Mobimo Holding AG — Interim / Quarterly Report 2017

Aug 4, 2017

2017 Half-year results

The financial data as well as the other information presented herein constitute selected information.

The information in this presentation does not constitute an offer or invitation and may not be construed as a recommendation by us to purchase, hold or sell shares of Mobimo Holding AG. This information or any copy thereof may not be sent or taken to or distributed in any jurisdiction in which such transmission or distribution is unlawful. This document may contain certain "forward-looking" statements. By their nature, forwardlooking statements involve risk and uncertainty because they relate to future events and circumstances. Actual outcomes and results may differ materially from any outcomes or results expressed or implied by such forward-looking statements.

• 1. First half-year 2017 at a glance
• 1. Key financial figures first half-year 2017
• 1. Property portfolio and pipeline
• 1. Focus and outlook

1. First half-year 2017 at a glance

A strong half-year performance 1. First half-year 2017 at a glance

CHF million HY|2016: 89.8

• A strong performance once again after the extraordinary record results of the previous year
• Good operating results in all areas

56.4 Rental income CHF million HY|2016: 56.8

91.2

● Stable rental income and low vacancy rate despite portfolio disposals

CHF

HY|2016: 14.39

● On track to continue the stable and attractive dividend policy

Income from sales and services CHF million HY|2016: 59.7

• 74 transfers of ownership, mostly in Aarau's Aeschbachquartier
• Expanded pipeline for third-party projects

Market environment 1. First half-year 2017 at a glance

Economic environment	● Switzerland offers a stable environment / Trend in real economic growth slightly positive since 2015 / Inflation set to be in marginally positive territory again ● Swiss franc becoming more competitive against the euro again ● Attractive location for real estate investments / Real estate offers a very high yield premium over bonds despite price rises in recent years
Political environment	● Regulation is tending to result in a shortage of land, thus making it more expensive ● Insufficient use of density and a lack of implementation are making supply more expensive
Residential real estate market (rental)	● Persistently high demand for rental apartments in urban centres ● Easing demand in less central areas / Some signs of overproduction in peripheral areas ● Decline in annual net immigration / Change in structure of immigration
Residential real estate market (condominiums)	● Persistently high demand for low and mid-priced condominiums in good locations ● Ongoing positive effect on demand from the current low interest rate environment
Commercial real estate market (rental)	● Demand for office space trending sideways overall ● Tough competition leading to structural adjustment in the retail sector ● Slight increase in demand for cheap commercial space ● Ongoing digitalisation impacting demand for retail space – and office space in the medium term – leading to changes in future user needs
Transaction market	● Continuing high demand for investment opportunities in residential properties and selected commercial properties

Highlights of a sustainable development strategy 1. First half-year 2017 at a glance

• Foundation stone laid: May 2017
• 129 rental apartments and commercial space
• Planned completion: 1st half of 2019
• Start of marketing of the rental apartments: 2018

• Commercial letting rate: ca. 60%

• Foundation stone laid: Sept 2016

• 201 rental apartments and 10 commercial spaces
• Planned completion: 1st half of 2018
• Start of marketing of the rental apartments: spring 2017
• Rental letting rate: ca. 95%

Kriens, Mattenhof Zurich, Labitzke Aarau, Aeschbachquartier

● Foundation stone laid: Sept 2016 / April 2015

Rental apartments

• 167 rental apartments
• Planned completion: mid-year 2018
• Start of marketing of the rental apartments: end of 2017

Condominiums for sale

● Transfers of ownerships: 63/92

2. Key financial figures first half-year 2017

Key figures on the income statement 2. Key financial figures first half-year 2017

CHF million	2014	2015	HY 2016	HY 2017	Change y-o-y
Rental income	105.1	107.8	56.8	56.4	 - 0.7%
Direct expenses for rented properties	- 17.6	- 13.8	- 8.5	- 7.8	 - 8.7%
Net rental income	87.6	94.1	48.3	48.6	 0.7%
• Direct cost/income ratio for rented properties	17%	13%	15%	14%	 - 8.0%
EPRA like-for-like rental growth	0.6%	0.8%	0.4%	- 0.1%	 - 125.0%
Income from sale of trading properties and development services	157.3	86.2	59.7	91.2	 52.8%
Direct expenses from sale of trading properties and development services	- 132.4	- 80.7	- 42.7	- 77.8	 82.4%
Profit on sale of trading (properties) and development services	24.9	5.5	17.0	13.3	 - 21.6%
• Gross yield	16%	6%	28%	15%	 - 48.7%

