Tag Immobilien Ag · XETR:TEG
Tag Immobilien — Q2 2017 Earnings Presentation
34 slides from Tag Immobilien's earnings presentation, August 2017
Slide 1: Conference call presentation Q2 2017
Conference call presentation Q2 2017 1
Slide 2: Content
Content 22 CONTENT I. TAG highlights Q2 2017 3 II. TAG financials Q2 2017 6 III. TAG portfolio Q2 2017 13 IV. TAG valuation H1 2017 17 V. TAG acquisitions and disposals H1 2017 20 VI. TAG revised guidance FY 2017 23 VII. Appendix 25 Portfolio details by region EPRA Earnings LTV calculation C
Slide 3: TAG highlights Q2 2017
3 TAG TAG acquisitions highlights Q2 2016 2017
Slide 4: TAG highlights Q2 2017
TAG highlights Q2 2017 44 Q2 2017 Q1 2017 FY 2016 Q2 2016 Vacancy (residential units) 5.5% 5.9% 6.1% 7.1% HIGHLIGHTS Operational L-f-L rental growth Y-o-Y 2.0% 1.9% 2.0% 1.9% performance L-f-L rental growth Y-o-Y incl. vacancy reduction 3.3% 3.4% 3.7% 3.9% FFO I (EUR m) 30.9 28.5 97.0 23.3
Slide 5: TAG highlights Q2 2017
TAG highlights Q2 2017 55 Portfolio valuation carried out by CBRE as of 30 Jun-2017 (last valuation as of 30 Sep-2016): first half year valuation to reflect current market dynamics, thereby increasing transparency for investors. Portfolio Alignment in treatment of transaction cost with peer grou
Slide 6: TAG financials Q2 2017
6 TAG TAG acquisitions financials Q2 2016 2017
Slide 7: TAG income statement (IFRS)
TAG income statement (IFRS) 77 (in EUR millions) Q2 2017 Q1 2017 H1 2017 H1 2016 FY 2016 ❶ Rents slightly increased in Q2 2017 compared INCOME STATEMENT to Q1 2017 due to lfl-rental growth, no effects Rental income ❶ 71.8 71.5 143.3 136.0 275.2 from acquisitions in H1 2017. Expenses from property -1
Slide 8: TAG EBITDA, FFO and AFFO calculation
TAG EBITDA, FFO and AFFO calculation 88 (in EUR millions) Q2 2017 Q1 2017 H1 2017 H1 2016 FY 2016 Net income 51.9 22.1 74.0 40.1 200.7 ❶ EBITDA (adjusted) increased by EUR 3.1m to EUR 50.0m in Q2 2017 mainly due to higher EBITDA / FFO/ AFFO + Income tax 13.8 5.8 19.6 5.3 46.0 net rental income and i
Slide 9: TAG balance sheet (IFRS)
TAG balance sheet (IFRS) 99 (in EUR millions) 30 Jun-2017 31 Dec-2016 BALANCE SHEET Non-current assets 3,983.5 3,843.6 ❶ Increase in book value of investment properties mainly due to closing of acquisitions signed in Investment property ❶ 3,915.1 3,777.8 H1 2017 as of 30 Jun-2017. Deferred tax asset
Slide 10: TAG EPRA NAV calculation
TAG EPRA NAV calculation 10 10 EPRA NAV bridge (in EUR / share) NAV (in EUR millions) 30 Jun-2017 31 Dec-2016 Equity (without minorities) 1,390.6 1,350.9 + Deferred taxes on investment 300.0 287.1 properties and financial derivatives + Fair value of financial derivatives 3.2 4.0 + Difference between
Slide 11: TAG cost of debt and LTV
TAG cost of debt and LTV 11 11 Cost of debt Ø COST OF DEBT / LTV Continuous reduction of average cost of debt from FY 2014 onwards. Average cost of debt as of 30-Jun 2017 already 3.74% takes into account early refinancing of bank 3.45% Dessau 3.15% loans in July and August 2017 on a pro forma
Slide 12: TAG debt financing structure
