Instone Real Estate Group Se · XETR:INS
Instone Real Estate — FY2020 Earnings Presentation
43 slides from Instone Real Estate's earnings presentation, Mar 18, 2021
Slide 1: Instone Real Estate FY 2020 Results
Instone Real Estate FY 2020 Results
Slide 2: Agenda
01 Highlights 02 Portfolio Update 03 FY Financial Performance 04 Outlook 05 ESG 06 Appendix
Slide 3: Highlights
INSTONE REAL ESTATE Highlights
Slide 4: Highlights
Highlights Strong operational performance despite headwinds from pandemic Strong demand environment (institutional + retail sales) in Q4 2020 and YTD with positive HPI growth momentum Construction: running according to plan, no tangible impact from pandemic (nine construction starts in FY 2020)
Slide 5: Corona Virus – Operating Update
Corona Virus – Operating Update COVID-19 impact limited to delays in approval processes Key topics Instone position Sales • Institutional: strong demand with improving price momentum • Retail: sales speed at pre-COVID levels, prices picking up again in Q4 Construction • Construction progress accordi
Slide 6: Retail sales activities fully recovered; Strong start to the year
Retail sales activities fully recovered; Strong start to the year Sales ratio In % Long term Instone Sales ratio Sales ratio Sales ratio without package sale Rottenburg 5.0 4.7 4.5 4.5 4.1 3.9 3.9 3.9 4.0 3.7 3.6 3.5 3.3 3.4 3.4 3.5 3.1 3.1 3.1 3.0 3.0 3.0 2.8 2.9 3.0 2.8 2.7 2.8 2.6 2.6 2.6 2.5 2.3
Slide 7: German residential prices: stable upward trend continues
German residential prices: stable upward trend continues - winner of the crisis New built condo prices development Recent data points/surveys show residential prices continue to move up Indexed, 2011 = 100% Germany Core Cities JLL: 2020 Ø ~€6.500/sqm Condo prices in top-8 cities up +9.3% (yoy) in H2
Slide 8: Portfolio Update
INSTONE REAL ESTATE Portfolio Update
Slide 9: Expansion of pipeline strong foundation for future growth
Expansion of pipeline strong foundation for future growth Exp. sales Project portfolio development, ytd (GDV) New project approvals Exp. units volume (€m) In €m 2020 Heusenstamm (near Frankfurt) 149 341 490 -68 89 6,054 5,846 -304 Halle, Heide South 38 151 Hannover, Buentekamp III 50 72 Nuremberg, B
Slide 10: Significant share of pre-sold units supports future cash flow and earnings visibility
Significant share of pre-sold units supports future cash flow and earnings visibility Project portfolio as of 31/12/2020 by region (GDV) Project portfolio as of 31/12/2020 by development (GDV) In % Munich In % Berlin 3.0 6.1 Nuremberg Under 6.4 construction 27.9 Hamburg Frankfurt 6.5 35.8 Total: Stu
Slide 11: FY Financial Performance
INSTONE REAL ESTATE FY Financial Performance
Slide 12: Adjusted Results of Operations
Adjusted Results of Operations Strong Q4 with margins exceeding expectations €m Q4 2020 Q4 2019 Change FY 2020 FY 2019 Change Revenues 188.8 434.3 -56.5% 480.1 736.7 -34.8% Strong Q4 revenues as expected with support from private as well as institutional demand; Q4 Project cost -136.3 345.3 -56.5%
Slide 13: Diversified sales & adjusted revenue mix
Diversified sales & adjusted revenue mix 2020 concluded sales by customer 2020 adjusted revenue by customer In % In % Institutional Institutional sales revenues 38.7 Retail 42.3 Retail sales revenues Total: 61.3 Total: 57.8 €464.4m €480.1m Expected strong Q4 institutional sales... ...also retail
Slide 14: Strong balance sheet a competitive edge in current markets
Strong balance sheet a competitive edge in current markets €m 31/12/2020 31/12/2019 LTC of just 25.7% implies low financial gearing Corporate debt 207.2 180.8 Reminder: inventories are recorded at historical costs Project debt 274.5 414.7 Financial debt 481.7 595.5 Significant hidden reserves
Slide 15: Strong cash generation in FY 2020 despite land investments
Strong cash generation in FY 2020 despite land investments t/o t/o Cash Flow (€m) FY 2020 FY 2019 Liquidity (€m) Total drawn available EBITDA adj. 87.9 133.7 Corporate debt Other non-cash items Promissory notes 206.0 206.0 0.0 -3.8 -38.8 Revolving Credit Facilities 119.0 0.0 119.0 Taxes paid -11.4 -
Slide 16: Intrinsic pipeline value suggests fundamental upside
