Branicks Group Ag · XETR:BRNK
Branicks — DIC Asset — Investor Presentation (November 2012)
46 slides from Branicks's investor presentation, November 2012
Slide 1: Company Presentation DIC Asset AG
COMPANY PRESENTATION DIC ASSET AG NOVEMBER 2012
Slide 2: DIC:
DIC:
Slide 3: Company Profile, Portfolio, Financials 9M 2012, Appendix
1. COMPANY PROFILE 2. PORTFOLIO 3. FINANCIALS 9M 2012 4. APPENDIX 3
Slide 4: Investment Case
INVESTMENT CASE Pure play German commercial real estate Pure play German commercial real estate with currently € 3.3 bn assets under management Well-balanced business model with steady and high quality income: − Regionally diversified Commercial Portfolio with long lease maturities and high rental y
Slide 5: Highlights 9M 2012
HIGHLIGHTS 9M 2012 Steady growth of earnings Gross rental income Ongoing strong letting result reduced vacancy rate in € mn by 0.3 percentage points to 11.7% 94.3 85.8 Gross rental income increased by +10% to € 94.3 mn 31.5 31.8 FFO raised by 8% to € 32.2 mn thanks to larger portfolio and successful
Slide 6: German Economic Performance
GERMAN ECONOMIC PERFORMANCE German economy in top position in Europe GDP growth rates 2012 in Europe Germany biggest and most diversified real estate in %, expected market in Europe with high legal, social and political stability German GDP: moderate growth of +0.8% for 2012 expected, but prediction
Slide 7: German Real Estate Market
GERMAN REAL ESTATE MARKET German real estate market stable, but with more cautious outlook JLL office property clock Q3 2012 Letting result 9M 2012 of 2.2 mn sqm (-14%) in major locations, for 2012 minus 16% vs. 2011 is expected Vacancy rates are still decreasing in all major locations thanks to low
Slide 8: Company Profile, Portfolio, Financials 9M 2012, Appendix
1. COMPANY PROFILE 2. PORTFOLIO 3. FINANCIALS 9M 2012 4. APPENDIX 8
Slide 9: Balanced Business Model
BALANCED BUSINESS MODEL Full spectrum of investment profiles 1,2 Commercial Co- Percentage of rental space Portfolio 88% 12% Investments 1,919,948,200 Market value in € mn 326,874,000 157 Number of properties 113 127,714,333 Annualised rental income in € mn 15,744,333 10.77 Rental income per sqm in
Slide 10: Portfolio by Regions (I)
PORTFOLIO BY REGIONS (I) Well diversified all over Germany with local expertise Portfolio by regions 1 Strong footstep in German market with € 3.3 bn based on sqm assets under management (thereof € 2.2 bn on DIC Asset balance sheet ) Diversified investments over Germany: Around 270 properties both i
Slide 11: Portfolio by Regions (II)
PORTFOLIO BY REGIONS (II) Management focus on regional performance 1,2 Major changes in 9M 2012 against 9M 2011: − North: Strong reduction of vacancy rate by -4 pp with several new lettings − East: Portfolio strenghtened through acquisitions in Berlin: rental income up by € 6 mn − West: Vacancy rate
Slide 12: Portfolio Diversification
PORTFOLIO DIVERSIFICATION Risk diversified and long leased portfolio Tenants by industry sector 1 Stable and high cash flow quality through well in % Small/medium-sized balanced sector and tenant structure companies and others 31% Around 1,400 commercial tenancies, thereof one third Public sector In
Slide 13: Letting Performance
LET TING PERFORMANCE Ongoing strong letting results Letting volume Letting volume of 173,000 sqm as planned in tsqm (9M 2011: 202,000 sqm), Q3 12 with slight increase 202 Strong new letting result of 82,000 sqm supports 173 increasing occupancy rate 52 60 61 Renewals of 91,000 sqm according to plan
Slide 14: Portfolio Quality
PORTFOLIO QUALIT Y Vacancy rate further reduced Vacancy rate 1 Vacancy rate again reduced to 11.7% (-0.3 pp) in % of sqm due to letting results (Q3 2011: 13.5%); clearly 14.3 13.8 13.5 below 5-year-average of 13% 12.4 12.3 12.0 11.7 13.0 Like-for-like rental income growth with +0.6% against end of 2
Slide 15: Acquisitions
ACQUISITIONS Acquisition volume at €113 mn For “Commercial Portfolio”: well occupied multi-tenant office property in Frankfurt at main station (€ 17 mn investment volume) acquired Target of fund investment volume in 2012 with approx. € 95 mn already achieved: − Office property„Loftwerk“ (€ 44 mn) Of
Slide 16: Sales Performance
