Quarterly Report • Aug 24, 2017
Quarterly Report
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This half-yearly financial report is also available in Dutch.
The half-yearly financial report was translated into English under the responsibility of Xior Student Housing NV. Only the Dutch version of the half-yearly financial report has evidential value. Both versions are available on the Company website (www.xior.be) or from the registered office on request (Xior Student Housing NV, Mechelsesteenweg 34, Box 108, 2018 Antwerp, Belgium).
Alternative performance measures (APMs) are measures used by Xior Student Housing NV to measure and monitor its operational performance. The European Securities and Markets Authority (ESMA) has issued guidelines applying as from 3 July 2016 for the use and explanation of alternative performance measures. The concepts considered by Xior as APMs are contained in Chapter 5.8 of this Half-Yearly Report. The APMs are marked with and are accompanied by a definition, an objective and reconciliation as required under the ESMA guidelines.
The European Public Real Estate Association (EPRA) is an organisation which promotes, helps to develop and represents the European publicly listed real estate sector in order to boost confidence in the sector and increase investment in publicly listed real estate in Europe. For more information about EPRA, visit the website www.epra.com.
| 1 | CONSOLIDATED KEY FIGURES ON 30 JUNE 2017 | ||
|---|---|---|---|
| 2 | INTERIM MANAGEMENT REPORT | ||
| 2.1 | Note with the consolidated results for the first half of 2017 12 | ||
| 2.1.1 | Consolidated balance sheet 14 | ||
| 2.1.2 | Composition of debts 15 | ||
| 2.2 | Data according to the EPRA reference system 15 | ||
| 2.2.1 | EPRA Key Performance Indicators 15 | ||
| 2.3 | Transactions and achievements 18 | ||
| 2.3.1 | Transactions and achievements during the first half of 2017 18 | ||
| 2.3.2 | Transactions and achievements after the first half of 2017 21 | ||
| 2.4 | Forecast for the second half of 2017 22 | ||
| 2.4.1. | Growth prospects for the second half of the financial year 2017 22 | ||
| 2.4.2 | Outlook 23 | ||
| 2.5 | The XIOR share 24 | ||
| 2.5.1 | The share on Euronext Brussels 24 | ||
| 2.5.2 | Shareholders27 | ||
| 3 | RISKS FOR THE REMAINING MONTHS OF 2017 | 29 | |
| 4 | PROPERTY REPORT | 33 | |
| 4.1 | Property market 34 | ||
| 4.2 | Property portfolio 35 | ||
| 4.2.1 | Portfolio summary 35 | ||
| 4.2.2 | Description and diversification of the property portfolio35 | ||
| 4.2.3 | Report by property experts Stadim and Cushman & Wakefield of 30 June 201740 |
| 5 | CONSOLIDATED CONDENSED FINANCIAL STATEMENTS FOR THE FIRST HALF OF 2017 |
43 |
|---|---|---|
| 5.1 | Consolidated condensed income statement 44 | |
| 5.2 | Summary of the comprehensive income 46 | |
| 5.3 | Condensed consolidated balance sheet 47 | |
| 5.4 | Consolidated statement of changes in equity 50 | |
| 5.5 | Consolidated condensed cash flow statement 56 | |
| 5.6 | Notes 57 | |
| 5.6.1 | Financial reporting principles – General 57 | |
| 5.6.2 | Consolidation 58 | |
| 5.7 | Segment information58 | |
| 5.8 | Alternative Performance Measures (APMs)60 | |
| 5.9 | Other notes66 | |
| 5.9.1 | Property result66 | |
| 5.9.2 | Result on the portfolio 68 | |
| 5.9.3 | Financial result 69 | |
| 5.9.4 | Investment property70 | |
| 5.9.5 | Capital 72 | |
| 5.9.6 | Earnings per share 74 | |
| 5.9.7 | Other non-current financial liabilities 74 | |
| 5.9.8 | Financial debts 75 | |
| 5.9.9 | Financial assets and liabilities 76 | |
| 5.9.10 | Transactions with related parties 77 | |
| 5.9.11 | Events after the balance sheet date 78 | |
| 5.9.12 | Scope of consolidation 78 | |
| 5.9.13 | Debt ratio 78 | |
| 5.9.14 | Off-balance sheet rights and obligations 79 | |
| 5.9.15 | Auditor's report 79 | |
| 5.9.16 5.9.17 |
Statement with the half-yearly financial report80 Forward-looking statements80 |
|
TABLE OF CONTENTS
TABLE OF CONTENTS
The first half of 2017 starts on 1 January 2017 and ends on 30 June 2017.
Figures are in thousand EUR.
| Consolidated income statement | 30/06/2017 | 30/06/2016 |
|---|---|---|
| Net rental income | 7,387 | 4,727 |
| Real estate result | 6,896 | 4,413 |
| Operating result before result on the portfolio | 4,186 | 2,184 |
| Financial result (excl. variations in the fair value of financial assets and liabilities) |
-1,323 | -603 |
| EPRA earnings | 2,537 | 1,288 |
| EPRA earnings after IFRIC 21 adjustment | 2,882 | 1,592 |
| Result on the portfolio (IAS 40) | 2,070 | 1,912 |
| Revaluation of financial instruments (ineffective interest rate hedges) |
1,216 | -2,173 |
| Net result (IFRS) | 5,770 | 1,018 |
1 The definition of EPRA earnings has been changed as from 30 June 2017. Reference is made to Chapter 5.8 of this Half-Yearly Report for the change in definition/calculation and the reasoning behind.
| Number of lettable student units | 30/06/2017 | 30/06/2016 |
|---|---|---|
| Student units | 2,626 | 1,535 |
Figures are in thousand EUR.
| Consolidated balance sheet | 30/06/2017 | 31/12/2016 |
|---|---|---|
| Equity | 218,076 | 131,630 |
| Fair Value of investment property3 | 356,560 | 265,873 |
| Debt ratio (Law on Regulated Real Estate Companies)4 | 39.17% | 50.69% |
Figures are in EUR.
| Key figures per share | 30/06/2017 | 30/06/2016 |
|---|---|---|
| Number of shares | 8,128,249 | 4,857,437 |
| Weighted average number of shares5 | 5,553,555 | 4,781,396 |
| EPRA earnings per share (based on the weighted average number of shares) |
0,46 | 0,27 |
| Result on the portfolio per share (IAS 40) (based on the weighted average number of shares) |
0,37 | 0,39 |
| Revaluation of financial assets and liabilities per share (based on the weighted average number of shares) |
0.22 | -0.45 |
| Net result per share (IFRS) (based on the weighted average number of shares) |
1.04 | 0.21 |
| Closing price of the share | 36.5 | 34.65 |
| Net asset value per share (IFRS) (based on the number of outstanding shares) |
26.83 | 23.71 |
In accordance with the guidelines issued by the European Securities and Market Authority (ESMA) on 3 July 2016, the Alternative Performance Measures (APMs) used by Xior will be included in this Half-Yearly Report. The definitions of the APMs, the reconciliation tables and the goal are included in Chapter 5.8 of this Half-Yearly Report. The website will include a separate Glossary of these APMs for future reference. The APMs are marked with .
4 Calculated in accordance with the Royal Decree of 13 July 2014 pursuant to the Law of 12 May 2014 on Regulated Real Estate Companies.
5 Shares are counted from the time of issue.
3 The Fair Value of the investment property is the investment value as determined by an independent property expert less the transaction costs (cf. BE-REIT Association press release dated 10 November 2016). The Fair Value corresponds to the carrying amount under IFRS.
The net rental income is KEUR 7,387 in the first half of 2017, compared to KEUR 4,727 in the first half of 2016. This is a 56% increase. The net rental income will continue to increase in 2017, as certain acquisitions are planned for the second half of 2017. There are also a number of properties under construction or being refurbished that will only contribute to rental income from October 2017.
This mainly relates to the following properties:
There is also the hostel, which generates rental income during the entire year. The rental income is expected to increase in the following quarters due to seasonal activity.
The average occupancy rate of the property portfolio was 98% for the first half of 2017, compared to 97.4% for the first half of 2016.
The real estate result is KEUR 6,896 on 30 June 2017 (KEUR 4,413 on 30 June 2016) and the operational real estate result is KEUR 5,156 (KEUR 3,228 on 30 June 2016). The property charges (KEUR 1,740) mainly include costs related to maintenance and repair, insurance, property management, valuation expert expenses and other property charges, i.e. property tax and taxes on Dutch real estate that cannot be passed on to the tenants.
As a result of the application of the 'IFRIC 21 Levies' accounting regulations (implemented as from the financial year of 2015), the figures dated 30 June 2017 include a provision for the entire year of 2017 with regard to property tax on real estate, taxes on Dutch real estate, taxes on secondary residencies and the so-called 'subscription tax' ('abonnementstaks'). This has a substantial negative impact on the result for the first half of 2017, as these costs are not spread across all quarters but were entirely booked against the first quarter. The effect of this entry will reduce as the financial year unfolds. If these costs were to be spread and one quarter of the costs would be charged during each quarter, the result of the first half of 2017 would increase by KEUR 345. In this hypothesis, the EPRA earnings would be KEUR 2,882.
The general expenses are KEUR 1,022 and are in line with the general expenses of the previous year (KEUR 1,044 on 30 June 2016). Despite the significant portfolio increase, Xior has managed to keep the general expenses (overheads) under control and manages to achieve economies of scale.
Pursuant to Article 6 of the Law on Regulated Real Estate Companies, Stubis, a wholly owned subsidiary of Xior Student Housing NV, provides limited real estate services to third parties. The fee received for investment property owned by third parties is KEUR 52.
The result on the portfolio for the first half of the year is KEUR 2,070 (KEUR 1,912 on 30 June 2016). New properties were acquired in the first half of 2017 through property acquisitions (sale-purchase c.q. contribution) and share acquisitions.
The property was acquired at the fiduciary value (the purchase price agreed between the parties), which was different from the Fair Value.
The variation in Fair Value between 1 January 2017 and 30 June 2017 was entered under negative or positive variations in investment property. There was a positive net investment property change (KEUR 810).
The financial result is KEUR -107 (KEUR -2,776 on 30 June 2016). This result mainly contains interests on loans (KEUR 944), IRS costs (KEUR 329), bank charges and other commissions (KEUR 29). The increased property portfolio resulted in an increase in the net interest charges. These charges are partly offset by an increase in the market value of the hedging instruments (KEUR +1,216). The market value of these hedging instruments is entered directly in the income statement. The average financing cost is 1.86% for the first half of 2017 (2.24% on 30 June 2016).
The result before taxes is KEUR 6,148. The taxes are KEUR 378. These are mainly taxes on the result of the permanent establishment in the Netherlands.
The net result is KEUR 5,770 (KEUR 1,018 on 30 June 2016) and reflects the EPRA earnings as well as the positive impact of the Fair Value of the property portfolio of KEUR 2,070, the positive impact of the fair value of financial assets and liabilities of KEUR 1,216 and the positive impact of the deferred taxes on IAS 40 corrections of KEUR 52 on 30 June 2017.
The EPRA earnings are KEUR 2,537 (KEUR 1,288 on 30 June 2016). The calculation of the EPRA earnings per share is based on the weighted average number of shares (in function of the dividend entitlements of the relevant shares) on 30 June 2017, which was 5,553,555. The EPRA earnings per share (based on the weighted average number of shares) were EUR 0.46 on 30 June 2017 (EUR 0.27 on 30 June 2016). The EPRA earnings per share after IFRIC 21 adjustment are EUR 0.52 on 30 June 2017 (EUR 0.33 on 30 June 2016).
