euro adhoc: conwert Immobilien Invest AG
quarterly or semiannual financial
statement
conwert Immobilien Invest AG with excellent revenue and earnings
growth in the first three quarters of 2007
Disclosure announcement transmitted by euro adhoc. The issuer is responsible for the content of this announcement.
29.11.2007
conwert Immobilien Invest AG with excellent revenue and earnings growth in the first three quarters of 2007
Vienna, 29 November 2007. conwert Immobilien Invest AG (Vienna Stock Exchange: CWI, Reuters: CONW.VI, Bloomberg: CWI AV) continued its excellent development during the third quarter of 2007, and recorded a further improvement in revenues and earnings. All financial indicators reached new record levels for the first nine months: earnings before interest and tax (EBIT) increased 87% to EUR 137.70 million, funds from operations (FFO) rose 134% to EUR 60.33 million. FFO per share reached EUR 0.79, after EUR 0.50 in the comparable prior year period. The conwert property indicators also showed a significant improvement: property assets rose to EUR 2.15 billion and the book value (NAV) per share increased 9% to EUR 15.52. During the fourth quarter of 2007 conwert will continue to expand its market position not only in Austria and Germany, but also through selective acquisitions in the CEE region. These projects are expected to increase the property portfolio to EUR 2.2 - 2.4 billion.
The excellent results recorded for the first three months of 2007 confirm that the operating activities of conwert have not been directly affected by the worldwide turbulence on financial and capital markets in the wake of the US mortgage crisis. With its business model, conwert will be able to continue its growth course and realise an above-average increase in cash inflows - funds from operations.
Expansion of the property portfolio to EUR 2.15 billion During the first nine months of 2007, conwert increased its property portfolio through acquisitions and the development of new locations in Germany. The property portfolio now includes 1,387 objects with a total value of EUR 2.15 billion, which represents an increase of EUR 473 million within the first 9 months. A total of 159 properties with a combined value of EUR 104 million were acquired during the third quarter. The usable space in the property portfolio totalled approx. 1,661,000 m² as of 30 September 2007.
The company increased its focus on sales activities during the reporting period, and marketed 37 individual objects as well as numerous condominium apartments. The proceeds on sale equalled EUR 171.22 million, or roughly 20% more than the IFRS carrying values of EUR 142.25 million.
New records for revenues and earnings Revenues for the first three quarters of 2007 rose to EUR 248.40 million, which represents a year-on-year increase of 89%. This growth was supported by higher rental income (+41% to EUR 77.18 mill.) following the expansion of usable space as well as an increase in prices on new rentals and a significant rise in the proceeds generated by the ongoing sale of properties (+124% to EUR 171.22 mill.). The profit margin on the IFRS carrying values of the properties sold reached 20%, in comparison with the 2006 value of 18%, and the gain on sale totalled EUR 28.97 million. On a cash basis, the gain on sale exceeded the acquisition cost of these objects by 23.5%.
The conwert earnings indicators set new records during the first nine months of 2007. Funds from operations rose from EUR 25.80 million to EUR 60.33 million, for an increase of 134%. Earnings before interest and tax (EBIT) reached EUR 137.70 million, exceeding the first three quarters of 2006 by 87% and the entire prior year value of EUR 104.42 million by 32%. This development was also supported by the company´s strategy to increase the value of the property portfolio through the development of older buildings. The revaluation of properties by independent experts led to a net gain of EUR 80.98 million from the adjustment of fair value (3.8% of the property portfolio, or 58% of EBIT). Financial results of EUR -21.09 million nearly matched the prior year level of EUR -19.18 million, despite a significant rise in the volume of financing. Decisive factors for this improvement were the proportional share of earnings from the partial consolidation of ECO Business-Immobilien AG totalling EUR 1.87 million and a non-recurring effect of EUR 1.77 million from the initial consolidation as well as a substantial increase in finance income to EUR 15.2 million. Earnings before tax (EBT) increased 115% to EUR 116.61 million.
Earnings per share for the first three quarters of 2007 rose by 58% to EUR 1.15, in spite of an increase in the number of shares outstanding. Adjusted earnings per share based on actual income taxes paid equalled EUR 1.53, compared with EUR 1.05 for the first three quarters of 2006.
