Instone Real Estate Group AG

Quarterly Report • Nov 9, 2023

30 SEPTEMBER 2023

Q3 2023

QUARTERLY STATEMENT

INSTONE REAL ESTATE GROUP SE

Report on the Group's position

Consolidated financial statements

Other information

Key indicators			TABLE 001
In millions of euros
		9M 2023	9M 2022
Key performance indicators
Volume of sales contracts		91.3	250.2
Volume of new approvals 1		0.0	336.7
Revenues adjusted		433.3	441.9
Key earnings figures
Gross profit adjusted		110.7	113.8
Gross profit margin adjusted	In %	25.5	25.8
EBIT adjusted		65.8	60.9
EBIT margin adjusted	In %	15.2	13.8
EBT adjusted		53.2	49.3
EBT margin adjusted	In %	12.3	11.2
EAT adjusted		37.1	34.0
EAT margin adjusted	In %	8.6	7.7
Key liquidity figures
Cash flow from operations		18.7	– 26.7
Cash flow from operations without new investments		28.9	47.4
Free cash flow		23.1	– 17.4

Key indicators			TABLE 001
In millions of euros
		30/09/2023	31/12/2022
Key performance indicators
Project portfolio		7,015.5	7,668.8
Key balance sheet figures
Total assets		1,743.3	1,780.3
Equity		585.3	573.0
Carrying amount per share 1		13.51	13.07
Cash and cash equivalents and term deposits 2		177.0	255.6
Net financial debt 3		272.5	265.1
Leverage ratio 4		2.8	2.8
Loan-to-cost 5	In %	21.0	20.8
ROCE 6 adjusted	In %	10.8	10.2
Employees
Number 7		475	488
FTE 8		392.2	409.4

1 Excluding volume of approvals from joint ventures consolidated at equity.

2 Excluding €82.8 million in restricted cash and cash equivalents from the "Westville" subsidised loan.

3 Net financial debt = financial liabilities less cash and cash equivalents and term deposits. Exclusive of the €54.7 million subsidised loan.

4 Leverage = net financial debt / 12-month EBITDA adjusted.

5 Loan-to-cost = net financial debt / (inventories + contract assets).

6 Return on capital employed = LTM EBIT adjusted / (four-quarter average equity + net financial debt).

7 Average number of employees including trainees, interns and student trainees.

8 Full-time equivalents.

TABLE OF CONTENTS

4 REPORT ON THE GROUP'S POSITION

• 5 Results of operations, net assets and financial position
• 15 Project business at a glance
• 21 Risk and opportunities report
• 22 Outlook

23 CONSOLIDATED FINANCIAL STATEMENTS

• 24 Consolidated income statement
• 25 Consolidated statement of comprehensive income
• 26 Consolidated statement of financial position
• 28 Consolidated statement of cash flows
• 30 Segment reporting
• 32 Appendix (methods, addendum)

33 OTHER INFORMATION

• 34 Disclaimer
• 35 Quarterly comparison
• 36 Multi-year overview
• 37 Contact / Legal notice / Financial calendar

REPORT ON THE GROUP'S POSITION

• 5 Results of operations, net assets and financial position
• 15 Project business at a glance
• 21 Risk and opportunities report
• 22 Outlook

Report on the Group's position

Results of operations, net assets and financial position

Project business at a glance

Risk and opportunities report

Outlook

Consolidated financial statements

Other information

Results of operations, net assets and financial position

Results of operations

The following presentation of the adjusted results of operations reflects the business of the Instone Group, hereinafter also "Instone", which was largely influenced by project developments. The amendments to the adjusted results of operations in relation to the income statement are described in the segment reporting on page 30 .

Adjusted results of operations			TABLE 002
In millions of euros
	9M 2023	9M 2022	Change
Revenues adjusted	433.3	441.9	– 1.9%
Project costs adjusted	– 322.6	– 328.2	– 1.7%
Gross profit adjusted	110.7	113.8	– 2.7%
Gross profit margin adjusted	25.5%	25.8%
Platform costs adjusted	– 50.9	– 55.1	– 7.6%
Share of results of joint ventures adjusted	6.0	2.2	> 100%
Earnings before interest and tax (EBIT) adjusted	65.8	60.9	8.0%
EBIT margin adjusted	15.2%	13.8%
Financial result adjusted	– 12.6	– 11.6	8.6%
Earnings before tax (EBT) adjusted	53.2	49.3	7.9%
EBT margin adjusted	12.3%	11.2%
Income taxes adjusted	– 16.1	– 15.3	5.2%
Earnings after tax (EAT) adjusted	37.1	34.0	9.1%
EAT margin adjusted	8.6%	7.7%

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Revenue

Adjusted sales in the first 9 months of the 2023 financial year amounted to €433.3 million, around 2% below the figure from the previous year (previous-year period: €441.9 million). Despite a slight increase in construction activity compared to the same period last year, the decline in sales velocity compared to the same period last year led to a decline in revenue.

The adjustment of effects from purchase price allocations slightly increased the adjusted revenue by €2.5 million (previous-year period: €2.8 million). The separate measurement of share deals ("Westville" project) increased the adjusted revenue by €54.8 million (previous-year period: €32.6 million).

Revenue			TABLE 003
In millions of euros	9M 2023	9M 2022	Change
Revenue	376.0	406.6	– 7.5%
+ effects from purchase price allocations	2.5	2.8	– 10.7%
+ effects from share deal agreements	54.8	32.6	68.1%
Revenues adjusted	433.3	441.9	– 1.9%

Compared to the previous-year period, the increase in the revenue contribution of the "Westville" project was due in particular to the progress in construction on schedule in the reporting period under review.

The adjusted revenue of the Instone Group was almost exclusively generated in Germany and broken down across the following regions as follows:

Includes Maintal.

1

2 Includes Wiesbaden (€35.3 million), Bamberg (€13.0 million) and Potsdam (€7.8 million). 3 Includes Munich, Augsburg and Rosenheim. 4 Includes Rottenburg and Schorndorf. 5 Includes Nauen.

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Project costs

The adjusted project costs, mainly consisting of the cost of materials and changes in inventories, rose to €–322.6 million in the first 9 months of 2023 (previous-year period: €–328.2 million). Purchases of secured and paid-up land and the continuation of construction activities in previous years led to a slight increase in the cost of materials to €–402.8 million (previous-year period: €–400.5 million). The reported changes in inventories changed by €132.9 million (previous-year period: €97.7 million).

Indirect sales expenses of €–1.7 million during the reporting period were about the same as in the previous year (previous-year period: €–1.4 million). Other operating income after subtracting the cost of materials of €10.3 million (previous-year period: €5.5 million) was allocated to the adjusted project costs. The adjustment of the capitalised interest in the changes in inventories of €–8.9 million (previous-year period: €–1.5 million) added to the adjusted project costs. Effects from the amortisation of purchase price allocations reduced adjusted project costs by €1.9 million (previous-year period: €7.3 million). Due to the separate valuation of share deals, adjusted project costs again increased by €–54.3 million (previous-year period: €–35.3 million).

		Proiect cost

In millions of euros

	9M 2023	9M 2022	Change
Project costs	– 270.0	– 302.8	– 10.8%
+ effects from purchase price allocations	1.9	7.3	– 74.0%
+ effects from reclassifications	– 0.3	2.7	n/a
+ effects from share deal agreements	– 54.3	– 35.3	53.8%
Project costs adjusted	– 322.6	– 328.2	– 1.7%

Gross profit

Gross profit			TABLE 005
In millions of euros
	9M 2023	9M 2022	Change
Gross profit	106.0	103.8	2.1%
+ effects from purchase price allocations	4.5	10.1	– 55.4%
+ effects from reclassifications	– 0.3	2.7	n/a
+ effects from share deal agreements	0.5	– 2.7	n/a
Gross profit adjusted	110.7	113.8	– 2.7%
Gross profit margin adjusted	25.5%	25.8%

Due to revenue not meeting project costs, adjusted gross profit decreased in the reporting period to €110.7 million (previous-year period: €113.8 million).

