DGAP-News: InCity Immobilien AG / Key word(s): Half Year Results
INCITY'S SEMI-ANNUAL RESULT IS CLEARLY POSITIVE - FORECAST FOR ENTRE YEAR 2020 IS CONFIRMED
Frankfurt am Main, 17 September 2020. In its semi-annual financial statements for 2020 published today, InCity Immobilien AG reports a net profit of EUR 3,635 k at Group level and of EUR 4,545 k at single-entity annual financial statement level. This means that the results significantly exceed the level of the first half of 2019 (semi-annual results for 2019 Group: EUR -870 k, single-entity: EUR 39 k). This positive development is mainly due to the earnings contribution from the sale of the property company holding the portfolio property at "Brönnerstrasse 13/15" in Frankfurt am Main in the amount of EUR 4.4 m (at Group level), but is also characterised by increasing income thanks to the active asset management for the Group's eight portfolio properties. "We confirm the earnings forecast made on 30 March 2020 and continue to expect net income between EUR 4.1 m and EUR 4.6 m at single-entity annual financial statement level and net income between EUR 1.8 m and EUR 2.3 m at Group level," says CFO Helge H. Hehl.
As of 30 June 2020, the InCity Group's portfolio included six residential and commercial buildings and two office properties in Berlin and Frankfurt am Main with an HGB carrying amount of approximately EUR 161 m. On 3 January 2020, the change of ownership and transfer of risks and rewards took place for the medical centre located at "Brönnerstrasse 13/15" in Frankfurt am Main, which had been sold in November 2019. This sale as part of a share deal resulted in an earnings contribution (before taxes, including sales and other costs) of approximately EUR 4.4 m at Group level.
The focus of InCity AG's activities in the first half of 2020 was on the further implementation of the rentals and renovation measures initiated in the previous years. The letting situation is very good in all portfolio properties: with the exception of the three flats each at Leipziger Platz and Werftstrasse 3, which are currently being renovated, there are no significant vacancies. The predominant topic in the first half of 2020 was the COVID-19 pandemic. Despite the Act to Mitigate the Consequences of the COVID-19 Pandemic under Civil, Insolvency and Criminal Procedure Law (COVFAbG), which came into force on 1 April 2020, the rate of payment of all the existing tenants in InCity's properties was between 95.3% and 98.1% in the months April to June. This very good rate of payment confirms the value stability and crisis resilience of the property portfolio. However, the effects of a second wave of infection and/or another lockdown are impossible to assess.
The Group's EBITDA rose by EUR 4,799 k to EUR 5,689 k (same period of the prior year: EUR 890 k), mainly influenced by the sale of the portfolio property located at "Brönnerstrasse 13/15". A further earnings driver in the reporting period was the operating surplus from the property portfolio. This applies in particular to the property located at "Jägerstrasse 54/55" in Berlin-Mitte after completion of and ending the vacancy in the commercial areas in the second half of 2019, as well as to the property located at "Leipziger Platz 8" in Berlin-Mitte which generated rental income for six months compared to three months in the same period of the prior year.
The result at single-entity annual financial statement level is also due to the earnings contribution from the sale of the property company holding the portfolio property at "Brönnerstrasse 13/15", which amounted to around EUR 4.6 m (before taxes, including sales and other costs). InCity Immobilien AG's equity ratio is around 81% as of the cut-off date, which roughly corresponds to the ratio of 31 December 2019 (80%).
The earnings forecast for the Group for 2020 as a whole of between EUR 1.8 m and EUR 2.3 m includes around EUR 1.9 m in scheduled depreciation and amortisation resulting from HGB accounting at amortised cost, which has a negative effect on the result. It should still be noted that the HGB result does not reflect the positive performance of the portfolio. As in previous years, the Company subjected the portfolio properties to a market valuation by BNP Paribas Real Estate Consult GmbH as an external third party; this time with a cut-off date on 31 December 2019. Based on the market valuation of the eight portfolio properties owned as of 30 June 2020 amounting to approximately EUR 212.8 m and taking into account recorded and capitalised renovation investments of approximately EUR 0.4 m (Capex) as well as the other Group balance sheet items, a net asset value (NAV) of EUR 1.62 per share results as of 30 June 2020. Therefore, the InCity shares continue to be valued with a significant NAV deduction.
"Despite the sale of the property located at "Brönnerstrasse 13/15" in Frankfurt am Main, our activities are still focused on expanding the property portfolio of InCity AG," says Michael Freund, CEO of InCity AG, "even though a slowdown in purchases is to be expected in the coming years due to the continuing shortage of properties for sale on the real estate market in conjunction with our strict purchase criteria. We are currently also examining opportunities in the area of project developments and aim to invest more heavily in this area in future."
About InCity Immobilien AG
As a multi-disciplinary real estate company, InCity Immobilien AG (referred to in the following as InCity AG) is dedicated to creating and increasing the value of real estate and operates in the fields of asset management and project development. For its property portfolio, InCity AG focuses on the real estate markets of the two major cities Berlin and Frankfurt am Main and pursues a sustainable investment strategy. The decisive factors here are location, property quality and long-term value stability. Accordingly, the portfolio consists of high quality core properties with value stability in Berlin as well as properties in locations in Frankfurt that are attractive in the long term which range in value between EUR 5 m and EUR 50 m. In addition, InCity AG assumes comprehensive and individually developed asset management contracts for third parties that are adjusted to meet the needs of the respective property or portfolio.
17.09.2020 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG.
InCity Immobilien AG
60325 Frankfurt am Main
IR: +49 (0)69 7191889 55 PR: +49 (0)69 7191889 66
+49 (0) 69 719 18 89 790
Regulated Unofficial Market in Berlin, Dusseldorf, Frankfurt (Basic Board), Hamburg, Stuttgart, Tradegate Exchange
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