On 30 June 2017, the portfolio consisted of 2,626 lettable student units. This resulted in a valuation of the property portfolio of KEUR 356,560 on 30 June 2017, which meant a 34% increase of KEUR 90,687 since 31 December 2016 (KEUR 265,873). This increase was mainly due to the acquisition of the student property located at Barbarasteeg in Delft, the contribution of two properties under construction in Brussels (KVS project), the acquisition of an office building to be converted in Amstelveen, the acquisition of an office building to be converted in The Hague (Burgwal project) and an office building to be converted in Rotterdam (Bokelweg project).
For a detailed description of the acquisitions, please refer to Chapter 2.3.1 of this Half-Yearly Report.
If all projects and acquisitions currently in the pipeline are implemented, including the acquisition of the properties in Utrecht and Venlo on 7 July 2017 and the acquisition of an office building to be converted in Delft on 19 July 2017, this figure will rise to approximately EUR 500 million, with more than 4,500 student units.
On 30 June 2017 the portfolio consisted of 61 properties with 3,542 student units, of which 916 units or 26% were still under construction or being converted into student units. The properties under construction will be operational and fully contributing to the rental income from September/October 2017. The properties to be converted into student units will start contributing to the rental income in 2018/2019. These properties are currently generating rental income as offices.
Current assets are KEUR 9,591 and have risen by KEUR 2,360 since 31 December 2016.
They primarily include:
Accruals and deferred payments (KEUR 855) are mainly property costs to be transferred (KEUR 723) and general expenses to be deferred (KEUR 95).
The group equity was KEUR 218,076 on 30 June 2017 (KEUR 131,630 on 31 December 2016). The net asset value per share increased by 7.4% to EUR 26.83 on 30 June 2017 as compared to 31 December 2016.
The long-term obligations remained stable since 31 December 2016. The capital increase of 22 June 2017 resulted in a fall in debt ratio from 50.69% on 31 December 2016 to 39.17% on 30 June 2017, which again leaves sufficient margin for further growth financed with loan capital.
The current liabilities are KEUR 7,371. They fell by KEUR 1,041 since 31 December 2016. The Company follows up outstanding debts very closely in order to keep the Company's debt ratio under control.
Current liabilities consist of exit tax debt (KEUR 2,126), which include the exit taxes payable following the mergers with Karibu Invest, Kwartma and Retail Design. This exit tax must be paid by the end of this year. They also include outstanding debts to suppliers (KEUR 792), advance deposits received from tenants (KEUR 610), VAT, tax and social security debts (KEUR 668), security deposits received from tenants (KEUR 1,605) and accruals and deferred payments (KEUR 1,570). The accruals and deferred payments are mainly rental income to be transferred (KEUR 323), accrued real estate costs (KEUR 885), accrued interests (KEUR 92) and accrued general expenses (KEUR 269).
Xior Student Housing NV had KEUR 137,768 in long-term debt on 30 June 2017. This debt consisted of drawn down long-term credit lines with Belfius Bank, ING Belgium and Argenta Spaarbank. There are no loans that will mature within 12 months. Xior had EUR 225 million in credit lines on 30 June 2017. This amount is made up of credit lines with ING Belgium NV (EUR 78 million), Belfius Bank NV (EUR 52 million), KBC Bank NV (EUR 45 million), BNP Paribas Fortis (EUR 25 million) and Argenta Spaarbank NV (EUR 25 million). The part of the credit lines that has not been drawn down was KEUR 87,000. Part of the loans was paid back as a result of the capital increase of 22 June 2017.
The main covenants the Company must meet with respect to these financing agreements are about compliance with a debt ratio (calculated according to the Royal Decree on Regulated Real Estate Companies) that must always be less than 60%, an interest coverage ratio that must be greater than 2.5 and hedging of at least 70% of financing debt. The ICR stood at 3,16 for H1 2017.
On 30 June 2017, the drawn down credit lines were hedged with interest rate swaps for KEUR 130,000 (94%).
The total market value of the interest rate swaps was negative (KEUR -650), which is KEUR 1,216 more than the market value on 31 December 2016. This value increase has a positive effect on the net result on 30 June 2017.
On 30 June 2017, the average maturity of the outstanding loans was 3.8 years (3.13 years on 31 December 2016). The Company has always concluded financing contracts with a minimum maturity of three years. For a breakdown of debts according to maturity, please refer to Chapter 5.9.8 of this Half-Yearly Report.
These details are not required by the legislation on Regulated Real Estate Companies. The statutory auditor verified whether the EPRA earnings, EPRA net asset value (NAV) and EPRA triple net asset value (NNNAV) ratios were calculated according to the definitions quoted in the EPRA Best Practice Recommendations and whether the financial data used in the calculation of these ratios correspond with the accounting information included in the consolidated financial statements.
6 Financial performance indicator calculated in accordance with the EPRA (European Public Real Estate Association) Best Practice Recommendations. See also www.epra.com.
| Definition | In KEUR | EUR per share |
|
|---|---|---|---|
| EPRA earnings | Underlying result derived from the strategic operating activities. |
2,537 | 0.46 |
| EPRA NAV | Net asset value (NAV) adjusted to take into account the fair value of the real estate property and excluding certain elements that are not part of a financial model of long-term property investments. |
218,726 | 26.91 |
| EPRA triple net asset value (NNNAV) |
EPRA net asset value (NAV) adjusted to take into account (i) the Fair Value of the assets and liabilities, (ii) the fair value of debts and (iii) the deferred tax. |
218,076 | 26.83 |
| % | |||
| EPRA cost ratio (incl. vacancy costs) |
EPRA costs (including vacancy costs) divided by the gross rental income. |
37.5%7 | |
| EPRA cost ratio (excl. vacancy costs) |
EPRA costs (excluding vacancy costs) divided by the gross rental income. |
37.2%8 |
| EPRA earnings per share | 30/06/2017 | 30/06/2016 |
|---|---|---|
| Net result | 5,770 | 1,018 |
| Variations in the fair value of investment property | -810 | -1,964 |
| Other result on the portfolio | -1,260 | 52 |
| Result from the sale of investment property | 0 | 0 |
| Variations in the fair value of financial assets and liabilities | -1,216 | 2,173 |
| Deferred taxes on IAS 40 corrections | 52 | 8 |
| Weighted average number of shares | 5,553,555 | 4,781,396 |
| EPRA earnings per share | 0.46 | 0.27 |
| IFRIC 21 impact | 345 | 305 |
| EPRA earnings per share after IFRIC 21 adjustment | 0.52 | 0.33 |
7 The EPRA cost ratio (including vacancy costs) after IFRIC 21 adjustment is 32.8%.
8 EPRA cost ratio (excluding vacancy costs) after IFRIC 21 adjustment is 32.5%.
| EPRA NAV | 30/06/2017 | 31/12/2016 |
|---|---|---|
| Net asset value according to the financial statement | 218,076 | 131,630 |
| To be excluded: | ||
| Fair value of permitted hedging transactions | 650 | 1,866 |
| EPRA NAV | 218,726 | 133,496 |
| EPRA NAV (EUR/share) | 26.91 | 25.33 |
| EPRA triple net asset value (NNNAV) | 30/06/2017 | 31/12/2016 |
|---|---|---|
| EPRA NAV | 218,726 | 133,496 |
| To be added: | ||
| Fair Value of permitted hedging transactions | -650 | -1,866 |
| EPRA NAV | 218,076 | 131,630 |
| EPRA NAV (EUR/share) | 26.83 | 24.97 |
| EPRA cost ratio | 30/06/2017 | 30/06/2016 |
|---|---|---|
| General expenses | 1,022 | 1,044 |
| Impairment of trade receivables | 9 | 0 |
| Property charges | 1,740 | 1,186 |
| EPRA costs (incl. vacancy costs) | 2,771 | 2,230 |
| Vacancy costs | 19 | 0 |
| EPRA costs (excl. vacancy costs) | 2,751 | 2,230 |
| Gross rental income | 7,396 | 4,727 |
| EPRA cost ratio (incl. vacancy costs) | 37.5% | 47.2% |
| EPRA cost ratio (excl. vacancy costs) | 37.2% | 47.2% |
| IFRIC 21 impact | 345 | 305 |
| EPRA cost ratio (incl. vacancy costs) after IFRIC 21 adjustment | 32.8% | 40.7% |
| EPRA cost ratio (excl. vacancy costs) after IFRIC 21 adjustment | 32.5% | 40.7% |
After its first year as a regulated real estate company listed on the stock market, Xior continued to work on the further growth of its portfolio in the first half of 2017. During the implementation of its growth strategy, Xior strives towards a balanced growth of both equity and loan capital with a healthy combination of various financing sources, whilst keeping the debt ratio under control and increasing the earnings per share. Xior achieved a contribution in kind in January 2017 and successfully completed a capital increase of approximately EUR 84 million on 22 June 2017. If all acquisitions and redevelopment projects currently in the pipeline are implemented, the portfolio figure will rise to approximately EUR 500 million, with more than 4,500 units.
As always, the Board of Directors and management also focused continuously on the operational and financial management.
On 31 May 2017, Xior acquired two office complexes to be converted on Heer Bokelweg in Rotterdam and on Lutherse Burgwal in The Hague. This transaction has an expected initial return of approximately 7% after reconversion and will result in about 500 extra units with a total investment value of approximately EUR 67.4 million after reconversion once the permit has been obtained and the planned redevelopment has been completed. The Company expects both buildings to be operational from September 2019. Part of the buildings in Rotterdam and The Hague will continue to be rented for some time to come, which will already generate a total income of around EUR 2.11 million on an annual basis from the acquisition date. Xior acquired the property in question on the site by first buying 55% of the shares in the relevant real estate companies (Bokelweg B.V and Burgwal B.V.) and then by purchasing the other 45% of the shares in both real estate companies by exercising the call option it had been granted on 30 June 2017.
The property in Rotterdam is located on Heer Bokelweg, 200 m from the central station in the centre of this student city. The Company plans to develop about 350 units in this property as the perfect complement to the 280 units in
9 The investment values are in line with the estimates of the independent property expert.
the development project located on the Woudestein Campus (Erasmus University Rotterdam). Completion is planned in September 2019.
The property in The Hague is located on Lutherse Burgwal, which is situated at the interconnection between the Company's existing properties on Eisenhowerlaan and Waldorpstraat. Xior plans to develop 182 units on this property, which will increase the total number of units in this student city to 450.
On 6 April 2017 Xior acquired a development project consisting of an office complex10, which the Company intends to convert after having obtained the necessary permits. Xior acquired these properties by buying 100% of the shares in the relevant real estate company Amstelveen Keesomlaan 6-10 B.V. After the proposed redevelopment of the complex, the property will provide approximately 300 student units with a total investment value of approximately EUR 30 million. Part of the office complex will continue to be rented for some time to come, which will generate around KEUR 350 in income from the acquisition date. The complex is situated next to the Uilenstede student campus, has direct public transport connections to the centre of Amsterdam and is within cycling distance of Vrije Universiteit Amsterdam.
Xior acquired a student complex (under construction)11 consisting of two buildings opposite each other on Ladderstraat in Brussels (KVS project). The land and structures already erected at the time were entered by means of a contribution in kind to Xior's capital on 17 January 2017. The value of the contribution was determined based on the value of the land and the structures (already completed at the time) and has resulted in a capital increase of EUR 5,064,067 (incl. issue premium). This acquisition has a total investment value of approximately EUR 8.1 million (once the works have been completed). The units are expected to be operational in September 2017.
On 5 January 2017, Xior acquired a student property12 consisting of 108 brand-new, independent, furnished student units in one of the fastest-growing student cities in the Netherlands. This acquisition has a total investment value of approximately EUR 13.5 million. The property is situated in a premium location in the centre of Delft, near the station and close to Delft University of Technology.
In the first half of 2017, the Company secured additional financing from BNP Paribas Fortis, KBC Bank NV and Argenta Spaarbank NV. It took out a EUR 25 million credit line with each bank.
