Zug Estates significantly increases net profit
The Zug Estates Group increased its net income by almost 50 percent to CHF 67.1 million in the 2015 financial year. Income from real estate rose by 4.4% to CHF 39.1 million and operating income before depreciation and revaluation by 4% to CHF 39.2 million.
Operating income amounted to CHF 63 million, 1.6% more than in the previous year. At CHF 19.8 million, the Hotel & Catering division was just able to maintain its income in a difficult market environment.
Last year, Zug Estates invested CHF 47.5 million in the further development and consolidation of its sites. In addition, the balance sheet value of the investment properties increased by CHF 50.5 million net as a result of the revaluation. Net income from the revaluation of investment properties thus more than doubled compared to the previous year's figure of CHF 21.3 million. According to the company, the location and property qualities of the portfolio with a high proportion of residential properties, the ongoing development and positioning of the Suurstoffi site, success in letting and market-related factors all contributed to this. Consolidated net income excluding revaluation rose by 0.3 percent to CHF 24.1 million (previous year: CHF 24 million).
The balance sheet value of the entire portfolio amounted to around CHF 1.1 billion at the end of 2015, 6.7% more than in the previous year. The market value of the entire portfolio was just under CHF 1.2 billion (previous year: CHF 1.1 billion). As at December 31, 2015 (reporting date), the vacancy rate was 5.4%, a decrease of one percentage point compared to the middle of the year. Adjusted for vacancies from first-time lettings (primarily parking spaces) and the space let to HSLU and other tenants over the course of 2016, the vacancy rate at the end of the year was 2.3%.
Zug Estates is "cautiously optimistic" for 2016, as the company writes in a press release. Overall, it expects operating income before depreciation and revaluation to be on a par with the previous year. In the real estate segment, the Group anticipates higher rental income thanks to the apartments completed in 2015 and the newly concluded rental agreements as well as declining vacancy rates. In the Hotel & Catering segment, catering income is expected to be around CHF 2 million below the previous year due to the loss of revenue from catering at the Theater Casino Zug. However, by focusing on its core business, Zug Estates will be able to maintain its position. (ah)