TAG debt financing structure 12 12 Debt maturity profile as of 30 Jun-2017(1) Interest rates FINANCING STRUCTURE Corporate bonds EUR 435m (18%) Bank loans EUR 1,936m (82%) Ø interest rate: Total 4.52% Ø interest rate: financial debt 100% fixed rates 2.31% (1) EUR 2,371m 95% fixed rates Ø 2.72% 9
Slide 13: TAG portfolio Q2 2017
13 TAGTAG acquisitions portfolio Q2 2016 2017
Slide 14: TAG portfolio in total as of Jun-2017
TAG portfolio in total as of 30 Jun-2017 14 14 TAG is a leader in affordable housing in Northern and Eastern Germany. PORTFOLIO The portfolio is structured in ten defined regions in large and mid-sized cities. The management of these regions is conducted in a decentralized fashion. TAG’s loc
Slide 15: TAG strategy and strengths
TAG strategy and strengths 15 15 TAG is an expert in sourcing, acquiring and managing residential properties with a focus on Eastern and Northern Germany. TAG exhibits strong local presence in its core regions which allows for excellent market knowledge and efficient operation of properties. E
Slide 16: TAG vacancy reduction and rental growth
TAG vacancy reduction and rental growth 16 16 Vacancy development per region L-f-l rental growth per region (Y-o-Y) H1 2017 Q2 2017 PORTFOLIO 2016 2016 TAG Immobilien AG | August 2017 Basis l-f-l Including vacancy reduction
Slide 17: TAG valuation H1 2017
17 TAG TAG acquisitions valuation 2016 H1 2017
Slide 18: TAG H1 2017 valuation by CBRE
TAG H1 2017 valuation by CBRE 18 18 Main results of H1 2017 valuation carried out as of 30 Jun-2017 Key metrics Alignment in treatment of transaction cost with peer group due to increased VALUATION uncertainty of future treatment of share deals with respect to real estate Jun-2017 Sep-2016 Sep-201
Slide 19: TAG portfolio valuation details H1 2017
TAG portfolio valuation details H1 2017 19 19 Region Jun-2017 Jun-2017 Jun-2017 H1 2017 Share of Share of Change in H1 2017 Dec-2016 Dec-2016 Dec-2016 Fair value Fair value Implied Revaluation yield operational treatment of Net Fair value Fair value Implied (in EUR millions) (IFRS) (EUR/sqm) multipl
Slide 20: TAG acquisitions and disposals
20 TAG acquisitions and disposals TAG acquisitions 2016 H1 2017
Slide 21: TAG acquisitions H1 2017
TAG acquisitions H1 2017 21 21 Signing Brandenburg Saxony-Anhalt Saxony-Anhalt, Total ACQUISITIONS Feb-2017 Mar-2017 Lower Saxony, H1 2017 Thuringia Jun-2017 Units 1,441 1,252 1,445 4,138 Current net cold rent EUR/sqm/month 4.77 4.82 4.78 4.79 Brandenburg Vacancy 19.3% 7.2% 6.3% 11.1% Purchase price
Slide 22: TAG disposals H1 2017
TAG disposals H1 2017 22 22 Signing Brandenburg Freiburg Ongoing disposals Total Feb-2017 Jun-2017 H1 2017 H1 2017 DISPOSALS Units 535 457 221 1,213 Current net cold rent 3.61 6.21 --- --- EUR/sqm/month Brandenburg Vacancy 33.4% 0.0% --- --- Selling price 5.5 59.0 8.9 73.4 in EURm Current net cold r
Slide 23: TAG revised guidance FY 2017
23 TAG revised TAG acquisitions guidance 2016 FY 2017
Slide 24: TAG revised guidance FY 2017
TAG revised guidance FY 2017 24 24 FFO EUR 119m-121m after EUR 110m-112m (FY 2016: EUR 97m) mainly driven by GUIDANCE new acquisitions (less disposals) and strong operational performance in H1 2017, FFO main effects from refinancings will kick in from FY 2018 onwards. Guidance FY 2017 FFO/s EUR