The adjusted gross profit margin – calculated from the adjusted gross profit relating to the adjusted revenue – amounted to 25.5% (previous-year period: 25.8%).

Project costs Platform costs TABLE 004

Platform costs			TABLE 006
In millions of euros
	9M 2023	9M 2022	Change
Platform costs	– 45.4	– 51.0	– 11.0%
+ effects from reclassifications	– 8.6	– 4.1	> 100%
+ non recurring effects	3.1	0.0	n/a
Platform costs adjusted	– 50.9	– 55.1	– 7.6%

The adjusted platform costs, consisting of staff costs, other operating income and expenses and depreciation and amortisation fell to €–50.9 million (previous-year period: €–55.1 million). In the reporting period, €10.3 million in other operating income after subtracting the cost of materials (previous-year period: €5.5 million) and indirect sales costs of €–1.6 million (previous-year period: €–1.4 million) were reclassified in project costs. In addition, first-time non-recurring effects were adjusted by €3.1 million compared to the previous-year

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period. These mainly relate to expenses in connection with structural reorganisation measures amounting to €1.9 million.

At €–38.1 million, reported staff costs decreased slightly at –2.1% in the first 9 months of 2023 compared with the previous year's level (previous-year period: €–38.9 million). This is partly attributable to the reduction in the average number of employees to 475 (previous-year period: 493).

The reported other operating income, at €20.4 million (previous-year period: €12.9 million) was higher than last year. This included other operating income after subtracting the cost of materials of €10.3 million (previous-year period: €5.5 million), which were reclassified as project costs. Included in this are especially income from the realisation of grants of €9.3 million (previous-year period: €4.1 million). Income from the reversal of provisions for and liabilities relating to employees during the reporting period was €3.6 million (previous-year period: €3.4 million). In addition, income from the reversal of other provisions in the amount of €2.0 million was generated in the reporting period (previous-year period: €2.4 million). In addition, income of €2.8 million was reported from the deconsolidation of a subsidiary.

The reported other operating expenses increased to €–23.9 million in the reporting period (previous-year period: €–21.4 million), mainly due to increased expenses in connection with structural reorganisation measures. Other operating expenses mainly include consulting expenses, other taxes, sales costs, IT costs and court costs, attorneys' and notaries' fees.

The reported depreciation and amortisation was €–3.7 million (previous-year period: €–3.7 million) at the level of the previous year.

Share of results of joint ventures

The reported adjusted share of results of joint ventures of €6.0 million (previous-year period: €2.2 million) during the reporting period was attributable almost completely to construction activities and the sale of the Berlin joint venture Friedenauer Höhe, and reflects the expected development of this project.

Earnings before interest and tax (EBIT)

EBIT			TABLE 007
In millions of euros
	9M 2023	9M 2022	Change
EBIT	66.6	55.0	21.1%
+ effects from purchase price allocations	4.5	10.1	– 55.4%
+ effects from reclassifications	– 8.9	– 1.5	> 100%
+ non recurring effects	3.1	0.0	n/a
+ effects from share deal agreements	0.5	– 2.7	n/a
EBIT adjusted	65.8	60.9	8.0%
EBIT margin adjusted	15.2%	13.8%

Despite the decrease in adjusted gross profit, adjusted earnings before interest and tax increased mainly due to the greatly improved share of results of joint ventures and to decreased platform costs, to €65.8 million (previous-year period: €60.9 million).

Investment and financial result

As in the same period of the previous year, there was no materially adjusted income from investments in the reporting period.

The reported financial result fell in the reporting period to €–21.5 million (previous-year period: €–13.1 million). The increase in interest expenses was significantly attributable to the higher project-related new debt in the previous year and considerably increased interest rates.

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For the above reasons, the adjusted financial result fell to €–12.6 million. (previous-year period: €–11.6 million). In the reporting period, capitalised interest from project financing before the start of sales in the amount of €8.9 million (previous-year period: €1.5 million) was reclassified as adjusted project costs.

Earnings before tax (EBT)

Adjusted EBT rose mainly due to the greatly improved share of results of joint ventures and to decreased platform costs, to €53.2 million (previous-year period: €49.3 million).

EBT			TABLE 008
In millions of euros
	9M 2023	9M 2022	Change
EBT	45.1	41.9	7.6%
+ effects from purchase price allocations	4.5	10.1	– 55.4%
+ non recurring effects	3.1	0.0	n/a
+ effects from share deal agreements	0.5	– 2.7	n/a
EBT adjusted	53.2	49.3	7.9%
EBT margin adjusted	12.3%	11.2%

Income taxes

The tax rate in the adjusted results of operations in the first 9 months of 2023 was 30.2% (previous-year period: 31.0%). Tax effects from other periods essentially led to a decrease in the tax rate.

Income taxes in the reported result amounted to an expense of €–15.9 million (previous-year period: €–13.2 million).

Earnings after tax (EAT)

As a result of the effects mentioned above, the adjusted earnings after tax of the Instone Group totalled €37.1 million (previous-year period: €34.0 million).

Earnings after tax and after minority interests

Non-controlling interests in the adjusted earnings and reported earnings after tax amounted to €–0.3 million (previous-year period: €–1.0 million).

Earnings per share

1

Earnings per share			TABLE 009
In millions of euros
	9M 2023	9M 2022	Change
Shares (in thousands of units) 1	43,358.7	46,387.9	– 6.5%
Owners of the Company	29.5	29.7	– 0.7%
Earnings per share (in euros)	0.68	0.64	6.3%
Owners of the Company adjusted	37.5	35.0	7.1%
Earnings per share adjusted (in euros)	0.86	0.75	14.7%

Average weighted number of shares as at 30 September 2023 and 30 September 2022.

Adjusted earnings per share in the first half of 2023 were €0.86 (previous-year period: €0.75), an increase from the same period of the previous year.

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	Net assets

Condensed statement of financial position 1			TABLE 010
In millions of euros
	30/09/2023	31/12/2022	Change
Non-current assets	82.1	82.8	– 0.8%
Inventories	1,068.8	967.3	10.5%
Contract assets	235.0	333.6	– 29.6%
Other current assets	97.6	141.1	– 30.8%
Cash and cash equivalents and term deposits	259.8	255.6	1.6%
Assets	1,743.2	1,780.3	– 2.1%
Equity	585.3	573.0	2.1%
Liabilities from corporate finance	165.6	179.7	– 7.8%
Liabilities from project-related financing	338.5	341.0	– 0.7%
Provisions and other liabilities	653.8	686.7	– 4.8%
Equity and liabilities	1,743.2	1,780.3	– 2.1%

1 Items have been adjusted: Term deposits have been allocated to cash and cash equivalents due to short- to medium-term availability, and financial liabilities allocated on the basis of their use in corporate finance or project financing.

The total assets of the Instone Group increased to €1,743.2 million as at 30 September 2023 (31 December 2022: €1,780.3 million). Despite the increase in inventories and cash and cash equivalents, this is due in particular to the decline in contract assets and other current assets.

As at 30 September 2023, inventories had risen to €1,068.8 million (31 December 2022: €967.3 million). This increase in inventories is mainly the result of progress in the ongoing construction of unsold projects and of the purchase of land for future housing projects.

