Annual Report • Mar 29, 2012
Annual Report
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| II | Letter to shareholders | |
|---|---|---|
| III | Key figures | |
| IV | Management report | |
| 1 | Strategy | |
| 2 | Highlights of the financial year | |
| 3 | Overview of the consolidated financial statements | |
| 4 | Management bodies | |
| 5 | Events after the closure of the financial year | |
| 6 | Outlook 2012 | |
| 7 | Corporate responsibility | |
| 8 | Conflict of interest | |
| 9 | Corporate Governance statement | |
| 10 | Research and Development activities | |
| 11 | Information with regard to circumstances possibly having a significant influence on the development of the Sicafi | |
| 12 | Profile of Home Invest Belgium Shareholders | |
| 13 | Discharge of directors and the Auditor | |
| 14 | Description of the main characteristics of the internal control and risk management systems | |
| 15 | Remuneration report | |
| 16 | Auditor's report | |
| V | Home Invest Belgium on the stock exchange | |
| 1 | Stock price and comparisons | |
| 2 | Net asset value and discount / premium | |
| 3 | Key figures of the share on 31 December 2011 | |
| 4 | Dividend policy | |
| 5 | Return for shareholders | |
| 6 | Shareholder identity – Free float | |
| 7 | Shareholders' calendar | |
| VI | Property report | |
| 1 | State of the Belgian residential property market | |
| 2 | Real estate expert's report for the 2011 financial year | |
| 3 | The consolidated property portfolio of Home Invest Belgium | |
| VII | Corporate Governance Statement | |
| 1 | Reference code | |
| 2 | Internal control and risk management | |
| 3 | Board of directors and special committees | |
| 4 | Executive management | |
| 5 | Management team | |
| 6 | Remuneration report | |
| 7 | Auditor | |
| 8 | Surveyor | |
| 9 | Prevention of conflicts of interest | |
| 10 | Prevention of insider trading | |
| 11 | Shareholder structure | |
| 12 | Information in accordance with article 34 of the RD of November 14, 2007 | |
| 13 | Financial service | |
| 14 | Custodian bank | |
| 15 | Liquidity provider | |
| VIII | Financial statements | |
| 1 | Balance sheet | |
| 2 | Income statement | |
| 3 | Statement of comprehensive income | |
| 4 | Appropriation and withdrawals | |
| 5 | Statement of changes in shareholders' equity | |
| 6 | Cash flows statement | |
| 7 | Notes to the financial statements | |
| 8 | Auditor's report on the consolidated financial statements | |
| 9 | Statutory accounts | |
| IX | Permanent document | |
| 1 | General information | |
| 2 | Capital | |
| 3 | Coordinated articles of association at 31 December 2011 | |
| 4 | Sicafi (fixed capital real estate investment trusts): legal framework and tax regime | |
| 5 | Statements | |
| Lexicon | ||
| Information to shareholders |
I Risk factors 6
As an institutional investor on the residential rental market, Home Invest Belgium wishes to contribute to providing an answer to the people's most basic right and need: being able to live in decent housing (Art. 23 of the Belgian Constitution).
Besides providing its tenants with attractive housing, it is Home Invest Belgium's objective to offer its shareholders an appreciable direct net return, combined with value creation in the long term.
Home Invest Belgium (limited company) has been granted the Sicafi status on 16 June 1999 and is Belgium's first private initiative Sicafi (Société d'Investissement à Capital Fixe en Immobilier / fixed capital real estate investment trust) for residential housing.
The Sicafi benefits from a preferential tax status (see Chapter IX point 4), equivalent to the American REIT (Real Estate Investment Trusts) and the French SIIC (Sociétés d'Investissement Immobilier Cotées) and other indirect real estate investments, which comply with the specific legal and fiscal rules of each country.
On 31 December 2011, or at the end of its 12th year of existence, the fair value of the property portfolio of Home Invest Belgium, excluding the current development projects, amounts to more than e 238 million1 , 78% of which consists of apartments and houses mainly located in the Brussels-Capital Region, known for its dynamic and profitable rental market, its low vacancy rate and its high-quality residential properties.
By spreading risks over more than 1 200 rental units and keep concentrating on the Brussels residential market, Belgium's biggest and the one with the greatest growth and capital gain potential in Belgium, Home Invest Belgium aims at offering its investors a higher than average security level, combined with good middle and long-term prospects.
Home Invest Belgium shares are listed on Euronext Brussels' continuous trading market.
1 The fair value of the property portfolio, including the development projects, amounts to € 256.6 million.
Throughout this Annual Financial Report 2011 the figures and percentages realized in 2011 are compared with those of the 2010 financial year; taking into account the new accounting principles applied to the 2011 financial statements in virtue of the royal decree of 7 December 2010 on Sicafi, the figures of the 2010 financial year have been restated to allow a comparison on the same basis.
In over twelve years of its existence, the Sicafi has increased its initial property portfolio fivefold. Some major projects are at the origin of this appreciable growth:
Evolution of the investment value
"Lambermont" - Schaerbeek (1030 Brussels) >
Home Invest Belgium conducts its business in an environment subject to permanent change, which leads to certain risks.
Should these risks materialize, they could have an adverse effect on the company, its business, its outlook, its financial situation or its results.
These risks consequently need to be taken into account within the framework of the company's global management, its investment and divestment decisions, the funding cost of the investments and the optimum reuse of its funding coming from divestments.
The objective of Home Invest Belgium is to manage these risks as well as possible in order to generate a recurrent and increasing rental income on the one hand, and a capital gains potential on the other hand, primarily under the form of positive changes in the fair value of the investments, and subsequently through effectively realised capital gains.
The risk factors with which the Sicafi is confronted are subject to regular monitoring by both the Executive management and the Board of Directors. Cautious policies have been adopted to reduce the exposure of the Sicafi and its shareholders to these factors.
Any direct investment in property involves a certain degree of risk. The same applies for indirect property investments. An investment in a Sicafi owning a diversified property portfolio provides in itself a certain degree of risk spreading.
The main risks connected with investments in property are:
These different factors may be the source of positive or negative changes in the fair value of the investment properties in operation1 , of the occupancy rate of the property portfolio and the level of maintenance or renovation costs. As such, a decrease of 1% of the fair value of the property portfolio would entail a decrease of e 2.4 million of the net result (the net result of 2011 would thus have gone from e 14.8 million to e 12.4 million), but would have no impact at all on the net current result nor the distributable result. According to this hypothesis the net asset value would also decrease by e 2.4 million, or e 0.81 per share and the debt ratio would consequently evolve from 34.02% to only 34.32%.
Furthermore, it should be pointed out that rents are index-linked, meaning that, at a given portfolio and occupancy rate, a Sicafi's rental income develops basically in line with inflation (or deflation).
On 31 December 2011, the investment property portfolio of Home Invest Belgium (excluding development projects and assets held for sale) consisted of 1 211 rental units representing a total surface of more than 130 048 m2, spread across the Brussels-Capital Region (69.4%), the Flemish Region (15.4%) and the Walloon Region (15.1%).
The development of supply and demand in property is influenced by the general economic climate. Consequently, a downturn in the main Belgian and international macroeconomic indicators, as was the case since the end of 2008 – beginning of 2009, with an influence on the household disposable income, can affect the occupancy rate of Home Invest Belgium's portfolio, or the level of the rents.
To limit these negative effects of its exposure to the economic climate, the Sicafi diversifies its investments, entering different types of buildings (high- and middle segment) and geographic locations. The economic downturn was clearly more visible in certain locations and segments, confirming the contribution of diversification to reducing the risk.
The Board of Directors and the Executive management of Home Invest Belgium are furthermore constantly striving for high add value to the Sicafi's portfolio, through the quality of commercial and technical management as well as through the rigorous selection of new investments and the in-depth analysis of divestment opportunities.
1 In accordance with IAS 40 investment properties – including development properties – are valued at fair value. As a derogation to IAS 40 § 53 allows that development projects are valued at cost if it is impossible to define the fair value of these projects in a reliable way. The investment properties in operation concern the investment properties excluding the development projects.
Although the company is alert to respecting regulations and is therefore surrounded by experts, it is exposed to the risk of not respecting regulatory limitations, a/o environmental.
On the other hand, Home Invest Belgium' business and its results for shareholders partially depend on the regulatory environment in place, more specifically with regard to taxes, whether federal, regional, provincial or at city level. As is the case for any company, a change in this regulatory framework can impact the company's profitability or the shareholder's return.
We need to remind that, in a press release of 28 January 2010, the European Commission has announced that Belgium will be asked to modify its tax rules regarding dividends paid by Belgian Sicafi, investing all their assets in property. This announcement aims at Belgian Sicafi investing a minimum of 60% of their assets in residential property on Belgian territory. At present, the Belgian legislation indeed foresees an exemption of withholding tax at the source (withholding tax of 21% since 1 January 2012) to the distributed dividends. Consequently, the risk for the shareholders consists of a modification or deletion of this exemption regime.
Home Invest Belgium's knowledge, at the present date of editing this annual financial report, of the tax treatment of the dividend, is detailed hereafter in point 11.
On the other hand, and globally, it has become clear that the regulatory risk has become very real in the current economic context, both Belgian and international, and is consequently subject to a continuous monitoring by the Board of directors and the Executive management.
In principle, Home Invest Belgium is exposed, to a limited degree, to the risk of inflation, because the collected rents are adjusted in line with the development of the consumer price index, measured by the health index.
A context of renewed inflation, as has been the case in 2011, can entail an increase of the interest rates and represents a real risk of increasing financial charges due to the "time gap" between rising interest rates and rent adjustments.
Home Invest Belgium has taken appropriate measures to hedge against this type of risk (see item 4 below) by entering into hedges.
By contrast, in a context of deflation, or in the case of a temporary freezing – totally or partially – of the rents imposed by the government, the growth of the rental income can be slowed down. The current legislation on residential rental contracts does not allow a minimum rent in case of deflation. Nevertheless, deflation can lead to a decrease of the interest rates, resulting in a limited decrease of the financial charges, due to the aforementioned hedges.
Home Invest Belgium maintains a clear and cautious policy in its business funding. This policy involves the will not to expose the Sicafi – and its shareholders – to possible important rises in interest rates.
To this effect, the Board of directors has set down the target of keeping the proportion of credits with variable interest (non-hedged) rates under 15% of the fair value of the property investments.
The Sicafi also conducts a dynamic management of its cash flow, using it primarily to temporarily reduce - subject to any reborrowing - certain lines of credit.
| Bank | Size of credit lines (e) | Type | Used (e) | Expiry | |
|---|---|---|---|---|---|
| Variable rate credits | ING | 14 950 000 | Rollover credit | 14 950 000 | 31/05/2012 |
| ING | 9 400 000 | Rollover credit | 6 700 000 | 30/09/2012 | |
| ING | 6 540 000 | Rollover credit | 6 540 000 | 31/05/2013 | |
| ING | 6 000 000 | Rollover credit | 6 000 000 | 1/08/2013 | |
| BNP | 6 250 000 | Rollover credit | 6 250 000 | 30/09/2013 | |
| BNP | 6 250 000 | Rollover credit | 6 250 000 | 30/09/2013 | |
| BNP | 2 000 000 | Rollover credit | 2 000 000 | 31/01/2014 | |
| DEXIA | 9 400 000 | Rollover credit | 9 400 000 | 27/11/2014 | |
| DEXIA | 11 350 000 | Rollover credit | 8 550 000 | 31/12/2014 | |
| ING | 12 000 000 | Rollover credit | 12 000 000 | 31/12/2014 | |
| BNP | 14 530 000 | Rollover credit | 1 700 000 | 7/12/2014 | |
| ING | 450 000 | Straight loan | - | ||
| BNP | 446 208 | Straight loan | - | ||
| Fixed rate credits | DEXIA | 763 750 | Investment credit | 763 750 | 30/09/2023 |
| Total | 100 329 958 | 81 103 750 | |||
| Hedges1 | DEXIA | 10 000 000 | Floor-double Cap | - | 10/07/2013 |
| ING | 20 000 000 | IRS | - | 20/12/2013 | |
| DEXIA | 11 750 000 | IRS | - | 30/10/2014 | |
| ING | 20 000 000 | IRS | - | 16/12/2015 | |
| DEXIA | 15 000 000 | IRS callable | - | 17/06/2019 | |
| Total | 76 750 000 |
1 For the remaining: see chapter Financial statements.
At the close of the financial year, the cash flow actually available amounted to:
Home Invest Belgium pays particular attention to obtaining the best financing conditions in the banking market. To this effect, the Executive management is in close touch with various financial institutions. The results of this dynamic, though cautious debt policy are to be seen in the table below showing the lines of credit available to the Sicafi on 31 December 2011.
The Board of Directors considers that the interest rate risks have thereby been adequately covered. Notwithstanding the possibilities provided by article 57 of the RD of 7 December 2010 on Sicafi, Home Invest Belgium has not mortgaged any properties nor provided creditors with any other securities.
The total amount of credits expiring in 2012 is e 21 650 000. The renewal of these credit lines for a 5-year period is as from now secured.
Home Invest Belgium realises its total turnover in Belgium and holds its total liabilities in the euro-zone. All financing is likewise conducted in euro. This means that the Sicafi is not subject to any exchange rate risk within the scope of the current euro-zone constellation.
A decrease of the interest rates does however generally lead to a negative change in the fair value of the hedges2 , while an increase of the interest rates usually results in a positive change in their fair value. It has to be noted that these changes are purely latent and temporary.
In total, at the closing of the financial year 2011, the decrease of the interest rates recorded the last couple of years, had a negative impact of e 4 726 384 on the net asset value (NAV), or e 1.55 per share.
The average interest rate for debt over the financial year 2011 amounted to 3.40%. A change of the market interest rates would have had a limited impact on the financial result, as nearly all credits are covered by hedges. Thus, an increase of the interest rates by 1% over the financial year 2011 would have led to an additional interest cost of approximately e 146 000, resulting in an increase of the average interest rate of debt to 3.58%.
Home Invest Belgium has no significant exposure to price, credit or cash flow risks.
2 The decrease in fair value of financial instruments is accounted for in the equity of 31 December 2011 for the effective part and in the results for the ineffective part.
The conclusion of a financing or hedge agreement with a financial institution creates a counterparty risk in case of default of this institution. This risk could consist of a shortage of cash of the financial institution, and even the loss of deposits. In order to limit this counterparty risk, Home Invest Belgium appeals to different renowned banks to ensure a sufficient diversification of the source of its financing and hedging, always watching over the qualityprice report of the services rendered. Finally we need to point out that the Sicafi's cash is primarily used to reduce the debts and that Home Invest Belgium consequently never deposits large amounts of cash. Even if this risk can be considered as limited, the fact that one or more counterparty banks of Home Invest Belgium is in default, can't be excluded – taking into account the current eventful financial affairs.
The vast majority of the credits granted are 'bullet credits', i.e. credits reimbursed on expiry, with only payment of interests in the meanwhile.
Given the legal and regulatory status of Sicafi, with their mission of investing in low-risk property assets and generating a recurrent income – in particular in rented residential property (houses, apartments), its core business – the Board of Directors of Home Invest Belgium considers that, in a context of a credit narrowing, the risk of lines of credit not being renewed on expiry which would entail a liquidity crisis, has again become, as was the case in 2009, a point of special interest.
As shown in the table above in point 4, Home Invest Belgium endeavours to obtain long-term confirmed credits and achieve a good spread of expiry dates.
On 31 December 2011 Home Invest Belgium's debt ratio amounted to 34.02%3 . Compared to the maximum authorised debt ratio by the legislation on Sicafis (65%), the theoretical additional debt capacity of the sicafi is over € 200 million. It needs to be pointed out that in case of exceeding the 50% debt ratio on a consolidated level, article 54 of the RD of 7 December 2010 foresees that the sicafi should present a financial plan to the FSMA, accompanied by an execution calendar, with an overview of the measures to prevent exceeding a debt ratio of 65%.
Home Invest Belgium's Board of directors and Executive management, aware of the risks connected with the management and quality of the portfolio, have set themselves strict, clearcut criteria for investment and disinvestment, maintenance and renovation of properties and their commercial and technical management, in order to limit vacancy and obtain the best valuation of the Sicafi's portfolio.
Total turnover of Home Invest Belgium consists of rents generated by renting properties to third parties (private individuals, authorities, retailers, companies, embassies and foreign delegations, operators of nursing homes). Late or non-payment of rents and a decrease of the occupancy rate are liable to have a negative impact on results.
In order to reduce this risk, Home Invest Belgium conducts a policy of diversified investments on the residential market, both from a geographic and sectorial perspective and with regard to the type of tenant targeted.
As regards non-payment, the Sicafi benefits from its position in the middle to upper-middle market segment, from its high number of tenants, and the quality of tenants selected. For the 2011 financial year, unsettled rents amounted to some € 0.14 million, or 0.9% of total rents.
Taking into account the very large number of tenants, the demographic outlook in Belgium showing an important increase and the fact that housing is by nature a basic need for people, the risk of vacancy significantly rising can be considered as limited; this situation is reflected each year in low vacancy rates (5.39% in 2010 and 4.62% in 2011).
The attractiveness of Home Invest Belgium's property portfolio on the rental market as well as its valuation depends on the perception tenants or potential buyers have of the properties, and in particular of their quality, their state of maintenance and their security. This is why Home Invest Belgium has set up its own internal management team, to maintain a high-quality service for tenants and to meet up, as far as possible, to their wishes and requirements.
To accomplish this, Home Invest Belgium makes use of carefully selected external managers for the technical management of the buildings and the partition of service costs. In case of default of these service providers, the financial risk for Home Invest Belgium is low, as rents and service charges are paid directly into bank accounts opened in the name of the Sicafi. The external managers have no access to the bank accounts receiving the rents, while withdrawals from the accounts receiving the service charges are strictly limited.
Home Invest Belgium conducts a policy of continuously keeping its property portfolio in good repair and modernised with a view to maintaining or even increasing current rents, but also, if possible, facilitating the re-letting or sale of its property assets.
When acquiring a building needing substantial renovation, its cost reflects the state of the building prior to its renovation when incorporated in the property portfolio. However, the renovation cost
3 The debt ratio is calculated according to the provisions of article 27 § 2 of the RD of 7 December 2010 on Sicafi.
is foreseen in the financial plan developed before the investment decision, taking into account that these costs in principle lead to an at least equivalent value increase.
Furthermore Home Invest Belgium has also decided to gradually develop a limited number of residential projects for own account "from scratch". It is the sicafi's opinion that the limits imposed by its Board of directors4 on the one hand, and the specific competencies of the team that will be built on the other hand, are adequate and will therefore limit the counterparty risk as well as the risk of exceeding the initially defined budgets, to a minimum. The success of this new activity has since then been reflected in the swift commercialization of the 23 newly developed apartments rue Jourdan 85 in Saint-Gilles and the City Gardens complex in Leuven comprising 138 apartments and 2 commercial spaces, and particularly in the unrealized capital gains already generated by these two operations.
The risk of properties fully owned by the Sicafi being destroyed by fire, explosion or other disasters is covered by appropriate insurance policies, covering their reconstruction value to a sum total of € 167.3 million on 31 December 2011. Co-owned properties are themselves insured at reconstruction value by the various coowners.
The normal duration of the leases is essentially established based on the type of asset and is usually as follows:
Despite the extreme spreads of the duration of the leases, the leases signed by Home Invest Belgium are, on average, shorter than leases for professional real estate. Consequently, this shorter duration can lead to a higher rotation than is the case for professional real estate, and thus to higher management costs over the life span of the building.
The Sicafi reduces this inconvenience by enhancing tenant loyalty through making an appeal to qualified property managers and experienced business agents (syndics).
Given the particularities of residential property and the type of properties in which Home Invest Belgium invests, the risk of leases being terminated is spread over a very large number of tenants – more than one thousand – and a wide range of geographic locations. No major property in the portfolio is rented to a single tenant. The most important tenant represents 2.16% of total rents. No main lease expires in 2012. This risk can therefore be considered to be relatively low.
The political risk comprises different topics.
As mentioned in the aforementioned point 3, a temporary freezing, entirely or partially, of the rents cannot be fully excluded, even if such a measure, as had been indicated in the past, would be counterproductive for preserving the residential property market and the level of maintenance and renovation of property.
The consequences of a possible global transfer of the housing authority at a regional or communal level would be limited and could at the very most make managing the property portfolio more complex, as is already partially the case with regard to the different current regimes on technical standards and premiums or grants. Finally, the impact of a possible splitting-up of the country can
hardly be defined in terms of future profitability of Home Invest Belgium, knowing that the Sicafi has nearly ¾ of its property in the Brussels-Capital Region, a region suffering from a structural shortage of accommodation.
The risk of the investor in Home Invest Belgium shares can be analysed from different points of view.
On the one hand, at the level of the duration of the investment: investing in a Sicafi is usually considered as an investment at the medium or long term, with a minimum duration of 3 years.
On the other hand, as it is a listed value, the share price fluctuates in function of the evolution of the stock exchange, also depending on the development of interest rates.
However, as elaborated in chapter V hereafter, we have noticed that the share price has barely suffered from the general low-spirited context prevailing on the stock exchange, and has on the contrary continued its increasing trend.
As explained in point 2, treating the regulatory risk, residential Sicafi such as Home Invest Belgium benefit from a special tax regime, consisting of an exemption of withholding tax at the source. In the current context and at the moment of closing the editing of this report, this exemption is not being questioned.
Finally, this investor's risk depends on the nature of Home Invest Belgium's business, and thus essentially on the development of the residential property market in Belgium. The strategy developed by the Board of directors and implemented by the Executive management (see chapter IV, point 1 below) aims at positioning Home Invest Belgium at the core of that specific market.
4 See management report, point 1.1.
Since the Law of 28 December 2011, and based upon documents existing at the end of February 2012, one can conclude that the situation is as follows for the dividends distributed by Home Invest Belgium:
The dividends distributed by Home Invest Belgium thus remain exempt from the WT of 21%.
The contribution of 4% will be due at the moment of collection of the personal income tax, except if the beneficiary 'opts' for the additional withholding at the source of 4%. The practicalities still have to be elaborated by a royal decree;
Home Invest Belgium or the paying agent thus has to declare the distributed dividends and the beneficiaries (physical persons) to the administration, except for those who opt for the additional withholding of 4% at the source. In the latter case, Home Invest Belgium or the paying agent automatically has to withhold the contribution of 4%.
We are pleased , once again, to be able to present you excellent results for the Sicafi Home Invest Belgium for 2011. Indeed, the distributable result is superior to the one announced in the outlook published in the previous annual financial report, and leaps by nearly 20% compared to 2010.
Globally speaking, the operating result of the company has substantially improved with an increasing growth rate in the course of the 2011 financial year, while the average occupancy rate also progressed from 94.6% to 95.4% in 2011.
The rental income grew by 10.3%, while the increase of the property charges could be limited to 7.3%, after the regression of more than 3% already realized in 2010. More specifically, we need to remind that the technical costs drop by 15.9% and the commercial costs remain steady at € 0.5 million.
The renovation of the complex City Gardens in Louvain could be completed within the initially foreseen deadline and its letting could be successfully closed, with initially foreseen rent levels largely exceeded.
The portfolio result leaps by 74%, going from € 4.9 million to € 8.5 million, under the substantial influence of the latent capital gains on investment properties, progressing by 66%, as well as the result on sales which has more than doubled.
Moreover we need to point out that the distributable amount generated by these sales has also largely exceeded the amount realized last year: € 2 350 000 in 2011 compared to € 1 085 000 a year before, or a rise by 116%. These distributable capital gains on sales currently represent 23% of the distributable result for the financial year.
The consolidated net result, which comprises the portfolio result, records in its turn a new appreciable rise of 25.6% (+ 63% already in 2010), namely thanks to the reinforced active arbitrage on buildings in portfolio.
The distributable result of the financial year also strongly rises by 19.9% to € 10.2 million, or € 3.50 per share compared to € 3.02 in 20101 , while the average number of shares with full dividend rights itself only progresses by 3.5%.
In 2009, at the occasion of its 10th year of existence, the Sicafi has launched a regular portfolio rotation programme in order to respond in a timely manner to the important challenges awaiting investors with regard to sustainability and energy performance of their property. The Board remains persuaded of the soundness of this policy and has fixed as an objective to annually sell approximately 4% (in fair value) of its investment properties by selecting the less recent or less performing ones. This policy will indeed contribute to the constant rejuvenation of the portfolio and also allow continuing to generate capital gains for the shareholders in the course of the coming years.
The Extraordinary general meeting of 23 December 2011 has at first approved two important operations with regard to the acquisition of investment properties and subsequently a profound amendment to the articles of association.
The acquisitions relate in the first place to the transfer to the Sicafi, through a new partial demerger of the SA V.O.P., of a leasehold right of 60 years on four small investment properties in the Brussels-Capital Region and the full ownership of a development project under construction in Jette, designed according to the latest energy standards and comprising 34 apartments, 1 shop and 34 indoor parking spaces. The total evaluation of this portfolio has been fixed at € 7.5 million including costs, reinforcing the Sicafi's shareholders' equity through the issue of 118 491 new shares.
The second operation relates to the acquisition, through demerger of the SA URBIS belonging to the AG Insurance group, of an existing residential complex, part of a larger property, and very well located at Wilsonplein in Gent; the net rentable surface of the 18 apartments covers +/- 2 346 m², while its conventional value amounts to € 3.2 million, including costs. Taking into a debt of € 2.8 million comprised in the contribution, the increase of the Sicafi's shareholders' equity is limited to € 0.4 million and has resulted in the issue of 6 318 new shares.
These operations perfectly fit within the investment strategy of the Sicafi and contribute to the rejuvenation of its portfolio. On the other hand they are examples of its capacity to spot and seize good market opportunities.
The amendment to the articles of association approved at the end of the year had as a primary objective to comply the articles of association to the new legal provisions, i.e. the royal decree of 7 December 2010 on Sicafi and the Law of 20 December 2010 on the exercise of certain rights of shareholders in listed companies.
Taking into account these very good results, the Board has decided to propose to the annual general meeting of shareholders to distribute a dividend, again substantially higher than the previous, of € 3 per share with full dividend rights, compared to € 2.75 in 2010, or an improvement of 9%.
1 Expressed per share, the increase amounts to 15.9%.
Notwithstanding this new significant rise of the dividend, the payout ratio amounts to 85.65%2 , slightly superior to the legal minimum of 80%, while the company can again "carry forward" an amount of € 0.22 per share compared to € 0.56 last year.
For the shareholder who would have participated to the initial public offering ('IPO') in June 1999, based on the initial net asset value of € 34.46 per share, and who would have reinvested, each year, his dividend in Home Invest Belgium shares, the 'IRR' or "Investment Rate of Return", calculated over this twelve year period, and taking into account the growth of the net asset value per share over 2011 (from € 54.68 to € 57.58), would amount to nearly 13.9%3 per year.
We sincerely wish to thank our shareholders for their loyalty and their faith in the development of our Sicafi.
Finally, we wish to thank all our employees for their dynamism and their commitment, qualities that have again significantly contributed to the substantial growth of the results of Home Invest Belgium in the course of the past financial year.
Brussels, 27 February 2012
Xavier Mertens Managing director Gaëtan Hannecart Director Liévin Van Overstraeten Director Koen Dejonckheere Director Eric Spiessens Director Johan Van Overstraeten Director Guy Van Wymersch - Moons Director and Chairman of the Board Guillaume Botermans Director Luc Delfosse Director
2 The payout ratio on a statutory basis amounts to 84.61% in 2011. In 2010, it was respectively 90.99% on a consolidated basis and 89.06% on a statutory basis.
3 The return for the shareholders is detailed in Chapter V - point 5.
| Overall figures | 31/12/2011 | 31/12/2010 | 31/12/2009 | 31/05/2000 |
|---|---|---|---|---|
| Total surface area | 130 048 m2 | 125 903 m2 | 118 845 m2 | 34 626 m² |
| Number of properties | 90 | 86 | 89 | 22 |
| Number of sites | 54 | 46 | 47 | 12 |
| Number of leases | 1 211 | 1 120 | 1 019 | 318 |
| Occupancy rate | 95.38% | 94.39% | 94.60% | 99.08% |
| In € thousands | 31/12/2011 Consolidated IFRS |
31/12/2010 Consolidated IFRS |
31/12/2009 Consolidated IFRS |
31/12/2008 Consolidated IFRS |
|---|---|---|---|---|
| Net rental result | 15 536.17 | 14 115.94 | 13 675.62 | 11 690.47 |
| Property result | 14 464.25 | 13 134.69 | 12 874.18 | 11 025.81 |
| Property operating result before the portfolio result (EBIT)1 | 10 362.60 | 9 174.63 | 8 923.97 | 7 818.40 |
| Portfolio Result | 8 545.80 | 4 917.62 | 1 559.01 | -489.47 |
| Operating result | 18 908.41 | 14 092.25 | 10 482.98 | 7 328.92 |
| Result before tax | 14 841.40 | 11 720.63 | 8 088.32 | 5 309.63 |
| Net result | 14 833.59 | 11 807.67 | 8 082.29 | 5 273.37 |
| Net current result | 6 287.79 | 6 890.05 | 6 523.29 | 5 762.84 |
| Net current result excluding IAS 39 | 7 711.71 | 7 344.71 | 6 821.68 | 5 762.84 |
| Distributable result | 10 202.482 | 8 509.342 | 7 695.51 | 6 751.73 |
| Dividend for the financial year3 | 8 738.80 | 7 742.98 | 6 716.71 | 5 842.71 |
1 Earnings Before Interest and Taxes.
2 Consolidated distributable result. On 31 December 2011, the statutory distributable result in accordance with the provisions of the RD of 7 December 2010 amounts to e 10 374 550.
3 The statutory dividend for the 2011 financial year amounts to e 8 777 536 compared to e 7 778 490.50 for 2010 and e 6 748 087.12 for 2009. These dividends include the dividend to be paid to the subsidiary, Home Invest Management, with regard to the 12 912 shares held under auto-control.
| In € thousands | 31/12/2011 Consolidated IFRS |
31/12/2010 Consolidated IFRS |
31/12/2009 Consolidated IFRS |
31/12/2008 Consolidated IFRS |
|---|---|---|---|---|
| Investment properties (fair value)1 | 238 453.17 | 222 773.97 | 207 189.92 | 198 099.32 |
| Investment value of the portfolio2 | 272 247.57 | 246 558.32 | 229 001.89 | 218 821.40 |
| Equity | 175 237.84 | 153 968.04 | 149 050.81 | 147 090.63 |
| Total debt3 | 93 040.70 | 81 405.47 | 81 582.09 | 65 001.86 |
| Debt ratio3 | 34.02% | 33.98% | 34.82% | 30.31% |
1 Excluding assets held for sale and development projects.
2 Investment value, including legal fees, as estimated by the property surveyor, excluding long and short-term receivables for the long-term lease on the rue de Belgrade and the property leasing of the Résidence Lemaire (including properties for sale).
3 Total debt calculated according to the provisions of the RD of 7 December 2010, with the 2011 dividend remaining part of equity until the Ordinary general meeting of 2 May 2012.
| In % | 31/12/2011 Consolidated IFRS |
31/12/2010 Consolidated IFRS |
31/12/2009 Consolidated IFRS |
31/12/2008 Consolidated IFRS |
|---|---|---|---|---|
| Gross yield on rents received or guaranteed | 6.18% | 6.15% | 6.29% | 6.07% |
| Operating margin1 | 71.64% | 69.85% | 69.32% | 70.91% |
| Operating margin before tax2 | 43.53% | 51.79% | 50.72% | 52.60% |
| Net current margin3 | 43.47% | 52.46% | 50.67% | 52.27% |
| Payout ratio4 | 85.65% | 90.99% | 87.28% | 86.54% |
1 Operating result before the portfolio result / property result.
2 Pre-tax result excluding portfolio result / property result.
3 (Net result excluding portfolio result) / property result.
4 Dividend / Distributable result.
| In e | 31/12/2011 Consolidated IFRS |
31/12/2010 Consolidated IFRS |
31/12/2009 Consolidated IFRS |
31/12/2008 Consolidated IFRS |
|---|---|---|---|---|
| Net asset value (before distribution) | 57.58 | 54.68 | 52.94 | 52.71 |
| Property result | 4.97 | 4.66 | 4.66 | 4.45 |
| Operating result before portfolio result | 3.56 | 3.26 | 3.23 | 3.16 |
| Portfolio Result | 2.93 | 1.75 | 0.56 | -0.20 |
| Net result | 5.09 | 4.19 | 2.92 | 2.13 |
| Net current result | 2.16 | 2.45 | 2.36 | 2.33 |
| Net current result excluding IAS 39 | 2.65 | 2.61 | 2.47 | 2.33 |
| Growth in value2 | 2.90 | 1.74 | 0.23 | -2.11 |
| Dividend3 | 3.00 | 2.75 | 2.43 | 2.36 |
| Shareholders' return | 5.90 | 4.49 | 2.66 | 0.25 |
| Return in %4 | 10.88% | 8.48% | 5.05% | 0.46% |
1 Calculated on the basis of the average number of shares with full rights, except with regard to the net asset value calculated while taking into account the number of shares at the end of the financial year. The 12 912 shares held by Home Invest Management have been eliminated (cf. IAS 33 § 20).
2 The difference between the net asset values at the beginning and the end of the financial year.
3 Net for gross dividend, due to the fact that more than 60% of assets are residential buildings located in Belgium (See also Risk factors, point 11).
4 Return, divided by the net asset value at the beginning of the period.
| Ordinary shares (excluding the shares held in auto-control) |
31/12/2011 Consolidated IFRS1 |
31/12/2010 Consolidated IFRS2 |
31/12/2009 Consolidated IFRS2 |
31/05/2000 Statutory (Belgian GAAP) |
|---|---|---|---|---|
| At the end of the financial year | 3 043 231 | 2 815 630 | 2 815 630 | 1 103 362 |
| Average number of shares with full rights | 2 912 933 | 2 815 630 | 2 764 079 | 1 103 362 |
1 3 056 143 shares on 31/12/2011 of which 12 912 shares held by Home Invest Management are to be excluded in accordance with IAS 33 § 20.
