Earnings Release • May 15, 2009
Earnings Release
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Corporate | 15 May 2009 07:23
Fair Value REIT-AG publishes figures for Q1 2009
Fair Value REIT-AG / Quarter Results
Release of a Corporate News, transmitted by DGAP - a company of EquityStory
AG.
The issuer / publisher is solely responsible for the content of this announcement.
Munich, May 15, 2009 - Fair Value REIT-AG today announced its results for
the first quarter of 2009. Its operating business enjoyed on-track results.
New rentals in the first quarter of 2009 took the occupancy level to 95.2%
of Fair Value's share of the potential rent. At the same time, the rental
agreements which expired in the first quarter of the fiscal year were more
than compensated for on balance by renewals and relettings.
In total, the company recorded a net rental result of EUR 1.8 million in
the first quarter of 2009, compared to EUR 2.8 million in Q1 2008. This
downturn is due to lower revenues of EUR 0.5 million at a subsidiary after
a general rental agreement was terminated ahead of time against a
compensation payment. Further the property-related operating expenses were
up by EUR 0.5 million year-on-year as a result of the increased maintenance
and energy costs as well as deferred operating costs. After including the
general administrative costs, other operating income and expenses and the
valuation result, EBIT in the first quarter of the current fiscal year
totaled EUR 1.3 million (previous year: EUR 1.9 million).
In addition, Fair Value REIT-AG also generated income from its
participations in a current total of eight closed-end real estate funds
(associated companies), which are disclosed as income from participations.
During the period under review, Fair Value recorded corresponding income of
EUR 0.5 million (previous year: EUR 0.4 million). This includes expenses
from the valuation of interest rate hedges (interest rate swaps) and
imputed valuation losses from the scheduled reduction of 'over-rents'.
Compared with the previous year's figure of EUR 1.7 million, the net
interest expenses were significantly reduced to EUR 1.1 million. In total,
the financial result in the first three months of the current fiscal year
was EUR -1.3 million compared to EUR -1.9 million in the previous year.
Fair Value REIT-AG thus recorded consolidated net income of EUR 0.4 million
in the first quarter of 2009 (previous year: EUR 0.3 million). This
corresponds to earnings per share of EUR 0.05 (previous year: EUR 0.04).
In the first quarter, earnings were depressed by market valuations of the
interest rate swaps and of the properties, resulting during the year from
the imputed reductions of over-rents. As of March 31, 2009, these market
valuations resulted in total charges of EUR 0.9 million. After adjustment
for these extraordinary factors, the company recorded consolidated earnings
totaling EUR 1.3 million, thus being able to slightly exceed its own
forecast.
During the first three months of the current fiscal year, Fair Value
REIT-AG recorded a cash flow from operating activities (so-called funds
from operations or FFO) of EUR 0.3 million (previous year: EUR 0.6 million)
or EUR 0.03 per share (previous year: EUR 0.07). This downturn was due to
the premature termination of a general rental agreement at a subsidiary
against a compensation payment, as mentioned above. As of March 31, 2009,
cash and cash equivalents totaled EUR 10.4 million, up significantly
compared to the previous year's figure of EUR 5.2 million. As a result,
Fair Value REIT-AG has a high degree of financial flexibility.
The company's equity on March 31, 2009, totaled EUR 75.8 million (December
31, 2008: EUR 76.8 million). Including minority interests, this corresponds
to an equity ratio within the meaning of Section 15 of the REITG of 51.5%
of immoveable assets. As a result, the net asset value of EUR 8.05 per
share in circulation has remained mostly stable (December 31, 2008: EUR
8.16). The slight downturn was due to the changes in the reserves for
changes in value for interest rate swaps.
After the balance sheet date, Fair Value REIT-AG was able to extend current
financing which was set to expire in August 2009 by a period of two years.
In this connection, the loan of EUR 13.5 million will be redeemed by an
amount of EUR 6 million from cash and cash equivalents and from financial
assets.
Frank Schaich, the company's CEO, highlighted the positive growth in Fair
Value REIT-AG's operating business: 'During the first quarter, we
successfully processed a good third of the rental agreements which were due
for renewal or reletting in 2009.' The Managing Board also believes that
the company's financing is well positioned, as the successful follow-on
financing has already taken care of the tasks to be completed this year.
'We have increased our income base in a difficult environment and further
improved our financing structure,' commented Frank Schaich, summarizing the
first three months.
The Managing Board has confirmed its forecast for 2009 as a whole as a
result of the course of business in the first quarter. This forecast is for
Fair Value REIT-AG to record consolidated earnings (IFRS) of EUR 4.2
million to EUR 4.5 million prior to the consideration of changes in the
market value of real estate and interest rate swaps.
The interim report for the first quarter of 2009 is available in the
Investor Relations section of www.fvreit.de.
Company profile
Munich-based Fair Value REIT-AG focuses on the acquisition, leasing,
property management and sale of commercial properties in Germany. Its
investment activities focus primarily on offices, logistics and retail
properties in German regional centers. As a REIT-AG, Fair Value is not
subject to corporation or trade tax and benefits from the exit tax
privilege when purchasing properties. Fair Value's USP is that - in
addition to investing directly in real estate - it also acquires interests
in closed-end real estate funds.
In it's 'Participations' segment Fair Value currently holds interests in a
highly diversified portfolio of 48 properties with a total rental area of
413,650 m² and a market value of around EUR 499 million as of December 31,
2008 (Fair Value's interest in this portfolio currently totals around EUR
197.2 million).
In its 'Direct Investments' segment, Fair Value owns a portfolio of 32
commercial properties in Schleswig-Holstein. These have a rental area of
more than 42,948 m² and are mostly used as bank branches. These properties
had a total market value of around EUR 47.3 million as of December 31,
2008.
On December 31, 2008, Fair Value's share of the entire portfolio had a
market value of around EUR 245 million. As of March 31, 2009, this
proportionate portfolio had an occupancy level of 95.2% of the potential
rent of EUR 21.0 million. The rental agreements had a weighted remaining
term of 6.7 years on March 31, 2009. Around 45% of the potential rent stem
from retail facilities, 40% from offices, 9% are from logistics facilities
and 6% from other facilities.
Contact
Investor & Media Relations
cometis AG
Dirk Stauer
Phone: +49(0)611 - 205855-22
Fax: +49(0)611 - 205855-66
E-mail: [email protected]
Language: English
Issuer: Fair Value REIT-AG
Leopoldstraße 244
80807 München
Deutschland
Phone: +49 (0)89 9292 815-01
Fax: +49 (0)89 9292 815-15
E-mail: [email protected]
Internet: www.fair-value-reit.de
ISIN: DE000A0MW975
WKN: A0MW97
Indices: RX REIT All Share Index, RX REIT Index
Listed: Regulierter Markt in Frankfurt (Prime Standard); Freiverkehr
in Stuttgart, München
End of News DGAP News-Service
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