PSP confirms operating forecast
PSP Swiss Property's net profit for the first nine months fell by 45.3% due to devaluations. However, profit excluding gains/losses on real estate investments rose by 16.3%.
The balance sheet value of PSP's portfolio increased from CHF 9.4 billion to CHF 9.7 billion over the course of the three quarters. The vacancy rate increased from 3.0% to 3.2% and is expected to be below 4% at the end of 2023. The reason for the slight increase is the "B2Binz" project, which is not due to be completed until Q4 2023.
Lower profits from sales
Property income increased by CHF 10.7 million or 4.5% to CHF 236.8 million compared to the previous year. Profit excluding gains/losses on real estate investments increased by CHF 16.3% to CHF 29.5 million. A positive contribution to earnings of CHF 30.6 million came from the reversal of deferred taxes. By contrast, lower profits from the sale of development projects and condominiums had a negative impact - this figure was CHF 9.8 million lower than in Q1-Q3 2022. Operating expenses fell by CHF 1.3 million or 3.1% to CHF 41.7 million, while financing costs rose by CHF 6.9 million or 79.8% to CHF 15.5 million.
Net profit fell by 45.3% to CHF 155.3 million. The reason for this is that following the revaluation of CHF 131.9 million in the same period of the previous year, a valuation result of CHF -67.2 million was now reported. This sum resulted from a devaluation of CHF 90.7 million as at June 30 and a revaluation of CHF 23.5 million in total as part of a revaluation of the two properties Bahnhofplatz 1, 2/Bahnhofquai 9, 11, 15 in Zurich, where the project development was completed, and Binzring 15/17 (also in Zurich), where a rental agreement was extended.
Real estate income to increase for the year as a whole
For the current year, PSP expects property income to be higher overall than in 2022, mainly due to the indexation of rental agreements at the beginning of 2023, the completion of several projects and the acquisition in Zurich West. Income from the sale of development projects and condominiums is expected to fall, while operating costs should remain stable. The reversal of deferred taxes will have a positive impact on profit excluding gains/losses on real estate investments, as a further reversal of deferred taxes in the amount of around CHF 60 million will take place at the end of 2023. Overall, EBITDA excluding gains/losses on real estate investments is expected to reach CHF 295 million (2022: CHF 293.8 million). The company is thus confirming its last forecast, which was raised slightly by CHF 5 million (IB reported). (aw)
