Deutsche Wohnen Se · XETR:DWNI

Deutsche Wohnen — Investor Presentation (May 2014)

29 slides from Deutsche Wohnen's investor presentation, May 16, 2014

  1. Slide 1: Company presentation May 2014

    Deutsche Wohnen AG » Company presentation May 2014 1

  2. Slide 2: Key investment highlights of Deutsche Wohnen

    » Key investment highlights of Deutsche Wohnen 1 Diversified business model with focus on metropolitan growth regions 2 Best in class portfolio quality with highest rental growth of Peer Group 3 Leadership in cost efficiency due to asset concentration 4 Proven track record at the capital markets 5 W

  3. Slide 3: Deutsche Wohnen business model "Made in Germany"

    » Deutsche Wohnen business model “Made in Germany” Strong CF for Shareholder Return Dividends + NAV growth Nursing & Residential letting business Privatization & assisted living institutional >EUR 600m gross rents from sales Backed by high-quality portfolio1) demographic Additional cash trends >EUR

  4. Slide 4: Deutsche Wohnen portfolio focussed and concentrated

    » Deutsche Wohnen portfolio focussed and concentrated Portfolio development underlines shift to growth regions with significant upside potential Total residential holdings: ~150,000 units  Thereof ~80% in dynamic Core+-regions (~119,000 units) Hanover Berlin  Thereof ~72% in Greater Berlin (~108,0

  5. Slide 5: Portfolio structure – characteristics meeting strong demand

    » Portfolio structure – characteristics meeting strong demand In-place rent1) ( 5.53€/sqm/month) Year of construction 25.4% 31.7% 29.5% 19.6% 15.4% 19.5% 11.9% 15.3% 6.9% 7.2% 3.1% 3.8% 1.5% 2.2% 3.1% 3.4% 0.6% > = 8.01 <=3.50 3.51 - 4.00 4.01 - 4.50 4.51 - 5.00 5.01 - 5.50 5.51 - 6.00 6.01 - 6.50 6

  6. Slide 6: Strong like-for-like development

    » Strong like-for-like development 1) Total Portfolio Letting Portfolio Core+ regions In-place rent (EUR/sqm) In-place rent (EUR/sqm)  Comprises ~ 84,700 units under management since Dec 2008  Comprises ~ 72,000 units under management since Dec 2008 Letting Portfolio Core regions Letting Portfolio

  7. Slide 7: Dynamic rent potential in Core+ regions

    » Dynamic rent potential in Core+ regions (letting portfolio) 1) 3) New-letting rent in New-letting In-place rent in EUR/sqm Rent potential EUR/sqm2) contracts4) Core+ 5.69 24.6% 7.09 2,340 Greater 5.57 22.3% 6.81 1,979 Berlin Rhine- 7.04 26.3% 8.89 301 Main Rhineland 6.50 25.7% 8.17 60  Current te

  8. Slide 8: Berlin residential real estate market offering attractive fundamentals

    » Berlin residential real estate market offering attractive fundamentals Demographics Supply and Demand  Ca. 2.03m households with 54.3% single-person  Number of inhabitants increases consistently households (+1.3%pts. since 2007) and Ø 1.73 persons (mainly because of net migration gain) per house

  9. Slide 9: Berlin's key facts

    » Berlin's key facts (1) Population (2) Residential units Number of residential units Population Berlin (2012)(1) ca. 1.9m (10/2013)(1) ca. 3.4m Number of residential units for letting (2012)(6) ca. 1.6m Population Capital Region Berlin-Brandenburg Completed apartments 2013 (10/2013)(1) ca. 4.5m (20

  10. Slide 10: Core+ and Core regions showing positive fundamentals

    » Core+ and Core regions showing positive fundamentals1) Rhine-Main region incl. Rhineland region incl. Hanover / Brunswick / Frankfurt/ Main Dusseldorf Magdeburg  One of the most important regions Focus on Dusseldorf:  Favourable location in the in Germany with 5.6 m inhabitants centre of Germany

