Tag Immobilien Ag · XETR:TEG
Tag Immobilien — H1 2023 Earnings Presentation
45 slides from Tag Immobilien's earnings presentation, Aug 14, 2023
Slide 1: Company presentation H1 2023
Company presentation H1 2023 TAG Immobilien AG | August 2023| 1
Slide 2: Content
Content I. TAG overview 3 II. TAG German portfolio H1 2023 7 III. TAG Poland portfolio H1 2023 11 IV. TAG financing structure H1 2023 18 V. TAG guidance FY 2023 22 VI. Appendix 24 Highlights H1 2023 Income Statement, income statement details Germany and Poland, EBITDA/FFO/AFFO calculation, balan
Slide 3: TAG overview
TAG overview TAG Immobilien AG | August 2023| 3
Slide 4: TAG markets
TAG markets Two separate country operations with distinct strategic angles TAG Germany TAG Poland Increasing regulation in residential property sector leading to Strongly rising demand for rental apartments as well as flattening curve of rental growth condominiums in major cities Market environm
Slide 5: TAG overview and strategy
TAG overview and strategy Leading German affordable housing player and major Polish development business Strategy for German portfolio TAG is a specialist for affordable housing in Eastern and Northern Germany and among the largest owners of residential properties in Eastern Germany Fully integr
Slide 6: TAG highlights H1 2023: disposals, re-financings and operational performance
TAG highlights H1 2023: disposals, re-financings and operational performance 1 1,051 units (including one commercial building) sold in H1 2023 with total gross sales proceeds of EUR 161.8m and expected net cash proceeds of EUR 143.1; units sold at average gross yield of 4.4% with current vacancy a
Slide 7: TAG German portfolio H1 2023
TAG German portfolio H1 2023 TAG Immobilien AG | August 2023| 7
Slide 8: TAG German portfolio rental growth and capex allocation
TAG German portfolio rental growth and capex allocation Rental growth achieved with moderate capex investments due to strong underlying fundamentals Rental growth achieved with moderate investments Maintenance & capex development (in EUR/sqm/year) 21.6 20.9 24.6 22.7 TAG creates attractive rental
Slide 9: TAG German portfolio vacancy reduction residential units
TAG German portfolio vacancy reduction residential units Strong track record of recurring vacancy reduction after acquisitions leads to significant value creation Acquisitions Acquisitions +0.1% +0.8% 5.9% 5.8% 5.7% 5.7% Acquisitions Acquisitions 5.4% 5.5%* +0.1% 5.3%* 5.2% +0.1% 5.1% 4.8% 4.8% 4.7%
Slide 10: TAG portfolio valuation overview Germany
TAG portfolio valuation overview Germany Portfolio valuation result Development of gross yield 5.9% 5.9% H1 2023 vs. H1 2022 H1 2023 H1 2022 5.7% 5.5% 5.4% 5.3% -471.2 256.5** 5.1% in EUR m semi-annual valuation result (w/o capex) -7.4% +4.0% thereof from yield compression/ expansion -8.3% +3.4%
Slide 11: TAG Poland portfolio H1 2023
TAG Poland portfolio H1 2023 TAG Immobilien AG | August 2023| 11
Slide 12: TAG Poland portfolio overview