Key figures on the income statement 2. Key financial figures first half-year 2017

CHF million/CHF	2014	2015	HY 2016	HY 2017	Change y-o-y
Net income from revaluation	3.8	34.7	20.9	30.6	 46.5%
Profit on disposal of investment properties	4.9	63.8	33.9	17.8	 - 47.6%
Operating result (EBIT) incl. Revaluation	97.6	170.4	105.2	92.9	 - 11.7%
Operating result (EBIT) excl. revaluation	93.8	135.7	84.4	62.3	 - 26.1%
Tax expense	- 4.8	- 34.1	- 2.9	- 16.0	 444.6%
Profit	63.2	105.0	89.8	63.3	 - 29.5%
Profit attributable to the shareholders of MOH	62.2	103.9	89.5	62.4	 - 30.3%
Profit attributable to the shareholders of MOH excluding revaluation	60.2	78.6	74.2	40.1	 - 45.9%
Earnings per share	10.00	16.72	14.39	10.03	 - 30.3%
Earnings per share excluding revaluation	9.69	12.65	11.93	6.46	 - 45.9%
EPRA earnings per share	8.13	8.17	3.61	4.05	 12.2%

Key figures on the real estate portfolio 2. Key financial figures first half-year 2017

	2014	2015	2016	HY 2017		Change y-o-y
Average discount rate for revaluation (real)	4.39%	4.08%	3.75%	3.62%		- 3.5%
Vacancy rate	5.4%	4.7%	4.8%	4.9%		2.1%
Gross yield from investment properties	5.6%	5.4%	5.3%	5.3%		0.0%
Net yield from investment properties	4.5%	4.3%	4.1%	4.1%		0.0%
Average financing costs (period)	2.5%	2.5%	2.4%	2.1%		- 12.6%
Yield spread	2.0%	1.8%	1.7%	2.0%		17.6%

Change in rental income and vacancy rate 2. Key financial figures first half-year 2017

• Steady increase in rental income through the addition of new investment properties with low vacancy rates from the development pipeline for Mobimo's own portfolio
• Additional increase in rental income through acquisitions

• Investment properties under construction for our own portfolio contain a total investment volume of around CHF 480 million and a potential rental income of CHF 25 million p.a.

• Key financial figures first half-year 2017

Long-term maturity profile of rental agreements and top tenants

Maturity profile of fixed-term rental agreements1)

The top 5 tenants

1) Not including rental agreements of unlimited duration

2. Key financial figures first half-year 2017

Change in sale of trading properties and development services

• CHF 81 million of income from sale of trading properties
• 74 apartments transferred to new owners, mostly in Aarau's Aeschbachquartier
• Targeted expansion of the pipeline for condominium projects through the purchase of a plot of land in Meggen in the canton of Lucerne
• CHF 10 million of income from development services through the realisation of the attractive pipeline for third-party developments
• Total investment volume of around CHF 800 million for third-party developments

Long-term financing at excellent conditions 2. Key financial figures first half-year 2017

• Bond issue to further diversify long-term financing
• Issue date: 20 March 2017
• Issue volume: CHF 225 million
• Coupon: 0.75% p.a.
• Maturity: 9 years (to 2026)

	31 December 2016	30 June 2017
Ø residual maturity as at reporting date	6.9 years	6.8 years
Ø interest rate as at reporting date	2.32%	2.02%

3. Property portfolio and pipeline

Performance of overall portfolio 3. Property portfolio and pipeline

Total value: CHF 2,728 million (2016: CHF 2,766 million)

CHF million	2016	HY 2017		Change
Investment properties	2,112	2,060		- 2.5%
 Commercial properties	1,388	1,341		- 3.4%
Residential properties	724	719		- 0.7%
Development properties	654	668		2.1%
 Commercial properties(investment)	209	211		1.0%
 Commercial properties (trading)	59	59		0.0%
 Residential properties (investment)	140	194		38.6%
 Residential properties (trading)	246	204		- 17.1%

Site development: Aarau, Aeschbachquartier 3. Property portfolio and pipeline

• Conversion of the former industrial site to a mixed-use urban district
• 167 rental apartments, 92 condominiums and 4,600 m² of commercial space
• Investment volume: CHF 170 million (excl. GastroSocial premises)
• Expected rental income: CHF 5.3 million

