- The company is enhancing integration between the physical and digital worlds, generating high value synergies and personalized experiences for its visitors.
12 May 2020 – Mallplaza’s main focus of action in the context of the Covid-19 pandemic in Chile, Peru and Colombia has been to safeguard the health of visitors, store workers and its associates. The company reported in its latest financial statement release that it has kept its shopping centers operating since 19 March with an average of 25% of the leasable area in the region open, destined to the supply of essential products and services like supermarkets, health centers, services, home improvement stores, and food businesses, through delivery.
Thus, for example, 70% of its shopping centers – specifically in Chile and Colombia – have their gastronomy tenants operating in the delivery modality.
“We are currently implementing a gradual, safe, coordinated and sustainable opening, with reduced opening hours and in coordination with the authorities and tenants. How hope to provide a safe visiting experience to our visitors and associates,” explains Pablo Cortés, Corporate Manager of Administration and Finance.
Regarding future openings, he said that the conditions for opening new services and businesses are evaluated on a daily basis. “We are working with the authorities and coordinating with our tenants regarding the conditions required for them to open their stores, to the extent that they can guarantee all the prevention measures that we request as a shopping center.”
Omnichannel transformation
Mallplaza also reported that it is enhancing integration between the physical and digital worlds, generating high value synergies and personalized experiences for its visitors.
“We understand our shopping centers as omnichannel ecosystems, where multiple interactions occur that we are continually enhancing to offer a better visiting and shopping experience to our customers and creating opportunities for our tenants,” said the executive.
Thus, for example, in Digital Marketing Mallplaza can communicate with its customers during their visit, activating triggers with segmented communication in real time. In addition, it raises the visibility and strengthens the sales conversion channels for its tenants through the Mallplaza website, as the brands’ portal.
“We have integrated and actively participate in a Digital Ecosystem and continue to digitize the company’s Core Business, allowing us to gain a better understanding of our customers, getting to know them better and providing a customized response their requirements and needs, opening opportunities for our tenants,” Pablo Cortés says.
In addition, the company has a portfolio of regional shopping center assets that is unique in Latin America, including 5 of Chile’s top 10 shopping centers in terms of leasable area and sales.
Economic Performance
Regarding the short-term effects on its economic performance, Mallplaza reported that its revenues were down 3% and its EBITDA fell by 7% in the last 12 months.
In terms of visitor flows, there were 275 million visits in the region over the last 12 months, an average drop of 5% compared to the year before, associated with lockdown periods in Chile last October and in March 2020 due to the pandemic in the region. Meanwhile, revenues in 1Q2020 were down 4%. Without the effect of the lower rental income due to the pandemic in March, revenues would have grown 5% compared to the same quarter the previous year.
The current Coronavirus contingency finds Plaza S.A. in an adequate financial and liquidity position for its 2020 disbursement commitments, including in a projected stress scenario. Its financial debt maturities correspond to long-term debt (79%) and the duration of its total debt is 6 years.
Regarding the reduction of operational costs, Mallplaza reported savings associated with the partial closure of its shopping centers and agreements with suppliers (non-SMEs), which have allowed operating expenses to be reduced by between 20% and 25% of the operating expenses for May. This is added to the 25% reduction in the board’s expenses, agreed at the Regular Shareholders’ Meeting of Shareholders last April and a 35%-40% reduction in executives’ annual remuneration. Regarding the dividend on 2019 profits, the company reported that it had been reduced to the legal minimum of 30%.
Regarding support for its tenants, the company has privileged long-term relationships, suspending payment of rent and the promotion fund for its tenants that are unable to open to the public.
