Slide 1: H1 2017 Financial Results Presentation
Berlin Nuremberg Dortmund Leipzig Frankfurt H1 2017 FINANCIAL RESULTS PRESENTATION Amsterdam Munich
Slide 2: Table of Contents
TABLE OF CONTENTS CORPORATE ACHIEVEMENTS HIGHLIGHTS FINANCIAL RESULTS & CAPITAL MARKET ACTIVITY OPERATIONS AND PORTFOLIO APPENDIX 2
Slide 3: Corporate Achievements
CORPORATE ACHIEVEMENTS Listing upgrade to Migration to Frankfurt Luxembourg Prime Standard Aroundtown is in the final Trading symbol On June 2, 2017, stages of redomiciling to Luxembourg, subject to Aroundtown was listed on AT1 the Prime Standard of the the EGM on September 13th 2017 Frankfurt Stock
Slide 4: Corporate Achievements
CORPORATE ACHIEVEMENTS EQUITY - OVER €1.3 BILLION ISSUANCE OF NEW EQUITY IN 2017 €426 million issuance of equity capital in USD 500 million perpetual notes issuance in May 2017 June 2017 Conversion of Series B 3% convertible bonds. €387 million has been converted and €56 million has been repurchased
Slide 5: Financial Highlights – H1 2017
FINANCIAL HIGHLIGHTS – H1 2017 Net Rental Adjusted Net Profit FFO I income EBITDA €777m €204m €195m €130m FFO I FFO yield 1) per share €0.18 6.7% Annualized Dividend Div yield1) per share 4.3% €0.23 Investment EPRA NAV Total assets LTV EPRA NAV incl. perpetual notes property incl. perpetual notes pe
Slide 6: Financial Results & Capital Market Activity
FINANCIAL RESULTS & CAPITAL MARKET ACTIVITY 6
Slide 7: Profit and Loss
PROFIT AND LOSS 1-6/2017 1-6/2016 Net rental income (in €M) € million Net rental income 204 95 of which relating to properties marked for disposal 19 - Net rental income, recurring long-term 184 95 Rental and operating income 237 110 Revaluations, capital gains and other income 748 410 Share in prof
Slide 8: Adjusted EBITDA
ADJUSTED EBITDA € million 1-6/2017 1-6/2016 Operating profit 991 609 Depreciation and amortization 1 1 subtracted as these profits EBITDA 992 610 include AT’s share in non- operational profits Revaluations, capital gains and other income (748) (410) generated by the equity- Share in profit from inve
Slide 9: FFO I
FFO I € million 1-6/2017 1-6/2016 FFO I annualized (in €M) Adjusted EBITDA commercial portfolio 168 79 Finance expenses (30) (19) Current tax (19) (8) Contribution to minorities (4) (3) FFO I commercial portfolio 116 50 FFO relating to properties marked for disposal (12) - FFO I commercial portfolio
Slide 10: Total Assets
TOTAL ASSETS € million Jun 2017 Dec 2016 Investment property 7,437 5,016 High balance of cash Equity accounted investee, holding in GCP SA 1,439 1,317 and liquid assets enable Aroundtown to Equity accounted investee, other 344 240 pursue attractive Non-current assets 9,698 6,989 acquisition Assets h
Slide 11: EPRA NAV
EPRA NAV Jun 2017 Dec 2016 EPRA NAV (€ bn) € million Per share € million Per share NAV per the financial statements 6,006 3,941 Equity attributable to perpetual notes investors (1,022) (478) NAV excluding perpetual notes 4,984 3,463 Effect of in-the-money convertible bond 7 394 Fair value of derivat
Slide 12: Conservative Capital Structure
CONSERVATIVE CAPITAL STRUCTURE Debt maturity profile > 6 years average maturity 1.8% cost of debt Loan-to-Value Strong cover ratios (H1 2017) Unencumbered assets 12 *assuming conversion of Series B and Series C convertible bonds
Slide 13: Financial Policy and Investment Grade Rating
FINANCIAL POLICY AND INVESTMENT GRADE RATING Financial risk profile Aroundtown financial policy: 1 2 3 4 5 6 Minim Modest Intermediate Significant Aggre High al ssive Levera Strive to achieve A- global rating in the ged long term 1 aaa/ bbb- Business risk profile Excellent aa a+/a a- bbb aa+ /bb+ (D
Slide 14: Capital Market Activity
CAPITAL MARKET ACTIVITY Equity and bond bookrunners Largest European real estate issuer in 2016 2017 YTD is well on its way to matching the 2016 record year 14
Slide 15: Operations and Portfolio
OPERATIONS AND PORTFOLIO 15
Slide 16: Top Tier German/NL Cities (June 2017)
TOP TIER GERMAN/NL CITIES (JUNE 2017) Group Regional distribution* (by value) inhabitants per sqkm (2013) June 2017 In-place rent* 7.8 €/sqm June 2017 EPRA Vacancy* 8.0% 16 * Including accounting 36% in GCP’s portfolio
Slide 17: Commercial Investment Properties (June 2017)
