DGAP-News: ADLER Real Estate AG / Key word(s): Miscellaneous
ADLER Real Estate: recent portfolio acquisitions have substantial
effect on earnings
10.07.2014 / 20:45
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ADLER Real Estate: recent portfolio acquisitions have substantial effect on
earnings
- Net rent and cash flow of the Group increased substantially
- EPRA NAV of ADLER Group at approx. EUR 11 per share
- LTV decreased considerably to around 65 percent
Hamburg 10 July 2014. The most recent and also largest portfolio
acquisitions made by
ADLER Real Estate AG, Frankfurt/M., ("ADLER," ISIN DE0005008007) included
seven property holding companies - concluded in June 2014 - and the
takeover of 92.7 percent in ESTAVIS AG, Berlin, substantially improved the
value and profitability of ADLER. The balance sheet of the expanded group
is estimated to have been increased to roughly EUR 1.25 billion at the end
of the first half of 2014. Investment properties have been included with an
estimated book value of around EUR 1.07 billion. The balance sheet total
amounted to EUR 540.9 million at the end of the first quarter 2014. The
management board of
ADLER estimated that the ratio of liabilities to assets in the balance
sheet (LTV = Loan to Value), which is a key ratio for real estate
companies, substantially improved and decreased slightly to just over 65
percent as at 30 June 2014 (end of 2013: 71 percent).
The management board expects an increase in equity to more than EUR 290
million (31 March 2014: EUR 115.3 million). This increase results from the
consolidation and first-time recognition of the acquired assets in
accordance with IFRS, resulting in a three-digit million figure for ADLER
in the first half of 2014. Due to effects from fair value measurements, the
consolidated group results had increased to EUR 21.4 million in the first
quarter of 2014. Consolidated revenues in the first half of 2014 will most
likely increase to roughly EUR 25 million due to higher rental incomes
(first half of 2013: EUR 2.8 million). The EPRA NAV (Net Asset Value
according to the calculation standards of the European Real Estate
Association) of the expanded ADLER group is now at approx. EUR 11 per share
per 30 June 2014 - which is significantly above the current share price.
The portfolio acquisitions have set a foundation for significantly
increasing revenues. Projected on a 12-month period, ADLER's existing real
estate portfolio will generate net rent income of approx. EUR 77 million
and a positive cash flow of roughly EUR 20 million. Income from the
operating business (funds from operations = FFO) are also expected to
increase to EUR 20 million. The FFO including disposals for the first
quarter 2014 amounted to just EUR 1.5 million - which ADLER is reporting
for the first time. Due to continuing work required on the financial
statements, ADLER is expected to publish its half-year financial statement
on 31 August 2014.
"We have accomplished two major steps in the first half of the year in our
objective to evolve into a major residential real estate company and
simultaneously improve our solid position and opportunity for further value
growth and higher earnings", Axel Harloff, CEO of ADLER Real Estate, sums
up. The eight property portfolios recently acquired together include
approx. 8,500 residential and commercial units. The value alone of these
portfolios amounts to roughly EUR 409 million. Together with the ESTAVIS
portfolios, ADLER now manages roughly 21,000 residential units. This number
will even increase to roughly 25,000 units after an acquisition close which
was signed by ESTAVIS in March 2014.
"We are working to significantly improve on last year's occupancy rate of
91 percent", Harloff explains. ADLER has systematically invested in vacant
apartments of the acquired portfolios and benefited afterwards with new
renters. The rental markets in almost all German regions have improved. The
German Property Index (GPI) of the research institute BulwienGesa, measured
an increase in value and cash flow return of German real estate of +12.6
percent.
The research institute expects that rent prices will rise going forward. As
a result of the combination of economic growth and the effects of
fundamental factors, like increasing floor space consumption or people
moving into congested urban areas, the institute projects the best future
performance in the residential real estate market compared with all other
sub-markets of the real estate sector. Additional potential exists in the
so called B locations as a result of lacking affordable property for rent
and increasing number of prospective tenants in the outskirts of urban
regions. According to surveys done by the online platform
ImmobilienScout24, tenants are showing a growing willingness to pay more.
"Our portfolios should benefit from these developments", Harloff comments.
In Duisburg for example, where ADLER manages approx. 4,000 apartments, the
willingness to pay increased in 2013 by an average of 5.6 percent. In the
Wolfsburg region, close to Helmstedt, where ADLER manages roughly 2,300
residential units, rents increased by 127 percent between 2009 and 2013
according to data compiled by the platform Immonet. And in Dresden (ADLER
has approx. 1,500 units), rents increased already by 5.9 percent between
2011 and 2013. "We will benefit from these developments through our
investments and enhanced distribution measures", says Harloff.
For inquiries please contact:
Press: german communications dbk ag
Jörg Bretschneider
Milchstr. 6 B, 20148 Hamburg, Germany
Phone: +49-(0)40/46 88 33 0
Fax: +49-(0)40/46 88 33 40
presse@german-communications.com
Investor Relations: Hillermann Consulting
Christian Hillermann
PoststraÃe 14, 20354 Hamburg, Germany
Phone: +49-(0)40/32 02 79 10
Fax: +49-(0)40/32 02 79 114
c.hillermann@hillermann-consulting.de
End of Corporate News
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Language: English
Company: ADLER Real Estate AG
Alstertor 17
20095 Hamburg
Germany
Phone: +49 (0)40 - 29 8130-0
Fax: +49 (0)40 - 29 8130-35
E-mail: info@adler-ag.com
Internet: www.adler-ag.com
ISIN: DE0005008007, DE000A1R1A42,
WKN: 500800, A1R1A4
Listed: Regulierter Markt in Frankfurt (Prime Standard);
Freiverkehr in Berlin, Düsseldorf, Hamburg
End of News DGAP News-Service
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277540 10.07.2014
DGAP-News: ADLER Real Estate: recent portfolio acquisitions have substantial effect on earnings
| Source: EQS Group AG