Vienna (pta/26.05.2023/08:00 UTC+2)
The listed real estate investment company S IMMO AG significantly improved its operating result in the first quarter of 2023. Herwig Teufelsdorfer, member of S IMMO AG's Management Board, comments on the company's latest figures: "S IMMO's operational strength is once again affirmed by the fact that gross profit came in roughly 35% above the prior-year figure at EUR 40.3m, total revenues increased substantially, and EBITDA was also higher."
Significant improvement in operating result
Total revenues increased significantly from EUR 57.0m in the prior-year period to EUR 80.0m. This improvement is mainly due to acquisitions of rented properties in CEE, which made the most significant contribution to the increase in rental income to EUR 47.6m (Q1 2022: EUR 35.8m).
Due to substantially higher revenues from hotel operations, which amounted to EUR 13.4m in the first quarter of 2023 (Q1 2022: EUR 9.2m), the result from hotel operations doubled to EUR 2.5m (Q1 2022: EUR 1.3m). As a result, gross profit advanced considerably from EUR 29.8m to EUR 40.3m.
EBITDA growth and development of net result for the period
The improvement in the operational performance is also reflected in EBITDA, which rose from EUR 23.5m to EUR 31.4m in the first quarter. The result from property valuation, which is mainly attributable to sales-related revaluations in value in Germany, amounted to EUR -10.0m (Q1 2022: EUR -0.7m). EBIT totalled EUR 19.0m (Q1 2022: EUR 20.4m) due to the solid operating result despite the negative property valuations.
The financial result deteriorated year-on-year to EUR -13.2m (Q1 2022: EUR 1.7m), mainly due to non-cash remeasurement effects. Overall, the net result for the period came to EUR -1.2m (Q1 2022: EUR 24.1m) and is the result of significantly improved operating earnings offset by negative non-cash effects on the financial result and on deferred taxes. Earnings per share attributable to shareholders in the parent company amounted to EUR 0.01 (Q1 2022: EUR 0.34).
Global capital markets continue to reflect uncertainty about the economy and interest rates. The S IMMO share closed the first quarter at a price of EUR 13.28. The year-to-date performance was 6.41%, which is above that of the ATX and IATX.
Purchases and strategy
S IMMO AG continued the strategy of disposing of low-yielding properties in Germany in the first quarter of this year. By 31 March 2023, sales contracts had been signed for 153 properties in Germany worth a total of roughly EUR 570m. The liquidity generated from the sales in Germany is to be reinvested in higher-yielding office properties in order to safeguard the profitability of the portfolio in the long term. In February 2023, a letter of intent was signed for the acquisition of office buildings in the Wienerberg area of Vienna, which, when fully implemented, will comprise six properties with combined space of around 128,000 m² as well as a development project encompassing roughly 20,000 m², all with a combined volume of approximately EUR 411m. In April 2023, three office buildings and a hotel were purchased in Czechia. The total value of the acquired portfolio, which will generate an additional annual income of about EUR 8.4m, came to EUR 167.7m.
Outlook for 2023
S IMMO continues to focus on its core business of purchasing, letting and managing high-yielding properties and is pursuing divestment efforts in Germany so as to reinvest the proceeds in more profitable properties. In addition, the joint process to review further alignment, coordination, the merger or other forms of integration will continue under the framework agreement signed with IMMOFINANZ AG in January 2023. The ultimate objective is to identify synergies and efficiency gains that will improve transparency and profitability for all shareholders.
Consolidated income statement for the period 01 January 2023 – 31 March 2023
in EUR millions / fair value method
|thereof rental income||47.6||35.8|
|thereof revenues from operating costs||19.1||12.0|
|thereof revenues from hotel operations||13.4||9.2|
|Other operating income||0.7||0.5|
|Expenses directly attributable to properties||-29.5||-19.7|
|Hotel operating expenses||-10.8||-8.0|
|Income from property disposals||424.6||0|
|Book value of disposed properties||-424.6||0|
|Gains or losses on property disposals||0||0|
|Depreciation and amortisation||-2.4||-2.4|
|Results on property valuation||-10.0||-0.7|
|Operating result (EBIT)||19.0||20.4|
|Net income before tax (EBT)||5.8||22.1|
|Taxes on income||-7.0||2.0|
|Net income for the period||-1.2||24.1|
|thereof attributable to shareholders in parent company||0.4||24.04|
|thereof attributable to non-controlling interests||-1.6||0.05|
|Earnings per share (in EUR)||0.01||0.34|