from Swiss Prime Site AG (isin : CH0008038389)
Swiss Prime Site: strategic and operational progress with increased earnings in first half of 2024
Swiss Prime Site AG / Key word(s): Half Year Results/Real Estate Ad Hoc announcement pursuant to article 53 LR PRESS RELEASE Zug, 22 August 2024
Swiss Prime Site confirmed its strategic focus in the first half of 2024, making good progress both strategically and operationally. René Zahnd, CEO of Swiss Prime Site: «Operationally, we improved again in the first half of the year and can see how our focus on the real estate business has positively impacted our financial results. Strategically, we expanded our platform and increased our real estate assets under management to almost CHF 26 billion with the acquisition of Fundamenta, becoming one of the strongest players in the Swiss real estate market in both the commercial and residential segments. We are now ideally positioned to take advantage of the positive momentum in the market.» Rental growth and efficiency gains in the Real Estate business area Attractive portfolio with further potential Swiss Prime Site continued to push ahead with its capital recycling in the first half-year, financing the Company’s development investments with sales and continuously optimising and modernising the portfolio. Six properties with a total value of around CHF 50 million were sold on the market – at prices around 5% higher than the most recent appraisal values at the end of 2023. The Company therefore anticipates sales in the order of CHF 250–300 million for this year again. Swiss Prime Site is sharpening its focus on new, centrally located properties, which are efficiently managed for the tenants at a high standard and with sustainability in mind. Asset Management: acquisition of Fundamenta and several new issues The turnaround in the interest rate environment and the continued positive economic data in Switzerland have also increased the attractiveness of real estate investments once again. This is exemplified by the capital increases carried out in the first half-year. In total, Swiss Prime Site raised around CHF 270 million in new money and contributions in kind for its products, specifically the Akara Swiss Diversity Property Fund PK, the Swiss Prime Investment Foundation and the Fundamenta Group Investment Foundation. Revenue from Asset Management grew by 22% to CHF 27.0 million [22.2 in the prior-year period]. The expanded asset base allowed Swiss Prime Site to earn significantly higher management fees, which further raised the proportion of recurring income to 80% [78%] and underlines the stability and consistency of this business segment. EBITDA grew by 22% to CHF 14.6 million [11.9], in line with revenue growth. Fundamenta’s contribution was only included on a pro-rata basis for the period following the completion of the acquisition in April; synergy effects are expected to start taking hold in the second half of the year. Swiss Prime Site is on course with its plans and continues to expect an FFO I contribution of CHF 0.20 per share from the acquisition on a run rate basis. Higher operating profit and FFO I Total net financial expenses increased to CHF 29.5 million [28.1] due to higher refinancing costs compared to expiring financing. This included non-cash fair value adjustments of convertible bonds of CHF 7.2 million, which reduced expenses in the reporting period; actual interest expenses were correspondingly higher. The cash-effective funds from operations per share (FFO I) rose by 4.6% to CHF 2.03 [1.94]. The purchase price for Fundamenta, partially paid in shares, slightly increased the number of average outstanding shares. The fact that Swiss Prime Site was still able to increase the result per share from the outset underscores the attractiveness of the transaction. Sustainable refinancing In the first half-year, Swiss Prime Site profited from a highly receptive capital market and successfully placed a total of CHF 435 million in bonds with a sustainability focus on the Swiss capital market as part of the Green Finance Framework. The loan-to-value ratio (LTV) of the property portfolio increased temporarily as at the end of June to 40.9% [39.8% as at December], exceeding the target figure of 40%. The increase can be ascribed – all other things being equal – to the dividend payment in particular, which is routinely paid in the first half-year. Swiss Prime Site intentionally scheduled the majority of its property sales for the second half of 2024, with a view on the expected and now materialized interest rate cuts. The Company therefore remains confident of completing the sales that are planned for the whole of 2024, which will bring the LTV ratio back below 40% by year-end. Outlook remains optimistic In conclusion, Swiss Prime Site expects a vacancy rate of around 3.8% for the full financial year and an LTV for the property portfolio that will return to below 40% in the second half of the year. The assets under management of Swiss Prime Site Solutions are expected to amount to approximately CHF 13 billion at the end of 2024. Swiss Prime Site also anticipates an increase in the FFO I to between CHF 4.15 and 4.20 per share. If you have any questions, please contact: End of Inside Information |
Language: | English |
Company: | Swiss Prime Site AG |
Poststrasse 4a | |
6300 Zug | |
Switzerland | |
Phone: | +41 (0)58 317 17 17 |
E-mail: | mladen.tomic@sps.swiss |
Internet: | www.sps.swiss |
ISIN: | CH0008038389 |
Listed: | SIX Swiss Exchange |
EQS News ID: | 1972731 |
End of Announcement | EQS News Service |
1972731 22-Aug-2024 CET/CEST