the previous quarter but still 12% below last year's figures [4][7] - Office occupancy reached 98%, while shopping malls reported an occupancy rate of 97% [5][10] - The Hotel segment faced challenges, with occupancy dropping from 66% to 55% and a 60% decrease in EBITDA due to lower rates and occupancy [12][30] Market Data and Key Metrics Changes - The company experienced a 20% appreciation of the peso in terms of the dollar MEP, impacting the valuation of investment properties [27][28] - The real estate market is showing signs of recovery, with increased interest from developers and a shift towards a more favorable environment for residential purchases [19][49] Company Strategy and Development Direction - The company is focusing on active management of its portfolio, with no specific target for office space recovery but will consider opportunities for acquisition or development [42][43] - New projects are being launched, such as Ramblas Del Plata, which has garnered strong interest from developers [15][49] - The company aims to be more aggressive in development, leveraging its conservative financial structure to capitalize on market opportunities [49] Management's Comments on Operating Environment and Future Outlook - Management noted a new trend in consumption and positive developments in the real estate sector due to tax amnesty and the revival of the mortgage industry [49] - There is an expectation of improved tenant sales in the upcoming quarters, particularly as comparisons shift to the new administration's economic environment [41] Other Important Information - The company announced and paid dividends amounting to ARS 90 billion, representing an 8% dividend yield [6][37] - A new debt issuance was completed, with a conservative net debt to rental EBITDA ratio of 1.8x [36] Q&A Session Summary Question: Expectations for tenant sales recovery and office portfolio expansion - Management anticipates a recovery in tenant sales compared to the previous quarter, but weaker numbers may be seen in December due to comparisons with the previous administration [40][41] - There are no specific plans to rebuild or expand the office portfolio; the focus will be on managing opportunities as they arise [42][43] Question: Progress on Ramblas Del Plata - Strong interest from developers has been noted, with plans to start signing agreements soon; environmental approval is expected shortly [44][45] Question: Environmental processing updates - The environmental approval process is ongoing, with no significant issues anticipated [46][47]

Core Insights - The company reported a net loss of ARS 109,135 million for the first quarter of fiscal year 2025, a significant decline from a profit of ARS 250,538 million in the same period last year, primarily due to losses from changes in the fair value of investment properties [2][3]. Financial Performance - Revenues decreased to ARS 89,873 million from ARS 94,939 million year-over-year [3]. - Consolidated gross profit fell to ARS 57,415 million compared to ARS 64,045 million in the previous year [3]. - The net result from changes in the fair value of investment properties was a loss of ARS 225,499 million, contrasting with a gain of ARS 316,084 million in the same quarter of the previous year [3]. - The consolidated profit/loss from operations was a loss of ARS 187,584 million, down from a profit of ARS 375,142 million [3]. - Earnings per share (EPS) were reported at ARS -145.92, compared to ARS 323.89 in the same quarter last year [3]. Segment Performance - Real tenant sales in shopping centers showed a slight recovery but were down 12.1% compared to the first quarter of fiscal year 2024 [2]. - The adjusted EBITDA for the shopping center segment was ARS 41,116 million, consistent with the same quarter of the previous year [2]. - The average occupancy rate of the premium office portfolio increased to 97.9%, mainly due to improved occupancy at Dot Building [2]. - The hotels segment experienced reduced income and occupancy levels due to lower exchange competitiveness in Argentina [2]. Strategic Developments - The company acquired a property adjacent to the Alto Avellaneda shopping center for future expansion at a cost of USD 12.2 million and sold an additional floor of the Della Paolera 261 building for USD 7.1 million [2]. - A cash dividend of ARS 90,000 million was approved by the shareholders' meeting, representing a dividend yield of 8% and approximately 3.6% of the stock capital [2]. Balance Sheet Overview - As of September 30, 2024, total assets were ARS 2,286,495 million, down from ARS 2,513,712 million [3]. - Current assets increased slightly to ARS 257,290 million from ARS 255,350 million [3]. - Total liabilities decreased to ARS 1,120,978 million from ARS 1,221,471 million [3]. - Shareholders' equity was reported at ARS 1,165,517 million, down from ARS 1,292,241 million [3]. - The company's market capitalization was approximately USD 850 million as of September 30, 2024 [3].

Company Overview - IRSA Inversiones y Representaciones S.A. is the leading real estate company in Argentina, listed on both BYMA and the New York Stock Exchange [1] - The company manages a diverse portfolio that includes shopping centers, office buildings, and three luxury hotels, primarily located in Buenos Aires [1] - IRSA also holds a stake in Banco Hipotecario, which is Argentina's largest mortgage supplier [1] Financial Reporting - The company has filed its 20-F Form for Fiscal Year 2024, which ended on June 30, 2024, with the SEC [1] - The complete audited financial statements are available on the company's website and can be requested in hard copy free of charge [1]

