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Corestate sees weak business performance in the first nine months of 2022 – goodwill impairments and one-off effects negatively impact adjusted net profit

EQS-News: Corestate Capital Holding S.A. / Key word(s): 9 Month figures/Interim Report
Corestate sees weak business performance in the first nine months of 2022 – goodwill impairments and one-off effects negatively impact adjusted net profit
15.11.2022 / 07:30 CET/CEST
The issuer is solely responsible for the content of this announcement.

Corestate sees weak business performance in the first nine months of 2022 – goodwill impairments and one-off effects negatively impact adjusted net profit

  • Group revenues of around € 50m substantially below previous year due to slump in debt business

  • EBITDA of € -108m and adjusted net profit of € -137m heavily burdened by one-off effects

  • Programme to increase efficiency and reduce costs to continue

  • Bond restructuring enter final phase

Luxembourg, 15 November 2022 – The Corestate Capital Group (Corestate) has published its results for the first nine months of 2022. In its core business, real estate equity and real estate debt, assets under management amounted to € 17.3bn as at 30 September 2022 (2021: € 20.0bn). On the income side, aggregated revenues and gains from continuing operations in the reporting period 2022 were down and stood at € 49.7m (previous year: € 156.7m). The noticeable decline in macroeconomic conditions in combination with interest rate and inflation trends has led to a substantial slump in transaction volume in the real estate sector since early this year. As a result, the Group and especially the Real Estate Debt segment has seen a sharp fall in revenue from structuring and financial advisory services. In addition, the restructuring process of the Stratos funds has meant the end of income from performance fees, pushing aggregated revenues and gains in the Debt segment down to a low € 20.0m (previous year: € 91.7m). Revenue in the Real Estate Equity segment stood at € 44.0m (previous year: € 59.2m), primarily on account of the near complete loss of transaction-related income compared to the previous year.

In the first nine months of 2022, consolidated EBITDA from continuing operations amounted to € -108.3m, compared to € 53.4m in the previous year. This development was primarily due to one-off expenses for risk provisioning and impairments related to bridge loans, performance fees and real estate projects. At the end of September 2022, the company has written off the entire goodwill of HFS as an expense on account of the perspective business development and the associated earnings expectations going forward. In consideration of all expense items, including impairments and write-downs on goodwill and intangible assets, the Group recorded net income from continuing operations of € -581.9m (previous year: € 4.1m). Net profit from continuing operations, adjusted for one-off effects from write-downs and deferred taxes, currently stands at € -137.4m (previous year: € 25.2m).

In the third quarter, the Management Board systematically continued the measures initiated at the beginning of the year to increase efficiency and reduce costs as well as adjust existing capacities to current business volumes. The declared aim remains achieving a structural transformation of the Group into an efficient and effective investment house with the existing focus on real estate equity and debt business by the end of the year. To this end, operating units will continue to be bundled, duplicate functions and overheads reduced, individual locations closed, and all non-personnel costs and other expenses reviewed.

Beyond the operational and market challenges, securing the Group’s liquidity remains a top priority. At the end of September 2022, the Group’s net financial debt amounted to € 556.4m (2021: € 526.5m), while the Group’s consolidated cash and cash equivalents stood at € 40.1m (2021: € 65.1m). With regard to the two maturing bonds – a € 188m convertible bond (November 2022) and a € 300m bond (April 2023) – the Management Board continued the talks with a group of major bondholders and their advisors as well as several potential equity investors in the third quarter in order to explore a viable alternative refinancing solution. A vote on the necessary amendments to the articles of association is scheduled to be held at an extraordinary general meeting on 22 November 2022. The company has also invited the holders of its two bonds to creditor meetings to be held on 28 November 2022 to decide on the restructuring concepts that have been submitted. The corresponding resolution proposals and documents are available on the company’s website at https://corestate-capital.com/en/nhm/.

The complete interim statement is available here: https://corestate-capital.com/en/aktionaere/publications/

Key Figures (continued operations)

 

 

 

 

9M-2022

 

9M-2021

 

 

 

Aggregated Revenues and Gains

 

€ Mio.

