TAG Immobilien AG accelerates vacancy reduction and achieves strong operating results on the first half of 2013
TAG Immobilien AG / Key word(s): Half Year Results
TAG Immobilien AG accelerates vacancy reduction, achieves strong operating results with first-half FFO of EUR 31.5 million, and confirms its FFO forecast of EUR 68 million for the full year 2013.
- Funds from operations (FFO I) at EUR 31.5 million
- Vacancy in the residential portfolio drops to 9.3%
- Vacancy in Salzgitter below 20% for the first time
- NAV per share of EUR 9.81 after dividend payment of 25 cents in Q2
- Convertible bonds partially repurchased to achieve balance sheet optimisation and interest savings
- EUR 200 million five-year bond successfully placed
Hamburg (8 August 2013) - In the first half of 2013, TAG Immobilien AG ('TAG' in the following) fully completed the integration of the TAG Wohnen inventory and showed strong operating profitability across the Group's overall portfolio of around 70,000 units. Further successes in vacancy reduction, rent increases, and cost savings from refinancing loans will also have a slightly delayed effect on earnings during the year. The repurchasing of convertible bonds and the issuance of a corporate bond further optimised the company's balance sheet and reduced dilutive effects for shareholders. The financials of the first half of 2013 are a testament to TAG's successful performance.
Total revenues doubled from EUR 118.0 million in the first half of 2012 to EUR 236.7 million at the end of June 2013. Rental revenues increased from EUR 87.4 million in the first half of 2012 to EUR 125.6 million in 2013. This results in net rental income of EUR 98.5 million (previous year EUR 67.3 million) and, with a margin of close to 80%, demonstrates the portfolio's operational profitability. New rental contracts/business increased across the Group, further improving the vacancy rate in the residential sector from 9.9% at year-end 2012 to 9.3%. The continued improvement in Salzgitter is particularly noteworthy: here, vacancy has sunk below the 20% mark for the first time at 19.9% and is thus 0.9% better than at the end of the first quarter of 2013.
The Group's earnings before taxes (EBT) in the first half of 2013 amounted to EUR 25.0 million. Given the company's strong growth in 2012, net interest in the first half of 2013 was at a corresponding level at EUR -50.9 million. Funds from operations, an indicator of operational performance, amounted to EUR 31.5 million in the first half of 2013 excluding sales (FFO I), or EUR 79.1 million including the cash income and cash flows from property sales (FFO II).
At EUR 3.7 billion, the balance sheet total at 30 June 2013 was almost unchanged from year-end 2012. In parallel, the real estate volume was EUR 3.692 million at the end of the first half of 2013. The equity ratio before minorities is 30.7 percent and the LTV (loan to value) ratio around 58.3 percent, with both variables having significantly improved once again in the end of 2012. In the first half of 2013, NAV (net asset value) per share amounted to EUR 9.81 compared to EUR 9.96 at year-end 2012, and following a dividend payment of EUR 0.25 in the second quarter of 2013.
To optimise the balance sheet structure, at the beginning of August 2013, TAG is repurchasing nearly a third of the outstanding convertible bonds, thereby reducing the dilutive effect of these bonds. The repurchase invitation submitted to the holders of convertible bonds at the end of July 2013 was positively received by creditors. At the same time, this measure leads to a saving in interest charges. The cash equivalent of EUR 76.4 million required for the repurchase was simultaneously raised by the issuance of a EUR 200 million unsecured bond with a term of 5 years and a coupon rate of 5.125%. At the end of July 2013, the bond was placed on the market within a day, significantly oversubscribed and below the originally stipulated interest margin.
'The figures for the first half of 2013 already demonstrate our company's operational profitability. Successful vacancy reduction and reasonable rent increases on the one hand, and interest savings through favourable refinancing terms on the other, will continue to increase cash flow and earnings in the second half of the year. We are therefore more than well on track to achieve our FFO guidance of EUR 68 million. Due to this strong operational picture and a slight decline in our share price since the beginning of the year, we decided, in the interest of our shareholders to repurchase a portion of our convertible bonds,' said Rolf Elgeti, Chairman of the Management Board of TAG Immobilien AG.
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|Company:||TAG Immobilien AG|
|Phone:||040 380 32 0|
|Fax:||040 380 32 390|
|Listed:||Regulierter Markt in Frankfurt (Prime Standard), München; Freiverkehr in Berlin, Düsseldorf, Hamburg, Hannover, Stuttgart|
|End of News||DGAP News-Service|