Investis Holding SA · SIX:IREN
Investis Holding SA — FY2020 Earnings Presentation
45 slides from Investis Holding SA's earnings presentation, Mar 24, 2021
Slide 1: Full Year Results 2020
FULL YEAR RESULTS 2020 24 March 2021
Slide 2: Disclaimer
Disclaimer This communication contains specific forward-looking statements, beliefs or opinions, including statements with respect to objectives, which are based on current beliefs, expectations and projections about future events and assumptions of the management of Investis Holding SA ("Investis")
Slide 3: Agenda
Agenda Highlights of FY 2020 Market trends in a COVID-19 environment Financial overview FY 2020 Outlook Q&A Annexes FULL YEAR RESULTS 2020 – IR PRESENTATION – 24 MARCH 2021 3
Slide 4: Highlights FY 2020: Impressive result despite the pandemic
Highlights FY 2020 Impressive result despite the pandemic Group ▪ NAV per share excluding deferred taxes with regard to properties increased to CHF 74.80 (CHF 67.61) ▪ Very solid capital structure : − Gross LTV at 37.6% − Equity ratio at a comfortable 52.8% − Interest bearing debt at 36% of total as
Slide 5: Covid-19 Implications
Covid-19 Implications Thanks to our rapid response and dedicated employees, the impact of the pandemic was mitigated to a large extent ▪ No exposure to commercial real estate Properties ▪ Rent reduction in commercial units of CHF 0.2m ▪ High vacancy in serviced apartments up to Q2 − Exit from servic
Slide 6: Very positive performance
Very positive performance FULL YEAR RESULTS 2020 – IR PRESENTATION – 24 MARCH 2021 6
Slide 7: Agenda
Agenda Highlights of FY 2020 Market trends in a COVID-19 environment Financial overview FY 2020 Outlook Q&A Annexes FULL YEAR RESULTS 2020 – IR PRESENTATION – 24 MARCH 2021 7
Slide 8: Real Estate Market in Geneva
Real Estate Market in Geneva Lake Geneva region remains an attractive location Migration/ Demography Construction activity Regulations Capital Markets ▪ Net migration into Switzerland ▪ Moderate construction activity ▪ Tax regime for corporations ▪ CHF interest rates expected remaining positive in 2
Slide 9: Real Estate Market in Geneva: demand in residential market
Real Estate Market in Geneva Although stronger construction activity and lower migration, the pandemic has not significantly changed demand in the residential market ▪ Slow down of the population growth in 2020 +0.4% +2,009 1), however, remaining positive − 2019: +1.0% / 2018: +0.7% / 2017: +0.9% /
Slide 10: Real Estate Market Switzerland: lowest vacancy rates
Real Estate Market Switzerland Investis’ key markets among the lowest vacancy rates – unlikely to change Source: WüestPartner FULL YEAR RESULTS 2020 – IR PRESENTATION – 24 MARCH 2021 10
Slide 11: Low vacancy in Investis' key markets
Real Estate Market in Switzerland Low vacancy in Investis’ key markets (years 2018-2020) Source: SVIT Suisse FULL YEAR RESULTS 2020 – IR PRESENTATION – 24 MARCH 2021 11
Slide 12: Shortage of apartments in Investis' key market
Real Estate Market in Switzerland Shortage of apartments in Investis’ key market (# of apartments 2020) Source: WüestPartner FULL YEAR RESULTS 2020 – IR PRESENTATION – 24 MARCH 2021 12
Slide 13: Reletting period in Geneva lake region among shortest
Real Estate Market in Switzerland Reletting period in the Geneva lake region is among the shortest Duration of advertising for apartments on the market (day) As of March 2020 (Before Covd-19 crisis) Average Switzerland: 34 days Source: SVIT FULL YEAR RESULTS 2020 – IR PRESENTATION – 24 MARCH 2021 13
Slide 14: Geneva's vacancy rate declining again
Real Estate Market in Switzerland Geneva’s vacancy rate declining again and keeping well below national trend Switzerland Geneva 2.00 1.80 1.72 1.60 Vacany rate (in %) 1.40 1.20 1.00 0.80 0.60 0.49 0.40 0.20 0.00 Source: BFS, OCSTAT FULL YEAR RESULTS 2020 – IR PRESENTATION – 24 MARCH 2021 14
Slide 15: Real estate yield spread over 10-year bond remains wide
Real Estate Market in Switzerland Real Estate yield spread over 10-year bond remains wide despite further compression Residential prime net yield by city and Swiss 10-year bond yield Geneva Lausanne Zurich 10-y Bond 3.50% 3.00% 2.50% 2.00% 1.50% 1.00% 0.50% 0.00% -0.50% -1.00% Source: WP, CBRE FULL
Slide 16: Strategy: Buy and hold, Rue du Nant 30 Geneva
Strategy: Buy and hold Rue du Nant 30 – Geneva – Acquisition in December 1998 Appraisal value Rent in CHF m in CHF k 1998 Residential block built in 1986 with 40 residential units and 2 retail units 339 2014 Renovation of bathrooms and kitchens 2015 Additional energy efficiency renovation 12.3 623 +
Slide 17: Real Estate Market in Switzerland – to sum up
Real Estate Market in Switzerland – to sum up Investis is active in markets where there is a constant situation of undersupply in the residential market – Lake Geneva region is Investis’ USP and highly differentiates from its peers in the Swiss residential market: ▪ Low vacancy rates ▪ Low interest
Slide 18: Agenda
Agenda Highlights of FY 2020 Market trends in a COVID-19 environment Financial overview FY 2020 Outlook Q&A Annexes FULL YEAR RESULTS 2020 – IR PRESENTATION – 24 MARCH 2021 18
Slide 19: FY 2020 in brief – impressive results under the circumstances
FY 2020 in a brief – impressive results under the circumstances Comparative figures for 2019 were boosted by the one-time release of tax liabilities ▪ Investis Group: − Operating performance excl. revaluations just shy of prior year at CHF 45.5m (2019: CHF 46.7m) − Net profit at CHF 113.6m (CHF 172.