As at 30 September 2023, acquisition costs and incidental acquisition costs for land amounting to €701.9 million (31 December 2022: €690.4 million) were included in inventories.

Receivables from customers for work-in-progress (gross contract assets) already sold and valued at the current completion level of development rose to €851.0 million as at 30 September 2023 (31 December 2022: €847.9 million) due

Contract assets			TABLE 011
In millions of euros
	30/09/2023	31/12/2022	Change
Contract assets (gross)	851.0	847.9	0.4%
Payments received	– 619.2	– 519.6	19.2%
	231.8	328.3	– 29.4%
Capitalised costs to obtain a contract	3.2	5.3	– 39.6%
Contract assets (net)	235.0	333.6	– 29.6%

to the continuation of construction activities of residential real estate sold. Payments received from customers amounted to €619.2 million as at 30 September 2023 (31 December 2022: €519.6 million). The increase reflects the progress made in construction in the reporting period linked to upfront payments from customers.

The increase in trade receivables by €2.2 million to €5.0 million (31 December 2022: €2.8 million) resulted mainly from withholding upon transfer of a project.

The shares accounted for using the equity method, which also include investments in project companies, rose in the first 9 months of 2023 from €43.8 million to €49.6 million due to the construction progress of project developments in joint ventures.

The non-current financial receivables amounting to €17.1 million (31 December 2022: €19.0 million) includes borrowings from joint ventures and have decreased due to repayments.

The increase in current financial receivables of €20.3 million (31 December 2022: €0.7 million) relates mainly to a loan to a joint venture which was fully consolidated until and including May 2023.

Other current receivables and other assets decreased from €133.9 million to €68.0 million in the reporting period. A considerable share of these items consists largely of approved public grants of €51.8 million (31 December 2022: €86.7 million) for the construction of buildings, including the subsidies of the KfW efficiency programme. The majority of this change as at the reporting date is due to approved grants being reported in a different period for the purposes of

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accounting that is expected to occur between the start of sales and the start of construction. In addition, conversions of projects due to these changes were corrected according to the corresponding liabilities. To a lesser extent, the decrease of this item is also due to pledged public grants already being accepted.

The portfolio of cash and cash equivalents and term deposits in the amount of €259.8 million is slightly above the level at the end of the 2022 financial year (31 December 2022: €255.6 million).

Non-current financial liabilities increased to €363.7 million as at 30 September 2023 (31 December 2022: €292.0 million). Current financial liabilities decreased to €140.4 million in the same period (31 December 2022: €228.6 million). Due to a reduced net borrowing of financial loans in the reporting period, the total financial liabilities fell to €504.1 million (31 December 2022: €520.6 million).

The increase in other non-current liabilities to €28.1 million (31 December 2022: €0.0 million) was completely related to interest and repayment subsidy in connection with subsidised loans.

Trade payables fell during the first 9 months of 2023 to €135.2 million (31 December 2022: €150.4 million) and included the services provided by contractors. The reduction corresponded to the advance payments made to contractors during construction work.

The decrease in other current liabilities to €382.7 million (31 December 2022: €393.6 million) resulted mainly from the reduction in liabilities from public grants to €34.6 million (31 December 2022: €79.8 million). The development in public grants led mainly to a corresponding reduction in other receivables and assets. At the reporting date, the payments received for the "Westville" project amounted to €335.5 million (31 December 2022: €302.5 million).

The equity ratio as at 30 September 2023 was 33.6% (31 December 2022: 32.2%).

The share buyback programme announced on 10 February 2022 was terminated on 24 October 2022 with a total volume of €25.4 million. On 25 October 2022, Instone announced its intention to build on this with a new 5-month share buyback programme of up to €25.0 million. As at 30 September 2023, we have acquired shares worth €11.4 million with this new share buyback programme. As at 30 September 2023, the Company held 3,665,761 treasury shares. This corresponds to a share of 7.8% of the shares. As at 30 September 2023, the number of shares adjusted for the Company's treasury shares was therefore 43,322,575 shares.

Leverage (excluding the "Westville" subsidised loan) was unchanged compared with 31 December 2022, remaining at a moderate level in the opinion of the Management. Despite the slight increase in net debt, the improved result leads to a leverage at the same level as the previous year of 2.8 times (31 December 2022: 2.8 times) the adjusted EBITDA. The ratio of net debt to balance sheet inventories, contract assets and contract liabilities of 21.0% (31 December 2022: 20.8%) is also virtually unchanged.

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Net financial debt

and debt-to-equity ratio

In millions of euros

2

3

	30/09/2023	31/12/2022	Change
Non-current financial liabilities 1	309.1	292.0	5.9%
Current financial liabilities	140.4	228.6	– 38.6%
Financial liabilities	449.5	520.6	– 13.7%
– Cash and cash equivalents and term deposits 2	– 177.0	– 255.6	– 30.8%
Net financial debt (NFD)	272.5	265.1	2.8%
Inventories and contract assets / liabilities	1,297.7	1,275.0	1.8%
Loan-to-cost 3	21.0%	20.8%
EBIT adjusted (LTM 4)	93.5	88.6	5.5%
Depreciation and amortisation (LTM 4)	4.8	4.8	0.0%
EBITDA adjusted (LTM 4)	98.3	93.4	5.2%
Leverage (NFD / EBITDA adjusted [LTM ²])	2.8	2.8

1 Excluding financial liabilities of €54.7 million from the "Westville" subsidised loan.

Excluding €82.8 million in restricted cash and cash equivalents from the "Westville" subsidised loan. Loan-to-cost = net financial debt / (inventories + contract assets / liabilities). 4 LTM = last twelve months.

Financial position

TABLE 012

In the first 9 months of 2023, the nominal value of financial liabilities from corporate finance fell to €165.5 million (31 December 2022: €178.0 million). This resulted from the repayment of promissory note loans in the amount of €12.5 million. Utilisation of lines of project financing (excluding the "Westville" subsidised loan) decreased to €282.8 million (31 December 2022: €340.2 million) mainly due to the reduction of completed project financing and the simultaneous increase in the use of existing project financing. The total funding available (excluding the "Westville" subsidised loan), then amounting to €791.9 million (31 December 2022: €806.6 million) increased in the reporting period due to the conclusion of new classic project financing. As at 30 September 2023, cash and cash equivalents totalling €456.4 million (31 December 2022: €458.6 million) were available from project financing (excluding the "Westville" subsidised loan) and €335.5 million (31 December 2022: €348.0 million) from corporate finance. These corporate finance agreements contain financial key performance indicators that are described in the "Other disclosures" section of the notes in the 2022 annual report page 228.

In the balance sheet as at 30 September 2023, the liabilities from corporate finance amounted to €165.6 million (31 December 2022: €179.7 million) and liabilities from project-related financing (including the "Westville" subsidised loan) of €338.5 million (31 December 2022: €341.0 million). The recognised total liabilities from financing operations (including the "Westville" subsidised loan) thus increased to €504.1 million at the reporting date (31 December 2022: €520.6 million). The current project financing included in this is comprised of option agreements for extension.

