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ADLER Real Estate AG: ADLER Real Estate AG improves operating result significantly

ADLER Real Estate AG / Key word(s): Quarter Results

2015-05-18 / 10:38

Corporate News

ADLER Real Estate AG improves operating result significantly

- Funds from operations (FFO I) up by approximately EUR 5 million in first quarter of 2015

- Positive development in loan-to-value (LTV)

- Gross rental income increases to EUR 40.2 million (Q1 2014: EUR 12.1 million)

- EBITDA in accordance with IFRS improves to EUR 55.1 million (Q1 2014: EUR 28.4 million)

Hamburg, 18 May 2015. ADLER Real Estate AG (ISIN: DE0005008007 / WKN: 500800), Frankfurt am Main, reported a significant increase in operating earnings from its expanded residential property portfolio. In the first quarter of 2015, funds from operations (FFO I) from the property portfolio increased by EUR 5 million to EUR 3.784 million (Q1 2014: EUR -1.393 million). A turnaround was also recorded for operating earnings in the Trading segment. During the first quarter of 2015, the corresponding FFO II rose to EUR 3.04 million (Q1 2014: EUR -1.404 million) as per ADLER's interim report for the first quarter of 2015. Improvements were also recorded in regards to the Capital Structure as at the end of March 2015, the ratio of net financial liabilities to investment properties (loan-to-value) decreased to 69.14% compared with 71.17% as at the end of 2014. When including convertible bonds issued by ADLER, the ratio further improved to 67.1% (68.72%) excluding convertible bonds.

"Following the strong expansion of the property portfolio, we are now reaping the anticipated increased earnings from management and letting," states Axel Harloff, Management Board member of ADLER Real Estate. "This does not yet fully include the effect of the acquisition of an important residential property portfolio comprising around 6,750 units in Wilhelmshaven. This is because the portfolio was not acquired until the end of January." As at the end of March 2015, ADLER held a residential portfolio comprising 30,840 units, which was more than triple the figure as at the end of March 2014 (10,142 units). "If we project the development in the first quarter, we expect to generate FFO I of between EUR 15 million and EUR 20 million for 2015 as a whole," continues Harloff. "The effects from the pending acquisition of WESTGRUND, which is set to be closed towards the middle of the year, are not yet included in this projection."

The Company's Trading arm, which is represented primarily by the subsidiary ACCENTRO Real Estate AG, also developed positively. Following an upturn in earnings in the first quarter, this segment anticipates a result in the double-digit million range in the second quarter of 2015. The significant earnings improvement in the first quarter including effects from acquisitions saw the ADLER Group double its consolidated net profit from EUR 21.4 million to EUR 42.9 million. EBITDA in accordance with IFRS also improved strongly to EUR 55.1 million (Q1 2014: EUR 28.4 million). According to the new final figures, in the first quarter of 2015 gross rental income in the ADLER Group rose to EUR 40.2 million compared with EUR 12.1 million in the same period of the previous year. Total assets of the ADLER Group increased in the first quarter to EUR 1.687 billion (end of 2014: EUR 1.416 billion).

"We are working intensively on integrating the numerous acquired portfolios and also on further improving income from management and letting," declares Harloff. The occupancy rate moved up slightly as early as in the first quarter to 88.13% compared with 87.3% at the end of 2014. As at the end of March, average monthly in-place rent was EUR 4.92 per square metre of floor space. "Due to the strong growth rate, the new financial year and thus also the first quarter are not comparable with previous periods. But with the size we have achieved we now have a reference year, with which future reporting periods and results can be compared," states Harloff. In view of the occupancy rate and the average rent, ADLER believes that the existing portfolio harbours significant potential for improving results of operation further. "Every percentage point more in terms of utilisation and every cent more of average rent feeds seamlessly through to our income," says Harloff.

For enquiries, please contact:

PRESS: german communications dbk ag
Jörg Bretschneider
Milchstr. 6 B, 20148 Hamburg
Tel.: 040/46 88 33 0, Fax: 040/47 81 80

INVESTOR RELATIONS: Hillermann Consulting
Christian Hillermann
Poststraße 14, 20354 Hamburg
Tel.: 040/32 02 79 10, Fax: 040/32 02 79 114


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