Significant improvement in key operating indicators
- Total revenues up considerably at EUR 161.4m
- Increase in rental income to EUR 93.9m
- Result from hotel operations rises by more than 50% to EUR 8.0m
- Gross profit up more than 35% at EUR 86.0m
- Valuation result of EUR -80.8m due to market conditions
S IMMO AG is pleased to publish the results of a strong operating performance for the first half of 2023.
Increasing revenues and profitability
Total revenues were EUR 161.4m, up from EUR 119.6m in the prior year. Rental income was EUR 93.9m (HY 2022: EUR 73.0m). This increase reflects the positive impact from acquisitions of higher-yielding properties. Revenues from hotel operations rose to EUR 31.4m (HY 2022: EUR 23.7m), and the result from hotel operations rose to EUR 8.0m (HY 2022: EUR 5.2m) as travel across Europe recovered strongly. Gross profit improved by more than 35% to EUR 86.0m, while EBITDA rose by almost 40% to EUR 68.1m.
Radka Doehring, Member of the Management Board, comments: "We are particularly proud of S IMMO’s improved key figures such as the significant increases in rental income and gross profit. The whole team at S IMMO also continues to make excellent progress on our efforts to achieve synergies through our framework agreement with IMMOFINANZ and CPIPG.”
Valuations and net result
S IMMO recorded a negative valuation result of EUR -80.8m for HY 2023, especially in Germany where the company’s properties are lower-yielding. Primarily as a result of these non-cash effects, the consolidated net result for the period was EUR -40.2m.
Acquisitions and sales
Strategic sales of German residential and commercial properties continued in the first half of 2023. Since the strategy update in the fall of the previous year, sales contracts have been signed in Germany for 167 properties with a total value of EUR 617m. Some of the transactions are still in the process of closing. Additional disposals of properties in Germany with a total value of over EUR 340m are also currently being explored, along with other opportunities.
Proceeds from sales have been reinvested into higher-yielding properties. For example, the Twin Towers in the Wienerberg area of Vienna were acquired in July 2023. The two office towers comprise a gross lettable area of around 66,000 m² and generate annual rental income of EUR 12.6m.
Herwig Teufelsdorfer, Member of the Management Board, comments: “Our strategic approach of selling residential and commercial properties in Germany and reinvesting the liquidity gained in high-yield properties is paying off. The operational successes prove that S IMMO is on the right track. In particular, the acquisitions made in recent months are making a strong contribution to earnings while at the same time securing our future earnings strength.”
Capital market
As of 30 June 2023, the S IMMO share was trading at EUR 12.20, translating into a year-to-date performance of -2.24%. In July 2023, S IMMO issued a EUR 75m 5-year green bond with a coupon of 5.5% p.a. The bond was primarily sold to local investors. S IMMO continues to enjoy strong banking and bond investor relationships.
Outlook 2023
Over the last few months, a uniform ESG strategy was developed within CPI Property Group and adopted by the end of August. The common ESG goals include, for example, the reduction of energy, water and greenhouse gas intensities by 2030, the purchase of electricity from 100% renewable energy sources and an increase in the proportion of certified buildings. The introduction of green lease contracts, mandatory compliance training and a training quota for all employees are now also being jointly promoted.
S IMMO’s key factors are continuity and its core business: purchasing, letting and managing high-yield properties to boost cash flow on a lasting basis. Against this backdrop, S IMMO intends to continue pursuing strategies to optimise the portfolio through smart asset management and investment in higher-yielding properties, all while maintaining a conservative capital structure.
Consolidated income statement for the period 01 January 2023 – 30 June 2023
in EUR m / fair value method
01–06/2023 | 01–06/2022 | |
| Revenues | 161.4 | 119.6 |
| thereof rental income | 93.9 | 73.0 |
| thereof revenues from operating costs | 36.2 | 22.8 |
| thereof revenues from hotel operations | 31.4 | 23.7 |
| Other operating income | 1.7 | 0.9 |
| Property operating expenses | -53.7 | -38.5 |
| Hotel operating expenses | -23.4 | -18.5 |
| Gross profit | 86.0 | 63.4 |
| Income from property disposals | 533.5 | 0 |
| Book value of disposed properties | -533.5 | 0 |
| Result from property disposals | 0.0 | 0.0 |
| Management expenses | -17.9 | -14.5 |
| EBITDA | 68.1 | 48.9 |
| Depreciation and amortisation | -4.7 | -4.8 |
| Results from property valuation | -80.8 | 20.8 |
| Operating result (EBIT) | -17.4 | 64.8 |
| Financial result | -22.0 | 0.1 |
| Earnings before tax (EBT) | -39.3 | 65.0 |
| Taxes on income | -0.9 | -3.1 |
| Consolidated net result for the period | -40.2 | 61.9 |
| thereof attributable to shareholders in the parent company | -33.8 | 61.8 |
| thereof attributable to non-controlling interests | -6.4 | 0.09 |
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| Earnings per share (in EUR) | -0.48 | 0.88 |
