Deutsche Wohnen Se · XETR:DWNI
Deutsche Wohnen — 9M 2011 Earnings Presentation
29 slides from Deutsche Wohnen's earnings presentation, Nov 14, 2011
Slide 1: Deutsche Wohnen AG 9m 2011 results
Deutsche Wohnen AG » 9m 2011 results Conference Call, 14 November 2011 1 1
Slide 2: Strategic overview
) a Deutsche Wohnen » Strategic overview deutsche-wohnen.com
Slide 3: Strategic overview (1/2)
» Strategic overview (1/2) Compelling overall strategy in dynamic markets • Strategy since 2007: Focus on top German metropolitan areas • Dec08A: 50.489 residential units; thereof ~ 86% in our core regions I. Portfolio • Dec11E: ~ 50.600 residential units; thereof ~ 92% in our core regions • Success
Slide 4: Strategic overview (2/2)
» Strategic overview (2/2) Realising economies of scale with accretive acquisitions • Accretive acquisitions • ~ 8,000 units accretively acquired, i.e. signed, since mid 2010 (100% in our core regions) • Net Initial Yield: 7.2%; above average NOI-margin (~ 80%) due to the realisation of economies of
Slide 5: Highlights 9m/2011
. ) a Deutsche Wohnen » Highlights 9m/2011 deutsche-wohnen.com
Slide 6: Strong 9m/2011 results in connection with accretive acquisitions
» Strong 9m/2011 results in connection with accretive acquisitions • Core letting portfolio • In-place rent: 5.59 EUR/sqm + 2.7% (like-for-like: + 3.4%) Performance • New-letting rent: 6.73 EUR/sqm + 4.0% (y-o-y) • Vacancy: 1.7% - 31% (like-for-like: - 31%) • Letting portfolio in Greater Berlin • In
Slide 7: Well managed portfolio in dynamic markets
» Well managed portfolio in dynamic markets 7
Slide 8: Well managed portfolio with organic growth potential
» Well managed portfolio with organic growth potential Residential Units Area Share of total In-place rent 1) New-letting rent 2) Vacancy portfolio Number k sqm % EUR/sqm EUR/sqm % Total 49,664 3,015 100% 5.51 2.9% Core regions 45,451 2,756 92% 5.59 2.3% Letting portfolio 40,382 2,430 82% 5.59 6.73
Slide 9: Valuation of our portfolio as at 30 September 2011
» Valuation of our portfolio as at 30 September 2011 Fair Value Multiple EUR m EUR/sqm In-place rent Market rent Total 2,841 921 14.0 12.5 Core regions 2,704 958 14.2 12.7 Greater Berlin 1,590 942 14.2 12.6 Frankfurt/Main 376 1,411 17.0 15.2 Rhine-Main 288 974 13.7 11.9 Rhine Valley South 265 850 13
Slide 10: Compelling like-for-like rental growth and strong rent potential
» Compelling like-for-like rental growth and strong rent potential like-for-like-comparison Rent In-place rent1) (EUR per sqm) potential2) 30/09/2011 30/09/2010 in % in % Letting portfolio in core regions 5.64 5.45 + 3.4% 20.4% Greater Berlin 5.51 5.29 + 4.2% 17.5% Frankfurt/Main 7.07 6.90 + 2.5% 20
Slide 11: Further improvement of operational performance and cash contribution
» Further improvement of operat. performance and cash contribution EUR m 9m/2011 9m/2010 Letting Current gross rental income 144.7 143.1 Non-recoverable expenses -4.4 -4.7 + 4.4% Rental loss -1.2 -1.6 Maintenance -20.1 -21.8 Others -0.6 -1.6 Earnings from Residential Property Management 118.4 113.4
Slide 12: Acquisitions of ~8,000 units in core regions since July 2010
» Acquisitions of ~ 8,000 units in core regions since July 2010 Accretive acquisitions and realisation of economies of scale Acquisitions 2010 and 2011 Region Berlin Berlin Rhine-Main Rhine Valley Rhine Valley Total Letting Privatisation South North Portfolio Total units 4,145 1,867 466 350 1,160 7,
Slide 13: Strong privatisation business and successful non-core divestments
» Strong privatisation business and successful non-core divestments Signed in Signed privatisation (units and transaction 9m/2011 Units Transaction volume Fair value Gross margin volume) 75.9 m # EUR m EUR m EUR m % 56.1 m Privatisation 1,025 75.9 57.0 18.9 33% 49.4 m Bloc sales 1,630 57.7 58.4 -0.7
Slide 14: Nursing and Assisted Living
» Nursing and Assisted Living 9m/2011 9m/2010 Average occupancy EUR m EUR m Income Nursing 25.3 24.9 Living 2.2 2.4 Other 3.0 2.8 30.5 30.1 Costs Nursing and corporate expenses -8.5 -8.4 Staff expenses -14.7 -14.6 -23.2 23.0 Segment‘s earnings 7.3 7.1 Attributable current interest expenses -2.0 -2.1