SALES PERFORMANCE Strong increase of sales volume Sales volume Integral part of DIC Asset’s business strategy for: in € mn 132 − diversification and optimisation of 101 portfolio structure (regional and usage focus) 72 60 − debt reduction and cash release − realising profits 09 10 11 ytd 12 Sales vo
Slide 17: Bienenkorbhaus – Successful Redevelopment
Portfolio Highlights BIENENKORBHAUS – SUCCESSFUL REDEVELOPMENT Profitable exit after redeveloping and repositioning of a prime high-street property Value creation with transformation to prime retail: 15% more letting space, rental income nearly doubled End of 2011: 100% ownership by DIC Asset AG Tot
Slide 18: MainTor – The Riverside Financial District
MAINTOR - THE RIVERSIDE FINANCIAL DISTRIC T New open and modern riverside urban quarter in a prime city location WinX - approx. 35,000 sqm MAINTOR PRIMUS - Focus on marketing MAINTOR PORTA Urban development potential of existing from H2 2013 - approx. 5,500 sqm - approx. 20,500 sqm assets raised in
Slide 19: MainTor Frankfurt
MAINTOR FRANKFURT Where are we coming from? Finalising master plan in detail Start of MainTor project, after former tenant Evonik left the quarter Attention building through marketing and special events Risk diversification through separated and different construction phases Realisation of early pre
Slide 20: MainTor Frankfurt
MAINTOR FRANKFURT What have we done since 2011? Summer 2011: Anniversary show of “Museum für Moderne Kunst” on the MainTor site draws over 110,000 visitors to the exposition June 2011: Forward sale of “MainTor Primus”, which will become DIC’s headquarter Start of the demolition at the whole area and
Slide 21: MainTor Frankfurt
MAINTOR FRANKFURT What’s next? MainTor progress far ahead of time: approx. € 340 mn (more than 50%) in realisation 2012 Start of marketing for selling condominiums of “MainTor Palazzi” to owner-occupiers and private investors in December 2012 (investment volume approx. € 75 mn) In the next 12 months
Slide 22: Fund Business
FUND BUSINESS Further growth of fund business Steady earnings: real estate management fees (9M 12: € 1.1 mn) and profits from associates via 20% co-investment (9M 12: € 1.4 mn) With € 365 mn already more than 50% of planned fund volume invested (up to around € 700 mn) DIC HighStreet Balance: − first
Slide 23: Company Profile, Portfolio, Financials 9M 2012, Appendix
1. COMPANY PROFILE 2. PORTFOLIO 3. FINANCIALS 9M 2012 4. APPENDIX 23
Slide 24: Financial Focus
FINANCIAL FOCUS Further attractive financings for acquisitions arranged with cost of debt below average; platform of banks and financing partner broadened Average interest rate further down to 4.10% Repayment of former acquisition financing for„MainTor Porta“ of around €30 mn; flexible development f
Slide 25: Overview Consolidated Profit and Loss Account
OVERVIEW CONSOLIDATED PROFIT AND LOSS ACCOUNT € mn 9M 2012 9M 2011 change Q3 2012 Q2 2012 change Gross rental income 94.3 85.8 +10% 31.8 31.4 +1% Net rental income 84.4 78.8 +7% 28.3 28.0 +1% Administr./Personnel expenses -15.4 -13.3 +16% -5.4 -4.8 +13% Management fee income 3.6 3.6 +0% 1.3 1.1 +18%
Slide 26: Revenues
REVENUES Higher rental income Total revenues Gross rental income Gross rental income increased by +10% to € 94.3 mn in € mn in € mn (9M 2011: € 85.8 mn) due to more lettings and larger portfolio 111.1 120.4 94.3 85.8 Net rental income accounts for with € 84.4 mn (9M 2011: € 78.8 mn), a plus of 7%, s
Slide 27: Cost Structure
COST STRUC TURE Operating costs within target range Operating costs & fees from real estate management Personnel and administrative cost increase by in € mn € 2.1 mn (+16%) to € 15.4 mn as planned Higher personnel costs after staff increase due to higher operations, especially in funds business 7.1
Slide 28: Interest Result
INTEREST RESULT More interest expenses due to portfolio growth Interest result Interest result in 9M 2012 at € -42.5 mn, only slightly in € mn -50.0 higher than last year (9M 2011: € -41.0 mn) despite -46.6 -41.0 -42.5 higher portfolio volume Interest expenses higher at € -50.0 mn (+7%) due to 5.6 7
Slide 29: Earnings
EARNINGS FFO increased by 8% FFO 1 Higher FFO with € 32.2 mn, increased by € 2.4 mn (+8%); in € mn slight increase in Q3 12 up to € 10.9 mn 29.8 32.2 Higher profit from disposals € 0.7 mn despite lower proceeds compared to 9M 2011 (€ 0.6 mn) 10.8 10.9 Profit for the period at € 7.6 mn (9M 2011: € 8.
