Fair Value REIT-AG

Earnings Release • Feb 22, 2010

News Details

Corporate | 22 February 2010 07:39

Fair Value REIT-AG announces preliminary results for 2009

Fair Value REIT-AG / Preliminary Results/Final Results

22.02.2010 07:39

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Fair Value REIT-AG announces preliminary results for 2009

• Adjusted consolidated net income (acc. EPRA) beat forecasts

• Occupancy rate up on previous year

• Fall in income due to valuations leads to net group loss

Munich, February 22, 2010 - Fair Value REIT-AG has recorded an adjusted
consolidated net income of EUR 5 million (previous year EUR 5.9 million)
according to the preliminary figures for the 2009 financial year. This
result (acc. EPRA) is adjusted to take into account changes in the market
value of property and interest derivatives as well as other one-off effects
and is slightly higher than the recently lifted forecast of between EUR 4.5
and 4.8 million.

During the past fiscal year, the Group's rental income amounted to EUR 10.5
million (previous year: EUR 12.4 million). This includes rental income from
directly owned property as well as the closed-end real estate funds, in
which Fair Value REIT-AG held the majority of shares over the year. At the
same time, the 'at equity' accounted holding companies achieved rental
income of EUR 35.8 million, i.e. the same level as the previous year.
According to Fair Value REIT-AG's share in the overall portfolio, the
rental income totalled EUR 20.2 million (previous year: EUR 21.7 million).
The drop in rental income and the figures detailed below result primarily
from the sale of an office building and the termination of a general lease
contract in return for a compensation payment.

Occupancy rates have increased to 95.5% of the potential rent as of
December 31, 2009, up from 94.9 % in the previous year, as a result of
active rental management. The residual term of the rental contracts was 6.3
years at the end of fiscal year 2009, in contrast to 6.9 years at the end
of the previous year.

During the reporting period, Fair Value REIT-AG realised operational cash
flow at the Group level (funds from operations, FFO) of EUR 2.7 million, or
EUR 0.29 per share (previous year: EUR 3.5 million). On the balance sheet
date, the Group's liquid funds totalled EUR 8.2 million (previous year: EUR
14 million). The fall in liquidity from the previous year by EUR 5.5
million is due to the repayment of financial liabilities by the amount of
EUR 8.2 million.

According to preliminary figures, Fair Value REIT-AG registered a valuation
related consolidated loss of EUR 4.1 million according to IFRS accounting
principles in fiscal year 2009 (previous year's loss: EUR 13.1 million).
This included a one-off expenditure of EUR 0.3 million as a severance
payment to a board member who left the company.

The market value of the derivative financial instruments placed a burden of
EUR 4.9 million on the Group's equity on the balance sheet. In the previous
year, the number had totalled EUR 4.2 million. On the basis of a property
valuation carried out by an independent surveyor, the increased
requirements of property investors for returns resulted on balance in a 3.3
% proportionate loss for Fair Value holdings to EUR 236.5 million as of
December 31, 2009, despite increases in the market value of individual
properties. The percentage change, however, improved by 50% in comparison
with the previous year.

With a consolidated balance sheet total of EUR 203 million (previous year:
EUR 198 million), Group equity on the balance sheet date equalled EUR 71.4
million (previous year: EUR 76.8 million). This corresponds to a balance
sheet NAV of EUR 7.64 for each share in circulation (previous year: EUR
8.16). The EPRA-NAV (balance sheet NAV plus market value of derivative
financial instruments) per share is EUR 8.15 (previous year: EUR 8.61). In
terms of § 15 REIT-G, equity including the minority share holdings worth
EUR 15.2 million, totalled EUR 86.6 million, corresponding to 45.1% of the
immovable assets.

Frank Schaich, Chief Executive Officer of Fair Value REIT-AG, is satisfied
with the operational annual result of the Munich-based real estate group:
'We have exceeded our operational goals in a difficult market environment
and have also further improved the occupancy rate of our portfolio.'
Despite a repeated valuation loss, he comments the property valuation
positively: 'We consider that to be a reversal of the trend. Around 18% of
our properties were stable or gained in value. In addition, the valuation
loss on the portfolio level was cut in half compared to the previous year.
In our opinion, this is an indication that we have seen the bottom line.'

The final results for the 2009 financial year will be published by Fair
Value REIT-AG on March 25, 2010 in the Investor Relations section of
www.fvreit.de.

Preliminary Financial Figures for Fair Value REIT-AG

                                         31.12.2009        31.12.2008

Consolidated result EUR -4.2 million EUR -13.3 million
EPS EUR 0.45 EUR -1.41
Adjusted consolidated net income (acc. EUR 5 million EUR 5.2 million
EPRA)
EPRA-EPS EUR 0.53 EUR 0.55
FFO EUR 2.7 million EUR 3.5 million
FFO per circulating share EUR 0.29 EUR 0.37
Balance sheet NAV per share EUR 7.64 EUR 8.16
EPRA-NAV per share EUR 8.15 EUR 8.61

Company profile

Munich-based Fair Value REIT-AG focuses on the acquisition, leasing,
property management and sale of commercial properties in Germany. Its
investment activities focus primarily on offices, logistics and retail
properties in German regional centers. As a REIT-AG, Fair Value is not
subject to corporation or trade tax and benefits from the exit tax
privilege when purchasing properties. Fair Value's USP is that - in
addition to investing directly in real estate - it also acquires interests
in closed-end real estate funds.

In its 'Participations' segment, Fair Value currently participates in 13
closed-end real estate funds in a highly diversified portfolio of 48
properties with a total rental area of 415,829 m² and a market value of
around EUR 480 million as of December 31, 2009 (Fair Value's share of this
portfolio totaled around EUR 191 million on December 31).

In its 'Direct Investments' segment, Fair Value owns a portfolio of 32
commercial properties in Schleswig-Holstein. These have a rental area of
more than 42,948 m² and are mostly used as bank branches. These properties
had a total market value of around EUR 45.5 million as of December 31,
2008.

On December 31, 2009, the proportion of the entire portfolio due to Fair
Value had a market value of around EUR 236.4 million. As of December 31,
2009, this proportionate portfolio was 95.5% let in terms of the achievable
annual rent of EUR 20.9 million. The rental agreements had a weighted
remaining term of 6.3 years on December 31, 2009. Around 46% of the
potential rent stems from retail facilities, 40% from offices, 8% is from
logistics facilities and 6% from other facilities.

Contact

Investor & Media Relations
cometis AG
Dirk Stauer
Phone: +49(0)611 - 205855-22
Fax: +49(0)611 - 205855-66
E-mail: stauer@cometis.de

22.02.2010 Ad hoc announcement, Financial News and Media Release distributed by DGAP.
Media archive at www.dgap-medientreff.de and www.dgap.de

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Language: English
Company: Fair Value REIT-AG
Leopoldstraße 244
80807 München
Deutschland
Phone: +49 (0)89 9292 815-01
Fax: +49 (0)89 9292 815-15
E-mail: info@fair-value-reit.de
Internet: www.fair-value-reit.de
ISIN: DE000A0MW975
WKN: A0MW97
Indices: RX REIT All Share Index, RX REIT Index
Listed: Regulierter Markt in Frankfurt (Prime Standard); Freiverkehr
in München, Stuttgart

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