Corporate News

28/02/2012 | Corporate News

Fair Value REIT-AG achieves substantial growth in earnings in 2011 according to preliminary figures and pays out dividend

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  • Consolidated net income up € 2.4 million to € 4.6 million (previous year: € 2.2 million) 
  • Funds from operations (FFO) total € 5.6 million as anticipated (previous year: € 5.8 million)
  • REIT equity ratio increases to 50.8% (previous year: 49.4%)
  • Dividend of € 0.08 per share planned for 2011

 

Munich, February 27, 2012 – According to preliminary figures, Fair Value REIT-AG achieved net sales of € 13.3 million for the financial year 2011 in line with its planning (previous year: € 14.4 million). Net rental income for the Group therefore came in at € 8.7 million (previous year: € 9.5 million). 

 

The operating result (EBIT) rose by around € 3.8 million to € 6.7 million and was therefore substantially up on the previous year figure of € 2.9 million. This rise in earnings was primarily due to the considerably improved valuation result year-on-year as part of the market valuation of the Group’s real estate portfolio.

 

In contrast, income from participations at associated companies totalled € 3.3 million, around € 0.6 million down on the previous year figure of € 3.9 million. This was due to valuation losses of the real estate at these companies following write-downs on some buildings with soon-to-expire lease agreements.

 

The valuation result of the real estate on the balance sheet date produced a net growth in value of 2.6% for direct ownership, a growth of 1.1% at subsidiaries and a proportionate valuation loss of 1.8% at the associated companies. Fair Value’s proportionate valuation result therefore totalled -0.2% (previous year: -2.0%). 

 

During the reporting period, the Company was able to substantially boost its consolidated net income by € 2.4 million to € 4.6 million (previous year: € 2.2 million). Earnings per share were up € 0.26 to € 0.50 per share, compared with € 0.24 per share in the previous year. 

 

Consolidated net income adjusted for changes in market value and other one-off effects (in accordance with EPRA), which is also funds from operations (FFO), totalled € 5.6 million or € 0.60 per share. This was in line with the full-year forecast revised upwards in November 2011. 

 

The slight fall in EPRA earnings (FFO) compared to the previous year figure of € 5.8 million came on the back of the disposal of real estate and individual renewable agreements at lower market rents as well as the premature release from a lease agreement following the receipt of a compensation payment.

 

On the balance sheet date, consolidated equity came in at € 76.8 million (December 31, 2010: € 74.6 million) according to preliminary figures. As a result, the balance sheet net asset value increased from € 8.00 to € 8.24 per share in circulation. Taking into consideration the minority interests in subsidiaries, the equity ratio pursuant to § 15 of the REIT Act rose to 50.8% of immovable assets (December 31, 2010: 49.6%). 

 

Retained earnings reported in the non-consolidated financial statements of Fair Value REIT-AG under the German Commercial Code (HGB) reached € 0.8 million (previous year: € 1.0 million). This was due to income from participations falling short of expectations during the financial year 2011.

 

Frank Schaich, CEO of Fair Value REIT-AG, on the Group’s positive business development and its effect on the HGB non-consolidated financial statements: “The markedly improved valuation result of our real estate compared to the previous year played a substantial role in achieving the pleasing increase in IFRS consolidated net income for 2011. This also had a positive effect on the Company’s non-consolidated financial statements. However, the HGB retained earnings of € 0.8 million will only allow a dividend pay-out of presumably € 0.08 per share for 2011.”

 

The final results for the financial year 2011 will be published by Fair Value REIT-AG on March 29, 2012 in the Financial Reports section of www.fvreit.de.  

 

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A REIT – Higher Return for Investors

REIT stands for Real Estate Investment Trust. The assets of these listed companies in Germany consist mainly of real estate and investments in other real estate companies.

 

At the international level, REITs have been established for many years. On 1 January 2007, they were introduced in Germany as well.

 

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