Interim Report Q1 2016/17

Aalborg, Denmark, 2016-06-15 08:41 CEST (GLOBE NEWSWIRE) --  

SUMMARY

Results for the first quarter of 2016/17

The results before tax amounted to DKK -4.1 million in Q1 2016/17 against DKK -5.9 million in Q1 2015/16. The results after tax amounted to DKK -3.7 million against DKK -6.7 million in Q1 2015/16.

The balance sheet total amounted to DKK 2,855.1 million at 30 April 2016 against DKK 2,808.8 million at 31 January 2016. Consolidated equity totalled DKK 1,281.4 million, and the solvency ratio stood at 44.9 %.

Breakdown by segment: 

Outlook for 2016/17

Management still expects consolidated results before tax for 2016/17 to total DKK 10-30 million. 

This profit estimate is based on the expectation that a number of ongoing small and medium-sized projects will be executed before the end of the current financial year. TK Development is recording good progress on the individual projects. The time horizon for the projects means that the majority of them are expected to be completed, handed over to the investor and thus recognized in income in Q4 2016/17. The Group’s most significant development projects are not expected to contribute to consolidated results until subsequent financial years. 

Property development

The results for this business area amounted to DKK 2.6 million before tax in Q1 2016/17. At 30 April 2016 the balance sheet total came to DKK 1,166.9 million, and the equity tied up represented DKK 644.9 million. 

As from the 2017/18 financial year, the return on equity from this business area is expected to amount to 15-20 % p.a. before tax. 

The sales completed by TK Development in Q1 2016/17 included a superstore of about 2,150 m² in Rødekro. 

Major development projects in progress:

• Construction of the new shopping centre, BROEN Shopping, in Esbjerg, Denmark, is progressing according to plan, and the opening is scheduled for spring 2017. The current occupancy rate is 73 % of the premises. 

• Construction of Strædet in Køge, Denmark, is now on schedule and expected to be completed in autumn 2017. The retail project, of which 74 % has been let, has been sold conditionally to the Finnish company Citycon together with the parking facilities.

• The second phase of the residential project in Bielany in Warsaw, Poland, was completed in the period under review, and an occupancy permit was obtained immediately after the reporting date. 93 % of the units have been sold in advance, and the handover to the buyers of the individual units has begun. 

• The project pipeline is looking strong, and the projects are moving ahead at a good pace due to robust tenant and investor interest. 

Asset management

The results for this business area amounted to DKK -4.1 million before tax in Q1 2016/17. At 30 April 2016 the balance sheet total came to DKK 1,604.9 million, and the equity tied up represented DKK 573.0 million. 

The portfolio of completed properties in this business area consists of 156,200 m², amounting to DKK 1,581.8 million at 30 April 2016. This amount includes joint venture projects. The annual net rent from the current leases corresponds to a return on the carrying amount of 4.4 %. Based on full occupancy, the return on the carrying amount is expected to reach 6.1 %. 

Detailed development and operating plans have been drafted for each property, and good progress is being made in their realization in a number of areas. 

The expectations mentioned in this Interim Report, including earnings expectations, are naturally subject to risks and uncertainties, which may result in deviations from the expected results. Expectations may be impacted by factors generally applicable to the sector as well as the factors referred to in the Group’s 2015/16 Annual Report under Risk issues and note 2 to the consolidated financial statements, Accounting estimates and judgments, including the valuation of the Group’s project portfolio.

Further information is available from Frede Clausen, President and CEO, on tel. +45 8896 1010.