Corporate News

13/05/2015 | Corporate News

Fair Value REIT-AG records a substantial rise in consolidated net income and net asset value


·         IFRS Group net profit of EUR 2.9 million in Q1 2015 (previous year: EUR 1.2 million)

·         Net asset value per share rises to EUR 8.71 as of 31 March 2015 (31 December 2014:

          EUR 8.39)

·         FFO at EUR 1.0 million in Q1 2015 (previous year: EUR 1.3 million)

·         REIT equity ratio increases to 51.3% (31 December 2014: 49.2%)

·         Capital increase successfully placed on the back of high demand


Munich, 13 May 2015 – Fair Value REIT-AG (WKN A0MW97) has made a successful start to the financial year 2015 and has substantially increased IFRS consolidated net income in the first quarter. During the reporting period, the framework was also created for the company to make rapid progress on the growth strategy adopted at the end of last year.


The rental income of the Group for the first three months of 2015 amounted to EUR 5.6 million and, after property sales, was down on the corresponding previous year figure of EUR 6.2 million by EUR 0.6 million or 10% as expected. Due to higher non recoverable property operating expenses, net rental income came in at EUR 3.9 million, which was EUR 0.9 million or 18% lower than in the corresponding quarter of the previous year (EUR 4.8 million).


Almost half of the funds from the convertible bond issued in January 2015 totalling around EUR 8.5 million were already invested in participations at subsidiaries in the first quarter 2015. The newly acquired assets generated an IFRS profit contribution of around EUR 1.9 million for the shareholders of Fair Value REIT-AG on their initial recognition. This corresponds with around 46% of the total investments made.


The substantially reduced interest expenses compared to the previous year period also had a positive impact, coming in at EUR 1.1 million, some 22% down on the previous year figure.


In the first quarter 2015, Fair Value REIT-AG therefore achieved IFRS Group net profit of EUR 2.9 million, which is around EUR 1.7 million higher than the previous year figure of EUR 1.2 million.


Group net profit adjusted for valuation effects (FFO – funds from operations) came in at EUR 1.0 million and was in line with the company’s planning for the first quarter of the current financial year. The decrease compared to the previous year figure of EUR 1.3 million largely resulted from the sales of non-strategic real estate made in the interim.


On the reporting date, Group equity was recorded at EUR 81.2 million after EUR 78.3 million as of 31 December 2014. As a result, the balance sheet net asset value increased by 4% from EUR 8.39 to EUR 8.71 per share in circulation on that date. The REIT equity ratio also rose by 4% from 49.2% of immovable assets at the end of the previous year to 51.3% on 31 March 2015.


At the start of May 2015, Fair Value REIT-AG made the most of the capital market environment and successfully carried out a cash capital increase with subscription rights for existing shareholders by completely utilising authorised capital 2014 with a view to financing its further growth plans.


At a price of EUR 7.90 per new share, around EUR 37 million gross was generated by the capital increase. With a subscription ratio of 42%, the capital increase was subject to great demand among existing shareholders. Meanwhile, 58% of the volume was placed with new shareholders from Germany and other European countries, further diversifying the shareholder base.


Frank Schaich, CEO of Fair Value REIT-AG, commented on business development in the first quarter and the capital increase: “The results of the first quarter 2015 confirm our planning; they therefore represent a solid starting point for further positive business development in 2015 and for implementing our growth strategy. We view the successful capital increase and the strong demand for newly issued shares in our company as a sign of the confidence in our business and our future plans. Investors are particularly attracted to our focus on retail and office real estate at secondary locations in Germany.”


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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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Fair Value REIT-AG