2 2 828 542 shares on 31/12/2009 and 31/12/2010 of which 12 912 shares held by Home Invest Management are to be excluded in accordance with IAS 33 § 20.
"Erainn" - Etterbeek (1040 Brussels)
< "Galerie de l'Ange" - Namur
At the end of twelve years of the Sicafi's existence, the Board of directors has refined its strategy; as from now on it is the Board's opinion that Home Invest Belgium's objective is to satisfy its two 'stakeholders': its tenants and shareholders. Notwithstanding their apparent opposite interests, they undoubtedly meet in the defined strategy.
This strategy is indeed focused around two complementary axes: on the one hand it consists of an exclusive concentration of new investments on high-quality residential buildings, as well to their location as to their intrinsic qualities, buildings that are ensured to be managed efficiently in the direct interest of the tenants; on the other hand, these same buildings can be subject to arbitrages for sale in the long run and thus allow to realize accumulated capital gains built up during the previous years of operation. The good performance of both activity poles is thus closely related.
Consequently, it is in the common interest of its tenants and shareholders that Home Invest Belgium explores the market for residential or mixed buildings that can generate a maximum return, composed of the immediate net return, measured in terms of net rental income, and the creation of long-term value, reflected in the evolution of the net asset value, within the legal framework applicable to residential Sicafi, i.e. currently and mainly:
• a minimum of 60% of the total value of the portfolio has to be invested in residential properties in Belgium in order to benefit from the exemption of withholding tax on the dividend;
The strategy defined by the Board of directors can be explained more profoundly, based on the following three cornerstones:
We remind that Home Invest Belgium has opted for a 'pure player' strategy. This consists in mainly investing in real residential property for letting (apartments, houses), easy to sell lot per lot and with a capital gain potential, in the form of positive changes in fair value, and in the long term, effectively realized capital gains.
In order to accelerate the growth and the rejuvenation of its portfolio Home Invest Belgium has increased the rhythm of its analysis of investment opportunities, based, on the one hand, on the selective acquisition of existing residential property portfolios, and, on the other hand, on projects to be developed internally. Indeed development projects:
2 No dispensation has been asked for up to now.
1 The statutory accounts can be found under point 9 of chapter VIII of this annual financial report.
3 The corrected result is defined in article 27 of the Royal Decree of 7 December 2010 and in chapter 3 of its annex C.
We need to remind that the increasing project development for own account is subject to the following internal limitations, defined by the Board of directors, i.e. mainly:
The investment criteria applicable both to new acquisitions – including existing property portfolios – and to the development of newly built property for own account are the following:
1.2 The optimization of rental management evidently is one of the main points of attention. Home Invest Belgium actually manages a very large number of tenants – at present over 1 200 – and the quality of the service, at the levels of administration, technical and commercial management, is an essential part of the company's success. Continuous efforts are being made to uniformize and automate this management, always taking into account a strict control of the operating expenses, more specifically with regard to personnel.
An effective IT system allows to obtain economies of scale and consequently to differentiate from the multitude of private investors operating in that same residential market.
1.3 The selective arbitrage of the buildings in portfolio – in principle via lot per lot sales – represents the third cornerstone of the company's success. Moreover, this contributes in a significant and regular way to the growth of the return on investments, through the substantial capital gains realized in the interest of the shareholders, and to the continuous rejuvenation of this portfolio and its energy performance.
For 2011 this arbitrage represented a volume of 2.45% of the portfolio of buildings in operation, which has allowed to generate a distributable result of € 2.3 million. The Board has fixed a target to reach an annual volume of sales of +/- 4% of the portfolio of buildings in operation, as from 2012.
Within this context, these sales mainly relate to:
• buildings having reached their peak in terms of valuation.
The selection process of the related buildings is a point of special interest of the Executive management that has to prepare the decisions, as well as of the Board of directors; this requires a thorough examination of the building concerned, taking into account a precise and well-documented study of the local property environment.
2.1.1 The extraordinary general meeting of Home Invest Belgium of 31 January 2011 has approved the partial demerger of a large part of the property assets of the SA MASADA. The properties acquired in that way comprise a number of very well located buildings in different Brussels municipalities, amongst which Ixelles, Brussels City and Uccle.
2.1.2 With regard to the project Belliard/Industrie, of which the construction site got behind due to a problem of faulty concrete, the provisional acceptance of the building can now be expected during the first half-year of 2012. This relates to the development of a hotel residence with 109 rooms by Nexity IG for the account of the SA Belliard 21, a 100% subsidiary of the Sicafi, and the renovation into six apartments of an old mansion; the project is located at the corner of the rue Belliard and the rue de l'Industrie, in the heart of the Brussels European quarter.
2.1.3 The fourth and last phase of the renovation of the property complex City Gardens, located at Riddersstraat/Petermannenstraat and Fonteinstraat in Leuven, acquired at the end of 2009, could be successfully completed. Globally, the commercialization of this complex ran very favourably, as well with regard to the rhythm by which the lettings were concluded, as to the level of the rents. The gross initial yield on this global operation indeed reaches +/- 6.8% of the total amount invested, compared to the 6.29%, initially forecasted.
2.1.4 On 23 December 2011 the extraordinary general meeting of Home Invest Belgium approved a new partial demerger of the SA V.O.P.; this real estate company belongs to the Van Overstraeten group, directly and indirectly, part of the stable shareholders of the Sicafi. In this case, this operation represented a potential conflict of interest, elaborated in point 8 hereafter. Following this operation,
4 For more information, we refer to the quarterly press releases and to the half-yearly financial report available on the website www.homeinvestbelgium.be.
Home Invest Belgium has become the owner of the leasehold rights of 60 years on 4 investment properties, located in the Brussels-Capital Region, as well as the full owner of a development project in Jette, at the corner of the avenue Odon Warland and the rue Bulins. This project comprises 34 apartments and 1 commercial space on the ground floor, with a total rentable surface of +/- 3 123 m² and 34 indoor parking spaces. This building will be equipped with stateof-the-art techniques with regard to energy performance. The total valuation of these acquisitions amounts to € 7 454 000, including costs. For the remuneration of this contribution 118 491 new shares have been issued
2.1.5 The same extraordinary general meeting of 23 December 2011 approved the demerger operation of the SA URBIS, which has allowed to acquire a residential complex of 18 apartments on the Wilsonplein in Ghent, above the shopping center 'Gent-Zuid'. This residential complex with a net rentable surface of +/- 2 346 m² has been incorporated for € 3 200 000 including costs; taking into account the fact that a debt of € 2 800 000 was also taken over, the total contribution has been remunerated by the issue of 6 318 new shares.
2.1.6 Finally, the Sicafi was able to acquire an apartment building on 14 November 2011, very well located in Liège, Quai de Rome 45- 46; it comprises 25 apartments, 2 offices and twenty-four parking spaces; the price of this acquisition amounted to € 2 787 000, costs included. This relates to a classical building held for lease in one of the best locations in Liège.
In accordance with the second strategic axis of the company, sales of assets have been extended in 2011; the main objective was the lot per lot sale of residential complexes, i.e. mostly apartment buildings.
The Sicafi has thus grosso modo doubled its arbitrage volume in comparison with the previous financial year. The table below shows that the number of buildings concerned, sold in their entirety or through different sales, has evolved to eleven compared to five in 2010; in the same way the net total amount of the sales (after deduction of the sale costs) has evolved from € 3 956 293 in 2010 to € 7 802 862 in 2011.
That way, the different sales of the financial year 2011 have allowed to book a net realized capital gain of € 2.1 million in total, compared to their latest fair value (on 31/12/2010); this results also in a distributable capital gain of € 2.35 million, compared to the acquisition value augmented by the investments, that substantially reinforces the consolidated distributable result to the shareholders, for the period.
The table below again indicates the importance of those capital gains, in comparison with the latest fair value as well as with the initial acquisition value of the buildings sold.
For the seventh year in a row, the effectively realized sales show the importance of the capital gains which can be generated by investing in high-quality residential property, at the right moment, in combination with a professionally and selectively driven arbitrage.
As explained in point 1.3 these arbitrage activities have clearly become the second cornerstone of the Sicafi's strategy, and should continue to significantly contribute to the growth of the distributable result to shareholders.
| In € | Transaction object | Sales price | Latest fair value |
Net realized capital gain in % compared to latest fair value |
Acquisition price + investments |
Net realized capital gain in % compared to acquisition price + investments |
|---|---|---|---|---|---|---|
| Nieuport | 1 commercial space and 2 garages |
315 000 | 191 781 | 64.25% | 210 959 | 49.32% |
| Coningham | 6 apartments | 1 328 900 | 895 805 | 48.35% | 895 805 | 48.35% |
| Marie José | 2 parkings | 41 000 | 22 666 | 80.89% | 22 666 | 80.89% |
| Bergmann | complete building | 1 100 000 | 694 572 | 58.37% | 694 572 | 58.37% |
| Montana Tamaris | 2 apartments | 1 410 000 | 985 860 | 43.02% | 749 634 | 88.09% |
| Floréal | 1 apartment | 200 000 | 97 779 | 104.54% | 97 779 | 104.54% |
| Stevin | 1 commercial space | 172 500 | 108 651 | 58.76% | 108 651 | 58.76% |
| Clos Saint Georges | 2 villas | 1 010 500 | 925 051 | 9.24% | 397 144 | 154.44% |
| Abeilles | complete building | 650 000 | 397 734 | 63.43% | 397 734 | 63.43% |
| Decroly | 2 villas | 760 000 | 689 778 | 10.18% | 370 434 | 105.16% |
| Dieweg | complete building | 895 000 | 696 637 | 28.47% | 685 798 | 30.50% |
| Costs | -80 038 | |||||
| Total | 7 802 862 | 5 706 313 | 36.74% | 4 631 176 | 68.49% |
The average occupancy rate for the entire financial year 2011 amounted to 95.38%, an improvement compared to 2010 (94.61%). It has to be noted that this occupancy rate is higher than the 95% taken into consideration in the outlook for the financial year 2011. It also has to be pointed out that it undergoes the negative influence, purely temporarily, of the developments at their provisional acceptance.
During the extraordinary general meeting of 23 December 2011 a profound revision of the articles of association has been approved. This amendment to the articles of association became necessary mainly in order to take into consideration the provisions of the royal decree of 7 December 2010 with regard to Sicafi, as well as to the law of 20 December 2010 on the exercise of certain rights of shareholders of listed companies.
The new coordination of the articles of association is recorded in chapter IX of this annual financial report and can be consulted on the website www.homeinvestbelgium.be.
The consolidated financial statements 2011 recorded below have been established according to the International Financial Reporting Standards ('IFRS') and the provisions of the Royal Decree of 7 December 2010.
| 2011 | 2010 | |
|---|---|---|
| ASSETS | ||
| I. Non-current assets | 257 986 342 | 234 721 489 |
| B. Intangible assets | 7 623 | 8 349 |
| C. Investment properties | 256 558 090 | 233 344 258 |
| D. Other tangible assets | 200 744 | 41 094 |
| E. Non-current financial assets | 37 755 | 46 767 |
| F. Finance lease receivables | 1 182 131 | 1 281 021 |
| II. Current assets | 15 492 597 | 4 825 437 |
| A. Assets held for sale | 7 522 808 | |
| C. Finance lease receivables | 98 890 | 92 752 |
| D. Trade receivables | 4 118 361 | 684 851 |
| E. Tax receivables and other current assets | 1 928 583 | 2 989 647 |
| F. Cash and cash equivalents | 1 701 118 | 1 036 510 |
| G. Deferred charges and accrued income | 122 836 | 21 678 |
| TOTAL ASSETS | 273 478 939 | 239 546 926 |
| SHAREHOLDERS' EQUITY | ||
|---|---|---|
| A. Capital | 73 469 670 | 70 946 880 |
| B. Share premium account | 19 093 664 | 19 093 664 |
| C. Reserves | ||
| a. Legal reserve (+) | 98 778 | 97 827 |
| b. Reserve from the balance of changes in fair value of investment properties (+/-) | 85 457 148 | 68 696 370 |
| c. Reserve from estimated transfer costs and rights resulting from hypothetical disposal of investment properties (-) |
-23 441 309 | -19 497 399 |
| d. Reserve from the balance of changes in fair value of allowed hedges to which hedge accounting according to IFRS is applied (+/-) |
-2 549 147 | -2 974 112 |
| h. Reserve for treasury shares (-) | -757 323 | -757 323 |
| m. Other reserves (+/-) | 1 259 467 | 1 138 120 |
| n. Result carried forward from previous financial years (+/-) | 7 773 304 | 5 416 341 |
| D. Net result of the financial year | 14 833 588 | 11 807 670 |
| SHAREHOLDERS' EQUITY | 175 237 840 | 153 968 037 |
| LIABILITIES | ||
| I. Non-current liabilities | 64 115 189 | 82 171 517 |
| B. Non-current financial debts | 59 388 750 | 78 433 750 |
| C. Other non-current financial liabilities | 4 726 439 | 3 737 767 |
| II. Current liabilities | 34 125 911 | 3 407 373 |
| B. Current financial debts | 24 926 363 | 465 055 |
| D. Trade debts and other current debts | 8 206 419 | 2 029 317 |
| E. Other current liabilities | 519 171 | 477 347 |
| F. Accrued charges and deferred income | 473 957 | 435 653 |
| LIABILITIES | 98 241 099 | 85 578 890 |
| TOTAL SHAREHOLDERS' EQUITY AND LIABILITIES | 273 478 939 | 239 546 926 |
| Number of shares at end of period | 3 043 231 | 2 815 630 |
| Net asset value | 175 237 840 | 153 968 037 |
| Net asset value per share | 57.58 | 54.68 |
| Indebtedness | 93 040 703 | 81 405 470 |
| Debt ratio | 34.02% | 33.98% |
The intangible assets relate to the WinIris software.
In the course of the financial year the fair value of the investment properties has gone from € 233.3 million on 31 December 2010 to € 256.5 million on 31 December 2011, including the development projects, or a substantial growth of nearly 10%, mainly thanks to:
and this despite an increasing number of sales (see above sub 2.2), with total sales amounting to € 5.7 million in 2011 compared to € 2.9 million in 2010.
The current development projects amount to a total of € 18.1 million compared to € 10.6 million on 31 December 2010.
They comprise the two projects Belliard/Industrie and Odon Warland/Bulins (see above sub 2). It has to be pointed out that the first of both projects is pre-let, to a large extent, to the Pierre & Vacances group and that the total of these two projects remains largely inferior to the limits defined by the company (see above sub 1.1).
The non-current financial assets amount to € 0.04 million, a decrease of 19.3% compared to the previous year, following the decrease of the fair value of the hedges by the application of the accounting standard IAS 39.
The finance lease receivables of € 1.3 million represent the current value of the receivables from the property leasing for the building Rue Belgrade and for the Residence Lemaire, the long-term part of this accounted for under non-current assets, while the short-term part (less than a year) accounted for under current assets.
The item assets held for sale amounts to € 7.5 million; it represents the fair value at closing date of the buildings for which the sales procedure has already been started up at that date.
The trade receivables, strongly increasing to € 4.1 million compared to € 0.7 million the previous year, correspond for the largest part to the amounts to be received within the framework of provisional sales agreements signed at the end of the financial year 2011 (€ 3.5 million), and for the balance (€ 0.6 million) to rent receivables on investment properties, representing 3.3% of the rents earned in 2011.
The tax receivables and other current assets drop to an important degree by 35.5% in comparison with the level at closing date of the financial year 2010 (€ 1.9 million compared to € 3 million in 2010). They comprise tax receivables (mainly withholding tax on liquidation proceeds) for an amount of € 0.7 million, the balance being composed of advance payments to the different coownerships.
The cash and cash equivalents amount to € 1.7 million compared to € 1 million the previous year. We need to remind that the Sicafi's cash is primarily used to temporarily reduce certain short-term credit lines rather than invest in deposits or cash.
Deferred charges and accrued income are at € 0.1 million.
On 31 December 2011 Home Invest Belgium's capital of € 73.5 million is represented by 3 056 143 shares, of which 12 912 are held under auto-control and are excluded from the calculations per share.
The reserves significantly progress by 30% to € 67.8 million compared to € 52.1 million a year before, mainly thanks to an important positive change (+ € 16.8 million) in fair value of the investment properties, listed under the unavailable reserves, or double of the 2010 figures.
We need to remind that the item 'Impact on fair value of estimated transfer rights and costs resulting from hypothetical disposal of investment properties' corresponds to the amendments made to the investment value to define their fair value, according to the rules recorded in the 'Notes to the consolidated financial statements' under chapter VIII Financial statements hereafter. This item increases substantially (+ 20.2%), mainly due to the elimination of the transfer rights on the acquisitions of the previous financial year.
On the other hand we need to point out that the result carried forward from previous financial years currently stands at € 7.8 million, or € 2.55 per share, in comparison with € 5.4 million the previous year (+ 43.5%).
Finally, the net result of the financial year amounts to € 14.8 million, or an increase by 25.6% in comparison with 2010. This corresponds to the result of the financial year, before appropriation of the result. It has to be noted that this figures comprises a/o the net balance of the changes in fair value of the investment properties in the course of the financial year, or an amount that will be booked under the reserves within the scope of the appropriation of the result.
The reserve from the balance of changes in fair value of allowed hedges to which hedge accounting according to IFRS is applied corresponds to the evolution of the fair value of the effective interest rate hedges in the sense of IAS 39, concluded by the Sicafi. Taking into account the evolution of the interest rates since the end of the financial year 2010, the reduction of the hedging period of the current hedges, and finally the accounting through results of the IRS of 20 million, concluded at the end of 2010, this negative item slightly decreases to € 2.5 million compared to € 3 million the previous year. This item thus influences in a negative, though latent way, Home Invest Belgium's shareholders' equity,
and consequently the net asset value per share, for an amount of exactly € 0.84.
The non-current financial debts decrease to € 59.4 million, in comparison with € 78.4 million a year before (- 24.28%), two credit lines expiring in 2012, and consequently recorded in current financial debts for a total of € 21.6 million.
That way, the current financial debts significantly rise to € 25 million compared to only € 0.5 million in 2010. It has to be pointed out that this item also comprises the credit line of € 2.8 million, taken over through the demerger of the SA Urbis, the rental guarantees received and the provisions for expenses from the tenants.
The trade debts and other current debts amount to € 8.2 million compared to € 2 million the previous year. This strong increase can be explained by the provision of € 6.2 million for the completion of the building located at the angle of the rue Belliard and the rue de l'Industrie in Brussels. They also comprise debts to suppliers for € 1.2 million, rents received in advance for an amount of € 0.4 million, and finally, corporate tax debts of € 0.5 million.
The other current liabilities amount to € 0.5 million, amount that is quasi unchanged compared to the previous year, and comprise the dividends of previous financial years, not claimed by shareholders, of € 0.1 million.
The deferred charges and accrued income remained stable at € 0.5 million.
Finally, the net asset value per share5 amounts to € 57.58 compared to € 54.68 on 31 December 2010, or an increase by 5.3%.
5 Calculated excluding the 12 912 Home Invest Belgium shares held under autocontrol (IAS 33, paragraph 20).
| (In e) | 31/12/2011 | 31/12/2010 |
|---|---|---|
| I. Rental income (+) |
15 724 617 | 14 253 402 |
| III. Rental-related expenses (+/-) |
-188 448 | -137 465 |
| NET RENTAL RESULT (= I +II +III) | 15 536 169 | 14 115 937 |
| IV. Recovery of property charges (+) |
83 656 | 106 657 |
| V. Recovery of charges and taxes normally payable by the tenant on let properties (+) |
400 830 | 370 467 |
| VII. Charges and taxes normally payable by the tenant on let properties (-) |
-1 556 402 | -1 458 373 |
| PROPERTY RESULT (= I +II +III +IV +V +VI +VII +VIII) | 14 464 254 | 13 134 688 |
| IX. Technical costs (-) |
-923 309 | -1 097 433 |
| X. Commercial costs (-) |
-541 340 | -535 683 |
| XI. Taxes and charges on unlet properties (-) |
-358 203 | -265 738 |
| XII. Property management costs (-) |
-1 739 400 | -1 419 884 |
| Property costs (= IX +X +XI +XII +XIII) | -3 562 253 | -3 318 738 |
| PROPERTY OPERATING RESULT (I +II +III +IV +V +VI +VII +VIII +IX +X +XI +XII +XIII) | 10 902 000 | 9 815 950 |
| XIV. General corporate expenses (-) |
-539 388 | -641 319 |
| OPERATING RESULT BEFORE PORTFOLIO RESULT (I +II +III +IV +V +VI +VII +VIII +IX +X +XI +XII +XIII +XIV +XV) |
10 362 613 | 9 174 630 |
| XVI. Result sale investment properties (+/-) |
2 096 549 | 1 041 163 |
| XVIII. Changes in fair value of investment properties (+/-) |
6 449 248 | 3 876 459 |
| OPERATING RESULT (I +II +III +IV +V +VI +VII +VIII +IX +X +XI +XII +XIII +XIV +XV +XVI +XVII +XVIII +XIX) |
18 908 409 | 14 092 253 |
| XX. Financial income (+) |
188 741 | 412 723 |
| XXI. Net interest charges (-) |
-2 797 080 | -2 201 999 |
| XXII. Other financial charges (-) |
-34 754 | -127 420 |
| XXIII. Changes in fair value of financial assets and liabilities |
-1 423 915 | -454 930 |
| Financial Result (XX +XXI +XXII +XXIII) | -4 067 008 | -2 371 625 |
| PRE-TAX RESULT (I +II +III +IV +V +VI +VII +VIII +IX +X +XI +XII +XIII +XIV +XV +XVI +XVII +XVIII +XIX +XX +XXI +XXII +XXIII) |
14 841 402 | 11 720 628 |
| XXIV. Corporation tax (-) |
-7 814 | 87 042 |
| TAXES (XXIV + XXV) | -7 814 | 87 042 |
| NET RESULT (I +II +III +IV +V +VI +VII +VIII +IX +X +XI +XII +XIII +XIV +XV +XVI +XVII +XVIII +XIX +XX +XXI +XXII +XXIII +XXIV +XXV) |
14 833 588 | 11 807 670 |
| NET RESULT PER SHARE | 5.09 | 4.19 |
| Average number of shares | 2 912 933 | 2 815 630 |
| NET CURRENT RESULT (excluding the items XVI. XVII. XVIII and XIX.) | 6 287 791 | 6 890 047 |
| NET CURRENT RESULT PER SHARE (excluding the items XVI. XVII. XVIII and XIX.) | 2.16 | 2.45 |
| NET CURRENT RESULT EXCLUDING IAS 39 (excluding the items XVI. XVII. XVIII XIX. and XXIII.) | 7 711 706 | 7 344 977 |
| NET CURRENT RESULT EXCLUDING IAS 39 PER SHARE (excluding the items XVI. XVII. XVIII XIX. and XXIII.) | 2.65 | 2.61 |
| PORTFOLIO RESULT (XVI. to XIX.) | 8 545 797 | 4 917 622 |
| PORTFOLIO RESULT PER SHARE (XVI. to XIX.) | 2.93 | 1.75 |
| DISTRIBUTABLE RESULT | 10 202 475 | 8 509 343 |
| DISTRIBUTABLE RESULT PER SHARE | 3.50 | 3.02 |
| Operating margin (Operating result before the portfolio result) / Property result | 71.64% | 69.85% |
| Operating margin before tax (Pre-tax result – portfolio result) / Property result | 43.53% | 51.79% |
| Net current margin (Net result – portfolio result) / Property result | 43.47% | 52.46% |
| Proposed dividend | 3.00 | 2.75 |
| Pay out ratio | 85.65% | 90.99% |
The rental income amounts to € 15.7 million compared to € 14.3 million in 2010 (+ 10.3%), following the positive influence of the new acquisitions, and this, notwithstanding, but clearly to a lessor extent, the erosion of the rents caused by the sales during the financial year.
The rental-related expenses have increased to € 0.2 million compared to € 0.1 million in 2010, namely under the influence of reductions in value on trade receivables with an increasing trend in a more difficult economic context.
The net rental result consequently stands at € 15.5 million compared to € 14.1 million a year before, representing a nice performance of + 10 %.
The charges and taxes normally payable by the tenant mainly consist of the property tax paid by the Sicafi and remain quasi invariable at € 1.6 million. A part of these taxes (€ 0.4 million) could however be re-invoiced to certain tenants, in accordance with the applicable legislation (commercial spaces, offices, nursing homes). Consequently, the property result amounts to € 14.5 million compared to € 13.1 million a year before, representing a substantial growth of 10.1%.
The technical costs involve maintenance costs for the owner and renovation costs. They amount to a total of € 0.9 million, or another drop by 15.9%, in comparison with € 1.1 million in 2010, which confirms the favourable impact of a new follow-up system introduced since 2009.
The commercial costs thus remain quasi unchanged at € 0.5 million. These costs include commissions paid to estate agents for the conclusion of new leases, the shared cost of inventories and the fees of lawyers engaged in the context of strict rental management of the portfolio.
The taxes and charges on unlet properties amount to € 0.4 million, or an increase of 34.8%, and cover the charges the Sicafi has to bear in case of rental vacancy. They are therefore a direct consequence of the occupancy rate of the buildings in portfolio. Their increase in 2011 is explained by the new arbitrage policy on the portfolio, entailing an important vacancy in the buildings selected for sale.
The property management costs represent staff and operating expenses, the remuneration of the Executive management and the fees paid to the SA Estate & Concept for the management of the complex Résidences du Quartier Européen. They amount to € 1.7 million compared to € 1.4 million a year before, or an increase by 22.5%. The increase of this item is simply explained by the hiring, in the course of the year, of COO, a newly created function, as well as to the reinforcement of the internal teams for sales, analysis and administrative support, with three new employees.
In total the property charges slightly increase by 7.34% to € 3.6
million in comparison with € 3.3 million the previous year; taking into account the conscious increase of the property management costs, as aforementioned, the growth of the portfolio, and the number of leases under management, this cost finally perfectly relates to the growth and arbitrage strategy of the Sicafi.
The property operating result thus amounts to € 10.9 million, or a very nice progress by 11 % in comparison with the result of € 9.8 million recorded in 2010.
The Sicafi's general expenses encompass all charges not directly connected with the direct exploitation of the properties and managing the Sicafi. They consist mainly of fees associated with the Sicafi's stock exchange listing and with its special legal status (NYSE Euronext Brussels, supervisory authority, subscription tax to the SPF Finances, etc.), the fees due to the Auditor, to advisors and to the Sicafi's approved property surveyor. They have decreased to € 0.54 million, or a decrease of 15.9% in comparison with 2010, namely following the positive influence of the deletion of certain items (custodian bank, remuneration of the property developer), and the partial reimbursement of the subscription tax paid for the financial years 2009 and 2010.
This results in an operating result before the portfolio result of € 10.4 million, an important improvement of nearly 13% in comparison with the result recorded at the end of 2010 (€ 9.2 million).
The result on the portfolio is again largely positive with € 8.5 million. Since 2008, with a negative result, 2009 with a slightly positive result and 2010 with a positive result of € 4.9 million, the increasing trend is spectacular. This very good result of 2011 can be explained, on the one hand, by the very positive change in fair value of the investment properties for an amount of € 6.4 million (€ 3.9 million in 2010), but also by the important realized capital gains going from € 1 million in 2010 to € 2.1 million in 2011, or a new increase by 101% (reeds + 89,4 % in 2010). This substantial result show, for the seventh year in a row, the fact that Home Invest Belgium succeeds in creating capital gains to the benefit of its shareholders.
The operating result (after taking into account the portfolio result) thus amounts to € 18.9 million, a substantial rise of 34.2% in comparison with € 14.1 million in 2010.
The financial revenues of € 0.2 million comprise the interest received and the finance lease receivables. This item clearly declines (- 54.3%) in comparison with the previous year because of the non-recurrence of extraordinary income in 2010.
The interest charges clearly increase (+ 27%) following the increase of debt.
The changes in fair value of financial assets and liabilities represent the purely latent cost resulting from the evolution of the fair value of the non-effective hedges in the sense of IFRS. They evolve from € - 0.5 million to € -1.4 million (+ 213%) following the combined effect of the decrease of the interest rates and the recording in the non-effective hedges of the IRS of 20 million concluded in December 2010 (impact of IAS 39).
In total the financial result (negative) increases by 71.5% to € - 4.1 million.
After taking into account the financial charges and taxes, the net result of Home Invest Belgium grows from € 11.8 million in 2010 to € 14.8 million in 2011, or a rise by 25.6%.
The net current result decreases to € 6.3 million (- 8.7%), influenced by the negative change in fair value of the hedges (impact IAS 39). The net current result excluding IAS 39 reflects the improvement of the operational profitability of the company. It increases substantially (+ 4.99% in comparison with 2010).
The distributable result also rises from € 8.5 million in 2010 to € 10.2 million for 2011.
The apparent diverging evolution of these margins originates from the increase of the financial charges under the negative, though purely latent influence of IAS 39 on the accounting of the noneffective hedges.
The consolidated distributable result6 amounts to e 10.2 million compared to e 8.5 million last year.
It corresponds to a weighted average of shares with full dividend rights of 2 912 933 units.
No amount has been transferred to the legal reserve.
During the financial year, no event occurred which would have justified the formation of provisions as defined by IFRS standards.
Consequently, at the level of the statutory accounts, the Board of directors proposes to the Ordinary general meeting of shareholders of Home Invest Belgium:
• to carry forward a total amount of e 762 006.77
| Total | e 9 539 543.22 | |
|---|---|---|
| a dividend of € 3 per share, or | e 8 777 536.457 | |
| • to distribute in respect of return on capital |
The proposed dividend abides by the provision in article 27 of the royal decree of 7 December 2010 on Sicafi accounting, being above the 80% minimum distribution requirement of the sum of corrected profits and net capital gains from the sale of properties provided they are not exempt from the obligation of being distributed, reduced by the net reduction in the company's debt during the course of the financial year, as stated in the statutory annual accounts. This required minimum amounts to € 8 299 640.14.
In accordance with current legislation, this dividend will be paid gross for net (except for the application of the special contribution of 4% in case of exceeding the threshold of € 20 020 of income from movable assets) due to the special status of Home Invest Belgium8 as a Sicafi with at least 60% of its portfolio invested in residential property situated in Belgium. By way of reminder, these special tax provisions relating to exemption from withholding tax were introduced in 1995 in order to compensate, on the one hand, for the fact that the property tax cannot, itself, be passed on to tenants in residential properties and, on the other hand, for the costs of managing a housing stock which are disproportionate in comparison with those of professional properties such as offices or retail.
If approved by the General meeting, the dividend will be paid from 15 May 2012 by automatic transfer to holders of registered or dematerialised shares, and at branches of BNP Paribas Fortis, in return for coupon no. 15 detached from the current balance of the bearer shares.
Home Invest Belgium declares that the only participations it owns are
Home Invest Management SA, 100% subsidiary of van Home Invest Belgium, holds at closing date of the financial year 2011 a total of 12 912 Home Invest Belgium shares. At this date these shares were valued on a statutory level at e 58.65 per share or a total of e 757 322.67.
6 The statutory distributable result, calculated in accordance with the RD of 7/12/2010, amounts to € 10 374 550.
7 This dividend is determined on the basis of the statutory accounts.
8 See also point 11 of chapter I "Risk factors".
The Auditor, Karel Nijs, received fees amounting to a total of € 54 791.83 VAT included (on a consolidated basis), broken down as follows:
The risk factors are described in Chapter I of this Annual financial report.
Mr Guillaume Botermans, independent director and Chairman of the Audit Committee has the independence and competence required by the above-mentioned item 6 of Article 119 of the Company Code, with regard to accounting and auditing. He has a specific academic background in finance together with proven experience in the management of property certificates (see the Corporate Governance Statement Chapter).
On 3 May 2011, the Board of directors has appointed among its members, Mr Guy Van Wymersch-Moons, director, to take over the chairmanship of the Board of directors from Mr Michel Pleeck, resigning. Taking into account the important contribution of the latter to the launch and the development of the Sicafi, the Board of directors has decided to grant him the title of Honorary Chairman.
No important events took place since the closing of the financial year.
The outlook for the financial year 2012 has been established on a consolidated level and in a constant perimeter fashion, while nonetheless taking into account:
Taking into account the economic context, a careful hypothesis of 1.75% growth of the rents (inflation included) has been taken into consideration, while the occupancy rate has been forecasted at 95%.
The outlook has been established per building, based on the experience acquired in the past, and the thorough knowledge of the buildings of the management team, more specifically with regard to their occupancy rate, tenant turnover, rent level and operational maintenance and renovation costs.
With regard to the funding cost9 , the outlook takes into account the latest forecasts of interest rates on the money and capital markets, as well as the current situation of bank margins. That way, the supposition is that the 3-month interest rates (excluding margin) would amount to 1.25%, while the 5-year interest rates (IRS 5 years ex-margin) would reach 1.75%.
The Board of directors and Executive management can to a certain extent influence the following scenarios: the size of the portfolio, the level of rents, the occupancy rate and funding cost (margin). On the other hand, inflation speculations are completely outside their control.
