Swiss Prime Site: Sale of Wincasa drives half-year profit
Profit excluding revaluations increased to almost CHF 300 million thanks to the sale of the real estate services provider. The Board of Directors confirms the targets for the year as a whole.
"Overall, we are satisfied with the first half of the year and confident about the rest of the year," said CEO René Zahnd when presenting the half-year results of Swiss Prime Site (SPS).
Profit excluding revaluations rose sharply to CHF 298.9 million (previous year: CHF 158.0 million). However, this includes the profit of CHF 145.9 million from the sale of Wincasa. Excluding this one-off effect and adjusted for the other gains from Wincasa, profit excluding revaluations amounted to CHF 149.2 million, a decrease of 2.2% compared to the previous year (CHF 152.6 million).
According to the half-year report, operating profit from continuing operations amounted to CHF 95.7 million (previous year: CHF 358.6 million) and profit amounted to CHF 65.9 million after CHF 262.1 million in the first half of 2022.
At CHF 2.01 per share, FFO I (operating cash flow before disposal effects) was slightly below the previous year's figure of CHF 2.09. The main reason for the reduction was the discontinuation of the contribution from Wincasa from the beginning of May, according to SPS. Compared to the first half of 2022, the leverage ratio (LTV) of the real estate portfolio fell by around 0.5 percentage points to 39.7% (previous year: 40.2%).
Vacancy rate falls to 4.1 percent
In the reporting period, SPS increased rental income by 1.9%, or by 3.4% on a comparable basis, to CHF 218.9 million. According to the company, the vacancy rate fell to a record low of 4.1%, down from 4.3% at the end of 2022. The fact that around 90% of rental space is index-linked also had a positive effect. The average lease term (WAULT) remains almost stable at 5.2 years.
Write-downs of almost CHF 100 million
The revaluation of the investment properties amounted to CHF -98.8 million, following a revaluation of CHF 166.6 million in the previous year. The devaluation corresponds to a relative reduction in fair value of -0.74% at the end of 2022, explains SPS. The total value of the real estate portfolio amounted to CHF 13.1 billion as at the reporting date and remains stable compared to the end of 2022.
Contrary to the lower estimated fair value in the existing portfolio, the sale of non-core properties generated profits of around CHF 101,000 thousand above the fair value at the end of 2022, SPS emphasizes. Ten properties with a total transaction volume of CHF 148 million have been sold since the start of the year, two of which were sold after the balance sheet date.
EBIT of Swiss Prime Site Solutions falls
Swiss Prime Site Solutions, the asset management division, experienced a "restrained investment appetite on the part of investors" in the first half of the year. Despite attractive acquisition opportunities, it was not possible to carry out all capital increases in the planned amount. Assets under management nevertheless increased by CHF 6.5% to CHF 8.2 billion (end of 2022: CHF 7.7 billion). Due to the lower issue volumes, income from asset management also fell from CHF 27.2 million to CHF 22.2 million. EBIT fell from CHF 17.1 million to CHF 11.3 million. The EBIT margin fell to kEUR 51.11 (previous year: kEUR 63.11), while the ratio of recurring income increased from kEUR 531 to kEUR 781.
Targets for the year as a whole confirmed
Given the current market conditions, SPS is positive about the second half of the year. The real estate company continues to anticipate higher rental income and, despite rising financing costs, stable FFO I. A "good result" is expected for asset management. (ah)
