Company Presentation – August 2017 H1 2017 results ADLER REAL ESTATE AG
Content 1. ADLER Real Estate AG – at a glance 2. Market environment 3. H1 2017 Financial performance 4. H1 2017 Operational performance Company presentation 5. ACCENTRO Real Estate AG H1 2017 6. ADLER on the Capital Markets 7. Governance and operational organisation 8. Guidance and outlook Unlock organic growth potential Page 2
1. ADLER Real Estate AG - at a glance An ongoing success story 3
1.1 ADLER Real Estate AG – at a glance ■ A leading listed real estate company in Germany ■ SDAX-listed since 2015 (also included in FTSE EPRA/Nareit, Global Real Estate Index, GPR General Index, DIMAX) ■ Focus on growth and value creation ■ Event-driven/special situation strategy ■ Strong acquisition-led growth 2013 to 2015 and consolidation in 2016, growth and capital structure optimization in 2017 ■ Focus on affordable housing in specific regions in Germany Supplier of affordable housing A clear equity story for value investors Page 4
1.2 ADLER Real Estate AG – at a glance ■ Significant FFO increases for the next 3 years Through operational efficiencies Through reduction of interest expenses for higher yielding debt Further portfolio growth (pipeline of ca. 7,500 units) ■ Continued improvements of key financial metrics Reduction of LTV from 66.9% (2013) to 57,8% (H1 2017) Reduction of WACD from 4.70% (2013) to 3.66% (H1 2017) Rating improvements from B+ to BB-/positive outlook ■ Internalisation of key operational functions Property management A simple, clear Facility management business model Consistently delivering on targets and building a stronger track record Page 5
1.3 Execution and track record of growth From 7,000 to 50,000 units in 3 years Acquisitions/Disposals Successful disposal of Berlin assets 2014 2016 2015 2017 1,174 units Portfolio Acquisition of 160 units 24.79% of ATX listed ESTAVIS AG conwert Immobilien Successful disposal Stake in conwert Westgrund AG ADLER announces a 2,100 units Invest SE of legacy sold to Vonovia SE Takeover offer package of 29,896 units Portfolio Commercial assets c. 21,000 units Portfolio measures to 200 units 2,400 units sustainably boost Additional 5m shares Portfolio Ajax portfolio earnings strength Portfolio Portfolio 6,750 in conwert aquired Portfolio Portfolio c. 2,700 units 700 units 4,300 units units 8,500 units 1,906 units J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J Buyback ACCENTRO Mandatory Convertible Bond Corporate Bond Tap 14/19 Tap 14/19 Tap Corporate convertible Convertible Bond 16/21 EUR 12m 14/19 Corporate Bond Corporate Bond Bond 15/20 Redemption (IFRS Equity) EUR 137m EUR 50m EUR 50m EUR 50m EUR 30m Schuldscheindarlehen EUR 175m Change in the EUR 30m Redemption Group’s Corporate Bond 14/19 Management Board Capital increase Capital Increase Bond 15/20 EUR 130m EUR 80m EUR 21m Redemption Redemption EUR 300m Schuldscheindarlehen Margin Loan EUR 62m EUR 200m Tap Corporate Capital increase Bond 15/20 EUR 190m EUR 150m Capital markets Considerable growth and value creation as a result of a successful strategy and its execution Page 6
1.4 Strong performance track record Growth and value creation + 1.2% Net rental income Number of rental units Market value investment properties € m € m € m 60,000 2,235 2,442 2,505 48,218 47,662 48,233 + 3.0% 200 50,000 2,500 40,000 150 2,000 + 2.6% 30,000 20,086 1,171 86.4 1,500 100 20,000 1,000 43.9 418 7,797 50 10,000 0,500 0,000 0,000 0 3M 6M 9M FY 2013 2014 2015 2016 H1 2013 2014 2015 2016 H1 2016 2017 2017 2017 FFO I NAV LTV + 2.3% € m % € m + 30.8% 30 1,066 1,094 68.7 1,200 68.0 70 66.9 - 3.5 PP 880 1,000 65 20 15.7 0,800 61.3 0,600 60 57.8 7.9 351 10 0,400 55 95 0,200 0 50 0,000 3M 6M 9M FY 2013 2014 2015 2016 H1 2013 2014 2015 2016 H1 2016 2017 2017 2017 Significant growth and year on year value creation Page 7
2. Market environment German residential market offers huge potential 8
