DGAP-News: TLG IMMOBILIEN AG / Key word(s): Half Year Results/Real Estate
- Funds from operations have increased by 21.4% compared to the first half of 2016, reaching EUR 46.5 m in the first half of 2017
- Rental income has grown by 16.1% compared to the previous year, reaching EUR 78.5 m
- EPRA Net Asset Value increased to EUR 18.95 per share as at 30 June 2017
- Successful refinancing measures are having a positive effect on FFO in 2017
- The office property 'astropark' in Frankfurt/Main has been purchased for around EUR 97.2 m
- The takeover offer to the shareholders of WCM AG was published in June 2017
- The FFO forecast for the 2017 financial year has been revised upwards to between EUR 90 m and EUR 92 m
As at the reporting date, the EPRA Vacancy Rate of the portfolio has fallen significantly by 0.9 pp to just 2.9% (31/12/2016: 3.8%). Compared to the start of the year, the weighted average lease term (WALT) of the rental agreements remained unchanged at 6.1 years as at 30 June 2017. The EPRA Net Asset Value (EPRA NAV) increased by 12.6% to around EUR 1.4 bn in the first half of the year, reaching EUR 18.95 per share as at the reporting date (31/12/2016: EUR 18.51 per share) in spite of the payment of a dividend of EUR 0.80 per share at the end of May 2017.
As at the reporting date, the financing structure of TLG IMMOBILIEN AG was still based on a conservative Net LTV of 38.7% (31/12/2016: 43.4%). The company's average costs of borrowed capital recognised in profit or loss were 2.16%. As at 30 June 2017, the existing loans of the company had an average remaining term of 6.1 years. Extensive refinancing measures were initiated in the first half of 2017 and all financing agreements have now been concluded. The new finance totalling around EUR 292 m has been obtained at an average interest rate of 1.6% and has an average remaining term of 8.6 years. This is expected to lead to a significant reduction in interest expenses that will have a positive effect on the FFO of the company even in the current financial year.
In the first half of 2017, the number of properties in the portfolio of TLG IMMOBILIEN AG decreased by 18 to 386 properties in total (31/12/2016: 404 properties). In contrast, the value of the portfolio increased by 2.7% and is now around EUR 2.3 bn. In the second quarter, the company acquired a locally established special retail centre in Thuringia. A total of EUR 13.3 m was invested, which corresponds to an annual in-place rental yield of 6.5%. The property is fully occupied under a rental agreement with a term in excess of 10 years, and the main tenant is the supermarket chain Kaufland. TLG IMMOBILIEN AG also acquired the office property 'astropark' in Frankfurt/Main after the reporting date. A total of EUR 97.2 m was invested in this transaction. The in-place rental yield is 5.5% per annum. The property has an EPRA Occupancy Rate of 78.1%.
Furthermore, in May 2017 the company announced the submission of a public takeover offer for the shares of WCM AG. The offer document was published on 27 June 2017. According to the last notification dated 8 August 2017, the proportion of shares already swapped is currently 28.4%. The transaction is expected to be closed in October 2017. More information on the transaction is available here.
'We are still on the best possible course for growth', comments Peter Finkbeiner, member of the Management Board of TLG IMMOBILIEN AG, on the current course of the company, adding: 'We are currently demonstrating that we want and are able to grow through more than just property and portfolio acquisitions, and are enjoying the confidence of investors in our ability to take the lead in the German commercial property market by taking over WCM AG. At the same time, we will continue to optimise the key performance indicators of our portfolio successfully.'
In light of the successful property acquisitions and other savings, including as a result of the refinancing measures, the Management Board of TLG IMMOBILIEN AG has revised the FFO forecast for the 2017 financial year upwards to between EUR 90 m and EUR 92 m.
KEY GROUP FIGURES ACCORDING TO IFRS
1 Total number of shares as at 30 June 2016: 67.4 m; as at 30 June 2017: 74.2 m. The weighted average number of shares in the first six month 2016 was 67.4 m and 73.1 m in the first six month 2017.
2 Calculation: Net debt divided by property value
3 Pursuant to the values reported in the financial statements in accordance with IAS 40, IAS 2, IAS 16, IFRS 5
4 Net rent for the year excluding utilities is calculated on the basis of the agreed annualised rent as at the reporting date and does not take into account any rent-free periods.
About TLG IMMOBILIEN AG
As at 30 June 2017, the property value amounted to EUR 2.3 bn. As at the same reporting date, the EPRA Net Asset Value per share amounted to EUR 18.95.
This publication contains forward-looking statements based on current views and assumptions of TLG IMMOBILIEN AG's management and made to the best of knowledge. Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that could cause TLG IMMOBILIEN AG's revenues, profitability or the degree to which it performs or achieves its targets, to materially deviate from what is explicitly or implicitly stated or described in this publication. Therefore, persons who obtain possession of this publication should not rely on such forward-looking statements. TLG IMMOBILIEN AG accepts no guarantee or responsibility regarding such forward-looking statements and will not adjust them to future results or developments.