Gagfah SA (GFJ), the third-biggest owner of German homes, said this year’s earnings will be at the upper end of its target as the company works to improve its performance after refinancing more than 4 billion euros ($5.5 billion) of debt.
Funds from operations excluding asset sales, a measure of a real estate company’s ability to generate cash, rose 7 percent to 60 cents a share in 2013, meeting Gagfah’s forecast, the Luxembourg-based company said in a statement today. FFO will gain about 35 percent to between 80 and 82 cents a share in 2014, Gagfah said.
Gagfah has been selling properties to help refinance debt and withdraw from regions that aren’t vital to its business. Fortress Investment Group LLC (FIG) cut its stake to 41 percent in December from about 66 percent in June. Gagfah repeated that it plans to pay a 2014 dividend of between 20 and 25 cents a share. The last dividend was in 2010, according to data compiled by Bloomberg.
“We have successfully laid the groundwork for an improved operational performance and for strong FFO growth this year, and we are very confident about our targets for 2014 and beyond,” Chief Executive Officer Thomas Zinnoecker said in the statement.
Gagfah had previously said 2013 FFO will rise between 5 and 10 percent in 2013 and between 30 and 35 percent in 2014. The company today forecast an increase of about 10 percent to between 88 and 90 cents for 2015.
Gagfah is due to release 2013 earnings on March 26.
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