Frankfurt, 09.02.2018
Frankfurt/Main, 9 February 2018. This Friday, DIC Asset AG
(German securities code number WKN A1X3XX / ISIN DE000A1X3XX4) presented
its figures for the 2017 financial year. The company looks back on
another banner year, having easily achieved the targets set for the key
performance indicators even after these had been raised in the course of
the year. The refinancing of the Commercial Portfolio that was
completed in late 2016, and the achieved investment income from WCM and
TLG Immobilien AG, are clearly reflected in a consolidated income that more than doubled at EUR 64.4 million (previous year, adjusted: EUR 26.9 million). At EUR 60.2 million, the FFO topped the prior-year figure (previous year: EUR 47.0 million) by 28
percent, substantially exceeding the forecast made at the beginning of
the year. The successful internal provision of the management platform
for proprietary and for third-party real estate produced solid funds from operations in 2017 as in the previous year. The letting performance of the overall
portfolio rose by c. EUR 8 million year on year to a total of EUR 40.2
million, while the weighted average lease term (WALT) increased
from 4.3 years to now 5.2 years. With the assets from the third-party
property management taken into account, the assets under management (AuM) came to EUR 4.4 billion as of 31 December 2017. With a view to
the successful financial year, the Management Board of DIC Asset AG
intends to propose a special dividend of EUR 0.20 in addition to another increase in dividend to EUR 0.44 per share for 2017 to the Annual General Meeting on 16 March 2018. This will bring the dividend yield up to 6.1 percent relative to the year-end share price of 2017.
"2017 was very successful financial year for us. The significant improvement in the net interest result and our successes in portfolio management - including for third parties -have had a very positive effect on the FFO and cash flow, while our equity interest in WCM generated one-off income as a result of the takeover by TLG. We intend to let our shareholders participate in both developments by raising the dividend and by disbursing a special dividend. For the first time, our shareholders will moreover have the choice of receiving their dividend either as cash payment or in the form of additional DIC share certificates. By offering this option, we not only show that ours has become a consistent dividend stock, but we also give our shareholders the chance to step up their participation in the future appreciation of the company by subscribing additional share certificates," said Sonja Wärntges, CEO of DIC Asset AG.
Vacancy Rate in the Commercial Portfolio below Ten Percent
The
"Commercial Portfolio" operating segment showed an extremely positive
performance in the course of the year. The application of internal asset
management helped us to bring down the vacancy rate successfully by 1.9 percentage points year on year to now 9.9 percent (previous year: 11.8 percent). The weighted average lease term (WALT) lengthened from 4.5 years to now 5.1 years. At the same time,
strategic sales helped to further optimise the Commercial Portfolio as
planned. Not least because of the great market environment, c. EUR 240
million worth of deals were transacted throughout the year as a whole.
By the end of the year, the company held EUR 1.6 billion in assets under management (previous year: EUR 2.0 billion) in this operating segment. Despite the large volumes of portfolio sales, the letting performance achieved the level of 2016 at EUR 16 million. The gross rental income exceeded the anticipated target range for 2017 at EUR 109.7 million,
and fell short of the prior-year figure by only a slight margin
(previous year: EUR 111.2 million). Like for like, the rental
income saw an increase by 1.4 percent. The successful reduction of
vacancies, the stable trend in rental income, and the permanently high
letting performance demonstrated once more the quality of DIC's
successful in-house letting management.
DIC Fund Products Established on the Market
Following
the placement of the DIC Office Balance IV during Q1 2017, and of the
DIC Retail Balance I during Q3 2017, DIC is currently represented on the
German market with six institutional real estate funds. The assets under management in the "Funds" operating segment added up to EUR 1.5 billion toward
year-end, an increase by 31 percent compared to the prior-year figure. Fees from real estate management in the fund business added up to EUR 18.9 million by the end of 2017, slightly topping the
level of the year before (previous year: EUR 18.8 million). "The fund
business showed an excellent performance during the year. The next
products are already in planning, and following the acquisition of three
office properties in December, our pipeline of warehoused assets is
quite adequately stocked for structuring new funds," said Wärntges.
Drastically Increased Contribution to Operating Income from the "Other Investments" Segment
Earnings from the "Other Investments" operating segment totalled EUR 28.3
million by the end of the year (previous year: EUR 2.6 million). By
exchanging its WCM shares for an equity interest in TLG Immobilien AG,
DIC Asset AG collected EUR 19.3 million in one-off income, part
of which is to be disbursed to the shareholders in the form of a special
dividend. In addition, the WCM/TLG commitment paid an attractive EUR
3.7 million in current investment income. Following the expansion of the
third-party property management, this business division's assets under management (AuM) came to EUR 1.3 billion as of 31 December 2017. The withdrawal
from property developments and the complete wind-up of joint venture
participations continued as planned with more sales toward the end of
the year.
Net Interest Significantly Improved, Continued Reduction in LTV Ratio
The
company continues to optimise its financial structure in the course of
the year, and this, together with the refinancing already completed in
2016, improved the net interest result by 25 percent compared to
the adjusted prior-year result (EUR -46.7 million), bringing it up to a
total of EUR -35.1 million. The proceeds from a corporate bond in the
amount of EUR 130 million that was successfully placed during the second
half-year are used to repay current higher-interest debenture bonds,
and thereby to keep improving the capital structure of the company. As
of 31 December 2017, the average interest rate on bank debt was
1.8 percent, and thus 1.6 percentage points lower than it had been at
year-end 2016 (3.4 percent). At the same time, the loan-to-value ratio dropped further, and was down to 57.0 percent by the end of the year.
