DGAP-News: IMMOFINANZ Group with increase in net profit - Five-year sales
programme completed earlier than planned
DGAP-News: IMMOFINANZ AG / Key word(s): Real Estate/Quarter Results
IMMOFINANZ Group with increase in net profit - Five-year sales
programme completed earlier than planned
19.03.2014 / 18:41
KEY FIGURES (in MEUR) // 1 May 2013 - 31 January 2014 // Δ in % // 1 May
2012 - 31 January 2013
Rental income // 468.3 // -5.0% // 492.9
Results of asset management // 376.8 // -4.1% // 392.9
Results of property sales // 26.0 // -56.4% // 59.6
Results of property development // 11.6 // n.a. // -6.5
Expenses not directly attributable // -70.6 // -12.2% // -80.3
Results of operations // 358.7 // -7.2% // 386.3
Operating profit (EBIT) // 486.0 // 8.4% // 448.4
Net profit for the period // 225.8 // 7.1% // 210.8
Gross cash flow // 281.8 // -10.6% // 315.3
Sustainable cash flow (FFO) // 171.8 // -31.2% // 249.7
IMMOFINANZ Group recorded net profit of EUR 225.8 million in the first
three quarters of 2013/14, for a year-on-year increase of 7.1%. Results of
operations declined slightly due to numerous property sales and the delayed
completion of the GOODZONE shopping center in Moscow.
Rental income was slightly lower year-on-year at EUR 468.3 million for the
reporting period (Q1-3 2012/13: EUR 492.9 million). The results of property
sales amounted to EUR 26.0 million (Q1-3 2012/13: EUR 59.6 million). The
results of property development improved from EUR -6.5 million to EUR 11.6
million. Property sales during the first three quarters of 2013/14 led to a
7.2% decline in the results of operations to EUR 358.7 million (Q1-3
2012/13: EUR 386.3 million). However, the offsetting effects from the
parallel reinvestment of the proceeds will only be realized in the 2014/15
financial year due to the delayed completion of the GOODZONE shopping
center in Moscow.
"We sold properties with a value of EUR 863.1 million during the first
three quarters of 2013/14. With these results, we met the target for the
five-year, EUR 2.5 billion sales programme that was launched in 2010/11 -
as expected - earlier than planned", indicated Eduard Zehetner, CEO of
IMMOFINANZ Group. Property sales from May 2010 to January 2014 totalled EUR
2.52 billion. "In the transaction area, IMMOFINANZ Group wants to maintain
this speed for property sales in the future. We recently sold two office
buildings for nearly EUR 29 million and above the book value: the Airport
Office III in Düsseldorf and the Arbes in Prague. In both cases, the buyers
were institutional investors", added Zehetner.
In addition to sound operating development, positive effects from foreign
currency translation and the valuation of derivatives were also responsible
for the increase in net profit to EUR 225.8 million (Q1-3 2012/13: EUR
210.8 million). Gross cash flow fell from EUR 315.3 million in the
comparable prior year period to EUR 281.8 million. This decline resulted
mainly from an increase in taxes to EUR 28.6 million based on the property
sales (Q1-3 2012/13: EUR 10.3 million) and a temporary increase in input
The market recovery - above all on the stock exchanges - has been
negatively influenced by the Crimean crisis. The extent of a potential
effect on the commercial development of our target markets, above all
Russia, cannot be estimated at the present time. "Although the weak Ruble
has a short-term positive effect on results through the valuation of our
properties, it represents a negative factor for the development of our
business in Russia over the medium- and long-term. The rental income on our
Russian retail portfolio is principally coupled to the Euro or US Dollar,
and a change in the Rubel exchange rate therefore has no direct influence
on our results from asset management. However, as the owner of shopping
centers, we are dependent on the economic success of our tenants. A
continuing decline in the value of the Rubel could lead to pressure on some
of these tenants", commented CEO Eduard Zehetner. In the past, IMMOFINANZ
Group has always handled exchange rate situations successfully and avoided
any material economic damage. For example: IMMOFINANZ concluded special
short-term arrangements with a number of tenants during the 2008/09
financial crisis as a means of reducing foreign exchange effects. That is
also a possible scenario in the current situation.
"We do not believe that the so-called 'sanctions' implemented by various
parties to date are capable of negatively influencing the Russian economy
or the flow of goods and capital", added Zehetner.
