Ahead of Cibus' Q4 2023 report, we leave our operational estimates largely unchanged, while we raise those for 2024-25 income from property management (IFPM) by 7-9%, to reflect lower interest rates and our refinancing assumptions. We include the recent EUR 50m bond issue, which was made at three-month Euribor plus 400bp. We do not think Cibus will carry out any meaningful acquisitions, although it has the capacity to return to M&A mode. Instead, we believe Cibus will prefer to buy back its bonds with maturities in 2024 and 2025. As yields in the grocery-anchored real estate segment have been stable in recent years, we see limited risk of significant yield expansion and asset value declines. Hence, we believe Cibus is not in a hurry to change its LTV target of 55-65%, but instead will try to remain close to the low end of the range. We see no imminent need for new equity. Larger acquisitions would need an equity component, and with shares trading at an EPRA NRV discount of over 20%, we find it unlikely that equity would be used to finance acquisitions currently. Marketing material commissioned by Cibus.
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