Deutsche Konsum Real Estate Ag · XETR:DKG
Deutsche Konsum Real Estate — Deutsche Konsum REIT-AG — H1 2018/2019 Earnings Presentation
45 slides from Deutsche Konsum Real Estate's earnings presentation, May 15, 2019
Slide 1: Earnings Presentation H1 2018/2019
1 Earnings Presentation H1 2018/2019 1 October 2018 to 31 March 2019 15 May 2019 H1 2018/2019 Earnings presentation | Deutsche Konsum REIT-AG
Slide 2: Content
Content 2 Summary of the H1 2018/2019 Real Estate Portfolio – Key figures, recent developments, tenancy and valuation potential Financial structure Financials H1 2018/2019 DKR shares, analysts, guidance and dividend policy Financial calendar FY 2018/2019 Appendices Strategy Management External partn
Slide 3: H1 2018/2019 results at a glance
3 H1 2018/2019 results at a glance 3 H1 2018/2019 Earnings presentation | Deutsche Konsum REIT-AG
Slide 4: Financial key figures
Financial key figures 4 H1 financial figures show strong an steady growth Rental income (kEUR) FFO (kEUR) FFO per share (EUR) 25,000 15,000 12,681 0,5 19,472 0.43 20,000 10,000 0,4 7,263 15,000 12,489 5,000 65% 0,3 0.28 10,000 58% of RI of RI 5,000 0,000 0,2 H1 2017/2018 H1 2018/2019 H1 2017/2018 H1
Slide 5: Retail property portfolio
5 Retail property portfolio 5 H1 2018/2019 Earnings presentation | Deutsche Konsum REIT-AG
Slide 6: Property portfolio
Property portfolio 6 Key portfolio figures as at 31 March 2019 Annualised rent (mEUR) Vacancy (%) >> Portfolio snapshot 45 10 9.6 ➢ Key portfolio figures based on 106 properties 39.8 accounted as at 31.03.2019 40 35.5 9 8.7 ➢ Portfolio GAV of about 475 mEUR 35 ➢ Vacancy level mainly dropped due to t
Slide 7: Property map
Property map 7 121 properties with 683k sqm lettable space and 540m EUR GAV >> DKR’s top assets > 10 mEUR asset fair value as at 31.03.2019: City Lettable Acquisi Annual Fair value Valuation space tion by rent (mEUR) gain since (sqm) DKR (mEUR) acquisition (%) 1 Erfurt 16,920 2015 2.2 31.0 +44 2 Lei
Slide 8: Portfolio map of properties
8 Oer-Erkenschwick Weißwasser „Südpassage“ Bitterfeld „BiTZ“ Meißen Erfurt Elsterwerda „Elster Center“ Portfolio as at 31.03.2019 (106 properties) Transfers of ownership occured after 31.03.2019 (3 properties) Acquired assets with outstanding transfer of ownership (12 properties) Leipzig „Löwenpark“
Slide 9: Selection of latest property acquisitions (1)
Property portfolio 9 Selection of latest property acquisitions (1) >> H1 2018/2019 total investment volume amounts to 122 mEUR: Location Grevenbroich II – Montanushof Stendal – Altmarkt Forum Leipzig Portitz-Treff (Northrhine-Westphalia) (Lower Saxony) (Saxony) Space (sqm) 28,238 12,115 7,417 Annual
Slide 10: Selection of latest property acquisitions (2)
Property portfolio 10 Selection of latest property acquisitions (2) >> H1 2018/2019 total investment volume amounts to 122 mEUR: Location Wunsiedel Wurzen Mülsen St. Jacob (Bavaria) (Saxony) (Saxony) Space (sqm) 2,493 1,210 1,196 Annualised rent (kEUR) 234 138 145 Main tenants Norma, K+K Schuhe Disk
Slide 11: Tenant mix
Tenant mix 11 High quality tenants and circa 67% non-cyclical rents >> Rent contribution by sector (mEUR)1: >> Annualised rent contribution by major tenants1 : Rents WALT in Tenant group Brands (mEUR) years Edeka Group 6.7 7.0 Schwarz Group 6.9 5.8 Other cyclical uses 10.2 Metro Group 3.2 7.5 Bartel
Slide 12: Leases
Leases 12 DKR as a reliable partner for long-lasting tenancies >> Multiple leases with the same tenants1: >> Annualised rents allocated to years of lease contract maturities of the portfolio1: 45 40 25.000.000,00 2 35 7 No. of lease contracts 20.000.000,00 Rent p.a. EUR 30 3 4 25 15.000.000,00 19 6
Slide 13: Valuation potential
Valuation potential 13 Share price currently trades at a 7.1% yield >> NAV impact derived from factor increases (c.p.) leads to upside potential: Hypothetic Annualised total Hypothetical Portfolio value Net debt NAV Number of al NAV per portfolio rent valuation Yield Net LTV (mEUR) outstanding (mEUR
Slide 14: Financial structure
14 Financial structure 14 H1 2018/2019 Earnings presentation | Deutsche Konsum REIT-AG
Slide 15: Financial structure
Financial structure 15 Solid and efficient debt structure >> Financial KPIs: 31.03.2019 30.09.2018 % Debt allocation (mEUR initial nominal debt) Corporate Bond 40.0 37.0 Total financial debt (loans / bonds / convertible bonds), mEUR 254.6 231.6 +10 Convertible bond II Average nominal interest of loa
