COMPANY Blog

IMMOFINANZ Group’s stable results in the second quarter of financial year 2010/11, confirm the successful turnaround and the upward trend witnessed in the first quarter. Further optimisation of the portfolio, cost-cutting in operational areas and a greater focus on generating cash flow leads us to expect further improvement for the following quarters.

Income from asset management

In the first half of financial year 2010/11, rental income of EUR 277.1 million was generated. This represents to a rise of 4.9% compared to the same period in the previous year (EUR 264.0 million). Whilst revenues over the same period rose by 3.3% from EUR 352.5 million to EUR 364.3 million, income from asset management of EUR 224.2 million slightly decreased  (2009/10: EUR 229.3 million). Retail income – especially following the opening of the Golden Babylon Rostokino shopping centre in Moscow – was buoyant and rose year-on-year by more than EUR 18.9 million to EUR 87.9 million. Office rental income dropped as a result of real estate sales and the start of construction work in Cologne’s Gerling Quarter, which had previously been let.

Income from property sales

Income amounting to EUR 13.3 million was generated from property sales in the reporting period. Compared to income in the previous year of EUR 12.4 million, this represents a rise of 7.3%. The sold properties were mainly residential properties in Austria.

Income from development

Both the proceeds and the income arising from the sale of inventories in the portfolio rose significantly compared to the same period in the previous year. Whilst we generated proceeds of EUR 9.3 million and income of EUR 1.9 million in the first half of 2009/10, we achieved proceeds of EUR 36.3 million and income of EUR 6.2 million in the first six months of financial year 2010/11. EUR 27.5 million of the sales proceeds from these inventories relate to Austria, EUR 5.8 million to Poland and EUR 3.0 million to Serbia.

EBITDA, EBIT, EBT, net profit for the period and cash flow

Results of operations (EBITDA) fell compared to the same period in the previous year from EUR 216.9 million to EUR 181.4 million. This fall is mainly due to other operating income being EUR 34.5 million lower year-on-year. This reduction is in turn due to the lack of extraordinary income that was reported in the previous year.

Thanks to the positive revaluation results of EUR 86.3 million (2009/10: EUR 7.7 million), which were mainly due to foreign exchange effects, EBIT rose by 19.2% from EUR 224.6 million to EUR 267.7 million. 

Due to the lack of extraordinary items – significant income was generated in the same period of the previous year from the repurchase of convertible bonds – and expenses from foreign exchange fluctuations, the financial result decreased from EUR -17.2 million to EUR -149.3 million. This pushed earnings before tax (EBT) down from EUR 207.4 million to EUR 118.4 million. Taxes fell from EUR -43.9 million to EUR -10.1 million. All this led to a fall in net profit for the period from EUR 163.5 million to EUR 108.3 million.

Gross cash flow dropped from EUR 173.9 million to EUR 147.4 million. However, cash flow from operating activities rose from EUR 187.0 million to EUR 194.3 million, particularly due to the reduction in accounts receivable. Total operating cash flow, which includes both cash flow from operating activities and from investing activities, improved in the first half of financial year 2010/11 to EUR 222.0 million (2009/10: EUR 34.6 million), since the proceeds of sales were significantly higher than capital expenditures. 

NAV per share and earnings per share

The diluted net asset value (NAV) per share rose from EUR 4.82 as of 31 July 2010 to EUR 4.95. Based on the share price as of 31 October 2010 (EUR 2.83), IMMOFINANZ shares are therefore  trading at a discount of 42.87% to NAV. Earnings per share for the second quarter of 2010/11 came to EUR 0.11 (2009/10: EUR 0.18).

For further information read our report