2.1 German economy – stable growth Positive economic outlook supports the industry Index of manpower demand Immigration balance (000) GDP Germany, yoy change (%) 1.500 250 2,0 1.000 200 1,5 500 150 100 0 1,0 2014 2015 2016 2017* 2018* 2013 2014 2015 2016 Jun 17 2011 2012 2013 2014 2015 Source: Statistisches Bundesamt Source: Bundesanstalt für Arbeit Source: Statistisches Bundesamt Unemployment rate (%) Ifo business climate index Origin of immigration (000), 2015 Other 83 120 7 115 6,5 Europe 433 110 6 105 5,5 Asia 531 100 5 2013 2014 2015 2016 Jun 17 81 2014 2015 2016 Jun 17 2018* Africa 11 Source: ifo institute, 2013 - 2016 December * 2017 Estimates, Gemeinschaftsprognose der führenden Wirtschaftsinstitute America Positive macro backdrop Page 9
2.2 German economy – regional differences Employment growth*, GDP 2016, yoy growth (%) GDP 2016, in € bn Δ 2016 to 2011 (%) at current prices at current prices Germany total 4.6 6.2 3.133 Berlin Berlin NRW 5.2 4.3 Saxony Lower Saxony 264 Lower Saxony 4.9 3.5 Germany total Thuringia 129 Berlin 4.2 Brandenburg 3.3 NRW 118 Saxony 2.7 Germany total Saxony 3.3 Brandenburg 69 NRW Brandenburg 1.6 3.2 Thuringia 61 Mecklenb.-Pom. Mecklenb.-Pom. 0.4 3.1 Saxony-Anhalt 59 Thuringia Lower Saxony -0.7 2.9 Mecklenb.-Pom. 41 Saxony-Anhalt Saxony-Anhalt -1.4 2.6 0 100 200 300 400 500 600 700 -5 0 5 10 % 0 2 4 % Portfolios located in * Number of employed persons strongly growing Source: Statistische Ämter der Länder Source: Arbeitskreis Erwerbstätigenrechnung federal states des Bundes und der Länder ADLER exposed to strong and growing regions Page 10
3. H1 2017 Financial performance Financial metrics improved 11
3.1 Results H1 2017 – highlights H1 2017 H1 2016 Change 00 Euro m (%) Solid operational Gross rental income 131.1 130.8 0.2 performance Net rental income 86.4 83.9 3.0 Earnings from property lettings 62.5 61.0 2.5 Earnings from the sale of properties 11.3 16.5 -31.5* EBIT 87.7 83.8 4.7 FFO I 15.7 12.0 30.8 FFO II 20.1 27.4 - 26.6 *at reporting date, ACCENTRO had additional sales of c. EUR 30 m signed, but rights and obligations had not yet been transferred Net rental income FFO I FFO II € m € m € m 60 30 + 30.8% 200 + 3.0% - 26.6% 25 150 40 20 15.7 86.4 15 100 20.1 7.9 20 43.9 10 9.4 50 5 0 0 0 3M 6M 9M FY 3M 6M 9M FY 3M 6M 9M FY ADLER in line with 2017 guidance Page 12
3.2 Results H1 2017 – highlights (cont´d) H1 FY Change Euro m 00 2017 2016 (%) Investment properties (€ m) 2,505.5 2,442.0 2.6 ADLER with improved financial profile EPRA NAV (€ m) 1,094.4 1,069.9 2.3 Equity ratio (%) 29.0 26.6 2.4 PP LTV (excl. convertibles) (%) 57.8 61.3 -3.5 PP WACD (%) 3.66 3.69 -0.03 PP Equity ratio LTV WACD + 2.4 PP % % % 68.7 68.0 70 40 66.9 5 - 3.5 PP 4.70 - 0.03 PP 29.0 65 26.6 4.5 30 25.3 4,5 61.3 4.15 22.0 3.99 18.9 60 57.8 20 4 3.69 3.66 55 3.5 10 3,5 0 50 3 2013 2014 2015 2016 H1 17 2013 2014 2015 2016 H1 17 2013 2014 2015 2016 H1 17 ADLER in line with 2017 guidance Page 13
3.3 Profit and loss statement H1 Operating results increased Comments Expenses from property lettings reduced due to ongoing insourcing of services. Personnel expenses up due to insourcing of property and facility management activities. Other operating expenses impacted by one- off expenses for advisory services connected to sale of conwert stake, tap of corporte bond and Westgrund squeeze-out. 2016 dividends of conwert participation. Change due to sale of conwert stake. Financial result already shows efforts to reduce interest expenses. But also affected by one-offs amounting to EUR 5.6 million from prepayment penalties and utilisation of reserves resultig from conwert participation. Of which EUR 3.6 m current tax expense and EUR 13.7 m deferred taxes Insourcing impacts structure of expenses Page 14
3.4 Balance sheet as of June 30, 2017 Reflecting the company´s successful activities of financial consolidation Comments Investment properties increased due to acquisition of portfolios comprising 893 units and value adjustments. Inventories up with acquisition of 336 units for privatisation by ACCENTRO. At the same time 327 units were sold in H1. Cash position surpasses working capital needs. To be used for future acquisitions. Non-current assets held for sale strongly reduced after sale of conwert shares to Vonovia. Equity increased increased after conversion of 2013/2017 convertible, equity ratio rose by 2.4 PP to 29.0 percent. Financial liabilities declined following redemption of liabilities, particular strong decrease in current liabilities. Balance sheet strengthening through redemption of liabilities Page 15
Recommend
More recommend