The Annual General Meeting of Xior Student Housing NV took place on 18 May 2017. The annual financial statements for 2016 were approved at the Annual General Meeting. The Annual General Meeting also approved the payment of EUR 1.15 gross or EUR 0.805 net in a dividend13 per share.
In the first half of 2017 and in 2016, Xior also concluded various agreements under certain conditions for the acquisition of various strategic student complexes which confirmed Xior's planned growth strategy.
• A joint venture (in cooperation with a private developer) for a development project in Etterbeek, Belgium to create 115 units for EUR 6.3 million. The total investment value (after reconversion) will be approximately EUR 11.7 million (assuming that 100% ownership of the real estate company is obtained) and the project has an expected initial return of approximately 6%. Once planning permission has been obtained, the existing property on Oudergemlaan in Etterbeek will be converted into a complex of 115 independent studios and six parking spaces based on a design by architectural firm Jaspers-Eyers. This student property is expected to be operational in the academic year starting in September 2018. The Company was granted a one-year rental guarantee for 50% of the rental income.
Xior continues to develop its management structure and operational teams who are responsible for the day-to-day management of the properties and rental of the student rooms. The rental activities for the following academic year are in full swing, supported by commercial initiatives such as an update of the website that makes it even easier for students to find their ideal student rooms, an expansion of the features of the Xior app (the very first app specifically aimed at finding student rooms) and the 'Golden Ticket' campaign that offered students a chance to win free digs for one year and a wide range of fun Xior gadgets.
The Company pursues a policy that hedges a substantial part of the interest rate risk with regard to its long-term financing up to at least 70%, either with a fixed interest rate for the entire agreement term or with hedging instruments such as interest rate swaps and forward rate agreements. 94% of outstanding loans were hedged with interest rate swap contracts on 30 June 2017. The Company's hedging policy will be regularly evaluated and adjusted when necessary (for example with regard to the instrument types, hedging period, etc.).
Xior Student Housing renegotiated its interest rate swap contracts in 2016 and 2017.
We also refer to Chapter 5.9.7 of this Half-Yearly Report for the valuation of these hedging instruments on 30 June 2017.
On 19 July 2017, Xior acquired an office property for redevelopment from the local council of Delft located at Phoenixstraat 16, Delft in order to develop around 100 units with a total investment value (after conversion) of approximately EUR 8.6 million. This postmodernist building was designed by the well-known architect Jo Coenen and is characterised by the atrium structure of the circular 'drum' running all the way down to the ground floor. This property is situated in a premium location in Delft at only a stone's throw from the student property on Barbarasteeg near Delft station in an area currently undergoing extensive redevelopment. The Company expects an initial return of 6.5% once planning permission has been obtained and the planned redevelopment has been completed. The Company expects this building to be operational from September 2019.
On 7 July 2017, Xior acquired the shares in three real estate companies (Utrecht Willem Dreeslaan B.V., De Keulse Poort B.V. and The Safe B.V.), which own one recently renovated property in Utrecht and two properties in Venlo respectively. The total conventional value of the underlying real estate is approximately EUR 27.5 million and the total average initial return is approximately 6.8%. The transferor provides a rental guarantee for a period of two years.
The property near various educational institutions in Utrecht is called 'The Hive'. It has 134 non-independent units and therefore complements the Company's independent units in the portfolio mix.
The acquisition in Utrecht also involves a student property called 'The Bank' of 110 independent units in the centre of Venlo near the station. The ground floor is rented out to a financial institution. Xior used the momentum of this purchase to optimise this transaction immediately by acquiring a second rented property in the centre of Venlo called 'The Safe' , which allows Xior to achieve a sufficient presence in this city. This property consists of 56 independent units and a commercial ground floor, also partly rented out to a financial institution.
Xior intends to continue pursuing its growth strategy. This involves promoting the growth of the company by adding highquality student properties to its property portfolio. Xior has made great efforts in this respect in the first half of 2017 in order to achieve this growth.
We also refer to the above-mentioned transactions and achievements of the first half of 2017 (see item 2.3 above) in this context Xior intends to complete the acquisitions planned for the second half of 2017, including those in Delft, The Hague and Rotterdam (see items 2.3.1.4 above).
Barring any unforeseen circumstances, Xior confirms its projected EPRA earnings per share of EUR 1.40 for the financial year 2017 and the associated gross dividend of EUR 1.20 (subject to approval by the shareholders' meeting).
The debt ratio was 39.17% on 30 June 2017 compared to 50.69% on 31 December 2016, which leaves sufficient margin for further growth financed with loans.
The Xior share (ISIN code BE0974288202) has been listed on the regulated Euronext Brussels market since 11 December 2015. Xior is included in the Bell Small index.
The closing price on 30 June 2017 was EUR 36.50, which represents a premium of 36% compared with the net value per share on 30 June 2017 (cf. Royal Decree on Regulated Real Estate Companies), which was EUR 26.83 per share. Xior's market capitalisation on Euronext Brussels rose to approximately EUR 297 million in the first half of 2017.
| 30/06/2017 | 31/12/2016 | 31/12/2015 | |
|---|---|---|---|
| Number of issued shares | 8,128,249 | 5,270,501 | 4,626,780 |
| Weighted average number of shares1 | 5,553,555 | 4,926,405 | 4,626,780 |
| Market capitalisation (in EUR) | 296,640,447 | 187,998,771 | 123,535,026 |
| Free float | 71.64%2 | 71.00% | 75.33% |
| Share price (closing price) for relevant period (in EUR) | |||
| Highest | 37.27 | 36.80 | 26.81 |
| Lowest | 35.13 | 26.76 | 25.75 |
| Average | 36.33 | 33.22 | 26.50 |
| At year-end closing | 36.50 | 35.67 | 26.70 |
| Volume (in number of shares) | |||
| Number of shares traded | 461,011 | 1,246,297 | 313,862 |
| Average daily volume | 3,630 | 4,849 | 22,419 |
| NAV (IFRS) (in EUR) | 26.83 | 24.97 | 23.42 |
| EPRA NAV (in EUR) | 26.91 | 25.33 | 23.42 |
| Dividend payout ratio | N/A | 98.3% | N/A |
| EPRA earnings per share (in EUR) | 0.46 | 1.17 | N/A |
1 Weighted average number of shares taking into account the dividend entitlements for the relevant shares.
2 Approximate estimate taking into account the known percentages of shareholders who issued a transparency notice (based on the current total number of shares (denominator)).
Market: Euronext Brussels Symbol: XIOR ISIN code: BE0974288202 Listing: continuous Liquidity provider: Degroof Petercam
On 30 June 2017, the authorised capital of Xior Student Housing NV was EUR 146,308,482.00, represented by 8,128,249 fully paid-up shares.
The following table illustrates Xior's shareholder structure, based on the information received from the shareholders (cf. the transparency notifications) and/or publicly known information on Aloxe NV.
| # shares | % shares | |
|---|---|---|
| Aloxe NV - Christian Teunissen & Frederik Snauwaert | 1,882,997 | 23.17%1 |
| AXA Investment Managers S.A. | 273,348 | 5.19%2 |
1 The number of shares and percentage are updated based on public information on the capital increase of June 2017 and the denominator on 22 June 2017 (8,128,249).
2 Based on the transparency notice of 21 December 2016 and the denominator on 21 December 2016 (5,270,501).
02 INTERIM MANAGEMENT REPORT
28
The Board of Directors and management of Xior are aware of the specific risks associated with the provision and management of a property portfolio, and try to optimally manage these risks by mitigating or neutralising them as far as possible.
With regard to the main risks and uncertainties for the remaining months of the financial year 2017, we refer to the description of these risks and uncertainties on pages 12 to 26 of the Annual Financial Report 2016 (available on the Company website www.xior.be), which will also remain relevant for the remaining part of 2017.
Student housing is highly fragmented in both Belgium and the Netherlands, with many private landlords renting out student rooms. Students also often live in studios, apartments or houses in the regular housing market. Student accommodation is often expensive or outdated and there is a shortage in most cities. A strong wave of new large student complex developments has eliminated this shortage somewhat, but student numbers continue to grow and there is still a need for more and better accommodation.
This property segment is also characterised by growing consolidation and professionalisation. The recent influx of large new student complexes is a conscious strategy on the part of the cities and educational institutions, in partnership with major developers and institutional investors. The cities are imposing stricter urban planning requirements, primarily designed to allow young families to acquire affordable housing in the city centre again. Students belong in good student rooms or student complexes, and cities are increasingly taking the necessary steps to ensure this.
The student housing sector also has a fragmented regulatory framework with variations of a national (for example Belgium compared to the Netherlands), regional (depending on region to region), and local (depending on municipality to municipality) nature. The regulatory framework is currently evolving. In the three Belgian regions, for example, several initiatives are being taken to review the regionalised rental legislation (albeit at different rates).
Educational institutions also require a high-quality supply of student accommodation, better management and maintenance, and affordable rents. They also tend to enter into public-private partnerships with the professional property sector to increase and improve the supply in their city. The future lies with well-equipped and affordable student accommodation, under good management. There is increasing demand for self-contained rooms and more privacy in both the Netherlands and Belgium.
The number of students in Belgium and the Netherlands is expected to continue to grow over the next few years. This is mainly because of further internationalisation often due to coordinated European or international exchange programmes. The relatively low educational costs, the quality of the education and the courses taught in English (particularly in the Netherlands, which is the front runner in Europe in this respect) attract even more international students. International students need excellent facilities and are increasingly requesting self-contained rooms. It is mostly major student cities and the most popular universities that attract international students.
A summary and description of the Company's property portfolio, including its composition and diversification, is provided below.
| Rental income on 30 June 2017 |
Units – rooms |
Units – other |
Fair Value | |
|---|---|---|---|---|
| Belgium | 4,000 | 1,689 | 49 | 178,608,259 |
| The Netherlands | 2,804 | 937 | 9 | 93,557,686 |
| Under construction – Belgium | 98 | 1 | 9,746,359 | |
| Hostel – Belgium | 328 | - | 50 | 7,692,649 |
| To be reconverted – Netherlands1 | 264 | 832 | 200 | 66,955,283 |
| Total | 7,396 | 3,556 | 309 | 356,560,236 |
1 The mentioned number of room units refers to the planned number of student units after the planning permission and reconversion. The mentioned number of other units refers to the number of current car park spaces.
On 30 June 2017, the Company's property portfolio consisted of 61 properties. Of these, 43 properties are located in Belgium and 18 in the Netherlands. These properties offer a total of 2,626 student rooms and there is retail activity on the ground floor of ten of these buildings. The property portfolio also includes three properties used only for retail activity, a hostel in Ghent with 50 units and a car park in Antwerp and some parking spots in Leuven. Not including the properties that are being renovated/constructed (Bondgenotenlaan 74, Arendstraat 11, KVS project), the total property portfolio occupancy rate on 30 June 2017 was 98%.
Kipdorpvest ANTWERPEN The total Fair Value of the property portfolio on 30 June 2017 was EUR 356,560,236. The Company is a pure player in student housing and has student property as its core activity. The property portfolio is strategically diversified: its student accommodation is a well-balanced mix in terms of geographical diversification and student property types (see different types of student rooms). The large number of different tenants and various room types attract a wide range of different types of student tenants, ensuring a good diversification in terms of tenant types.
The following summary lists the property portfolio by subportfolio, country and city. Every subportfolio shows the Fair Value, rental income and insured value.
