S IMMO AG: Very strong first half of 2017

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  • FFO I increased by 40.5%
  • Strong revaluation result of EUR 69.3m
  • Financial result improved by around EUR 17m
  • EPRA NAV increased to EUR 15.82 per share

The first six months of 2017 were again highly successful for S IMMO. FFO I – put simply, the key operating figure that describes how much was earned excluding revaluations and similar non-cash effects – was increased significantly to EUR 26.7m. The revaluation result is also very positive, amounting to EUR 69.3m in the first half of 2017 and due mainly to revaluations in Germany, Austria and Bulgaria. Ernst Vejdovszky, CEO of S IMMO AG, says: “We are currently seeing extremely high price levels on some of our markets, which is why we decided to sell a few of our larger properties. These sales support the extremely positive revaluation result and demonstrate the sustainability of our value appreciation strategy.”

    • Strong operating performance

    • S IMMO’s total revenue amounted to EUR 97.5m in the first half of 2017 (HY 2016: EUR 95.3m) and thus outperformed the previous year. Despite the extensive property sales in the previous year, rental income remained at the level of the first half of 2016 and amounted to EUR 58.5m as at 30 June 2017 (HY 2016: EUR 58.5m). Property management expenses fell to EUR 29.9m in the first half of the year (HY 2016: EUR 31.2m). The gross profit amounted to EUR 52.4m (HY 2016: EUR 50.5m). 

    • Successful property transactions

    • In the second quarter, S IMMO also signed contracts to sell Serdika Center along with the associated office space in Sofia. In mid-July, additional agreements for the disposal of two large office buildings in Vienna’s Viertel Zwei were concluded. 
    • However, S IMMO also made acquisitions in the first half of 2017. Thus, German properties were added to the S IMMO portfolio representing a transaction volume of more than EUR 30m in the reporting period. 

    • EBITDA and EBIT 

    • EBITDA increased to EUR 43.8m in the first half of 2017 (HY 2016: EUR 43.0m). The results from property valuation was again very positive and amounted to EUR 69.3m as at 30 June 2017 (HY 2016: EUR 106.9m). The main driver of this development was Germany, but Austria and CEE are also clearly positive. EBIT amounted to a good EUR 108.9m for the first half of 2017 (HY 2016: EUR 145.9m) as a result of the positive effects described above. This is more than double the EBIT for the first half of 2015, which was less affected by revaluation effects and amounted to EUR 48.9m.

    • Development of EBT, net income for the period and earnings per share

    • Net finance costs including the participating certificates result improved to EUR -21.6m year-on-year (HY 2016: EUR -38.6m). EBT consequently amounted to EUR 87.2m (HY 2016: EUR 107.3m). As a result of the effects described above, net income for the period totalled EUR 72.4m (HY 2016: EUR 85.5m) and earnings per share amounted to EUR 1.03 (HY 2016: EUR 1.27).

    • Strong growth for S IMMO share

    • The S IMMO share also achieved an extremely positive performance. In the first half of the year, the share posted a considerable increase of 27% – another significantly stronger performance compared to the ATX and IATX. In addition, the company increased the dividend for the fifth time in a row based on its record results in the previous year and paid out EUR 0.40 per share. Not least, rising investor interest was also reflected by the turnover of S IMMO shares, which has virtually doubled year-on-year. EPRA NAV per share was EUR 15.82 as at 30 June 2017. Compared to the year-end (31 December 2016: EUR 14.62 per share), despite the distribution of a record dividend a distinctly gratifying increase was achieved here, too. The discount on the share price (EUR 12.80 on 25 August 2017) compared to EPRA NAV shows that the S IMMO share still has considerable potential.

    • Outlook for 2017

Friedrich Wachernig, member of the S IMMO AG’s Management Board, is very optimistic for the current financial year: “At mid-year, we are absolutely satisfied with our results and very confident for the second half of the year. We will focus in particular on our project developments. We have a pipeline full of projects with a total investment volume of more than EUR 600m – our future income is thus secured.”


      Consolidated income statement for the period from 01 January 2017 to 30 June 2017

      in EUR million/fair-value method 

      thereof rental income58.558.5
      thereof revenues from operating costs19.318.4
      thereof revenues from hotel operations19.618.3
      Other operating income0.91.3
      Property operating expenses-29.9-31.2
      Hotel operating expenses-16.0-14.9
      Gross profit52.450.5
      Income from property disposals23.73.9
      Book value of property disposals-23.7-3.1
      Gains on property disposals00.8
      Management expenses-8.6-8.3
      Earnings before interest, tax, depreciation and amortisation (EBITDA)43.843.0
      Depreciation and amortisation-4.3-4.0
      Results from property valuation69.3106.9
      Operating result (EBIT)108.9145.9
      Financing result-19.0-35.3
      Participating certificates result-2.7-3.3
      Net income before tax (EBT)87.2107.3
      Taxes on income-14.9-21.7
      Consolidated net income for the period72.485.5
      of which attributable to shareholders in parent company68.584.6
      of which attributable to non-controlling interests3.90.9
      Earnings per share (in EUR)1.031.27