9 The funding cost corresponds to the financial charges incurred on creditlines from banks.
Given the uncertainty due to the current economic situation, especially with regard to the development of the values of the property and those of the hedges, the forecasts published below will be limited to a couple of key figures for the financial year 2012, without making any forecasts regarding changes in the fair value of investment properties or hedges or forecasted balance sheets.
| Realized in 2011 |
Outlook for 2012 |
|
|---|---|---|
| Net rental result | 15 536 169 | 17 541 349 |
| Property result | 14 464 254 | 16 370 306 |
| Operating result before the portfolio result |
10 362 613 | 11 490 790 |
| Net result | 14 833 588 | 13 416 948 |
| Net result excluding IAS 39 | 7 711 706 | 7 766 519 |
| Net current result excluding IAS 39 per share |
2.65 | 2.55 |
| Distributable result | 10 202 475 | 10 264 554 |
| Distributable result per share | 3.50 | 3.37 |
Home Invest Belgium's mission – as exposed in the introduction of this report– consists of providing the population with decent housing, while paying attention to the interest of its shareholders. In order to reach this, the Sicafi recognizes its responsibilities in environmental and human matters for fulfilling its purpose. By this recognition, the company takes into account the social, environmental and ethical criteria prescribed by article 76 of the law of 20 July 2004.
Home Invest Belgium's responsibility is mainly perceived at the level of managing its property in operation and its investment decisions. As the owner of an important portfolio of buildings composed of buildings with a variable useful life, the company has developed a pragmatic policy matching a rational though permanent renovation programme to financial imperatives; that way, it can sometimes be recommended to sell an older building instead of spending large sums to improve its inadequate energy performance. This well-grounded policy with regard to investments and an active arbitrage on the portfolio relies on a detailed periodical portfolio evaluation. When deciding to invest in new assets, the quality of the new acquisition, which has to generate a rental income over a long period, is taken into account within the scope of complying with the best current environmental standards.
With regard to environmental respect the Sicafi wishes to apply that same sense of responsibility to the use of its own offices. As each company and/or employer, in close communication with its staff, it pays attention to the different aspects of its own functioning, such as energy consumption (heating- lighting -transportation), waste management (selective waste disposal-paper consumption and other consumables) and water consumption (maintenancecleaning). The application of these good management practices – however limited as to their impact – should make Home Invest Belgium's staff aware of the values the company respects in its operations.
The Sicafi recognizes in essence two groups of individuals it is closely connected to and towards whom it is responsible: its tenants and its staff.
Within this large human context Home Invest Belgium wishes to communicate a number of essential ethical values, as to all aspects of its functioning, namely honesty, integrity and equality. To its opinion, respecting these values is essential in order to correctly fulfil its mission to the benefit of all its 'stakeholders'. They are recognized and lived by, both at the level of the Board of directors and the Executive management and its entire staff, and consequently expressed in all the Sicafi's operations.
On 5 October 2011 a Board of directors treating the partial demerger of the SA V.O.P., mentioned sub 2.1.4, was held. As the directors Johan and Liévin Van Overstraeten are also directors and indirect shareholders of the aforementioned company V.O.P., the transaction project was qualified as a potential conflict of interest in the sense of article 523 of the Company Law, article 19 of the articles of association and the articles 4.7.2 and 4.8 of the Corporate Governance Charter of the Sicafi. In accordance with the legal provisions in force, the directors have informed the Chairman of the Board of directors and the Auditor on 4 October 2011 of the existing potential conflict of interest and their decision not to take part in the deliberation on this point. This abstinence has been recorded accordingly in the minutes of the meeting of the Board of directors of 5 October 2011, of which the relevant extracts are integrally reproduced below in accordance with the provision of article 523 § 1 of the Company Code:
Given their connection with VOP, the directors Liéven and Johan VAN OVERSTRAETEN have informed the Chairman of the Board of directors and the auditor, in accordance with article 523 §1 of the Company Law, of the potential conflict of interest that exists for the transaction project, and they have announced to abstain from voting on this item of the agenda.
It relates to the acquisition by HIB, as a consequence of a partial demerger, of a number of buildings owned by the company VOP, i.e.:
Together with the partial demerger VOP will sign a Project Management agreement for the turnkey delivery of the project "Odon Warland", within the scope of which VOP will take charge of the further follow-up of the project, including the payment of the construction costs all-in till its provisional acceptance (in other words, including building contractor's invoices, fees, VAT, taxes, etc., at the unique exception of the value of the land which is fixed at € 1 650 000), for a maximum amount of € 4 165 000.
In exchange, the shareholders of VOP will receive new Home Invest Belgium shares. The issue price of the new shares will be defined based on the average closing price of the 30 calendar days preceding the partial demerger date, with as a bottom price the latest published net asset value that will be communicated on 17 November (situation per 30/09/2011).
The parties have also agreed that possibly a surcharge in cash will be paid if the effectively concluded rent exceeds the forecasted rent by at least 4%; this possible surcharge will be calculated as follows:
Liéven and Johan VAN OVERSTRAETEN are connected to the company V.O.P. through their directors' mandates; they are also indirect shareholders of this company. The valuations of the property involved in the realization of the partial demerger project as well as the issue conditions of the new Home Invest Belgium shares consequently entail opposite interests between HIB and VOP.
As mentioned above, the operation consists of two parts: The first part relates to the acquisition of a well-located project in Jette, at the corner between the Avenue Odon Warland and the rue Bulins, turnkey project constructed by VOP according to state-ofthe-art techniques with extra focus on the best possible energy performance. This building is destined for letting and consequently perfectly fits within the purpose of the Sicafi.
According to the current expectations, the return on this investment should amount to between 5.75% and 6%, or an appreciable initial yield with nice future capital gains potential on top of it. Moreover, through this investment, our Sicafi takes into account the social, environmental and ethical criteria as mentioned in point 2.6 of the annual report on the 2010 accounts.
The second part relates to the acquisition by Home Invest Belgium of a leasehold right of 60 years on four existing investment properties located in the Brussels-Capital Region, and mainly let for housing. Also this fits seamlessly within the core business of our Sicafi, i.e. investing in real estate, mainly with a residential purpose.
The two parts of the operation also contribute to the further risk diversification of the property portfolio, via the presence in districts where Home Invest was not invested up until now.
IV. As to the consequences for the property portfolio, the proposed operation as described above will result in the reinforcement of the shareholders' equity of our Sicafi for an amount of € 7 454 000, which further extends its borrowing capacity for the future.
On the other hand, as remuneration, a number of new shares will be issued based on the issue conditions described above in point I. With regard to this, it is the Board of director's opinion, that except for a significant reversal of the share's price in the two coming months, the issue price of the new shares should turn out to be higher than the latest net asset value of the share to be communicated next 17 November, resulting in an accretive effect for the current shareholders. Anyhow, parties have agreed that the latest net asset value will account for the minimum issue price, excluding an issue with a dilutive effect.
Finally, following this operation, Home Invest Belgium will globally further reinforce its prominent presence in the Brussels rental market, which perfectly fits within its purpose."
The Corporate Governance statement, integrally part of this management report, is produced in chapter 7 hereafter.
Home Invest Belgium carried out no research or development during the financial year 2011.
The Board of directors has no indication of circumstances with a possible significant influence on the development of the Sicafi in the sense of article 119, 3° of the Company Code.
The objectives and the policy of the company with regard to financial risk management, its exposure to credit, price, liquidity and treasury risks, and to hedges and their use, are described in chapter 1 above.
Given the favourable legal set up of the Sicafi in general, and of residential Sicafi in particular, shareholdings in Home Invest Belgium can make for interesting investments for private and institutional investors alike.
In comparison with the direct ownership of residential property, an investment in Home Invest Belgium shares has a number of advantages; this allows to
The Board of directors proposes to the General meeting of shareholders that it grants discharge to the directors and the Auditor in respect of their mandates in separate votes for the financial year ending 31 December 2011.
A description of the main characteristics of the internal control systems and risk management is produced in point 2 of chapter VII Corporate Governance statement of this annual financial report.
The remuneration report is reproduced in point 6 of chapter VII "Corporate Governance statement", an integral part of this annual financial report.
The Auditor has gone over this management report and has confirmed that the information communicated is in no way inconsistent with the information he has within the framework of his mandate.
His report is incorporated in the report on the consolidated annual accounts, produced in point 8 of the Financial statements hereafter.
The Home Invest Belgium share is listed on Euronext Brussels' continuous trading market (Symbol: HOMI - ISIN Code: BE0003760742).
The first closing price of 2011, namely the price of 3 January 2011, amounted to € 61. It remained relatively steady during the 1st quarter of the financial year to subsequently record a quasi constant increase till the year's high of € 67.99 on 6 June. Under the influence of the renewal of the economic difficulties, the price has then slightly decreased to reach its lowest level of 60.90 on 9 August. The last month of the year is characterized by a regular leap of the share price till € 64.05 on 30 December 2011, or 5% better than at the beginning of the year. We also need to point out that the share price seemed insensible to the detachment of the coupon on 13 May.
This new progression of 5% in the course of 2011, after an increase of 10% in 2010, sharply contrasts with the strong drop of the BEL20 index (- 17.73%), as well as that of the EURO STOXX 50 index, decreasing by 15.51% in the course of the year under review.
At a share price of € 64.05, last closing price of 2011, the net yield based on the € 3 dividend proposed to the ordinary general meeting of the Sicafi of 2 May 2012 amounts to 4.68%, or superior by 190 base points to the current yield of 5 year-OLO2 .
Last year, the net return for the shareholders, measured in the same way, reached a quasi identical level of 4.48%.
Volume Share price
Comparison of the stock market evolution: Home Invest Belgium - BEL20 - EPRA Belgium index since the IPO3
Calculated from 18 June 1999, the first day Home Invest Belgium shares were listed, to 31 December 2011, the stock market performance of Home Invest Belgium shares has undoubtedly been far better than the performance of the EPRA Belgium or BEL20 indices, particularly in the course of the financial years 2009, 2010 and 2011.
3 Additional information on these indices can be obtained at NYSE Euronext Brussels for the BEL20 index and for the EPRA Belgium index, on the website www.epra.com (EPRA Belgium).
Evolution of the share price compared to the net asset value
The net asset value per share is calculated and published quarterly by way of a press release and publishing on the website www. homeinvestbelgium.be.
In the course of the financial year 2011 this value has recorded an increase of 4.3% in comparison with its level at the start of the financial year, i.e. from € 54.68 to € 57.58 per 31 December 2011.
This positive trend, more pronounced during the second half-year, can essentially be explained by the very good results realized by the Sicafi, as well with regard to letting property, as with regard to the arbitrage of certain buildings, without omitting the increase of the fair value of certain buildings in portfolio and of the results carried forward.
It is worth noting that the net asset value per share is currently 67% higher than its initial level of € 34.46 on its stock market debut in June 1999. This evolution reflects the quality of the property investments made by Home Invest Belgium and its asset management, as well in terms of maintenance-renovation as regarding the timing of the sale of individual units for buildings judged as ready for sale.
Home Invest Belgium shares have been traded at a premium on the published net asset value during the entire financial year 2011. On 30 December 2011 the closing price amounted to € 64.5 (€ 60.5 on 31 December 2010), which represents a premium of 12% in comparison with the net asset value at the end of the financial year (10.6% in 2010). This growing premium is undoubtedly due to the reinforced confidence of the shareholder in the reassuring performance of an investment in Home Invest Belgium shares.
| Number of issued shares: | 3 056 143 |
|---|---|
| Number of shares admitted to stock market trading: | 2 828 542 |
| Market capitalisation based on closing price: | e 197.1 million |
| Closing price: | e 64.50 |
| Highest price: | e 67.99 |
| Lowest price: | e 58.87 |
| Average price: | e 62.99 |
| Annual turnover: | 222 912 (against 201 493 in 2010, 241 645 in 2009 and 157 037 in 2008) |
| Average monthly volume: | 18 576 (against 16 791 in 2010, 20 137 in 2009 and 13 086 in 2008) |
| Average daily volume: | 902 (against 833 in 2010, 986 in 2009 and 685 in 2008) |
| Velocity1 : |
15.40% (against 13.85% in 2010,16.69% in 2009 and 11% in 2008) |
| Gross dividend: | e 3.00 per share |
| Gross dividend yield2 (%): |
4.65% |
1 Number of trade shares / free float.
2 Gross dividend / closing price at 30 December 2011.
Home Invest Belgium is committed to offering its shareholders an increasing dividend at least equal to or above the rate of inflation in the long run. Between 2000 and 2011, the net dividend rose from € 1.96 to € 3.00 per share, or an increase of 53% in the space of twelve years or also an average annual increase of over 4%. In the same period, the 'health index' (l'indice santé) amounted to 2.16% annually.
For the 2011 financial year, the proposed dividend of € 3 represents again an important growth by 9% compared to the dividend of € 2.75 paid for the 2010, while the payout ratio is maintained at an acceptable though careful level of 85.65%4 .
This strong growth of the dividend was made possible thanks to the reinforcement of the arbitrage volume on the portfolio, for which the Board has fixed an objective of +/- 4% per year. As discussed in point 1. of chapter IV, it is the Board's opinion that this policy will allow a substantial contribution to the growth of the distributable result in the coming years.
It has to be pointed out that since the creation of the Sicafi quite a sizeable portion of profits was carried forward each year that, after distribution and on a consolidated level now amounts to € 2.76 per share5 . This should enable the company to maintain dividends in the future, should conditions in the property market become more difficult.
The return on investment is to be measured both with regard to the immediate yield that can be derived, and to the increase in net asset value that the investment may present in the long term. The addition of these two components constitutes the annual return on investment.
In the case of a Sicafi, the importance of the immediate return may be high, but the capacity to generate capital gains is the true seal of quality in the long term.
For shareholders who took part in the June 1999 IPO (Initial Public Offering) and since reinvested all dividends in Home Invest Belgium shares, the internal rate of return (IRR) calculated over this twelve year period would be 13.87%, and this, in spite of the weak performance in the course of the financial years 2008 and 2009.
In the same way, the return for Home Invest Belgium shareholders not having reinvested dividends every year, the average return is nonetheless equal to 11.52% per year over the 1999/2011 period.
This return cannot be compared with that of the majority of other Sicafi, due to the fact that their return is calculated before deduction of the withholding tax on dividends, whereas Home Invest Belgium is not subject to such withholding tax according to the current legislation.
4 The statutory payout ratio amounts to 84.61%. In 2010, it amounted to respectively 90.99% on a consolidated basis and to 89.06% on a statutory basis.
5 Calculations on a consolidated basis and after 2011 profits appropriation.
| Return (€)1 | Net asset value excluding dividend |
Value growth | Gross/net dividend |
Return per share2 |
Return in % for the shareholder3 |
|
|---|---|---|---|---|---|---|
| 31/12/2011 | 54.58 | 2.65 | 3 | 5.65 | 10.88% | |
| 31/12/2010 | 51.93 | 1.42 | 2.75 | 4.17 | 8.26% | |
| Consolidated accounts | 31/12/2009 | 50.51 | 0.16 | 2.43 | 2.59 | 5.14% |
| in IFRS | 31/12/2008 | 50.35 | -2.17 | 2.36 | 0.19 | 0.36% |
| 31/12/2007 | 52.52 | 3.21 | 2.3 | 5.51 | 11.17% | |
| 31/12/2006 | 49.31 | 3.35 | 2.24 | 5.59 | 12.16% | |
| 31/12/2005 | 45.96 | 4.17 | 2.19 | 6.36 | 14.47% | |
| 31/12/2005 | 46.91 | 4.24 | 3.47 | 7.71 | 11.41%4 | |
| 31/05/2004 | 42.67 | 4.13 | 2.16 | 6.29 | 16.32% | |
| Statutory accounts | 31/05/2003 | 38.54 | 1.15 | 2.13 | 3.28 | 8.77% |
| in Belgian GAAP | 31/05/2002 | 37.39 | 0.44 | 2.07 | 2.51 | 6.79% |
| 31/05/2001 | 36.95 | 1.19 | 2.02 | 3.21 | 8.98% | |
| 31/05/2000 | 35.76 | 1.3 | 1.96 | 3.26 | 9.46% | |
| 01/06/1999 | 34.46 |
1 Based on consolidated figures as from 2005.
2 Dividend of the financial year plus net asset value growth during the financial year.
3 Idem, divided by the net asset value at the beginning of the financial year.
4 Rebased to twelve months (12/19).
The quality of an investment in Home Invest Belgium shares is perfectly demonstrated by the graph above, showing the excellent performance – measured in terms of return – of the Home Invest Belgium share compared to the BEL20, EURO STOXX 50 and EPRA Europe return indices. It is noteworthy to record that, notwithstanding the heavy economic crisis context during 2008 and 2009, this return has remained largely positive during the entire period under review.
The table below lists Home Invest Belgium's registered shareholders and those who have issued a transparency statement, in line with the statements received by the company (status on 24 February 2012):
| Shareholders | Number of shares |
% of capital |
|---|---|---|
| Group Van Overstraeten*1 | 762 692 | 24.96% |
| COCKY SA | 110 | 0.00% |
| Mr Liévin Van Overstraeten | 128 671 | 4.21% |
| Mr Antoon Van Overstraeten | 127 714 | 4.18% |
| Mr Hans Van Overstraeten | 128 569 | 4.21% |
| Mr Johan Van Overstraeten | 130 605 | 4.27% |
| Mr Bart Van Overstraeten | 128 568 | 4.21% |
| Stavos Luxembourg | 118 455 | 3.88% |
| AXA Belgium*2 | 433 164 | 14.17% |
| Les Assurances Fédérales* | 105 296 | 3.45% |
| Group ARCO*3 | 102 575 | 3.36% |
| Arcopar SCRL | 77 575 | 2.54% |
| Auxipar SA | 25 000 | 0.82% |
| Family Van Overtveldt - Henry de Frahan* | 102 792 | 3.36% |
| Mr S. Van Overtveldt | 51 396 | 1.68% |
| Mrs P. Henry de Frahan | 51 396 | 1.68% |
| Other nominative shareholders | 118 364 | 3.87% |
| Total known | 1 624 883 | 53.17% |
| Free Float | 1 431 260 | 46.83% |
| General total |
3 056 143 | 100.00% |
* Shareholders having issued a transparency statement in accordance with the Transparency Legislation of 2 May 2007.
1 Stavos Luxembourg SA is controlled for 100 % by the 'Stichting Administratiekantoor Stavos'. Stichting Administratiekantoor Stavos is controlled by Liévin, Antoon, Hans, Johan and Bart Van Overstraeten. Cocky NV is controlled for 99 % by the Partnership Van Overstraeten, in its turn controlled for 100% by the "Stichting Administratiekantoor Stavos".
2 AXA Belgium is a subsidiary of AXA Holdings Belgium, itself a subsidiary of AXA SA. 3 Arcopar SCRL and Arcoplus SCRL constitute a consortium. Auxipar SA is under the joint control of Arcopar SCRL (and its subsidiary Arcofin SCRL) and Arcoplus SCRL.
It is worth remembering that article 8 of Home Invest Belgium's articles of association expressly provides for the obligation of any shareholder increasing or decreasing his shareholding to the respective thresholds of 3%, 5% or a multiple of 5% of capital to give notice of such to the Sicafi and the Financial Services and Markets Authority (FSMA) via a transparency statement.
Consequently, the company's free float represents 46.83% of total capital, represented by 3 056 143 on 24 February 2012.
There is no dominant shareholder controlling the Sicafi and there is no provision in the deed of constitution, the articles of association, any charter or any other internal regulation which could have the effect of delaying, deferring, or preventing a change of control.
All shares have the same voting rights.
The 12 912 shares held by Home Invest Management, a 100% subsidiary of Home Invest Belgium, are a result of the mergers with the companies Investim and Immobilière Van Volxem in 2007 and JBS in 2008.
Any amendment to the rights of shareholders requires an amendment of the articles of association (set forth in the Permanent Document), in accordance with the provisions of the Company Code.
< "Giotto" - Evere (1040 Brussels)
The following items 1 and 2 have been transcribed from the report of the certified real estate surveyor, with his agreement, while the following items contain supplementary details, mainly based on balance sheet data or taken from various regular assessment reports issued by the certified real estate surveyor.
Surveyor's report of Winssinger & Associates SA on 31 December 2011:
Compared to the investment level reached at the end of the first three quarters of 2010, the residential market records a progression of 4.4% to stand at nearly € 20 billion at the end of the third quarter of 20111 (Figure 1), while the number of transactions listed in the kingdom decreases by 0.1%. Consequently, we note an increase of the property values if we align both periods, while the inflation level (cf. table below) in 2011 is higher than in 2010.
Source: SPF Economie
This investment level can a/o be explained by the decrease of the fixed interest rates on mortgages in the course of 2011 to reach a rate of 3.93% in September (Figure 11). Total amount of mortgages amounts to over € 18 billion, a level comparable to that of the first three quarters of 2010.
| Annual evolution (%) | 2010 | 2011 | 2012 | 2013 |
|---|---|---|---|---|
| GDP | 2.3 | 2.1 | 0.6 | 2.1 |
| Private consumption | 2.3 | 0.7 | -0.3 | 1.4 |
| Inflation | 2.2 | 3.5 | 1.8 | 1.7 |
Source: Oxford Economics (16 December 2011)
As shown by the analyses per type op property below, the average prices of ordinary houses, luxury homes and apartments all record an increase of nearly or equal to 4% in comparison with 2010, while only building land slightly declines by 0.3%. In 2011 the number of transactions for this type of property remains at a level comparable to that of 2010, with 47 000 purchases.
1 The figures of the FPS Economy are a basis for this report. At present (1 February 2012) these have no further been actualized than including the third quarter of 2011. For reasons of coherence the comparisons with 2010 will only be based on the first three quarters of 2011.
The average price of ordinary houses grows by 4.0% and stands at € 187 000. The number of transactions (47 000) for this type of property has increased by 2.2% (Figure 2).
According to the figures of the FPS Economy the average price of an ordinary house in the Brussels-Capital Region was € 346 000, or an increase of 1.8% in 2011. As demonstrated by Figure 3, six municipalities in the Brussels-Capital Region record an average price below € 276 000 at the end of 2011: Anderlecht, Berchem-Sainte-Agathe, Jette, Koekelberg, Molenbeek-Saint-Jean, and Saint-Josse-ten-Noode. It has to be pointed out that Ganshoren has in the meanwhile exceeded the € 276 000 limit.
The average price of ordinary houses in the Flemish Region amounts to € 201 000 in 2011, or a rise by 6.3% compared to 2010. As indicated on the map (Figure 3), the highest price levels at the end of the year are essentially located in the zone covering the Brussels periphery to Leuven. Different coastal cities, amongst which Knokke-Heist, also record high price levels. The most affordable prices are still situated in the provinces Limburg and Western Flanders.
In 2011 the prices of ordinary houses in the Walloon Region reach e 142.000 on average or an increase of 3.3% in comparison with the previous year. The 'Brabant wallon' counts different municipalities currently exceeding the e 276 000 threshold, amongst which Ottignies-Louvain-la-Neuve and Ramillies. In the 'Hainaut' Silly is as from now on listed among the most expensive municipalities of Wallonia.
Figure 5
The average price amounts to e 329 000, or an increase by 3.8%. The number of transactions in villas and luxury homes in 2011 stands at a comparable level to that of 2010, with more than 12 000 purchases (Figure 4).
Figure 4: Average price and transactions in villas and luxury homes
The average price of villas amounted to e 1 048 000 in the Brussels-Capital Region in 2011, or an important progression by 17.5% in comparison with the previous year, nevertheless coloured by the small sample of this type of buildings in the Region. The municipalities Uccle and Woluwe-Saint-Pierre are the only two where these types of transactions have been recorded at the end of the year (Figure 5).
The average price of luxury homes and villas in the Flemish Region stands at e 352 000, or an increase by 4.7% compared to 2010. Figure 5 shows a drop of the average price of luxury homes in the province of Antwerp, and a price increase in the municipality of Tervueren, which remained below the e 551 000 threshold till the second quarter.
The average price of luxury homes and villas in the Walloon Region amounts to e 262 000, or an increase by 2.5% in comparison with the previous year.
The global rise of the average prices of apartments amounts to 3.9% since 2010. The average price reaches e 193 000 in 2011. However, the number of transactions in apartments has decreased by 1.08%; more specifically, less than 28 000 were recorded (Figure 6).
For the Brussels apartments the average price was e 206 000 in 2011, or a progression of 3.6% compared to 2010. The highest average price is still to be found in Woluwe-Saint-Pierre, while we observe an increase of the average prices in the municipalities Schaerbeek and Auderghem, and a decrease in Watermael-Boitsfort (Figure 7).
In the Flemish Region the average stood at e 198 000, representing a rise of 4.7% in comparison with 2010. A number of coastal cities and municipalities around Antwerp namely succeed in exceeding the e 276 000 threshold at the end of 2011.
The average price of apartments in the Walloon Region has risen by 4.1% in comparison with 2010, to reach e 150 000.
The average price of building land records a decrease of 0.3% compared to 2010 to reach e 102/m² on average. 12.256 transactions in this type of property were listed in 2011 (Figure 8). This evolution is probably not reflecting the real situation as it was influenced by a negative trend in Brussels, the latter being based on a limited number of transactions.
Figure 8: Average prices and transactions in building land
The average price of building land sold in the Brussels-Capital Region amounts to e 427/m², or a decrease of 4.0% in comparison with the previous year (Figure 8). Transactions were only recorded in the municipalities Jette and Uccle at the end of 2011 (Figure 9).
Building land in the Flemish Region reached an average level of e 157/m², or a growth by 1.6% compared to 2010. Certain coastal cities and municipalities on the axis Antwerp-Brussels comprise the most expensive building land of the Region.
We can point out that the price of building land in the Walloon Region has increased by 1.6% in comparison with the previous year and stands at e 48/m² on average, however well below the levels observed in the Flemish and the Brussels-Capital Region. No single building land transaction reached the e 300/m² threshold at the end of 2011.
The real estate activity index of the Federation of Notaries (Figure 10) is stabilized in the first half-year of 2011 to subsequently decrease in the third quarter, as is usual in the summer holiday period. However, the index was higher in the third quarter than in the third quarter of 2010. The figures of the National Bank of Belgium (Figure 11) show that the total amount of mortgages granted to households has continuously decreased between May and August; this coincided with a rise of the interest rates for mortgages between January and July. We also record that, despite the decrease of the fixed interest rates reaching a bottom level of 3.72% in November, the number of mortgages granted to households, the main buyers of property, keeps decreasing at the beginning of the fourth quarter, while in 2010 the biggest volume of granted mortgages during the year was recorded in that period.
Despite the growth of the investment volumes in residential property in comparison with 2010, the total number of transactions slightly drops. The real estate agents state that demand remains strong, but that the households' time to reflect on the sale is extended, given the current climate of doubt. Moreover, the economic situation results in an increasing number of candidate buyers not being granted a mortgage. In addition, and this since over a year, certain buyers were encouraged to advance their purchases, before the interest rates would rise; we have thus been confronted with a concentration of the purchases over a short period in stead of a more proportional breakdown. These factors explain the decreasing number of purchases in 2011.
The average price of ordinary houses on the Belgian territory increases by 4.0% in 2011; this type of property also records a rise of the number of transactions by 2.2%. The highest average price of ordinary houses over the three Region is to be found in the Brussels-Capital Region, at € 346 000.
The average price of luxury homes has again progressed in the three Regions, to reach e 329 000 in 2011. The number of transactions has only slightly progressed by 0.5%. The Brussels-Capital Region records the top average price for a luxury home, namely e 1 048 000, of a rise of 17.5% in comparison with 2010!
The average price level of apartments grows in the three Regions. In the Brussels-Capital Region the highest average price has been listed: e 206 000. The number of transactions in this type of property has decreased by 1.8% in 2011.
Finally, the average building land prices decrease by 0.3%. The number of transactions declines by 4.9% in comparison with the previous year. The most expensive building land is found in the Brussels-Capital Region at e 427/m² on average.
"Ladies and gentlemen,
In compliance with legal and statutory provisions, we are proud to provide you with our opinion on the Investment Value of the portfolio belonging to the Sicafi HOME INVEST BELGIUM as of 31 December 2011.
We have carried out our valuations using the NPV-method of the rental income and in compliance with International Valuation Standards (IVS) and RICS ('Royal Institution of Chartered Surveyors').
As is customary, our mission is executed on the basis of information provided by HOME INVEST BELGIUM regarding the rental status, charges and taxes to be paid by the lessor, the works to be done, together with any other factors influencing property values. We presume this information to be exact and complete.
As stated explicitly in our valuation reports, these do not include any structural or technical examination of properties or any analysis of the possible presence of harmful materials. These factors are well known by HOME INVEST BELGIUM which manages its portfolio in a professional manner, and is well aware of possible risk factors, and therefore proceeds with the necessary technical and legal due diligence before acquiring any property.
The investment value is defined as the value most likely to be reasonably obtained under normal selling conditions between consenting and well-informed parties, before deduction of transfer costs.
The fair value can be obtained as follows:
An analysis of sales realised on the Belgian market in the 2003 – 2005 period shows an average rate of 2.5% for transfer rights for properties sold 'en bloc' with an investment value exceeding € 2 500 000.
This 2.5% rate will be reviewed periodically and adjusted insofar as the gap shown for the institutional market exceeds +/- 0.5%.
In our analysis of Home Invest Belgium's portfolio, we have arrived at the following findings:
On the basis of the remarks made in the previous paragraphs, we confirm that the investment value of Home Invest Belgium's property portfolio on 31 December 2011 amounts to e 272 247 567 (two hundred and seventy-two million, two hundred and fortyseven thousand five hundred and sixty-seven euro).
The likely realisable value of Home Invest Belgium's property portfolio on 31 December 2011 corresponding to its fair value in the sense of IAS/IFRS is set at e 245 975 978 (two hundred and forty-five million, nine hundred and seventy-five thousand, nine hundred and seventy-eight euro).
Yours faithfully,
Brussels, 2 February 2012 WINSSINGER & ASSOCIES SA
Fabian DAUBECHIES * MRICS Benoît FORGEUR * Director Managing director"
2 These calculations are based on parameters which differ from those used by Home Invest Belgium and are thus based on the investment value of the property portfolio and include the buildings that are for sale.
3 The occupancy rate is calculated as of 31 December 2011 and differs from that published by Home Invest Belgium, which represents the average occupancy rate during the whole financial year, excluding the buildings held for sale.
| In e | Fair value | Investment value of the portfolio |
Current gross rent + rental guarantees on unoccupied premises (annual) |
ERV (estimated rental value) |
Occupancy rate |
Gross yield |
|---|---|---|---|---|---|---|
| 31/12/2011 | 245 975 978 | 272 247 567 | 16 826 762 | 15 072 907 | 95.38% | 6.18% |
| 31/12/2010 | 222 773 965 | 246 558 323 | 15 173 976 | 13 643 207 | 94.61% | 6.15% |
| 31/12/2009 | 209 363 518 | 229 001 892 | 14 400 972 | 12 742 494 | 94.60% | 6.29% |
| 31/12/2008 | 199 144 677 | 218 821 398 | 13 279 535 | 12 068 321 | 96.00% | 6.07% |
| 31/12/2007 | 162 189 760 | 179 553 208 | 10 921 718 | 9 688 010 | 96.99% | 6.08% |
| 31/12/2006 | 140 931 777 | 154 250 086 | 9 635 516 | 8 537 563 | 96.77% | 6.22% |
| 31/12/2005 | 118 106 816 | 128 939 823 | 8 348 966 | 7 516 226 | 91.26% | 6.48% |
| 31/05/2004 | N/A | 84 573 857 | 6 310 785 | 5 788 461 | 97.79% | 7.46% |
| 31/05/2003 | N/A | 66 927 850 | 5 249 790 | 4 861 780 | 97.34% | 7.84% |
| 31/05/2002 | N/A | 57 288 245 | 4 654 442 | 4 218 134 | 97.35% | 8.12% |
| 31/05/2001 | N/A | 51 361 059 | 4 176 994 | 3 839 018 | 97.67% | 8.13% |
| 31/05/2000 | N/A | 44 261 389 | 3 586 592 | 3 407 872 | 99.01% | 8.10% |
| 01/06/1999 | N/A | 43 181 416 | 3 393 792 | 3 401 772 | 99.45% | 7.86% |
On 31 December 2011, the fair value of the consolidated portfolio (investment properties and assets held for sale) amounted to € 246 million, while the investment value reached € 272.2 million.
The average occupancy rate for the entire year amounted to 95.38%, compared to 94.61% in 2010, reflecting the efficiency of the commercial policy of the Sicafi in a still difficult market.
