TAG Immobilien AG starts FY 2022 with an increase in FFO I, significant growth in Poland, and additional ESG initiatives

DGAP-News: TAG Immobilien AG / Key word(s): Quarterly / Interim Statement
TAG Immobilien AG starts FY 2022 with an increase in FFO I, significant growth in Poland, and additional ESG initiatives
24.05.2022 / 06:55
The issuer is solely responsible for the content of this announcement.


TAG Immobilien AG starts FY 2022 with an increase in FFO I, significant growth in Poland, and additional ESG initiatives

- FFO I for Q1 2022 at EUR 47.8m or EUR 0.33 per share (+5% y-o-y); strong cash earnings from operations in Poland expected and reflected in increased FFO II guidance for 2022 of EUR 247-253m (+32% vs. 2021)

- Total rental growth of 1.5% p.a. like-for-like, vacancy in TAG residential units at 5.7% in March 2022 and now at c. 5.3% (May 2022)

- Polish activities strengthened with acquisition of ROBYG effective 31 March 2022; foundation laid for the construction of c. 20,000 rental apartments in Poland over the next six to seven years

- ESG goals focused on ongoing implementation of the decarbonisation strategy and on liveable residential neighbourhoods at affordable rents

Hamburg, 24 May 2022

Key operating figures and earnings trend

TAG Immobilien AG (TAG) successfully continued its positive operating performance in the first quarter of 2022. On a like-for-like basis, rental growth in TAG’s residential units was 1.4% p.a., unchanged from the 2021 financial year. Including the effects of changes in vacancy, total like-for-like rental growth was 1.5%, up from 1.3% p.a. in 2021. In the first quarter of 2022, vacancy in TAG’s residential units initially increased slightly from 5.5% at the beginning of the year to 5.7% as at 31 March 2022, in line with the trend in the same period of the previous year. After the reporting period, the vacancy rate had already fallen to c. 5.3% in May 2022, forming a trend analogous to the prior years, with vacancy falling continuously over the rest of the year.

FFO I, which is still calculated solely based on the rental business in Germany at this time, rose by EUR 2.2m or 5% year-on-year in the reporting period. This increase was driven in particular by a EUR 1.9m rise in the operating result (adjusted EBITDA). Overall, TAG generated consolidated net income of EUR 32.3m in the first three months 2022, down from EUR 34.5m in the same period of the previous year. Going forward, FFO II will become more important as a reporting and management parameter, as it will also cover the earnings components of the Polish sales business. In the first quarter of 2022, FFO II was EUR 45.8m, compared to EUR 48.6m in Q1 2021. Results from the acquisition of ROBYG S.A. (ROBYG) were not yet included in FFO II for Q1 2022, as the initial consolidation of ROBYG took place with effect from 31 March 2022.

The already published guidance for the 2022 financial year for FFO I of EUR 188m to EUR 192m (EUR 1.30 per share), for FFO II of EUR 247m to EUR 253m (EUR 1.71 per share) and for the dividend of EUR 0.98 per share remain unchanged.

In the first quarter of 2022, the ROBYG acquisition expanded the contractually secured pipeline for the construction of apartments in Poland by nearly 25,000 units. As of the reporting date, the pipeline comprises c. 37,300 residential units. Of this total number, c. 19,100 apartments are currently slated for rent, and c. 18,200 apartments are earmarked for sale.

As a result of the war in Ukraine, more than three million Ukrainians have already fled to Poland, which has significantly increased the demand for housing, especially in urban centres such as Warsaw. Here, TAG can provide a significant supply in the medium term through the development of the total of around 37,000 residential units. Residential developments for letting in particular will benefit from this increased demand in the future. TAG is involved in Germany and Poland with donations and logistical assistance as well as apartments to accommodate refugees and will continue to face the challenges arising from the crisis-related refugee and migration flows from Ukraine in the future.