Intrinsic pipeline value suggests fundamental upside Additional upside from continuous deployment of proceeds from capital increase Prospective NAV (€m) as of 31/12/2020 ACTUAL Expected selling prices of project pipeline 6,054 (GDV) Payments received reflect project related income received Payment
Slide 17: Outlook
INSTONE REAL ESTATE Outlook
Slide 18: Earnings guidance confirmed, strong structural growth ahead
Earnings guidance confirmed, strong structural growth ahead €m Outlook 2021 Revenues (adjusted) outlook In €m Revenues (adjusted) 820-900 1,600-1,700 Gross profit margin (adjusted) 26-27% >1,000 820-900 EAT (adjusted) 90-95 Volume of concluded >900 Sales contracts 2021 2022 ... Mid-term Dividend:
Slide 19: ESG Strategy
INSTONE REAL ESTATE ESG Strategy
Slide 20: ESG is integral part of INS's corporate strategy
ESG is integral part of INS’s corporate strategy 1. ESG integration into corporate governance / organisational structure (in 2020) • Clearly defined ESG responsibilities established within the INS corporate structure • Management board responsibility: CFO Foruhar Madjlessi • Establishment of dedicat
Slide 21: Overview: Major ESG-KPIs – Targets/Achievements
Overview: Major ESG-KPIs – Targets/Achievements Major KPIs Achievements 2020 Targets -50% (2030) CO2 reduction as overall objective 11 kgCO2 /sqm climate neutrality (2050) E Share of projects with renewable energy supply ~13% at least 40% (2030) Share of building with high energy efficiency standard
Slide 22: Appendix
INSTONE REAL ESTATE Appendix
Slide 23: Income statement (reported)
Income statement (reported) €m FY 2020 FY 2019 Total revenues 464.4 509.5 The lower revenues are attributable to the impact of the 1st lock-down Changes in inventories 45.0 277.3 (temporary lower sales activities and postponed marketing launches). Moreover, the FY 2019 figure also included the exc
Slide 24: Condensed balance sheet
Condensed balance sheet €m 31/12/2020 31/12/2019 The increase in inventories is mainly due to the purchase of new land. As of Q4, land acquisitions (incl. incidental costs) of €589.0m (2019: €548.9m) Non-current assets 52.9 20.4 are included in inventories. Inventories 777.8 732.1 Receivables fr
Slide 25: Well balanced financing structure at attractive terms
Well balanced financing structure at attractive terms Maturity profile as of 31/12/2020 Secured/unsecured* as of 31/12/2020 In €m Corporate debt Project debt In % Corporate debt Project debt, secured 167 173 95 100 40.7 28 78 15 59.3 2021 2022 2023 2024 2025 Weighted average corporate debt maturity
Slide 26: Project Portfolio Key Figures
Project Portfolio Key Figures €m Q4 2020 Q3 2020 Q2 2020 Q1 2020 Q4 2019 Q3 2019 Q2 2019 Q1 2019 Volume of sales contracts 246.0 94.9 54.1* 69.4 1,088.2 183.1 69.0 62.8 Project Portfolio (as of) 6,053.6 5,937.5 5,701.3 5,744.4 5,845.7 5,384.1 5,091.7 4,790.2 thereof already sold (as of) 2,328.8 2,10
Slide 27: 2020 – Concluded Sales Contracts (Top Projects)
2020 – Concluded Sales Contracts (Top Projects) Project City Units €m Concluded sales contracts Stephanstraße* Nürnberg 464 / In €m units St. Marienkrankenhaus Frankfurt am Main 47 57.9 2,733 Schulterblatt "Amanda" Hamburg 71 53.2 1,403 "Wohnen im Hochfeld" Unterbach Düsseldorf 99 40.7 Delkenheim, L
Slide 28: 2020 – Revenue Contribution
2020 – Revenue Contribution Project City Adj. revenues (€m) St. Marienkrankenhaus Frankfurt/Main 74.5 west.side Bonn 45.3 Schumanns Höhe Bonn 36.4 Schulterblatt "Amanda" Hamburg 34.9 Quartier Stallschreiber Straße - Berlin 32.9 Luisenpark Westville Frankfurt/Main 28.3 City-Prag - Wohnen im Theatervi
Slide 29: 2020 Construction Launches
2020 Construction Launches Exp. Sales Project City Start in Units Volume (€m) Schulterblatt "Amanda" Hamburg Q2 ~ 94 ~ 165 Schorndorf, S`LEDERER Schorndorf Q2 ~ 87 ~ 230 Niederkasseler Lohweg Düsseldorf Q3 ~ 80 ~ 220 „Neckar.Au Viertel“ Rottenburg Q3 ~ 24 ~ 65 „Carlina Park“ Nuremberg Q3 ~ 67 ~ 100
Slide 30: Sales Offer as of Q4 2020 (Top Projects, condominium sales)
Sales Offer as of Q4 2020 (Top Projects, condominium sales) Project City Sales volume (€m) Units Already sold in % Seetor "City Campus" - Living Nuremberg 72.2 142 11% „Carlina Park“, Schopenhauerstraße Nuremberg 35.3 36 48% St. Marienkrankenhaus Frankfurt/Main 29.0 22 85% Fontane Gärten BA 1 Potsda