 

49.7

 

156.7

 

 

 

Revenue from Real Estate Equity

 

€ Mio.

 

44.0

 

59.2

 

 

 

Revenue from Real Estate Debt

 

€ Mio.

 

20.0

 

91.7

 

 

 

Income from Other Segments

 

€ Mio.

 

-14.3

 

5.8

 

 

 

 

 

 

 

 

 

 

 

 

 

EBITDA

 

€ Mio.

 

-108.3

 

53.4

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Profit

 

€ Mio.

 

-581.9

 

4.1

 

 

 

Adjusted Net Profit1

 

€ Mio.

 

-137.4

 

25.2

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per Share

 

 

-17.02

 

0.14

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

30.09.2022

 

31.12.2021

 

 

 

Book Value Equity per Share

 

 

1.22

 

18.31

 

 

 

Total Equity

 

€ Mio.

 

42.6

 

626.2

 

 

 

Number of Shares outstanding

 

Mio.

 

34.2

 

34.2

 

 

 

Equity Ratio

 

%

 

5.6

 

44.3

 

 

 

Cash and Cash Equivalents

 

€ Mio.

 

40.1

 

65.1

 

 

 

Net Debt

 

€ Mio.

 

556.4

 

526.5

 

 

 

Financial Leverage (Net Debt / EBITDA)

 

 

 

-

 

12.0x

 

 

 

Total Assets under Management

 

€ Mrd.

 

17.3

 

20.0

 

 

 

Number of Employees

 

FTE

 

446

 

811

 

 

 

 
1  Adjusted for one-off effects net of deferred taxes, incl. M&A charges (in FY 2021), depreciation and impairments on
   purchase price allocation (PPA) items

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Press and Investor Relations Contact
Thomas Fritsche
T: +49 69 3535630-106 / M: +49 162 1036025
ir@corestate-capital.com

 

About Corestate Capital Holding S.A. (Corestate)

Corestate is an investment manager and co-investor with € 17.3 billion in assets under management in the core business. The company sees itself as a manager for the entire length of the real estate value chain. Thanks to its fully integrated real estate platform, it is able to offer investors a wide range of services, especially the opportunity to invest in large-scale societal trends such as urbanization, demographic shifts or sustainability – trends that will continue to have a decisive influence on the living and working environment in the long term. The consistent focus on asset classes that will be successful in the long run constitutes a central cornerstone of the company strategy. At Corestate, all concepts are supported with ESG expertise that is unique to the industry. With more than 400 experts, Corestate offers clients and investors a full range of services and consultation from a single source, from project financing and real estate management to sales. Corestate is listed on the Frankfurt Stock Exchange and operates as a respected business partner for institutional and semi-institutional investors as well as high-net-worth private investors in 11 countries across Europe, with offices in Luxembourg, Frankfurt, Munich, Zurich, Paris and Madrid. Please visit www.corestate-capital.com for further information.

Forward-looking statement

This press release may contain certain forward-looking statements based on current assumptions and forecasts made by our management. Various known and unknown risks, uncertainties and other factors could lead to material differences between the actual future results, financial position, development or performance of the Company and the estimates given here. These factors include those described in published reports. These reports are available on our website www.corestate-capital.com. The Company assumes no obligation whatsoever to update these forward-looking statements or to conform them to future events or developments. No inappropriate significance should be attached to forward-looking statements, which apply only to the date of this communication.


15.11.2022 CET/CEST Dissemination of a Corporate News, transmitted by EQS News - a service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.

The EQS Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases.
Archive at www.eqs-news.com

Language:

English

Company:

Corestate Capital Holding S.A.

4 Rue Jean Monnet

2180 Luxembourg

Luxemburg

Phone:

+49 69 3535630-107

Fax:

+49 69 3535630-299

E-mail:

IR@corestate-capital.com

Internet:

www.corestate-capital.com

ISIN:

LU1296758029

WKN:

A141J3

Listed:

Regulated Market in Frankfurt (Prime Standard); Regulated Unofficial Market in Berlin, Dusseldorf, Munich, Stuttgart, Tradegate Exchange

EQS News ID:

1487545


 

End of News

EQS News Service

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