At the beginning of the 2022 financial year, TAG’s debt ratio temporarily increased due to the ROBYG acquisition. The loan-to-value (LTV) ratio increased to 47.3% as at 31 March 2022 from 43.2% at the end of the 2021 financial year. The average interest rate of the total financial liabilities was 1.45%, compared to 1.39% as at 31 December 2021. TAG’s credit risk is still rated as investment grade by the rating agencies Moody’s (Baa3, negative outlook) and S&P Global (BBB-, stable outlook).

Focus of sustainability activities: Climate protection and liveable residential neighbourhoods at affordable rents

The sustainability report for FY 2021, published on 21 April 2022, reported in detail on matters related to sustainability (ESG). TAG’s sustainability strategy addresses the economic, ecological, and social impact of the company’s activities. Key objectives include the provision of affordable housing, maximising the climate neutrality of the real-estate portfolio, and other aspects in the fields of customer service, employee satisfaction, corporate culture, and neighbourhood living.

The separate decarbonisation strategy and associated concrete planned investment programme of c. EUR 690m by 2045 form a focal point for the ecological goals. TAG CFO Martin Thiel comments: “With the planned investments to decarbonise our portfolio, and given our leading emissions profile compared with the rest of the industry, we see ourselves ideally positioned for long-term and sustainable growth. Furthermore, our significant project development pipeline in Poland, which we were able to expand substantially through the ROBYG acquisition, enables us to develop sustainable and emission-saving apartments in Poland as well, and to integrate them into our portfolio.”

Social aspects play an essential role in TAG’s long-term success, too, and do not conflict with its current and future economic success. “The systematic implementation of our sustainability strategy is essential to our business activities. By purchasing residential properties in locations away from the major metropolitan regions, we are making economically attractive investments with which we create housing for our tenants that is both affordable and attractive,” explains Claudia Hoyer, COO of TAG.

Further details on the first quarter of 2022 can be found in the interim statement published today and in the presentation at www.tag-ag.com/investor-relations.

Overview of key financials

Income statement key figures (in EUR millions) 01/01-03/31/2022 01/01-03/31/2021
Net actual rent 84.3 83.1
EBITDA (adjusted) 58.9 57.0
Consolidated net income 32.3 34.5
FFO I per share in EUR 0.33 0.31
FFO I 47.8 45.6
AFFO per share in EUR 0.22 0.21
AFFO 32.5 31.3
FFO II per share in EUR 0.31 0.33
FFO II 45.8 48.6
Balance sheet key figures (in EUR millions) 31 Mar 2022 31 Dec 2021
Total assets 8,236.8 7,088.6
EPRA NTA (fully diluted) per share in EUR 24.13 25.54
LTV in % 47.3 43.2
Portfolio data 03/31/2022 12/31/2021
Units Germany 87,539 87,576
Units Poland (contractually secured pipeline) 37,294 12,557
Real estate volume (total) 7,483.2 6,735.1
Real estate volume Germany 6,396.2 6,387.4
Property volume Poland 1,087.0 347.9
Vacancy in % (total Germany) 6.0 5.7
Vacancy in % (residential units Germany) 5.7* 5.4
l-f-l Rental growth in % (Germany) 1.4 1.4
l-f-l Rental growth in % (incl. vacancy reduction, Germany) 1.5 1.3

*incl. acquisitions in 2021

Press enquiries

TAG Real Estate AG
Dominique Mann
Head of Investor & Public Relations
Phone +49 (0) 40 380 32 305
Fax +49 (0) 40 380 32 390

24.05.2022 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.

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Company:TAG Immobilien AG
Steckelhörn 5
20457 Hamburg
Phone:040 380 32 0
Fax:040 380 32 388
Listed:Regulated Market in Frankfurt (Prime Standard), Munich; Regulated Unofficial Market in Berlin, Dusseldorf, Hamburg, Hanover, Stuttgart, Tradegate Exchange
EQS News ID:1359241

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