TAG Poland portfolio overview Establish Polish build-to-sell and build-to-hold platform, based on the fully integrated Vantage and ROBYG businesses Portfolio strategy and geographic breakdown Key portfolio metrics 30 Jun-2023 Building a portfolio of residential properties via own project developme
Slide 13: TAG Poland build-to-hold portfolio mid-term development
TAG Poland build-to-hold portfolio mid-term development Overview of the planned development for the build-to-hold pipeline Overview of the Polish build-to-hold portfolio Potential scenarios for the build-to-hold portfolio Scenario 1: Scenario 2: Growth only by using Additional growth via surplus cas
Slide 14: TAG Rental portfolio Poland
TAG Rental portfolio Poland Continious strong rental results and a growing portfolio Rentable Fair value (IFRS) Units In-place Vacancy Vacancy Net actual rent l-f-l rental growth Region area EURm # yield Jun-2023 Dec-2022 EUR/ sqm/month* y-o-y sqm Jun-2023 Residential units 510 22,126 55.6 5.5% 3.7%
Slide 15: Overview of Polish residential rental market
Overview of Polish residential rental market Strong increase in rent prices throughout major Polish cities +20% Average rental level for new stock EUR/sqm/month) Throughout 2022, there was a high demand for apartments for rent throughout Poland. 19.52 (as of June 2023) 20 +5% A sharp increase in r
Slide 16: TAG Poland portfolio historical performance trajectory
TAG Poland portfolio historical performance trajectory Strategic focus on develop to sell projects drives uptick in disposal volumes, which allows to capitalize on rising sales prices Units sold (#) 35 58 33 239 58 78 339 538 401 2,510 583 280 1,200 3,000 1,000 972 2,500 Disposal price / Constructio
Slide 17: TAG Poland – New joint venture with institutional investor
TAG Poland – New joint venture with institutional investor Description Joint venture structure (simplified) Institutional On 28 April 2023 TAG signed a joint venture agreement with an international institutional investor investor in order to develop a build-to-sell portfolio in Poland The joint
Slide 18: TAG financing structure H1 2023
TAG financing structure H1 2023 TAG Immobilien AG | August 2023| 18
Slide 19: TAG financing structure
TAG financing structure Debt structure as of 30 Jun-2023 Key financial KPIs as of 30 Jun-2023 Debt volume Ø interest rate % fixed rates Ø Maturity total financial 5.0 years debt Ø Maturity bank loans 6.3 years Bank loans EUR 2,351m 2.2% 94% Ø Interest rate total financial 5% 3% debt 2.3% Corporate b
Slide 20: TAG cost of debt and LTV
TAG cost of debt and LTV Cost of debt Ø in % LTV in % 2.3% 2.1% 44.8% 45.1% 46.7% 47.5% 43.2% 1.7% 1.5% 1.4% 2019 2020 2021 2022 30 Jun-2023 31 Dec-2019 31 Dec-2020 31 Dec-2021 31 Dec-2022 30 Jun-2023 TAG Immobilien AG | August 2023| 20
Slide 21: TAG other financing metrics
TAG other financing metrics ICR Net financial debt/ EBITDA adjusted Net financial debt in EUR/ sqm 12.7 651 7.4 11.6 586 6.4 11.3 504 5.2 5.6 10.9 460 479 4.2 10.1 2019 2020 2021 2022 LTM 2023* 2019 2020 2021 2022 LTM 2023* 2019 2020 2021 2022 30 Jun-2023 6.4x reflects the total adjusted EBITDA of t
Slide 22: TAG guidance FY 2023
TAG guidance FY 2023 TAG Immobilien AG | August 2023| 22
Slide 23: TAG FFO and dividend guidance FY 2023 (unchanged)