The maturities of the non-discounted repayment amounts are as follows:

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Financial liabilities			TABLE 013
In millions of euros
Corporate finance (promissory notes)
	Due in	Credit amount
Term < 1 year	2024	15.5
Term > 1 and < 2 years	2025	100.0
Term > 3 years	2027	50.0
		165.5
Corporate finance (syndicated loans)			Utilisation
	Due in	Credit line	30/09/2023
Term < 1 year	2023 / 2024	18.3	0.0
Term > 1 and < 2 years	2024 / 2025	151.7	0.0
		170.0	0.0
Project financing			Utilisation
	Due in	Credit line	30/09/2023
Term < 1 year	2023 / 2024	133.4	122.7
Term > 1 and < 2 years	2024 / 2025	174.4	91.1
Term > 2 and < 3 years	2025 / 2026	91.0	11.4
Term > 3 years	> 2026	57.6	57.6
		456.4	282.8
Project financing (promotional loans for customers)			Utilisation 1
	Due in	Credit line	30/09/2023

1 This includes interest and repayment subsidy of €28.1 million that is recognised under other non-current liabilities.

Term > 3 years > 2026 199.0 82.8

199.0 82.8

Condensed statement of cash flows			TABLE 014
In millions of euros
	9M 2023	9M 2022	Change
Cash flow from operations	18.7	– 26.7	n/a
Cash flow from investing activities	4.4	9.3	– 52.7%
Free cash flow	23.1	– 17.4	n/a
Cash flow from financing activities	– 18.0	41.4	n/a
Cash change in cash and cash equivalents	5.1	24.0	– 78.8%
Cash and cash equivalents at the beginning of the period	255.6	131.0	95.1%
Other changes in cash and cash equivalents	– 1.0	0.0	n/a
Cash and cash equivalents at the end of the period	259.7	155.0	67.5%

The cash flow from operations of the Instone Group of €18.7 million in the first 9 months of 2023 (previous-year period: €–26.7 million) was mainly positively influenced by the payment inflows from transfers of projects with final payment. There was a reduction of liabilities to contractors for ongoing projects with simultaneous purchase price payments and land acquisition taxes for land totalling €10.2 million (previous-year period: €74.1 million). In addition, income tax payments amounting to €27.0 million were made in the reporting period (previous-year period: €2.9 million).

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Cash flow from operations	TABLE 015

In millions of euros

	9M 2023	9M 2022	Change
EBITDA adjusted	69.5	64.6	7.6%
Other non-cash items	– 3.7	– 12.7	– 70.7%
Taxes paid	– 27.0	– 2.9	n/a
Change in net working capital 1	– 20.1	– 75.6	– 73.4%
Cash flow from operations	18.7	– 26.7	n/a
Payments for land	10.2	74.1	– 86.2%
Cash flow from operations
without new investments	28.9	47.4	– 38.9%

¹ Net working capital is made up of inventories, contract assets and trade receivables, other receivables less contract liabilities and trade payables and other liabilities.

The operating cash flow, adjusted for payments for land, in the reporting period was positive, at €28.9 million (previous-year period: €47.4 million).

Cash flow from investing activities amounted to €4.4 million in the reporting period (previous-year period: €9.3 million). This mainly resulted from scheduled repayments of loans recognised in financial assets.

The cash flow from financing activities as at 30 September 2023 stood at €–18.0 million (previous-year period: €41.4 million). This was mainly due to the net take-up of financial loans in the amount of €22.4 million (previous-year period: €111.0 million net take-up), consisting of payments received from new financial loans taken up in the amount of €190.6 million and repayments for terminated financial loans in the amount of €–168.2 million. In the financial year, payments for interest amounting to €–18.4 million (previous-year period: €–15.9 million) and payments for the purchase of treasury shares of €–4.5 million (previous-year period: €–22.7 million) were included in the cash flow from financing activities. Furthermore, during the reporting period, dividends of €–15.2 million (previous-year period: €–28.7 million) were paid out.

As at 30 September 2023, cash and cash equivalents excluding term deposits increased to €259.8 million (30 September 2022: €155.0 million).

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Real estate business key performance indicators			TABLE 016
In millions of euros
		9M 2023	9M 2022
Volume of sales contracts 1		91.3	250.2
Volume of sales contracts	In units	175	486

		30/09/2023	31/12/2022
Project portfolio (existing projects) 2		7,015.5	7,668.8
Of which already sold		2,822.7	2,987.3
Project portfolio (existing projects)	In units	14,269	16,209
Of which already sold	In units	6,588	7,309

¹ Volume of sales contracts reflects the revenue-relevant (adjusted) volume of contracts of our projects. It mainly comprises all sales-related transactions, such as notarised real estate purchase agreements, individual orders from customers and rental income.

Volume of sales contracts is also referred to as sales volume.

² The portfolio value as at the reporting date is the anticipated overall volume of revenue from all projects listed in the project portfolio. Instone divides its project portfolio into three different groups depending on the stage of development: For projects with the status "pre-sale", the land has been already purchased, secured or claimed by us in a binding offer, but marketing has not yet begun. Following sales release and the initiation of marketing, projects are transferred to a "pre-construction" status. Projects with a completed start of construction have an "under construction" status until complete handover. Projects are removed from the portfolio the reporting month after all construction obligations have been fulfilled, the project has been sold (except when selling units individually, then once the percentage of units left to be sold is less than 2%) and handover is complete.

The development in the third quarter of 2023 was also driven by a persistently marked reluctance to buy as a result of the further increase in interest rates and the loss of purchasing power. This continues to be reflected in the below-average sales velocity of our unit sales projects compared to the long term, although a moderate recovery was recorded in the last quarter. With an offer for sale of 325 units at the beginning of the year and an increase in supply of 86 units, 76 units were sold in the first 9 months of the 2023 financial year.

With a volume of sales contracts of €52.1 million and 99 sales units, the somewhat greater share of sales successes in the reporting period was attributable to our institutional projects.

The sales volume of €91.3 million achieved in the first 9 months of 2023 of 175 sales units was substantially below the volume of sales contracts of €250.2 million (486 units) during the same period in the previous year, due to the macroeconomic conditions described in the introduction. This development remained in line with expectations which were reflected in the communicated 2023 forecast.

The marketing volume realised as at 30 September 2023 is divided about 50% between the most important metropolitan regions of Germany and further attractive, medium-sized cities.

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1 Mainly includes Bamberg, Potsdam and Wiesbaden. 2 Includes Berlin, Hamburg, Munich, North Rhine-Westphalia. The following projects mainly contributed to successful marketing in the 9M 2023 reporting period:

Real estate business key performance indicators – volume of sales contracts 9M 2023 TABLE 017

In millions of euros

50.8

Rest 1

		Volume	Units
Lagarde	Bamberg	n/a	99
Parkresidenz	Leipzig	24.9	53
Rote Kaserne West – "Fontane Gärten"	Potsdam	6.6	11
"Schönhof-Viertel" 1	Frankfurt / Main	4.6	2
Steinbacher Hohl 1	Frankfurt / Main	3.3	0
Wiesbaden-Delkenheim, Lange Seegewann 1 Wiesbaden		3.3	0
Seetor "City Campus"	Nuremberg	3.0	5
Stuttgart, City Prag 1	Stuttgart	1.6	0
Westville1	Frankfurt / Main	1.4	0
Heusenstamm	Heusenstamm	1.4	0

¹ Volume of sales contracts is (partially) the product of contractual revenue growth from existing purchase agreements.

The offer for sale of our individual sales projects on the market as at 30 September 2023 includes 340 units with an expected revenue volume of €218 million. Compared to the 2022 end-year value (325 units and €221 million), the current supply base is at a higher level in terms of the units offered, whilst the underlying expected revenue volume has fallen slightly.

The successful start of sales for two sub-projects of the "Parkresidenz" project with a total of 86 units contributed to the increase in the offer for sale of the individual sales properties in the reporting period, whilst the realised sales in individual sales of a total of 76 units resulted in a corresponding reduction in the offer for sale. We expect further sales launches in the fourth quarter of 2023.

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Development of the project portfolio, 30 September 2023

lion, representing a decrease from that of 31 December 2022 (€7,668.8 million). Completions include the projects "Niederkassel Lohweg" in Düsseldorf, "Amanda" in Hamburg and "Stephanstrasse" in Nuremberg.