3. Property portfolio and pipeline

Site development: Aarau, Aeschbachquartier – sustainability

Site development: Lausanne (Flon), Les Garages 3. Property portfolio and pipeline

Usable area m²

2,046

Studios and office spaces Number 31

10 Investment volume CHF million

Expected rental income CHF million 0.5

Occupation

planned from 9.2017

Site development: Kriens, Mattenhof 3. Property portfolio and pipeline

Usable area

^m2 37,885

Apartments Number + Commercial, retail and gastro 129

Investment volume

CHF million (without Development for Third Parties)

Expected rental income CHF million 10.3

175

Occupation

planned from 3.2019

Site development: Zurich, Labitzke 3. Property portfolio and pipeline

Usable area m²

15,583

Rental apartments/studios

Number

+ 10 commercial spaces

Investment volume

CHF million (without Development for Third Parties)

Expected rental income CHF million 5.1

110

201

Occupation

planned from 4.2018

Development for Third Parties 3. Property portfolio and pipeline

Bad Zurzach, Weissensteinweg

Apartments

Units

97

• Rentable area: 8,547 m²
• Start of construction: September 2015 (first stage) and August 2016 (second stage)
• Planned occupation: October 2017 resp. May 2018

Unterengstringen, Langwisenstrasse

Apartments Units

30

• Rentable area: 2,272 m²
• Start of construction: April 2017
• Start of marketing: September 2017
• Planned completion: September 2018

Killwangen, Zürcherstrasse

Apartments

Units

• Rentable area: 7,369 m²
• Start of construction (planned): July 2018
• Planned completion: 2020

Zurich, Albulastrasse (Labitzke)

Apartments Units

76

• Commercial units: 2
• Rentable area: 6,258 m²
• Start of construction: January 2016
• Planned occupation: July 2018

Varied site development throughout Switzerland 3. Property portfolio and pipeline

• Current and future projects with potential investment total of around CHF 1.6 billion
• 100% Minergie-certified
• Internal sustainability rating

4. Focus and outlook

Focus in 2017 4. Focus and outlook

Strategy	● Further expansion of the activities and services of Development for Third Parties ● Selective production of condominiums ● Continuation of the attractive dividend policy
Operating business	● Stable rental income, low vacancy rate and high level of tenant satisfaction ● Reinforcement of the service offering for customers through our own facility management ● Strict cost and risk management
Real estate portfolio	● Successful realisation of planned construction projects ● Continued increase in quality and growth of our own portfolio through targeted developments and purchases ● Targeted portfolio diversification to achieve a balanced portfolio mix
Transaction market	● Ongoing review of purchase and sales opportunities ● Reinvestment of sales proceeds in projects from the pipeline

Mobimo – Well-equipped for the future 4. Focus and outlook

Stable income	● High-value real estate portfolio in prime locations in Switzerland ● Diversified investment portfolio ● Low vacancy rate
Growth and rising income	● Attractive development pipeline at top locations in Switzerland
Security	● High equity ratio and long-term financing at low interest rates form an excellent foundation for further growth and for investments in the planned projects of the pipeline
Know-how	● Solid business model, excellent positioning ● A capable and committed Mobimo team
Return	● Share with a stable return ● Attractive dividend of CHF 10.00

Your contact persons

Christoph Caviezel CEO

• Dr. iur., attorney at law
• Chairman of the Executive Board
• CEO of the Mobimo Group since October 2008
• Direct Manager of the Purchase and Divestment Division
• Several successful years as CEO and member of the BoD of a listed Swiss real estate company

christoph.caviezel@mobimo.ch manuel.itten@mobimo.ch

ir@mobimo.ch, Tel. 044 397 11 86

Manuel Itten CFO

• Business Administration FH
• Member of the Executive Board
• Joined Mobimo in 2004, working as CFO since 2009
• Head of Controlling until February 2009
• Longstanding experience in the real estate market

Annex

Annex

Long-term strategy for qualitative growth and stable returns

Capital gains	Appreciation in value	Rental income
. Profit on trading properties and development services • Profit on sale of investment properties	. Increasing total value of the portfolio • Quality optimisation of the portfolio • High level of customer satisfaction • Net income from revaluation	• Stable and growing rental income • Net rental income • Return on equity including/ excluding remeasurement . Gross yield from investment properties . Net yield from investment properties