Slide 25: Appendix
25 25 APPENDIX APPENDIX TAG Immobilien AG | August 2017
Slide 26: TAG portfolio details by region Q2 2017
TAG portfolio details by region Q2 2017 26 26 Region Units Rentable IFRS BV In- Vacancy Vacancy Current Re- L-f-l rental L-f-l rental Mainte- Capex # area EURm place Jun- Dec- net letting growth growth nance EUR/ sqm yield 2017 2016 cold rent y-o-y y-o-y incl. EUR/ sqm APPENDIX rent EUR/ vacancy sqm
Slide 27: TAG EPRA Earnings
TAG EPRA Earnings 27 27 (in EUR millions) Q2 2017 Q1 2017 Q4 2016 FY 2016 Net income 51.9 22.1 26.6 200.7 APPENDIX Valuation result -39.8 0.3 0.6 -163.1 Deferred income taxes on valuation result 9.1 3.7 -0.2 43.6 Net revenues from sales -0.5 -0.1 0.0 -1.8 Cash taxes on net revenues from sales 0.0 0.
Slide 28: TAG LTV calculation
TAG LTV calculation 28 28 APPENDIX (in EUR millions) 30 Jun-2017 31 Dec-2016 Non-current and current liabilities to banks 1,935.9 1,826.5 Non-current and current liabilities from corporate bonds 441.4 443.7 Cash and cash equivalents -50.7 -74.5 Net financial debt 2,326.6 2,195.7 Book value of invest
Slide 29: TAG capex and maintenance
TAG capex and maintenance 29 29 APPENDIX in EUR millions 2016 2017 Total portfolio Q1 Q2 Q3 Q4 Total FY Q1 Q2 Total H1 Maintenance 6.6 6.6 5.8 6.0 25.0 7.3 6.9 14.2 Capex 9.6 11.7 13.6 11.6 46.5 7.9 9.9 17.8 Total 16.2 18.3 19.4 17.6 71.5 15.2 16.8 32.0 in EUR/sqm 2016 2017 Residential units Q1 Q2 Q
Slide 30: TAG return on capex
TAG return on capex 30 30 Modernization is key element of TAG’s strategy Methodology APPENDIX Capex measures can be broken down into 1 Incremental revenues = Return on investment Modernization during re-letting Total investment (tenant turnover) Modernization of vacant flats 2 Incremental re
Slide 31: TAG return on capex
TAG return on capex 31 31 Total capex H1 2017: EUR 17.8m APPENDIX FY 2016: EUR 46.5m (FY 2015: EUR 40.1m) Single unit program Property based program (Equity financed) (Modernisation capex, partly debt financed) Share of total capex: c.75% in H1 2017 Share of total capex: c.25% in H1 2017 (c.56% in F
Slide 32: TAG shareholder structure
TAG shareholder structure 32 32 Shareholder structure as of 30 Jun-2017 Number of shares (issued) APPENDIX 146.5m Market capitalisation (30 Jun-2017) EUR 2.0bn Stock indices MDAX/EPRA Free Float * 100% National and international investors with long term investment strategy represent the ma
Slide 33: TAG management board
TAG management board 33 33 APPENDIX Claudia Hoyer Martin Thiel Dr. Harboe Vaagt COO CFO CLO Key responsibilities: Property and Key responsibilities: Controlling, Key responsibilities: Legal, Human Asset Management, Acquisitions and Accounting, Financing, Taxes, Resources and Transactions Dispo
Slide 34: TAG Contacts
34 34 TAG Contacts APPENDIX Martin Thiel Dominique Mann TAG Immobilien AG CFO Head of Investor & Public Relations Steckelhörn 5 Phone: +49 40 380 32-222 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 ir@tag-ag.com ir@tag-ag.com Fax: +49 40