Ad-hoc: PATRIZIA generates EUR 9.2 million in adjusted earnings before tax in Q3 2008
- Market valuation of interest rate hedges negatively impacts profit to the amount of EUR -10.0 million
- Net profit before tax, calculated in accordance with IFRSs, thus amounts to EUR 1.8 million for the first nine months of the year
- Block sales develop to become a highly profitable sales channel
In the first nine months of 2008, PATRIZIA Immobilien AG (ISIN: DE000PAT1AG3) generated net profit after taxes of EUR 1.3 million, in accordance with IFRSs – however, the Company recorded a loss of EUR 0.6 million for Q3. However this figure was negatively impacted to the amount of EUR -10.0 million due to the updated market valuation of interest rate hedges. The pre-tax profit (EBT) for the first nine months of 2008 adjusted for all items not impacting liquidity, amounted to EUR 7.2 million.
This enabled the Company to once again gradually increase its operating performance over the first three quarters of 2008 and increasingly generate positive liquid returns from operations. Although EBT in Q1 was still slightly negative at EUR -2.3 million after adjustment for all one-time items not impacting liquidity, the Company generated slightly positive EBT (adjusted) in Q2 of EUR 0.2 million. Despite the continuing difficult market environment, EBT (adjusted) was already at EUR 9.2 million in Q3.
Despite the block sale of Dresden Altmarktkarree 1, a comparison of the quarters shows that revenues fell by EUR 41.4 million. Due to the fact that this project was reported under the Investment property item, the purchase price of EUR 70.0 million was not posted as revenues but rather as profit from the disposal of assets under the item Income from the sale of investment property. Revenues for the first three quarters of 2008 amounted to EUR 139.7 million, significantly higher than same period of the previous year (EUR 99.8 million). Rental income of EUR 18.5 million continues to cover interest expenses for bank loans of EUR -17.7 million.
In terms of demand, we are sensing increased reservation on the part of private apartment purchasers. The number of privatized units dropped to 83 in the period from July to September (Q2: 103 units). A total of 330 units were privatized over the first three quarters of the year. The average price per square meter in individual sales of EUR 2,230 remained at the same high rate compared with the prices per square meter generated in the previous quarter. In contrast, block sales are developing to become a highly profitable sales channel: in the first nine months of 2008, we notarized four block sales with a total of 518 residential and commercial units.
Due to the cash inflows from real estate sales, we managed to drive forward the repayment of loans. The equity ratio in the Group increased slightly to 21.7%. As of September 30, 2008 total bank loans amounted to EUR 1,189.1 million – a reduction of EUR 72.9 million in comparison with December 31, 2007. At the end of Q3 2008, bank loans due in less than 12 months amounted to EUR 598 million. Despite the financial market crisis, these were extended by around EUR 530 million to March 31, 2009 – a second tranche was then extended by about EUR 50 million to June 30, 2009.
However in light of the developments of the financial market crisis in recent weeks and the existing uncertainty of investors, we do not expect transaction business to pick up in Q4 2008, despite the normal seasonality of the business. It is difficult to say at present whether and when the block sales already being negotiated will be executed. At present, we believe that our forecast for 2008 of EUR 25 million to EUR 30 million in earnings before tax will not be achieved. For now, we are unable to say to what extent our forecast of a positive liquid profit will need to be adjusted. If the general uncertainty among investors diminishes again, we expect the transaction market for small high-quality residential real estate portfolios to recover quickly.
The complete interim report for the third quarter of 2008 can be found here.
Key figures 3rd quarter 2008:
(in EUR thou.) 3rd quarter 2008 3rd quarter 2007
Revenues 41,410 41,387
EBITDA 26,556 77,651
EBIT 26,416 77,458
EBIT (adjusted) 26,416 10,433
EBT -811 53,998
EBT (adjusted) 9,229 -6,557
Augsburg (Germany) – November 11, 2008
PATRIZIA Immobilien AG
Listing: Frankfurt Official Market (Prime Standard)
|Phone:||+49 (0) 821 5 09 10-360|
|Fax:||+49 (0) 821 5 09 10-399|
|Phone:||+49 (0) 821 5 09 10-655|
|Fax:||+49 (0) 821 5 09 10-695|
|Issuer:||PATRIZIA Immobilien AG|
|Phone:||+49 (0)821 - 509 10-000|
|Fax:||+49 (0)821 - 509 10-999|
|Listed:||Regulierter Markt in Frankfurt (Prime Standard); Freiverkehr in Berlin, München, Hamburg, Düsseldorf, Stuttgart|
End of News