Development for Third Parties	Development properties	Investment properties
Buying/selling	Development	Portfolio management	Solid financing
• Successful acquisitions . Good regional and user-specific diversification	• Many aspects to site . Planning and realising residential and commercial properties • Planning and realising condominiums for third parties • Considering the needs of the environment	• Strategic development • Portfolio optimisation · Considering environmental, economic and social aspects • Reacting quickly and flexibly to changes in the market	• Appropriate equity ratio for further qualitative growth • Long-term guaranteed financing at excellent conditions

Concentration of properties in key economic areas Annex

Well-balanced and stable portfolio mix Annex

• The portfolio mix is subject to continuous optimisation
• The residential component is gradually being increased through the planning and construction of investment properties for the company's own property portfolio
• Residential component in target range of 30%
• The portfolio mix of the investment portfolio comprises approximately one-third residential usage, one-third office usage and one-third other commercial usage

Solid equity ratio as basis for further high-quality growth Annex

• Target of > 40% continues to be met
• Capital base still solid

● Target of > 2 comfortably exceeded ● Substantially below the maximum

• limit of 150%
• High degree of financing leeway

Key figures for Mobimo shares Annex

	2014	2015	2016	30.6.2017		Change y-o-y
Number of registered shares issued	6,216,606	6,218,170	6,218,170	6,218,170		0.0%
NAV per share, diluted (CHF)	195.93	202.45	217.33	217.66		0.2%
Share price as at 30 June (CHF)	199.20	222.70	254.75	269.00		5.6%
Premium to NAV	2%	10%	17%	24%		41.2%
Market capitalisation (CHF million)	1,238.3	1,384.8	1,584.1	1,672.7		5.6%
Distribution for previous year (CHF)	9.50	10.00	10.00	10.00		0.0%
Dividend yield	4.8%	4.5%	3.9%	3.7%		- 5.1%

Shareholder structure Annex

• Free float as at 30 June 2017: 100% (as per SIX Swiss Exchange definition)
• The following shareholders held 3% or more of the share capital as at 30 June 2017:
• BlackRock, Inc., 4.97%
• Zuger Pensionskasse, 3.38%
• Norges Bank (the central bank of Norway), 3.17%

	Investment properties for our own portfolio					Condominiums for sale
	2017	2018	2019	2020	2017	2018	2019	2020
Under
construction
In planning
					Sale of plots
Investment	CHF 480 million CHF 370 million (prior year: CHF 480 million) (prior year: CHF 370 million)					CHF 10 million (prior year: CHF 80 million)		CHF 100 million (prior year: CHF 100 million)

Investment properties for our own portfolio
2017	2018	2019	2020	Project	Usage
		Under construction: CHF 480 million (prior year: CHF 480 million)
				Aarau, Site 2 (Torfeld Süd)	6 residential/office buildings, 167 apartments
				Horgen, Seestrasse 93 (Seehallen)	Commercial and retail
				Kriens, am Mattenhof 4, 6, 8, 12/14, 16	Office, residential, retail, hotel, 129 apartments
				Lausanne, Rue Côtes-de-Montbenon 1/3/5 (Les Garages)	Small businesses
				Rheinfelden, Rütteliweg 8/Spitalhalde 40	Renovation, 84 apartments
				Zurich, Hohlstrasse 485	10 office/commercial units, 201 apartments, 80 parking spaces

Investment properties for our own portfolio
2017	2018	2019	2020	Project	Usage
	In planning: CHF 370 million (prior year: CHF 370 million)
				Aarau, Bahnhofstrasse 102 (Mediapark)	Refurbishment of commercial space
				Lausanne, Avenue Edouard Dapples 9, 13, 15, 15a (GMR)	Renovation of residential property
				Lausanne, Rasude site development	Urban development
				Lausanne, Rue de Genève 19/21 (Jumeaux)	Retail, office, storage
				Lausanne, Rue de la Vigie 3	Hotel
				Lausanne, Rue de la Vigie 5	Residential, office, retail
				Lausanne, Rue des Côtes-de-Montbenon 8-14	Residential, office, retail

