Swiss Estates publishes half-year report
Swiss Estates AG increased its property income and operating result in the first half of 2018. Nevertheless, profit declined significantly compared to the same period of the previous year.
Net property income amounted to approximately CHF 3.15 million in the reporting period from January 1 to June 30, 2018, compared to approximately CHF 3.03 million in the prior-year period. The operating result increased from 871,000 to around 1.08 million. Swiss Estates put its half-year pre-tax profit at CHF 497,000, up from CHF 1.02 million a year earlier. The bottom line is a profit of 207,000 (previous year: 671,000).
Significant refinancing of mortgages had an impact on the half-year result, says Swiss Estates. Existing short- and medium-term mortgage financing was converted into long-term, fixed-interest financing. In some cases, this resulted in release costs as a one-off effect, which had a negative impact on the half-year result.
In addition, costs were incurred in connection with the extensive repurchase of the bond with a volume of 10 million in the second half of the year. The convertible bond is due for repayment on June 30, 2029 and pays an annual interest rate of 1.5 percent. Swiss Estates repurchased shares in the amount of 7.2 million and put them on its own books; of the total volume, 2.8 million thus remain with an institutional investor.
Swiss Estates further announces that it is in concrete negotiations for the acquisition of further real estate portfolios. These are to be implemented before the end of the current financial year. The company invests on an opportunistic basis in residential properties with 20 or more rental units in Switzerland's urban areas and in the agglomerations of major cities. The shares of Swiss Estates have been listed on the BX Swiss since 2006.
At the end of September, exchange operator BX Swiss AG imposed a fine of CHF 10,000 on Swiss Estates for violating regulations in connection with ad hoc publicity obligations. The real estate company had failed to inform the market by means of a public announcement about a legally binding conviction of the chairman of the board of directors, BX Swiss announced. The related criminal proceedings had already been initiated in 2009. The first-instance conviction took place on January 27, 2016, but only became final on January 18, 2018, after the Federal Supreme Court dismissed the appeal of the Chairman of the Board of Directors. The Sanction Commission of BX Swiss qualified the violation as "moderately serious and at least possibly committed with intent," the statement continued. (ah)
