Corporate News

31/03/2009 | Corporate News

Fair Value REIT-AG announces final figures for 2008

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  • Consolidated earnings before extraordinary factors of € 5.2 million
  • Market valuation of real estate and additional extraordinary factors lead to consolidated net loss of € 13.3 million
  • Equity within the meaning of Section 15 of the REIT-G totals 52%
  • Net asset value (NAV) of € 8.16 per share
  • Consolidated cash and cash equivalents increased to € 14 million
  • Annual report 2008 available at www.fvreit.de as of today


Munich, March 31, 2009 – Fair Value REIT-AG published its annual report for fiscal year 2008 today. Fair Value REIT-AG’s stable existing business meant that it was able to successfully meet the challenges posed by the current market environment and it surpassed its economic targets from its ongoing business with consolidated earnings before extraordinary factors of € 5.2 million. However, the market valuation of its real estate and other extraordinary factors, including losses from interest rate hedges and gains from the sale of investment properties totaled a negative € 18.5 million. This resulted in a consolidated net loss of € 13.3 million. This corresponds to earnings per share of € -1.41. The German GAAP (HGB) earnings, which are relevant for the dividend disbursement, were balanced after the formation of a reinvestment reserve within the meaning of Section 13 of the REIT-G. As a result, the company will not pay a dividend for fiscal year 2008.

Including charges from the valuation of interest rate derivatives in the amount of € 4.6 million, consolidated equity fell to € 76.8 million. This corresponds to a net asset value (NAV) of € 8.16 per share in circulation, compared to € 10.06 in the previous year. Consolidated total assets fell from € 230 million in the previous year to € 198 million. Fair Value REIT-AG had an equity ratio within the meaning of Section 15 of the REIT-G of 52% of immoveable assets on December 31, 2008. As a result, the Fair Value Group has solid equity despite the valuation-related consolidated loss.

The group’s cash and cash equivalents enjoyed positive growth: in total, the net cash provided by operating activities totaled € 21.5 million. This was coupled with net cash provided by investment activities of € 3.6 million. These cash flows were used to repay liabilities in the amount of € 16.4 million, and also increased the Fair Value Group’s cash and cash equivalents by € 8.7 million year-on-year to € 14 million.

Frank Schaich, Fair Value REIT-AG’s CEO, believes that the company is well positioned in view of the high occupancy rates of 95% of potential rent for the proportionate total portfolio due to Fair Value: “The crisis on the financial and capital markets has not left us unscathed with regard to the valuations of our properties, however we are looking to our ongoing business this year with confidence. Just 7% of our rental volume is due to be extended or newly let in 2009.” In addition, the CEO believes the company’s financial stability offers advantages given the current situation on the market: “Fair Value’s equity ratio and liquidity are high. In addition, we only have to extend borrowing of € 13.5 million or 14% of the group’s financial liabilities. That means that our financing structure is very solid.” The Managing Board is forecasting consolidated earnings (IFRS) in a bandwidth of between € 2.7 million to € 3.0 million in 2009 if business is in line with forecast. This already includes the anticipated valuation losses from overrents. It does not include any other changes in the market value of the real estate and interest rate derivatives.

The full 2008 annual report is available online at www.fvreit.de in the Investor Relations section.

 

 

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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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