The rental income is the annual rent based on the tenancy schedule on 31 December 2016.
| Fair Value | Contract rental income on 31 December 2016 |
Insured value | Acquisition value |
||
|---|---|---|---|---|---|
| BE | Antwerp | 47,516,562 | 2,249,597 | 21,432,855 | 45,845,500 |
| Brussels | 10,253,545 | 122,640 | 5,515,580 | 10,190,000 | |
| Ghent | 65,654,630 | 2,955,452 | 37,689,704 | 54,094,700 | |
| Leuven | 70,727,442 | 2,723,682 | 30,404,638 | 67,584,669 | |
| Mechelen | 1,895,089 | 75,780 | 1,408,700 | 1,894,000 | |
| NL | Amstelveen | 21,068,912 | 350,000 | 27,000,000 | 21,000,000 |
| Breda | 17,032,137 | 992,085 | 10,560,509 | 17,385,443 | |
| Delft | 13,441,718 | 804,060 | 5,561,000 | 13,266,990 | |
| The Hague | 32,691,147 | 1,983,822 | 25,978,696 | 29,287,000 | |
| Eindhoven | 10,475,784 | 652,256 | 5,206,621 | 10,400,000 | |
| Maastricht | 30,118,048 | 1,988,730 | 20,553,243 | 28,296,957 | |
| Rotterdam | 30,145,224 | 1,150,000 | 40,118,240 | 28,266,500 | |
| Tilburg | 5,540,000 | 378,326 | 3,927,083 | 5,441,826 | |
| TOTAL | 356,560,236 | 16,426,430 | 235,356,869 | 332,953,585 |
Xior Student Housing's property portfolio is insured for a total reconstruction value of EUR 235 million, which does not include the land on which the property was built, compared with a Fair Value of EUR 357 million (including the land) on 30 June 2017, i.e. 66% of the Fair Value.
The insurance policies also include additional cover of lost rent if the properties can no longer be used. The lost rent will be paid out for as long as the building has not been reconstructed. Xior Student Housing also has civil liability insurance.
The following graph shows the diversification of rental income for every type of property based on the rental income achieved for the respective properties in the property portfolio on 30 June 2017.
Total rent - Diversification by type
The above summary shows the strong focus on student property, which accounts for 80.7% of rental income. The portfolio also includes of a limited number of retail spaces (10.5% of the rental income), which are mostly situated on the ground floor of properties primarily serving as student accommodation. Four properties are used exclusively for a retail purpose. As the properties typically have an excellent central location in the city, the retail spaces tend to be city shops, pubs and restaurants in a central, concentrated shopping district. The "Other" segment (8.8% of the portfolio) includes the rental income resulting from other activities, such as the hostel in Ghent, the car park in Antwerp, the limited office space at the property in Overwale 42-4416, Ghent and the office space in Amstelveen, Rotterdam (Bokelweg project) and The Hague (Burgwal project), of which the latter three will be converted into student units.
The following graphs show the diversification of the property portfolio by country based on the Fair Value. The centre of activity currently still lies in Belgium (particularly in Flanders), where there are 43 properties with a total Fair Value of EUR 196 million (including EUR 9.7 million under construction), which accounts for 55% of the property portfolio. The other 45% is located in the Netherlands, where there are 18 properties with a Fair Value of EUR 160.5 million, of which EUR 67 million is covered by office properties to be converted. Based on rental income, Belgium accounts for 58.5% of the property portfolio with EUR 4.3 million. The other EUR 3 million, which is 41.5% of rental income, is generated in the Netherlands. The acquisitions of 2017 resulted in a rise in the Fair Value and rental income of the Dutch properties.
The RREC's property portfolio includes 61 properties spread across five cities in Belgium and eight cities in the Netherlands. The properties are located in the main student cities in Flanders, such as Leuven, Ghent and Antwerp, and the main student cities in the Netherlands, such as Breda, The Hague, Tilburg, Maastricht, Eindhoven, Delft, Amstelveen and Rotterdam. The locations of the various properties in Belgium and the Netherlands and their representation in the property portfolio's Fair Value and rental income are provided below:
Fair Value - Diversification by city Rental Income - Diversification by city
0,4%
Ghent
The following tables show the property portfolio top 10 in terms of Fair Value.
Overwale 42-4417 has the highest Fair Value: EUR 43,380,300, which is 11.89% of the property portfolio's total Fair Value. The property consists of 490 units. The top three biggest portfolio properties in terms of Fair Value also include Kipdorpvest 49 and Bokelweg. They represent 9.8% and 8.45% of the property portfolio's total Fair Value, respectively.
We are pleased to present our appraisal of the value of the property portfolio of Xior Student Housing NV (Stadim: 43 properties in Belgium and 8 properties in the Netherlands; Cushman & Wakefield: 10 properties in the Netherlands) on 30 June 2017.
Xior has appointed us, as independent property experts, to determine the investment value and Fair Value of its property portfolio. The appraisals were made taking into account the comments and definitions stated in the reports and the guidelines of the International Valuation Standards issued by the International Valuation Standards Council (IVSC).
IAS 40 defines Fair Value as the amount for which assets would be transferred between two well-informed parties, on a voluntary basis, and without any special interests, mutual or otherwise. IVSC considers these conditions fulfilled if the parties observe the aforementioned definition of market value. The market value must therefore be a reflection of the current tenancy agreements, the current gross margin of self-financing (or cash flow), the reasonable assumptions concerning the potential rental income and of the expected costs.
The notarial charges must be adapted in this context to the factual market situation. After the analysis of a large number of transactions, the property experts who act on the request of listed real estate companies, came to the conclusion in a working group that since property can be transferred in various ways, the impact of the transaction fees on large investment properties in the Belgian market, whose value exceeds EUR 2.5 million, is limited to 2.5%. The value including the transaction fees payable by the purchaser is therefore the Fair Value plus 2.5% in notarial charges. The Fair Value is therefore calculated by dividing the value including the transaction fees by 1.025. Properties valued at less than the EUR 2.5 million threshold and foreign companies fall under the normal registration duty and their Fair Value thus corresponds with the value that includes the transaction fees payable by the purchaser.
We have acted as independent experts. As property experts, we hold a relevant and accredited qualification and have up-to-date experience with properties of a similar type and location to those in Xior's property portfolio.
The appraisal of the properties took both the current tenancy agreements and all rights and obligations arising from these agreements into consideration. Each property was appraised separately. The appraisal does not take account of potential added value that could be achieved by offering the entire portfolio for sale. Our appraisals do not take into account any marketing costs inherent to a transaction, such as estate agent fees or advertising costs. In addition to an annual inspection of the properties concerned, our appraisals are also based on the information supplied by Xior in relation to the tenancy situation, floor areas, drawings or plans, rental charges and taxes in relation to the specific property, conformity and any environmental pollution. The information provided was considered to be accurate and complete. Our appraisals assume that any non-disclosed information is not of such a nature as to influence the value of the property.
Based on the comments above, we can confirm that the Fair Value of the part of Xior's property portfolio appraised by Stadim (43 properties in Belgium and 8 in the Netherlands) on 30 June was EUR 325,310,213 (three hundred and twentyfive million, three hundred and ten thousand and two hundred and thirteen euros).
Based on the comments above, we can confirm that the rounded Fair Value of the part of Xior's property portfolio appraised by Cushman & Wakefield (10 properties in the Netherlands) on 30 June 2017 was EUR 32,070,000 (thirtytwo million, seventy thousand euros). Yours faithfully,
Stadim Cushman & Wakefield"
In KEUR.
| 30/06/2017 | 30/06/2016 | |||
|---|---|---|---|---|
| I. | (+) | Rental income | 7,396 | 4,727 |
| (+) | Rental income | 7,396 | 4,727 | |
| (+/-) | Rental guarantees | 43 | ||
| (+/-) | Rent reductions | -14 | ||
| III. | (+/-) | Rent-related expenses | -9 | |
| Impairment of trade receivables | -9 | |||
| NET RENTAL INCOME | 7,387 | 4,727 | ||
| V. | (+) | Recovery of rental charges and taxes normally payable by the tenants for let properties |
1,191 | 587 |
| Transmission of rental charges borne by the owner | 1,082 | 587 | ||
| Charges for withholding tax and taxes on let properties | 109 | |||
| VII. | (-) | Rental charges and taxes normally payable by the tenants for let properties |
-1.369 | -678 |
| Rental charges borne by the proprietor | -1,216 | -528 | ||
| Advance levies and taxes on let properties | -154 | -150 | ||
| VIII. | (+/-) | Other rent-related income and expenditure | -314 | -223 |
| Property result | 6,896 | 4,413 | ||
| IX. | (-) | Technical costs | -433 | -332 |
| Recurring technical costs | -433 | -332 | ||
| (-) | Maintenance | -387 | -286 | |
| (-) | Insurance premiums | -46 | -46 | |
| Non-recurring technical costs | ||||
| (-) | Damages | |||
| X. | (-) | Commercial costs | -102 | -145 |
| (-) | Publicity | -102 | -145 | |
| XI. | (-) | Costs and taxes for non-let properties | -19 | |
| XII. | (-) | Property management costs | -551 | -224 |
| (-) | Management costs (external) | -253 | -76 | |
| (-) | Management costs (internal) | -297 | -148 | |
| XIII. | (-) | Other property charges | -635 | -484 |
| (-) | Architects' fees | -1 |
| (-) | Valuation expert fees | -65 | -59 | |
|---|---|---|---|---|
| (-) | Other | -568 | -425 | |
| (+/-) | Property charges | -1,740 | -1,186 | |
| Property operating result | 5,156 | 3,228 | ||
| XIV. | (-) | General company expenses | -1,022 | -1,044 |
| XV. | (+/-) | Other operating result and costs | 52 | |
| Operating result before result on the portfolio | 4,186 | 2,184 | ||
| XVI. | (+/-) | Result from the sale of investment property | 0 | 0 |
| (+) | Net property sales (sales price - transaction fees) | 0 | 0 | |
| (-) | Book value of the sold property | 0 | 0 | |
| XVIII. (+/-) | Variations in the Fair Value of investment property | 810 | 1,964 | |
| (+) | Positive variations in the Fair Value of investment property | 1,949 | 2,884 | |
| (-) | Negative variations in the Fair Value of investment property | -1,139 | -921 | |
| XIX. | (+) | Other portfolio result | 1,260 | -52 |
| Operating result | 6,256 | 4,096 | ||
| XX. | (+) | Financial income | 17 | 21 |
| (+) | Interest and dividends collected | 17 | 21 | |
| XXI. | (-) | Net interest costs | -1,323 | -489 |
| (-) | Nominal interest paid on loans | -944 | -301 | |
| (-) | Reconstitution of the nominal amount of financial debt | -39 | -28 | |
| (-) | Costs of permitted hedging instruments Permitted hedging instruments that are not subject to hedging accounting as defined by the IFRS |
-329 | -160 | |
| (-) | Income from permitted hedging instruments | |||
| (-) | Other interest charges | -12 | ||
| XXII. | (-) | Other financial costs | -17 | -136 |
| Bank costs and other commissions | -25 | -138 | ||
| Other | 9 | 3 | ||
| XXIII. | (+/-) | Variations in the fair value of financial assets and liabilities | 1,216 | -2,173 |
| Permitted hedging instruments that are not subject to hedging accounting as defined by the IFRS |
1,216 | -2,173 | ||
| Other | ||||
| (+/-) | Financial result | -107 | -2,776 | |
| Result before taxes | 6,148 | 1,319 | ||
| XXV. | (+/-) | Corporate tax | -374 | -301 |
| XXVI. | (+/-) | Exit tax | -4 | |
| (+/-) | Taxes | -378 | Kipdorpvest -301 |
|
| ANTWERPEN | ||||
| Net result | 5,770 | 1,018 |
Figures are in thousand EUR.
| 30/06/2017 | 30/06/2016 | ||
|---|---|---|---|
| Net result | 5,770 | 1,018 | |
| Other components of the comprehensive income | 0 | 0 | |
| (+/-) | Impact on the fair value of the estimated transaction fees and costs result ing from hypothetical disposal of investment property |
0 | 0 |
| (+/-) | Variations in the effective part of the fair value of permitted cash flow hedging instruments |
0 | 0 |
| Comprehensive result | 5,770 | 1,018 | |
| Attributable to: | |||
| Minority interests | 0 | 0 | |
| Group shareholders | 5,770 | 1,018 |
Figures are in thousand EUR.