Following change in control in the "Aukamm" joint venture, the company was deconsolidated in Q2 2023 and continues as a company using the equity method. According to our definition, this means the project is no longer in the project portfolio and is now included in the changes in revenue. We have also decided on a different strategy for three projects that gives preference to the resale of the properties without any construction. This results in an expected overall change in revenue of €–409 million.

There were no new approvals in the reporting period.

With regard to the volume of new approvals, we are also continuing to pursue the strategic approach of extremely selective investment activity, which was deliberately chosen in 2022. For example, no new project purchases have been made in the reporting period. We also expect attractive acquisition opportunities for projects of competitors with weaker financial resources in the changed interest rate and financing environment.

We have already realised adjusted revenues of €2,089.4 million from the current project portfolio, of which €768.2 millionhas already been handed over.

1 Aukamm converted to a joint venture company (accounted for under the equity method), so it is no longer in the portfolio.

As at 30 September 2023, Instone's project portfolio comprised 48 projects, from which we currently anticipate a total volume of sales contracts of €7,015.5 mil-

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As at 30 September 2023, the expected project gross profit margin for the project portfolio without taking into account the "Westville" project in Frankfurt /Main is about 22.5%. ¹

¹ If the large "Westville" project is taken into consideration, the expected project gross profit margin for the project portfolio is about 21.6%.

Project portfolio by region, 30 September 2023 In % Hamburg 4.6 34.1 Frankfurt / Main 1 2.1 Berlin 5 21.2 North Rhine-Westphalia Nuremberg 9.0 Rest 2 12.4 Stuttgart 3 7.8 Leipzig 4.7 4.1 Munich 4 €7.0 billion 14,269 units 48 projects

1 Includes Maintal, Hofheim and Heusenstamm. 2 Includes Wiesbaden, Bamberg and Potsdam. 3 Includes Rottenburg, Herrenberg and Schorndorf. 4 Includes Munich, Augsburg and Rosenheim. 5 Includes Nauen.

The majority – approximately 88% – of the anticipated overall volume of revenue from the project portfolio as at 30 September 2023 is located in the most important metropolitan regions of Germany: Berlin, Bonn, Düsseldorf, Frankfurt /Main, Hamburg, Cologne, Leipzig, Munich, Nuremberg and Stuttgart. Around 12% is attributable to other attractive medium-sized cities.

Internal sector:

Sold Unsold

1 10.3% of the project portfolio has already been handed over. These projects are included in "under construction". 2 0.6% of the volume have already been transferred. These projects are included in "pre-construction". 3 7.8% of the volume are in the status of land acquisition. These projects are included in "pre-sale".

Given our project portfolio's continued growth in recent years, the conscious decision to take an extremely selective approach to starting sales in the current macroeconomic environment and the on-going completion of sold projects, most of our current projects are in the "pre-sale" development stage.

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As at 31 December 2022, 41.3% of the project portfolio were in "under construction", 2.2% in "pre-construction" and 56.4% in "pre-sale". Based on the shifts in the project portfolio described above as at 30 September 2023, 43.6% were in the category "under construction", 1.7% were in "pre-construction" and 54.8% were in "pre-sale".

In addition, the preceding diagram shows that, as at 30 September 2023 we had already sold approximately 40% of the anticipated overall revenue volume of the project portfolio. In terms of the anticipated revenue volume from "under construction" and "pre-construction" projects, approximately 89% of projects had been sold as at 30 September 2023.

In addition to the 48 projects, Instone's project portfolio will be supplemented by four further projects that will be realised in joint ventures. Overall, a total volume of sales of around €1.3 billion (Instone share approx. €650 million) and the development of approximately 2,100 residential units was expected for these projects consolidated using the equity method.

With an offer for sale of 95 units at the beginning of the year, it was possible to implement the sale of 19 units in unit sales in the "Friedenauer Höhe" project during the reporting period.

Adjusted revenue

In the reporting period, we achieved adjusted revenue of €433.3 million (previous year: €–441.9 million). The following projects contributed significantly to the adjusted revenue:

Key projects revenue realisation (adjusted) 9M 2023	TABLE 018
In millions of euros
	Revenue volume (adjusted)

"Schönhof-Viertel"	Frankfurt / Main	103.0
Westville	Frankfurt / Main	54.9
Parkresidenz	Leipzig	41.0
Wiesbaden-Delkenheim	Wiesbaden	35.3
Beethovenpark ("Augusta and Luca")	Augsburg	29.8
"Wohnen im Hochfeld" Unterbach	Düsseldorf	23.2
Rothenburgsort	Hamburg	22.8
"Neckar.Au Viertel"	Rottenburg	16.6
Literaturquartier	Essen	13.7
Lagarde	Bamberg	13.0

The building blocks of success for realising the adjusted revenues were steady marketing progress and a further development process in the structural implementation of our projects. For this reason, in addition to the marketing progress achieved, progress in the projects under construction, in particular, have contributed to the generation of revenue.

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During the reporting period, construction has begun on a total of three projects: the "Fuchsgärten" units in Nuremberg-Boxdorf and two sub-projects in the "Lagarde" project in Bamberg.

The "Fuchsgärten" units on Erich-Ollenhauer-Strasse/corner of Rotfuchsstrasse offer suitable residential concepts for different target groups. The eight multioccupancy buildings with 102 freehold apartments comprise living areas of 37–140 m² divided into one to four rooms. Each apartment comes with its own balcony, a terrace or a roof terrace. There are also 13 town houses under construction, each with four rooms and 105m² or 120m² of living space on multiple storeys and each with its own garden plot. Additionally, 122 underground car park spaces and the preliminary setup for EV charging stations are planned. All apartments are constructed to the BEG efficiency standard 55 EE and are equipped with modern wood pellet heating systems. Only renewable energies are used for heating, meaning the units are heated independently of fossil fuels.

Around 5,300 units are currently in the construction phase at the same time. The situation around material and supply bottlenecks has stabilised and is currently at a level last seen prior to Ukraine crisis.

In the reporting period, a total of 1,192 units were successfully handed over, including 459 residential units of the micro-apartment residential complex in "Stephanstrasse" in Nuremberg. It consists of three interconnected buildings with up to seven storeys and is located on a plot of about 4,450 m², which comprises a total living area of about 9,800 m². The 459 high-quality furnished micro-apartments are mostly disabled-accessible and offer space for a total of 466 beds. The majority are one-bedroom apartments with 19–25 m² of living space, individual two- and three-bedroom apartments with approx. 35 m² of living space and a single five-bedroom apartment, which is approx. 100 m² in size. On the ground floor, 840 m² of commercial space and 75 underground parking spaces are planned. All residential units meet the KfW Efficiency House 55 standard. Integrated into the natural urban environment, the property also offers green roofs and a well-designed open space concept for the surrounding green spaces and planting areas.

The residential part of the "City-Prag" project in Stuttgart, comprising 251 residential units and a living area of around 18,000 m², was also handed over.

The sub-project "DUS 19" of the "Wohnen im Hochfeld" project in Düsseldorf, comprising 66 largely subsidised residential units, was also successfully handed over. "DUS 19" offers an attractive, modern living space with a total living area of around 5,050 m². Also completed were three identical three-storey buildings containing two- and three-bedroom apartments plus a penthouse. This project is in an attractive location in close proximity to Lake Unterbach and with good access to the Düsseldorf city centre.

All developments in what is a challenging market environment and in our projects were monitored closely and compensated for as far as possible by making the appropriate adjustments to the relevant processes, which is underlined by our gross margin.

The completed projects of Instone's project portfolio continue to have a high sales ratio of about 95%.

