SFP: Special effects depress net profit
Swiss Finance & Property Investment AG (SFP) can look back on a successful 2017 financial year. The operating result increased once again, but declining special effects led to a lower profit than in the previous year, as the company announced.
SFP once again closed the 2017 financial year with a significant increase in operating earnings: The EBIT margin rose from 64.1 to 77.1 percent. However, operating income before revaluations slumped from CHF 44.0 to 27.6 million due to declining special effects. Accordingly, net profit excluding revaluation effects also declined from 14.5 to 11.9 million.
According to the figures, lower revaluation gains in the reporting period resulted in lower operating earnings before interest and taxes (EBIT) of 29.8 million (previous year: 37.4 million). Including revaluation effects, net income amounted to 19.3 million (previous year: 24.4 million). Earnings per share excluding revaluation effects amounted to CHF 3.97 (prev. yr. CHF 5.72), NAV/share CHF 95.10(12/31/17, prev. yr. CHF 91.93).
Portfolio value increases by more than 20 percent
The portfolio value rose by 106.5 million to 605.1 million (+21.4%) in 2017 as a result of eight acquisitions in the Basel and Zurich regions and revaluation effects. The vacancy rate was reduced again to a low 1.66 percent (previous year: 2.67%).
The company considers itself to be robustly financed with an equity ratio of 49.3 percent (previous year: 45.7%). The average interest rate including swaps for interest-bearing debt in the reporting year was 1.75 percent (previous year: 1.54%). The average fixed interest rate remained virtually unchanged at 8.11 years (previous year: 8.29 years).
The most important event last year was the successful capital increase of 62.7 million in July 2017. The Board of Directors proposes an unchanged cash distribution of CHF 3.60/share, bringing the distribution yield to 3.79 percent based on the share price on December 31, 2017.
Swiss Finance & Property Investment AG is well aware of the challenging environment. In view of the low interest rates, institutional demand for investment properties will remain high. SFP will respond to this by pursuing a strategy of consolidation while at the same time consistently expanding existing potential, the company says. Based on a careful assessment of risks and opportunities, the Board of Directors and the Executive Board expect a convincing company result in 2018 as well, which will secure the previous stable dividend policy.