It is worth noting that the three segments of Home Invest Belgium's portfolio are characterised by the following gross yields according to the investment value:
| Situation of the property portfolio on 31 December 20111 |
Year2 | Units | Surface | Gross passing rent3 |
ERV4 | Effective rent5 |
Occupancy rate6 |
|
|---|---|---|---|---|---|---|---|---|
| Name | District | Number | m² | e | e | e | % | |
| Brussels Capital Region | 817 | 89 498 | 11 193 809 | 9 979 130 | 10 790 949 | 95.9% | ||
| Belliard | Brussels | 1937 | 18 | 2 256 | 354 433 | 278 172 | 344 933 | 95.4% |
| Clos de la Pépinière | Brussels | 1993 | 25 | 3 275 | 443 552 | 402 192 | 429 752 | 92.4% |
| Lebeau | Brussels | 1998 | 12 | 1 153 | 252 996 | 175 205 | 252 996 | 98.6% |
| Résidences du Quartier Européen | Brussels | 1997 | 50 | 4 290 | 618 082 | 515 348 | 523 128 | 86.6% |
| Birch House | Etterbeek | 2001 | 32 | 3 438 | 492 876 | 431 414 | 483 276 | 96.9% |
| Erainn Yser |
Etterbeek Etterbeek |
2001 1974 |
12 15 |
1 252 1 961 |
203 801 299 132 |
176 695 250 738 |
198 301 293 032 |
97.6% 98.7% |
| Giotto | Evere | 2005 | 85 | 8 647 | 1 193 911 | 1 064 687 | 1 153 314 | 97.0% |
| Alliés - Van Haelen | Forest | 1999 | 35 | 4 189 | 394 074 | 356 142 | 379 824 | 97.7% |
| Belgrade | Forest | 1999 | 1 | 1 368 | - | - | - | 100.0% |
| La Toscane | Ixelles | 1975 | 1 | 65 | 6 506 | 7 280 | 6 506 | 100.0% |
| Les Jardins de la Cambre | Ixelles | 1992 | 28 | 3 552 | 461 099 | 398 150 | 457 499 | 97.0% |
| Charles Woeste (appartements) | Jette | 1998 | 92 | 5 091 | 538 412 | 465 464 | 527 841 | 98.0% |
| Charles Woeste (commerces) | Jette | 1996 | 14 | 2 995 | 395 679 | 320 473 | 395 679 | 100.0% |
| De Wand | Laeken | 1960 | 3 | 208 | 26 110 | 28 150 | 26 110 | 100.0% |
| Houba de Strooper | Laeken | 1954 | 11 | 860 | 80 208 | 78 200 | 80 208 | 100.0% |
| Baeck | Molenbeek-Saint-Jean | 2001 | 28 | 2 652 | 230 502 | 231 420 | 230 502 | 99.4% |
| Lemaire | Molenbeek-Saint-Jean | 1990 | 1 | 754 | - | - | 100.0% | |
| La Toque d'Argent | Molenbeek-Saint-Jean | 1990 | 1 | 1 618 | 189 219 | 154 608 | 189 219 | 100.0% |
| Sippelberg | Molenbeek-Saint-Jean | 2003 | 33 | 3 290 | 373 370 | 349 250 | 366 620 | 96.9% |
| Albanie | Saint-Gilles | 1937 | 4 | 135 | 16 226 | 17 550 | 16 226 | 100.0% |
| Bosquet - Jourdan | Saint-Gilles | 1997 | 27 | 2 326 | 288 508 | 266 055 | 288 508 | 98.6% |
| Jourdan - Monnaies Jourdan 85 |
Saint-Gilles Saint-Gilles |
2002 2010 |
26 24 |
2 814 2 430 |
350 895 359 616 |
319 354 347 524 |
341 035 352 056 |
96.2% 94.6% |
| Parvis St Gilles | Saint-Gilles | 1930 | 6 | 353 | 38 649 | 40 600 | 38 649 | 100.0% |
| Lambermont | Schaerbeek | 2008 | 131 | 14 110 | 1 646 580 | 1 581 355 | 1 578 442 | 96.5% |
| Sleeckx | Schaerbeek | 1895 | 6 | 279 | 26 146 | 26 985 | 26 146 | 100.0% |
| Soquet | Schaerbeek | 1970 | 1 | 300 | 15 000 | 15 000 | 15 000 | 100.0% |
| Alsemberg | Uccle | 1960 | 1 | 90 | 11 187 | 11 250 | 11 187 | 100.0% |
| Melkriek | Uccle | 1998 | 1 | 1 971 | 260 928 | 210 578 | 260 928 | 100.0% |
| Ryckmans | Uccle | 1990 | 8 | 2 196 | 272 847 | 230 580 | 272 847 | 94.9% |
| Winston Churchill | Uccle | 2006 | 11 | 1 733 | 220 286 | 207 249 | 199 358 | 89.3% |
| Georges Henri | Woluwe-Saint-Lambert | 1971 | 4 | 365 | 32 708 | 36 225 | 32 708 | 100.0% |
| Les Erables | Woluwe-Saint-Lambert | 2001 | 24 | 2 202 | 343 079 | 363 838 | 337 080 | 97.5% |
| Les Mélèzes | Woluwe-Saint-Lambert | 1995 | 37 | 4 357 | 612 442 | 497 616 | 557 618 | 95.3% |
| Voisin | Woluwe-Saint-Pierre | 1996 | 9 | 923 | 144 750 | 123 783 | 124 421 | 94.7% |
| Flemish Region | 159 | 15 326 | 2 252 282 | 2 202 006 | 2 065 713 | 92.1% | ||
| Nieuwpoort (commerces) | Nieuwpoort | 1997 | 1 | 296 | 30 069 | 59 200 | 30 069 | 100.0% |
| Grote Markt | Sint-Niklaas | 2004 | 17 | 2 752 | 381 156 | 352 441 | 376 655 | 98.2% |
| Wiezelo | 's Gravenwezel | 1997 | 13 | 1 297 | 168 419 | 156 735 | 166 979 | 97.8% |
| City Gardens | Leuven | 2010 | 106 | 5 236 | 1 030 756 | 1 020 352 | 960 798 | 88.2% |
| Haverwerf | Mechelen | 2002 | 4 | 3 399 | 455 000 | 414 678 | 374 480 | 93.9% |
| Gent Zuid | Ghent | 2000 | 18 | 2 346 | 186 882 | 198 600 | 156 732 | 100.0% |
| Walloon Region | 235 | 25 224 | 2 865 160 | 2 482 634 | 2 742 264 | 95.3% | ||
| Clos Saint-Géry | Ghlin | 1993 | 1 | 4 140 | 339 300 | 188 400 | 339 300 | 100.0% |
| Place du Jeu de Balle | Lasne | 1999 | 7 | 1 198 | 164 468 | 153 329 | 162 068 | 98.2% |
| Quai de Compiègne | Huy | 1971 | 1 | 2 479 | 190 089 | 168 572 | 190 089 | 100.0% |
| Galerie de l'Ange (appartements) | Namur | 1995 | 50 | 1 880 | 265 121 | 215 757 | 265 121 | 99.1% |
| Galerie de l'Ange (commerces) | Namur | 2002 | 12 | 2 552 | 650 957 | 543 095 | 650 957 | 100.0% |
| Florida | Waterloo | 1998 | 6 | 1 760 | 160 069 | 158 400 | 160 069 | 98.5% |
| Léopold Mont Saint Martin |
Liège Liège |
1988 1988 |
53 6 |
3 080 335 |
311 985 37 854 |
303 580 35 635 |
299 279 21 854 |
87.1% 73.6% |
| Quai de Rome | Liège | 1953 | 27 | 2 490 | 179 762 | 202 340 | 160 612 | 96.7% |
| Saint Hubert 4 | Liège | 1988 | 14 | 910 | 90 490 | 89 750 | 51 550 | 56.2% |
| Saint Hubert 51 | Liège | 1988 | 4 | 360 | 39 660 | 42 480 | 15 660 | 68.3% |
| Colombus | Jambes | 2007 | 51 | 3 740 | 417 832 | 363 096 | 409 332 | 96.7% |
| St.-Roch | Houyet | 1970 | 3 | 300 | 17 573 | 18 200 | 16 373 | 100.0% |
| Total | 1 211 | 130 048 | 16 311 251 | 14 663 770 | 15 598 926 | 95.4% |
1 Not included the buildings being sold and the development projects.
2 Year of construction or latest important renovation.
3 Annual gross rents applicable on 31/12/2011, including rental guarantees and the estimated rental value for unoccupied space.
4 Value estimated by the independent real estate surveyor.
5 Current gross rents on 31/12/2011, on an annual basis. 6 Average for the financial year 2011, including rental guarantees.
5 Because of confidentiality reasons the Sicafi does not publish the individual values per building, as this could damage the interests of the shareholders.
4 The terms used in this table and in the files hereafter are defined in the lexicon at the end of this annual financial report.
On 31 December 2011, the property portfolio of Home Invest Belgium consisted of 80.9% of residential property located in Belgium, a percentage largely superior to the required 60% by the tax legislation to be considered as a residential Sicafi and to benefit from the withholding tax exemption on dividends. This percentage includes nearly 78.5% of apartments and single-family homes, the main investment target group of the Sicafi.
At the same date, the portfolio was located for 69.4% in the Brussels-Capital Region, which reflects the investment strategy of the Sicafi, primarily focused on this region. We need to point out that the renovation of the last two phases of the City Gardens complex in Louvain has allowed to significantly reinforcing the presence of the Sicafi in the Flemish Region to 15.4% whereas the part of the Walloon region in the portfolio slightly decreases to 15.1%.
Brussels
Home Invest Belgium mainly invests in recent (ten years or less) or recently renovated buildings, which represent a total of 59% of the portfolio in comparison with 57.2% the previous year. This choice allows reducing the maintenance and renovation costs during the detention of the property in portfolio, which maximizes the capital gain potential in the long term.
No building nor property complex reaches the maximum 20% ceiling as single part of the portfolio, whereas The Lambermont complex is, since mid 2009, the main part of the property portfolio of Home Invest Belgium, with nearly 11% of the portfolio, followed by the City Gardens complex in Louvain with a stake of slightly more than 7%. The eight main sites only represent 39% of the total portfolio.
The properties below are those having a fair value exceeding € 5 million on 31 December 2011, including the development projects.
Riddersstraat 112-120, Petermannenstraat 2A and 2B and Fonteinstraat 98-
The property complex comprises two wings around an indoor garden; it is located in the immediate surroundings of the city centre of Leuven. The building consists of 108 1-bedroom apartments, 30 2-bedroom apartments, 2 commercial spaces and 92 underground parking spaces.
The property is located at the corner of the avenue du Frioul and the rue de Genève, in a quiet area, looking out in the rear on a new public park. It comprises 85 apartments and 85 underground parking spaces.
Rue de l'Ange 16-20 and rue de la Monnaie 4-14, in 5000 Namur
The complex is ideally located and has a commercial and residential function in the city centre, nearby the Place d'Armes. It consists of a retail ground floor, subdivided into 10 shops, and 50 apartments and studios and 2 office spaces on the floors.
Marcel Thiry and comprises 40 apartments; 37 apartments and 38 parking spaces are owned by Home Invest Belgium.
Avenue de Calabre 34, 36, 38, in 1200 Brussels (Woluwe Saint Lambert)
Rue Joseph II, 82–84, rue Philippe Le Bon, 6-10 and rue Stévin, 19-23, in 1000 Brussels
The property is situated in the Rue de la Grande Haie, in the so-called Cours Saint-Michel, nearby the avenue de Tervueren. It consists of 32 2-bedroom apartments and 32 underground parking spaces.
Rue de la Pépinière 6 to 14 and Rue Thérésienne 5 to 9, in 1000 Brussels
The property complex is located behind the Royal Palace, between the rue de Bréderode and the rue de Namur, close to the Porte de Namur. It comprises 18 luxury apartments, 7 office spaces on the ground floor and 31 underground parking spaces.
The complex is situated in a much sought after area, close to the Etangs d'Ixelles (the Ixelles Ponds), the Abbaye de la Cambre and the Place Flagey (Flagey Square). It consists of 2 apartment buildings, connected by a green area. It comprises 24 apartments, 4 office units and 31 underground parking spaces.
The property is situated close to the Place Werrie (Werrie Square), in a mixed, though mainly residential area. It is part of a mixed residentialshopping complex and consists of 92 apartments or studios, 10 boxes and 20 parking spaces.
Rue des Alliés, 218-226 and boulevard van Haelen, 22-26 in 1190 Brussels (Forest)
The complex is situated in a high-end residential district, nearby the Parc Duden and the Gare du Midi. It comprises 34 apartments, 1 office space and 34 boxes or underground parking spaces.
Rue de l'Orjo, 52-54-56 in 5000 Namur (Jambes)
The complex is situated in a small quiet street in the green periphery of Jambes. It is composed of 33 1-bedroom apartments, 18 2-bedroom apartments and 51 outdoor parking spaces.
Grote Markt Grote Markt 31-32, in 9100 Sint-Niklaas
The property is situated in the 'Grote Markt' of Sint-Niklaas. It consists of a ground floor shopping and office area, 16 upper-floor apartments and 37 outdoor parking spaces.
Rue Hôtel des Monnaies 24 to 34 and rue Jourdan 115 to 121 and 125, in 1060 Brussels (Saint-Gilles)
The property is situated between the rue Jourdan and the rue Hôtel des Monnaies, close to the narrow section of the Avenue Louise leading into the Avenue de la Toison d'Or. It comprises 26 apartments and 15 underground parking spaces.
It consists of 34 apartments, 1 commercial space and 34 underground parking spaces.
< "Clos de la Pépinière" - 1000 Brussels
This corporate governance statement is based on the provisions of the Belgian Corporate Governance Code 2009 ('Code 2009') and on those of the Law of 6 April 2010 on the amendments to the Company Code.
Home Invest Belgium adheres to the principles of the Belgian Corporate Governance Code, edition 2009, without losing out of sight the specific nature of the company. It is Home Invest Belgium's opinion to follow all provisions of the aforementioned Code, except with regard to the following points:
The Royal Decree of 6 June 2010 has indicated the Belgian Corporate Governance Code, edition 2009, as the sole applicable code. The Code is available on the website www.corporategovernancecommittee.be.
The Corporate Governance Charter is established by the Board of directors of Home Invest Belgium and aims at providing complete information on the governance rules applicable to the company. The integral version of the charter can be consulted on the website www.homeinvestbelgium.be.
The present paragraph aims at providing a description of the main characteristics of the internal control systems and risk management of the company within the framework of the publication of financial information.
The Board of directors of Home Invest Belgium and the different specialized Committees are responsible for the evaluation of the risks inherent to the company and for the follow-up of the efficiency of internal control. In its turn, Home Invest Belgium's Executive management is responsible for organizing a risk management system and an efficient internal control environment (see hereafter sub 2.2, 2.3 and 2.4).
The principal elements of the internal control environment consist of:
There is a half-yearly identification and evaluation of the principal risks by the Board of directors, published in the annual and halfyearly financial reports. The risks are also closely followed-up outside the periodical closings at which occasions the Board of directors identifies and evaluates the risks, during its periodical meetings and when evaluating the periodical financial information. This risk analysis results in actions that should limit the exposure to possible identified weaknesses. Fore more details on the risks, see Chapter I. 'Risk factors' of this annual financial report.
• Power of representation: in all cases of an act of disposal with regard to property (as defined in article 2, 20° of the Royal Decree of 7 December 2010 on Sicafi), the company is represented by two directors acting jointly, except with regard to operations on a building of which the value is inferior to the smallest amount between 1% of the company's consolidated assets and € 2.5 million, in which case the company will be legally represented by one director only. In case of exceeding these thresholds, a special power of attorney can be granted to one director providing that the conditions of article 12 of the articles of association of the Sicafi be respected.
• Derogations to the outlook in comparison with the effective realizations, are regularly reviewed by Executive management based on Key Performance Indicators and quarterly by the Audit committee and the Board of directors.
The management information system of the Sicafi allows to obtaining reliable and complete information in a timely manner. Communication is adapted to the size of the company. In essence it is based on daily internal communication between management and staff, meetings and email exchanges.
Saving of IT records is ensured by a continuous back-up system on hard disk and daily on tape.
The Board of directors of Home Invest Belgium currently consists of nine directors. As the mandate of Gaëtan Hannecart will end after the Ordinary general meeting of 2 May 2012, after this date, the Board of directors will be composed of eight directors, of which seven non-executive and one executive, i.e. the managing director. Of the seven non-executive directors, four are independent according to the meaning of article 526 ter of the Company Code.
The Board of director's composition must ensure that decisions are taken in the company's interest. Preference is given to persons possessing an in-depth knowledge of real estate, in particular of residential property, and/or having experience in the financial management of a listed company, in particular, a Sicafi. It is therefore important for the members of the Board of directors to have complementary knowledge and experience.
Commitments have been made to the Sicafi's two largest shareholders, the VOP group and AXA Belgium, with respect to their representation on the Board of directors (two mandates for VOP, one mandate for AXA Belgium). Currently, the directors covered by these commitments are Messrs. Liévin and Johan Van Overstraeten for VOP group and Mr. Guy Van Wymersch-Moons for AXA Belgium.
| Guy Van Wymersch-Moons |
Xavier Mertens |
Guillaume Botermans |
Koen Dejonckheere |
|
|---|---|---|---|---|
| Chairman and Director, Chairman of the Appointment and remuneration committee, member of the Audit committee |
Managing director, Chief Executive Officer, Chairman of the Investment Committee |
Independent director, Chairman of the Audit committee, member of the Investment and Appointment and remuneration committees |
Independent director | |
| Start of first mandate | 6 May 2009 | 17 December 2002 | 2 May 2007 | 3 May 2011 |
| Business address | AXA Belgium SA, Boulevard du Souverain 25, 1170 Brussels |
Home Invest Belgium SA, Boulevard de la Woluwe 60, 1200 Brussels |
Arm-Stones Partnership SPRL, Avenue Louise 505, 1050 Brussels |
GIMV NV, Karel Oomsstraat 37, 2018 Antwerp |
| Other functions | General Manager of Real Estate of AXA Belgium SA |
membre du Conseil de direction de l'UPSI, membre du Comité exécutif de ULI Belgium |
Managing partner of Arm-Stones Partnership SPRL, Director of Pro Materia ASBL |
CEO of GIMV NV |
| Attendance rate at Board meetings during the financial year |
100% | 100% | 100% | 100% |
| Remuneration and benefits in the financial year |
attendance fees of e 5 000 (meetings of the Board of directors) and e 900 (meetings of the Committees) |
see below sub 6. Contractual provisions: see below sub 5. |
attendance fees of e 5 000 (meetings of the Board of directors) and e 3 600 meetings of the Committees) |
attendance fees of e 3 000 (meetings of the Board of directors) |
| Number of Home Invest Belgium shares held |
none | 920 | none | none |
| Expiry date of mandate | Ordinary general meeting of 2015 | Ordinary general meeting of 2015 | Ordinary general meeting of 2016 | Ordinary general meeting of 2015 |
| Education/experience | Degree in law (UCL), Notary degree (UCL), "DES" degree in environmental law (Facultés Universitaires Saint-Louis); he has held a variety of management positions within the AXA Belgium group |
Degree in law (KUL), Master in Business Administration (Lancaster); he has held a variety of management positions, in particular, at Banque Anhyp and at Fortis Real Estate |
Degree, with teaching qualification, in commercial, consular and financial sciences (Jury ICHEC and Saint-Louis Examination Board), degree in European Economics (ULB); he held various management positions within the Paribas group, in particular, in managing real estate certificates |
Civil engineer (Ghent) and MBA (IEFSI, France) |
| Other mandates1 | Blauwe Toren SA, Brustar One SA, Cabesa SA, Cornaline House SA, Evers Freehold SA, Immo Instruction SA, Immo Jean Jacobs SA, Immobilière du Parc Hôtel SA, Immo Zellik SA, Instruction SA La Tourmaline SA, Leasinvest Real Estate SCA, Leg II Meer 15 SA, Leg II Meer 22-23 SA, Leg II Meer 42-48 SA, Lex 65 SA, Marina Building SA, Messancy Réalisation SA, MUCC SA, Parc Louise SA, QB19 SA, Immo RAC Hasselt SA, Royaner SA, Royawyn SA, Sodimco SA, The Bridge Logistics SA, Transga SA, Trèves Freehold SA, Trèves Leasehold SA, Vepar SA, WaterLeau SA, Zaventem Properties SA, Zaventem Properties II SA*, Upar SA, Beran SA, Immo Jean Jacobs SA, WOM, UPSI SA, Leasinvest Immo LUX, Froissart Léopold SA, Parc Léopold SA, Maison de l'Assurance SCRL, Wetinvest III SA, Parc de l'Alliance SA. |
Home Invest Management SA, Belliard 21 SA, UPSI-BVS, ULI Belgium, Emix SPRL. |
Paribacert I, Paribacert II, Paribacert III, Immorente, Artesimmo*, Arm-Stones Partnership SPRL, Pro Materia ASBL, M2 SA. |
Gimv NV, Adviesbeheer Gimv Clean Tech 2007 NV, Adviesbeheer Gimv Buyouts & Growth 2004 NV, Adviesbeheer Gimv Buyouts & Growth 2007 NV, Adviesbeheer Gimv Buyouts & Growth Belgium 2010 NV, Adviesbeheer Gimv Buyouts & Growth 2010 NV, Adviesbeheer Gimv Buyouts & Growth NV, Adviesbeheer Gimv Technology NV, Adviesbeheer Gimv Technology 2004 NV, Adviesbeheer Gimv Technology 2007 NV, Adviesbeheer Gimv Life Sciences NV, Adviesbeheer Gimv Life Sciences 2004 NV, Adviesbeheer Gimv Life Sciences 2007 NV, Gimfin NV, Inframan NV, Vlaamse Investeringsmaatschappij NV, Biotech Fonds Vlaanderen NV, DG Infra + NV, Belgian Venture Capital and Private Equity Association VZW, Gimv-XL NV, Gimv-XL Partners Comm.VA, Adviesbeheer Gimv-XL NV, Adviesbeheer Gimv Venture Capital 2010 NV, Adviesbeheer Gimv Group 2010 NV, Gimv-Agri Investment Fund NV,Adviesbeheer Gimv Deal Services 2004 NV, Adviesbeheer Gimv Deal Services 2007 NV, Adviesbeheer Gimv Fund Deals 2007 NV, Adviesbeheer Gimv Deal Services NV, KBC Securities NV and affiliates*, CapMan PLC ( Finland ), Eagle Venture Partners Guernsey, Gimv Arkiv Tech Fund II NV, Gimv Arkiv Technology Fund, Gimv Nederland BV, Gimv Nederland Holding BV, H.Hartziekenhuis Roeselare Menen VZW, Noorderman NV, Invest At Value NV. |
1 This relates to mandates executed by the directors in other companies in the course of the last 5 years. Expired mandates are indicated by an asterisk.
| Delfosse | Luc | Gaëtan Hannecart |
Eric Spiessens |
Johan Van Overstraeten |
Liévin Van Overstraeten |
|---|---|---|---|---|---|
| Independent director, member of the Appointment and remuneration committee |
Director (till the ordinary general meeting of 2 May 2012) |
Independent director, member of the Audit committee |
Director, member of the Investment committee |
Director, member of the Audit committee |
|
| 19 September 2007 | 1 June 1999 | 3 May 2011 | 18 August 2010 | 23 May 2008 | |
| Delficom, Kapucijnendreef 62, 3090 Overijse |
Matexi Group NV, Franklin Rooseveltlaan 180, 8790 Waregem |
ARCO Group, avenue Urbain Britsiers 5, 1030 Brussels |
VOP SA, avenue du Sippelberg 3, 1080 Brussels |
VOP SA, avenue du Sippelberg 3, 1080 Brussels |
|
| Member of the Board of directors of Wilma Project Development |
Managing director of Matexi Group NV |
Member of the Executive committee of ARCO Group |
Director of VOP SA group | Managing director of VOP SA | |
| 80% | 80% | 83% | 100% | 100% | |
| attendance fees of e 4 000 (meetings of the Board of directors) and e 300 (meetings of the Committees) |
attendance fees of e 4 000 (meetings of the Board of directors) |
attendance fees of e 2 500 (meetings of the Board of directors) and e 300 (meetings of the Committees) |
attendance fees of e 5 000 (meetings of the Board of directors) and e 1 500 meetings of the Committees) |
attendance fees of e 5 000 (meetings of the Board of directors) and e 900 (meetings of the Committees) |
|
| none | none | none | 130 605 | 128 671 | |
| Ordinary general meeting of 2014 | Ordinary general meeting of 2012 | Ordinary general meeting of 2015 | Ordinary general meeting of 2015 The appointment of Mr Johan van Overstraeten as a director representing VOP group has been approved by the Ordinary general meeting of 3 May 2011 |
Ordinary general meeting of 2014 | |
| Degree in Economics and Finance (ICHEC); having held a variety of management positions, at the Codic, CDP, IVG and Wilma groups |
Degree in electronic engineering (KUL), Master in Business Administration (Harvard); having held a variety of management positions in the Matexi group |
Degree in Sociology (KU Leuven), teaching qualification for high school, Engineer in Social Sciences (KU Leuven); having held different functions with responsibility, namely at ARCO group and GIMV |
Jan Van Ruisbroeck college Laeken (1973) with a/o a broad experience in managing companies, more specifically in property development |
Degree in law (KUL 1982) and a "PUB" degree in management (Vlerick 1983), with a/o a broad experience in leading and managing companies, in particular, real estate companies, sports centres and in the wood-processing industry, in Belgium and in Romania |
|
| IVG Real Estate Belgium SA, Property Security Belgium SA, Batipromo SA, Asticus Europe GIE, Opus II SARL Lxbg, Stodiek Beteiligung I Lxbg, Stodiek Beteiligung II Lxbg, Wertkonzept Holland IV Berlin, Wertkonzept Holland V Berlin, Organisation Immobilière SA, ASBL Jazz Station, ASBL FCM Brussels Strombeek*, Régie Communale Autonome de Saint-Josse-ten-Noode, Centre |
Mommens SA, BECI, Promenades Vertes | Matexi Group NV, Matexi NV, Tradiplan NV, Sibomat NV, Entro NV, Wilma Project Development NV, Ankor Invest NV, Brufin NV, Nimmobo NV, Depatri NV, Campagne du Petit Baulers SA, Hooglatem NV, Matexi Luxembourg SA, Nieuw Bilzen NV, Wiprover NV, BI Invest NV, Het Schepenhof NV*, Kempense Bouwwerken NV, La Cointe SA, Renoplan NV, SDM NV, QuaeroQ CVBA, UPSI BVS VZW, NFTE Belgium VZW, Cofinimmo |
Gimv NV, Auxipar NV, VEH CVBA, Publigas CVBA, Aspiravi NV, DG Infra+ NV, EPC CVBA, Sint-Jozefskredietmaatschappij NV, Livingstones CVBA. |
VOP SA, Immovo SA, Sippelberg SA, Rolem Belgium SA, Cocky SA, Stavos Luxembourg SA (G.D. du Luxemburg), Stichting Administratie kantoor Stavos NV (Nederland). |
VOP SA, Immovo SA, Sippelberg SA, Rolem Belgium SA, Cocky SA, Stichting Administra tiekantoor Stavos, Stavos Luxembourg SA, Robelproduct SRL (Roumanie), Robeldoors SRL (Roumanie), Belconstruct SRL (Roumanie), Immorobel SRL (Roumanie), C&C SRL* (Roumanie). |
SA*, SA Simazone, NV Crommelynck, Galerie
SA, Schoonbeek NV*, Itinera Institute, Real Dolmen NV, Matexi Projects NV, Duro Home Holding SA, De Burkel NV, Familo NV, Rode
Moer NV, Vauban NV.
des Carmes SA.
The Board of directors of Home Invest Belgium determines the company's strategy and takes final decisions as regards investments and divestments.
It prepares the half-year and annual accounts of Home Invest Belgium, as well as the Annual financial report, which is drawn up with a view to the General meeting of shareholders, the half-year financial report, as well as the interim statements.
It approves merger reports, decides on the use of authorised capital and convenes Ordinary and Extraordinary general meetings of the shareholders. It ensures the precision, accuracy and transparency of the communications addressed to the shareholders, financial analysts and to the public.
It delegates day-to-day management to Executive management, which reports back to it on a regular basis on its management, and submits to it an annual budget, as well as a quarterly statement.
The Board of directors meets at least seven times a year and whenever required by a specific or a one-time transaction.
It met physically on ten occasions and once by teleconference during the 2011 financial year.
The Board of director's deliberations shall only be valid if at least one-half of the Board's members are present or represented. If this condition is not satisfied, a new meeting can be convened, in which case its deliberations shall be valid on the points contained on the agenda of the previous meeting, provided that at least two directors are present or represented.
There are no specific statutory rules governing the taking of decisions by the Board of directors.
A clear distinction is made between the responsibilities of the Managing director and those of the Chairman of the Board of directors. The latter leads the Board of directors and ensures the drawing up of meeting agendas and the timely transmission of information needed by the directors. For his part, the Managing director is responsible for day-to-day management of the company. Both are in regular contact with respect to business developments. The Board of directors sees to it that the Managing director has sufficient power to assume his obligations and responsibilities.
In the financial year under review, the Board of directors, duly performed all of its duties on a regular basis, as indicated above in item 3.1.2. Namely:
The responsibilities and functioning of these Committees are explained in detail in the Corporate Governance Charter, which can be downloaded on the Sicafi's website (www.homeinvestbelgium.be).
The investment committee, chaired by Mr Xavier Mertens, is comprised of the following people:
Sophie Lambrighs, representative of AXA Belgium group
Johan Van Overstraeten, director, representative of VOP group It is the body that selects, analyses and prepares investment files, although the final approval of these files is entrusted to the Board of directors.
This Committee met on seven occasions during the past financial year.
As this committee is not foreseen by the Belgian Corporate Governance Code, the company has decided not to draw up an activity report for the Investment committee.
Although Home Invest Belgium satisfies two of the three exclusion criteria reproduced in article 526 bis § 3 of the Company Law1 and is therefore not required to set up such a Committee, the Sicafi's Board of directors decided to set up an Audit Committee.
It is chaired by Mr. Guillaume Botermans, Independent director, and is composed of the following people:
It meets at least four times a year and whenever it deems this necessary in order to perform its duties.
It is authorized to decide on the following matters:
1 This is the average number of employees, which is below the threshold of 250 people and the annual net turnover, which is below the threshold of € 50 000 000.
The complete internal rules and regulations of this Audit committee are contained in annex 2 of the Corporate Governance Charter available on the Sicafi's website www.homeinvestbelgium.be.
In the course of the financial year 2011 the committee met four times.
The Auditor of the Sicafi has been consulted each time by the Audit committee in the course of the financial year. Within the framework of his mission to ensure the accuracy of Home Invest Belgium's reporting on annual and half-yearly accounts, and the quality of internal and external control and of the information to shareholders and the market, the following items were discussed:
This committee is chaired by Mr Guy Van Wymersch-Moons, Director and Chairman of the Board, and is composed of the following people:
Home Invest Belgium wanted to combine the remuneration and appointment functions in a single Committee, thus benefiting from the latitude offered by the provisions of the Belgian Corporate Governance Code.
Home Invest Belgium's Appointment and remuneration committee reports to the Board of directors on a regular basis on the performance of its duties. It meets at least twice a year and whenever it deems this necessary for the performance of its duties.
The committee is mainly authorized with regard to:
It meets whenever amendments need to be made to the composition of the Board of directors or the Executive
Overview of the composition of the Board of directors and the Committees:
Michel Pleeck Honorary Chairman
management (appointments, renewals, extensions). More specifically, this committee:
It makes proposals to the Board of directors on the remuneration policy and the individual remuneration of the directors and members of the Executive management.
It prepares the remuneration report, which will be included by the Board of directors in its Corporate Governance statement and comments on this report at the Annual general meeting of the shareholders.
Within the scope of its responsibilities, the Appointment and remuneration committee has access to all of the resources it deems necessary, including to external advice.
The complete internal rules of this Appointment and remuneration committee are shown in annex 4 of the Corporate Governance Charter, available on the Sicafi's website www. homeinvestbelgium.be.
In the course of the financial year 2011 the committee met once, mainly to discuss the following items:
Board of directors Investment committee Audit committee Appointment and remuneration committee Guy Van Wymersch – Moons Chairman - Member Chairman Xavier Mertens Managing director Chairman - - Guillaume Botermans Independent director Member Chairman Member Luc Delfosse Independent director - - Member Gaëtan Hannecart1 Director - - - Johan Van Overstraeten Director Member - - Liévin Van Overstraeten Director - Member - Eric Spiessens Independent director - Member - Koen Dejonckheere Independent director - - - Sophie Lambrighs - Member - -
1 Till the Ordinary general meeting of 2 May 2012.
The Board of directors has not opted for the creation of an Executive committee in the sense of the Company Code. On 31 December 2011 the Executive management consists of Mr Xavier Mertens, CEO, Mr Jean-Luc Colson, CFO (as permanent representative of the sprlu Ylkatt) and Mr Filip Van Wijnendaele, COO, (as permanent representative of the sprlu FVW Consult).
In accordance with article 38 of the Law of 20 July 2004 on certain forms of collective management of investment portfolios, the CEO, the COO and the CFO are charged with day-to-day management of the company and with jointly representing the company within the framework of this management. They report on their management to the Board of directors.
| Xavier Mertens |
Jean-Luc Colson (as permanent representative of sprlu YLKATT) |
Filip Van Wijnendaele (as permanent representative of sprlu FVW Consult) |
|
|---|---|---|---|
| Managing director - Chief Executive Officer |
Chief Finance Officer (permanent representative of sprlu YLKATT) |
Chief Operating Officer (permanent representative of sprlu FVW Consult) |
|
| Start of first mandate | 17 December 2002 | 21 January 2010 | 16 June 2011 |
| Business address | Home Invest Belgium SA, Boulevard de la Woluwe 60, 1200 Brussels |
Home Invest Belgium SA, Boulevard de la Woluwe 60, 1200 Brussels |
Home Invest Belgium SA, Boulevard de la Woluwe 60, 1200 Brussels |
| Education/experience | see above sub point 3.1.1 (Board of directors) |
Degree in accounting (HEMES SAINTE MARIE), having held a variety of financial positions, in particular, at AXA Belgium, ING Real Estate and Home Invest Belgium |
Degree in commercial and consular sciences; held different functions with responsibility, a/o at Hugo Ceusters real estate and the "Vennootschap van commerciële centra van België (SCCB)" |
| Other functions | see above sub point 3.1.1 (Board of directors) |
Director of Home Invest Management SA and Belliard 21 SA |
none |
| Remuneration and benefits | see above sub point 3.1.1 (Board of directors) |
see below sub 6 | see below sub 6 |
| Number of Home Invest Belgium shares held |
see above sub point 3.1.1 (Board of directors) |
none | none |
| Other mandates | see above sub point 3.1.1 (Board of directors) |
sprlu Ylkatt has no directors' mandates. Its permanent representative, Jean-Luc Colson, is director (manager) of the following companies: Home Invest Management NV, Belliard 21 NV, Ylkatt ebvba |
sprlu FVW Consult has no directors' man dates. Its permanent representative, Filip Van Wijnendaele had a mandate as a member of the Executive Committee of NV Immobiliën Hugo Ceusters |
the handling and resolution of disputes concerning rent collection and other subjects directly linked to the management of buildings;
the monitoring of the policy for the maintenance and renovation of buildings
the submission to the Board of directors of an objective and complete quarterly financial report;
the exhaustive, timely, and accurate preparation of the Sicafi's financial results, in accordance with accounting standards;
The Executive Management reports to the Board of directors on its responsibilities and its assignments. It provides on a timely basis, all of the information necessary to the fulfilment of its obligations.