Slide 15: Enhanced results and strong financial profile
» Enhanced results and strong financial profile 15
Slide 16: EBITDA increased by 4.0% (y-o-y)
» EBITDA increased by 4.0% (y-o-y) EUR m 9m/2011 9m/2010 Earnings from Residential Property Management 118.4 113.4 Earnings from Disposals 7.2 8.8 Earnings from Nursing and Assisted Living 7.3 7.1 Segment contribution margin 132.9 129.3 Corporate expenses -23.0 -22.5 Other operating expenses/income
Slide 17: Adjusted EBT increased by 40% (y-o-y)
» Adjusted EBT increased by 40% (y-o-y) EUR m 9m/2011 9m/2010 Further reduction of interest expenses as a result of the debt structure EBITDA 108.8 104.6 optimisation in 2010 Depreciation -2.5 -2.4 Taxes affected by higher deferred taxes Financial result (net) -68.7 -75.3 (+ EUR 4.0 m) EBT adjusted
Slide 18: Recurring FFO further increased by 40% y-o-y
» Recurring FFO further increased by 40% y-o-y FFO-calculation FFO1) + 73% + 26% EUR m 9m/2011 9m/2010 Profit 19.7 10.1 47.3 EUR m Earnings from Disposals -7.2 -8.8 0.58 Depreciation 2.5 2.4 37.7 Valuation SWAP 0.2 2.4 27.4 0.46 Non-cash financial expenses 9.3 11.2 Deferred taxes 15.6 11.6 0.34 FFO
Slide 19: Balance sheet – Assets
» Balance sheet – Assets EUR m 30/09/2011 31/12/2010 Investment properties 2,895.7 2,821.0 Unchanged valuation matrix Other non current assets 20.4 20.5 Derivatives 0.0 9.2 Deferred tax assets 74.1 78.7 Due to acquisition of residential units held for privatisation Non current assets 2,990.2 2,929.4
Slide 20: Balance sheet – Liabilities
» Balance sheet – Liabilities + Profit EUR 19.7 m - Cash flow hedge EUR 16.7 m EUR m 30/09/2011 31/12/2010 + Pensions EUR 1.7 m - Dividend EUR 16.4 m Total equity 878.2 889.9 Increase of LTV to 62.1% due to acquisitions Financial liabilities 1,909.4 1,784.5 Tax liabilities 58.6 63.9 Including EK 02:
Slide 21: Banks show strong interest to finance DW
» Banks show strong interest to finance DW Letting portfolio Privatisation Total 1) Status of mortgage debt: 100% of debt terms committed Gross asset value (EURm) 331.9 75.5 407.4 1) Mortgage debt 215.0 50.0 265.0 LTV 65% 66% 65% Margin (bps) ~ 135 ~ 240 ~ 150 Interest rate 2) (incl. margin and hedg
Slide 22: LTV increased to 62.1% due to acquisitions; average interest 4.08%
» LTV increased to 62.1% due to acquisitions; Ø interest: 4.08% Financial liabilities in EUR m Mark-to-market 1,909.4 Debt structure LTV (%) 62.1 Nominal value 2,015.0 LTV (%) 65.6 Average interest rate: ~ 4.08 % Average mandatory redemption p.a.: ~ 1.6 % Debt service Average weighted maturity ~ 9.4
Slide 23: Outlook
» Outlook deutsche-wohnen.com . 23
Slide 24: Guidance of recurring FFO: at least EUR 45m (EUR 0.55 per share)
» Guidance of recurring FFO: at least EUR 45 m (EUR 0.55 per share) Strong performance in 9m/2011 and an continued positive residential market environment lead to a guidance of FFO (w/o disposals) for financial year 2011 of at least EUR 0.55 per share > This corresponds to an increase of at least 37
Slide 25: Appendix
» Appendix deutsche-wohnen.com . 25
Slide 26: Management team
» Management team “We are committed to combine value and sustainable growth while moving forward Deutsche Wohnen as the leading residential property company in Germany” Michael Zahn Helmut Ullrich Lars Wittan Chief Executive Officer Chief Financial Deputy Chief Officer Financial Officer 19 years of
Slide 27: Ongoing strong NOI performance per sqm
» Ongoing strong NOI performance per sqm Residential Property Management: NOI per sqm and month1) 9.4% 4.00 3.90 3.80 EUR/sqm 3.70 5.6% 3.94 3.60 3.6% 3.73 3.50 3.60 3.40 Monthly average Monthly average Monthly average 9m/2009 9m/2010 9m/2011 1) NOI: Net Operating Income of the period divided by mon
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, development or perform
Slide 29: Deutsche Wohnen AG contact details
Deutsche Wohnen AG Head Office Berlin Office Pfaffenwiese 300 Mecklenburgische Straße 57 65929 Frankfurt am Main 14197 Berlin Telefon: 030 897 86 551 Telefax: 030 897 86 507 © 2011 Deutsche Wohnen AG 29