| Assets | 30/06/2017 | 31/12/2016 | ||
|---|---|---|---|---|
| Fixed assets | 356,994 | 266,276 | ||
| A | Goodwill | 0 | 0 | |
| B | Intangible fixed assets | 0 | 0 | |
| C | Investment property | 356,560 | 265,873 | |
| a | Property available to let | 342,799 | 265,873 | |
| b | Property developments | 13,761 | ||
| D | Other tangible fixed assets | 278 | 248 | |
| a | Tangible fixed assets for own use | 278 | 248 | |
| Other | ||||
| E | Financial fixed assets | 21 | 21 | |
| Assets held until maturity | ||||
| Other | 21 | 21 | ||
| F | Financial leasing receivables | |||
| G | Trade receivables and other fixed assets | 135 | 135 | |
| H | Deferred taxes – assets | |||
| Current assets | 9,591 | 7,231 | ||
| A | Assets held for sale | |||
| Investment property | ||||
| Real estate certificates | ||||
| c | Other assets | |||
| D | Trade receivables | 385 | 542 | |
| E | Tax receivables and other current assets | 2,559 | 2,051 | |
| a | Taxes | 748 | 172 | |
| Wages and social security contributions | ||||
| c | Other | 1,811 | 1,879 | |
| F | Cash and cash equivalents | 5,792 | 4,098 | |
| G | Accruals and deferred payments | 855 | 540 | |
| Prepaid property charges | 723 | 430 | ||
| Accrued rental income not due | 37 | |||
| Other | 95 | 110 | ||
| Total assets | 366,585 | 273,507 |
| Liabilities | 30/06/2017 | 31/12/2016 | |
|---|---|---|---|
| Equity | 218,076 | 131,630 | |
| I | Equity attributable to parent company shareholders | 218,076 | 131,630 |
| A | Capital | 144,156 | 94,869 |
| a | Issued capital | 146,308 | 94,869 |
| b | Capital increase costs | -2,152 | |
| B | Issue premiums | 69,877 | 32,261 |
| C | Reserves | -1,728 | -515 |
| Statutory reserves | |||
| Reserve for the balance of the variations in the fair value of property |
6,668 | 4,044 | |
| Reserve for the impact on the fair value of the estimated transaction fees and costs resulting from the hypothetical disposal of investment property |
-6,642 | -4,565 | |
| Reserve for the balance of the changes in the fair value of permitted hedging instruments that are not subject to hedging accounting as defined in the IFRS |
-1,866 | ||
| Retained earnings over from previous financial years | 113 | 6 | |
| D | Net result for the financial year | 5,770 | 5,016 |
| II | Minority interests | 0 | 0 |
| Liabilities | 148,509 | 141,877 | |
| I | Non-current liabilities | 141,139 | 133,465 |
| A | Provisions | 0 | 0 |
| Pensions | |||
| Other | |||
| B | Non-current financial debts | 137,768 | 131,315 |
| a | Credit institutions | 137,768 | 131,315 |
| b | Financial leasing | ||
| C | Other non-current financial liabilities | 650 | 1,866 |
| Permitted hedging instruments | 650 | 1,866 | |
| Other | |||
| F | Deferred taxes – liabilities | 2,720 | 284 |
| a | Exit tax | 0 | 0 |
| b | Other | 2,720 | 284 |
| II | Current liabilities | 7,371 | 8,412 |
| D | Trade debts and other current liabilities | 4,196 | 5,729 |
| Exit taks | 2,126 | 3,469 | |
| Andere | 2,070 | 2,260 | |
| Suppliers | 792 | 1,244 | |
| Tenants | 610 | 0 | |
| Trade debts and other current liabilities | 668 | 1,016 |
| Total equity and liabilities | 366,585 | 273,507 | |
|---|---|---|---|
| Other | 1,247 | 588 | |
| Property income received in advance | 323 | 512 | |
| F | Accruals and deferred payments | 1,570 | 1,100 |
| Other | 1,605 | 1,583 | |
| E | Other current liabilities | 1,605 | 1,583 |
| Capital | Issue premiums |
Reserves | Net result of the financial year |
Equity | |
|---|---|---|---|---|---|
| Balance on 1 January 2016 | 76,321 | 25,615 | 6,961 | -515 | 108,382 |
| Net appropriation of income 2015 | 6,961 | -514 | 514 | 6,961 | |
| Transfer of result on the portfolio to reserves | -514 | 514 | 0 | ||
| Transfer of operating result to reserves | 0 | ||||
| Result for the period | 1,018 | 1,018 | |||
| Other elements recognised in the comprehensive result |
0 | ||||
| Impact on the fair value of the estimated transaction fees and costs |
0 | ||||
| resulting from hypothetical disposal of investment property |
0 | ||||
| Variations in the fair value of financial assets and liabilities |
0 | ||||
| Issue of new shares | 0 | ||||
| Capital increase through non-cash contribution | 5,766 | 5,766 | |||
| Costs of issuing new shares and of capital increase |
0 | ||||
| Capital reduction to create an available reserve to cover future losses |
-6,961 | -6,961 | |||
| Partial allocation of capital to issue premiums | -1,615 | 1,615 | 0 | ||
| Dividends | 0 | ||||
| Balance on 30 June 2016 | 87,434 | 27,230 | -514 | 1,017 | 115,166 |
| Capital | Issue premiums |
Reserves | Net result of the financial year |
Equity | |
|---|---|---|---|---|---|
| Balance on 1 January 2017 | 94,869 | 32,261 | -515 | 5,016 | 131,631 |
| Net appropriation of income 2016 | |||||
| Transfer of result on the portfolio to reserves | 1,110 | -1,110 | 0 | ||
| Transfer of operating result to reserves | 108 | -108 | 0 | ||
| Result for the period | 5,770 | 5,770 | |||
| Other elements recognised in the comprehensive result |
0 | ||||
| Impact on the fair value of the estimated transaction fees and costs |
0 | ||||
| resulting from hypothetical disposal of investment property |
0 | ||||
| Variations in the fair value of financial assets and liabilities |
-1,866 | 1,866 | 0 | ||
| Issue of new shares | 83,992 | 83,992 | |||
| Capital increase through non-cash contribution | 5,064 | 5,064 | |||
| Costs of issuing new shares and of capital increase |
-2,152 | -2,152 | |||
| Capital reduction to create an available reserve to cover future losses |
0 | ||||
| Partial allocation of capital to issue premiums | -37,616 | 37,616 | 0 | ||
| Deferred taxes related to Dutch property | -563 | -563 | |||
| Dividends | -5,665 | -5,665 | |||
| Balance on 30 June 2017 | 144,156 | 69,877 | -1,726 | 5,769 | 218,077 |
| Reserve for the | Reserve for the impact on the Fair Value of the estimated transaction fees and costs resulting from |
||
|---|---|---|---|
| Detail of reserves | Statutory reserves |
balance of the variations in the Fair Value of property |
the hypothetical disposal of investment property |
| Balance on 1 January 2016 | 0 | 0 | 0 |
| Net appropriation of income | 0 | 0 | 0 |
| Transfer of result on the portfolio to reserves | 4,044 | -4,565 | |
| Transfer of operating result to reserves | |||
| Other elements recognised in the comprehensive result |
0 | 0 | 0 |
| Impact on the Fair Value of the estimated transaction fees and costs |
|||
| resulting from hypothetical disposal of investment property |
|||
| Variations in the Fair Value of financial assets and liabilities |
|||
| Issue of new shares | |||
| Capital increase through non-cash contribution | |||
| Costs of issuing new shares and of capital increase | |||
| Capital reduction to create an available reserve to cover future losses |
|||
| Dividends | |||
| Other | |||
| Balance on 30 June 2016 | 0 | 4,044 | -4,565 |
| Retained earnings over from previous financial Total of the years reserves |
Other reserves |
Available reserve: reserve for expected losses |
Reserve for the balance of the variations in the Fair Value of permitted hedging instruments that are subject to hedging accounting as defined in the IFRS |
|
|---|---|---|---|---|
| 0 | 0 | 6,961 | 0 | |
| 0 | 0 | 0 | 0 | |
| 6 | ||||
| 0 | 0 | 0 | 0 | |
| -6,961 | ||||
| 6 | 0 | 0 | 0 |
| Reserve for the balance of the |
Reserve for the impact on the Fair Value of the estimated transaction fees and costs resulting from the hypothetical |
||
|---|---|---|---|
| Figures in thousands of EUR. | Statutory reserves |
variations in the Fair Value of property |
disposal of investment property |
| Balance on 1 January 2017 | 4,044 | -4,565 | |
| Net appropriation of income | |||
| Transfer of result on the portfolio to reserves | 3,187 | -2,077 | |
| Transfer of operating result to reserves | |||
| Other elements recognised in the comprehensive result |
|||
| Impact on the Fair Value of the estimated transaction fees and costs |
|||
| resulting from hypothetical disposal of investment property |
|||
| Variations in the Fair Value of financial assets and liabilities |
|||
| Issue of new shares | |||
| Capital increase through non-cash contribution | |||
| Costs of issuing new shares and of capital increase | |||
| Capital reduction to create an available reserve to cover future losses |
|||
| Deferred taxes related to Dutch property | -563 | ||
| Dividends | |||
| Other | |||
| Balance on 30 June 2017 | 0 | 6,668 | -6,642 |
| Total of the reserves |
Retained earnings over from previous financial years |
Other reserves |
Available reserve: reserve for expected losses |
Reserve for the balance of the variations in the Fair Value of permitted hedging instruments that are subject to hedging accounting as defined in the IFRS |
|
|---|---|---|---|---|---|
| -515 | 6 | 0 | 0 | 0 | |
| 5,015 | 5,015 | ||||
| -1,110 | |||||
| 1,866 | -1,866 | ||||
| -563 | |||||
| -5,665 | -5,665 | ||||
| -1,728 | 112 | 0 | 0 | -1,866 |
| 30/06/2017 | 30/06/2016 | ||
|---|---|---|---|
| Cash and cash equivalents at the start of the period | 4,098 | 4,384 | |
| 1 | Cash flow from operating activities | 1,113 | -1,591 |
| Cash flow from operations | 4,814 | 3,493 | |
| Operating income | 6,256 | 4,096 | |
| Interest paid | -1,209 | -624 | |
| Interest received | 17 | 21 | |
| Other | 0 | 0 | |
| Corporate taxes paid | -250 | 0 | |
| Non-cash elements added to/subtracted from the result | -2,339 | -1,890 | |
| Amortisations and impairments | 22 | ||
| Amortisations/impairments (or writebacks) on tangible and intangible assets |
22 | ||
| Other non-cash elements | -2,339 | -1,912 | |
| Variations in the fair value of the real estate property | -2,070 | -1,912 | |
| Other non-cash elements | -269 | 0 | |
| Variation in working capital requirements: | -798 | -3,193 | |
| Movement of assets: | -782 | -611 | |
| Movement of liabilities: | -316 | -2,582 | |
| 2 | Cash flow from investment activities | -80,189 | -8,469 |
| Acquisition of investment property and property developments | -53,726 | -8,801 | |
| Sale of investment property | 0 | 0 | |
| Purchase of shares in real estate companies | -26,434 | 0 | |
| Sale of shares in real estate companies | 0 | 0 | |
| Acquisition of other tangible assets | -30 | -47 | |
| Acquisition of non-current financial fixed assets | 0 | -2 | |
| Receivables on trade and other non-current assets | 0 | 195 | |
| Assets held for sale | 0 | 185 | |
| 3 | Cash flow from financing activities | 80,766 | 5,995 |
| 76,414 | 8,022 |
|---|---|
| -70,000 | -2,031 |
| 0 | |
| -1,822 | 0 |
| 0 | 0 |
| 83,992 | 0 |
| 4 | |
| -2,152 | 0 |
| -5,665 | 0 |
| 4 | 65 |
| 5,792 | 384 |
Xior Student Housing NV is a public RREC (Regulated Real Estate Company) that is subject to the application of Belgian law and has its registered office in Antwerp.