The members of the Executive management are assessed on an annual basis by the Appointment and remuneration committee, as part of the determination of their variable fees, based on the objectives and criteria determined at the beginning of the year (see points 6.4 and 6.5 below).
The complete internal rules of this Executive management appear in annex 3 of the Corporate Governance Charter available on the Sicafi's website www.homeinvestbelgium.be.
Executive management is assisted by a team of eight employees and four freelancers.
Furthermore, Home Invest Belgium appeals to specialised real estate agents to rent out or sell its buildings as effectively as possible. These real estate agents are selected carefully, based on the location of the building, its positioning, and the type of clientele sought.
Moreover, Home Invest Belgium draws on the services of building management companies to assist it in the technical management of its buildings and the breakdown of the shared charges.
Special attention is paid to the reputation for professionalism and integrity of these various service providers, in accordance with the ethical values respected by the Sicafi in the framework of its corporate responsibility.
The remuneration report below has been approved by the Board of directors of 15 February 2012.
It comprises the provisions of the Belgian Corporate Governance Code (edition 2009).
The Appointment and remuneration committee has been formally established beginning of 2010. Questions relating to remuneration policy of non-executive directors and targets of Effective management and the definition of their remuneration have been treated by the Committee in the course of two meetings at the beginning of the financial year 2010.
At the end of 2010 and at the beginning of 2011 the Committee had an important role in selecting a COO candidate to join the Executive management.
In the course of the financial year 2011 the Committee met once at the beginning of the financial year, mainly to treat the evolution of the composition of the Board of directors, and the cooperation with Filip Van Wijnendaele (through the sprlu FVW Consult) as COO, as well as the variable remuneration of Xavier Mertens and Jean-Luc Colson (through the sprlu Ylkatt).
• Relative importance of the different remuneration items: The Board did want to limit these variable remunerations as follows:
for the Managing director: a maximum of 28% of his basis remuneration (see below sub 6.4);
No non-executive director receives any fixed or variable remuneration of any type whatsoever. However, said non-executive directors can submit expense forms for expenses incurred while performing their duties. In 2011, only Michel Pleeck, Chairman of the Board till 3 May 2011, made use of this right, for a total amount of € 11 340.05.
Since the beginning of the financial year 2010 the non-executive directors benefit from a system of attendance fees for the meetings of the Board of directors and the specialized committees, with, € 500 per meeting of the Board and € 300 per meeting of a specialized committee.
Member of Executive management present to these meetings do not benefit from this system.
who is also one of the Sicafi's effective directors (pursuant to an agreement concluded in May 2002, together with an amendment signed on 21 December 2005 and a second amendment, signed on 19 August 2009):
- Financial year 2011
The remuneration of the Managing director on the financial year 2011 amounted to € 301 310.68 (fixed remuneration of € 276 310.68, variable remuneration of € 25 000 granted in 2011 for the financial year 2010).
- Financial year 2012
Taking into account the applicable contractual provisions, the indexed annual basis remuneration, monthly payable, will amount to € 285 243 for 2012, while the variable remuneration can go from 5% to 28% of the annual basis remuneration of the financial year concerned.
The managing director is also eligible for a mobile phone and for reimbursement of his mobile communications expenses, and is reimbursed for up to € 10 000 per year, for the expenses incurred on behalf of the Sicafi (restaurants, travel, etc.).
His variable remuneration is determined on the basis of the application of the five following assessment criteria:
Pension plan, supplementary insurance or other benefits: none Performance bonuses in the form of shares, options or other rights to acquire shares: none
Contractual provisions concerning notice and severance pay:
The agreement concluded with the Managing director provides, in the event of termination by the Sicafi, notice of at least six months, plus a termination compensation of at least 1 month per year of services, without exceeding a total of twelve months. It will be calculated based on both the fixed remuneration and the variable remuneration.
These contractual provisions can possibly diverge2 from the relevant recommendations, as contained in the Belgian Corporate Governance Code (2009 edition). However, the Board of directors believes that these provisions are balanced given the Managing director's level of remuneration and his acquired experience.
6.5 Remuneration of CFO, Mr Jean-Luc Colson (pursuant to an agreement, dated 21 January 2010 with the sprlu Ylkatt):
The agreement provides for an indexed annual base remuneration, payable in monthly instalments, of € 125 000 and a variable remuneration that can vary between 5% and 16% of the basis annual remuneration for the year in question.
He is also eligible for a mobile phone, reimbursement of mobile communications expenses, and is reimbursed for the expenses incurred on behalf of the Sicafi.
- Financial year 2011 The remuneration of CFO, Mr Jean-Luc Colson, on the financial year 2011 amounted to € 143 750 (fixed remuneration of € 128 125, variable remuneration of € 15 625 granted in 2011
His variable remuneration is determined on the basis of the application of the five following assessment criteria, during the year in question:
for the financial year 2010).
• the implementation of the other strategic areas approved by the Board.
Pension plan, supplementary insurance or other benefits: none Performance bonuses in the form of shares, options or other rights to acquire shares: none
Contractual provisions concerning notice and severance pay: The agreement concluded with sprlu YLKATT provides, if the Sicafi terminates the contract, notice of nine months, plus a three-month termination compensation. The notice period can be replaced by a compensation of an amount corresponding proportionally to the remainder of the notice period.
The three-month termination compensation shall be increased by half a month per year of services, but cannot exceed a total of nine months. This compensation shall be calculated based on both the fixed remuneration and the variable remuneration.
These contractual provisions can potentially diverge3 from the relevant recommendations, as contained in the Belgian Corporate Governance Code. However, the Board of directors believes that these provisions are balanced, given the level of remuneration and the acquired experience.
6.6 Remuneration of COO, Mr Filip Van Wijnendaele (pursuant to an agreement, dated 5 March 2011 with the sprlu FVW Consult):
The agreement provides for an indexed annual base remuneration, payable in monthly instalments, of € 144 000 and a variable remuneration that lies between 5% and 16% of the basis annual remuneration for the financial year in question, and payable for the first time during the first two weeks of April 2012.
He is also eligible for a mobile phone, reimbursement of mobile communications expenses, and is reimbursed for the expenses incurred on behalf of the Sicafi.
- Financial year 2011
The remuneration of COO, Mr Filip Van Wijnendaele, on the financial year 2011 amounted to € 78 000 (fixed remuneration of € 66 000 since 14 June 2011 and Sign on Bonus of € 12 000).
His variable remuneration is determined on the basis of the application of the seven following assessment criteria, during the year in question:
Pension plan, supplementary insurance or other benefits: none Performance bonuses in the form of shares, options or other rights to acquire shares: none
Contractual provisions concerning notice and severance pay: The agreement concluded with the sprlu FVW Consult provides, if the Sicafi terminates the contract, three months notice plus one month per service year, totalling a maximum of six months, and a compensation of four months, to augment by one month per year of service, totalling a maximum of six months.
The notice can be replaced by a compensation for an amount proportional to the remaining duration of the notice.
These contractual dispositions are in accordance with the Belgian Corporate Governance Code.
2 If all or part of the notice period is converted into a termination compensation, the maximum 12-month compensation recommended by the Belgian Corporate Governance Code (2009 edition) could be exceeded.
3 If all or part of the notice period is converted into a termination compensation, the maximum 12-month compensation recommended by the Belgian Corporate Governance Code (2009 edition) could be exceeded.
The Statutory auditor of Home Invest Belgium is Mr Karel Nijs, company auditor, related to SCCRL PKF, a firm of corporate auditors, located at Potvlietlaan 6, 2600 Antwerp.
The Statutory Auditor's fees in the course of 2011 amounted to a total of e 49 130.55, including VAT, broken down as follows:
His mandate expires after the Ordinary general meeting of 2013.
SA Winssinger & Associates4 (registered at the Brussels RPM: 0422.118.165), having its registered office at Chaussée de La Hulpe 166, 1170 Brussels, Belgium (tel.: +32 (0)2 629 02 90), represented by Messrs Benoît Forgeur and Fabian Daubechies till the end of 2011, and by Mr Geoffroy Regout as from 2012, is the Sicafi's independent real estate surveyor. It values the property on a quarterly basis, and also in the cases of acquisition, contribution in kind, sale of property, or merger/demerger of real estate companies with the Sicafi, and when buildings are incorporated in the consolidation scope of the company in any other way.
Annual fee: e 0.40 per m² (valuation up to 125 000 m²), e 0.35 per m² (valuation between 125 001 and 175 000 m²), and e 0.30 per additional m².
Laws governing the prevention of conflicts of interest that apply to Home Invest Belgium are contained in articles 523 and 524 of the Company Code, as well as in article 17, 18 and 19 of the Royal Decree of 7 December 2010.
If Home Invest Belgium offers to conclude with a director or with a company linked to the latter a transaction that is not covered by article 523 of the Company Code (for example, because it is a customary transaction concluded under arms length conditions and guarantees), Home Invest Belgium nevertheless deems it necessary for this director to point this out to the other directors prior to the deliberation of the Board of directors and for him to refrain from attending the Board of director's deliberation on this transaction, and to take part in the vote. This rule is reproduced as such in the Corporate Governance charter to which all of the directors have adhered.
In the course of the financial year 2011 one operation has resulted in a conflict of interest in the sense of article 523 of the Company Law and articles 4.7.2 and 4.8 of the Corporate Governance charter; it relates to the partial demerger operation of the company V.O.P. mentioned in point 2 of the aforementioned consolidated Management report (new acquisitions). This potential conflict of interest is elaborated in point 8 of this Management report.
Two directors of Home Invest Belgium, Gaëtan Hannecart and Guy Van Wymersch-Moons, are also directors of other Sicafi, Cofinimmo and Leasinvest Real Estate, respectively. However, given the fact that these two Sicafi invest almost exclusively in real estate market sectors in which Home Invest Belgium does not invest, the likelihood of conflicts of interest are limited.
Executive management is subject to the same rules as regards conflicts of interest as the Board of directors.
The company implements a rigorous policy to avoid conflicts of interest amongst its service providers. Accordingly, the principal service providers are asked to adhere to, and sign their consent for the Corporate Governance Charter, especially with respect to conflicts of interest and the prevention of insider trading (see point 10 below). As regards more specifically the real estate surveyor, the agreement concluded with the Sicafi provides that in the event of a conflict of interest, the initial valuation of the property will be entrusted to a different authorised real estate surveyor.
Given Home Invest Belgium's reputation for integrity, the Board of directors has set up a Code of Conduct applicable to transactions involving the Sicafi's shares and other financial instruments by directors and employees of the Sicafi or its subsidiaries5 .
This code provides a/o:
4 Country of origin: Belgium – Laws governing its activities: Belgian legislation.
5 This Code of Conduct appears in annex 1 of the Corporate Governance Charter available on the website www.homeinvestbelgium.be of the Sicafi.
The compliance officer is Mr Guy Van Wymersch-Moons, Chairman of the Board of directors. For possible transactions the compliance officer would envisage, Xavier Mertens has the role of Compliance Officer.
The structure is elaborated in point 6 of the aforementioned chapter V Home Invest Belgium on the stock exchange.
Set forth below is the information explaining the elements likely to have an effect should a public takeover bid be made for the acquisition of the shares of Home Invest Belgium, in accordance with article 34 of the Royal Decree of 14 November 2007:
7 The rules applicable to the appointment and replacement of Board members and to amendment of the articles of association of Home Invest Belgium are those set forth in the applicable legislation - in particular the Company Code -, the Law of 20 July 2004 relating to certain forms of collective management of investment portfolios, the Royal Decree of 7 December 2010 on Sicafi, and those contained in the articles of association of Home Invest Belgium. The articles of association do not deviate from the above-mentioned provisions imposed by law.
8 In accordance with article 6 of the articles of association, the Board of Directors is authorised to:
It should also be noted that on 31 December 2011, Home Invest Management, a 100% subsidiary of Home Invest Belgium, held 12 912 shares in Home Invest Belgium.
For details on the conditions of the articles of association referred to above, see the articles of association of Home Invest Belgium produced in chapter IX "Permanent document" hereafter.
6 See also the Law of 1 April 2007 on public takeover bids and item 21.2.6 in annex I of the Prospectus regulation 809/2004
7 Of which 12 912 shares in auto-control.
BNP Paribas Fortis (Register of legal persons Brussels: 0403.199.702)8 , having its registered office at Montagne du Parc 3 in 1000 Brussels (tel: +32 (0)2 565 11 11), acts as centralising bank responsible for the financial service of the shares of Home Invest Belgium (payment of dividends, subscription of capital increases, convening to General meetings).
The remuneration is fixed, as regards dematerialized securities, at 0.2% of the net value of the coupon paid. The remuneration for bearer shares is 2% of the net coupon, plus € 0.1 per collected subshare. This remuneration is subject to VAT.
The obligation to have a custodian bank has been deleted by the royal decree of 7 December 2010 and the Sicafi has terminated its contract with Fortis Bank as from 1 July 2011. Upon approval of the new articles of association by the extraordinary general meeting of 23 December 2011, the mention with regard to this appointment has been deleted.
ING Equity Markets acts as liquidity provider of the Home Invest Belgium share. Its annual fixed remuneration is € 5 000, excluding VAT.
8 Country of origin: Belgium – Laws governing its activities: Belgian legislation.
< "Gent Zuid" - Ghent
The 2011 consolidated annual accounts of Home Invest Belgium include those of its subsidiaries, Home Invest Management SA (100%) and Belliard 21 SA (100%) and are presented in € unless mentioned otherwise.
The accounting and valuation criteria set out in the "International Financial Reporting Standards" ("IFRS") have been applied since the annual accounts for the 2006 financial year1 .
We remind that throughout this Annual Financial Report 2011 the figures and percentages realized in 2011 are compared with those of the 2010 financial year; taking into account the new accounting principles applied to the 2011 accounts in virtue of the Royal Decree of 7 December 2010 on Sicafi, the figures of the 2010 financial year have been restated to allow a comparison on the same basis.
| 2011 | 2010 | |
|---|---|---|
| ASSETS | ||
| I. Non-current assets | 257 986 342 | 234 721 489 |
| B. Intangible assets | 7 623 | 8 349 |
| C. Investment properties | 256 558 090 | 233 344 258 |
| D. Other tangible assets | 200 744 | 41 094 |
| E. Non-current financial assets | 37 755 | 46 767 |
| F. Finance lease receivables | 1 182 131 | 1 281 021 |
| II. Current assets | 15 492 597 | 4 825 437 |
| A. Assets held for sale | 7 522 808 | |
| C. Finance lease receivables | 98 890 | 92 752 |
| D. Trade receivables | 4 118 361 | 684 851 |
| E. Tax receivables and other current assets | 1 928 583 | 2 989 647 |
| F. Cash and cash equivalents | 1 701 118 | 1 036 510 |
| G. Deferred charges and accrued income | 122 836 | 21 678 |
| SHAREHOLDERS' EQUITY | ||
|---|---|---|
| A. Capital | 73 469 670 | 70 946 880 |
| B. Share premium account | 19 093 664 | 19 093 664 |
| C. Reserves | ||
| a. Legal reserve (+) | 98 778 | 97 827 |
| b. Reserve from the balance of changes in fair value of investment properties (+/-) | 85 457 148 | 68 696 370 |
| c. Reserve from estimated transfer costs and rights resulting from hypothetical disposal of investment properties (-) |
-23 441 309 | -19 497 399 |
| d. Reserve from the balance of changes in fair value of allowed hedges to which hedge accounting according to IFRS is applied (+/-) |
-2 549 147 | -2 974 112 |
| h. Reserve for treasury shares (-) | -757 323 | -757 323 |
| m. Other reserves (+/-) | 1 259 467 | 1 138 120 |
| n. Result carried forward from previous financial years (+/-) | 7 773 304 | 5 416 341 |
| D. Net result of the financial year | 14 833 588 | 11 807 670 |
| SHAREHOLDERS' EQUITY | 175 237 840 | 153 968 037 |
| LIABILITIES | ||
| I. Non-current liabilities | 64 115 189 | 82 171 517 |
| B. Non-current financial debts | 59 388 750 | 78 433 750 |
| C. Other non-current financial liabilities | 4 726 439 | 3 737 767 |
| II. Current liabilities | 34 125 911 | 3 407 373 |
| B. Current financial debts | 24 926 363 | 465 055 |
| D. Trade debts and other current debts | 8 206 419 | 2 029 317 |
| E. Other current liabilities | 519 171 | 477 347 |
| F. Accrued charges and deferred income | 473 957 | 435 653 |
| LIABILITIES | 98 241 099 | 85 578 890 |
| Debt ratio | 34.02% | 33.98% |
|---|---|---|
| Indebtedness | 93 040 703 | 81 405 470 |
| Net asset value per share | 57.58 | 54.68 |
| Net asset value | 175 237 840 | 153 968 037 |
| Number of shares at end of period | 3 043 231 | 2 815 630 |
TOTAL SHAREHOLDERS' EQUITY AND LIABILITIES 273 478 939 239 546 926
The number of shares at end of period and the average number of shares are excluding the 12 912 shares in auto-control. The average number of shares takes into account the different capital increases in the course of the financial year, of which the detail is recorded in Note 26 of the notes to the financial statements hereafter.
| 31/12/2011 | 31/12/2010 | ||
|---|---|---|---|
| I. | Rental income (+) | 15 724 617 | 14 253 402 |
| III. | Rental-related expenses (+/-) | -188 448 | -137 465 |
| NET RENTAL RESULT (= I +II +III) | 15 536 169 | 14 115 937 | |
| IV. | Recovery of property charges (+) | 83 656 | 106 657 |
| V. | Recovery of charges and taxes normally payable by the tenant on let properties (+) | 400 830 | 370 467 |
| VII. | Charges and taxes normally payable by the tenant on let properties (-) | -1 556 402 | -1 458 373 |
| PROPERTY RESULT (= I +II +III +IV +V +VI +VII +VIII) | 14 464 254 | 13 134 688 | |
| IX. | Technical costs (-) | -923 309 | -1 097 433 |
| X. | Commercial costs (-) | -541 340 | -535 683 |
| XI. | Taxes and charges on unlet properties (-) | -358 203 | -265 738 |
| XII. | Property management costs (-) | -1 739 400 | -1 419 884 |
| Property costs (= IX +X +XI +XII +XIII) | -3 562 253 | -3 318 738 | |
| PROPERTY OPERATING RESULT (I +II +III +IV +V +VI +VII +VIII +IX +X +XI +XII +XIII) | 10 902 000 | 9 815 950 | |
| XIV. | General corporate expenses (-) | -539 388 | -641 319 |
| OPERATING RESULT BEFORE PORTFOLIO RESULT (I +II +III +IV +V +VI +VII +VIII +IX +X +XI +XII +XIII +XIV +XV) |
10 362 613 | 9 174 630 | |
| XVI. | Result sale investment properties (+/-) | 2 096 549 | 1 041 163 |
| XVIII. | Changes in fair value of investment properties (+/-) | 6 449 248 | 3 876 459 |
| OPERATING RESULT (I +II +III +IV +V +VI +VII +VIII +IX +X +XI +XII +XIII +XIV +XV +XVI +XVII +XVIII +XIX) |
18 908 409 | 14 092 253 | |
| XX. | Financial income (+) | 188 741 | 412 723 |
| XXI. | Net interest charges (-) | -2 797 080 | -2 201 999 |
| XXII. | Other financial charges (-) | -34 754 | -127 420 |
| XXIII. | Changes in fair value of financial assets and liabilities | -1 423 915 | -454 930 |
| Financial Result (XX +XXI +XXII +XXIII) | -4 067 008 | -2 371 625 | |
| PRE-TAX RESULT (I +II +III +IV +V +VI +VII +VIII +IX +X +XI +XII +XIII +XIV +XV +XVI +XVII +XVIII +XIX +XX +XXI +XXII +XXIII) |
14 841 402 | 11 720 628 | |
| XXIV. | Corporation tax (-) | -7 814 | 87 042 |
| TAXES (XXIV + XXV) | -7 814 | 87 042 | |
| NET RESULT (I +II +III +IV +V +VI +VII +VIII +IX +X +XI +XII +XIII +XIV +XV +XVI +XVII +XVIII +XIX +XX +XXI +XXII +XXIII +XXIV +XXV) |
14 833 588 | 11 807 670 | |
| NET RESULT PER SHARE | 5.09 | 4.19 | |
| Average number of shares | 2 912 933 | 2 815 630 | |
| NET CURRENT RESULT (excluding the items XVI. XVII. XVIII and XIX.) | 6 287 791 | 6 890 047 | |
| NET CURRENT RESULT PER SHARE (excluding the items XVI. XVII. XVIII and XIX.) | 2.16 | 2.45 | |
| NET CURRENT RESULT EXCLUDING IAS 39 (excluding the items XVI. XVII. XVIII XIX. and XXIII.) | 7 711 706 | 7 344 977 | |
| NET CURRENT RESULT EXCLUDING IAS 39 PER SHARE (excluding the items XVI. XVII. XVIII XIX. and XXIII.) | 2.65 | 2.61 | |
| PORTFOLIO RESULT (XVI. to XIX.) | 8 545 797 | 4 917 622 | |
| PORTFOLIO RESULT PER SHARE (XVI. to XIX.) | 2.93 | 1.75 | |
| DISTRIBUTABLE RESULT | 10 202 475 | 8 509 343 | |
| DISTRIBUTABLE RESULT PER SHARE | 3.50 | 3.02 | |
| Operating margin (Operating result before the portfolio result) / Property result | 71.64% | 69.85% | |
| Operating margin before tax (Pre-tax result – portfolio result) / Property result | 43.53% | 51.79% | |
| Net current margin (Net result – portfolio result) / Property result | 43.47% | 52.46% | |
| Proposed dividend | 3.00 | 2.75 | |
| Pay out ratio | 85.65% | 90.99% |
| 31/12/2011 | 31/12/2010 | |
|---|---|---|
| Statement of comprehensive income | ||
| I. Net result | 14 833 588 | 11 807 670 |
| II. Other items of comprehensive income: | ||
| B. Changes in the efficient part of the fair value of hedging instruments authorized as cash flow as defined in IFRS |
424 965 | -173 731 |
| COMPREHENSIVE INCOME (I + II) | 15 258 553 | 11 633 939 |
| Consolidated | Statutory | |||||
|---|---|---|---|---|---|---|
| 31/12/2011 | 31/12/2010 | 31/12/2011 | 31/12/2010 | |||
| Appropriation and withdrawals | ||||||
| A. Net result | 14 833 588 | 11 807 670 | 15 005 663 | 12 031 955 | ||
| B. Transfer to/from reserves (-/+) | ||||||
| 1. Transfer to/from reserves of the balance (positive or negative) of changes in fair value of investment property |
||||||
| - financial year | -9 279 527 | -8 163 418 | -9 279 527 | -8 163 418 | ||
| - previous financial years | ||||||
| - realization of real estate | 983 127 | 1 398 441 | 983 127 | 1 398 441 | ||
| 2. Transfer to/from reserves of estimated transfer rights and costs resulting from hypothetical disposal of investment properties (+/-) |
2 830 280 | 4 286 958 | 2 830 280 | 4 286 958 | ||
| 11. Transfer to/from result from previous financial years carried forward (-/+) |
-628 667 | -1 586 668 | -762 007 | -1 775 446 | ||
| C. Remuneration of capital according to article 27, § 1, § 1 | -8 161 980 | -6 807 475 | -8 299 640 | -6 986 903 | ||
| D. Remuneration of capital – other than C | -576 821 | -935 508 | -477 896 | -791 587 |
| Consolidated | Statutory | |||
|---|---|---|---|---|
| 31/12/2011 | 31/12/2010 | 31/12/2011 | 31/12/2010 | |
| Scheme for the calculation of the result according to art. 27, § 1, § 1 | ||||
| Corrected result (A) | ||||
| Net result | 14 833 588 | 11 807 670 | 15 005 663 | 12 031 955 |
| + Depreciations |
195 722 | 148 389 | 195 722 | 148 389 |
| - Write-back of depreciations |
-54 501 | -69 477 | -54 501 | -69 477 |
| +/- Other non monetary items | 1 423 915 | 454 930 | 1 423 915 | 454 930 |
| +/- Result on sale of property | -2 096 549 | -1 041 163 | -2 096 549 | -1 041 163 |
| +/- Changes in fair value of property | -6 449 248 | -3 876 459 | -6 449 248 | -3 876 459 |
| Corrected result (A) | 7 852 928 | 7 423 889 | 8 025 003 | 7 648 175 |
| Net capital gains on the sale of property not exempt from distribution (B) | ||||
| +/- Capital gains and losses on property realized during the financial year | 2 349 547 | 1 085 454 | 2 349 547 | 1 085 454 |
| = Net capital gains on the sale of property not exempt from distribution (B) | 2 349 547 | 1 085 454 | 2 349 547 | 1 085 454 |
| Total (A + B) | 10 202 475 | 8 509 343 | 10 374 550 | 8 733 629 |
| 80 % according to article 27, § 1, § 1 | 8 161 980 | 6 807 475 | 8 299 640 | 6 986 903 |
| Capital | Capital increase expenses |
Share premium |
Legal reserve | |
|---|---|---|---|---|
| Balance on 31/12/2009 | 71 639 409 | -692 530 | 19 093 664 | 97 827 |
| Transfer | ||||
| Changes resulting from the sale of a building | ||||
| Dividend distribution | ||||
| Result of the financial year | ||||
| Changes in fair value of hedges | ||||
| Changes in fair value of property | ||||
| Balance on 31/12/2010 |
71 639 409 | -692 530 | 19 093 664 | 97 827 |
| Balance on 31/12/2010 | 71 639 409 | -692 530 | 19 093 664 | 97 827 |
| Transfer | ||||
| Changes resulting from the sale of a building | ||||
| Dividend distribution | ||||
| Partial demerger Masada | 122 709 | -83 596 | ||
| Partial demerger VOP | 2 633 519 | -70 448 | 951 | |
| Mixed demerger URBIS | 5 585 | -84 978 | ||
| Result of the financial year | ||||
| Changes in fair value of hedges | ||||
| Changes in fair value of property |
1 These reserves from the changes in fair value relate to the 3 partial demergers realized in 2011. These values correspond to the difference between the conventional value and the historical accounting value of the incorporated buildings.
| Total | Net result of the financial year |
Result carried forward from previous financial years |
Other reserves | Reserve for treasury shares |
Reserve from the balance of changes in fair value of hedges |
Reserve from estimated transfer costs and rights |
Reserve from the balance of changes in fair value of investment properties |
|---|---|---|---|---|---|---|---|
| 149 050 809 | 8 082 293 | 2 178 316 | 1 138 120 | -757 323 | -2 800 381 | -19 515 291 | 70 586 704 |
| -1 094 938 | 1 839 584 | -744 646 | |||||
| 1 398 441 | 111 065 | -1 509 505 | |||||
| -6 716 711 | -6 716 711 | ||||||
| 11 807 670 | 11 807 670 | ||||||
| -173 731 | -173 731 | ||||||
| -270 644 | -93 173 | 363 817 | |||||
| 153 968 037 | 11 807 670 | 5 416 341 | 1 138 120 | -757 323 | -2 974 112 | -19 497 399 | 68 696 370 |
| 153 968 037 | 11 807 670 | 5 416 341 | 1 138 120 | -757 323 | -2 974 112 | -19 497 399 | 68 696 370 |
| -188 228 | 1 586 668 | -1 398 441 | |||||
| 983 127 | 343 049 | -1 326 176 | |||||
| -7 742 983 | -7 742 983 | ||||||
| 6 055 659 | 1 707 297 | 67 496 | 4 241 7541 |
| 7 383 552 | -1 905 072 | 52 286 | 6 672 3171 | ||||
|---|---|---|---|---|---|---|---|
| 315 022 | -15 058 | 1 567 | 407 9061 | ||||
| 14 833 588 | 14 833 588 | ||||||
| 424 965 | 424 965 | ||||||
| -3 876 459 | -4 286 958 | 8 163 418 | |||||
| 175 237 840 | 14 833 588 | 7 773 304 | 1 259 467 | -757 323 | -2 549 147 | -23 441 309 | 85 457 148 |
| 2011 | 2010 | |
|---|---|---|
| CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | 1 036 510 | 1 964 597 |
| 1. Cash flow from operating activities | 11 333 469 | 5 409 141 |
| Result for the financial year before interest and taxes | 18 908 409 | 15 490 693 |
| Interest received | 188 741 | 412 723 |
| Interest paid | -2 901 852 | -2 329 419 |
| Taxes | -7 814 | 87 042 |
| Adjustment of profit for non-current transactions | -8 519 202 | -6 290 199 |
| Depreciation and write-downs | 26 595 | 25 864 |
| - Depreciation and write-downs on non-current assets | 26 595 | 25 864 |
| Other non-monetary elements | -6 449 248 | -3 876 459 |
| - Changes in fair value of investment properties (+/-) | -6 449 248 | -3 876 459 |
| Gain on realization of assets | -2 096 549 | -2 439 604 |
| - Capital gains realized on the sale of non-current assets | -2 096 549 | -2 439 604 |
| Change in working capital needs | 3 665 186 | -1 961 700 |
| Movements in asset items | -2 380 854 | -254 892 |
| - Current financial assets | -6 138 | -5 806 |
| - Trade receivables | -3 433 510 | 523 012 |
| - Tax receivables and other short-term assets | 1 061 063 | -766 551 |
| - Deferred charges and accrued income | -2 269 | -5 547 |
| Movements of liabilities items | 6 046 040 | -1 706 808 |
| - Trade and other current debts | 5 965 912 | -1 386 490 |
| - Other current liabilities | 41 824 | -282 800 |
| - Accrued charges and deferred income | 38 304 | -37 518 |
| 2. Cash flow from investment activities | -3 173 984 | -1 112 286 |
| Investment properties - capitalized investments | -644 628 | -550 992 |
| Investment properties - new acquisitions | -2 787 200 | |
| Divestments | 7 802 862 | 3 956 293 |
| Development projects | -7 358 234 | -4 502 627 |
| Other tangible assets | -185 519 | -20 256 |
| Other non-current financial assets | -1 266 | 5 296 |
| 3. Cash flow from financing activities | -7 494 876 | -5 224 942 |
| Changes in financial liabilities and debts | ||
| Increase (+) / Decrease (-) in financial debts | 487 129 | 1 497 543 |
| Changes in capital (+/-) | -239 023 | |
| Dividend of the previous financial year | -7 742 983 | -6 722 485 |
| Total cash flow | 1 701 118 | 1 036 510 |
| CASH AND CASH EQUIVALENTS AT END OF PERIOD | 1 701 118 | 1 036 510 |
Reminder: the cash flow statement only shows the cash flow changes during the financial year under review.
Home Invest Belgium SA is a Sicafi (Société d'Investissement à Capital Fixe en Immobilier - Fixed Capital Real Estate Investment Trust). It is constituted in the form of a Belgian société anonyme (public limited liability company). Its registered office is at 1200 Brussels, Boulevard de la Woluwe, 60 (Belgium).
The company is listed on NYSE Euronext Brussels. The consolidated annual accounts encompass those of Home Invest Belgium and its subsidiaries.
The financial statements have been prepared in accordance with the International Financial Reporting Standards (IFRS) as adopted by the European Union.
In accordance with article 2 of the Royal Decree of 21 June 2006 with regard to the bookkeeping, annual accounts and consolidated accounts of real estate Sicafi (fixed capital investment trusts), amending the Royal Decrees of 10 April 1995 and seq. on real estate Sicafi, Home Invest Belgium has made use of the option to draw up its annual accounts in accordance with IFRS standards, starting from the 2006 financial year ending on 31 December 2006.
The company drew up its opening IFRS balance sheet on 1 January 2005 (date of transition to IFRS). In accordance with IFRS 1 - Firsttime adoption of IFRS, the company decided not to reprocess acquisitions made prior to the IFRS transition date, in accordance with IFRS 3 - Business combinations.
The financial statements are presented in euros unless otherwise mentioned. They are prepared on a historical cost basis, with the exception of investment properties and certain financial instruments, which are assessed at their fair value.
The accounting methods have been applied consistently for the financial years presented.
The consolidated annual accounts contain the annual accounts of Home Invest Belgium and its subsidiaries. Subsidiaries are entities controlled by the group. A control is put in place when Home Invest Belgium holds, directly or indirectly, via subsidiaries, more than half the voting rights of a particular entity.
The annual accounts of subsidiaries are fully consolidated from the acquisition date until date at which control ends.
Subsidiaries' accounts are prepared for the same accounting year as that of Home Invest Belgium. Uniform IFRS valuation rules are applied to the subsidiaries in question.
All intra-group operations, as well as unrealized intra-group gains and losses on operations between group companies are eliminated. Unrealized losses are eliminated except in the case of extraordinary capital losses.
Goodwill is the positive difference between the price of the business combination and the group's share in the fair value of the acquired assets, and liabilities of the acquired subsidiary, at the time of takeover. The price of the business combination consists of the acquisition price plus all directly attributable transaction costs.
Negative goodwill (badwill) is the negative difference between the price of the business combination and the group's share in the fair value of the acquired assets, and liabilities of the acquired subsidiary, at the time of takeover. This negative goodwill is immediately passed through the acquirer's income statement.
Intangible assets having a limited life are initially valued at cost. After initial recognition, they are valued at cost less accumulated amortization and any impairment losses.
Intangible assets are amortized on a straight-line basis based on a best estimate of their useful lives.