TAG FFO and dividend guidance FY 2023 (unchanged) FFO I -9% FFO I/s* -18% (EUR) 170-174m 0.98 vs. 2022 (EUR) vs. 2022 FFO II -3% FFO II/s* -11% 240-246m 1.38 (EUR) vs. 2022 (EUR) vs. 2022 depending on market conditions and Dividend completions of refinancings * based on 175,441,591 average NOSH (ous
Slide 24: Appendix
APPENDIX TAG Immobilien AG | August 2023| 24
Slide 25: TAG highlights H1 2023: financial performance and German portfolio
TAG highlights H1 2023: financial performance and German portfolio Q2 2023 Q1 2023 H1 2023 H1 2022 FY 2022 APPENDIX FFO I (EURm) 46.5 42.6 89.1 96.2 189.4 FFO I (EUR/share) 0.27 0.24 0.51 0.66 1.19 FFO II (EURm) 60.5 51.1 111.6 100.6 247.3 Financial performance FFO II (EUR/share) 0.35 0.29 0
Slide 26: TAG highlights H1 2023: Poland
TAG highlights H1 2023: Poland APPENDIX Q2 2023* Q1 2023 H1 2023* H1 2022 FY 2022 Revenues from sale of properties (EURm) 32.2 58.1 90.3 65.8 337.6 Rental revenues (EURm) 2.7 1.5 4.2 1.2 2.7 Operational performance FFO I Poland** (EURm) -0.1 -0.3 -0.4 --- --- Poland Adjusted net income from sales Po
Slide 27: TAG income statement
TAG income statement* APPENDIX (in EURm) Q2 2023 Q1 2023 H1 2023 H1 2022 FY 2022 Slight increase in net actual rent Q-o-Q by EUR 0.8 despite portfolio sales in Germany as a result 1 of ongoing rental growth in Germany and Poland. Net actual rent** 1 87.4 86.6 174.1 169.1 339.9 Expenses from property
Slide 28: TAG income statement details Germany and Poland
TAG income statement details Germany and Poland Poland - Poland – Poland - Poland – Germany Poland Total Germany Poland Total APPENDIX (in EURm) Rental Sales Rental Sales Q2 2023 Q2 2023 Q2 2023 H1 2023 H1 2023 H1 2023 Q2 2023 Q2 2023 H1 2023 H1 2023 Net actual rent* 84.8 2.7 2.7 0.0 87.4 169.9 4.2
Slide 29: TAG EBITDA, FFO and AFFO calculation
TAG EBITDA, FFO and AFFO calculation (in EURm) Q2 2023* Q1 2023 H1 2023* H1 2022 FY 2022* EBIT Germany -408.8 51.0 -357.8 361.3 118.1 EBITDA (adjusted) rental business increases Q-o-Q (EUR 3.8m) mainly as a APPENDIX EBIT Poland rental** 2.1 0.7 2.8 0.0 0.0 1 result of higher net rental income (EUR 3
Slide 30: TAG balance sheet
TAG balance sheet (in EURm) 30 Jun-2023 31 Dec-2022 APPENDIX Non-current assets 6,532.3 6,936.1 Investment property 1 6,128.6 6,569.9 The change in investment properties mainly results from property revaluation (EUR -455.5m), capex 1 in H1 2023 (EUR 40.5m) and investments in Poland (EUR 36.8m). Furt
Slide 31: TAG EPRA NTA calculation
TAG EPRA NTA calculation APPENDIX EPRA Net Tangible Assets EPRA NTA bridge in EUR/share (in EURm) 30 Jun-2023 31 Dec-2022 Equity (without minorities) 2,957.6 3,198.5 -2.50 + Deferred taxes on investment properties and 0.69 554.7 638.6 financial derivatives + Fair value of financial derivatives -3.0
Slide 32: TAG EPRA NAV calculations
TAG EPRA NAV calculations APPENDIX EPRA NRV EPRA NTA EPRA NDV Net reinstatement value Net tangible assets Net disposal value (in EURm) 30 Jun-2023 30 Jun-2023 30 Jun-2023 Equity (before minorities) 2,957.6 2,957.6 2,957.6 Difference between fair value and book value for properties valued at cost 91.
