DIC Asset AG – the best FFO result in 25 years

Press release

DIC Asset AG – the best FFO result in 25 years

• Forecast for financial year 2022 achieved
• FFO of EUR 114.2 million increased by 7% year-on-year
• Assets under management at record level of EUR 14.7 billion
• Optimisation of steady earnings
• Dividend policy with continuity of distributions of at least 50% of FFO
• Proposed dividend of EUR 0.75 per share
• Positioned for the future in a sustainable, resilient and stable manner

Dear shareholders,

We are looking back at the financial year with the highest FFO result in the history of DIC Asset AG (“DIC”). It was a year that confronted us with major challenges due to the geopolitical situation and the changed parameters on the real estate investment market – especially with regards to the interest rate reversal. We successfully coped with these challenges. By the end of the financial year (based on provisional, unaudited figures), our funds from operations/FFO (before taxes, after non-controlling interests) stood at EUR 114.2 million, a result that is c. 7% above that of the previous year. This means we lived up to our forecast, which had projected FFO between EUR 114 and 117 million. So, we were not just very reliable during turbulent times, but also very successful.

Above all, we ensured that the FFO benefit to a significantly higher degree than before from sources that lend themselves to long-term planning. We thus took an active and far-sighted approach in responding to market shifts, and positioned the company in a sustainable, resilient and stable manner for the future.

At the beginning of the year, we grew significantly in our proprietary portfolio (Commercial Portfolio) with the acquisition of VIB Vermögen AG (“VIB”). Supplemented by strong like-for-like rental growth of 3.6%, we thus generated record gross rental income of EUR 176.0 million in 2022. This is an increase in growth of around 62% compared with the previous year.

Given the difficult parameters on the real estate investment market, and due to the delays and planning changes affecting transactions, we lowered our target for property management revenues in our third-party business (Institutional Business) later in the year, primarily because we anticipated lower earnings from transaction-based fees. With the 2022 financial year now concluded, we can say that we collected EUR 88.4 million in (both current and transaction-based) management fees.

The transaction targets for the concluded financial year, which we revised in November 2022 (aside from the acquisition of VIB in the amount of c. EUR 2.3 billion) were achieved with c. EUR 393 million euros in disposals from the proprietary portfolio and acquisitions in the amount of c. EUR 540 million in our third-party business.

Our proprietary portfolio grew to c. EUR 4.5 billion by year-end – which is more than twice as much as the year before. The valuation of the proprietary portfolio as of year-end was 1.5% above the previous year – which is explained by the changed portfolio mix with its higher logistics share, among other reasons, but which also points to the long-term viability of the entire real estate assets under our management.

With a total of c. EUR 14.7 billion in assets under management, our platform reached a new high-water mark by the end of 2022.

Based on the very positive results overall, we as Management Board resolved to propose the distribution of a dividend in the amount of EUR 0.75 per share, which would match the prior-year level, to the Supervisory Board for the 2022 financial year. This translates into an attractive dividend yield of 9.8% at the closing price of the DIC stock at the year-end 2022. The resolution on the appropriation of profits is subject to the Supervisory Board’s consent, which will decide in the matter during its balance sheet meeting on 14 February 2023.

Going forward, we intend to keep offering our shareholders an attractive dividend and to thereby ensure that they participate in the success of DIC. Our dividend policy aims for periodic distributions that, assuming a positive net income, equal at least 50% of the FFO generated during a given financial year.

In the 2023 financial year, our focus will be on the continued portfolio and cashflow optimisation, and we are now expecting a FFO total in a range of EUR 90 to 97 million. The main reason why we expect a year-on-year decline in FFO are the persistently challenging parameters on the real estate investment market. Considering that the interest environment has changed since 2022 and that the ramifications of a slowed business cycle on real estate demand in Germany remain unclear, we expect acquisitions and disposals to be subject to delays, especially during the first half of 2023, which will impact the total FFO expected for the 2023 financial year. In this context, we expect especially the transaction-related management fees in the Institutional Business to decline.

Dear shareholders, our company has delivered a very successful performance. At this point, DIC is looking back on a history of 25 years, in the course of which we have become a benchmark presence on the German real estate market. The things that have caused us to prosper so far will continue to give us the tailwind we need in 2023 and beyond. Our “dynamic performance” is the motivation and driving force of everything we do. Speed, creativity and reliability are our hallmarks. ESG acts as our DNA. You can rest assured that we will remain with our USP on the market, and that we will keep creating long-term values you will benefit from in the future as a result of our continuity of dividend payments!

Warmest regards,

Sonja Wärntges

Chief Executive Officer (CEO/CFO)

Note: The current dividend policy of DIC Asset AG matches the objectives and plans of the company’s Management Board and Supervisory Board. Annual dividend payments presuppose corresponding dividend proposals by the Management Board and the Supervisory Board. The dividend policy may be revised in future, with Management Board and Supervisory Board deviating from this dividend policy in response to changing circumstances. The dividend amount is approved by the general shareholders’ meeting at least once a year.

About DIC Asset AG:
 

DIC Asset AG is Germany’s leading listed specialist for office and logistics real estate with 25 years of experience on the real estate market and access to a broad-based network of investors. Our business is based on a regional and inter-regional real estate platform with nine offices on the ground in all major German markets (with VIB Vermögen AG included). We currently manage a total of 360 assets with a combined market value of EUR 14.7 billion on site, always close to our properties and their occupiers.

The Commercial Portfolio segment comprises real estate held for our own account. Here, we generate steady cash flows from stable rent revenues on long-term leases while also optimising the value of our portfolio assets through active management, and realising gains from sales.

In the Institutional Business segment, we earn recurrent fees from real estate services we provide to national and international institutional investors by structuring and managing investment products that return attractive dividend yields.

DIC Asset AG has been SDAX-listed since June 2006.

IR/PR Contact DIC Asset AG:
Peer Schlinkmann
Head of Investor Relations & Corporate Communications
Neue Mainzer Str. 20 • MainTor Primus

D-60311 Frankfurt am Main
T +49 69 9454858-1492
ir@dic-asset.de