The useful life and amortization method of intangible assets are reviewed at least at the end of every financial year.
6.1 Investment properties in operation are investments in real estate assets held for long-term rental and/or to increase capital. Investment properties are initially recognised at cost, including transfer rights and non-deductible VAT. Where buildings are acquired through mergers, demergers and contribution of activity segments, the taxes owed on the potential capital gains of the assets integrated in this way are included in the cost of the assets in question.
At the end of the first account period after their initial recognition, investment properties are valued at fair value.
Every quarter an independent external real estate expert values the property portfolio, including costs, registration duty and fees. The expert values properties on the basis of three methods:
In order to determine the fair value of the real estate assets so valued, Home Invest Belgium makes the following adjustments:
• however, where the investment value of these other properties is less than this amount of € 2 500 000, the full amount of registration costs, depending on the applicable regional regulation, will be deducted from the valuation amount.
As long as the investment buildings are new according to the VAT Code, the above restatements are limited to the investment value of the plots of land on which they are built.
Any gain or loss deriving from a change in fair value is recorded in the income statement under the item 'XVIII. Changes in fair value of investment properties' before being allocated to Sharholders' equity under the item 'C. Reserves – b. Reserve of the balance of changes in fair value of investment properties.'.
Building works which are the owner's responsibility are recorded in the accounts in three different ways, depending on the type of work in question:
The buildings where the costs are to be capitalized are identified according to the preceding criteria at the budget preparation stage. The costs that can potentially be capitalized relate to materials, contracting works, technical studies, fees (architects, engineers, project management), internal costs and interest charges during the works.
Property that is being constructed or developed is listed under investment properties at cost till the end of the construction or the development. At that time, the asset is transferred to investment properties in operation. The costs that can potentially be capitalized relate to materials, contracting works, technical studies, fees (architects, engineers, project management), internal costs and interest charges during the construction period.
Other tangible assets are recorded at cost less accumulate depreciation and any impairment losses. Depreciation is recorded on a straight-line basis over the estimated useful life of the asset. The useful life and form of depreciation are reviewed at least at each annual closing.
The useful life is as follows for each asset category:
Financial assets are presented in the balance sheet under current or non-current financial assets depending on the intention or the probability of realization during the twelve months following after the closing date.
A distinction can be made between:
Home Invest Belgium uses financial derivatives to cover its exposure to the risk of interest rate changes in the context of the financing of its activities.
Financial derivatives are initially recorded at cost and then marked to fair value at the following period closing dates.
Changes in the fair value of financial derivatives which do not meet the conditions for hedge accounting according to IAS 39 are passed through the income statement.
The effective portion of the profits or losses from changes in the fair value of financial derivatives which meet the conditions of hedge accounting according to IAS 39, specifically designated and qualified as cash flow hedges of an asset or liability or planned transaction which is recorded in the balance sheet, is accounted for under shareholders' equity. The non-effective part is passed through the income statement. When a hedging instrument expires or is sold, or when a hedge no longer meets the criteria for hedge accounting, any accumulated profit or loss contained at that time in shareholders' equity is passed through the income statement.
An investment property is considered as held for sale if it can be sold immediately in its present state and such a sale is highly likely. An investment property held for sale is valued in the same way as any other investment property.
Trade receivables are stated at their nominal value less estimated non-recoverable amounts. This reduction in value is entered in the income statement.
Cash and cash equivalents consists of cash and current accounts. Cash equivalents are short term and highly liquid investments, which can be easily convertible into a known cash amount, have a maturity of no more than three months, and present no major risk of change in value.
These items are recorded in the balance sheet at nominal value or cost.
Ordinary shares are accounted for in shareholders' equity. Costs directly linked to the issue of new shares or options are recorded in equity, net of tax, as a deduction from the amount collected.
Treasury shares are presented at purchase price and deducted from shareholders' equity. A sale or cancellation of repurchased shares does not affect the income statement; gains and losses on treasury shares are taken directly to shareholders' equity.
Dividends are recognized as liabilities only when approved by the General meeting of shareholders. Any interim dividend is recorded as a liability as soon as the Board of directors has taken the decision to proceed to pay such a dividend.
A provision is recognized in the balance sheet when:
Taxes on the result for the period consist of both current taxes and deferred taxes. These are recognized in the income statement except where they relate to items recorded directly in equity, in which case they too are recognized in equity.
Current taxes are the taxes payable on the taxable income of the past year as well as any adjustment to taxes paid (or recoverable) relating to past years. These taxes are calculated at the tax rate applicable at the closing date.
Deferred taxes are calculated using the liability method on temporary differences between the tax basis of an asset or a liability and its accounting value as stated in the financial statements. These taxes are determined according to the tax rates expected at the time the asset will be realized or the obligation ends.
Deferred tax receivables are recognized for deductible temporary differences and on recoverable tax credits carried forward and tax losses, to the extent that it is probable that taxable profits will exist in the near future with which to use the tax benefit. The accounting value of deferred tax receivables is reviewed at every balance sheet date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to absorb all or part of the deferred taxes.
Deferred tax debts and receivables are defined using the tax rates expected to apply in the years during which these temporary differences will be realized or settled, based on tax rates in effect or confirmed on the balance sheet date.
Exit tax is the tax on the capital gain resulting from the merger of a non-Sicafi company with a Sicafi. When a company without Sicafi status enters into the Group's consolidation scope for the first time, a provision for exit tax is recorded simultaneously as an amount corresponding to the difference between the marked-to-market value of the property and the carrying value of the asset to be acquired in the merger, taking into account the planned merger date.
Rental income from simple rental contracts is recorded as income on a straight-line basis over the life of the rental contract. Rent-free periods and other benefits granted to customers are recorded on a straight-line basis over the first firm rental period.
The gain or loss on the sale of an investment property represents the difference between the sales income, net of transfer rights, and the latest fair value of the sold property on 31 December of the past financial year. That result is presented in item XVI 'Result on sale of investment properties' of the income statement.
In the calculation scheme of article 27, § 1, § 1 of the RD of 7 December 2010, the distributable result comprises the item '+/- Capital gains or losses realized on property during the financial year (capital gains or losses in comparison with the acquisition value increased by capitalized investment expenses)', which thus allows to take into account the initial acquisition value.
Home Invest Belgium has not anticipated the application of the new or amended standards and interpretations issued prior to the date of authorisation of publication of the consolidated financial statements, but which come into effect after the financial period closed on 31 December 2011, namely:
• IFRS 11 Joint arrangements effective as from the financial year starting on 1 January 2013
• IFRS 12 Disclosure of interests in other entities effective as from the financial year starting on 1 January 2013
The future application of these standards and interpretations will have no material impact on the annual accounts.
The investment properties held by Home Invest Belgium contains three categories:
In terms of geographic breakdown, the majority of Home Invest Belgium's investment properties are situated in Brussels, with the Flemish Region representing 15.4% of the portfolio and the Walloon Region 15.1% (calculations based on fair value).
The "unattributed" columns contain the amounts which cannot be attributed to any of these three categories.
| Consolidated total | ||
|---|---|---|
| 2011 | 2010 | |
| I. Rental income (-) |
15 724 617 | 14 253 402 |
| III. Rental-related expenses (+/-) |
-188 448 | -137 465 |
| NET RENTAL INCOME (= I +II +III) | 15 536 169 | 14 115 937 |
| IV. Recovery of property charges (+) |
83 656 | 106 657 |
| V. Recovery of rental charges |
400 830 | 370 467 |
| VII. Recovery of charges and taxes normally payable by the tenant |
-1 556 402 | -1 458 373 |
| PROPERTY RESULT (= I +II +III +IV +V +VI +VII +VIII) | 14 464 254 | 13 134 688 |
| IX. Technical costs (-) |
-923 309 | -1 097 433 |
| X. Commercial costs (-) |
-541 340 | -535 683 |
| XI. Taxes and charges on un-let properties (-) |
-358 203 | -265 738 |
| XII. Property management costs (-) |
-1 739 400 | -1 419 884 |
| PROPERTY COSTS (= IX +X +XI +XII +XIII) |
-3 562 253 | -3 318 738 |
| PROPERTY OPERATING RESULT (I +II +III +IV +V +VI +VII +VIII +IX +X +XI +XII +XIII) | 10 902 000 | 9 815 950 |
| XIV. General corporate expenses (-) |
-539 388 | -641 319 |
| OPERATING RESULT BEFORE PORTFOLIO RESULT (I +II +III +IV +V +VI +VII +VIII +IX +X +XI +XII +XIII +XIV +XV) | 10 362 613 | 9 174 630 |
| XVI. Result on sale of investment properties (+/-) |
2 096 549 | 1 041 163 |
| XVIII. Changes in fair value of investment properties (+/-) |
6 449 248 | 3 876 459 |
| OPERATING RESULT (I +II +III +IV +V +VI +VII +VIII +IX +X +XI +XII +XIII +XIV +XV +XVI +XVII +XVIII +XIX) | 18 908 409 | 14 092 253 |
| XX. Financial income (+) |
188 741 | 412 723 |
| XXI. Net interest charges (-) |
-2 797 080 | -2 201 999 |
| XXII. Other financial charges (-) |
-34 754 | -127 420 |
| XXIII. Changes in fair value of financial assets and liabilites (+/-) |
-1 423 915 | -454 930 |
| FINANC IAL RESULT (XX +XXI +XXII +XXIII) |
-4 067 008 | -2 371 625 |
| PRE-TAX RESULT (I +II +III +IV +V +VI +VII +VIII +IX +X +XI +XII +XIII +XIV +XV +XVI +XVII +XVIII +XIX +XX +XXI +XXII +XXIII) | 14 841 402 | 11 720 628 |
| XXIV. Corporation tax (-) |
-7 814 | 87 042 |
| TAXES (XXIV + XXV) | -7 814 | 87 042 |
| NET RESULT (I +II +III +IV +V +VI +VII +VIII +IX +X +XI +XII +XIII +XIV +XV +XVI +XVII +XVIII +XIX +XX +XXI +XXII +XXIII +XXIV +XXV) | 14 833 588 | 11 807 670 |
| Properties valued by individual units | Properties valued "en bloc" > e 2 500 000 | Properties valued "en bloc" < e 2 500 000 | Unattributed | ||||
|---|---|---|---|---|---|---|---|
| 2011 | 2010 | 2011 | 2010 | 2011 | 2010 | 2011 | 2010 |
| 13 223 611 | 11 731 005 | 2 176 287 | 2 133 246 | 324 720 | 389 152 | ||
| -119 593 | -73 865 | -5 543 | -1 568 | -16 086 | -3 479 | -47 226 | -58 553 |
| 13 104 018 | 11 657 140 | 2 170 744 | 2 131 677 | 308 634 | 385 673 | -47 226 | -58 553 |
| 81 984 | 106 657 | 1 622 | 50 | ||||
| 145 471 | 135 904 | 239 400 | 214 672 | 15 959 | 19 891 | ||
| -1 308 800 | -1 170 451 | -170 021 | -230 116 | -58 041 | -57 717 | -19 539 | -89 |
| 12 022 673 | 10 729 250 | 2 241 744 | 2 116 234 | 266 602 | 347 847 | -66 766 | -58 642 |
| -930 022 | -1 084 074 | -13 198 | -26 295 | -30 459 | 12 936 | 50 369 | |
| -472 244 | -352 152 | -5 248 | -6 409 | -15 636 | -4 809 | -48 213 | -172 313 |
| -140 426 | -261 566 | -2 894 | -2 063 | -483 | -2 109 | -214 402 | |
| -86 027 | -71 374 | -58 017 | -1 653 373 | -1 290 493 | |||
| -1 628 718 | -1 769 166 | -21 339 | -92 783 | -46 577 | 6 018 | -1 865 618 | -1 462 807 |
| 10 393 955 | 8 960 083 | 2 220 405 | 2 023 451 | 220 025 | 353 865 | -1 932 384 | -1 521 449 |
| -539 388 | -641 319 | ||||||
| 10 393 955 | 8 960 083 | 2 220 405 | 2 023 451 | 220 025 | 353 865 | -2 471 772 | -2 162 768 |
| 2 004 185 | 226 227 | 0 | 0 | 117 208 | 814 936 | -24 845 | |
| 5 313 818 | 3 356 631 | 1 084 743 | 676 897 | 50 687 | -157 068 | ||
| 17 711 958 | 12 542 941 | 3 305 147 | 2 700 348 | 387 920 | 1 011 732 | -2 496 617 | -2 162 768 |
| 97 220 | 98 820 | 91 521 | 313 904 | ||||
| -2 797 080 | -2 201 999 | ||||||
| -34 754 | -127 420 | ||||||
| -1 423 915 | -454 930 | ||||||
| 97 220 | 98 820 | -4 164 228 | -2 470 445 | ||||
| 17 711 958 | 12 542 941 | 3 305 147 | 2 700 348 | 485 140 | 1 110 552 | -6 660 844 | -4 633 213 |
| -7 814 | 87 042 87 042 |
||||||
| -7 814 | |||||||
| 17 711 958 | 12 542 941 | 3 305 147 | 2 700 348 | 485 140 | 1 110 552 | -6 668 658 | -4 546 171 |
| Consolidated total | ||
|---|---|---|
| 2011 | 2010 | |
| I. Rental income (+) |
15 724 617 | 14 253 402 |
| III. Rental-related expenses (+/-) |
-188 448 | -137 465 |
| NET RENTAL INCOME (= I +II +III) | 15 536 169 | 14 115 937 |
| IV. Recovery of property charges (+) |
83 656 | 106 657 |
| V. Recovery of rental charges (+) |
400 830 | 370 467 |
| VII. Recovery of charges and taxes normally payable by the tenant (-) |
-1 556 402 | -1 458 373 |
| PROPERTY RESULT (= I +II +III +IV +V +VI +VII +VIII) | 14 464 254 | 13 134 688 |
| IX. Technical costs (-) |
-923 309 | -1 097 433 |
| X. Commercial costs (-) |
-541 340 | -535 683 |
| XI. Taxes and charges on un-let properties (-) |
-358 203 | -265 738 |
| XII. Property management costs (-) |
-1 739 400 | -1 419 884 |
| PROPERTY COSTS (= IX +X +XI +XII +XIII) |
-3 562 253 | -3 318 738 |
| PROPERTY OPERATING RESULT (I +II +III +IV +V +VI +VII +VIII +IX +X +XI +XII +XIII) | 10 902 000 | 9 815 950 |
| XIV. General corporate expenses (-) |
-539 388 | -641 319 |
| OPERATING RESULT BEFORE PORTFOLIO RESULT (I +II +III +IV +V +VI +VII +VIII +IX +X +XI +XII +XIII +XIV +XV) | 10 362 613 | 9 174 630 |
| XVI. Result on sale of investment properties (+/-) |
2 096 549 | 1 041 163 |
| XVIII. Changes in fair value of investment properties (+/-) |
6 449 248 | 3 876 459 |
| OPERATING RESULT (I +II +III +IV +V +VI +VII +VIII +IX +X +XI +XII +XIII +XIV +XV +XVI +XVII +XVIII +XIX) | 18 908 409 | 14 092 253 |
| XX. Financial income (+) |
188 741 | 412 723 |
| XXI. Net interest charges (-) |
-2 797 080 | -2 201 999 |
| XXII. Other financial charges (-) |
-34 754 | -127 420 |
| XXIII. Changes in fair value of financial assets and liabilites (+/-) |
-1 423 915 | -454 930 |
| FINANC IAL RESULT (XX +XXI +XXII +XXIII) |
-4 067 008 | -2 371 625 |
| PRE-TAX RESULT (I +II +III +IV +V +VI +VII +VIII +IX +X +XI +XII +XIII +XIV +XV +XVI +XVII +XVIII +XIX +XX +XXI +XXII +XXIII) | 14 841 402 | 11 720 628 |
| XXIV. Corporation taxs (-) |
-7 814 | 87 042 |
| TAXES (XXIV + XXV) | -7 814 | 87 042 |
| NET RESULT (I +II +III +IV +V +VI +VII +VIII +IX +X +XI +XII +XIII +XIV +XV +XVI +XVII +XVIII +XIX +XX +XXI +XXII +XXIII +XXIV +XXV) | 14 833 588 | 11 807 670 |
| Brussels Region | Flemish Region | Walloon Region | Unattributed | ||||
|---|---|---|---|---|---|---|---|
| 2011 | 2010 | 2011 | 2010 | 2011 | 2010 | 2011 | 2010 |
| 11 441 263 | 10 662 233 | 1 724 882 | 1 239 246 | 2 558 472 | 2 351 923 | ||
| -92 336 | -47 618 | -6 787 | -8 605 | -42 098 | -22 689 | -47 226 | -58 553 |
| 11 348 927 | 10 614 615 | 1 718 095 | 1 230 641 | 2 516 374 | 2 329 234 | -47 226 | -58 553 |
| 76 517 | 65 664 | 1 165 | 33 116 | 5 973 | 7 878 | ||
| 241 526 | 219 676 | 54 295 | 51 481 | 105 008 | 99 310 | ||
| -1 104 916 | -1 030 358 | -151 063 | -159 456 | -280 884 | -268 471 | -19 539 | -89 |
| 10 562 055 | 9 869 598 | 1 622 493 | 1 155 781 | 2 346 471 | 2 167 951 | -66 766 | -58 642 |
| -843 908 | -953 188 | -31 571 | -27 820 | -98 200 | -116 425 | 50 369 | |
| -327 077 | -272 206 | -76 295 | -50 844 | -89 755 | -40 320 | -48 213 | -172 313 |
| -67 166 | -210 237 | -72 462 | -48 009 | -4 174 | -7 492 | -214 402 | |
| -86 027 | -129 391 | -1 653 373 | -1 290 493 | ||||
| -1 324 178 | -1 565 021 | -180 328 | -126 673 | -192 129 | -164 237 | -1 865 618 | -1 462 807 |
| 9 237 877 | 8 304 577 | 1 442 165 | 1 029 108 | 2 154 342 | 2 003 714 | -1 932 384 | -1 521 449 |
| -539 388 | -641 319 | ||||||
| 9 237 877 | 8 304 577 | 1 442 165 | 1 029 108 | 2 154 342 | 2 003 714 | -2 471 772 | -2 162 768 |
| 2 004 897 | 186 646 | 116 722 | 757 869 | -225 | 96 648 | -24 845 | |
| 3 149 249 | 2 629 563 | 2 088 348 | 1 478 528 | 1 211 650 | -231 632 | ||
| 14 392 024 | 11 120 786 | 3 647 235 | 3 265 505 | 3 365 768 | 1 868 730 | -2 496 617 | -2 162 768 |
| 97 220 | 98 820 | 91 521 | 313 904 | ||||
| -2 797 080 | -2 201 999 | ||||||
| -34 754 | -127 420 | ||||||
| -1 423 915 | -454 930 | ||||||
| 97 220 | 98 820 | -4 164 228 | -2 470 445 | ||||
| 14 489 244 | 11 219 606 | 3 647 235 | 3 265 505 | 3 365 768 | 1 868 730 | -6 660 844 | -4 633 213 |
| -7 814 | 87 042 | ||||||
| -7 814 | 87 042 | ||||||
| 14 489 244 | 11 219 606 | 3 647 235 | 3 265 505 | 3 365 768 | 1 868 730 | -6 668 658 | -4 546 171 |
| Consolidated total | |||
|---|---|---|---|
| 2011 | 2010 | ||
| Investment properties in operation | 238 453 170 | 222 773 965 | |
| Investment properties - Development projects | 18 104 920 | 10 570 292 | |
| Assets held for sale | 7 522 808 | ||
| Lease financing receivables | 1 281 021 | 1 373 774 | |
| Other assets | 8 117 020 | 4 828 895 | |
| Total assets | 273 478 939 | 239 546 926 | |
| Percentage by sector | 100% | 100% | |
| Shareholders' equity | 175 237 840 | 153 968 037 | |
| Liabilities | 98 241 099 | 85 578 890 | |
| Total shareholders' equity and liabilities | 273 478 939 | 239 546 926 |
| Consolidated total | |||
|---|---|---|---|
| 2011 | 2010 | ||
| Investment properties | |||
| Investments | 624 064 | 550 992 | |
| Other tangible assets | |||
| Investments | 249 599 | 190 683 | |
| Depreciation | -48 856 | -149 589 | |
| Intangible assets | |||
| Investments | 30 250 | 30 250 | |
| Amortization | -22 627 | -21 901 |
| Consolidated total | ||
|---|---|---|
| 2011 | 2010 | |
| Investment properties in operation | 238 453 170 | 222 773 965 |
| Investment properties - Development projects | 18 104 920 | 10 570 292 |
| Assets held for sale | 7 522 808 | |
| Lease financing receivables | 1 281 021 | 1 373 774 |
| Other assets | 8 117 020 | 4 828 895 |
| Total assets | 273 478 939 | 239 546 926 |
| Percentage by sector | 100% | 100% |
| Shareholders' equity | 175 237 840 | 153 968 037 |
| Liabilities | 98 241 099 | 85 578 890 |
| Total shareholders' equity and liabilities | 273 478 939 | 239 546 926 |
annual financial report 2011 __ financial statements 105
| Properties valued by individual units | Properties valued "en bloc" > e 2 500 000 | Properties valued "en bloc" < e 2 500 000 | Unattributed | ||||
|---|---|---|---|---|---|---|---|
| 2011 | 2010 | 2011 | 2010 | 2011 | 2010 | 2011 | 2010 |
| 204 148 333 | 189 451 709 | 29 948 293 | 28 828 293 | 4 356 544 | 4 493 964 | ||
| 5 845 000 | 4 630 000 | 12 259 920 | 5 940 292 | ||||
| 7 522 808 | |||||||
| 1 281 021 | 1 373 774 | ||||||
| 8 117 020 | 4 828 895 | ||||||
| 217 516 141 | 194 081 709 | 42 208 212 | 34 768 585 | 5 637 566 | 5 867 738 | 8 117 020 | 4 828 895 |
| 79.54% | 81.02% | 15.43% | 14.51% | 2.06% | 2.45% | 2.97% | 2.02% |
| 175 237 840 | 153 968 037 | ||||||
| 98 241 099 | 85 578 890 | ||||||
| 273 478 939 | 239 546 926 |
| Consolidated total | Properties valued by individual units | Properties valued "en bloc" > e 2 500 000 | Properties valued "en bloc" < e 2 500 000 | Corporate | ||||
|---|---|---|---|---|---|---|---|---|
| 2011 2010 |
2011 | 2010 | 2011 | 2010 | 2011 | 2010 | 2011 | 2010 |
| 624 064 550 992 |
579 657 | 550 992 | 40 732 | 3 674 | ||||
| 249 599 190 683 |
249 599 | 190 683 | ||||||
| -48 856 -149 589 |
-48 856 | -149 589 | ||||||
| 30 250 30 250 |
30 250 | 30 250 | ||||||
| -22 627 -21 901 |
-22 627 | -21 901 |
| Brussels Region | Flemish Region | Walloon Region | Unattributed | ||||
|---|---|---|---|---|---|---|---|
| 2011 | 2010 | 2011 | 2010 | 2011 | 2010 | 2011 | 2010 |
| 165 536 616 | 163 524 669 | 36 803 969 | 27 282 749 | 36 112 585 | 31 966 547 | ||
| 18 074 920 | 5 940 292 | 4 600 000 | 30 000 | 30 000 | |||
| 5 505 778 | 1 566 364 | 450 667 | |||||
| 1 281 021 | 1 373 774 | ||||||
| 8 117 020 | 4 828 895 | ||||||
| 190 398 335 | 170 838 735 | 38 370 333 | 31 882 749 | 36 593 252 | 31 996 547 | 8 117 020 | 4 828 895 |
| 69.62% | 71.32% | 14.03% | 13.31% | 13.38% | 13.36% | 2.97% | 2.02% |
| 175 237 840 | 153 968 037 | ||||||
| 98 241 099 | 85 578 890 | ||||||
| 273 478 939 | 239 546 926 |
| 2011 | 2010 | ||
|---|---|---|---|
| I. | Rental income (+) | ||
| A. Rent | 15 679 623 | 14 093 546 | |
| B. Guaranteed revenues | 60 819 | ||
| C. Rent-free periods | -71 420 | -36 606 | |
| E. Early lease termination indemnities | 116 414 | 135 643 | |
| III. | Rental-related expenses (+/-) | ||
| A. Rent payable on leased premises | -47 226 | -58 553 | |
| B. Impairments on trade receivables | -195 722 | -148 389 | |
| C. Reversal of impairments on trade receivables | 54 501 | 69 477 | |
| NET RENTAL RESULT (= I + II + III) | 15 536 169 | 14 115 937 |
The increase of the rental income (+10.3%) is due to the growth of the property portfolio in the course of the financial year 2011. Complete details on these transactions are presented in chapter IV Management report.
| 2011 | 2010 | ||
|---|---|---|---|
| IV. | Recovery of property charges (+) | ||
| A. Indemnities for tenant damage | 83 656 | 106 657 | |
| V. | V. Recovery of charges and taxes normally paid by the tenant on let properties (+) | ||
| A. Re-invoicing of rental-related charges paid by the owner | 41 440 | 49 177 | |
| B. Re-invoicing of property and other taxes on let properties | 359 390 | 321 291 | |
| VII. | Rental-related charges and taxes normally paid by the tenant on let properties (-) | ||
| B. Property and other taxes on leased buildings | -1 556 402 | -1 458 373 | |
| PROPERTY RESULT (= I + II+ III + IV + V + VI + VII + VIII) | 14 464 254 | 13 134 688 |
The recovery of rental-related charges relates mainly to the invoicing of insurance premiums concerning the abandonment of recourse which are contained in most of the fire policies of the buildings, as well as certain expenses related to the supply of telephone lines.
In the residential sector, the property tax is paid by the lessor for all main place of residence leases. Invoicing of property tax and taxes relates therefore mainly to commercial spaces and offices.
| 2011 | 2010 | ||
|---|---|---|---|
| IX. | Technical costs (-) | ||
| A. Recurrent technical costs | |||
| 1. Repairs | -705 734 | -821 110 | |
| 3. Insurance premiums | -94 327 | -82 890 | |
| B. Non-recurrent technical costs | |||
| 1. Major repairs (companies, architects, engineering,) | -138 532 | -193 434 | |
| 3. Indemnification of accidents by insurers | 15 283 |
In its provisional annual budget, Home Invest Belgium defines a specific maintenance and renovation policy for each of its buildings, to keep them in line with the demands of the rental market. Technical costs occur most often upon tenant departures.
| 2011 | 2010 | ||
|---|---|---|---|
| X. | Commercial costs (-) | ||
| A. Agency and experts' fees | -404 319 | -363 369 | |
| B. Lawyers' fees, legal costs | -137 022 | -172 313 |
Home Invest Belgium's policy is to use specialist real estate agents to market the properties in its portfolio to best effect.
| 2011 | 2010 | ||
|---|---|---|---|
| XI. | Taxes and charges on un-let properties (-) | -358 203 | -265 738 |
| XII. | Property management costs (-) | ||
| A. Managers' fees | -85 645 | -71 374 | |
| B. (Internal) property management costs | -1 653 755 | -1 348 510 | |
| Propert y charges (= IX + X + XI + XII + XIII) |
-3 562 253 | -3 318 738 | |
| Propert | y operating res ult (I + II+ III + IV + V + VI + VII + VIII + IX + X + XI + XII + XIII) |
10 902 000 | 9 815 950 |
On 31/12/2011Home Invest Belgium employed 8 people. These costs are accounted for in the internal property management costs.
| 2011 | 2010 | |
|---|---|---|
| XIV. General corporate expenses (-) |
-539 388 | -641 319 |
General corporate expenses mainly relate to cost for publications, the valuation of the portfolio, technical assessments and the subscription tax.
| 2011 | 2010 | ||
|---|---|---|---|
| XVI. | Result on sale of investment properties (+/-) | ||
| A. Net sales of properties (sales price – transfer costs) | 7 802 862 | 3 956 293 | |
| B. Carrying values of the properties sold | -5 706 313 | -2 915 130 | |
| XVIII. | Changes in fair value of investment properties (+/-) | ||
| A. Positive changes in the fair value of investment properties | 9 586 939 | 9 139 134 | |
| B. Negative changes in the fair value of investment properties | -307 412 | -975 716 | |
| C. Positive changes in the estimated transfer costs and rights | 19 585 | 146 755 | |
| D. Negative changes in the estimated transfer costs and rights | -2 849 864 | -4 433 714 |
The result on the sale of investment properties results from the sale of buildings. Complete details on the sales and the realized capital gains are presented in chapter IV Management report.
We remind that the result on the sale of investment properties is accounted for as the difference between the sales price minus the expenses related to the conclusion of these sales (heading XVI.A.) and the latest fair value recorded for the asset in question (heading XVI.B.)
In accordance with article 27 §1 - § 1 of the Royal Decree of 7 December 2010 and annex C, the capital gains realized on property during the financial year are distributable, calculated in comparison with the acquisition value increased by the capitalized investment expenses. On 31/12/2011, the realized distributable capital gain thus amounted to € 2 349 547 (compared to the acquisition value), while the realized capital gain compared to the latest fair value amounted to € 2 096 549.
| 2011 | 2010 | ||
|---|---|---|---|
| XX. | Financial income (+) | ||
| A. Interest and dividends received | 91 521 | 313 904 | |
| B. Lease-financing and similar payments | 97 220 | 98 820 |
Interest and dividends received come exclusively from the short-term deposit of cash surpluses. The Lease-financing payments relate to the leasings described in Note 19.
| 2011 | 2010 | ||
|---|---|---|---|
| XXI. | Net interest charges (-) | ||
| A. Nominal interest on borrowings | -1 385 575 | -693 822 | |
| C. Income from allowed hedges | |||
| 1. Allowed hedges to which hedge accounting as defined by IFRS is applied | -1 411 502 | -1 465 074 | |
| E. Other interest charges | -43 103 |
The charges resulting from hedging instruments relate to the difference between the fixed interest rate paid for the IRS purchased subsequently and the variable interest rates in effect during the course of the financial year. For more detail on the financial debt structure, please refer to Note 24 below as well as to the Risk factors chapter, point 4.
| 2011 | 2010 | ||
|---|---|---|---|
| XXII. | Other financial charges (-) | ||
| A. Bank charges and other fees | -34 754 | -127 420 | |
| XXIII. | Changes in fair value of financial assets and liabilities (+/-) | ||
| A. Allowed hedges | |||
| 1. Allowed hedges to which hedge accounting as defined by IFRS is applied | -1 423 915 | -454 930 |
The changes in fair value of financial assets relate to hedges considered as ineffective according to the application of IAS 39, and are consequently accounted for in the income statement. This purely latent charge is excluded in the calculation of the distributable result.
| 2011 | 2010 | |
|---|---|---|
| XXIV. Income taxes (-) |
-7 814 | 87 042 |
Sicafi enjoy a specific tax system. Only benefits in kind, abnormal and benevolent benefits and certain specific charges are subject to corporate income tax. The subsidiaries are not covered by this specific tax regime.
| 2011 | 2010 | |
|---|---|---|
| Intangible assets, beginning of the financial year | 8 349 | 1 815 |
| 1. Gross value | 30 250 | 22 990 |
| 2. Accumulated amortization (-) | -21 901 | -21 175 |
| Investments | 7 260 | |
| Amortization (-) | -726 | -726 |
| Intangible assets, end of the financial year | 7 623 | 8 349 |
| 1. Gross value | 30 250 | 30 250 |
| 2. Accumulated amortization (-) | -22 627 | -21 901 |
Intangible assets consist solely of the WinIris real estate software. This asset is amortized on a straight-line basis over a 5-year useful life. The amortization is accounted for under heading XII "Property management costs" of the income statement.
| 2011 | 2010 | |
|---|---|---|
| Investment properties, balance at the beginning of the financial year | 233 344 258 | 225 625 958 |
| Development projects | ||
| Investments – development projects | 13 263 818 | 4 502 627 |
| Completion of development projects | -5 729 191 | -12 370 124 |
| Investment properties | ||
| Completion of building under construction | 5 729 191 | 12 370 124 |
| Acquisition of buildings | 16 105 824 | |
| Capitalized subsequent expenses | 624 064 | 550 992 |
| Gains (losses) from fair value adjustments | 6 449 248 | 3 876 459 |
| Other increase (decrease) | -472 654 | |
| Disposals (-) | -5 706 313 | -739 125 |
| Transfer to assets held for sale (-) | -7 522 808 | |
| Investment properties, closing balance at the end of the financial year | 256 558 091 | 233 344 258 |
The development projects are the buildings under construction: the project Odon Warland/Bulins in Jette and the project Belliard/Industrie in Brussels.
The acquisitions of the financial year are described in the Management report.
The Board of directors has selected different buildings for sale within the scope of the arbitrage policy; these are accounted for as assets held for sale.