Slide 33: TAG German portfolio details by region
TAG German portfolio details by region Region Units Rentable IFRS BV Gross Vacancy Vacancy Net actual Re-letting l-f-l rental l-f-l rental growth Mainte- Capex APPENDIX # area EURm yield Jun- Dec- rent rent growth Y-o-Y incl. nance EUR/sqm sqm Jun- 2023 2022* EUR/ EUR/ Y-o-Y vacancy EUR/sqm 2023 sqm
Slide 34: TAG German portfolio vacancy reduction and rental growth
TAG German portfolio vacancy reduction and rental growth APPENDIX Vacancy development 6M 2023* l-f-l rental growth (Y-o-Y) 6M 2023 Gera 4.4% 1.8% Gera from 3.9% to 3.1% -0.8% Leipzig 3.0% from 8.0% to 7.9% 2.1% Chemnitz -0.1% Hamburg 2.5% Leipzig from 8.6% to 8.6% +/-0% 2.6% Chemnitz 2.5% Berlin fro
Slide 35: TAG German portfolio valuation details
TAG German portfolio valuation details APPENDIX Jun-2023 Jun-2023 Share of operational Dec-2022 Dec-2022 Dec-2022 Region Jun-2023 YTD 2023 Share of yield Fair value Implied performance/ other Fair value Fair value Implied (in EURm) Fair value (IFRS) Valuation result compression (EUR/sqm) multiple ma
Slide 36: TAG LTV calculation
TAG LTV calculation APPENDIX (in EURm) 30 Jun-2023 31 Dec-2022 31 Dec-2021 Non-current and current liabilities to banks 2,515.1 2,522.0 2,066.5 Non-current and current liabilities from corporate bonds and other loans 537.3 798.6 546.3 Non-current and current liabilities from convertible bonds 462.0
Slide 37: TAG net financial result calculation
TAG net financial result calculation APPENDIX (in EURm) Q2 2023 Q1 2023 H1 2023 H1 2022 FY 2022 + Interest income 0.5 1.0 1.5 13.0 3.0 - Interest expenses -18.1 -18.4 -36.5 -23.2 -54.0 + Other financial result -4.7 -0.1 -4.8 0.3 18.4 = Net financial result -22.4 -17.4 -39.8 -9.9 -32.6 + Financial re
Slide 38: TAG financial covenants overview as of 30 Jun-2023
TAG financial covenants overview as of 30 Jun-2023 Covenants leave extensive flexibility for further refinancings APPENDIX Instrument Volume Comments • Mostly ICR/ DSCR or LTV covenants with material headroom Bank loans EUR 2,351m • “Soft covenants”, i.e. breach does not lead to an termination of th
Slide 39: TAG decarbonisation strategy German portfolio
TAG decarbonisation strategy German portfolio APPENDIX Target CO2 emission Full commitment to reach CO2 emission level in line with 1.5oC climate goal Conducted study to define measures required to achieve goal Current emission of 30.5kg/sqm (based on last available data for 2021) 35 30.5 kg/s
Slide 40: Projected development of TAG's decarbonisation strategy
Projected development of TAG’s decarbonisation strategy Together with EWUS Energy consultants, TAG has developed a scenario for TAG’s decarbonisation APPENDIX TAG scenario Investment volume c. EUR 690m CO2 emission development (kg/sqm p.a.) 40 Green district heating, green electricity <28 kg/sqm Ext
Slide 41: TAG ESG ratings
TAG ESG ratings TAG ranks among the top ratings in the real estate sector APPENDIX ESG rating and award improvements TAG’s ESG disclosure improvement Since 2020 we have placed particular emphasis on improving our ESG performance and reporting in order to better meet the expectations of Sustainalyt
Slide 42: TAG share data
TAG share data Shareholder structure as of 31 Jul-2023 Share information as of 31 Jul-2023 APPENDIX 9.9% MFS (Massachusetts Financial Services Company), USA Market cap EUR 1,794m 9.9% 4.9% BayernInvest Kapitalverwaltungsgesellschaft mbH, GER NOSH issued 175.5m 4.9% NOSH outstanding 175.4m 4.7% Verso
Slide 43: TAG management board
TAG management board APPENDIX Claudia Hoyer, COO Martin Thiel, CFO Key responsibilities: Real Estate Management, Acquisitions and Key responsibilities: Accounting, Financing and Treasury, Disposals, Strategic Property Management/Marketing, Shared Service Taxes, Controlling, Legal, IT, Compliance
Slide 44: TAG management board compensation
TAG management board compensation F I X E D EUR 420,000 p.a. APPENDIX STIP (Short Term Incentive Plan) LTIP (Long Term Incentive Plan) Compensation in Cash Compensation in TAG shares (treasury shares) Based on total shareholder return (80%), i.e. share price development plus dividend Based o
Slide 45: TAG contacts
TAG contacts Martin Thiel Dominique Mann TAG Immobilien AG CFO Head of Investor & Public Relations Steckelhörn 5 Phone: +49 40 380 32-305 Phone: +49 40 380 32-305 20457 Hamburg Fax: +49 40 380 32-388 Fax: +49 40 380 32-388 Phone: +49 40 380 32-0 Fax: +49 40 380 32-388 ir@tag-ag.com ir@tag-ag.com www