  11. Slide 11: LTV at 56.5%; low average interest rate ~3.36%

    » LTV at 56.5%; low average interest rate ~ 3.36% Financial liabilities in EUR m Mark-to-market 5,288.5 Debt structure LTV (%) 56.5% Nominal value 5,379.0 LTV (%) 57.5%  Avg. interest rate incl. Convertible bond: ~3.36%  Avg. mandatory redemptions p.a.: ~1.6% Debt service  Avg. weighted maturity:

  12. Slide 12: Strong position in the capital markets

    » Strong position in the capital markets Most investable German listed real estate company Impressive track record of placements  Free float market cap1) increased by ~ 78% from EUR 2.3bn (April 2013) to EUR 4.2bn (April 2014)  3 structured equity transactions in 2013  Largest free float of all r

  13. Slide 13: Strong earnings and cash contributions from letting

    » Strong earnings and cash contributions from letting in EUR m Q1-2014 Q1-2013 In-place rent: Q1-14: EUR 5.58 / sqm Current gross rental income 157.0 83.3 Non-recoverable expenses (3.2) (1.3) Earnings Maintenance1) from letting: Rental loss (2.5) (1.1) Q1-14: EUR 7.38 /sqm + EUR Maintenance (17.2) (

  14. Slide 14: NAV contribution by strong disposal business

    » NAV contribution by strong disposal business Closed in EUR m Q1-2014 Q1-2013  Free cash flow from sales Sales proceeds 86.4 32.1 activities of ca. EUR 45m (520 closed privatisation units and 982 Cost of sales (3.0) (2.0) closed units institutional sales) Net sales proceeds 83.4 30.1 Carrying amou

  15. Slide 15: Nursing and Assisted Living − increasing FFO contribution

    » Nursing and Assisted Living − increasing FFO contribution in EUR m Q1-2014 Q1-2013 31/03/2014 Facilities Places Income Greater Berlin 12 1,442 Nursing 13.7 11.8 Saxony 7 475 Living 1.5 0.5 Others 2 257 Other 1.6 1.0 In total 21 2,174 Total income 16.8 13.3 Costs Average Occupancy Nursing and corpo

  16. Slide 16: Adjusted EBITDA increased by ~EUR 61m / +93% (y-o-y)

    » Adjusted EBITDA increased by ~ EUR 61m / + 93% (y-o-y) in EUR m Q1-2014 Q1-2013 Earnings from Residential Property Management 131.7 70.9 Earnings from Disposals 15.8 5.5 Earnings from Nursing and Assisted Living 4.2 3.1 Segment contribution margin 151.7 79.5 Cost Ratio1) Corporate expenses (22.8)

  17. Slide 17: Adjusted EBT increased by ~113% (y-o-y)

    » Adjusted EBT increased by ~ 113% (y-o-y) in EUR m Q1-2014 Q1-2013 in EUR m Q1-2014 Q1-2013 EBITDA (adjusted) 126.7 65.7 Interest expenses (47.1) (27.4) Non-cash interest expenses (5.2) (2.9) Depreciation (1.6) (1.3) 2) 3) (52.3) (30.3) Financial result (net) (52.0) (30.1) Interest income 0.3 0.2 E

  18. Slide 18: Recurring FFO per share performance +5% (y-o-y)

    » Recurring FFO per share performance +5 % (y-o-y) in EUR m Q1-2014 Q1-2013 FFO development in EUR m Profit 45.5 26.2 22.2 36.4 74.4 Earnings from Disposals (15.8) (5.5) Depreciation 1.6 1.3 15.3 Valuation SWAP and Convertible Bond 16.7 0.2 Non-cash financial expenses 5.2 2.9 Deferred taxes 5.4 5.3

  19. Slide 19: Balance sheet

    » Balance sheet Assets Equity & Liabilities in EUR m 31/03/2014 31/12/2013 in EUR m 31/03/2014 31/12/2013 Investment properties 8,907.8 8,937.1 Total equity 3,977.8 3,944.3 Other non-current assets 551.4 552.2 Financial liabilities 5,032.1 5,154.6 Derivatives 0.2 2.7 Convertible 256.4 250.2 Deferred

