VIB Vermögen further increases property portfolio and profitability in the first half of 2018

Corporate news

VIB Vermögen further increases property portfolio and profitability in the first half of 2018

– Revenue rise of 3.5 per cent to EUR 42.6 million thanks to portfolio expansion

– Further increase in profitability, with sharp climb of 8.3 per cent in adjusted EBT

– Outlook for the 2018 financial year confirmed
 

Neuburg/Danube, August 8, 2018 – VIB Vermögen AG, a company specialising in the development, acquisition and management of commercial properties, has closed the first half of 2018 with significant increases in revenue and earnings. This trend was driven by the letting of new properties arising from development projects, as well as the ongoing decline in interest expenses on existing borrowings. As a result, FFO (an indicator used in the property sector) and adjusted EBT rose more sharply than revenue.

Following new additions to the portfolio and rent adjustments due to indexing, revenue rose by 3.5 per cent year-on-year to EUR 42.6 million (previous year: EUR 41.1 million). When adjusted for valuation effects and extraordinary items, EBT came in at EUR 25.0 million (previous year: EUR 23.0 million), which represents a considerable increase of 8.3 per cent. Consolidated net income rose by 5.0 per cent to EUR 22.9 million in the first half of the year (previous year: EUR 21.8 million).

“The first half of 2018 was extremely pleasing for VIB Vermögen. With the new additions to our portfolio, we are benefiting from our strategy of making good use of in-house developments in the current market environment. At the same time, our long-term financing strategy, which continues to result in lower interest expenses, is paying off in terms of our borrowings,” explains Holger Pilgenröther, Chief Financial Officer of VIB Vermögen AG.
 

An attractive and profitable property portfolio
As of June 30, 2018, the VIB Vermögen property portfolio comprised 105 properties with rentable space of approximately 1.07 million square metres. The FFO (funds from operations) generated from it, which serves as an indicator of the company’s cash inflow from operating activities, climbed by 9.1 per cent to EUR 21.8 million euros in the first half of 2018 (previous year: EUR 20.0 million). FFO per share improved accordingly from EUR 0.72 to EUR 0.79. By virtue of the pleasing course of business, the undiluted net asset value (NAV) of the company climbed to EUR 536.5 million as of June 30, 2018 (December 31, 2017: EUR 512.5 million). Taking the total number of shares, undiluted NAV per share increased by 4.7 per cent from EUR 18.58 to EUR 19.45. The vacancy rate remains unchanged at its low level of 0.8 per cent.

At VIB Vermögen, three new developments, as well as a redensification development on an existing site, are currently under construction. All four projects are in-house developments and will add some 57,000 square metres of rental space to the portfolio. Two of the new developments have been fully let prior to completion and will be handed over to their tenants in the next few weeks. One third of the remaining new development has already been let, and construction is scheduled for completion in the fourth quarter of 2018. The redensification project is being completed on an existing site in the Regensburg area and comprises the construction of two office complexes. Completion is scheduled for the fourth quarter of 2019.

In addition, the burgeoning site pipeline of VIB Vermögen totals some 170,000 square metres for potential new development projects. Whilst property acquisitions are also conceivable, these depend on the further development of prices.

“The market for logistics properties remains extremely attractive. In this regard, southern Germany represents an outstanding location in the heart of Europe. With in-house developments on new sites and the redensification of existing sites, we are able to tap into considerable potential when it comes to further optimising our portfolio with attractive properties in the future. This also reduces our exposure to the high purchase prices of existing properties,” emphasises Martin Pfandzelter, Chief Executive Officer of VIB Vermögen AG.

On the basis of the results to date and the planned course of business, VIB Vermögen confirms its guidance for the 2018 financial year as a whole made in the 2017 Annual Report.

The full 2018 Half-Year Report can be accessed at www.vib-ag.de.

Contact

Investor Relations:

VIB Vermögen AG
Petra Riechert Tel.: +49 (0)8431 9077 952
Tilly-Park 1 Fax: +49 (0)8431 9077 929
86633 Neuburg/Donau Email: ed.ga-biv@trehceir.artep

Profile of VIB Vermögen AG (including BBI Immobilien AG)

VIB Vermögen AG is a medium-sized company specialising in commercial real estate management that has been operating successfully for more than 20 years. The company focuses on properties from the logistics/light industry and retail sectors in the economically strong southern German region. VIB’s shares have been listed on the Munich (m:access) and Frankfurt (Open Market) stock exchanges since 2005.

VIB’s business model is based on a “develop-or-buy-and-hold” strategy. Firstly, VIB acquires properties that are already rented. Secondly, it completely develops new properties in order to transfer them to its own portfolio on a long-term basis and generate rental income from them. VIB also holds investments in companies with real estate assets.