Condominiums for sale
2017	2018	2019	2020	Project	Usage
	Under construction: CHF 10 million (prior year: CHF 80 million)
				Bad Zurzach, Weissensteinweg (Salzturm)	21 apartments
In planning: CHF 100 million (prior year: CHF 100 million)
				Merlischachen, Chappelmatt-Strasse (Burgmatt)	78 apartments, 140 parking spaces
Sale of plots				Weggis, Hertensteinstrasse 105	open

Address	Fair value as at 30.6.2017 in TCHF	Usage
Lausanne, Horizon 4-6 Avenue d'Ouchy 4-6	127,930	Commercial property
Zurich, Mobimo Tower Hotel Turbinenstrasse 18	122,310	Hotel
Affoltern a. A., Obstgartenstr. 9/ Alte Obstfelderstr. 27/29, 31-35	110,110	Retirement home, retirement and rental apartments
Lausanne, Ilot du Centre Rue Beau Séjour 8	103,750	Rental apartments

1) Total fair value CHF 1,088 million

Address	Fair value as at 30.6.2017 in TCHF	Usage
Zurich, Friesenbergstrasse 75/ Im Tiergarten 7	86,800	Commercial property
Lausanne, Petit Mont-Riond Rue Voltaire 2-12	74,600	Rental apartments
Lausanne, Les Merciers Voie du Chariot 4-7	68,080	Commercial property
Zurich, Letzigraben 134-136	67,000	Rental apartments

1) Total fair value CHF 1,088 million

Address	Fair value as at 30.6.2017 in TCHF	Usage
Zurich, Mobimo Skyscraper Hardturmstrasse 3/3a/3b	63,230	Commercial property
Regensdorf, Sonnenhof Schulstrasse	61,460	Rental apartments
Kreuzlingen, Ziil Center Leubernstrasse 3/Bottighoferstrasse 1	57,460	Commercial property
Lausanne, Les Pépinières Rue des Côtes-de-Montbenon 20-24	43,900	Commercial property

1) Total fair value CHF 1,088 million

Address	Fair value as at 30.6.2017 in TCHF	Usage
Onex, Avenue des Grandes-Communes 21-23-25	37,800	Rental apartments
Lausanne, Rue de Genève 7	33,400	Commercial property
Lausanne, Place de la Gare 4	30,490	Commercial property

Site development: Lausanne, Rasude Annex

2017	2018	2019	2020	2021	2022	2023

Site area

19,000 m² (12,000 m² Mobimo)

Usage

Offices, hotel, apartments (condominiums/rental apartments), retail, gastronomy (joint project with Swiss Federal Railways)

Investment Approx. CHF 270 million

Location

Right next to Lausanne train station

Site development: Aarau, Aeschbachquartier Annex

Site area 55,000 m² (incl. park)

Usage

1,100 workplaces, 92 condominiums, 167 rental apartments, retail, gastronomy, commercial

Investment

Approx. CHF 170 million (excluding third parties)

Location

Central, near Aarau train station

Site development: Lausanne, Flon Vision 2025 Annex

2017	2018	2019	2020	2021	2022	2023

Site area 55,000 m²

Usage

Further development of the Flon district

Investment Approx. CHF 200 million

Location

Central, in the immediate vicinity of a metro station

Site development: Lucerne South (Kriens), Mattenhof Annex

Site area 25,000 m²

Usage

Offices, commercial, hotel, apartments, retail, gastronomy

Investment Approx. CHF 260 million

Location

Mattenhof train station, in the immediate vicinity of the motorway junction

Site development: Biel/Bienne, Agglolac Annex

2017	2018	2019	2020	2021	2022	2023

Gross site area Approx. 110,000 m²

Usage

Development of a city district, offices, commercial, hotel, apartments (condominiums/rental apartments), retail, gastronomy (project with the towns/cities of Nidau and Biel/Bienne)

Investment

Approx. CHF 350 million

Location

Next to the lake, near the train station

Site development: Zurich Oerlikon, Rheinmetall Annex

Gross site area 53,000 m²

Usage

Offices, commercial, apartments (condominiums/rental apartments), gastronomy, events

Investment Approx. CHF 500 million

Location Near Oerlikon train station

Site development: Allaman, canton of Vaud Annex

Site area 25,000 m²

Usage (planned) 300 compact apartments (26,100 m² main usable area)

Rental

Tenants: logistics; rental agreements run until 31 December 2019

Location

Wine-growing village to the south-west of Morges; right next to the train station on a gentle slope facing the lake