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At Instone, risk and opportunities management is an integral part of the Group-wide system of corporate governance. For a detailed overview of our risk and opportunities management processes as well as the risk and opportunities situation, please refer to the "Risk and opportunities report" shown in the combined management report on pages 150–167 of the 2022 Annual Report.

There was no material change in the risk and opportunities situation in comparison to our presentation in the 2022 Annual Report.

The risk and opportunities situation is continuously monitored, assessed and, if necessary, incorporated into the ongoing forecast. From the current perspective, there were no identifiable risks that could jeopardise the continued existence of the Instone Group.

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Our forecast for business development for 2023, which we announced with the publication of the 2022 annual report in March 2023, continues to be confirmed.

The Management Board now expects the financial and operating performance indicators to develop as follows:

Forecast	TABLE 019
In millions of euros
	2023
Adjusted revenue	600 – 700
Adjusted gross profit margin	~ 25%
Adjusted earnings after tax	40 – 50
Volume of sales contracts	> 150

The forecast is based, among other things, on a historically lower speed of sales of our unit sales projects and a sustained reluctance on the part of institutional investors as a result of the significant rise in interest rates.

CONSOLIDATED FINANCIAL STATEMENTS

• 24 Consolidated income statement
• 25 Consolidated statement of comprehensive income
• 26 Consolidated statement of financial position
• 28 Consolidated statement of cash flows
• 30 Segment reporting
• 32 Appendix (methods, addendum)

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Consolidated income statement

In thousands of euros 01/01 – 30/09/2023 Revenue 375,969 Changes in inventories 132,864 508,833 Other operating income 20,406 Cost of materials – 402,846 Staff costs – 38,067 Other operating expenses – 23,947 Depreciation and amortisation – 3,749 Consolidated earnings from operating activities 60,630 Share of results of joint ventures 5,996 Other results from investments 0 Finance income 3,996 Finance costs – 25,674 Other financial result 182 Consolidated earnings before tax (EBT) 45,129 Income taxes – 15,916 Consolidated earnings after tax (EAT) 29,213	TABLE 020	Consolidated income statement
	01/01 – 30/09/2022
	406,601
	97,693
	504,294
	12,935
	– 400,537
	– 38,866
	– 21,363
	– 3,694
	52,769
	2,218
	33
	677
	– 13,516
	– 267
	41,915
	– 13,227
	28,688
Attributable to:
Shareholders of the Company 29,538	29,704
Non-controlling interests – 325	– 1,017
Weighted average number of shares (in units) 43,358,700	46,387,893
Basic and diluted earnings per share (in €) 0.68	0.64

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Consolidated statement of comprehensive income

Consolidated statement of comprehensive income		TABLE 021
In thousands of euros
	01/01 – 30/09/2023	01/01 – 30/09/2022
Consolidated earnings after tax	29,213	28,688
Items which will not be reclassified into the consolidated earnings in future periods
Actuarial gains and losses	255	421
Income tax effects	– 81	– 134
Income and expenses after tax recognised directly in equity	174	288
Total comprehensive income for the financial year after tax	29,387	28,975
Attributable to:
Shareholders of the Company	29,712	29,992
Non-controlling interests	– 325	– 1,017
	29,387	28,975

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Consolidated statement of financial position		TABLE 022
In thousands of euros
	30/09/2023	31/12/2022
ASSETS
Non-current assets
Goodwill	6,056	6,056
Intangible assets	405	940
Right-of-use assets	6,857	7,580
Property, plant and equipment	1,194	1,721
Interests in joint ventures	49,597	43,754
Other investments	347	340
Financial receivables	17,050	18,993
Other receivables	249	311
Deferred tax	381	3,078
	82,136	82,774
Current assets
Inventories	1,068,786	967,253
Right of use assets	3,031	3,031
Financial receivables	20,332	663
Contract assets	234,984	333,585
Trade receivables	4,999	2,778
Other receivables and other assets	68,013	133,949
Income tax assets	1,109	710
Cash and cash equivalents	259,848	255,592
	1,661,103	1,697,561
TOTAL ASSETS	1,743,238	1,780,335

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Consolidated statement of financial position (continued)

Consolidated statement of financial position		TABLE 022
In thousands of euros
	30/09/2023	31/12/2022
EQUITY AND LIABILITIES
Equity
Share capital	46,988	46,988
Capital reserves	358,983	358,983
Group retained earnings / loss carryforwards	212,497	198,123
Accumulated reserves recognised in other comprehensive income	1,929	1,755
Treasury shares at acquisition costs	– 36,697	– 32,139
Equity attributable to shareholders	583,700	573,710
Non-controlling interests	1,627	– 753
	585,327	572,957
Non-current liabilities
Provisions for pensions and similar obligations	0	128
Other provisions	3,303	3,342
Financial liabilities	363,791	292,025
Liabilities from net assets attributable to non-controlling interests	19	18
Leasing liabilities	6,970	7,359
Other liabilities	28,082	0
Deferred tax	48,983	50,314
	451,147	353,185
Current liabilities
Other provisions	18,191	21,929
Financial liabilities	140,358	228,622
Leasing liabilities	3,319	3,581
Contract liabilities	6,046	25,878
Trade payables	135,212	150,450
Other liabilities	382,723	393,559
Income tax liabilities	20,915	30,175
	706,765	854,193
TOTAL EQUITY AND LIABILITIES	1,743,238	1,780,335

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Consolidated statement of cash flows		TABLE 023
In thousands of euros
	01/01 – 30/09/2023	01/01–30/09/2022
Consolidated earnings after tax	29,213	28,688
(+) Depreciation and amortisation / (–) reversal of impairments of property, plant and equipment	3,749	3,694
(+) Profit / (–) Loss on disposals of property, plant and equipment	1	4
(+) Increase / (–) Decrease in provisions	– 44	– 4,666
(+) Current income tax income / (–) current income tax expense	17,337	15,880
(+) Deferred income tax income / (–) deferred income tax expense	– 1,411	– 2,653
(+) Expenses / (–) income from investments / joint ventures accounted for under the equity method	– 5,996	– 2,218
(+/–) Change in net assets attributable to non-controlling interests	0	– 30
(+) Interest expenses / (–) interest income	21,497	13,105
(+) Proceeds from government grants	1,398	0
(+/–) Change in net working capital 1	– 20,054	– 75,603
(+) Income tax reimbursements / (–) income tax payments	– 26,995	– 2,928
= Cash flow from operations	18,695	– 26,727
(–) Outflows for investments in intangible assets	0	– 12
(+) Proceeds from disposals of property, plant and equipment	0	18
(–) Outflows for investments in property, plant and equipment	– 31	– 448
(+) Proceeds from disposals of investments	8,729	7738
(–) Outflows for investments in financial assets	– 7,232	– 8,774
(+) Proceeds from disposals of unconsolidated companies and other companies	0	3
(–) Outflows for investments in unconsolidated companies and other companies	0	– 9,196
(+) Proceeds due to financial investments within the scope of current financial planning	0	80,000
(–) Outflows due to financial investments within the scope of current financial planning	0	– 60,000
(+) Interest received	3,039	0
= Cash flow from investing activities	4,505	9,328

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Consolidated statement of cash flows (continued)

Consolidated statement of cash flows		TABLE 023
In thousands of euros
	01/01 – 30/09/2023	01/01–30/09/2022
(–) Acquisition of treasury shares	– 4,548	– 22,679
(–) Payments for transaction costs of the issued capital	– 10	0
(+) Contributions from minority shareholders	0	507
(+) Proceeds from loans and borrowings 2	190,638	255,302
(–) Repayments of loans and borrowings	– 168,192	– 144,257
(–) Payments from lessees to repay liabilities from lease agreements	– 2,274	– 2,802
(–) Interest paid	– 18,408	– 15,933
(–) Dividends paid	– 15,163	– 28,750
= Cash flow from financing activities	– 17,958	41,388
Cash and cash equivalents at the beginning of the period	255,592	130,969
(+/–) Change in cash and cash equivalents	5,243	23,989
(+/–) Exchange rate, scope of consolidation and valuation-related changes in cash and cash equivalents	– 987	0
= Cash and cash equivalents at the end of the period	259,848	154,957

1 Net working capital is made up of inventories, contract assets and trade receivables, other receivables less contract liabilities and trade payables and other liabilities.