Slide 16: Financial structure
Financial structure 16 Reduced interest costs while solvency has strongly increased >> Development of debt metrics over the last 24 months: Average duration ICR LTV Average interest rate 60 6 50 5 40 4 30 3 20 2 10 1 0 0 31.03.2017 30.06.2017 30.09.2017 31.12.2017 31.03.2018 30.06.2018 30.09.2018 31
Slide 17: Financials H1 2018/2019
17 Financials H1 2018/2019 17 H1 2018/2019 Earnings presentation | Deutsche Konsum REIT-AG
Slide 18: Condensed IFRS balance sheet
Financials H1 2018/2019 18 Condensed IFRS balance sheet kEUR 31.03.2019 30.09.2018 kEUR 31.03.2019 30.09.2018 Assets Equity and liabilities Pro forma portfolio Investment properties 474,755.4 418,707.3 Subscribed capital 29,959.9 27,236.3 Increased equity due currently mEUR 540 (including the latest
Slide 19: LTV and EPRA NAV
Financials H1 2018/2019 19 LTV and EPRA NAV >> LTV (loan-to-value): >> EPRA NAV: 31.03.2019 30.09.2018 kEUR 31.03.2019 30.09.2018 kEUR Bank loans 169,842.3 155,223.0 Total equity 244,990.9 209,762.4 Convertible bonds 35,871.3 36,098.9 Conversion of convertible bonds 0.0 0.0 Corporate bond 40,520.2 4
Slide 20: Condensed IFRS income statement
Financials H1 2018/2019 20 Condensed IFRS income statement kEUR 01.10.2018 01.10.2017 % – – 31.03.2019 31.03.2018 Rental income 19,471.9 12,489.5 55.9 Rental income has mainly increased in the course Income from recharched operating costs1 3,405.7 1,060.9 >100.0 of the property portfolio growth Oper
Slide 21: FFO reconciliation
Financials H1 2018/2019 21 FFO reconciliation >> FFO/aFFO: kEUR 01.10.2018 01.10.2017 % – – 31.03.2019 31.03.2018 Total period income 11,484.7 6,364.3 80.5 +/- Income taxes 0.0 10.5 0.0 + Depreciation of other assets 0.6 0.5 20.0 +/- Gain/loss from remeasurement of 0.0 0.0 0.0 investment properties
Slide 22: DKR shares
22 DKR shares 22 H1 2018/2019 Earnings presentation | Deutsche Konsum REIT-AG
Slide 23: DKR shares
DKR shares 23 DKR shares reflect the scalability of the business model >> DKR shares: 14.05.2019 ISIN DE000A14KRD3 WKN A14KRD3 Symbol DKG Number of shares 29,959,944 Nominal capital (kEUR) 29,959 Share class Bearer shares Stock exchanges XETRA, Frankfurt, Berlin Segment Prime Standard Indizes Prime
Slide 24: Analyst research
DKR shares 24 Analyst research >> Analyst coverage: Publication date Bank Analyst Recommendation Price target 30 April 2019 Kai Klose „Buy“ EUR 13.70 11 April 2019 Dr. Georg Kanders „Buy“ EUR 12.50 21 February 2019 Thomas Effler „Buy“ EUR 12.80 H1 2018/2019 Earnings presentation | Deutsche Konsum RE
Slide 25: Stable shareholder structure
DKR shares 25 Stable shareholder structure >> DKR share developments in H1 2018/2019: >> Current shareholder structure (31 Mar 2019) : Carmignac Gestion Midgard Beteiligungsgesellschaft mbH/ 0.43 EFa Vermögensverwaltungs KG 0.75 ➢ Successful 10% share capital increase closed on 22 Nov 2018 Obotritia
Slide 26: Guidance and dividend outlook
26 Guidance and dividend outlook 26 H1 2018/2019 Earnings presentation | Deutsche Konsum REIT-AG
Slide 27: Outlook and guidance
Outlook and guidance 27 Outlook to Fiscal Year 2018/2019 >> FFO-Guidance for FY 2018/2019: ➢ DKR expects FFO between 26.0 mEUR and 29.0 mEUR ➢ FFO run rate of 33.0 mEUR by the end of FY 2018/2019 >> Dividend outlook for FY 2018/2019: ➢ Based on current projections we expect a dividend of 0.40 EUR pe
Slide 28: Financial calendar
28 Financial calendar 28 H1 2018/2019 Earnings presentation | Deutsche Konsum REIT-AG
Slide 29: Financial calendar
Financial calendar 29 DKR has intensified its roadshow presence in H1 2018/2019 >> Financial calendar: >> Upcoming events: Date Date Country 15.05.2019 Publication of the half-yearly financial report of 2018/2019 26.03.2019 Roadshow, Dublin financial year 27.03.2019 Roadshow, Munich 14.08.2019 Publi
Slide 30: Appendices
30 Appendices 30 H1 2018/2019 Earnings presentation | Deutsche Konsum REIT-AG
Slide 31: DKR at a glance
DKR at a glance 31 What is DKR about >> Growing BASIC RETAIL investor – biggest niche player in Germany: Retail property portfolio in established Defensive and solvent tenant mix Stock exchange listed investor Solid and efficient funding micro locations • 121 retail properties • Food-anchored and no
Slide 32: Business Model & Strategy: Investment approach
Business Model & Strategy 32 Investment approach >> Growing BASIC RETAIL investor – biggest niche player in Germany: WALT 5 Yield 10 Highly fragmented niche to be consolidated Accepting short WALTs High-speed acquisition process Value enhancing asset management • DKR buys out of equity which is • In
