Immofinanz published its results for the 2019 financial year. The clear improvement of 18.1% in rental income and 30.2% in FFO 1 from the standing investment business underscore the profitable growth of the portfolio to approximately €5.1 billion. Net profit rose by 61.9% to €352.1 million and goes hand in hand with a solid financial position: Cash and cash equivalents total €345.1 million. In order to strengthen this very good cash position, an unsecured revolving credit facility of €100 million was concluded at the end of March 2020.
- Rental income +18.1% and results of asset management +19.1%
- Occupancy rate at record 96.8%
- FFO 1 (before tax, incl. S IMMO dividend) +30.2% to €137.4 million, guidance exceeded
- Robust balance sheet: net LTV of 43.0%, liquid funds of €345.1 million at year-end 2019
- New revolving credit facility of €100.0 million creates added financial flexibility
- Net profit rose by 61.9% to €352.1 million in 2019 (2018: €217.5 million)
“The 2019 financial year marks a milestone in our company’s history. The occupancy rate in our properties continued to improve – from an already high level – and set a new record at 96.8%. This is a direct result of our clear brand policy with innovative office and retail solutions. Our net profit rose by more than 60 per cent and, at €352.1 million, reached the highest level recorded in many years. Through profitable property acquisitions and the completion of construction projects, our portfolio grew by nearly €1 billion to €5.1 billion in 2019 – which confirms that Immofinanz has now reached a relevant size as a player in the European real estate sector“, explained Dietmar Reindl, COO of Immofinanz. “All these factors confirm that Immofinanz is well-prepared to deal with the current challenges presented by the corona crisis and the related slowdown in global growth.”
Record occupancy level
The real estate portfolio included 213 properties with a combined carrying amount of approximately €5.1 billion as of 31 December 2019. Most of these properties – 92.7% or €4.7 billion – are standing investments. Acquisitions and completions led to an increase of more than €1.0 billion or 27.7% in the standing investment portfolio during the past year. The occupancy rate reached a record level of 96.8% (31 December 2018: 95.8%). The gross return equalled 6.2% based on IFRS rental income and 6.5% based on invoiced rents.
Outlook
The goal is to distribute 75% of the FFO 1 generated in 2019 by the company to shareholders. The annual general meeting was postponed to 1 October 2020 due to the COVID-19 crisis. The Executive and Supervisory Boards plan to issue a recommendation for the use of profit for the 2019 financial year together with the announcement of results for the first half of the 2020 financial year. The effects of the COVID-19 crisis on the company’s business activities will be monitored continuously up to that time.
“The continuously changing developments make it impossible to estimate the full impact of the pandemic at the present time. However, we are taking all steps possible to minimise the potential negative effects on the group. We have already implemented cost reductions and postponed non-critical investments to later years. And we are in close contact with our tenants to find fair solutions“, indicated Stefan Schönauer, CFO of Immofinanz. “COVID-19 has created real headwinds for the global economy and our markets, but due to our operating performance and our solid liquidity position and financing structure, we are well-positioned for this phase.“
Immofinanz has held 19.5 million shares of S IMMO since September 2018. Following a capital increase by S IMMO in January 2020, this represents an interest of 26.5%. Immofinanz is continuing to hold all options open in connection with this investment, including the resumption of discussions with S IMMO on the combination of the two companies.