Economic Overview - As of June 30, 2024, Argentine GDP decreased by 1.7% year-over-year, an improvement from a 4.9% decrease in the same period of 2023[263] - The inflation rate for the fiscal year ending June 30, 2024, was 271.5%, significantly higher than 115.6% in 2023[264] - The average exchange rate as of June 30, 2024, was ARS 910.50 per USD, compared to ARS 256.50 per USD in 2023, reflecting a depreciation of 255.0%[264] - The unemployment rate as of June 30, 2024, was 7.6%, up from 6.2% in the same period of 2023[263] Sales and Revenue Performance - National shopping mall sales in June 2024 reached ARS 463,761 million, representing a 165.3% increase compared to June 2023[263] - Accumulated sales for the first half of 2024 increased by 220.5% in current terms and 0.7% in real terms compared to the same period in 2023[263] - Total revenues for the fiscal year ended June 30, 2024, reached ARS 270,550 million, a significant increase compared to previous years[277] - Revenues from shopping malls increased to ARS 179,650 million, up ARS 3,404 million from ARS 176,246 million[284] - Revenues from the Offices segment decreased by 4.6% from ARS 17,031 million in FY 2023 to ARS 16,243 million in FY 2024, primarily due to a reduction in lease revenue[287] - Revenues from the Sales and Developments segment decreased by 43.2% from ARS 16,280 million in FY 2023 to ARS 9,246 million in FY 2024, influenced by non-recurrent sales transactions[287] - Revenues from the Hotels segment increased by 10.7% from ARS 55,596 million in FY 2023 to ARS 61,569 million in FY 2024, attributed to improved rates and occupancy levels[287] Profit and Loss Analysis - Gross profit for the same period was ARS 221,784 million, reflecting a strong operational performance despite challenges[277] - The net loss from fair value adjustments of investment properties amounted to ARS 350,955 million, indicating significant valuation impacts[277] - The company reported a segment loss of ARS 169,273 million, highlighting operational challenges in certain segments[277] - The overall profit for the year shifted from a profit of ARS 226,586 million in FY 2023 to a loss of ARS 33,803 million in FY 2024, reflecting the impact of various financial factors[119] Cost Management - General and administrative expenses totaled ARS 51,179 million, showing a focus on cost management[277] - Selling expenses were recorded at ARS 17,491 million, reflecting the company's investment in marketing and sales efforts[277] - Costs associated with shopping malls decreased by ARS 1,223 million to ARS (10,714) million, compared to ARS (11,937) million previously[284] - General and administrative expenses for the Shopping Malls segment decreased by 13.0% from ARS 24,826 million in FY 2023 to ARS 21,608 million in FY 2024, with expenses as a percentage of revenues falling from 14.1% to 12.0%[293] Investment and Asset Management - The company’s investment properties are revalued quarterly, which may lead to significant fluctuations in operational results based on market conditions[267] - Reportable assets as of June 30, 2024, were ARS 1,945,139 million, demonstrating the company's asset base[277] - The total outstanding debt as of June 30, 2024, was ARS 366,754 million, with scheduled maturities including ARS 181,405 million due within one year[328] Corporate Governance - The board of directors consists of twelve regular directors and three alternate directors, with terms expiring in 2024 and 2025[342] - Directors are elected for three-fiscal year terms by a majority vote of shareholders at a general ordinary shareholders' meeting[342] - The company is managed by a board of directors, which is responsible for all management decisions and execution of shareholder resolutions[342] Future Outlook - Future outlook includes continued focus on market expansion and new product development to drive revenue growth[302] - The company provided an optimistic outlook, projecting a revenue growth of 20% for the next fiscal year, targeting $1.44 billion[345] - Market expansion plans include entering three new countries by Q2 2024, which is anticipated to increase market share by 10%[345] Legal and Regulatory Matters - The Argentine Government is seeking to extend Indarsa's bankruptcy to Puerto Retiro, which could impact the company's financial standing[371] - The company is awaiting a final judgment in the bankruptcy extension lawsuit, with no assurance of a favorable outcome[371] - The Central Bank dismissed charges against IRSA and its directors on June 25, 2024, related to a sale transaction of securities settled in foreign currency[374] Shareholder Information - Major shareholders include CRESUD with 397,831,498 shares, representing 53.7% ownership, and ANSES with 40,542,680 shares, representing 5.5% ownership[357] - The total number of outstanding shares as of June 30, 2024, was 741,459,162, with 23,401,746 shares held in treasury[358] - The company paid cash dividends totaling ARS 21,900 million or ARS 27.31 per share on May 5, 2023, and ARS 64,000 million or ARS 88.47 per share on October 12, 2023[383] Taxation and Compliance - The corporate tax rate in Argentina was reduced from 35% to 30% for fiscal years from January 1, 2018, to December 31, 2019, and further reduced to 25% starting January 1, 2020[435] - Dividends distributed from profits accrued in fiscal years starting January 1, 2021, are subject to a withholding tax of 13%[436] - Argentina has signed tax treaties with multiple countries to avoid double taxation, but none with the United States[443]

| --- | --- | --- | --- | --- | --- | --- | |---------------------------|-------|------------|-----------------------------------------------------------------------------|-------|-------|-------| | | | | | | | | | | | | | | | | | | | | | | | | | FY 2024 Conference Call | | | | | | | | | | | | | | | | September 4, 2024 | | | | | | | | | | Hosted by: | | | | | | | | | Matias Gaivironsky, CFO Jorge Cruces, CIO Santiago Donato, Head of IR & ESG | | | | Main Events for FY 24 and | --- | --- | --- | --- | --- | ...