conwert Immobilien Invest SE

conwert sees positive operating stimuli in first half 2014 - Seite 2

Loan to value (LTV), i.e. debt in relation to property projects minus cash and cash equivalents, was unchanged at the reporting date at 54.4% against the first quarter 2014 (31/12/2013: 55.9%) and therefore within the target range of 50 to 55%.

Higher property expenses, which resulted mainly from the portfolios acquired in Germany in 2013, led to a 13.5% decline in funds from operations before sales income and one-off costs (FFO I) in the first half 2014 to EUR15.4 mn (1-6/2013: EUR17.8 mn after adjustments to the reporting system, resp. EUR18.4 mn under last year's reporting system). FFO II (FFO I plus sales income) amounted to EUR18.7 mn (1-6/2013: EUR27.1 mn) and was therefore just 31.0% below the figure for the comparable period in the previous year despite a 75.1% reduction in sales revenues.

Clemens Schneider, conwert CEO, on the results: "Following the purchases in Germany in 2013, conwert has succeeded in securing operating stimuli in the first half 2014. The improvements in vacancy rates and rental revenues, while simultaneously cutting costs, underline the positive operating developments in the first half 2014. Nevertheless, we have a lot of work ahead in order to achieve attractive returns for our shareholders."

The focus of conwert's business activities in 2014 will be on integrating the portfolios acquired in 2013 (KWG and GE). The focus on the six core markets (Vienna, Berlin, Potsdam, Dresden, Leipzig, North Rhine-Westphalia) should facilitate further improvements to the operating profitability of the portfolio and is tied to continuing sales activities for the ECO, commercial and CEE portfolios. conwert continues to forecast sales revenues of EUR150-200 mn for the full year 2014. Management expects to achieve FFO I of over EUR30 mn for 2014 and FFO I of EUR40 mn for 2015.

Key performance indicators , , 1-6/2014 , 1-6/2013 (adjusted)*) , Change , 2013 , Rental income , mn EUR , 121.2 , 113.2 , 7.1% , 227.3 , Proceeds from sale of properties , mn EUR , 36.3 , 145.6 , -75.1% , 273.9 , Revenues from property services , mn EUR , 4.5 , 9.9 , -54.5% , 15.2 , Total revenues , mn EUR , 162.0 , 268.6 , -39.7% , 516.4 , EBITDA , mn EUR , 54.9 , 65.2 , -15.8% , 116.8 , EBIT , mn EUR , 47.1 , 63.7 , -26.1% , 123.4 , EBT , mn EUR , (26.0) , 29.6 , - , 48.7 , Funds from operations before sales income and one-off items (FFO I) **) , mn EUR , 15.4 , 17.8 , -13.5% , 36.2 , Funds from operations after net finance income/costs (FFO II) ***) , mn EUR , 18.7 , 27.1 , -31.0% , 52.1 , Net rental income (NRI) , mn EUR , 74.4 , 73.0 , 1.9% , 141.4 , NRI margin , % , 61.4 , 64.5 , -4.8% , 62.2 , Basic earnings/share , EUR , (0.30) , 0.21 , - , 0.09 , Diluted earnings/share , EUR , (0.19) , 0.22 , - , 0.18 , FFO I **) / share , EUR , 0.19 , 0.22 , -13.6% , 0.44 , *) The interim financial statements as at 30 June 2013 recognised a gain on bargain purchase of Eur7.3 mn, which was amended to Eur1.0 mn in the fourth quarter 2013. For interim reporting purposes, recognition of this merger has been adjusted retrospectively. **) FFO I: Earnings before tax (EBT) - difference between sales and carrying amount of sold properties + operating expenses of sales income -/+ revaluation gains/losses + depreciation and value adjustments + non-cash components of financial income and other non-cash costs not including non-controlling interests + restructuring costs/one-off costs ***) FFO II: FFO I + difference between sales and carrying amount of properties sold - operating expenses of sales income