Adler Group’s rental business with strong performance in 9M 2024 – capital structure and equity position significantly improved following the successful recapitalization

Adler Group’s rental business with strong performance in 9M 2024 – capital structure and equity position significantly improved following the successful recapitalization
 

• Net rental income of €155m in the first half of 2024, 3% lower compared to the previous year due to portfolio disposals in 2023
• Like-for-like rental growth of 4.1%, vacancy rate at 1.7%, average residential rent at €7.71/sqm/month
• FY 2024 net rental income guidance confirmed
• Significantly improved capital structure following the completed comprehensive recapitalisation
• LTV reduced from 105.7% to 62.6%
• Disposal of BCP will further strengthen the liquidity position
• Stable yielding asset valuation expected for H2 2024

Luxembourg, 28 November 2024 – Adler Group S.A. ("Adler Group") announces its results for the nine-month period ending September 2024 with a solid operational performance. Net rental income decreased only slightly by 3% from €160m in the previous year to €155m due to portfolio sales in 2023 that no longer contributed to the 2024 income, e.g. the Wasserstadt transaction. The decrease in size was partly compensated by like-for-like rental growth of 4.1% resulting in an average residential rent of €7.71/sqm/month for the core portfolio as per September 2024. The operational vacancy rate stood at 1.7% as per end of Q3 2024. Adler Group confirms its guidance for the net rental income to range between €200m and €210m in the full year 2024.

As per 30 September 2024, Adler Group’s residential core portfolio includes 24,935 units, with the majority of 17,673 units located in Berlin. The gross asset value (GAV) of the yielding portfolio remained stable at €4.1bn as there was no external revaluation done at the end of the third quarter.

Subsequent to the end of the third quarter, Adler Group disposed its 62.8% stake in Brack Capital Properties N.V. (BCP) to LEG Immobilien SE. This transaction will generate 219 million euro of net cash proceeds and enable the company to execute its corporate strategy which foresees Adler Group to focus on yielding assets in the Berlin area.

“We are glad that we have succeeded to further stabilize Adler Group around the strong Berlin-focussed rental portfolio. We remain optimistic that a slowly improving transaction market provides us with chances to sell further assets in the coming months” comments Thorsten Arsan, CFO of Adler Group.

The income from operating activities amounted to minus €348m in the first nine months of the current financial year (previous-year period: minus €971m) and was largely affected by the negative portfolio revaluation result in the second quarter. As in prior periods, FFO I was negative at minus €88m (previous year: minus €8m) due to the increasing interest burden. However, net income was positive with €1,451m (previous-year period: net loss of €1,226m) as a result of the recapitalisation with the conversion of certain financial instruments into equity, resulting in a largely extraordinary net finance income of €1,809m.

Due to the recapitalisation, the group’s total equity increased significantly to €2,201m as per September 2024. The loan-to-value (LTV) reduced from 105.7% as per June 2024 to 62.6% as per September 2024. At the end of Q3 2024, Adler Group had cash and cash equivalents of €363m.

Stefan Brendgen, Chairman of the Board of Directors of Adler Group, comments as follows: “The third quarter 2024 was a milestone for Adler Group with the completion of the comprehensive recapitalisation, the publication of the audited annual reports and, most recently, the successful disposal of BCP. We have laid out the basis to pursue the next steps according to our corporate strategy, which foresees the Group to focus on yielding assets in the Berlin area.”

Furthermore, yesterday’s Ordinary General Meeting (OGM) of Adler Group passed all proposed resolutions including the approval of the appointment of Thorsten Arsan and Paul Copley as additional members of the Adler Group Board of Directors. Also, the OGM appointed AVEGA Révision to perform the audit of the 2024 standalone annual accounts and consolidated financial statements of Adler Group.

Webcast

A webcast for analysts and investors will be held today, Thursday, 28 November 2024, at 10:00am CEST / 09:00am GMT.

The webcast is available at the following link:
https://event.choruscall.com/mediaframe/webcast.html?webcastid=T2PxEUEZ

Contact

Investor Relations:
T +352 203 342 10
investorrelations@adler-group.com