"Our Russian properties are financed in US Dollars and solely through
Russian banks (Sberbank of Russia) or the Russian subsidiaries of
international banks (e.g. Rosbank, Nordea). These loans have long remaining
terms, with the respective property serving as collateral. Sufficient
longterm financing is also available for our newly developed properties,
such as the recently completed GOODZONE shopping center", explained CFO
IMMOFINANZ Group expects further growth in the value of the company during
the 2013/14 financial year. This development will be supported by the
further optimisation of the portfolio, the continuation of the extremely
successful sales programme and the intensification of development
activities with a focus on Germany, Poland, Russia and Romania.
After the BUWOG spin-off, IMMOFINANZ will have a sharpened profile as a
specialist for office, retail and logistics properties in Central and
Eastern Europe, including Russia. This will underscore the Group's leading
position in these segments by portfolio volume and market capitalisation.
The BUWOG spin-off will also lead to an improvement in key operating and
financial indicators and significantly reduce the complexity of IMMOFINANZ
Group's structure. The future orientation will also create better
opportunities for strategic transactions. In the operating business,
IMMOFINANZ Group will continue to focus on the real estate machine - and on
the optimisation of profitability along the entire value chain.
DEVELOPMENTS IN DETAIL:
Results of asset management
Rental income amounted to EUR 468.3 million for the first three quarters of
2013/14. This represents a 5.0% decline in comparison with the previous
year (Q1-3 2012/13: EUR 492.9 million) and is attributable to property
sales and delays on development projects during the reporting period.
Results of asset management declined for the same reason, falling by 4.1%
to EUR 376.8 million (Q1-3 2012/13: EUR 392.9 million).
Results of property sales
Property sales generated proceeds of EUR 26.0 million for the reporting
period (Q1-3 2012/13: EUR 59.6 million). The portfolio optimisation
included the sale of smaller properties as well as the sale of the Hilton
Vienna Danube in Austria, the Horn retail warehouse in Austria, the Silesia
City Center in Poland and the Egerkingen logistics property in Switzerland.
The sale of the Silesia City Center for EUR 412 million to an international
consortium of investors headed by Allianz represents one of the largest
transactions on the East European real estate market in recent years. A
major contribution to earnings was also made by the sale of properties in
the BUWOG segment: among others, 48 properties in Upper Austria with 1,135
apartments and nearly 84,000 sqm of total space - representing most of the
portfolio in this province - were sold. After the sale of the Vorarlberg
portfolio and parts of the portfolio in Styria and Carinthia, this
represents a further step by BUWOG in shifting the focus of its business to
the core markets. The greater Vienna area represents the focal point for
Austria, while the northern provinces and the capital city Berlin are the
main focus of activities in Germany.
Results of property development
The sale of inventories and the valuation of active development projects
generated results of EUR -14.8 million, before foreign exchange effects,
during the reporting period (Q1-3 2012/13: EUR -12.1 million). This
negative result is attributable, among others, to delays on the GOODZONE
project. After an adjustment for foreign exchange effects, the results of
property development rose to EUR 11.6 million (Q1-3 2012/13: EUR -6.5
Administrative expenses that are not directly attributable (overhead costs
and personnel expenses) fell from EUR -80.3 million in the first three
quarters of the prior year to EUR -70.6 million. This reduction is
attributable to a year-on-year decline in the negative effects of legal
proceedings by Aviso Zeta.
Results of operations, EBIT, EBT and net profit
Results of operations declined 7.2% year-on-year to EUR 358.7 million (EUR
386.3 million) due to the above-mentioned property sales and delays on
Valuation results, adjusted for foreign exchange effects, were lower than
the comparable prior year period at EUR -30.0 million for the first three
quarters of 2013/14 (Q1-3 2012/13: EUR 25.8 million). This represents a
fluctuation of 0.3% in the value of long-term investment property totalling
EUR 9,218.5 million. EBIT rose by 8.4% from EUR 448.4 million to EUR 486.0
Financial results declined slightly to EUR -204.5 million (Q1-3 2012/13:
EUR -191.7 million). This position includes noncash foreign exchange
accounting effects of EUR -57.6 million (Q1-3 2012/13: EUR -18.5 million).
Other financial results of EUR 27.1 million (Q1-3 2012/13: EUR -14.5
million) contain, among others, positive effects of EUR 27.6 million from
the non-cash valuation of derivatives that are held to hedge interest rate
risk. Earnings before tax rose from EUR 256.7 million in the first three
quarters of the previous year to EUR 281.5 million.
