alstria office REIT-AG: First half 2019 - Strong operations and results on plan
Press release First half 2019 - Strong operations and results on plan- Letting volume more than doubled to 148,500 qm - EPRA NAV per share up by 6.9% to EUR 16.19 - Net LTV at 29.0% and REIT equity ratio at 69.2% - Revenues at EUR 93.1 m and funds from operations (FFO) at EUR 55.7 m - Guidance 2019 confirmed with revenues of EUR 190 m and FFO of EUR 112 m
Hamburg, August 12, 2019 - alstria office REIT-AG (symbol: AOX, ISIN: DE000A0LD2U1) reports on a successful first half of 2019. The Company took advantage of strong letting markets, with record leasing results, bringing the EPRA vacancy rate down to 7.6%. alstria continued to improve the overall risk return profile of the portfolio, diligently selling non-core peripheral assets and selectively re-investing in its core markets.
Revenues of EUR 93.1 m and FFO of EUR 55.7 m
Total revenues for the first half of 2019 were EUR 93.1 million (-3.2%) and developed in line with expectations. The change in revenues was mainly the result of the sale of non-core assets at the periphery of the portfolio, as the Company uses the positive momentum in the investment market to further improve the overall risk return profile of its real estate portfolio.
Funds from Operations (FFO) for the same period were EUR 55.7 million (-4.1%) and were in line with the Company's plan. The FFO margin of 59.8% (H1 2018: 60.3%) remained at a high level and reflected alstria's profitability. Consolidated net income as of June 30, 2019 rose significantly by 346.2% to EUR 279.0 million compared to EUR 62.5 million in the same period of the previous year. The change is attributable to a revaluation result of EUR 199.4 million
Net LTV at 29.0%, EPRA NAV per share at EUR 16.19
In the first six months of 2019, alstria's IFRS equity grew by 7.0% to EUR 2,872 million. The dividend payment of EUR 92.3 million (EUR 0.52 per share) to the shareholders of the Company in the second quarter of 2019 was substantially overcompensated by the net profit contribution in the first six months of the year. alstria's EPRA NAV per share is up by 6.9% and stood at EUR 16.19 per share as per June 30, 2019. The strength of alstria's balance sheet is demonstrated by a G-REIT equity ratio of 69.2% and the Company's net LTV of 29.0%, which hit a new all-time low in alstria's corporate history. Net debt to EBITDA remained at a comfortable 8.5x multiple.
Letting volume of 148,500 qm - EPRA vacancy rate dropped by 210 bps
Following the signature of several leasing contracts, alstria's EPRA vacancy rate dropped by 210 bps to 7.6% as per June 30, 2019 (9.7% as per Dec. 31, 2018). Sizable leasing contracts were signed for the assets "Am Seestern 1" and "Heerdter Lohweg 35" in Düsseldorf as well as "Rotebühlstr. 98-100" in Stuttgart. alstria's overall letting performance reached a record high of 148,500 m2 (81,800 m2 of new leases and 66,700 m2 of lease extensions) and was spread across all of alstria's markets. Only includes new leases signed and disregards any lease renewals.
Portfolio value increased to EUR 4.2 bn
On the basis of a half-year valuation, the value of alstria's real estate portfolio amounted to EUR 4.2 billion as per June 30, 2019 (EUR 4.0 bn as per Dec. 31, 2018). The revaluation gain of EUR 199.4 million primarily reflected alstria's real estate operations, which increased the like-for-like contractual rent by 4.9% (EUR 9.3 million) in the course of the first six month of 2019. The valuation yield (contractual rent/open market value) compressed by 10 bps moving to 4.8% (from 4.9% as per Dec. 31, 2018). The average capital value per qm amounted to EUR 2,721.
As of the reporting date, alstria owned 116 properties (average size: 13,150 qm, average value: EUR 35,780 million) located in Germany's major office markets.
Selling the periphery
In the first half of 2019, alstria continued to execute on its plan to capitalize on the strong investment market to improve the overall quality of the portfolio. As such, the Company sold three assets, located at the fringe of its markets, for a total consideration of EUR 107.4 million (annual in-place rent: EUR 5.9 million) and realized a gain of EUR 18.1 million. In parallel, alstria continued to strengthen its portfolio with the acquisition of three additional assets located in Berlin and Düsseldorf, offering substantial rental reversion for a total amount of EUR 30.1 million (EUR 3,053 per qm, annual rent of EUR 1.1 m, ERV of EUR 1.8 m).