Slide 31: Project Portfolio as of Q4 2020
Project Portfolio as of Q4 2020 (projects > €30m sales volume, representing total: ~ €6.1bn) Sales volume Land plot Building right Sales Construction Project Location (expected) acquired obtained started started Hamburg Schulterblatt "Amanda" Hamburg 95 Mio. € Kösliner Weg Norderstedt-Garstedt 85 Mi
Slide 32: Project Portfolio as of Q4 2020
Project Portfolio as of Q4 2020 (projects > €30m sales volume, representing total: ~ €6.1bn) Sales volume Land plot Building right Sales Construction Project Location (expected) acquired obtained started started Rhine-Main Wiesbaden-Delkenheim, Lange Seegewann Wiesbaden 106 Mio. € Siemens-Areal Fran
Slide 33: Project Portfolio as of Q4 2020
Project Portfolio as of Q4 2020 (projects > €30m sales volume, representing total: ~ €6.1bn) Sales volume Land plot Building right Sales Construction Project Location (expected) acquired obtained started started Baden-Wurttemberg City-Prag - Wohnen im Theaterviertel Stuttgart 127 Mio. € Franklin Man
Slide 34: ESG organisational structure implemented in 2020
ESG organisational structure implemented in 2020 Responsible Managing Board member /CFO Sustainability Consultants Committee Sustainability Officer Expert team “E” Expert team “S” Expert team “G” 34 | 18.3.2021 | FY-2020
Slide 35: ESG: Fields of Action
ESG: Fields of Action 17 UN Sustainable Development Goals major impact moderate impact minor impact 35 | 18.3.2021 | FY-2020
Slide 36: Dedicated Actions Currently in Place
Dedicated Actions Currently in Place • Anti-COVID measures for employees, customers and contractors higher than the legal requirements • Provision of free fruit and vegetables in all subsidiaries • Support of sports programmes for our employees • Regular Safety trainings • Offer for occupational-med
Slide 37: Dedicated Actions Currently in Place
Dedicated Actions Currently in Place • Adjustment of Instone’s company car policy with the objective of increasing the number of hybrid and e-vehicles • Mobile working agreement between the company and the workers council • Progressive digitalisation in order to reduce paper consumption • Dismantlin
Slide 38: Westville, Frankfurt am Main
Westville, Frankfurt am Main Realizing an innovative energy concept Former industrial site turned into an attractive living quarter for more than 3,000 people ~1,300 apartments, thereof 380 subsidized Three kindergartens Large green areas incl. six playgrounds Specially designed heat pumps
Slide 39: Niederkasseler Lohweg, Düsseldorf
Niederkasseler Lohweg, Düsseldorf Creating living quarters on former industrial sites Brownfield redevelopment incl. deconstruction and recycling of a seven-storey office building Mix of 221 subsidized and privately financed apartments plus local square, 430 sqm playground and kindergarten Con
Slide 40: Theaterfabrik and Heeresbäckerei, Leipzig
Theaterfabrik and Heeresbäckerei, Leipzig Converting old buildings into sustainable game changers Harmonious unit of historical and new buildings Comprehensive, resource-friendly restoration Avoidance of emission-intensive construction measures* Preservation of the historical charm and cultu
Slide 41: Instone Share
Instone Share Basic data Shareholder structure (March 2021) Fidelity 9.99% • ISIN: DE000A2NBX80 • Ticker symbol: INS Janus Henderson 6.96% • No of shares: 46,988,336 DWS 5.38% • Index: SDAX • Market cap*: €1,125.4m Cohen & Steers 5.24% • Average daily trading Capital 4.87% volume: €1.6m • Free float
Slide 42: Financial Calendar
Financial Calendar 2021 March 18 Annual Report 2020 March 19 Virtual Roadshow (Credit Suisse), United Kingdom March 22 Virtual Roadshow (Stifel), Germany March 23 Virtual Roadshow (Kepler Cheuvreux), France March 24 Virtual Roadshow (Credit Suisse), Canada March 25 BofA EMEA Real Estate CEO Virtual
Slide 43: Investor Relations Contact
Investor Relations Contact Burkhard Sawazki Head of Business Development & Communication T +49 201 45355-137 M +49 173 2606034 burkhard.sawazki@instone.de Simone Cujai Senior Investor Relations Manager T +49 201 45355-428 M +49 162 8035792 simone.cujai@instone.de Instone Real Estate Group AG Grugapl
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