Slide 30: Cash Flow
CASH FLOW Higher operating cash flow Cash generated from operations Cash generated from operations at € 79.3 mn, in € mn above previous year due to higher operating income (9M 2011: € 71.8 mn) 71.8 79.3 Cash flow from operating activities significantly increased by € 3.5 mn (+11%) to € 35.6 mn Cash
Slide 31: Balance Sheet
BALANCE SHEET Overview 9M 2012 2011 change Non-current assets 1,970.5 1,997.3 -1% Current assets 284.4 250.8 +13% 2,254.9 2,248.1 0% Equity 609.4 624.2 -2% Non-current liabilities 1,304.6 1,406.7 -7% Current liabilities 340.9 217.2 +57% 2,254.9 2,248.1 0% Balance sheet equity ratio in % 27.0% 27.8%
Slide 32: Financial Debt
FINANCIAL DEBT Balanced financial structure Debt maturities Balance sheet equity ratio at 27.0% (31.12.2011: 27.8%), in %, as of 30 September 2012 net debt equity ratio at 30.5% (31.12.2011: 31.7%) >5y: 4-5y: 3% 13% Long-term, non-recourse financings at property level with 3-4y: well diversified por
Slide 33: Outlook 2012
OUTLOOK 2012 On the way to meet our targets Progress Internal growth: further reduction of vacancy rate to around 11.5% Asset & Property Management until year-end - rental income in range of € 124-126 mn External portfolio growth: acquisitions in all business segments Acquisitions of up to € 150 mn
Slide 34: Company Profile, Portfolio, Financials 9M 2012, Appendix
1. COMPANY PROFILE 2. PORTFOLIO 3. FINANCIALS 9M 2012 4. APPENDIX 34
Slide 35: Shareholder Structure
SHAREHOLDER STRUC TURE DIC Asset share listed in the SDAX and EPRA Developed Europe Index Analyst Coverage Total shares: 45,718,747 - main shareholders currently by 15 financial institutions are long-term investors Buy 13 Dividend of € 0.35 for financial year 2011, thereof around 52% tax-free Hold 2
Slide 36: Longtime Sector Expertise
LONGTIME SECTOR EXPERTISE Ulrich Höller FRICS (46) Markus Koch (49) CEO at DIC Asset since 2002 CFO at DIC Asset since 2003 Company Strategy Finance Investment (Sales & Acquisitions) Controlling & Treasury Portfolio Management Risk Management Business Administration Graduate, specialist in Real Esta
Slide 37: Organizational Structure
ORGANIZATIONAL STRUC TURE DIC Asset AG Management Board U. Höller (CEO) - M. Koch (CFO) Investment Group Management 5 employees 11 employees - Acquisitions & Sales - Business Development & - Due Dilligence Corporate Strategy - Business plan modelling - Investor Relations & Marketing - Legal structur
Slide 38: Opera Offices Hamburg
OPERA OFFICES HAMBURG Modern office complex in Hamburg‘s opera district Two subprojects “Opera Offices Klassik” (refurbishment) and “Opera Offices Neo” (new construction) with project volume of around € 55 mn at an attractive and prime city location THE MAINTOR PORTA Increase in value with completio
Slide 39: Portfolio Overview 9M 2012
PORTFOLIO OVERVIEW 9M 2012 Commercial Portfolio 1,2 Co-Investments 1,2 Number of properties 158 Number of properties 113 Lettable space (sqm) 1,089,116 Lettable space (sqm) 150,556 Gross rental income (€ mn p.a.) 127.7 Gross rental income (€ mn p.a.) 15.7 Average rent per sqm (€ per sqm) 10.77 Avera
Slide 40: Net Asset Value
NET ASSET VALUE NAV per share stable at around € 15 NAV bridge 1,2 Positive valuation effect 2011: in € per share +0.7% based on annual external 15.27 + 0.04 14.93 valuation + 0.67 14.82 14.22 + 0.35 Total portfolio value at € 2,202 mn; - 1.05 - 0.35 Net increase of portfolio volume by € 222 mn due
Slide 41: Portfolio Profile by Usage 9M 2012
PORTFOLIO PROFILE BY USAGE 9M 2012 Letting volume Average lease maturity In tsqm in years, related to rental income 173 7 120 5 5 5.2 4 15 27 11 Office Retail Logistics/ further Total Office Retail Logistics/ further Total warehouses commercial warehouses commercial and other and other Average rent
Slide 42: Portfolio Track Record
PORTFOLIO TRACK RECORD Letting volume Average lease maturity In tsqm in years, related to rental income 246 257 247 196 6.0 5.4 5.6 5.4 5.5 124 07 08 09 10 11 07 08 09 10 11 Average rent per sqm Vacancy rate in € in % of sqm 14.3 10.20 10.50 10.40 10.40 10.50 13.3 12.0 12.4 11.0 07 08 09 10 11 07 08
Slide 43: Notes
43 NOTES DIC:
Slide 44: Notes
44 NOTES DIC:
Slide 45: Getting in Touch
GET TING IN TOUCH Immo von Homeyer DIC Asset AG Eschersheimer Landstraße 223 Head of Investor Relations & Corporate Communications 60320 Frankfurt am Main phone: (+49) (0)69-27 40 33-86 e-Mail: i.vonhomeyer@dic-asset.de phone: +49 69 9 45 48 58-0 fax: +49 69 9 45 48 58-99 e-Mail: ir@dic-asset.de Pee
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