2 Including proceeds from subsidised loans amounting to €82,840 thousand. Of this, €54,758 thousand is reported as financial liabilities and €28,082 thousand as other non-current liabilities.

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Reconciliation of adjusted results of operations 01/01 – 30/09/2023

In thousands of euros

	Adjusted results of operations	Share deal effects	Non recurring effects	Reclassifications	Effects from PPA	Reported results of operations
Revenue	433,317	– 54,817	0	0	– 2,531	375,969
Project costs	– 322,636	54,273	0	316	– 1,936	– 269,982
Cost of materials	– 394,220	0	0	– 8,626	0	– 402,846
Changes in inventories	71,584	54,273	0	8,942	– 1,936	132,864
Gross profit	110,682	– 544	0	316	– 4,467	105,987
Platform costs	– 50,902	0	– 3,081	8,626	0	– 45,357
Staff costs	– 38,067	0	0	0	0	– 38,067
Other operating income	10,130	0	0	10,275	0	20,406
Other operating expenses	– 19,217	0	– 3,081	– 1,649	0	– 23,947
Depreciation and amortisation	– 3,749	0	0	0	0	– 3,749
Share of results of joint ventures	5,996	0	0	0	0	5,996
EBIT	65,776	– 544	– 3,081	8,942	– 4,467	66,626
Financial result	– 12,555	0	0	– 8,942	0	– 21,497
EBT	53,221	– 544	– 3,081	0	– 4,467	45,129
Tax	– 16,089					– 15,916
EAT	37,132					29,213

TABLE 024

TABLE 025

Key indicators

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RECONCILIATION OF ADJUSTED RESULTS OF OPERATIONS 01/01 – 30/09/2022

In thousands of euros

	Adjusted results of operations	Share deal effects	Reclassifications	Effects from PPA	Reported results of operations
Revenue	441,913	– 32,553	0	– 2,759	406,601
Project costs	– 328,151	35,252	– 2,650	– 7,294	– 302,843
Cost of materials	– 396,403	0	– 4,134	0	– 400,537
Changes in inventories	68,252	35,252	1,484	– 7,294	97,693
Gross profit	113,762	2,699	– 2,650	– 10,053	103,757
Platform costs	– 55,123	0	4,134	0	– 50,989
Staff costs	– 38,866	0	0	0	– 38,866
Other operating income	7,400	0	5,535	0	12,935
Other operating expenses	– 19,962	0	– 1,401	0	– 21,363
Depreciation and amortisation	– 3,694	0	0	0	– 3,694
Share of results of joint ventures	2,218	0	0	0	2,218
EBIT	60,858	2,699	1,484	– 10,053	54,987
Other results from investments	33	0	0	0	33
Financial result	– 11,621	0	– 1,484	0	– 13,105
EBT	49,269	2,699	0	– 10,053	41,915
Tax	– 15,253				– 13,227
EAT	34,016				28,688

Report on the Group's position

Consolidated financial statements

Consolidated income statement

Consolidated statement of comprehensive income

Consolidated statement of financial position

Consolidated statement of cash flows

Segment reporting

Appendix (methods, addendum)

Other information

Appendix (methods, addendum)

Basis of the interim consolidated financial statements

For the interim consolidated financial statements as at 30 September 2023, the accounting policies applied when preparing the consolidated financial statements as at 31 December 2022 were generally adopted without change.

The consolidated financial statements for Instone as at 31 December 2022 were prepared on the reporting date on the basis of section 315e(1) HGB in accordance with the International Financial Reporting Standards (IFRS) of the International Accounting Standards Board (IASB) and the related Interpretations (IFRIC) of the IFRS Interpretations Committee (IFRS IC) as they apply in accordance with Regulation No 1606/2002 of the European Parliament and of the Council on the application of international accounting standards in the European Union.

The interim consolidated financial statements are prepared in euros, which is the functional currency and the reporting currency of the Group. All amounts are expressed in thousands of euros (€ thousand) unless stated otherwise. Commercial rounding may lead to immaterial rounding differences in the totals.

Events after the balance sheet date

There were no events of particular significance to report after the balance sheet date of 30 September 2023.

OTHER INFORMATION

• Disclaimer
• Quarterly comparison
• Multi-year overview
• Contact / Legal notice / Financial calendar

Report on the Group's position

Consolidated financial statements

Other information

Disclaimer

Quarterly comparison

Multi-year overview

Contact / Legal notice / Financial calendar

Disclaimer

Forward-looking statements

This condensed consolidated interim report contains forward-looking statements that are based on current management plans, goals and forecasts. However, these statements relate only to findings that are available as at the date this condensed consolidated interim report was prepared. Management does not guarantee that these forward-looking statements will necessarily materialise. Actual future development and the results actually achieved are subject to various risks and can therefore deviate significantly from the forward-looking statements. Several risk factors cannot be influenced by Instone Real Estate and therefore cannot be conclusively assessed in advance. These include changes in the economic and competitive environment, legislation, fluctuations in interest or exchange rates, legal disputes and investigative proceedings and the availability of financial resources. These and other risks are listed in the 2022 consolidated report, which includes a summary of the management report, as well as in this condensed consolidated interim report. Furthermore, business development and economic results may also be encumbered by other factors. Following publication of this interim consolidated report, there is no intention to in any way update the forward-looking statements made herein or to adjust them to events and developments.

Rounding of figures

Some figures disclosed in this condensed consolidated interim report have been commercially rounded. As a result, there may be minor deviations between figures in tables and the respective analyses of them in the text of the condensed consolidated interim report, as well as between individual amount totals in tables and the total values indicated in the text. All key performance indicators and percentage changes are calculated on the basis of the underlying data and shown in the unit "thousands of euros".