This interim financial information for the period ending on 30 June 2017 was drawn up in accordance with IAS 34 'Interim Financial Reporting'. This interim report must be read together with the financial statement for the financial year ending on 31 December 2016. In the first half of 2017, Xior did not include any new IFRS standards or interpretations in its principles and the valuation rules applied to prepare the interim financial information are identical to those applied for the financial year ending on 31 December 2016.
These figures include Xior Student Housing NV and its subsidiaries (the 'Group').
No statutory half-year financial report was drawn up on 30 June 2017. The statutory financial statement is only drawn up at year-end.
The figures published in this Half-Yearly Report are consolidated figures: the subsidiaries are consolidated in accordance with the relevant legislation.
The segmentation basis for reporting by segment is by geographic region. The rental income is broken down by geographic location: Belgium and the Netherlands. Every location is broken down further into students and other. Commercial decisions are taken at this level and rental income and occupancy rate are followed up at this level.
The unallocated amounts category includes all expenses that cannot be allocated to a segment.
Only the net rental income and result on the portfolio are broken down by segment on the income statement.
| Belgium | The Netherlands | Non allocated |
||||
|---|---|---|---|---|---|---|
| On 30/06/2017 | Students | Other | Students | Other | amounts | Total |
| Net rental income | 3,531 | 788 | 2,436 | 632 | 7,387 | |
| Real estate result | 6,896 | |||||
| Property charges | -1,740 | -1,740 | ||||
| Real estate operating result | 5,156 | |||||
| General expenses | -1,022 | -1,022 | ||||
| Other operating result and costs | 52 | 52 | ||||
| Operating result before result on the portfolio |
4,186 | |||||
| Result from the sale of investment property |
0 | |||||
| Variations in the Fair Value of investment property |
394 | -73 | 624 | -135 | 810 | |
| Other result on the portfolio | 1,260 | 1,260 | ||||
| Operating result | 6,256 | |||||
| Financial result | -107 | -107 | ||||
| Result before taxes | 6,148 | |||||
| Taxes | -378 | -378 | ||||
| Net result | 5,770 | |||||
| EPRA earnings | 2,537 | |||||
| Result on the portfolio | 394 | -73 | 624 | 1,125 | 2,070 |
| Non Belgium The Netherlands allocated |
||||||
|---|---|---|---|---|---|---|
| Per 30/06/2017 | Students | Other | Students | Other | amounts | Total |
| Total assets | 165,709 | 30,338 | 91,058 | 69,455 | 10,025 | 366,585 |
| Investment property | 165,709 | 30,338 | 91,058 | 69,455 | 356,560 | |
| Other assets | 10,025 | 10,025 | ||||
| Total liabilities and equity | 366,585 | 366,585 | ||||
| Equity | 218,076 | 218,076 | ||||
| Liabilities | 148,509 | 148,509 |
| Belgium | Non The Netherlands |
||||||
|---|---|---|---|---|---|---|---|
| On 30/06/2016 | Students | Other | Students | Other | allocated amounts |
Total | |
| Net rental income | 2,578 | 1,059 | 918 | 174 | 4,729 | ||
| Real estate result | 4,413 | ||||||
| Property charges | -1,186 | -1,186 | |||||
| Real estate operating result | 3,227 | ||||||
| General expenses | -1,044 | -1,044 | |||||
| Other operating result and costs | 0 | 0 | |||||
| Operating result before result on the portfolio |
2,183 | ||||||
| Result from the sale of investment property |
0 | ||||||
| Variations in the Fair Value of investment property |
628 | -1 | 1,270 | 78 | 1,975 | ||
| Other result on the portfolio | -63 | -63 | |||||
| Operating result | 4,096 | ||||||
| Financial result | -2,776 | -2,776 | |||||
| Result before taxes | 1,320 | ||||||
| Taxes | -301 | -301 | |||||
| Net result | 1,018 | ||||||
| EPRA earnings | 1,288 | ||||||
| Result on the portfolio | 565 | -1 | 1,270 | 78 | 1,912 |
| Belgium | The Netherlands | Non allocated |
||||
|---|---|---|---|---|---|---|
| On 31/12/2016 | Students | Other | Students | Other | amounts | Total |
| Total assets | 158,349 | 28,278 | 76,611 | 2,635 | 7,634 | 273,507 |
| Investment property | 158,349 | 28,278 | 76,611 | 2,635 | 265,873 | |
| Other assets | 7,634 | 7,634 | ||||
| Total liabilities and equity | 273,507 | 273,507 | ||||
| Equity | 131,630 | 131,630 | ||||
| Liabilities | 141,877 | 141,877 |
| APM terms | Definition | Use |
|---|---|---|
| EPRA earnings | The net result +/- variations in the fair value of investment property +/- other result on the portfolio +/- income from the sale of investment property +/- variations in the fair value of financial assets and liabilities +/- deferred taxes on IAS 40 corrections |
Measuring the income from the strategic operating activities, excluding variations in the fair value of investment property, other result on the portfolio, the result from the sale of investment property, variations in the fair value of financial assets and liabilities and the deferred taxes on IAS 40 corrections. This indicates the extent to which dividend payments are supported by the earnings. |
| EPRA earnings after IFRIC 21 adjustment |
The net result +/- variations in the Fair Value of investment property +/- other result on the portfolio +/- result from the sale of investment property +/- variations in the fair value of financial assets and liabilities +/- deferred taxes on IAS 40 correction +/- impact of IFRIC 21 divided over the four quarters. |
Measuring the income from the strategic operating activities, excluding variations in the fair value of investment property, other result on the portfolio, the result from the sale of investment property and variations in the fair value of financial assets and liabilities , deferred taxes on IAS 40 corrections and with adjustment for the impact of IFRIC 21. This indicates the extent to which dividend payments are supported by the earnings. |
| Result on the portfolio |
Income from the sale of investment property +/- variations in the fair value of investment property +/- other result on the portfolio |
Measuring the realised and unrealised gain/ loss on investment property |
|---|---|---|
| Average interest rate |
Interest charges including IRS interest expense divided by the average outstanding debt during the period |
Measuring the average debt interest costs to allow a comparison with peers and analysis of the evolution over time |
| Average interest rate excl. IRS interest charges |
Interest charges excluding IRS interest expense divided by the average outstanding debt during the period |
Measuring the average debt interest costs to allow a comparison with peers and analysis of the evolution over time |
| Average financing costs |
Interest costs including IRS interest expense + arrangement fees and commitment fees, divided by the average outstanding debt during the period |
Measuring the average debt financing cost to allow a comparison with peers and analysis of the evolution over time |
| Average financing cost excl. IRS interest charges |
Interest charges including IRS interest charges + arrangement fees and commitment fees, divided by the average outstanding debt during the period |
Measuring the average debt financing cost to allow a comparison with peers and analysis of the evolution over time |
| EPRA earnings per share |
The net result +/- income from the sale of investment property +/- variations in the fair value of investment property +/- other result on the portfolio +/- variations in the fair value of financial assets and liabilities, +/- deferred taxes on IAS 40 correction divided by the average number of shares |
Comparability with other RRECs and international property players |
| EPRA earnings per share after IFRIC 21 adjustment |
The net result +/- income from the sale of investment property +/- variations in the fair value of investment property +/- other result on the portfolio +/- variations in the fair value of financial assets and liabilities +/- deferred taxes on IAS 40 correction +/- IFRIC 21 adjustment, divided by the average number of shares |
Comparability with other RRECs and international property players |
EPRA earnings: as per 30 June 2017 the definition and calculation of the APM EPRA earnings has been changed. The calculation now also takes into account the impact of deferred taxes on IAS 40 corrections. This is related to deferred taxes on the Dutch property. As the deferred taxes are an accessorium of the movement in fair value and as the movements are also non-cash items, it seems more relevant to include these also in the EPRA earnings calculation.
This modified calculation also aligns better to the definition of EPRA earnings under the EPRA reference system19.
This change in definition/calculation has a positive impact of 0.01 Euro on the EPRA earnings per share per 30 June 2017. There is no impact of this change in calculation on the EPRA earnings per share per 30 June 2016.
| EPRA earnings | 30/06/2017 | 30/06/2016 |
|---|---|---|
| Net result | 5,770 | 1,018 |
| Variations in the fair value of the real estate property | -810 | -1,964 |
| Other result on the portfolio | -1,260 | 52 |
| Result from the sale of investment property | 0 | 0 |
| Variations in the fair value of financial assets and liabilities | -1,216 | 2,173 |
| Deferred taxes on IAS 40 corrections | 52 | 8 |
| EPRA earnings | 2,537 | 1,288 |
| EPRA earnings after IFRIC 21 adjustment | 30/06/2017 | 30/06/2016 |
|---|---|---|
| Net result | 5,770 | 1,018 |
| Variations in the fair value of the real estate property | -810 | -1,964 |
| Other result on the portfolio | -1,260 | 52 |
| Result from the sale of investment property | 0 | 0 |
| Variations in the fair value of financial assets and liabilities | -1,216 | 2,173 |
| Deferred taxes on IAS 40 corrections | 52 | 8 |
| EPRA earnings | 2,537 | 1,288 |
| IFRIC 21 impact | 345 | 305 |
| EPRA earnings after IFRIC 21 adjustment | 2,882 | 1,592 |
19 Reference is made to the EPRA Best Practices Recommendations. Visit the website www.epra.com.
| Result on the portfolio | 30/06/2017 | 30/06/2016 |
|---|---|---|
| Result from the sale of investment property | 0 | 0 |
| Variations in the fair value of the real estate property | 810 | 1,964 |
| Other result on the portfolio | 1,260 | -52 |
| Result on the portfolio | 2,070 | 1,912 |
| Average interest rate | 30/06/2017 | 30/06/2016 |
|---|---|---|
| Nominal interest paid on loans | 944 | 301 |
| Costs of permitted hedging instruments | 329 | 160 |
| Capitalised interest | 171 | 246 |
| Average outstanding debt for the period | 162,215 | 77,578 |
| Average interest rate | 1.78% | 1.82% |
| Average interest rate excl. costs of permitted hedging instruments | 1.37% | 1.41% |
| Average financing costs | 30/06/2017 | 30/06/2016 |
|---|---|---|
| Nominal interest paid on loans | 944 | 301 |
| Costs of permitted hedging instruments | 329 | 160 |
| Capitalised interest | 171 | 246 |
| Reconstitution of the nominal amount of financial debt | 39 | 28 |
| Bank costs and other commissions | 29 | 135 |
| Average outstanding debt for the period | 162,215 | 77,578 |
| Average financing costs | 1.86% | 2.24% |
| Average financing cost excl. costs of permitted hedging instruments | 1.46% | 1.83% |
| EPRA earnings per share | 30/06/2017 | 30/06/2016 |
|---|---|---|
| Net result | 5,770 | 1,018 |
| Variations in the fair value of the real estate property | -810 | -1,964 |
| Other result on the portfolio | -1,260 | 52 |
| Result from the sale of investment property | 0 | 0 |
| Variations in the fair Value of financial assets and liabilities | -1,216 | 2,173 |
| Deferred taxes on IAS 40 corrections | 52 | 8 |
| Weighted average number of shares | 5,553,555 | 4,781,396 |
| EPRA earnings per share | 0.46 | 0.27 |
| IFRIC 21 impact | 345 | 305 |
| EPRA earnings per share after IFRIC 21 adjustment | 0.52 | 0.33 |
| EPRA NAV | 30/06/2017 | 31/12/2016 |
|---|---|---|
| Net asset value according to the financial statement | 218,076 | 131,630 |
| To be excluded: | ||
| Fair value of the assets and liabilities | 650 | 1,866 |
| EPRA NAV | 218,726 | 133,496 |
| EPRA NAV (EUR/share) | 26.91 | 25.33 |
| EPRA triple net asset value (NNNAV) | 30/06/2017 | 31/12/2016 |
|---|---|---|
| EPRA NAV | 218,726 | 133,496 |
| To be added: | ||
| Fair Value of the assets and liabilities | -650 | -1,866 |
| EPRA NAV | 218,076 | 131,630 |
| EPRA NAV (EUR/share) | 26.83 | 24.97 |
| EPRA cost ratio | 30/06/2017 | 30/06/2016 |
|---|---|---|
| General expenses | 1,022 | 1,044 |
| Impairment of trade receivables | 9 | 0 |
| Property charges | 1,740 | 1,186 |
| EPRA costs (incl. vacancy costs) | 2,771 | 2,230 |
| Vacancy costs | 19 | 0 |
| EPRA costs (excl. vacancy costs) | 2,751 | 2,230 |
| Gross rental income | 7,396 | 4,727 |
| EPRA cost ratio (incl. vacancy costs) | 37.5% | 47.2% |
| EPRA cost ratio (excl. vacancy costs) | 37.2% | 47.2% |
| IFRIC 21 impact | 345 | 305 |
| EPRA cost ratio (incl. vacancy costs) after IFRIC 21 adjustment | 32.8% | 40.7% |
| EPRA cost ratio (excl. vacancy costs) after IFRIC 21 adjustment | 32.5% | 40.7% |
Due to the rounding off to thousands, rounding differences may arise between the balance sheet, income statement and enclosed details.