The solid development of the operating business combined with property
sales, positive foreign currency translation effects and the valuation of
derivatives led to a year-on-year increase of 7.1% in net profit from EUR
210.8 million to EUR 225.8 million.
Gross cash flow declined in year-on-year comparison to EUR 281.8 million
(Q1-3 2012/13: EUR 315.3 million). Sustainable cash flow1) amounted to EUR
171.8 million (Q1-3 2012/13: EUR 249.7 million), whereby the reduction is
mainly the result of an increase in tax expense to EUR 28.6 million (Q1-3
2012/13: EUR 10.3 million) and a decline in income from property sales to
EUR 26.0 million (Q1-3 2012/13: EUR 59.6 million). Cash flow from operating
activities declined from EUR 282.2 million to EUR 229.6 million, while cash
flow from investing activities improved to EUR 321.5 million (Q1-3 2012/13:
EUR -38.6 million). Higher repayments of borrowings led to cash flow from
financing activities of EUR -803.0 million (Q1-3 2012/13: EUR -189.6
million). The large number of property sales in recent months and the
accompanying repayment of financing led to an increase in the equity ratio
from 42.3% on 30 April 2013 to 44.3% and a reduction of EUR 270.7 million
in net debt. The loan to value ratio (LTV) equalled 45.8% (net) after the
deduction of cash and cash equivalents.
NAV per share and earnings per share
Diluted net asset value (NAV) per share equalled EUR 5.48 as of 31 January
2014 and declined only slightly by EUR 0.03, or 0.5% per share, below the
level on 30 April 2013 (EUR 5.51) despite the payment of a EUR 0.15
dividend per share at the beginning of October.
Based on the share price as of 18 March 2014 (EUR 3.50), the IMMOFINANZ
share traded at a discount of 36.2% to the diluted NAV per share.
The report on the third quarter of IMMOFINANZ AG as of 31 January 2014 can
be reviewed on the company's website under
on 20 March 2014.
1)Sustainable cash flow: Gross cash flow (EUR 281.8 million [Q1-Q3 2012/13:
EUR 315.3 million]) + interest received on financial investments (EUR 8.6
million [Q1-Q3 2012/13: EUR 14.4 million]) - interest paid (EUR 120.3
million [Q1-Q3 2012/13: EUR 116.1 million]) - cash outflows for derivative
transactions (EUR 24.3 million [Q1-Q3 2012/13: EUR 23.5 million]) + results
of property sales (EUR 26.0 million [Q1-Q3 2012/13: EUR 59.6 million])
On IMMOFINANZ Group
IMMOFINANZ Group is one of the leading listed property companies in Europe.
The company is included in the leading ATX index of the Vienna Stock
Exchange and also trades on the Warsaw Stock Exchange. Since its founding
in 1990, the company has compiled a high-quality property portfolio that
now comprises more than 1,600 investment properties with a carrying amount
of approx. EUR 10.2 billion. As a "real estate machine" the company
concentrates on linking its three core business areas: the development of
sustainable, specially designed prime properties in premium locations, the
professional management of these properties and cycle-optimised sales.
IMMOFINANZ Group concentrates its activities in the retail, office,
logistics and residential segments of eight regional core markets: Austria,
Germany, Czech Republic, Slovakia, Hungary, Romania, Poland and Russia.
Further information under: http://www.immofinanz.com |
http://blog.immofinanz.com | http://properties.immofinanz.com
For additional information please contact:
Head of Corporate Communications | Press Spokesperson
T +43 (0)1 88 090 2290
M +43 (0)699 1685 7290
Head of Corporate Finance & Investor Relations
T +43 (0)1 88 090 2312
M +43 (0)699 1685 7312
End of Corporate News
19.03.2014 Dissemination of a Corporate News, transmitted by DGAP - a
company of EQS Group AG.
The issuer is solely responsible for the content of this announcement.
DGAP's Distribution Services include Regulatory Announcements,
Financial/Corporate News and Press Releases.
Media archive at www.dgap-medientreff.de and www.dgap.de
Company: IMMOFINANZ AG
Phone: +43 (0) 1 88090 - 2291
Fax: +43 (0) 1 88090 - 8291
Listed: Freiverkehr in Berlin, München, Stuttgart; Frankfurt in
Open Market ; Wien (Amtlicher Handel / Official Market)
End of News DGAP News-Service
Press spacebar to pause and continue. Press esc to stop.