PATRIZIA: Solid financial performance and strong AUM growth in 3M 2022 – Management responds to increasingly challenging market conditions and adjusts guidance for FY 2022

PATRIZIA reports strong growth in Assets under Management to EUR 55.3bn (+13.8% y-t-d) driven by the consolidation of Whitehelm Capital. Management fees of EUR 54.7m grew 7.4% y-o-y due to continued growth in AUM. EBITDA of EUR 26.4m (-16.8% y-o-y) came in below last year’s levels due to ongoing strategic investments.

Following publication of PATRIZIA’s Group Annual report 2021 in March 2022, both geopolitical and macroeconomic risks have increased further. While PATRIZIA continues to have a well filled transaction pipeline for its global clients, increased market uncertainties may demand more time to sign and close transactions and thus indirectly cause delays in transforming pipeline potential into transaction fees. As a precautionary measure, management has decided to lower the FY 2022 expectation for transaction fees from EUR 50.0 – 55.0m to EUR 30.0 – 38.0m.

On the other hand, management sees upside potential for performance fee realisation throughout FY 2022 following a strong start into the year and increases the guidance from EUR 50.0 – 60.0m to EUR 55.0 – 65.0m.

Management expects management fees to remain unchanged at EUR 245.0 - 260.0m.

Subsequently the guidance range for total service fee income is lowered from EUR 345.0 – 375.0m to EUR 330.0 – 363.0m.

In addition, the guidance for net sales revenues & co-investment income is lifted from EUR 2.0 – 5.0m to EUR 5.0 – 7.0m due to the revenue contribution already achieved during 3M 2022.

Against the backdrop of the above, management has started to look into opportunities to further improve the Group‘s cost base in the medium term. Among other things management has recently initiated a strategic review of technology investments to identify projects with the target to focus on those with a reasonable mid-term payback profile. PATRIZIA may terminate selected projects short-term while taking a conservative stance on the valuation of projects that will be continued.

As a result of project terminations, management adjusts the guidance for net operating expenses from EUR 227.0 – 235.0m to EUR 235.0 – 250.0m

The FY 2022 guidance for EBITDA will hence be adjusted from EUR 120.0 – 145.0m to EUR 100.0 – 120.0m.

In addition, management expects an extraordinary depreciation on selected technology investments over the course of the year 2022 with the final amount yet to be determined.

As a precautionary measure management has decided to consider an extraordinary depreciation of EUR 12.0m and to lower its expectations for FY 2022 EBIT and EBT, bringing the FY 2022 EBIT guidance range to EUR 49.5 – 69.5m (from EUR 81.5 – 106.5m) and the EBT guidance range to EUR 46.2 – 66.2m (from EUR 78.2 – 103.2m). The depreciation however does not impact the key financial indicators AUM, EBITDA and EBITDA margin.

PATRIZIA will publish the full set of 3M 2022 financial results – as planned – in the evening of 11 May 2022.