Figures in thousands of EUR
| 30/06/2017 | 30/06/2016 | ||
|---|---|---|---|
| (+) | Rental income | 7,396 | 4,727 |
| Rent | 7,367 | 4,171 | |
| Rental guarantees | 43 | 556 | |
| Rent reductions | -14 | 0 | |
| (+) | Writeback of rental carried over and discounted | ||
| (+/-) | Rent-related expenses | -9 | 0 |
| Net rental income | 7,387 | 4,727 | |
| (+) | Recovery of property charges | 0 | 0 |
| (+) | Recovery of rental charges and taxes normally payable by the tenants for let properties |
1,191 | 587 |
| (-) | Costs payable by tenants and borne by the landlord for rental damage and refurbishment at the end of the tenancy |
0 | 0 |
| (-) | Rental charges and taxes normally payable by the tenants for let properties |
-1.369 | -678 |
| (+/-) | Other rent-related income and expenditure | -314 | -223 |
| Real estate result | 6,895 | 4,413 |
Rent-related expenses include entered impairments on rent receivables.
| 30/06/2017 | 30/06/2016 | |
|---|---|---|
| (+/-) Summary of rental income that could cease to exist in future |
||
| Within one year | 5,999 | 4,205 |
| Between one and five years | 466 | 168 |
| More than five years | 931 | 354 |
| Total | 7,396 | 4,727 |
The above table shows how much of the rental income earned in the first half of 2017 could theoretically cease to exist in future if the current tenants give notice of termination on the next contractually permitted date and no new tenant is found.
Most of Xior Student Housing NV's tenancy agreements are short-term contracts for letting student units. These contracts are typically concluded for a one-year period, after which they can be extended. Xior also tries to conclude long-term contracts with colleges or universities for some of the rooms in its portfolio. In the course of 2016, the Company signed a contract with Hogeschool Gent for a 20-year term for the rental of 318 of the 490 student rooms in the complex located at Overwale 42-44 in Ghent. The Company also signed a contract with Stichting Zuyd Hogeschool for the rental of 60 of 134 student rooms and with Maastricht University for the rental of 20 of 134 student rooms at the student complex located at Vijverdalseweg in Maastricht. These contracts were originally signed for a three-year term in August 2014 and were extended by one year until August 2018. On 30 June 2017, 15% of the total number of lettable student units was let with the help of colleges or universities. These contracts with colleges and universities account for 11% of the rental income.
Xior Student Housing NV also has several other types of tenancy agreements that are also long-term. These are mainly the tenancy agreements for the commercial properties, which typically have terms that exceed one year. The term of these contracts generally varies from three to ten years.
Rents are paid monthly and in advance. Certain property-related costs, such as running costs, taxes and levies and the communal costs are also charged to the tenant. Tenants pay a fixed monthly advance payment for this purpose with an annual settlement, or a fixed annual amount is charged to cover these costs. In order to guarantee tenants comply with their obligations, a rental guarantee of at least one month's rent, and in most cases two months' rent, is charged. This is paid mostly in cash and reflected on the balance sheet under other short-term liabilities.
Figures in thousands of EUR
| 30/06/2017 | 30/06/2016 | ||
|---|---|---|---|
| (+/-) | Result from the sale of investment property | 0 | 0 |
| (+/-) | Result from the sale of other non-financial assets | 0 | 0 |
| (+/-) | Variations in the Fair Value of investment property | 810 | 1,964 |
| Positive variations in the Fair Value of investment property | 1,949 | 2,884 | |
| Negative variations in the Fair Value of investment property | -1,139 | -921 | |
| Positive variations of the estimated transaction fees and costs resulting from hypothetical disposal of investment property |
0 | 0 | |
| Negative variations of the estimated transaction fees and costs resulting from hypothetical disposal of investment property |
0 | 0 | |
| (+/-) | Other result on the portfolio | 1,260 | -52 |
| (+/-) | Result on the portfolio | 2.070 | 1.912 |
Properties were acquired through property acquisitions (sale-purchase c.q. contributions) and share acquisitions in the first half of 2017.
The property was acquired at the fiduciary value (the purchase price agreed between the parties), which was different from the Fair Value.
Figures in thousands of EUR
| 30/06/2017 | 30/06/2016 | ||
|---|---|---|---|
| (+) | Financial income | 17 | 21 |
| (-) | Net interest expense | -1,323 | -489 |
| Nominal interest paid on loans | -944 | -301 | |
| Reconstitution of the nominal amount of financial debt | -39 | -28 | |
| Costs of permitted hedging instruments | -329 | -160 | |
| (-) | Other interest costs | -11 | |
| (-) | Other financial costs | -16 | -135 |
| Bank costs and other commissions | -25 | -138 | |
| Other | 9 | 3 | |
| (+/-) | Variations in the fair value of financial assets and liabilities | ||
| Market value of interest rate swaps | 1,216 | -2,173 | |
| Variations in the fair value of participations | |||
| (+/-) | Financial result | -107 | -2,776 |
The average interest rate 20 was 1.78% (1.37% without hedging instruments) on 30 June 2017 and was 1.82% on 30 June 2016. The average financing cost was 1.86% on 30 June 2017, compared to 2.24% on 30 June 2016.
The Company is subject to fluctuations in interest rates, because all long-term liabilities were entered into on the basis of variable interest rates. An increase in the interest rate can therefore cause an increase in the interest charges. One of the IRS contracts was renegotiated in the course of May 2017. 94% of the loans was hedged with IRS contracts on 30 June 2017.
The derivatives used by Xior Student Housing NV do not qualify as hedging transactions. As a result, the changes in fair value are included in the income statement immediately.
| Investment table | Investment property in operation |
Property devel opments |
Total |
|---|---|---|---|
| Balance on 1 January 2016 | 157,879 | 36,875 | 194,754 |
| Acquisition through purchase or contributions of real estate companies |
33,048 | 0 | 33,048 |
| Further CAPEX investments | 2,270 | 11,767 | 14,037 |
| Purchase and contribution of investment property | 25,298 | 0 | 25,298 |
| Sale of investment property | -2,763 | 0 | -2,763 |
| Capitalised interest charges | 0 | 389 | 389 |
| Variation in the Fair Value | 603 | 509 | 1,112 |
| Transfer from/to | 49,539 | -49,539 | 0 |
| Balance on 31 December 2016 | 265,873 | 0 | 265,873 |
| Acquisition through purchase or contributions of real estate companies |
66,955 | 0 | 66,955 |
| Further CAPEX investments | 795 | 3,441 | 4,236 |
| Purchase and contribution of investment property | 13,528 | 5,063 | 18,591 |
| Sale of investment property | 0 | ||
| Capitalised interest charges | 75 | 21 | 96 |
| Variation in the Fair Value | 419 | 391 | 810 |
| Transfer from/to | -4,845 | 4,845 | 0 |
| Balance on 30 June 2017 | 342,800 | 13,761 | 356,560 |
Figures in EUR
| Date | Transaction |
|---|---|
| 10/03/2014 | Incorporation of company |
| 23/09/2015 | Capital increase |
| 23/11/2015 | Share split |
| 11/12/2015 | Sister mergers |
| 11/12/2015 | Capital increase by way of non-cash contribution as a result of the Share Contribution |
| 11/12/2015 | Mergers by acquisition |
| 11/12/2015 | Capital increase below accounting par value through cash contributions for the issue of new shares |
| 11/12/2015 | Capital reduction to create a reserve to cover foreseeable losses |
| 1/03/2016 | Merger with Devimmo NV |
| 1/08/2016 | Merger with CPG CVBA |
| 11/10/2016 | Contribution in kind of Woonfront-Tramsingel BV |
| 17/01/2017 | KVS project contribution in kind |
| 22/06/2017 | Capital increase |
| Date | Transaction | Issue premiums |
|---|---|---|
| 31/12/2015 | 25,615 | |
| 1/03/2016 | Merger with Devimmo NV | 1,615 |
| 1/08/2016 | Merger with CPG CVBA | 514 |
| 11/10/2016 | Woonfront contribution in kind | 4,517 |
| 17/01/2017 | KVS project contribution in kind | 2,394 |
| 22/06/2017 | Capital increase | 35,222 |
| Total issue premiums on 30 June 2017 | 69,877 |
| Accounting par value (EUR) |
New number of shares |
Previous number of shares |
New capital (EUR) |
Capital increase (EUR) |
Previous capital (EUR) |
|---|---|---|---|---|---|
| 100.00 | 200.00 | 20,000.00 | 20,000.00 | ||
| 100.00 | 12,500.00 | 200.00 | 1,250,000.00 | 1,230,000.00 | 20,000.00 |
| 29.41 | 42,500.00 | 12,500.00 | 1,250,000.00 | 1,250,000.00 | |
| 25.19 | 975,653.00 | 42,500.00 | 24,578,937.02 | 23,328,937.02 | 1,250,000.00 |
| 25.17 | 1,105,923.00 | 975,653.00 | 27,835,720.03 | 3,256,783.01 | 24,578,937.02 |
| 25.15 | 1,253,764.00 | 1,105,923.00 | 31,531,780.11 | 3,696,060.08 | 27,835,720.03 |
| 19.50 | 4,626,780.00 | 1,253,764.00 | 90,242,678.39 | 58,710,898.28 | 31,531,780.11 |
| 18.00 | 4,626,780.00 | 4,626,780.00 | 83,282,040.00 | -6,960,638.39 | 90,242,678.39 |
| 18.00 | 4,857,437.00 | 4,626,780.00 | 87,433,866.00 | 4,151,826.00 | 83,282,040.00 |
| 18.00 | 4,930,823.00 | 4,857,437.00 | 88,754,814.00 | 1,320,948.00 | 87,433,866.00 |
| 18.00 | 5,270,501.00 | 4,930,823.00 | 94,869,018.00 | 6,114,204.00 | 88,754,814.00 |
| 18.00 | 5,418,833.00 | 5,270,501.00 | 97,538,994.00 | 2,669,976.00 | 94,869,018.00 |
| 18.00 | 8,128,249.00 | 5,418,833.00 | 146,308,482.00 | 48,769,488.00 | 97,538,994.00 |
| 30/06/2017 | 30/06/2016 | |
|---|---|---|
| Number of ordinary shares in circulation | 8,128,249 | 4,857,437 |
| Weighted average number of shares | 5,553,555 | 4,781,396 |
| Net result per ordinary share (in EUR) | 1.04 | 0.21 |
| Diluted net result per ordinary share (in EUR) | 1.04 | 0.21 |
| EPRA earnings per share (in EUR) | 0.46 | 0.27 |
| EPRA earnings per share after IFRIC 21 adjustment | 0.52 | 0.33 |
The other non-current financial liabilities on 30 June 2017 were KEUR 650. They relate to the market value of the outstanding interest rate swap (IRS) agreements on 30 June 2017.