Slide 20: Investis Group: Overview on the financial performance 2020
Investis Group: Overview on the financial performance 2020 (CHFm) FY 2020 Δ in % FY 2019 FY 2018 FY 2017 FY 2020 Revenues FY 2020 Invested Capital Revenue 178.7 -4.7 187.5 197.5 190.0 1% EBITDA 45.5 -2.4 46.7 39.7 37.3 32% before revaluations/disposals Income from revaluations / from 68% 93.4 44.1 6
Slide 21: Properties: geographical concentration in Lake Geneva region
Properties: The geographical concentration in the Lake Geneva region remains an ADVANTAGE... Outstanding EBIT boosted by revaluation gains of CHF 79m (CHFm) FY 2020 Δ in % FY 2019 FY 2018 FY 2017 ▪ Like-for-like rental growth +1.6% (as at 31.12.2019: +0.4%) Revenue 57.9 +1.6 57.0 55.0 47.5 ▪ Low vac
Slide 22: Properties: Further expanding portfolio
Properties: Further expanding portfolio -> adding value & rental growth -> buy and hold Property Portfolio: 167 buildings – 3,006 residential units – value CHF 1.49 bln by category: by canton: by apartment type1) : 5% 4% 14% 28% 24% 28% 72% 95% 30% Residential Commercial GE VD VS 1-room 2-room 3-roo
Slide 23: Properties: favourable portfolio mix delivering rental growth
Properties: favourable portfolio mix delivering like-for-like rental growth Potential for rental growth still ongoing Rent potential 75.0 based on CBRE appraisal (CHFm) 65.0 +13% 55.0 57.9 +4.1% 57.0 55.0 45.0 (CHFm) 47.5 +1.0% 40.8 41.9 35.0 37.8 37.2 35.0 32.4 25.0 27.3 Current rent 40.8 rent 1) 4
Slide 24: Real Estate Services: lower revenues due to disposals
Real Estate Services: lower revenues due to disposal of subsidiaries in 2019 New activities led to support and enhance EBIT margin by 0.2% points (CHFm) FY 2020 Δ in % FY 2019 FY 2018 FY 2017 FY 2020 Revenues Revenue 124.6 -8.4 136.0 147.8 147.6 EBIT 10.8 -6.3 11.5 7.7 7.8 EBIT margin 8.6% n/a 8.4%
Slide 25: Real Estate Services: evolution over the years
Real Estate Services: evolution over the years Steady growth of top line and much improved profitability Revenue evolution EBIT margin evolution CHFm in% FULL YEAR RESULTS 2020 – IR PRESENTATION – 24 MARCH 2021 25
Slide 26: Investis Group: Excellent net profit
Investis Group: Excellent net profit Release of deferred tax liabilities positively influenced net profit in FY 2019 (CHFm) FY 2020 Δ in % FY 2019 FY 2018 FY 2017 EBIT 136.2 +7.1 127.2 74.6 60.9 ▪ Financial income in 2019 included the effects of reducing the stake in Polytech Ventures Financial inco
Slide 27: Strong capital structure and prudent financing policy
Strong capital structure and prudent financing policy Solid balance sheet and liquidity allows to continue to invest in strategic priorities Balance Sheet (CHFm) 31.12.2020 Δ in % 31.12.2019 31.12.2018 31.12.2017 Debt structure per 31.12.2020 Cash and cash equivalents 15 -77.7 66 33 51 Bonds CHF 560
Slide 28: Debt structure (interest-bearing)
Debt structure (interest-bearing) Strategy of a low LTV of around 40% unchanged since IPO 800 700 660 Maturity of financial liabilities as at 31.12.2020 600 (CHFm) 520 560 500 Due within the first year 240 400 420 300 100 Due within the second year (CHFm) 180 200 100 Due within the third year 140 22
Slide 29: Events after balance sheet date
Events after balance sheet date Expansion of national market position in Real Estate Services ▪ Acquisition of 100% of Rohr AG − Solutions in specialist and facade cleaning − Maintenance cleaning − Integrated building management − Construction and operation of clean rooms − Revenue 2020 of CHF 41m ▪
Slide 30: Agenda
Agenda Highlights of FY 2020 Market trends in a COVID-19 environment Financial overview FY 2020 Outlook Q&A Annexes FULL YEAR RESULTS 2020 – IR PRESENTATION – 24 MARCH 2021 30
Slide 31: AGM on 27 April 2021 under special circumstances
AGM on 27 April 2021 to take place again under special circumstances All shareholders will have to exercise their voting rights by giving power of attorney to the independent proxy ▪ Riccardo Boscardin not standing for re-election ▪ All other members of the Board of Directors standing for re-electio
Slide 32: Cautious outlook – subject to evolution of the pandemic
Cautious outlook – still subject to the evolution of the pandemic Residential rental market least affected in the real estate sector in Switzerland by COVID-19 ▪ Immigration into Switzerland and specially into the Lake Geneva region remains an important driver − Important fluctuations during the pan
Slide 33: What makes INVESTIS unique?
