S IMMO AG: results higher again
Net profit for period increased to EUR 22.2m
- EBIT up at EUR 74.9m
- EBT improved by 6.6%
- Successful issue of EUR 100m corporate bond
- Targets for 2014 confirmed
Stock exchange listed S IMMO AG (Bloomberg: SPI.AV, Reuters: SIAG.VI) looks back on a highly successful third quarter of 2014. Ernst Vejdovszky, Chairman of S IMMO AG’s Management Board, comments: “We are definitely on the way to achieving our targets for the current financial year. Based on these impressive quarterly figures, we are happy to confirm that for the year as a whole we shall improve upon the Group’s very good results in 2013.”
Friedrich Wachernig, member of S IMMO AG’s Management Board, continues: “We sense movement and growing optimism in the countries we are active in. Successful lettings – such as those in Budapest recently – provide further confirmation. In addition, the historically low level of interest rates is also having very beneficial effects on our industry.”
In the first nine months of 2014, S IMMO’s revenues amounted to EUR 140.5m, compared with EUR 145.3m in the same period last year. Despite property disposals, the rental income still came out at EUR 84.5m (Q3 2013: EUR 88.3m). Revenues from hotel operations rose to EUR 30.2m, after EUR 29.2m for the first three quarters of 2013. Gross profit from hotel operations improved from EUR 6.5m to EUR 6.9m.
Property management expenses of EUR 41.0m in the first three quarters of 2014 decreased by 10.6%, compared with EUR 45.9m for the same period last year. Reductions in property related costs, combined with a higher gross profit from hotel operations, largely made up for the lower rental income as a result of property sales. The good operating performance meant that the gross profit remained nearly unchanged as against the previous year despite the reduction in rental income resulting from property disposals.
EBITDA and EBIT
EBITDA for the first three quarters was EUR 67.6m, compared with EUR 75.4m in the same period in 2013. Total property revaluations amounted to EUR 12.8m (Q3 2013: EUR 4.0m). EBIT came to EUR 74.9m, being higher than the EUR 72.2m in the same period last year.
Net profit for period higher again
The financial result for the first three quarters of 2014 including the participating certificates results amounted to EUR -47.6m, as against EUR -46.6m for the first nine months of 2013. This was achieved in spite of negative foreign currency effects. EBT came out at EUR 27.3m, an increase of 6.6% on the EUR 25.6m for the same period last year. The consolidated net profit rose to EUR 22.2m (Q3 2013: EUR 21.4m).
Key indicators at last year’s very satisfactory levels
FFO I (Funds from operations) for the first three quarters of 2014 amounted to EUR 17.9m, compared with EUR 22.5m a year earlier. FFO II, which includes gains on property sales and valuation gains on properties sold in the current year, was EUR 33.1m, 3.2% better than the EUR 32.1m in the same period in 2013.
Net operating income (NOI) for the period was EUR 76.3m, compared with EUR 76.7m a year earlier. The NOI margin improved by 1.5 percentage points to 54.3%.
As at 30 September 2014, both balance sheet NAV (book value) and EPRA NAV per share rose: the book value per share stood at EUR 7.97 (31 December 2013: EUR 7.83), while EPRA NAV per share was EUR 9.89 (31 December 2013: EUR 9.76).
Capital markets continue to be dynamic: The S IMMO share closed the third quarter at EUR 6.160 for a very satisfactory year-to-date gain of 16.5%. This means that the share significantly outperformed the ATX and IATX.
At the end of September, S IMMO issued a EUR 100m five-year corporate bond with a coupon of 3% p.a., thus using the favourable interest environment to drive the growth of the Group forward. The bond was almost three times oversubscribed when placed with institutional investors and was a complete success.
S IMMO AG’s strategy remains unchanged: the Group invests in four property use types and in four regions, focusing on European Union capital cities. This makes it possible to take advantage of different real estate cycles, and recognise potential early. The focus is primarily on the booming property market in Berlin, where the home ownership ratio of around 15% and continuing high influx make for a very attractive scenario. S IMMO is planning to construct freehold apartment projects on land it already owns. At the same time, the Group is looking into investments in commercial properties.
On the basis of the good quarterly results, the Management Board reaffirms its goal for the financial year 2014: once again to increase the results of the previous year. The Group also intends to continue to pursue its steady dividend policy.
|01 – 09/2014||01 – 09/2013*|
|Revenues from operating costs||25.9||27.9|
|Revenues from hotel operations||30.2||29.2|
|Other operating income||3.5||4.6|
|Expenses directly attributable to properties||-41.0||-45.9|
|Hotel operating expenses||-23.2||-22.7|
|Income from property disposals||48.4||90.9|
|Book value of property disposals||-48.4||-85.8|
|Gains on property disposals||0||5.1|
|Earnings before interest, tax, depreciation and amortisation (EBITDA)||67.6||75.4|
|Depreciation and amortisation||-5.5||-7.2|
|Gains on property valuation||12.8||4.0|
|Operating profit (EBIT)||74.9||72.2|
|Income from companies measured at equity||0.4||0|
|Participating certificates results||-4.1||-8.8|
|Net income before tax (EBT)||27.3||25.6|
|Taxes on income||-5.1||-4.2|
|Consolidated net income for the period||22.2||21.4|
|of which attributable to shareholders in parent company||20.2||19.6|
|of which attributable to non-controlling interests||2.0||1.8|
|Earnings per share (EUR)||0.30||0.29|