Confirmation of guidance for FY 2019
Based on the results of the first half, alstria confirms its guidance for FY 2019: revenues of around EUR 190 million and FFO of EUR 112 million.
"So far we had a record year in terms of leasing result and still benefit from a very strong pipeline, which we will be working on securing in the months to come", said Olivier Elamine, CEO of alstria. "This strong operative result has been a substantial driver in the value increase of the portfolio, which was further underpinned by a strong investment market."
Key financials at a glance
H1 2019 H1 2018 Change Revenues (EUR m) 93.1 96.2 -3.2% Funds from operations (FFO) (EUR m) 55.7 58.1 -4.1% FFO per share (EUR) 0.31 0.33 -4.2% Jun. 30, 2019 Dec. 31, 2018 Change Investment properties (EUR m) 4,135 3,939 5.0% Cash at hand (EUR m) 107.2 132.9 -19.3% EPRA NAV per share (EUR) 16.19 15.14 6.9% G-REIT equity ratio (%) 69.2 67.2 2.0 pp Net LTV ratio (%) 29.0 30.4 -1.4 pp  FFO per share based on 177.5 m shares for H1 2019 and 177.4 m shares for H1 2018.
Invitation to the conference call on August 13, 2019 The alstria management board, CEO Olivier Elamine and CFO Alexander Dexne, will present the H1 results during a conference call at 10:00 am (CET).
Please use one of the following dial-in numbers: Germany: + 49 69 201 744 220 UK: + 44 20 300 92 470 PIN: 957 908 69# Please note that you can watch the management's presentation live as a webcast on our website www.alstria.com. As soon as the conference call begins, the presentation slides will be available for download on our website.
Contact IR/PR: Ralf Dibbern Steinstr. 7 20095 Hamburg, Germany Tel: +49 (0) 40 226 341 329 Email: firstname.lastname@example.orgMore information on: www.alstria.comwww.beehive.workwww.twitter.com/alstria_REITAbout alstria: alstria office REIT AG is the leading real-estate operator focusing solely on German office property in selected German markets. Our strategy is based on the ownership and an active management of our properties throughout their entire life cycle, strong added-value services to our customers and deep knowledge of the markets in which we operate. alstria strives for sustainable long-term value creation while taking advantage of short-term arbitrage of inefficiencies in the real estate markets. The portfolio comprises 116 buildings with a lettable area of 1.5 million square meters and a total portfolio value of EUR 4.2 billion.Disclaimer: This release constitutes neither an offer to sell nor a solicitation of an offer to buy any shares. As far as this press release contains forward-looking statements with respect to the business, financial condition and results of operations of alstria office REIT-AG (alstria), these statements are based on current expectations or beliefs of alstria's management. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results or performance of the Company to differ materially from those reflected in such forward-looking statements. Apart from other factors not mentioned here, differences could occur as a result of changes in the overall economic situation and the competitive environment - especially in the core business segments and markets of alstria. Also, the development of the financial markets and changes in national as well as international provisions particularly in the field of tax legislation and financial reporting standards could have an effect. Terrorist attacks and their consequences could increase the likelihood and the extent of differences. alstria undertakes no obligation to publicly release any revisions or updates to these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.
12.08.2019 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG.The issuer is solely responsible for the content of this announcement.The DGAP Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Archive at www.dgap.deLanguage: English Company: alstria office REIT-AG Steinstraße 7 20095 Hamburg
Germany Phone: 040-226 341 300 Fax: 040-226 341 310 E-mail: email@example.com Internet: http://www.alstria.de ISIN: DE000A0LD2U1 WKN: A0LD2U Indices: MDAX, EPRA, German REIT Index Listed: Regulated Market in Frankfurt (Prime Standard); Regulated Unofficial Market in Berlin, Dusseldorf, Hamburg, Hanover, Munich, Stuttgart, Tradegate Exchange; London, Luxembourg Stock Exchange, SIX, Vienna Stock Exchange EQS News ID: 855835 End of News DGAP News Service