Allreal Holding to pay higher dividend

Allreal Holding AG, Baar, reports a net profit excluding revaluation effects of CHF 113.3 million for the 2017 financial year. Thanks to higher rental income, increased profitability of the general contracting business and lower financing costs, the operating result was above the previous year's figure despite significantly lower profits from the sale of development properties.  Net profit including revaluation effects amounted to CHF 129.2 million in the reporting period, 25.6 percent below the previous year's figure, which was characterized by exceptionally high revaluation gains and the sale of development properties.

Income from the rental and management of investment properties, together with the volume of projects handled, resulted in total revenues of CHF 603.4 million.

For the financial year 2018, the company expects an operating result slightly above that of the reporting period.

As a result of the expansion of the portfolio in the second half of 2017 and the reduction in vacancy-related loss of earnings, rental income was  rose by 3.4 percent to CHF 179.2 million in the reporting period, Allreal reports. The cumulative vacancy rate fell by 2.5 percentage points to a very low 2.6 percent in 2017. The company puts the net return generated by renting out residential and commercial properties at 4.3 percent. As of December 31, 2017, the investment property portfolio comprised a total of 63 units (20 residential, 43 commercial). The valuation of all investment properties carried out at the end of 2017 resulted in an overall positive change in value of CHF 21.8 million. As of December 31, 2017, the market value of the entire portfolio thus increased to CHF 3.96 billion.

Based on the good result in the reporting period and the stable business trend that is emerging in the coming years, the Board of Directors intends to propose to the Annual General Meeting to be held on April 20, 2018, the distribution of CHF 6.25 per share in the form of a par value reduction. Measured against the closing price as of December 31, 2017, this results in a cash yield of 3.8 percent.