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TAG Immobilien AG: TAG with a substantial increase in rental income

TAG Immobilien AG: TAG with a substantial increase in rental income

TAG Immobilien AG / Quarter Results

 

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AG.

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PRESS RELEASE

 

Report on the first nine months of 2008

 

TAG with a substantial increase in rental income

 

- Operating earnings improved

- Current liabilities reduced

- Revenue and earnings forecast adjusted

 

(Hamburg, 13 November 2008) In the first nine months of 2008, TAG

Immobilien AG was able to further improve its business performance, with

revenues rising by 37 percent over the year-ago period from EUR 58.3

million to 80.1 million. This was accompanied by a disproportionately

strong 44 % increase in rental income from EUR 26.5 million to 38.2

million, underpinned by the newly acquired cash-flow-heavy portfolios such

as the Siemens portfolio (commercial) and the VBL portfolio (residential)

together with reduced vacancies and rental hikes.

 

Operating earnings improved particularly as a result of the increased

revenues and net rental income. At EUR 44.4 million, gross profit for the

period under review remained steady at the year-ago figure despite the

reduced fair value remeasurement gains. EBT came to EUR 6.7 million in the

first nine months of 2008. A balanced figure was also achieved at the EBT

level in the third quarter against the backdrop of increased interest

expense resulting from the greater real estate volumes and lower fair value

remeasurement gains.

 

'Banks’ substantially more restrictive lending practices already started

making themselves felt on potential buyers’ ability to arrange finance in

the third quarter, causing delays in transactions for the purchase and sale

of real estate. Given the crisis afflicting the financial markets and the

fall-out for the real economy, the Company is currently unable to issue any

reliable forecasts for 2008,' says Andreas Ibel, CEO of TAG Immobilien AG.

 

As it is not possible to tell whether TAG will be able to achieve its

budgeted sales by the end of 2008, the Company is adjusting its revenue and

earnings forecast. However, the current conditions may not only affect

planned real estate sales but also impact the fair value of individual

properties. Accordingly, TAG’s Management Board expects the Company to

break even at the EBT level in 2008 as a whole.

 

Despite the revised expectations for 2008, the Company will master the

challenges arising from the crisis thanks to increased rental income, its

solid financial structure and its concentration on the German real estate

market with properties in good urban locations.

 

Solid financial condition

 

TAG Immobilien AG has a highly solid financial base:

At around 33 percent at the end of the third quarter, the equity ratio was

high by sector standards. As well as this, current liabilities to banks

contracted from EUR 217 million at the end of 2007 to EUR 106 million as of

30 September 2008. At the same time, non-current liabilities rose from EUR

296 million to EUR 433 million. Despite the current adverse conditions in

the credit markets, TAG assumes that all loans will be renewed upon expiry.

 

About TAG Immobilien AG

 

A real estate company listed in the SDAX, TAG Immobilien AG can look back

on a history spanning 125 years. TAG’s main business activities entail

residential and commercial real estate in good urban locations in German

metropolitan regions as well as the provision of real estate services.

 

The Group’s operating business is primarily performed by its subsidiary,

the listed company Bau-Verein zu Hamburg AG as well as TAG

Gewerbeimmobilien AG and TAG Asset Management GmbH.

 

TAG has branches in Hamburg, Berlin, Leipzig and Munich.

 

Press inquiries:

 

TAG Immobilien AG

Kirsten Schleicher

Head of Investor & Public Relations

Tel. +49 (0) 40 380 32 300

Fax +49 (0) 40 380 32 388

pr@tag-ag.com

 

 

 

Contact:

TAG Immobilien AG

Head of investor and public relations

Kirsten Schleicher

 

Tel. +49 (0) 40 380 32 300

Fax +49 (0) 40 380 32 388

pr@tag-ag.com

 

 

 

 

13.11.2008 Financial News transmitted by DGAP


 

Language: English

Issuer: TAG Immobilien AG

Steckelhörn 5

20457 Hamburg

Deutschland

Phone: 040 380 32-300

Fax: 040 / 380 32-388

E-mail: info@tag-ag.com

Internet: www.tag-ag.com

ISIN: DE0008303504

WKN: 830350

Indices: SDAX

Listed: Regulierter Markt in Frankfurt (Prime Standard), München;

Freiverkehr in Berlin, Hannover, Hamburg, Düsseldorf,

Stuttgart

 

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