We remind that the development projects are included among the investment properties in Note 16. The financial year's various acquisitions are set out in chapter IV "Management report".
| 2011 | 2010 | |
|---|---|---|
| Other tangible assets, balance beginning of period | 41 094 | 53 236 |
| 1. Gross value | 190 683 | 177 687 |
| 2. Accumulated depreciation (-) | -149 589 | -124 451 |
| Investments | 185 519 | 12 996 |
| Sales (-) | -126 602 | |
| Depreciation (-) | -25 869 | -25 138 |
| Transfer depreciation (+) | 126 602 | |
| Other tangible assets, closing balance end of period | 200 744 | 41 094 |
| 1. Gross value | 249 599 | 190 683 |
| 2. Accumulated depreciation (-) | -48 856 | -149 589 |
The other tangible assets relate exclusively to the operating assets.
| 2011 | 2010 | |
|---|---|---|
| Receivables after 5 years | 582 639 | 717 882 |
| Receivables after one year and within 5 years | 599 492 | 563 140 |
| Receivables within one year | 98 890 | 92 752 |
| TOTAL | 1 281 021 | 1 373 774 |
The finance lease receivables relate to the Rue de Belgrade building in Forest and Résidence Lemaire in Molenbeek.
| 2011 | 2010 | |
|---|---|---|
| Sales price (excl. costs) | 7 802 862 | 3 956 293 |
| Latest fair value | -5 706 313 | -2 915 130 |
| Realized capital gain | 2 096 549 | 1 041 163 |
| Distributable realized capital gain | 2 349 547 | 1 085 454 |
| 2011 | 2010 | |
|---|---|---|
| Tenants | 520 940 | 524 149 |
| Other | 102 547 | |
| Realized sales | 3 494 874 | 160 702 |
| TOTAL | 4 118 361 | 684 851 |
Trade receivables consist of rental payments still receivable from tenants. These rents are payable in advance. Furthermore, following the signing of different sales agreements at the end of 2011, Home Invest Belgium has on 31/12/2011 receivables of € 3 494 874 that will be paid beginning of 2012, upon enactment of the notarized deeds of sale.
| 2011 | 2010 | |
|---|---|---|
| Recoverable property and other taxes | 710 903 | 1 066 452 |
| Withholding tax on liquidation bonus | 742 763 | |
| Working capital payments | 1 189 089 | 1 180 432 |
| Other | 28 592 | |
| TOTAL | 1 928 583 | 2 989 647 |
Working capital payments are the funds made available to building managers and agents (syndics) to enable them to financially assume the management of the common expenses of the investment properties.
| 2011 | 2010 | |
|---|---|---|
| Cash in hand | 161 | 9 611 |
| Bank balances | 1 700 958 | 1 026 899 |
| TOTAL | 1 701 118 | 1 036 510 |
| 2011 | 2010 | |
|---|---|---|
| Accrued property income | 11 666 | 12 255 |
| Prepaid property charges | 9 423 | 9 423 |
| Other | 101 747 | |
| TOTAL | 122 836 | 21 678 |
| Property income received in advance | 342 633 | 272 014 |
| Interest and other accrued charges | 130 943 | 163 359 |
| Other | 381 | 281 |
| TOTAL | 473 957 | 435 653 |
| 2011 | 2010 | |
|---|---|---|
| Hedging instruments | 55 | 10 333 |
| Other financial assets | 37 700 | 36 434 |
| TOTAL | 37 755 | 46 767 |
The figures in the table below relate solely to debts to financial institutions:
| 2011 | 2010 | |
|---|---|---|
| Current up to one year | 21 715 000 | 102 543 |
| Non-current from 1 to 5 years | 58 690 000 | 77 930 000 |
| Non-current over 5 years | 698 750 | 503 750 |
| TOTAL | 81 103 750 | 78 536 293 |
| Bank | Amount of credit line (e) | Type | Amount drawn (e) | Maturities | |
|---|---|---|---|---|---|
| Variable rate credits | ING | 14 950 000 | Roll-over credit | 14 950 000 | 31/05/2012 |
| ING | 9 400 000 | Roll-over credit | 6 700 000 | 30/09/2012 | |
| ING | 6 540 000 | Roll-over credit | 6 540 000 | 31/05/2013 | |
| ING | 6 000 000 | Roll-over credit | 6 000 000 | 1/08/2013 | |
| BNP | 6 250 000 | Roll-over credit | 6 250 000 | 30/09/2013 | |
| BNP | 6 250 000 | Roll-over credit | 6 250 000 | 30/09/2013 | |
| BNP | 2 000 000 | Roll-over credit | 2 000 000 | 31/01/2014 | |
| DEXIA | 9 400 000 | Roll-over credit | 9 400 000 | 27/11/2014 | |
| DEXIA | 11 350 000 | Roll-over credit | 8 550 000 | 31/12/2014 | |
| ING | 12 000 000 | Roll-over credit | 12 000 000 | 31/12/2014 | |
| BNP | 14 530 000 | Roll-over credit | 1 700 000 | 7/12/2014 | |
| ING | 450 000 | Straight Loan | - | ||
| BNP | 446 208 | Straight Loan | - | ||
| Fixed-rate credits | DEXIA | 763 750 | Investment credit | 763 750 | 30/09/2023 |
| Total | 100 329 958 | 81 103 750 |
| Bank | Amount | Type | Interest rate | Maturity | Fair value |
|---|---|---|---|---|---|
| DEXIA | e 10 000 000 | Floor | 4.85% Knock In 3.85% | 10/07/2013 | -664 694 |
| DEXIA | e 10 000 000 | Cap | 4.85% | 10/07/2013 | 55 |
| DEXIA | e 10 000 000 | Cap | 5.50% Pay out 0.65% | 10/07/2013 | -17 |
| ING | e 20 000 000 | IRS | 4.4195% | 20/12/2013 | -1 357 260 |
| DEXIA | e 11 750 000 | IRS | 2.635% | 30/10/2014 | -527 231 |
| DEXIA | e 15 000 000 | IRS Callable | 2.82% | 17/06/2019 | -1 341 637 |
| ING | e 20 000 000 | IRS | 2.37% | 16/12/2015 | -835 600 |
| Total | e 76 750 000 | -4 726 384 |
It should be noted that the floor and double cap concluded with DEXIA individually amount to € 10 000 000, but that they represent one and the same coverage of € 10 000 000 because, if one is applied, the other two are not activated. The coverage for the company is therefore € 10 000 000 and not € 30 000 000.
The risk management policy is presented in detail above in chapter I "Risk factors".
The above tables show that on 31 December 2011, 94.6% of the capital amounts drawn down were covered by interest rate hedging instruments or covered by a fixed-rate investment credit.
The interest rates applicable to all floating rate borrowings are based on Euribor (drawings of less than 12 months). During the 2011 financial year, 3 and 1-month Euribor rates, were marked by a strong increase in the course of the first semester; consequently they evolved from their minimum at the beginning of January (respectively 0.995% and 0.752%) to reach their maximum at the end of July (respectively 1.615% and 1.470%). This increase was followed by a stabilization in the course of the 3rd quarter to subsequently record a decrease in the course of the last quarter of the financial year. The average over the 2011 financial year was respectively 1.392% for the Euribor 3 months (compared to 0.812% in 2010) and 1.177% for the Euribor 1 month (compared to 0.568% in 2010). In 2009 the rate was 1.225% (Euribor 3 months) and in 2008 4.651% (Euribor 3 months).
Home Invest Belgium's prudent hedging policy enabled it to obtain an average interest rate of 3.40% including margin, over the financial year, compared to 3.28% and 3.39% over the previous financial years.
The interest rate hedges are mainly IRS (Interest Rate Swaps) which serve to exchange floating interest rates for fixed rates. The total amount of this type of hedging amounts to € 66 750 000 at 31 December 2011.
Home Invest Belgium also has a tunnel consisting of a Floor and a Double Cap, for a sum of € 10 000 000.
Given this financial structuring of its debt, combined with its very low debt ratio, Home Invest Belgium has only a limited exposure to fluctuations in market interest rates.
As required by IAS 39, changes in the fair value of hedging instruments are recorded on the closing date, in equity as regards their effective portion, under the heading of the reserves d. Reserve from the balance of changes in fair value of allowed hedges to which hedge accounting according to IFRS is applied (+/-).
The change in the fair value of the ineffective hedging instruments in its turn is recorded at € -1 423 915 in the income statement under heading XXIII. 'Changes in fair value of financial assets and liabilities (+/-)'. It has to be pointed out that this only relates to the annual change that is passed through the results account.
On 31 December 2011, the positive value of hedging instruments is recorded under asset heading I.E. "Non-current financial assets" in a total amount of € 55, while the negative fair value is accounted for in equity under heading I.C. "Other non-current financial liabilities" in a total amount of € 4 726 439.
The credit lines are accounted for under "Non-current and current financial debts". A single credit (Dexia) of € 698 750 is subject to annual repayments, all other credits being "bullet loans" repayable in full at maturity.
| 2011 | 2010 | |
|---|---|---|
| TRADE DEBTS AND OTHER CURRENT DEBTS | ||
| Suppliers | 7 332 277 | 1 122 984 |
| Tenants | 358 551 | 331 531 |
| Tax, salary, social security | 450 169 | 424 491 |
| Exit Tax | 65 423 | 150 312 |
| TOTAL | 8 206 419 | 2 029 317 |
| OTHER CURRENT LIABILITIES | ||
| Dividends | 116 910 | 95 433 |
| Other | 402 262 | 381 915 |
| TOTAL | 519 171 | 477 347 |
Exit tax debts consist of the provisions set up in the context of the merger by absorption of Belliard 21 SA, stil to take place.
Dividends relate solely to earlier dividends not yet claimed by shareholders.
The other current liabilities relate to the provisions for charges paid by tenants.
| Date | Evolution of company capital |
Nature of the operation | Issue price | Number of shares issued / existing |
|---|---|---|---|---|
| 4/07/1980 | 1 250 000 BEF | Constitution of SA Philadelphia | BEF 1 000 | 1 250 |
| 1983 | 6 000 000 BEF | Capital increase | BEF 1 000 | 6 000 |
| 13/04/1999 | - | New representation of capital (by division) | - | 26 115 |
| 1/06/1999 | 1 373 650 000 BEF | Contribution of properties and | - | - |
| 1/06/1999 | 10 931 BEF | Iincrease of capital in cash (rounded) | BEF 1 411.89 | 972 919 |
| 1/06/1999 | 1 500 000 BEF | Merger of SA Socinvest | - | 97 078 |
| 1/06/1999 | -71 632 706 BEF | Capital reduction to discharge debts | - | - |
| Total at 01/06/1999 | e 32 493 343.44 | 1 103 362 | ||
| 09/04/2001 | e 62 000.00 | Merger SA Mons Real Estate | e 32.00 | 35 304 |
| Total at 31/05/2001 | e 32 555 343.44 | 1 138 666 | ||
| 31/05/2002 | e 151 743.90 | Merger of SA Les Résidences du Quartier Européen | e 34.78 | 4 471 |
| Total at 31/05/2002 at 31/05/2003 |
e 32 707 087.34 | 1 143 137 | ||
| 15/12/2003 | e 5 118 338.36 | Contribution of properties by AXA Belgium | e 44.13 | 178 890 |
| 15/12/2003 | e 4 116 712.93 | Contribution of properties by TRANSGA | e 44.13 | 143 882 |
| 15/12/2003 | e 7 861.37 | Incorporation of part of the Share Premium account | - | - |
| Total at 31/05/2004 | e 41 950 000.00 | 1 465 909 | ||
| 12/05/2005 | e 3 472.00 | Merger with SA 205 Rue Belliard | e 51.01 | 3 220 |
| 12/05/2005 | e 4 737.66 | Merger with SA Patroonshuis | e 51.01 | 3 324 |
| Total at 31/12/2005 | e 41 958 209.66 | 1 472 453 | ||
| 22/05/2006 | e 915 214.47 | Merger with SA Immobilière du Prince d'Orange | e 50.32 | 76 000 |
| 5/10/2006 | e 9 978 110.03 | 1st capital increase | e 51.00 | 360 378 |
| 13/10/2006 | e 7 171 221.48 | 2nd capital increase | e 51.00 | 259 002 |
| Total at 31/12/2006 | e 60 022 755.64 | 2 167 833 | ||
| 24/05/2007 | e 275 043.48 | Merger with SA Immobilière Van Volxem | e 57.90 | 5 000 |
| 24/05/2007 | e 3 185.77 | Merger with SA Investim | e 57.90 | 5 824 |
| Total at 31/12/2007 | e 60 300 984.89 | 2 178 657 | ||
| 23/05/2008 | e 10 062 486.49 | Partial demerger of SA VOP | e 50.00 | 622 632 |
| 23/05/2008 | e 29 000.00 | Merger with SA JBS | e 50.00 | 2 088 |
| Total at 31/12/2008 | e 70 392 471.38 | 2 803 377 | ||
| 29/05/2009 | e 1 246 937.97 | Merger with SA Les Erables Invest | e 49.55 | 25 165 |
| Total at 31/12/2009 | e 71 639 409.35 | 2 828 542 | ||
| Total at 31/12/2010 | e 71 639 409.35 | 2 828 542 | ||
| 31/01/2011 | e 122 708.91 | Partial demerger of SA Masada | e 59.72 | 102 792 |
| 23/12/2011 | e 5 584.90 | Mixed demerger of SA Urbis | e 63.32 | 6 318 |
| 23/12/2011 | e 2 633 518.75 | Partial demerger of SA VOP | e 62.91 | 118 491 |
| Total at 31/12/2011 | e 74 401 221.91 | 3 056 143 |
On 31/12/2011, 12 912 shares were held in auto-control by Home Invest Management and these shares were accounted for at € 757 322.67 or € 58.65 per share, or at the same level as their acquisition value.
| Name | Enterprise nr. | Country of origin | Direct or indirect shareholding |
Annual accounts dd. |
|---|---|---|---|---|
| On 31/12/2011 | ||||
| Home Invest Belgium SA | 0420.767.885 | Belgium | - | 31/12/2011 |
| Home Invest Management SA | 0466.151.118 | Belgium | 100% | 31/12/2011 |
| Belliard 21 SA | 0807.568.451 | Belgium | 100% | 31/12/2011 |
| On 31/12/2010 | ||||
| Home Invest Belgium SA | 0420.767.885 | Belgium | - | 31/12/2010 |
| Home Invest Management SA | 0466.151.118 | Belgium | 100% | 31/12/2010 |
| Belliard 21 SA | 0807.568.451 | Belgium | 100% | 31/12/2010 |
All the companies that are part of the consolidation scope are domiciled in Belgium at Bd. de la Woluwe, 60, 1200 Brussels. With the exception of the remuneration of the Managing director (see Corporate Governance statement, 2.) there have been no transactions with related parties within the meaning of IAS 24.
"REPORT OF THE STATUTORY AUDITOR TO THE ANNUAL GENERAL MEETING OF HOME INVEST BELGIUM SA SHAREHOLDERS ON THE CONSOLIDATED ACCOUNTS FOR THE FINANCIAL YEAR ENDING ON 31 DECEMBER 2011
As required by law and the company's articles of association, we are pleased to report to you in the context of the auditor's mandate. The report includes our opinion on the consolidated accounts together with the required additional comment and information.
We have audited the consolidated financial accounts for the financial year ending on 31 December 2011, prepared in accordance with the International Financial Reporting Standards as adopted by the European Union. The consolidated balance sheet shows total assets of € 273 478 939 and the income statement shows a profit for the financial year of € 14 833 588.
The preparation of consolidated financial statements is the responsibility of the management body. This responsibility includes a/o: designing, implementing and maintaining internal control relevant to the preparation and fair presentation of consolidated accounts that are free from material misstatement, whether due to fraud or error, selecting and applying appropriate accounting rules and methods, and making accounting estimates that are reasonable in the circumstances.
Our responsibility is to express an opinion on these consolidated accounts based on our audit. We conducted our audit in accordance with legal requirements and auditing standards applicable in Belgium, as issued by the "Institut des Reviseurs d'Entreprises". Those standards require that we plan and perform the audit to obtain reasonable assurance whether the consolidated accounts are free from material misstatement, whether due to fraud or error.
In accordance with these standards, we have assessed the organisation of the consolidated accounts, taken as a whole, on the basis of the administrative and accounting policies used, as well as the internal audit policies. The board of directors and responsible officers of the company have provided us with the explanations and information necessary for our audit. We have, using samples, examined the justification for the amounts featuring in the consolidated accounts. We have looked into the validity of the rules for evaluation and consolidation, and the reasonableness of significant accounting estimates made by the company and the presentation of the consolidated accounts, taken as a whole. In our opinion, these procedures provide a reasonable base for us to express our opinion.
In our opinion, the consolidated accounts closed on 31 December 2011 give a true image of the financial situation, the financial performance and the cash flow of the consolidated whole, in accordance with the International Financial Reporting Standards as adopted in the European Union.
The preparation and the content of the consolidated management report are the responsibility of the management body.
Our responsibility is to include in our report the following additional comment and information which does not change the scope of our audit opinion on the consolidated accounts:
Antwerp, 28 February 2012
Karel Nijs Statutory Auditor and Auditor certified by the FSMA for UCI's Auditor"
Home Invest Belgium's statutory annual accounts have been prepared in accordance with IFRS standards since 1 January 2005.
The statutory accounts are presented in an abbreviated version, in accordance with article 105 of the Company Code. The detailed statutory accounts will be lodged with National Bank following the Ordinary general meeting. They are also available upon request from the company's registered office.
| 31/12/2011 | 31/12/2010 | |
|---|---|---|
| ASSETS | ||
| I. Non-current assets |
252 072 559 | 234 735 482 |
| B. Intangible assets | 7 623 | 8 349 |
| C. Investment properties | 244 298 170 | 227 403 965 |
| D. Other tangible assets | 200 744 | 41 094 |
| E. Non-current financial assets | 392 180 | 401 052 |
| F. Finance lease receivables | 1 182 131 | 1 281 021 |
| G. Trade receivables and other non-current assets | 5 991 711 | 5 600 000 |
| II. Current assets |
16 436 816 | 5 866 130 |
| A. Assets held for sale | 7 522 808 | |
| C. Finance lease receivables | 98 890 | 92 752 |
| D. Trade receivables | 4 270 783 | 1 005 464 |
| E. Tax receivables and other current assets | 2 922 527 | 3 783 013 |
| F. Cash and cash equivalents | 1 498 972 | 963 222 |
| G. Deferred charges and accrued income | 122 836 | 21 678 |
| TOTAL ASSETS | 268 509 374 | 240 601 612 |
| SHAREHOLDERS' EQUITY | ||
| A. Capital | 73 469 670 | 70 946 880 |
| B. Share premium account | 19 093 664 | 19 093 664 |
| C. Reserves | ||
| a. Legal reserve (+) | 98 778 | 97 827 |
| b. Reserve from the balance of changes in fair value of investment properties (+/-) | 85 319 968 | 68 670 255 |
| c. Reserve from estimated transfer costs and rights resulting from hypothetical disposal of investment properties (-) |
-23 441 309 | -19 608 464 |
| d. Reserve from the balance of changes in fair value of allowed hedges to which hedge accounting according to IFRS is applied (+/-) |
-2 549 147 | -2 974 112 |
| m. Other reserves (+/-) | 1 781 255 | 1 659 908 |
| n. Result carried forward from previous financial years (+/-) | 7 740 810 | 5 195 069 |
| D. Net result of the financial year | 15 005 663 | 12 031 955 |
| SHAREHOLDERS' EQUITY | 176 519 353 | 155 112 982 |
| LIABILITIES | ||
| I. Non-current liabilities |
64 115 189 | 82 171 517 |
| Non-current financial debts | 59 388 750 | 78 433 750 |
| C. Other non-current financial liabilities | 4 726 439 | 3 737 767 |
| II. Current liabilities |
27 874 833 | 3 317 113 |
| B. Current financial debts | 24 926 363 | 465 051 |
| D. Trade debts and other current debts | 1 955 342 | 1 939 062 |
| E. Other current liabilities | 519 171 | 477 347 |
| F. Accrued charges and deferred income | 473 957 | 435 653 |
| LIABILITIES | 91 990 022 | 85 488 630 |
| TOTAL SHAREHOLDERS' EQUITY AND LIABILITIES | 268 509 374 | 240 601 612 |
| Number of shares at end of period | 3 056 143 | 2 828 542 |
| Net asset value | 176 519 353 | 155 112 982 |
| Net asset value per share | 57.76 | 54.84 |
| Indebtedness | 86 789 626 | 79 360 477 |
| Debt ratio | 32.32% | 32.98% |
| 31/12/2011 | 31/12/2010 | |
|---|---|---|
| I. Rental income (+) |
15 724 617 | 14 253 402 |
| III. Rental-related expenses (+/-) |
-188 448 | -137 465 |
| NET RENTAL RESULT (= I +II +III) | 15 536 169 | 14 115 937 |
| IV. Recovery of property charges (+) |
83 656 | 106 657 |
| V. Recovery of charges and taxes normally payable by the tenant on let properties (+) |
400 830 | 370 467 |
| VII. Charges and taxes normally payable by the tenant on let properties (-) |
-1 539 045 | -1 451 360 |
| PROPERTY RESULT (= I +II +III +IV +V +VI +VII +VIII) | 14 481 610 | 13 141 702 |
| IX. Technical costs (-) |
-920 327 | -1 097 184 |
| X. Commercial costs (-) |
-541 340 | -535 683 |
| XI. Taxes and charges on unlet properties (-) |
-358 203 | -265 738 |
| XII. Property management costs (-) |
-1 662 064 | -1 434 906 |
| Property costs (= IX +X +XI +XII +XIII) | -3 481 934 | -3 333 511 |
| PROPERTY OPERATING RESULT (I +II +III +IV +V +VI +VII +VIII +IX +X +XI +XII +XIII) | 10 999 676 | 9 808 191 |
| XIV. General corporate expenses (-) |
-538 859 | -640 485 |
| OPERATING RESULT BEFORE PORTFOLIO RESULT | 10 460 817 | 9 167 706 |
| (I +II +III +IV +V +VI +VII +VIII +IX +X +XI +XII +XIII +XIV +XV) | ||
| XVI. Result sale investment properties (+/-) |
2 096 549 | 1 041 163 |
| XVIII. Changes in fair value of investment properties (+/-) |
6 449 248 | 3 876 459 |
| OPERATING RESULT (I +II +III +IV +V +VI +VII +VIII +IX +X +XI +XII +XIII +XIV +XV +XVI +XVII +XVIII +XIX) |
19 006 614 | 14 085 328 |
| XX. Financial income (+) |
526 347 | 795 234 |
| XXI. Net interest charges (-) |
-3 067 817 | -2 404 650 |
| XXII. Other financial charges (-) |
-27 752 | -76 077 |
| XXIII. Changes in fair value of financial assets and liabilities (+/-) |
-1 423 915 | -454 930 |
| Financial Result (XX +XXI +XXII +XXIII) | -3 993 137 | -2 140 422 |
| PRE-TAX RESULT (I +II +III +IV +V +VI +VII +VIII +IX +X +XI +XII +XIII +XIV +XV +XVI +XVII +XVIII +XIX +XX +XXI +XXII +XXIII) |
15 013 477 | 11 944 906 |
| XXIV. Corporation tax (-) |
-7 814 | 87 050 |
| TAXES (XXIV + XXV) | -7 814 | 87 050 |
| NET RESULT (I +II +III +IV +V +VI +VII +VIII +IX +X +XI +XII +XIII +XIV +XV +XVI +XVII +XVIII +XIX +XX +XXI +XXII +XXIII +XXIV +XXV) |
15 005 663 | 12 031 955 |
| NET RESULT PER SHARE | 5.13 | 4.25 |
| Average number of shares | 2 925 845 | 2 828 542 |
| NET CURRENT RESULT (excluding the items XVI. XVII. XVIII and XIX.) | 6 459 867 | 7 114 333 |
| NET CURRENT RESULT PER SHARE (excluding the items XVI. XVII. XVIII and XIX.) | 2.21 | 2.52 |
| NET CURRENT RESULT EXCLUDING IAS 39 (excluding the items XVI. XVII. XVIII XIX. and XXIII.) | 7 883 782 | 7 569 263 |
| NET CURRENT RESULT EXCLUDING IAS 39 PER SHARE (excluding the items XVI. XVII. XVIII XIX. and XXIII.) | 2.69 | 2.68 |
| PORTFOLIO RESULT (XVI. to XIX.) | 8 545 797 | 4 917 622 |
| PORTFOLIO RESULT PER SHARE (XVI. to XIX.) | 2.92 | 1.74 |
| DISTRIBUTABLE RESULT | 10 374 550 | 8 733 629 |
| DISTRIBUTABLE RESULT PER SHARE | 3.55 | 3.09 |
| Operating margin (Operating result before the portfolio result) / Property result | 72.24% | 69.76% |
| Operating margin before tax (Pre-tax result – portfolio result) / Property result | 44.66% | 53.47% |
| Net current margin (Net result – portfolio result) / Property result | 44.61% | 54.14% |
| Proposed dividend | 3.00 | 2.75 |
| Payout ratio | 84.61% | 89.06% |
9.3. Report of the statutory Auditor on the statutory accounts
The auditor filed a statement without reservations with regard to the statutory annual accounts of Home Invest Belgium.
"City Gardens" - Leuven >
Home Invest Belgium SA, a Belgian "Société d'Investissement à Capital Fixe en Immobilier" (closed-end REIT) or Belgian "Sicaf Immobilière" (Belgian "Sicafi").
The company's registered office is established at B – 1200 Brussels, Boulevard de la Woluwe, 60. Tel: +32 (02) 740 14 50.
A Belgian public limited liability company ("Société anonyme" - SA).
Home Invest Belgium was incorporated on 4 July 1980 under the name of "Philadelphia SA", via a deed executed before notary Daniel Pauporté in Brussels, published in the annex of the Belgian Official Gazette on 12 July 1980 under No. 1435-3. The articles of association were amended on several occasions, most recently, by minutes drawn up by notary Louis-Philippe Marcelis on 23 December 2011, published in the annex of the Belgian Official Gazette on 17 January 2012.
Since 16 June 1999, Home Invest Belgium has been accredited as a Belgian "Société d'Investissement à Capital Fixe en Immobilier de droit belge" and is registered on the list of the FSMA.
The company was incorporated for an unlimited period of time.
Home Invest Belgium is registered at the Registry of Legal Entities ("RPM") under No. 0420.767.885.
The company purpose is reproduced in full, in article 3 of the Coordinated articles of association.
It essentially consists of any collective investment of the public's financial resources in real estate, as defined in article 7,5° of the Law of 20 July 2004 on certain forms of collective management of investment portfolios and article 2, 20° of the RD of 7 December 2010 on Sicafi.
The company can only make any changes to its company purpose or to its investment policy, as reproduced in article 4 of the articles of association, in conformity with its articles of association, more specifically, article 30, which defines the majority and attendance quorum conditions, and provided that said changes are consistent with the laws and regulations applicable to real estate Sicafi.
The company's articles of association can be consulted at the registry of the Brussels commercial court and at the company's registered office.
The annual financial statements are filed at the National Bank of Belgium and can be consulted at the registry of the Brussels commercial court.
They are sent each year, together with the annual financial report, to the holders of registered shares and to those persons who so request.
Decisions concerning appointments and the removal of members of the management bodies of Home Invest Belgium are published in the annex of the Belgian Official Gazette.
Financial press releases concerning Home Invest Belgium are published in financial newspapers and on the company's website. Other publications can be obtained at the registered office of Home Invest Belgium or by consultation of the company's website (www. homeinvestbelgium.be).
The issued and subscribed share capital of Home Invest Belgium on 31 December 2011 stands at € 74 401 221.91.
It is represented by 3 056 143 shares without designation of nominal value. This capital is fully paid-up.
With respect to accounting, the IFRS standards provide that expenses incurred to increase the capital are deducted from the subscribed capital.
Consequently, according to the financial statements drawn up in accordance with IFRS the capital stood at € 73 469 670.05 on 31 December 2011.
The Sicafi's Board of Directors is authorised to increase, on one or more occasions, the share capital and to issue convertible bonds or subscription rights. These capital increases can be made by subscriptions in cash, contributions in kind, or via the incorporation of reserves or issue premiums.
This authorisation for a maximum amount of € 74 401 221.91 has been granted for a term of five years that began on 17 January 2012, the date of the publication in the Annexes to the Belgian Official Gazette of the minutes of the Extraordinary general meeting of 23 December 2011.
On 31 December 2011, the balance of the authorised capital was still € 74 401 221.91.
3 Co-ordinatedarticlesof association (on 23 December 2011)
SECTION I – FORM – NAME – REGISTERED OFFICE – PURPOSE – DISTRIBUTION OF INVESTMENTS – DURATION
The company takes the form of a public limited liability company (société anonyme) under Belgian law, in order to invest in the real estate category, as set out in article 7, 1st paragraph, 5° of the Law of 20 July 2004 with regard to certain forms of collective management of investment portfolios.
The company is a public undertaking for collective investment with a fixed number of participation rights and is subject to the legal status of companies with fixed capital, named "public Sicafi
incorporated under Belgian law", foreseen by article 19 of the Law of 20 July 2004 and the relevant implementing orders. It carries the name "HOME INVEST BELGIUM". This name is followed immediately by, and all documents emanating from the company include the words: "Société d'Investissement Immobilière publique à Capital Fixe de droit belge" (Public Fixed Capital Real Estate Investment Company under Belgian Law) or "Sicaf Immobilière publique de droit belge" (Public Real Estate Sicaf under Belgian Law).
The company makes calls for public savings within the meaning of Article 438 of the Company Law.
The company is subject to the relevant provisions of the Law of 20 July 2004 with regard to certain forms of collective management of investment portfolios and of the Royal Decree of 7 December 2010 on Sicafi, and of all other Royal Decrees in pursuance of the aforementioned Law that are applicable to undertakings for collective investment with a fixed number of participation rights, having as their exclusive object, the collective investment in the category of allowed investments as defined in article 7, 1st paragraph, 5° of the aforementioned Law. The aforementioned Law of 20 July 2004, the Royal Decree of 7 December 2010 with regard to Sicafi, together with all other applicable Royal Decrees and any other regulation applicable at anytime to Sicafi, are collectively referred to hereafter as the "Legislation applicable to Sicafi".
The company's registered office is established at Woluwe-St. Lambert (B-1200 Brussels), Bd de la Woluwe 60/4.
It may be transferred to any other place in Belgium by decision of the board of directors. Hereto, the board of directors is also authorized to have the consequent amendments to the articles of association authenticated.
I. The main purpose of the company is the collective investment of financial resources obtained from the public in real estate as defined in article 7, 1st paragraph, 5° of the Law of 20 July 2004 and article 2, 20° of the Royal Decree of 7 December 2010. Real estate is defined as:
vi. participation rights in undertakings for collective investment in real estate established in an other member state of the European Economic Area, and not registered with the list foreseen in article 129 of the law, as far as they are subject to a similar supervision as the public Sicafi;
vii. real estate certificates, as foreseen in article 5, § 4, of the Law of 16 June 2006;
Within the limits of the investment policy as described in article 4 of the articles of association and in accordance with the legislation applicable to Sicafi, the company may, directly, or through a subsidiary:
II. The company may also, in accordance with the legislation applicable to Sicafi:
The company may acquire, lease in or out, transfer or exchange and, in general, undertake all commercial or financial activities relating to all movable and immovable assets, which relate directly or indirectly to its company purpose, as well as exploit any intellectual rights relating to these assets and activities.
In so far as is compatible with the status of Sicafi, the company may, by means of contributions in cash or in kind, merger, registration, participation, financial intervention or in any other way, acquire shares in companies or enterprises of any kind, existing or to be constituted, in Belgium or abroad, the company purpose of which is identical to its own, or which is such as to promote the achievement of its own company purpose.
4.1. The assets of the company and its potential subsidiaries are invested in property as defined by article 3 of the articles of association.
Collective investments in property are made,
Investments in securities, not in accordance with the aforementioned definition of real estate, are valued and executed in accordance with article 35 § 1 of the Royal Decree of 7 December 2010, in accordance with the articles 47 and 51 of the Royal Decree of 4 March 2005 with regard to certain public undertakings for collective investment.
4.2. Prohibitive rules:
As for the field of application of the previous paragraph, amounts due to the company following any property transfer, as far as they were paid for during the period of usage, are not taken into account.
bankrupt, that has concluded a private agreement with its creditors, that has been subject to a procedure of legal reorganization, that has been granted delayed payments, or has been subject to a comparable measure abroad.
iv. The company cannot grant mortgages, nor grant other sureties or guarantees, other than those within the framework of financing its real estate activities or those of its group.
The total coverage amount of these mortgages, sureties or guarantees can never exceed 50% of the correct value of the property held by the company and its subsidiaries. No single mortgage, surety or guarantee on a specific property, granted by the company or one of its subsidiaries, can relate to an amount exceeding 75% of the value of the entailed property.
The company is established for an unlimited period of time.
CAPITAL
Article 6
The subscribed company capital is set at the sum of € 74,401,221.91 and is represented by 3,056,143 no-par shares, numbered from 1 to 3,056,143, each representing an equivalent fraction of the capital.
The board of directors is expressly authorized to increase the capital of the company, in one or more instalments, up to a maximum of € 74,401,221.91 at dates and according to arrangements to be set by itself, pursuant to article 603 of the Company Law.
Under the same conditions the board of directors is authorized to issue convertible bonds or subscription rights.
This authorization is granted for a period of five years from the date of publication in the Annexes to the Official Belgian Gazette of the minutes of the extraordinary general meeting of 23 December 2011. Whenever capital is increased, the board of directors will set the price, any issue premium and the issue conditions of the new shares, unless the general meeting decides otherwise.
The preferential right of the shareholders can either be limited or lifted in accordance with article 6.4 of the articles of association.
The capital increases decided in this way by the board of directors may be undertaken by subscription in cash or by contributions in kind or by incorporation of reserves or issue premiums, with or without the creation of new shares, or following the distribution of an optional dividend, in each case with due respect for the legal provisions, such increases being able to lead to the issue of voting or non-voting shares.
Such capital increases may also take the form of the conversion of convertible bonds or the exercise of subscription rights – attached or not to another security – which can lead to the creation of voting or non-voting shares.
Where the capital increases decided by virtue of this authorization include an issue premium, the amount of such premium, after imputation of any expenses, will be placed in an unavailable account named "issued premium". This will constitute, in the same way as capital, the guarantee towards third parties and may be reduced or abolished only a decision of the general meeting under the conditions for quorum and majority as required for a capital reduction, except if incorporated into capital.
The company may acquire its own shares by purchase or take them in pledge under the conditions provided for by law.
