JSE-listed Polish property company EPP has declared a distribution growth of 12% apiece to 5.82c for the six months ended June 30, compared with 5.19c in the first half of 2017, placing the company on track to deliver full year dividends of between 11.6 and 11.8c apiece.

EPP’s results show distributable earnings increased by 32% to €48.3-million and that net property income growth increased by 45% to €66.2-million.

Earnings before interest, taxation, depreciation and amortisation were €59.2-million for the period, compared with €41.8-million in the prior comparable period, which amounts to a 42% growth rate.

The company’s successful acquisition of the first tranche of its three-phase M1 portfolio deal added 194 000 m² to its retail property portfolio, increasing total income-producing assets to more than €2-billion, with gross lettable area (GLA) now at 638 815 m².

The company is targeting a million square meter GLA by 2020.

For the reporting period, net asset value per share increased 4% to €1.37.

EPP CEO Hadley Dean commented the retail sector in Poland continued to be fuelled by a growing middle class, and the company’s vacancy rates remained below 1%.

“The strong macroeconomic conditions in Poland, with increasing employment, wage growth and consumer spending have exciting potential for consumption and retail sales growth.

“Poland is experiencing gross domestic product growth well above the European Union average, and Poland will continue to be the key spot in Europe for growth in retail during the next few years.”

With its M1 acquisition pipeline, EPP is set to own 28 shopping centres, spanning more than a million square metres, all within a 30-minute drive of 40% of Poland’s wealthiest regions by 2020.

After the reporting period, EPP also acquired the King Cross Marcelin shopping centre of 45 300 m² in affluent western Poznan.

Construction of Galeria Młociny, EPP’s flagship Warsaw development, is on track and on schedule to open in spring 2019 with pre-letting currently at 87%.