This implies a reduction by nearly 3 percentage points. The company's equity ratio increased by a significant 3.8 percentage points to 35.4 percent (previous year: 31.6 percent). The net asset value (NAV) equalled EUR 900 million at year-end (previous year: EUR 880 million).
The NAV per share equals EUR 13.12, up from EUR 12.83 the previous year.
Outlook for 2018
The
considerable increase in funds from operations (FFO) in 2017 reflects
the success of having continued to develop the internal property
management - including for third parties - and to optimise the funding
structure while also reflecting the growth of DIC Asset AG in the
investment fund business. DIC Asset AG will also enhance and optimise
its successful and unique hybrid model in 2018. The earnings from the
different segments Commercial Portfolio, Funds and third-party business
will be further expanded and strengthen the basis for result and FFO.
The company plans to keep diversifying its sources of income in the
future, to raise value-added potential, and to generate stable cash
flows. In 2018, the company is aiming for an acquisition volume between EUR 450 and 500 million across its three business divisions but
with a special focus on the fund business. At the same time, DIC
projects a volume of disposals in an amount of EUR 100 to 120
million to further optimise its Commercial Portfolio, and to exploit the
current market environment for disposals. With the transactions and the
planned letting performance duly taken into account, the company
expects to generate a gross rental income in the amount of EUR 95
to 98 million in 2018. Since the expansion of the property management
platform was completed in 2017, the operating expenses are expected to
decline slightly as a result of the growing fund business. The increase
in property management revenues caused by the growth in fund business is
likely to compensate the drop in rent revenues in the longer term.
Considering that the FFO in 2017 was characterised particularly
by the effect the refinancing arrangement had on the financial results,
DIC Asset AG expects to see slightly increased funds from operations in
an amount of EUR 62-64 million (c. EUR 0.90-0.93 per share) in 2018.
About DIC Asset AG:
DIC
Asset AG is one of Germany's leading listed property companies, and
specialises in commercial real estate With around 20 years of experience
on the German real estate market, the company maintains a regional
footprint on all major German markets through six branch offices, and
has around 180 assets with a combined market value of c. EUR 4.4 billion
under management. DIC uses a hybrid business model to manage its
business divisions Commercial Portfolio, Funds and Other Investments.
Taking an active asset management approach, DIC employs its proprietary,
integrated real estate management platform to raise capital
appreciation potential in its business divisions and to boost its
revenues.
In its Commercial Portfolio division (EUR 1.6 billion in assets under management), DIC acts as proprietor and property asset holder, and thus generates revenues both from the management of the assets and through the value optimisation of its own real estate portfolio. The Funds division (EUR 1.5 billion in assets under management) generates its revenues by acting as issuer and manager of special real estate funds for institutional investors. Gathered in the business unit Other Investments (EUR 1.3 billion in assets under management) are joint venture investments, equity investments in property developments, strategic financial investments, and the management of properties in which the company holds no equity stakes.
DIC
Asset AG has been included in the SDAX(R) segment of the Frankfurt
Stock Exchange since June 2006. The Company's shares are also included
in the EPRA index, which tracks the performance of the most important
European real estate companies.
Download Annual Report 2017 (PDF, 14 MB) >>
For more details on DIC Asset AG, visit the company’s homepage at www.dic-asset.de.
Investor Relations and Corporate Communications
DIC Asset AG
Nina Wittkopf
Head of Investor Relations and Corporate Communications
Neue Mainzer Straße 20 MainTor
60311 Frankfurt am Main
Phone +49 69 9454858-1462
Fax +49 69 9454858-9399
N.Wittkopf@dic-asset.de
DIC Asset AG at a Glance
Financial indicators, in mEUR |
2017 |
2016 |
Gross rental income |
109.7 |
111.2 |
Net rental income |
93.1 |
94.5 |
Fees from real estate management |
20.8 |
21.5 |
Property disposal proceeds |
229.5 |
318.1 |
Total income |
381.9 |
473.8 |
Profits on property disposals |
25.5 |
23.2 |
Net income from associates |
29.0 |
2.3 |
Funds from operations (FFO) |
60.2 |
47.0 |
EBITDA |
136.6 |
114.9 |
EBIT |
105.6 |
79.6 |
Consolidated income |
64.4 |
-29.4* |
*incl. one-off expenses in the amount of c. EUR 56 million |
|
|
Financial indicators per share in EUR |
2017 |
2016 |
EPRA earnings per share |
0.83 |
0.64 |
FFO per share |
0.88 |
0.69 |
Net asset value (NAV) per share |
13.12 |
12.83 |
Operating performance indicators |
2017 |
2016 |
Letting performance, in mEUR |
40.2 |
32.1 |
WALT in years |
5.2 |
4.3 |
Vacancy rate, in %* |
9.9 |
11.8 |
*Commercial Portfolio without warehoused assets and property developments
|
||||
Balance sheet ratios, in mEUR |
31/12/2017 |
31/12/2016 |
|
|
|
|
|
|
|
Investment property |
1,437.2 |
1,583.4 |
|
|
Shareholders' equity |
828.9 |
757.0 |
|
|
Financial debt |
1,405.7 |
1,450.4 |
|
|
Total assets |
2,341.3 |
2,395.5 |
|
|
Balance sheet equity ratio, in % |
35.4 |
31.6 |
|
|
Loan-to-value ratio (LTV), in % |
57.0 |
59.9 |
Deutsche Immobilien Chancen AG & Co. KGaA
Neue Mainzer Straße 32 - 36
60311 Frankfurt am Main
Germany
Phone
+49 (0) 9450709–0
Fax
+49 (0) 69 9450709–9998