By decision of the extraordinary general meeting of 23 December 2011, the board of directors is authorized to acquire shares of the company on behalf of Home Invest Belgium, at a price per share equal to at least 80% of the most recent Net Asset Value published prior to the transaction date, and to no more than 105% of said Value, for a period of 5 years from the date of the publication in the annexes to the Official Belgian Gazette of the minutes of the extraordinary general meeting of 23 December 2011, on the understanding that the company may not at any time hold more than 10% of all issued shares.
The company is also authorized, with no requirement for any additional prior approval of the general meeting, to acquire by purchase the shares of the company, should such acquisition be necessary to avoid serious and imminent damage to the company. This authorization is granted for a period of three years from the date of publication in the annexes to the Official Belgian Gazette of the minutes of the general meeting of 23 December 2011, and may be extended for equal periods.
It is authorized to dispose of the shares acquired by the company, on or off the stock exchange, at conditions set by the board of directors, without prior authorization of the general meeting.
The above authorizations extend to acquisitions and disposals of shares in the company by one or more of its direct subsidiaries, within the meaning of the legal provisions relating to the acquisition by subsidiaries of the shares of their parent companies.
Without prejudice to the articles 592 till 598 of the Company Law, the company's capital may be increased by a decision of the general meeting, or by a decision of the board of directors, within the framework of the authorized capital, taking into account that the rights of preference shareholders can only be limited or lifted as far as an irreducible allocation right is given to the current shareholders when granting new securities. This irreducible allocation right meets the following conditions:
Without prejudice to the articles 595 till 599 of the Company Law, the aforementioned irreducible allocation right has not to be granted in the case of a contribution in cash with limitation or lifting of the preferential right, as an accessory of a contribution in kind within the framework of the distribution of an optional dividend, as far as the distribution of this dividend is effective to all shareholders.
The company may not, directly or indirectly subscribe to its own capital.
The general meeting can decide to issue shares without mentioning the par value below the fractional value of the old shares. The convocation to the general meeting should explicitly mention this. With reference to this, in application of article 582 of the Company Law, special reports have to be issued by the board of directors and the auditor, that should also be mentioned in the convocation.
In the case of a capital increase with the creation of issue premiums, the total amount of this premium has to be fully paid up at the subscription. After deduction of potential charges, this amount will be transferred to a blocked account, called "issue premium", that will, as it is the case for capital, constitute a third party warranty and can only be reduced or lifted by a decision of the general meeting respecting the quorum and majority conditions required for a capital decrease, subject to its incorporation in capital.
The issue of shares against a contribution in kind has to meet the conditions of the articles 601 and 602 of the Company Law. 6.5.1. Furthermore, the following conditions have to be respected according to the Legislation on Sicafi:
prior to the date of the capital increase deed, and (b) the average closing price during thirty calendar days prior to that same date. If necessary, it can be decided to deduct from the aforementioned amount under (b), an amount that corresponds to the part of the undistributed gross dividend the new shares are potentially not entitled to, providing that the board of directors specifically motivates the amount to be deducted from the accumulated dividend in its special report, and explains the financial conditions of the operation in its annual financial report;
3° Except if the issue price, or in the case of the situation foreseen in article 6.5.3, the exchange rate, as well as the applicable modalities are, at latest on the working day following the conclusion of the contribution agreement, are defined and communicated to the public, mentioning the period during which the capital increase will effectively take place, the capital increase deed will be recorded within a maximum term of four months;
4° The report mentioned in 1° should also mention the impact of the proposed contribution on the situation of existing shareholders, more specifically with regard to their share in the profit, in the net asset value and in the capital, as well as the impact with regard to voting rights;
6.5.2. The conditions of art. 6.5.1 do not apply in the case of a contribution of the right to a dividend within the framework of the distribution of an optional dividend, as far as this is effectively payable to all shareholders.
6.5.3. Article 6.5.1 of these articles of association applies mutatis mutandis to the mergers, demergers and similar operations mentioned in the articles 671 till 677, 681 till 758 and 772/1 of the Company Law. In that case the "date of the contribution agreement" refers to the filing date of the merger or demerger proposal.
In the case of a capital increase of a subsidiary having the status of a listed institutional Sicafi, through a contribution in cash for a price of 10% or more below the lowest value of (a) a net asset value of at the very most four months prior to the start of the issue, or (b) the average closing price during thirty calendar days prior to the start date of the issue, the board of directors establishes a special report; in this report he elaborates on the economic justification of the applied discount, the financial consequences of the operation for the shareholders and the importance of the capital increase for the company. This report, and the valuation rules and methods, are explained by the auditor in a separate report.
For the calculation of the contribution price it is allowed to deduct an amount from the amount mentioned in point (b) of the aforementioned paragraph, that corresponds to the part of the undistributed gross dividend to which the new shares are potentially not entitled, providing that the board of directors specifically motivates the amount to be deducted from the accumulated dividend and explains the financial conditions of the operation in the annual financial report.
In the case of a capital increase of a subsidiary having the status of an unlisted institutional Sicafi, the discount mentioned in subparagraph 1, is only calculated based on a net asset value of at latest four months; all other obligations apply.
This article does not apply to capital increases fully subscribed by the company or its subsidiaries, whose capital is, directly or indirectly, entirely held by the company.
The shares are registered shares, bearer shares or dematerialized shares. They are all fully paid up and without nominal value.
The company could issue dematerialized shares by capital increase or by exchange of existing bearer or registered shares. Each shareholder can, at his costs, ask for an exchange into registered or dematerialized shares.
In accordance with the Law of 14 December 2005 annulling bearer shares:
In accordance with article 8, § 2, 4° of the Law of 20 July 2004 on certain forms of collective management of investment portfolios, different categories of shares can be created; such a decision will lead to an amendment to these articles of association.
The registered shares are listed in the shareholders' register held at the registered office of the company. Ownership of these shares is exclusively proven by registration to the shareholders' register. Each transfer of these shares can only have an effect after registration of the transfer of these shares in the shareholders' register, dated and signed by the seller and buyer or their proxies, or after having fulfilled the formalities required by law for the transfer of these receivables. Registered registration certificates are delivered to the shareholders.
The shares are indivisible and the company only recognizes one owner per security. If different persons have rights with regard to the same share, the execution of the related rights will be suspended until one single person is indicated as the owner of the security with regard to the company.
At the exception of van profit-sharing bonds and similar securities, and subject to specific related legal provisions, the company can issue other securities in accordance with article 460 of the Company Law.
Pursuant to the provisions of the law of 2 May 2007 on the publication of important participations in issuers of shares admitted to trading on the stock exchange, any legal or physical person acquiring shares or other financial instruments giving entitlement to a vote, whether or not these represent capital, is required to communicate to the company and to the Banking, Finance and Insurance Commission the number of financial instruments held by it, every time that the voting rights attached to these financial instruments reach either 3% or 5% or a multiple of 5% of the total number of voting rights existing at such time or at the time that circumstances making such communication mandatory present themselves.
This declaration is also mandatory in the event of disposal of securities when, as a result of this disposal, the number of voting rights falls below the thresholds referred to in sub-paragraphs one and two."
The company is governed by a Board, composed to the effect of ensuring an autonomous management, in the exclusive interest of the shareholders; it consists of at least 3 and no more than 9 directors, who may or may not be shareholders, and who are appointed for a term of, in principle, four years, by the general shareholders' meeting; the duration of the mandate may never exceed six years; the mandate is revocable at any given moment.
Among the members of the Board of directors the general meeting must appoint at least 3 independent directors. An independent director is defined as one meeting the criteria set out in article 526 ter of the Company Law.
In the event that one or more directorships become vacant, the remaining directors are entitled to fill the vacancy until the next general meeting which will proceed to the definitive appointment. This right becomes an obligation whenever the number of directors effectively in function no longer reaches the statutory minimum.
In the event that a legal person is appointed as director, this person is required to designate a physical person who will represent it in the exercise of its directorship.
All directors and their representatives must possess the professional competence and experience required for this function and are answerable for the autonomous management of the company.
The board of directors may appoint a chairman from among its members.
Pursuant to article 524bis of the Company Law and without prejudice to the indications given below with regard to day-to-day management and delegation, the board of directors may delegate its management powers to an executive committee (comité de direction) consisting of several members, who may or may not be directors. The delegation may not include defining the general policy of the company or the various deeds reserved by law or the articles of association for the board of directors or decisions or operations to which article 524ter of the Company Law applies, in which case the procedure of informing the board of directors provided for by article 524ter paragraph 2, will be followed.
The board of directors is charged with supervising the executive committee, and sets its modus operandi, the conditions for the appointment of its members, their dismissal, their compensation and the length of their missions.
Whenever a legal person is appointed a member of the executive committee, that person is required to designate a permanent representative from among its partners, owner-managers, directors or workers, charged with undertaking this mission on behalf of and for the account of this legal person.
The board may delegate the day-to-day management of the company, the management of one or more sectors of activity or the execution of the decisions of the board to one of more directors, executive managers or mandated agents.
The day-to-day management is organized in such a way that, within the board of directors, it is exercised or controlled either by two directors acting jointly, or by a managing director acting singly, appointed by the board of directors.
Both the board and the persons to whom day-to-day management has been mandated in the framework of such management may also confer specific powers on one or more persons of their choice. The board may set the compensation of each mandated agent to whom special powers have been granted, pursuant to the Law of 20 July 2004 on certain forms of collective management of investment portfolios and its implementing orders.
The board of directors is authorized to undertake all action necessary or useful for achieving the company purpose and to undertake everything that is not reserved for the general meeting by law or these articles of association. The company is managed in the exclusive interests of the shareholders.
The board of directors prepares the half-yearly report and the draft annual report.
The board of directors appoints the expert(s) in accordance with article 6 of the Royal Decree of 7 December 2010 on Sicafi, and will propose any change to the list, as imposed by the Legislation on Sicafi.
The board of directors appoints the financial institution in charge of the company's financial service and revokes its mission, if necessary, in which case, it sees to it that the financial service remains ensured. The coordinates of the financial institution are communicated in the annual report.
The company is validly represented in deeds and in law, including deeds requiring the intervention of a public official or a notary public, either by two directors acting jointly or, in the context of dayto-day management, by a person mandated to such management, or, where an executive committee exists, and within the limits of the powers conferred on such executive committee, by two members of the same acting jointly.
For all deeds of disposition involving an item of real estate, two directors must always act jointly pursuant to article 9 § 2 of the Royal Decree of 7 December 2010 on Sicafi, except when the operation relates to a building whose value amounts to less than the lowest amount of 1% of the consolidated company assets and € 2.500.000, in which case the company will be validly represented by one single director. In the case the aforementioned values are exceeded, special powers can also be granted to one director; such a power delegation has to take place under the direct supervision, during and after the operation, of the board of directors, and taking into account the fulfilment of the following cumulative conditions:
The company is also validly bound by two special mandated agents acting within the framework of their mission.
The company may be represented abroad by any person expressly appointed by the board of directors.
Copies or extracts of the minutes of the general meetings of shareholders and of meetings of the board of directors, including extracts intended for publication in the annexes to the Belgian Official Gazette, are validly signed either by one director, or by a person charged with day-today management or who has been expressly mandated by the board of directors.
Meetings of the board of directors are convened by its chairman, two directors or the managing director at least three days before the planned meeting date.
The convening notice may be validly sent by post, airmail, telegram, telex or fax. The convening of meetings by telephone is also valid. Any director attending a board meeting or represented at the same is deemed to have been regularly invited to the meeting. A director may also renounce invoking the absence or irregularity of a convening notice, either before or after the meeting not attended by him.
Board meetings are held in Belgium or abroad, at the place indicated in the convening notice.
Where the board of directors has appointed a chairman from its midst, each board meeting is chaired by the chairman. In his absence, the board of directors may appoint a chairman from among members present.
The persons chairing the meeting may appoint a secretary, who may or may not be a director.
Any director may grant proxy to another board member, either in writing, or by telegram, telex or fax, to represent him at a particular meeting.
However, no board member may represent more than one colleague, if the board does not consist of more than six members, and more than two colleagues, where the board consists of more than six members.
Except in cases of force majeure, the board of directors may validly deliberate and take decisions only if half its members are present or represented.
If this condition is not fulfilled, a new meeting may be convened, which will deliberate and make decisions validly on the items on the agenda of the previous meeting, providing that at least two directors are present or represented.
Other than in exceptional cases, deliberations and voting may cover only the items contained in the agenda.
Any board decision is taken by an absolute majority of directors present or represented, and, in the event of abstention by one or more of them, by the majority of the other voting directors. In the event of a tied vote, the person chairing the meeting has the casting vote.
In exceptional cases, pursuant to article 521 of the Company Law, and where the urgency and interest of the company so demand, board decisions may be taken by unanimous written agreement of the directors and/or in the context of a teleconference.
This procedure may not, however, be followed for establishing the annual accounts and using the authorized capital.
Board decisions are recorded in minutes signed by the chairman of the meeting, the secretary, and members who so desire. These minutes are inserted into a special register. Proxies are attached to the minutes of the meeting for which they have been given.
Directors are compensated for the normal and justified expenditures and costs which they can prove to have incurred in the exercise of their functions.
Their fixed compensation will not be directly or indirectly linked to the operations undertaken by the company, pursuant to article 16, § 2 of the Royal Decree of 7 December 2010 on Sicafi.
Directors, persons charged with day-to-day management and the mandated agents of the company, as well as any other person mentioned in article 18 § 1 of the Royal Decree of 7 December 2010, may not act as co-contractors in operations with the company or with a company controlled by it, and may not draw any benefit from operations with said companies, except where the operation is undertaken in the interest of the company, in the framework of the planned investment policy and at normal market conditions.
Where such cases arise, the company should first inform the Financial Services and Markets Authority.
The operations mentioned in the first paragraph of this article and the information communicated in advance will be published immediately. They will also be explained in the annual report and, where applicable, the half-yearly report.
This advance information requirement does not apply to operations provided for in article 19 of the Royal Decree of 7 December 2010 on Real Estate Sicafi.
Articles 523 and 524 of the Company Law remain fully applicable.
The auditing of the company's operations is entrusted to one or more statutory auditors appointed by the general meeting for a three-year renewable term from among members of the Institute des Réviseurs d'Entreprise who are approved for auditing the accounts of investment companies and who appear on the list of the Financial Services and Markets Authority.
The statutory auditor's compensation is set by the general meeting at the time of appointment.
The statutory auditor(s) will also check and certify the accounting data included in the company's annual accounts. At the request of the Financial Services and Markets Authority, it/they will confirm in the same way the accuracy of the data that the company has transmitted to the Financial Services and Markets Authority, by way of application of article 133 of the Law of 4 December 1990 on Financial Operations and Financial Markets.
A general meeting, known as the "annual meeting" will be held every year on the first Tuesday of May at 15.00. Where this date falls on a legal holiday, the annual meeting will take place on the next working day, at the same time.
An extraordinary general meeting may be convened every time that the interest of the company demands.
General meetings may be convened by the board of directors or by the statutory auditor(s), and must be convened when requested by shareholders representing one fifth of the capital of the company. General meetings are held at the company's registered office or at any other place indicated in the letter convening the meeting or in any other way.
General meetings and extraordinary general meetings are convened by means of an announcement published a single time in the Belgian Official Gazette at least 30 days before the meeting. Except for the annual general meetings taking place at the place, date and time indicated in the articles of association and the agendas of which are limited to the customary subjects, the notice convening the meeting must appear 30 days prior to the meeting in a nationally distributed newspaper and on the company website within the same term. Where a second convening notice is required, and in so far as the date of the second meeting has been indicated in the first convening notice, the deadline for this second meeting is reduced to 17 days before the meeting.
The convening notice will mention the agenda of the meeting and the proposed resolutions.
Registered shareholders will receive convening notices by recorded delivery mail thirty days prior to the meeting.
One or more shareholders representing jointly at least 3% of the registered capital of the company can, in accordance with art. 533 ter of the Company Law, introduce items to be added to the agenda of the meeting, and proposals for decision with regard to items on, or to be added to, the agenda.
A shareholder taking part in or represented at the meeting is deemed to having been regularly invited. A shareholder may also, before and after the general meeting that he has not attended, renounce invoking the absence or irregularity of the calling of the meeting.
To be admitted to the meeting and expressing their votes, shareholders need to register their shares at latest the 14th day prior to the general meeting, at midnight (Belgian time), of by subscription to the register of nominative shareholders, or by subscription by an authorized account holder or a settlement body, or by filing the bearer shares with a financial intermediary, regardless of the amount of shares held by the shareholder on the day of the general meeting.
At latest the 6th day prior to the meeting date, the shareholder has to inform the company of his wish to attend. To that end, the financial intermediary, authorized account holder or settlement body provides a certificate to the shareholder proving the number of bearer or dematerialized shares that have been respectively filed, or registered in the name of the shareholder at the registration date, and with which the shareholder wants to participate to the meeting. Owners of nominative shares communicate their wish to participate within the same term to the company, by ordinary mail, fax or e-mail.
De company takes care of keeping a register at its office, listing all identified shareholders, by name, address or registered office, the number of shares in their possession at the registration date, and with which they have indicated wanting to participate to the meeting, accompanied by the related proof.
Any shareholder may have himself represented at a general meeting by a mandated agent, shareholder or not. Mandates have to be communicated to the company in writing, at latest the 6th day prior to the meeting; the notification can be made electronically, within the same term, at the address mentioned in the convocation. Co-owners, usufructuaries and bare owners, pledgors and pledgees must be represented respectively by one and the same person.
The company can provide for the possibility to vote in writing or electronically, according to forms and methods that it has established; in any case, the vote expressed in such a way needs to reach the meeting at latest the 6th day prior to it.
All shareholders and their mandated agents are required, prior to taking part in the meeting, to sign the attendance list, indicating the surname, given name(s) and domicile of the shareholders and the number of shares they represent.
General meetings are chaired by the chairman of the board of directors or, in the absence of the latter, by a director appointed by his colleagues or by a member of the meeting appointed by the latter. The chairman of the meeting appoints the secretary.
Where the number of persons present permits, the meeting appoints two tellers, based on a proposal by the chairman.
The minutes of the general meetings are signed by the chairman of the meeting, the secretary, the tellers, the directors present, the statutory auditor(s) and by shareholders who so wish.
These minutes are kept in a special register.
Mandates are attached to the minutes of the meeting for which they are given.
Directors reply to questions put to them by shareholders about their report or the agenda items.
The statutory auditor(s) respond(s) to questions put to him/them by shareholders about his/their audit report.
A share entitles its holder to one vote. An abstention is considered as a vote against.
No meeting may deliberate on items that are not on the agenda, except if all shareholders are present and unanimously accept to deliberate on the new items.
Except for those cases defined in the following article, the general meeting may validly deliberate, whatever the number of shares present or represented, and decisions may be taken by a major of votes present or represented.
When the general meeting is required to deliberate on:
an amendment to the articles of association;
a capital increase or decrease;
at least half of the shares representing the entirety of the capital need to be represented at the meeting. If this condition has not been fulfilled, a new meeting must be convened, which will decide validly, whatever the number of shares represented.
To be valid, decisions on the above subjects need to receive a three-quarters majority of votes taking part in the voting. This does not override the other rules of presence and majority stipulated in the Company Law, covering, among other things, the change of the company purpose, the acquisition, pledging or disposal of own shares by the companies, the winding up of the company if, following a loss, its net assets have fallen to less than a quarter of the company capital, and the conversion of the company into a company having another legal form.
Pursuant to article 9 of the Royal Decree of 10 April 1995 on Sicafi, any projected amendment of the articles of association must also be presented to the Banking, Finance and Insurance Commission. Pursuant to article 8 of the Royal Decree of 7 December 2010 on Sicafi, any projected amendment of the articles of association must also be presented to the Financial Services and Markets Authority.
The financial year begins on 1 January and ends on 31 December every year.
At the end of each financial year, the board of directors undertakes an inventory and draws up annual accounts consisting of the balance sheet, the income statement and the annex.
These documents are be drawn up in the manner required by law. The board of directors also undertakes an inventory whenever shares are issued or where shares are purchased other than on the Stock Exchange.
The annual accounts are validly signed with a view to publication either by a director, or by a person charged with day-to-day management or expressly mandated by the board of directors.
Dividends that the general meeting has decided to distribute will be paid at the times and places determined by the meeting or by the board of directors.
The board of directors may decide to proceed to distribute interim dividends and the set the date for payment of these dividends.
Any dividends or interim dividends distributed in contravention of the law must be returned by the shareholder receiving them, whenever the company can prove that the shareholder knew, or could not be ignorant in the given circumstances, that the distribution to him was contrary to the rules.
Where the company is dissolved, for whatever reason or at whatever point in time, one or more liquidators appointed by the general meeting or, in the absence of such appointment, the directors in function at that time and acting jointly, are charged with liquidating it. The liquidator(s) only take(s) up office after the confirmation of his (their) appointment by the commercial court.
In the absence of other stipulations in the deed of appointment, the persons charged with the liquidation enjoy the widest possible powers to this end, in accordance with the Company Law.
The shareholders' meeting determines the form of liquidation and the remuneration of the liquidator(s).
The liquidation is concluded according to the provisions of the Company Law.
Except in the case of merger or split, the net assets of the company, after repayment of all liabilities, will be distributed equitably between all shareholders of the company proportionally to the number of shares held by them.
Any director or liquidator of the company who is domiciled abroad is deemed, for the duration of his function, to have elected domicile at the registered office of the company, where all communications, notices and writs of summonses may be validly addressed to him.
Clauses opposed to the mandatory provisions of the Company Law and the Legislation on Sicafi are considered as non-written clauses. Consequently, the provisions of these laws derogated from in an unlawful way are deemed to be part of these articles of association.
The legal framework of Sicafi (Société d'Investissement à Capital Fixe en Immobilier) was established by the Law of 4 December 1990 and that of 20 July 2004, as well as by the Royal Decrees of 10 April 1995, 10 June 2001, 21 June 2006 and 7 December 2010. It authorizes the creation in Belgium of Undertakings for Collective Investment, as these exist in many other countries: "Real Estate Investment Trusts (REITs)" in the United States, "Fiscale Beleggingsinstellingen (FBI)" in the Netherlands, "Grundwertpapiere" in Germany, and "Sociétés d'Investissements Immobiliers Cotées (SIICs)" in France.
It was the intention of the legislator that Sicafi ensure that real estate investments would be characterized by unparalleled transparency and make it possible to distribute as much profit as possible while benefiting from numerous advantages, in particular, from tax advantages.
Supervised by the Financial Services and Markets Authority (FSMA), the Sicafi is governed by a specific regulation, the main characteristics (non-exhaustive) of which are as follows:
the portfolio must be diversified; no building can represent more than 20% of the total value of the portfolio, unless FSMA grants a derogation for a maximum of two years; it is important to point out that this derogation is withdrawn if the consolidated debt ratio of the Sicafi and its subsidiaries exceeds 33% of consolidated assets at any time of the derogation;
the rules governing conflicts of interest are very strict;
Those companies that apply to the FSMA for their accreditation as a Sicafi or that merge with a Sicafi are subject to a tax (exit tax), which is the equivalent of a tax to be paid on the underlying capital gains and on immunised reserves at the rate of 16.5%, plus the supplementary crisis contribution (currently 3%).
The information provided below is based on tax legislation and tax practices in force at the time of the drafting of this annual report. It is therefore subject to modification in the future, including with retroactive effect, and is communicated for purely information purposes. See in this connection the chapter "Risk factors". Each shareholder and each potential investor is invited to obtain information on their tax situation from their advisers.
Based on current tax legislation, the dividends distributed to the shareholders of Home Invest Belgium are not subject to any withholding tax, since Home Invest Belgium, as a residential Sicafi, has invested more than 60% of its assets in residential buildings located in Belgium.
The Law of 28 December 2011 with regard to different provisions has nonetheless introduced an additional contribution of 4% on income from movable assets, recorded in the personal income tax, applicable to physical taxpayers living in Belgium and having an income from movable assets of over € 20 020. This provision has entered into force as from 1 January 2012.
For Belgian physical persons who act in a private capacity and are subject to personal income tax, received dividends are not subject to taxes, except for, if applicable, the aforementioned additional contribution on income from movable assets of 4%.
For Belgian physical persons who act in a professional capacity, received dividends are taxable at the normal tax rate of the personal income tax.
In conformity with article 313 of the new Belgian Income tax Code physical persons will have to declare their income from movable assets in their annual income tax declaration, except the income that was subject to the special contribution of 4% at the source.
For taxpayers subject to corporate tax, dividends received are not taxed.
Belgian tax-resident companies or permanent establishments of non-resident companies in Belgium are, in principle, taxed on the dividends of a Sicafi at the corporate tax rate, without applying the "RDT" or revenues already taxed and benefiting from a deduction regime.
Thus, the dividend will be taxable in accordance with the corporate tax regime or the tax on non-residents, at the rate of 33.99% (corresponding to the base rate, plus the additional 3% crisis contribution). A reduced rate could be applicable under certain conditions.
There is no withholding tax on the dividends paid by Home Invest Belgium.
In Belgium, the capital gains made by a physical person from the sale of shares as part of the normal management of his private assets are not taxable, and capital losses are not tax-deductible. Belgian physical persons can, however, be subject to taxation of respectively 33%, plus additional community taxes, the rate of which depends on the district of residence, if the capital gains made are considered speculative.
They can also be subject to taxation of 16.5%, plus additional community tax, the rate of which depends on the district of residence, if the shares are sold to a foreign company and if they relate to a stake of more than 25% in the company's share capital. Belgian physical persons holding these shares within the scope of a professional activity are taxed on the capital gains they make on the sale of shares at the ordinary progressive rates of personal income tax, or at 16.5%, if the shares are held for more than five years.
For Belgian legal entities subject to tax on legal entities, the capital gains made on the sale of Home Invest Belgium shares are not, in principle, taxable in Belgium. Capital losses on shares are not taxdeductible.
Capital gains made on Home Invest Belgium shares by a Belgian company or by a foreign company having a permanent establishment in Belgium are fully taxable. Capital losses (expressed or realised) are not tax-deductible.
Capital gains made by physical non-resident persons on Home Invest Belgium shares are in principle part of private assets and are not taxable in Belgium. Capital losses are not tax deductible. The citizens of the countries with which Belgium has concluded a double taxation convention are not, in principle, subject to taxation on such capital gains in Belgium.
The subscription of new shares (primary market) is not subject to the Tax on Stock Market Transactions ("TOB").
However, the purchase and sale and any other acquisition and sale for valuable consideration in Belgium, via a "professional intermediary", of existing shares (secondary market) is subject to a tax on stock market transactions, since 1 January 2012, 0.22% (0.25% as from 01/05/2012) of the transaction price. The amount of the TOB is limited to € 650 (e 740 as from 01/05/2012) per transaction and per party.
The following persons, regardless of the circumstances, are exempted from TOB:
Starting on 1 January 2008, in accordance with the Law of 14 December 2005, Home Invest Belgium shares can no longer be physically delivered.
This annual financial report contains forward-looking statements. Such statements include unknown risks, uncertainties and other factors that could cause the results, financial position, performance and current results to differ from the results, financial position, performance and results expressed or implicitly communicated by such forward looking statements. In view of these uncertain factors, the forward-looking statements are not subject to any guarantee.
The Managing Director, Xavier Mertens, who is one of the company's three effective directors, is responsible for the information communicated in this annual financial report.
He did everything in his power to verify the information contained in this annual financial report and declares that after having taken all reasonable measures in this connection, the information contained herein reflects, to the best of his knowledge, the actual situation and that no information likely to alter the scope of this annual financial report has been omitted. To the best of his knowledge:
Home Invest Belgium further declares that third-party information has been faithfully reproduced in this annual financial report and provided that the Sicafi is aware of it and is able to assure it based on the information published by these third parties, no fact has been omitted that would cause the information reproduced to be inaccurate or misleading.
The annual financial reports (which include the consolidated financial statements, with an abbreviated version of the statutory financial statements, the consolidated management reports, the auditor and surveyor reports), the interim statements, half-year financial reports, description of the financial position, information concerning the linked parties and the historical financial information concerning the Sicafi's subsidiaries for the years 2010 and 2009, are included by reference in this annual financial report. These documents can also be consulted and downloaded on the website www.homeinvestbelgium.be.
As regards any governmental, economic, budgetary, monetary or political strategy or factor having had a significant impact or that could have a significant impact, whether directly or indirectly, on the operations of Home Invest Belgium, see chapter I "Risk factors", in particular, points 2 and 9.
5.4 Judicial proceedings and arbitration proceedings in progress No proceedings have taken place recently, or that could have significant effects on the financial position or profitability of Home Invest Belgium.
Home Invest Belgium declares:
noneofitsdirectorsormembersofExecutiveManagement has been found guilty of fraud, or has been the subject of any official offence and/or public penalty and no penalty has been levied by a legal authority or supervisory authority and that, in their capacity as director, they were not involved in a bankruptcy, or placed under compulsory administration or liquidation;
• the directors and members of the Executive Management have not been prohibited by a court from acting as a member of the Board of directors or Executive board, or from participating in the management or administration of Home Invest Belgium's affairs;
During the year under review no transaction was executed that had an impact of more than 25% on the company's activity indicators, according to the meaning of paragraphs 91 and 92 of the CESR's recommendation on the implementation of European Commission Directive No. 809/2004 on prospectuses.
Thus, the publication of pro forma financial information is not required.
The incorporation document and articles of association of Home Invest Belgium can be consulted at the Registry of the Brussels commercial court and at the company's registered office.
The annual financial statements are filed with the National Bank of Belgium. Each year, the annual financial statements and the related reports are sent to the registered shareholders and to any person who so requests.
Meeting notices inviting shareholders to the General meetings of the shareholders and the other mandatory publications are published in the financial press and on the aforementioned website. The interim statements, the half-year financial reports and the annual financial reports contain the net asset value per share, as well as the valuation of the Home Invest Belgium real estate portfolio.
Decisions concerning the appointment and revocation of the members of the Board of directors are published in the annexes to the Belgian Official Gazette.
Whoever wishes to do so can register free of charge on the website www.homeinvestbelgium.be, in order to receive e-mail press releases and mandatory financial information by e-mail.
No significant changes of the financial or commercial position of Home Invest Belgium have taken place since the end of the financial year 2011.
• There have not been any operations with affiliated companies according to the meaning of article 19 of the Prospectus regulation (cf. art. 19), except for the partial demerger of the SA VOP on 23 December 2011 (see above sub point 8 of the management report).
• The significant contracts concluded during the past two financial years of the Sicafi are identified in the management report of this annual financial report, or in that of the year 2010, which can be consulted on the company's website (cf. art. 22).
Is the rent applying on 31 December 2011, on an annual basis, excluding rental guarantees and the estimated rental value on unoccupied spaces.
Is the rental value which the real estate surveyor sees as corresponding to a market rent.
The fair value of a building or a portfolio of buildings is its investment value, after deduction of mutation costs, calculated as follows:
Floor and Cap are financial products protecting the client from respectively a decrease and an increase of the interest rates.
The gross passing rent represents the last gross rental income, paid either monthly or quarterly, on 31 December 2011, converted into an annual total and including where necessary rental guarantees and the estimated rental value of unoccupied premises. It takes into account furniture if available. It can therefore differ from the rent received during the financial year and inserted into the income statement, e.g. if there was a vacant period or if there has been an index-linked change in the meantime.
An 'Interest rate swap' is an exchange of interest rates between two parties in view of the exchange of their exposure to the risk of changes in interest rates.
The net asset value or intrinsic value, in total or per share, is the value of the net assets, in total or per share, taking into account the latest fair value of the property portfolio, as defined by the real estate surveyor of the Sicafi. In IFRS, the net asset value comprises the year-end dividend, awaiting the approval by the ordinary general meeting of shareholders.
(Net result – portfolio result) / property result.
The net current result is equal to the net result minus the portfolio result.
The net current result excluding the capital gains or losses on hedges that are ineffective according to IAS 39.
Is the average rate of occupancy, calculated on the basis of rents and including rental guarantees, for the whole financial year. All investment properties of the portfolio are taken into account for the calculation, excluding the development projects and the assets held for sale.
(Operating result before the portfolio result) / property result.
(Pre-tax result – portfolio result) / property result.
The payout ratio corresponds to the appropriated dividend in comparison with the distributable result, calculated on a consolidated basis.
The surfaces are those taken into account by the Sicafi's real estate surveyor. They include 50% of terraces and 10% of private gardens.
Shareholders' return is equal to the dividend of the financial year plus the growth of the net asset value during the financial year.
Credit in the medium or long term that can be withdrawn under the form of one or more advances that can or can't be renewed in the short term. The duration of the advances is spread out over consecutive interest rate periods, each with their defined interest rate. That way, investments in the medium or long term can be financed with interest rates that are variable in the short term, and consequently more favourable.
Advance with a fixed term. Credit under the form of cash advances of a fixed amount and for a fixed duration that have to be integrally reimbursed at their expiry date.
Velocity is the ratio between the yearly traded volume and the total number of shares comprised in the free float.
The year the property was built or of its last major renovation.
This annual report is a registered document in the sense of article 28 of the Law of 16 June 2006 on public offers of investment instruments and on the admission of investment instruments to trading on regulated markets.
It has been approved by the FSMA, in accordance with article 23 of the above-mentioned law on 13 March 2012.
Home Invest Belgium having opted for the French as official language, the annual financial report in French is the sole official version. The Dutch and English versions are translations established under Home Invest Belgium's responsibility.
Het financieel jaarverslag in het Nederlands is beschikbaar op de zetel van de vennootschap.
Le rapport financier annuel en Français est disponible au siège de la société.
Design and layout: www.theimagecompany.be
Belgian Sicafi Boulevard de la Woluwe 60/4, B -1200 Brussels
T +32 2 740 14 50 - F +32 2 740 14 59 [email protected] www.homeinvestbelgium.be RPM : 0420.767.885 ISIN BE 003760742
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