UBM Development AG Q1 Results: Market Challenges and Strategic Asset Disposals

UBM Development AG announced its Q1 2024 results, showing a mixed performance amidst a continued standstill in the European real estate transaction market. The company managed to increase its Q1 sales by 14% year-over-year to €20.4 million. However, Q1 EBITDA decreased to €-2.2 million, primarily due to higher material expenses and unfavorable foreign exchange effects.

Despite these challenges, UBM made progress in disposing of non-strategic assets. Key sales included five slots of Arcus City, a building from Poleczki Business Park, and a 15% stake in the Andaz hotel in Prague. These transactions brought an estimated net cash inflow of €25 million. Management aims for a total net volume of €75 million in asset disposals for FY 2024.

The outlook for FY 2024 remains cautious, with an expected pre-tax loss of €-7.7 million, an improvement from FY 2023's €-39 million. However, UBM is well-positioned for market reopening, with 77% of its €1.9 billion pipeline focused on sustainable, timber-hybrid projects.

The stock continues to be rated a BUY, with a new price target of €27.00.