COMMERCIAL INVESTMENT PROPERTIES (JUNE 2017) Portfolio breakdown per asset type Value Area EPRA Annualized In-place rent Value per Rental (in €M) (in 000' sqm) vacancy net rent (in €M) per sqm (in €) sqm (in €) yield Office 4,451 1,935 10.0% 237 10.8 2,300 5.3% Hotel 1,347 632 2.2% 72 10.3 2,132 5.4
Slide 18: Commercial Portfolio – Potential to Come
COMMERCIAL PORTFOLIO – POTENTIAL TO COME Commercial current annualized Rental Income vs. Commercial in-place rent compared to market rent prices Market potential including vacancy reduction Large upside potential from rent increases to market levels with very limited downside risk Long lease terms w
Slide 19: Top Tier Cities (June 2017)
TOP TIER CITIES (JUNE 2017) Asset Type Breakdown* *Accounting for 36% in GCP portfolio Residential geographical breakdown Commercial geographical breakdown 19 All breakdowns are by value
Slide 20: Top Tier Cities Within Asset Classes (June 2017)
TOP TIER CITIES WITHIN ASSET CLASSES (JUNE 2017) Office geographical breakdown Commercial asset type breakdown all breakdowns are by value Hotel geographical breakdown Logistic/Wholesale/Other Retail geographical breakdown geographical breakdown 20
Slide 21: Quality Locations in Berlin Inner City
QUALITY LOCATIONS IN BERLIN INNER CITY 87% of the commercial portfolio is located in top neighborhoods including the inner city, strongly benefiting from the unique dynamics and growth of Berlin’s most in demand neighborhoods, business areas and tourist centres 13% of the commercial portfolio is wel
Slide 22: Defensive Portfolio with Strong Tenant Structure
DEFENSIVE PORTFOLIO WITH STRONG TENANT STRUCTURE Limited dependency on single tenants due to large tenant base of over 2,500 tenants Long lease terms with a WALT of 7.2 years as of October 2017 22
Slide 23: Highly Performing Hotel Locations
HIGHLY PERFORMING HOTEL LOCATIONS 79 hotels - by category (by value) Many of the hotel assets are held through a 98% stake in Prime City Investment Well diversified portfolio of branded hotels totaling more than €1.3 bn and 632k sqm as of June 2017 High proportion (82%) in 4 star hotels, meeting the
Slide 24: Appendix
APPENDIX 24
Slide 25: Equity Analyst Research Coverage
EQUITY ANALYST RESEARCH COVERAGE Covering Analysts Analyst Research Target Price Analyst recommendations are set to Buy and above the current share price 25
Slide 26: Aroundtown's Share Price Performance
AROUNDTOWN‘S SHARE PRICE PERFORMANCE Share performance since initial placement of capital (13.7.2015) The share Frankfurt Stock Exchange Placement (Prime Standard) Share issue price development Shareholder structure (fully diluted) 13.07.2015 First equity issuance (€3.2 per share) Number of shares (
Slide 27: Aroundtown's Bond Performance
AROUNDTOWN’S BOND PERFORMANCE Convertible bond Series C performance since placement (15.12.2015) Spread over mid-€-swap for straight bonds A and D, remaining 5 years Spread over mid-€-swap for 3.75% Perpetual Notes 27
Slide 28: Strategy and Business Model
STRATEGY AND BUSINESS MODEL STRONG CASH FLOW, QUALITY Quality assets PORTFOLIO WITH GROWTH top tier cities, POTENTIAL Germany/NL REPOSITIONING AND Healthy capital OPERATIONAL Creation Attractive IMPROVEMENTS structure with a Keep improving the acquisitions below strong & company rating market & belo
Slide 29: Investment Highlights
INVESTMENT HIGHLIGHTS 1 Proven business model and successful track-record Well allocated assets in the top cities of Germany and NL Highly cash generative portfolio resulting from successful repositioning Proven ability to drive operational performance, increase rents and occupancy and exten
Slide 30: Full Control Over the Entire Operational Value Chain
FULL CONTROL OVER THE ENTIRE OPERATIONAL VALUE CHAIN • signs off on finalized rent contracts • Rental and marketing responsibility • monitors performance Head of • Lease management Operations • Contract negotiations • WALT management • 24/7 tenant service • Capex analysis Legal • Performance monitor
Slide 31: Lease Management as Drivers for Growth
LEASE MANAGEMENT AS DRIVERS FOR GROWTH – ACHIEVING LONG-TERM GROWING CASH FLOWS Localized one team touchpoint approach – building strong and long-term relationships with tenants. Teams become specialized with the individual asset, the tenants and the regional markets – proactively meeting tenants on
Slide 32: Rental and Marketing as Drivers for Additional Growth
