Swiss Prime Site: Revenue and profit increase
Swiss Prime Site increased its operating income by more than five percent in the 2018 financial year. Profit increased by around two percent to CHF 310.9 million.
Operating income increased by 59.3 million orTP2T 5.11 year-on-year to CHF 1.21 billion. The core real estate business contributed 509.2 million to this - 6.4% or 30.8 million more than in the previous year. The increase was mainly based on higher income from the rental and development of real estate and projects, Swiss Prime Site said. At 11.2 billion, the market value of the 190 properties increased by 5.4% or 571.3 million. The net yield amounts to 3.6%. The vacancy rate in the portfolio was 4.8% after 5.2% in the previous year.
Income from the Services segment increased by 4.8% and reached 790.7 million (previous year: 754.6 million). Wincasa increased income from real estate services from 142.2 to 144.4 million. The market value of the managed portfolio is around 68 billion. Tertianum now has 77 locations throughout Switzerland. Income from Living in Old Age increased byTP2T 10.21 to 396.9 million.
Jelmoli reported a decline in income: income from own-managed areas fell from 136.2 to 131.3 million. Swiss Prime Site Solutions also generated less in 2018 than in the previous year: income was 8.5 million compared with 9.9 million in 2017. The real estate assets of the Swiss Prime Investment Foundation, which is managed by Swiss Prime Site Solutions, amount to around 1.6 billion.
Operating result increases mainly thanks to the real estate business
Swiss Prime Site's operating result (EBIT) increased from 470.6 to 478.6 million in the period under review. This figure includes revaluations of 67.6 million (previous year: 65.9 million). EBIT excluding revaluations reached 411.1 million (previous year: 404.8 million). The core real estate business (+2.1%) continued to contribute the lion's share to the result, Swiss Prime Site said.
Rental income increased and projects were successfully sold, the statement continues. Overall, the sales resulted in pre-tax income of 33.9 million. Operating expenses in the Real Estate segment, however, rose by 40.5 million to 165.1 million - mainly due to expenses for the sold real estate developments, according to the company.
The Services segment recorded a slight decrease in EBIT from 48.6 to 47.6 million. Operating expenses in the segment reportedly rose from 705.7 to 742.6 million. This was mainly due to higher personnel expenses and depreciation and amortization, according to Swiss Prime Site.
Profit increases
On balance, Swiss Prime Site made a profit of 310.9 million in 2018, compared with 305.5 million in the previous year, or 287.8 million excluding revaluations and deferred taxes (previous year: 307.4 million). Operational improvements of the group companies and recurring gains from the sale of real estate developments and properties compensated for the growth-related higher costs, the company says.
Earnings per share (EPS) amounted to CHF 4.27 in fiscal 2018, as in the previous year. Excluding revaluations and deferred taxes, EPS reached CHF 3.95, compared to CHF 4.30 in fiscal 2017. The dividend is expected to be CHF 3.80 per share.
For 2019, Swiss Prime Site expects stable results in terms of both revenue and profit. Asset, portfolio and vacancy management as well as the implementation of development projects are expected to contribute to this. The company is convinced that the resulting properties will provide significant growth impetus in future rental income from the fourth quarter of 2019. (ah)
