Warteck Invest: Cautious optimism
Warteck Invest achieved an operating result (EBIT) of CHF 12.7 million in the first half of 2016, 5.4 percent more than in the previous year. Net profit increased by around ten percent to seven million. The company is "cautiously optimistic" for the rest of the financial year.
Warteck Invest cites income from rentals of CHF 12.3 million (previous year: 12.9 million) and, above all, a positive valuation result of 2.4 million (previous year: 0.9 million) as reasons for the increase in earnings. Excluding the result of valuations, consolidated net income fell by a good ten percent to five million, in particular due to higher expenses for the operation and maintenance of the properties.
Although vacancy rates in Warteck Invest's portfolio were not at the low level of the previous year (2.2%) with a rate of 3.5 percent, they were still low compared to the industry, the company said. As in the previous year, actual rental income was CHF 14.2 million.
Yield falls slightly
The gross return on the portfolio (target rental income in relation to market value) was 5.1 percent in the reporting period (previous year: 5.3%). The net yield (gross yield less vacancies, bad debt losses, operating costs and maintenance) decreased to 4.3 percent from 4.7 percent in the previous year. Performance (net return plus revaluation result) still reached 4.5 percent (previous year: 5.0%).
The market value of the portfolio reached CHF 608 million as of the reporting date, up from CHF 592.5 million at the end of 2015. The increase resulted on the one hand from acquisitions and investments in renovation and new construction projects and on the other hand from the positive result of revaluations, Warteck Invest reports.
Following the capital increase in the fall of 2015, the real estate company's equity ratio is currently around 46 percent.
The Board of Directors and Executive Board are "cautiously optimistic" about the second half of the year: The prospects for the development of the income side are intact, even if the current situation on the rental market will not leave Warteck Invest unscathed. However, the real estate portfolio is well diversified in terms of both geography and use and does not show any cluster risks in the tenant base. Acquisitions, completed projects and newly started construction projects will also generate new income for the company in the short and medium term. (ah)