RENTAL AND MARKETING AS DRIVERS FOR ADDITIONAL GROWTH Tailor made rental and marketing strategy on an asset basis Comprehensive vacancy analysis – conducting usability studies/letting concepts of vacant spaces in order to attract a large pool of diverse tenants Optimizing the usage of each asset and
Slide 33: Management
MANAGEMENT CEO and CFO CEO of Aroundtown. Previously, Mr. Mayo was the CEO of the Dankner Group, which under his management was a leading Shmuel international investment conglomerate with over $8 billion of assets. Mr. Mayo is since 2006 in the management of Aroundtown and its Mayo subsidiaries and
Slide 34: Office, Retail and Hotel Management Team
OFFICE, RETAIL AND HOTEL MANAGEMENT TEAM Markus Head of commercial operations. Before joining the Group he was a board member of Strabag AG and CEO of Raiffeisen evolution, responsible for project Neurauter development on 11 European countries with a development volume of more than €2bn. Mr. Neuraut
Slide 35: Regional Market Overview
REGIONAL MARKET OVERVIEW Hamburg ► GDP growth1: 1.9% ► Migration balance2: 0.9% Bremen ► Population density3: 2,334 per km2 ► GDP growth1 : 2.7% ► Migration balance2: 0.4% ► Population density3: 1,695 per km2 Hannover ► GDP growth (LS) 1: 2.1% NRW ► Migration balance2: 0.4% ► GDP share 2015 : 21% of
Slide 36: Germany – Growing and Strong Economy
GERMANY – GROWING AND STRONG ECONOMY GDP growth Debt/GDP 2016 Budget Surplus/Deficit 2015 Source: Eurostat Source: Eurostat, data as of Q3 2016 Source: destatis Germany has a growing GDP paired with a strong budget discipline… Unemployment rate 2016 Unemployment rate 1991-2016 Source: destatis Sourc
Slide 37: German Office Market: Low Supply and Strong Demand
GERMAN OFFICE MARKET LOW SUPPLY AND STRONG DEMAND… * in Top 7 locations according to DG HYP: Berlin, Munich, Construction of new commercial buildings in Germany Low addition of new office space* Frankfurt, Cologne, Hamburg, Düsseldorf, Stuttgart Increasing and above average office space take-up* Off
Slide 38: German Office Market: Increasing Rents and Occupancy
GERMAN OFFICE MARKET …LEAD TO INCREASING RENTS AND OCCUPANCY Top 7 locations: Berlin, Munich, Frankfurt, Cologne, Hamburg, Office rents are increasing Düsseldorf, Stuttgart Decreasing vacancy… …across Germany… 38 Source: DG HYP German Real Estate Market report
Slide 39: German Retail Market
GERMAN RETAIL MARKET Development of wages and consumer prices Increase in real disposable income Disposable income is increasing as real wages are increasing while inflation is decreasing,… Consumer climate Strong increase in retail sales 39 …which leads to a higher consumer climate and higher retai
Slide 40: German Retail Market
GERMAN RETAIL MARKET Retail rents are increasing Especially in the Top 7 cities Source: DG HYP German Real Estate Market report Strong consumer spending from strong employment market supports increasing rents 40
Slide 41: German Hotel Market Overview
GERMAN HOTEL MARKET OVERVIEW Overnight stays across all hotel accommodation types Transaction volume of hotel properties € millions millions RevPar development Rated hotels by category Insolvencies in the accommodation services sector # of bankruptcies Total: 8,521 *Jan 2017 Source: Smith Travel Res
Slide 42: Macro Fundamentals Support GCP
MACRO FUNDAMENTALS SUPPORT GCP Population in Germany Population Density Annualized growth in rent price index* 2012-2016 (residents per km²) From 1991 to 2015 the amount of households increased by 15.7% International and domestic immigration trends to cities also support House price index in real te
Slide 43: Hamburg Dortmund Hannover
Hamburg Dortmund Hannover Amsterdam Leipzig Frankfurt Berlin Baden-Baden Rheinsberg 43
Slide 44: Frankfurt Berlin Düsseldorf
Frankfurt Berlin Düsseldorf Rotterdam Nuremberg Stuttgart 44
Slide 45: Berlin Potsdam Munich
Potsdam Berlin Cologne Munich Amsterdam Hamburg Utrecht Cologne Dresden 45
Slide 46: Disclaimer
DISCLAIMER IMPORTANT: This presentation has been provided for information purposes only and is being circulated on a confidential basis. This presentation shall be used only in accordance with applicable law, e.g. regarding national and international insider dealing rules, and must not be distribute
Slide 47: Rotterdam Frankfurt Munich
Rotterdam Frankfurt Munich Leipzig Amsterdam Berlin 47