Allreal increases profit
Allreal posted a net profit excluding revaluation effects of CHF 59.1 million in the first half of 2015, up 6.7 percent year-on-year. According to the real estate company, this was mainly due to one-off gains from the sale of investment properties and the constant increase in rental income.
Including revaluation effects, net profit for the reporting period amounted to CHF 67.2 million, an increase of 3.1 percent over the comparable figure for the previous year.
According to the company, the expansion of the investment property portfolio in previous years led to a significant increase in rental income of 18.6 percent to CHF 88.5 million in the first half of 2015.
The cumulative vacancy rate decreased by 0.3 percentage points to 7.6 percent of target rental income in the reporting period. Based on ongoing negotiations with various prospective tenants, Allreal expects a further reduction in the vacancy rate in the second half of 2015.
The net yield is now 4.2 percent, slightly lower than in the previous year due to the increase in real estate expenses and the vacancy-related loss of income.
On the reporting date, the investment property portfolio comprised 19 residential and 43 commercial properties with an average market value of CHF 55.5 million. The portfolio of investment properties under construction included two projects with a total investment volume of CHF 96 million; the value amounted to CHF 33.8 million. The value of the total investment property portfolio on the reporting date was CHF 3.47 billion, of which investment properties accounted for CHF 3.44 billion.
The project volume handled in general contracting declined (-37.9% to CHF 303.8 million). Income from this business unit fell by 43 percent to CHF 36.1 million. The operating margin was only 16.6 percent - after 50.2 percent in the same period of the previous year.
The measures introduced in the Realization division to increase profitability would have resulted in income from general contracting (third-party projects) of CHF 26 million, 13 percent above the previous year's figure. However, income from the sale of development properties amounted to only CHF 3.6 million, compared with almost CHF 30 million in the same period of the previous year.
Despite lower operating expenses compared with the first half of 2014, the business segment's EBIT of CHF six million is significantly below the previous year's figure of CHF 32 million. However, the gains from the sale of condominiums in the Guggach project in the second half of 2015 will have a compensating effect on both EBIT and general contracting income, Allreal wrote in a statement.
In the first half of 2015, the General Contracting business segment accounted for 5.8 percent of the Allreal Group's operating result. The share of the Real Estate business segment was 94.2 percent.