What makes INVESTIS unique? ▪ Largest listed residential property owner in the undersupplied Lake Geneva region – sustaining demand, high return, low vacancies – continuous rent potential of 13% – low exposure in commercial properties ▪ High barriers of entry for new market players in Investis’ key
Slide 34: Agenda
Agenda Highlights of FY 2020 Market trends in a COVID-19 environment Financial overview FY 2020 Outlook Q&A Annexes FULL YEAR RESULTS 2020 – IR PRESENTATION – 24 MARCH 2021 34
Slide 35: Strategy and investment policy
Investis Group is a leading Swiss residential property company in the Lake Geneva region and a national Real Estate Services provider Strategy and investment policy ▪ Focus on residential properties in GE and VD ▪ Buy and hold ▪ Continuous reduction on developments ▪ Expansion of portfolio through t
Slide 36: Fundamental business strengths
Fundamental business strengths Value proposition FULL YEAR RESULTS 2020 – IR PRESENTATION – 24 MARCH 2021 36
Slide 37: Very focused and attractive portfolio around Lake Geneva
Very focused and attractive portfolio around the Lake Geneva Strategy buy and hold – realise rent upside potential Focus is on: ▪ Residential − 95% Residential − 5% Commercial VD: 24% ▪ Lake Geneva region ▪ Middle segment (no luxury apartments) ▪ Low vacancy rates GE: 72% VS: 4% FULL YEAR RESULTS 20
Slide 38: Real Estate Services: active nationwide with local brands
Real Estate Services: active nationwide with well-known local brands Focus on two Activities and two national brands for PROPERTY MANAGEMENT FACILITY SERVICES ▪ Property management ▪ Caretaking services ▪ Co-ownership associations ▪ Cleaning services ▪ Center management ▪ Building technology ▪ Letti
Slide 39: Property Management – Privera
Property Management – PRIVERA …. …. the leading independent Property Management company in Switzerland offers an integrated service throughout the lifecycle of a property with … Property Around 90% Co-ownership Construction management of revenues associations management ▪ Tenant selection, administr
Slide 40: Property Management – Privera: institutional clients
Property Management – PRIVERA …… …… focuses on institutional clients due to its nationwide presence ▪ Fully digitalised processes (incoming mail, application and rental process) ▪ Rents under Management at CHF 1.42bln ▪ 12 offices across the country, FTE of just under 400 ▪ Top 10 clients generate j
Slide 41: Facility Services – hauswartprofis/conciergepro
Facility Services – hauswartprofis/conciergepro …. …. 600 experts (FTE’s) have been taking care of the in- and outside of buildings for > 30 years Around 80% Maintenance Cleaning Building in residential services buildings ▪ Inhouse maintenance for apartment ▪ Apartments ▪ Guarantee daily operation b
Slide 42: Facility Services – focus on innovation
Facility Services – hauswartprofis/conciergepro …… …… focus on innovation with experienced staff ▪ 13 offices across the country, with FTE of around 600 ▪ Diversified business model with recurring, contract-based revenues ▪ Major player in the market combining all activities of facility services ▪ M
Slide 43: Facility Services – Rohr AG, Sea lab and ProLabo
Facility Services – Rohr AG, Sea lab and ProLabo …… focus on innovation ▪ Revenues of CH 41 in 2020 with around 1,000 employees ▪ Specialist in facade cleaning, maintenance cleaning and integrated building management ▪ Specialised in analysis of asbestos in building material, air, water ▪ Analysis o
Slide 44: Organisation
Organisation Valid as of 22 March 2021 FULL YEAR RESULTS 2020 – IR PRESENTATION – 24 MARCH 2021 44
Slide 45: Thank you for your attention!
Thank you for your attention! FULL YEAR RESULTS 2020 – IR PRESENTATION – 24 MARCH 2021 45