Excellent financial position and increase in substance value Equity rose to EUR 1,352 million as of the balance sheet date on 30 September 2007, resulting in an equity ratio of 54%. conwert has a sound financial basis to support its future expansion, which was further improved by the placement of EUR 196.40 million in convertible bonds in November of this year.
The inherent value (NAV) of the conwert share also showed sound development, rising by 9% to EUR 15.52 over the past 12 months. Adjusted NAV per share, which also includes undisclosed reserves in the property portfolio and deferred taxes, increased from EUR 17.81 to EUR 19.89. This represents an improvement of 12%.
Positive outlook on 2007 conwert readied a number of property acquisitions during the third quarter of 2007 that have since been closed. The company will utilise further opportunities for acquisitions during the last three months of this year, and expand the property portfolio to approx. EUR 2.2 - 2.4 billion. In addition, the active management of investment properties is expected to generate higher rental income.
For the full reporting year, conwert expects revenues of EUR 329 - 370 million. Earnings before interest and tax (EBIT) should reach EUR 178 - 190 million, net profit EUR 105 - 115 million and earnings per share EUR 1.32 - 1.44 (diluted earnings per share, including the convertible bonds issued in November 2007).
Selected Key Data
Key company figures in EUR m
1-9/2007 1-9/2006 Change 2006
Rental income 77.18 54.73 41% 79.54
Proceeds from the
sale of properties 171.22 76.57 124% 185.46
Revenues 248.40 131.30 89% 265.00
Earnings before interest
and tax (EBIT) 137.70 73.45 87% 104.42
Financial results -21.09 -19.18 - -27.39
Earnings before tax (EBT) 116.61 54.27 115% 77.03
Profit for the period 88.81 37.48 137% 51.67
Profit for the period after
minority interest 87.34 37.51 133% 51.82Balance sheet total 2,516.06 1,848.18 36% 1,921.85 Equity 1,351.48 843.39 60% 857.99 Equity ratio in % * 53.71 45.60 - 44.6 Adjusted equity ratio in % ** 54.18 46.27 - 45.3
Funds from operations (FFO)*** 60.33 25.80 134% 64.62
* Equity including minority interest ** Equity including financing contributions from tenants *** Earnings before interest and tax (EBIT) - net gain on the adjustment of fair value + cash gains on the sale of properties in relation to IFRS gains on sale
Key property figures
30.09.2007 30.09.2006 Change 31.12.2006
Number of objects 1,387 963 44% 981
Rental units 19,964 14,993 33% 15,376
Total usable space in sqm 1,661,015 1,262,827 32% 1,322,412
Parking spaces-/
garage spaces 5,508 3,416 61% 4,298
Property assets in EUR m 2,146.69 1,598.52 34% 1,673.37Key stock exchange figures
30.09.2007 30.09.2006 Change 31.12.2006
Earnings per share in EUR 1.15 0.73 58% 0.97
Adjusted earnings per
share in EUR 1.53 1.05 46% 1.44
Share price in EUR
at end of period 12.96 15.90 - 19% 16.40
Book value/share in EUR 15.52 14.24 9% 14.49
Adjusted NAV/share in EUR 19.89 17.81 12% 19.19
Number of shares
at end of period 85,359,273 58,684,500 45% 58,684,500
Market capitalisation EUR m 1,106.26 933.08 19% 962.43
Price/earnings ratio 11.27 21.86 - 16.91
Price/adjusted earnings ratio 8.47 15.09 - 11.39end of announcement euro adhoc 29.11.2007 07:30:00
Further inquiry note:
For additional information contact:
conwert Immobilien Invest AG, Johann Kowar, Chairman of the Management Board,
T +43 / 1 / 521 45-0, E kowar@conwert.at
Hochegger|Financials, Roland Mayrl, T +43 / 1 / 504 69 87-31,
E r.mayrl@hochegger.com
Branche: Real Estate
ISIN: AT0000697750
WKN: 069775
Index: WBI
Börsen: Wiener Börse AG / official dealing