  20. Slide 20: EPRA NAV per share up by 1.6%

    » EPRA NAV per share up by 1.6% in EUR m 31/03/2014 31/12/2013 in EUR m 31/03/2014 31/12/2013 Equity (before non-controlling EPRA NAV per share in EUR 3,810.1 3,777.8 14.22 13.99 interests) (undiluted) Fair value adjustment of Adjusted NAV per share in 6.0 (2.2) 12.50 12.27 convertible bond EUR (und

  21. Slide 21: Guidance 2014 (unchanged)

    » Guidance 2014 (unchanged) FFO (w/o disposals): min. EUR 210m FFO expected 1  EUR 203m considering 8% minority share = EUR 0.71 per share (+9.2% growth) 2 Dividend policy: 60% of FFO (w/o disposals) = EUR 0.42 per share (+23.5% growth) 3 Synergies: EUR 15m to be generated in 2014, thereof EUR 10m

  22. Slide 22: Appendix

    » Appendix deutsche-wohnen.com ‘ ) a Deutsche Wohnen 22

  23. Slide 23: Overview of portfolio as at 31 March 2014

    » Overview of portfolio as at 31 March 2014 1) 31/03/2014 Residential Share in Area In-place Vacancy Fair Share in Fair Multiple Yield Multiple Yield 2) 3) 4) units terms of rent Value terms Value in-place market units K sqm of Fair Value rent rent # % EUR/sqm % EUR m % EUR/sqm % % Total 148,797 100

  24. Slide 24: Details on regions of portfolio as at March 2014

    » Details on regions of portfolio as at 31 March 2014 31/03/2014 Residential Share in terms Commercial Parking units of units Area In-place rent 1) Vacancy units spaces # in % k sqm EUR/sqm in % # # Total 148,797 100% 9,040 5.58 2.6% 2,098 31,408 Strategic core and growth regions 145,979 98% 8,860 5

  25. Slide 25: The Berlin-Portfolio at a glance

    » The Berlin-Portfolio at a glance Reinickendorf Pankow # 11,889 5.36 2.2% # 8,764 5.90 0.8% Mitte Friedrichshain-Kreuzberg # 3,739 5.67 1.6% # 7,903 5.56 1.2% Lichtenberg # 7,604 5.62 1.4% Spandau # 15,190 5.26 2.9% Marzahn-Hellersdorf # 8,670 4.89 2.7% Charlottenburg-Wilmersdorf # 7,959 6.23 0.9%

  26. Slide 26: Hidden Champions – backbone of German economy

    » Hidden Champions – backbone of German economy Number of Hidden Champions Germany 1.307 Hidden Champion = 1. No. 1 on continent and/or Top 3 USA 366 worldwide in their sector 2. Revenues < 5 bn Euro Japan 220 3. Mainly family-owned, max 5,000 employees Austria 116 Switzerland 110 Main Reasons: Ital

  27. Slide 27: Management board and areas of responsibilities

    » Management board and areas of responsibilities Michael Zahn Andreas Segal Lars Wittan Chief Executive Officer Chief Financial Officer Chief Investment Officer (CEO) (CFO) (CIO) Areas of responsibility: Areas of responsibility: Areas of responsibility:  Strategy  Equity Financing  Accounting/Tax

  28. Slide 28: Disclaimer

    » Disclaimer This presentation contains forward-looking statements including assumptions, opinions and views of Deutsche Wohnen or quoted from third party sources. Various known and unknown risks, uncertainties and other factors could cause actual results, financial positions, the development or the

  29. Slide 29: Deutsche Wohnen AG Pfaffenwiese 300 65929 Frankfurt/Main

    Deutsche Wohnen AG Registered Office Berlin Office Pfaffenwiese 300 Mecklenburgische Straße 57 65929 Frankfurt/ Main 14197 Berlin Phone: +49 30 897 86 551 Fax: +49 30 897 86 507 © 2014 Deutsche Wohnen AG 29

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