Slide 33: Bundling single properties into an institutional asset class
Business Model & Strategy 33 Bundling single properties into an institutional asset class Owner B Owner C Owner A Owner D Owner E Owner F Owner: Deutsche Konsum REIT ➢ Strong and effective risk diversification of single properties by bundling them into a portfolio ➢ Synergies and stronger position t
Slide 34: Basic retail sector remains stable with best outlook
Business Model & Strategy 34 Basic retail sector remains stable with best outlook >> Main statistical data according to latest sector analysis 20171: 4.2 % 124m Growth of the sqm stationery retail Total retail lease in 2017 area in Germany • Strong German economy and increasing • Market share of DKR
Slide 35: Basic retail threatened less by E-Commerce (1)
Business Model & Strategy 35 Basic retail threatened less by E-Commerce (1) >> Market research according to 13. Retail Real Estate Report Germany 2018/2018 by bulwiengesa / Hahn1: fig. 3 fig. 4 Results of the statistical data: • Food sector and other goods of daily needs (basic retail) are hardly im
Slide 36: Basic retail threatened less by E-Commerce (2)
Business Model & Strategy 36 Basic retail threatened less by E-Commerce (2) >> Market research according to 13. Retail Real Estate Report Germany 2018/2018 by bulwiengesa / Hahn1: fig. 1 fig. 2 Results of the statistical data: • Yearly growth rate of general E-Commerce swings around 10% and grows es
Slide 37: Basic retail threatened less by E-Commerce (3)
Business Model & Strategy 37 Basic retail threatened less by E-Commerce (3) >> Biggest grocery delivery services compared to DKR property portfolio • DKR portfolio with low overlapping with regions serviced by fresh food deliverers • In 2017 E-Commerce in the grocery business remained at a very slig
Slide 38: Sourcing process for retail properties
Acquisition process 38 Sourcing process for retail properties Private owners Funds in liquidation Remaining due to age properties of of investors portfolio transactions Deep asset analysis before Public acquisition auctions DKR Tenants network Brokers • Investment team analyses a yearly property vol
Slide 39: Management
Management 39 Experienced and committed management Alexander Kroth (CIO) Rolf Elgeti (CEO) Christian Hellmuth (CFO) Alexander joined DKR in January 2017 and initially Rolf has been the founder of Deutsche Konsum REIT-AG, which is Christian joined DKR in January 2017 and is set up the company togethe
Slide 40: Partners
Partners 40 Strong external property partners >> DKRs main external management partners: Asset Managers Elgeti Brothers Property Managers Technical Property Developer IT and Management Software Providers H1 2018/2019 Earnings presentation | Deutsche Konsum REIT-AG
Slide 41: Value add by extensive property redevelopments
Revitalisiation 41 Value add by extensive property redevelopments >> Current major revitalisation projects: Location Domcenter Location Kirschbergcenter Location Kolumbuspassage Location Lindencenter Greifswald Hohenmölsen Rostock Stralsund Space (sqm) 9,410 Space (sqm) 7,797 Space (sqm) 4,492 Space
Slide 42: Portfolio overview
Portfolio overview 42 DKRs detailed property portfolio Please find DKR‘s current portfolio in a detailed overview online under the following link: DKR property portfolio overview as at 31 March 2019 H1 2018/2019 Earnings presentation | Deutsche Konsum REIT-AG
Slide 43: Glossary
Glossary 43 >> Calculation of financial figures: Financial KPI Calculation Average debt interest rate Weighed average interest rates of financial instruments divided by nominal financial debt EPRA NAV per share Total equity modified according to EPRA guidelines divided by number of shares FFO Funds
Slide 44: IR contact
IR contact 44 Please get in touch >> IR contact: Stefanie Frey August-Bebel-Str. 68 14482 Potsdam sf@deutsche-konsum.de + 49 (0331) 740 076 533 H1 2018/2019 Earnings presentation | Deutsche Konsum REIT-AG
Slide 45: Disclaimer
Disclaimer 45 The material in this presentation has been prepared by Deutsche Konsum REIT-AG (Deutsche Konsum) and is general background information about Deutsche Konsum’s activities current as at the date of this presentation. This information is given in summary form and does not purport to be co
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