Report on the Group's position

Consolidated financial statements

Other information

Disclaimer

Quarterly comparison

Multi-year overview

Contact / Legal notice /
Financial calendar

Quarterly comparison								TABLE 026
In millions of euros
		Q3 2023	Q2 2023	Q1 2023	Q4 2022	Q3 2022	Q2 2022	Q1 2022
Real estate business key performance indicators
Volume of sales contracts		20.2	18.4	52.7	41.9	104.6	58.0	87.6
Volume of sales contracts	In units	37	28	110	44	199	96	191
Project portfolio (existing projects)		7,015.5	7,182.6	7,600.4	7,668.8	7,827.4	7,727.4	7,567.7
Of which already sold		2,822.7	2,868.8	2,958.7	2,980.5	2,945.4	2,891.4	3,070.1
Project portfolio (existing projects)	In units	14,269	15,148	16,107	16,209	16,580	16,644	16,607
Of which already sold	In units	6,588	7,017	7,198	7,309	7,265	7,179	7,404
Volume of new approvals 1		0.0	0.0	0.0	0.0	51.4	185.5	99.8
Volume of new approvals	In units	0	0	0	0	114	461	174
Cash flow from operations		59.1	34.3	– 74.7	96.9	– 46.2	32.1	– 12.7
Adjusted results of operations
Revenues adjusted		153.8	156.0	123.5	179.1	173.9	149.5	118.5
Project costs adjusted		– 115.3	– 117.6	– 89.7	– 135.6	– 129.0	– 115.9	– 83.3
Gross profit adjusted		38.5	38.4	33.8	43.4	45.0	33.6	35.2
Gross profit margin adjusted		25.0%	24.6%	27.4%	24.2%	25.9%	22.5%	29.7%
Platform costs adjusted		– 17.9	– 13.7	– 19.3	– 17.4	– 20.7	– 15.7	– 18.7
Share of results of joint ventures adjusted		1.9	2.8	1.3	1.7	0.7	0.9	0.6
Earnings before interest and tax (EBIT) adjusted		22.5	27.5	15.8	27.7	25.0	18.9	17.0
EBIT margin adjusted		14.6%	17.6%	12.8%	15.5%	14.4%	12.6%	14.3%
Income from investments adjusted		0.0	0.0	0.0	0.0	0.0	0.0	0.0
Financial result adjusted		– 2.6	– 6.6	– 3.4	– 4.3	– 4.1	– 3.8	– 3.7
Earnings before tax (EBT) adjusted		19.9	20.9	12.4	23.4	20.8	15.1	13.4
EBT margin adjusted		12.9%	13.4%	10.0%	13.1%	12.0%	10.1%	11.3%
Income taxes adjusted		– 6.7	– 5.5	– 3.9	– 7.3	– 6.4	– 4.8	– 4.1
Earnings after tax (EAT) adjusted		13.2	15.4	8.5	16.0	14.4	10.3	9.3
EAT margin adjusted		8.6%	9.9%	6.9%	8.9%	8.3%	6.9%	7.8%
Earnings per share (adjusted)	In euros	0.30	0.36	0.20	0.35	0.32	0.24	0.20

Key indicators	Multi-year overview												TABLE 027
Report on the	In millions of euros	9M 2023	2022	2021	2020	2019	In millions of euros		9M 2023	2022	2021	2020	2019
Group's position	Key liquidity figures						Real estate business key performance indicators
Consolidated financial statements	Cash flow from operations	18.7	70.2	43.9	119.9	– 205.1	Volume of sales contracts		91.3	292.1	1,140.1	464.4	1,403.1
	Cash flow from operations without new investments	28.9	187.2	256.3	225.0	115.0	Volume of sales contracts	In units	175	530	2,915	1,292	2,733
Other information	Free cash flow	23.1	79.6	167.4	– 64.2	– 237.5	Project portfolio (existing projects)		7,015.5	7,668.8	7,500.0	6,053.6	5,845.7
Disclaimer	Cash and cash equivalents and term deposits 1	177.0	255.6	151.0	232.0	117.1	Of which already sold		2,822.7	2,980.5	3,038.9	2,328.8	2,174.0
Quarterly comparison							Project portfolio (existing projects)	In units	14,269	16,209	16,418	13,561	13,715
	Key balance sheet figures						Of which already sold	In units	6,588	7,309	7,215	5,381	4,814
Multi-year overview	Total assets	1,743.2	1,780.3	1,520.8	1,283.1	1,123.4	Volume of new approvals6		0.0	336.7	1,587.4	489.9	1,284.2
	Inventories	1,068.8	967.3	843.7	777.8	732.1	Volume of new approvals	In units	0	749	3,245	1,171	3,857
Contact / Legal notice /	Contract assets	235.0	333.6	358.0	194.2	219.0
Financial calendar	Equity	585.3	573.0	590.9	521.0	310.2	Adjusted results of operations
	Financial liabilities	504.1	520.6	390.5	481.7	595.5	Revenues adjusted		433.3	621.0	783.6	480.1	736.7
	From corporate finance	165.5	179.7	199.1	207.2	180.8	Project costs adjusted		– 322.6	– 463.8	– 562.1	– 333.5	– 548.8
	From project financing	338.5	341.0	191.4	274.5	414.7	Gross profit adjusted		110.7	157.2	221.5	146.6	187.8
							Gross profit margin adjusted		25.5%	25.3%	28.3%	30.5%	25.5%
	Net financial debt 2	272.5	265.1	239.5	249.7	478.4	Platform costs adjusted		– 50.9	– 72.5	– 80.5	– 65.5	– 59.0
	Leverage	2.8	2.8	1.5	2.8	3.6	Share of results of joint ventures adjusted		6.0	3.9	14.6	2.7	0.7
	Loan-to-cost 3 In %	0.2	20.8	20.1	25.7	50.3	Earnings before interest and tax (EBIT) adjusted		65.8	88.6	155.7	83.8	129.6
	ROCE 4 adjusted In %	10.8	10.2	22.0	10.3	22.8	EBIT margin adjusted		15.2%	14.3%	19.9%	17.5%	17.6%
							Income from investments adjusted		0.0	0.0	0.1	– 1.2	– 5.7
	Employees						Financial result adjusted		– 12.6	– 15.9	– 19.3	– 23.2	– 16.1
	Number	475	488	457	413	375	Earnings before tax (EBT) adjusted		53.2	72.7	136.5	59.4	107.8
	FTE 5	392.2	409.4	387.6	342.5	307.7	EBT margin adjusted		12.3%	11.7%	17.4%	12.4%	14.6%
							Income taxes adjusted		– 16.1	– 22.6	– 39.6	– 18.3	– 2.2
	1 Term deposits are comprised of cash investments of more than three months. Excluding restricted cash equivalents of €82.8 million from the subsidised loan "Westville". 2 Net financial debt = financial liabilities less cash and cash equivalents and term deposits.						Earnings after tax (EAT) adjusted		37.1	50.0	96.9	41.1	105.6
						EAT margin adjusted		8.6%	8.1%	12.4%	8.6%	14.3%
	3 Loan-to-cost = net financial debt / (inventories + contract assets). 4 Return on capital employed = LTM EBIT adjusted / (four-quarter average equity + net financial debt).						Earnings per share (adjusted)	In euros	0.86	1.11	2.10	0.99	2.69
	5 Full-time equivalents.						Dividend per share	In euros	0.00	0.35	0.62	0.26	0.00
	6 Excluding volume of approvals from joint ventures consolidated at equity.						Distribution amount		0.0	15.2	28.7	12.2	0.0

Report on the Group's position

Consolidated financial statements

Other information

Disclaimer

Quarterly comparison

Multi-year overview

Contact / Legal notice / Financial calendar

Contact

Business Development & Communication

Burkhard Sawazki

Instone Real Estate Group SE Grugaplatz 2– 4, 45131 Essen, Germany

Telephone: +49 201 45355-137 Fax: +49 201 45355-904 Email: burkhard.sawazki@instone.de

Legal notice

Instone Real Estate Group SE

Grugaplatz 2 – 4 45131 Essen, Germany Germany

Telephone: +49 201 45355-0 Fax: +49 201 45355-934 Email: info@instone.de

Management Board

Kruno Crepulja (Chair of the Management Board/CEO), David Dreyfus, Andreas Gräf

Chairman of the Supervisory Board

Stefan Brendgen

Commercial Register

Registered in the Commercial Register of the Essen District Court under HRB 32658

Sales tax ID number DE 300512686

Concept, design and implementation

RYZE Digital www.ryze-digital.de

Financial calendar

21 March 2024	Publication of the financial report for the year ended 31 December 2023
9 May 2024	Publication of the quarterly statement as at 31 March 2024
8 August 2024	Publication of the semi-annual report as at 30 June 2024
7 November 2024	Publication of the quarterly statement as at 30 September 2024

Instone Real Estate Group SE

Grugaplatz 2 – 4 45131 Essen Germany

Email: info@instone.de www.instone.de