| IFRS classification |
Level (IFRS) |
Notional amount |
Variable interest rate (in %) |
Fixed interest rate (in %) |
Expires on | Fair value liabilities |
|---|---|---|---|---|---|---|
| Interest rate swap | 2 | 52,000,000 | Euribor 3M | 0.465% | 29/12/2023 | -372,900.00 |
| Interest rate swap | 2 | 78,000,000 | Euribor 3M | 0.56% | 25/05/2024 | -277,562.76 |
| Totaal | 130.000.000 | -650.462,76 |
The market value of the outstanding IRS contracts is received from the various financial institutions.
| 30/06/2017 | 31/12/2016 | |
|---|---|---|
| Non-current financial debts | ||
| Bilateral loans – variable or fixed interest rate | 138,000 | 131,500 |
| Loan drawdown costs | -232 | -185 |
| Total | 137,768 | 131,315 |
Figures in thousands of EUR
| 30/06/2017 | 31/12/2016 | |
|---|---|---|
| Non-current financial debts (excl. interest) - Breakdown according to maturity21 |
||
| Between one and two years | 12,000 | 29,971 |
| Between two and five years | 118,000 | 101,345 |
| More than five years | 8,000 | 0 |
| Total | 138,000 | 131,315 |
Figures in thousands of EUR
| 30/06/2017 | 31/12/2016 | |
|---|---|---|
| Unused loans | ||
| Due within one year | 17,000 | 0 |
| Due after one year | 70,000 | 18,500 |
| Total | 87,000 | 18,500 |
All financial debts have no underlying collateral.
All financial debts have a variable interest rate. In January 2016, IRS contracts were concluded with a start date of 2 February 2016. These contracts were renegotiated in December 2016 and May 2017, respectively. A total of KEUR 130,000 in financing is hedged with IRS contracts. This means 94% of drawn down financing is hedged.
21 The estimated future interest charges broken down based on maturity are included below in a separate table.
Figures in thousands of EUR
| 30/06/2017 | 31/12/2016 | |
|---|---|---|
| Estimated future interest charges | ||
| Within one year | 1,434 | 1,985 |
| Between one and five years | 3,110 | 4,207 |
| More than five years | ||
| Total | 4,544 | 6,192 |
Figures in thousands of EUR
| 30/06/2017 | 31/12/2016 | |
|---|---|---|
| Liquidity liability at maturity dates associated with the hedging instruments |
||
| Within one year | 679 | 543 |
| Between one and five years | 2,219 | 1,126 |
| More than five years | ||
| Total | 2,898 | 1,669 |
The estimate of interest expenses takes into account the debt position on 30 June 2017.
| Summary of financial assets and liabilities |
30/06/2017 Carrying amount |
30/06/2017 Fair Value |
31/12/2016 Carrying amount |
31/12/2016 Fair Value |
|---|---|---|---|---|
| Assets | ||||
| Financial fixed assets | 156 | 156 | 156 | 156 |
| Financial fixed assets | 21 | 21 | 21 | 21 |
| Trade receivables and other fixed assets |
135 | 135 | 135 | 135 |
| Financial current assets | 8,737 | 8,737 | 6,691 | 6,691 |
|---|---|---|---|---|
| Trade receivables | 385 | 385 | 542 | 542 |
| Tax receivables and other current assets |
2,560 | 2,560 | 2,051 | 2,051 |
| Cash and cash equivalents | 5,792 | 5,792 | 4,098 | 4,098 |
| Total financial assets | 8,893 | 8,893 | 6,847 | 6,847 |
| Liabilities | ||||
| Non-current financial liabilities | 138,418 | 138,418 | 133,181 | 133,181 |
| Non-current financial liabilities | 137,768 | 137,768 | 131,315 | 131,315 |
| Financial derivatives | 650 | 650 | 1,866 | 1,866 |
| Current financial liabilities | 5,801 | 5,801 | 7,312 | 7,312 |
| Trade debts and other current liabilities |
4,196 | 4,196 | 5,729 | 5,729 |
| Other current liabilities | 1,605 | 1,605 | 1,583 | 1,583 |
| Total financial liabilities | 144,219 | 144,219 | 140,493 | 140,493 |
Trade debts and payables are recorded at amortised cost. The above are all assets for which the change in fair value is entered under the result.
Figures in thousands of EUR
| 30/06/2017 | 30/06/2016 | |
|---|---|---|
| Transactions with related parties | ||
| Management fee | 336 | 300 |
| Fee of independent directors | 37 | 48 |
| Total | 373 | 348 |
The related parties the Company associates with are its subsidiaries and its directors and executives. Transactions with the subsidiaries are eliminated in the consolidation.
The fee for directors and executives is included under the item 'General company expenses'.
On 30 June 2017, Xior Student Housing NV had KEUR 1,712 in receivables from Aloxe, the Company's promoter. These receivables resulted mainly from the provided rental guarantees for certain projects during the IPO.
No other transactions took place with persons or institutions regarded as direct company stakeholders during the first half of 2017.
We refer to chapter 2.3.2 of this Half-Yearly Report for events after the balance sheet date.
There have been no other significant events with an impact on the consolidated figures since the closing of the half year.
The following subsidiaries are part of Xior Student Housing NV's scope of consolidation on 30 June 2017:
| Name | Country | Share in the capital |
|---|---|---|
| Stubis BVBA | Belgium | 100% |
| Amstelveen Keesomlaan 6-10 B.V. | The Netherlands | 100% |
| Bokelweg B.V. | The Netherlands | 100% |
| Burgwal B.V. | The Netherlands | 100% |
| Consolidated debt ratio (max. 65%) | 30/06/2017 | 31/12/2016 |
|---|---|---|
| Total liabilities | 148,509 | 141,877 |
| Adjustments | -4,941 | -3,250 |
| Total debts according to the Royal Decree of 13 July 2014 | 143,569 | 138,627 |
| Total assets | 366,585 | 273,507 |
| Adjustments | 0 | 0 |
| Total assets according to the Royal Decree of 13 July 2014 | 366,585 | 273,507 |
| Debt ratio (in %) | 39.17% | 50.69% |
A number of properties were acquired from third parties in the course of 2016 and 2017. The sellers provided rental guarantees for a number of these properties. The term of these rental guarantees varies from 12 to 24 months starting from the transfer date. More specifically, the Company received rental guarantees for the properties on Tongerseweg in Maastricht, Kronehoefstraat in Eindhoven, Tramsingel in Breda and Barbarasteeg in Delft.
Please refer to the press releases of 20 April 2016, 11 May 2016 and 7 June 2017 announcing that the Company signed agreements to acquire properties in Delft, The Hague and Rotterdam and agreed to a joint venture with regard to a development in Etterbeek. Please also refer to Chapter 5.6.1.2 of the Annual Report of 2016.
The Company has a few ongoing development projects for which agreements with contracts were concluded for the construction of these buildings.
We have reviewed the condensed consolidated interim figures of Xior Student Housing Ltd. and its subsidiaries as of 30 June 2017, consisting of the condensed consolidated income statement, the statement of other comprehensive income, the condensed consolidated balance sheet, the condensed consolidated statement of changes in shareholders' equity and the condensed consolidated cash flow statement for the 6-month period then ended, as well as the explanatory notes (together: "condensed consolidated interim figures"). The board of directors of the Statutory Management is responsible for the preparation and presentation of these condensed consolidated interim figures in accordance with IAS 34, as adopted by the European Union and implemented by the royal decree of 13 July 2014. Our responsibility is to express a conclusion on these condensed consolidated interim figures based on our review.
We conducted our review in accordance with International Standard on Review Engagements 2410, "Review of Interim Financial Information Performed by the Independent Auditor of the Entity." A review of interim financial information consists in making inquiries, primarily of persons responsible for financial and accounting matters, and in applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing and, consequently, does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Based on our review, nothing has come to our attention that causes us to believe that the condensed consolidated interim figures on 30 June 2017 is not prepared, in all material respects, in accordance with IAS 34, as adopted by the European Union and implemented by the royal decree of 13 July 2014.
Sint-Stevens-Woluwe, 23 August 2017
The statutory auditor PwC Reviseurs d'Entreprises sccrl / Bedrijfsrevisoren bcvba Represented by
Damien Walgrave Reviseur d'Entreprises / Bedrijfsrevisor
In accordance with Article 13, Section 2, 3° of the Royal Decree of 14 November 2007, the Board of Directors of Xior Student Housing NV22 states that to its knowledge:
This Half-Yearly Report contains forward-looking information, projections, convictions, opinions and estimates produced by Xior in relation to the expected future performance of Xior and the market in which it operates ('forward-looking statements'). By nature, forward-looking statements involve inherent risks, uncertainties and assumptions, both general and specific, that appear justified at the time at which they are made but which may or may not turn out to be accurate, and there is a risk that the forward-looking statements will not be realised. Some events are difficult to predict, and may depend on factors outside of Xior's control. In addition, the forward-looking statements are only valid on the date of this Half-Yearly Report. Statements in this press release relating to past trends or activities may not be interpreted as an indication that such trends or activities will persist in future. Neither Xior nor its representatives, officers or advisers can guarantee that the parameters upon which the forward-looking statements are based are free of errors, nor can they indicate, guarantee or predict whether the expected results set out in such a forward-looking statement will ultimately be achieved. Actual profits, the financial situation and Xior's performance or results may therefore differ substantially from the information projected or implied in forward-looking statements. Xior expressly declines any obligation or guarantee to publicly update or review forward-looking statements unless it is required to do so by law.
Klapdorp ANTWERPEN
| Name: | Xior Student Housing NV |
|---|---|
| Status: | Public regulated real estate company (RREC) under Belgian law (BE-RREC) |
| Registered office: | Mechelsesteenweg 34, Box 108, 2018 Antwerp |
| Tel.: | +32 3 257 04 89 |
| E-mail: | [email protected] |
| Website: | www.xior.be |
| Register of Legal Entities: |
Antwerp, Antwerp section |
| VAT: | BE 0547.972.794 |
| Enterprise number: | 0547.972.794 |
| Date of incorporation: | 10 March 2014 |
| Licence as RREC: | 24 November 2015 |
| Financial year-end | 31 December |
| General meeting: | Third Thursday in May (10am) |
| Listing: | Euronext Brussels – continuous market |
| ISIN code: | BE0974288202 (XIOR) |
| Statutory auditor: | PwC Bedrijfsrevisoren BCVBA, Woluwe Garden, Woluwedal 18, 1932 Sint-Stevens-Wo luwe, represented by Damien Walgrave |
| Financial services: | ING Belgium |
| Property experts: | Stadim CVBA & Cushman & Wakefield |
Xior Student Housing NV Public RREC under Belgian law (BE-RREC) Mechelsesteenweg 34, Box 108, 2018 Antwerp
BE 0547.972.794 Antwerp Register of Legal Entities, Antwerp section
www.xior.be I [email protected] T +32 3 257 04 89
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