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31.03.2011 – 08:01

Fair Value REIT-AG

EANS-News: Fair Value REIT-AG records strong sales and earnings growth in 2010

- IFRS consolidated net profit of EUR 2.2 million (previous year: net loss of EUR 2.9 million) - German GAAP (HGB) retained earnings of EUR 1.0 million (previous year: net loss of EUR 2.8 million) - Proposed dividend of 93.5% of HGB retained earnings (EUR 0.10 per share)

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Financial Figures/Balance Sheet

Subtitle: - IFRS consolidated net profit of EUR 2.2 million (previous year: net loss of EUR 2.9 million) - German GAAP (HGB) retained earnings of EUR 1.0 million (previous year: net loss of EUR 2.8 million) - Proposed dividend of 93.5% of HGB retained earnings (EUR 0.10 per share)

München (euro adhoc) - Munich, 31 March 2011 - The final figures for the financial year 2010 show a marked improvement in both revenues and earnings of Fair Value REIT-AG. Revenues increased to EUR 14.4 million from EUR 12.2 million in the previous year. Consolidated net profit amounted to EUR 2.2 million, which improved by EUR 5.1 million compared to a net loss of EUR 2.9 million recorded in the previous year. The 2010 annual report, which includes the complete consolidated financial statements of Fair Value REIT-AG is available on the Internet at from today.

The Group's net rental result increased from EUR 8.5 million to EUR 9.5 million, representing a year-on-year growth of 12%. This positive development is the result of the first-time consolidation of earnings of the IC 13 subsidiary, which was previously included in income from participations. At EUR 2.9 million, the operating result increased by EUR 3.6 million over the EUR -0.7 million reported in the previous year. In addition, earnings from associated companies increased substantially to EUR 3.9 million thus contributing to the success of Fair Value REIT-AG in 2010 (previous year: EUR 1.4 million).

The main reason for the increase in earnings was the significantly improved valuation result of the real estate portfolio, as well as cost savings. On balance, there was a valuation loss of around 2%, which was mainly due to temporary vacancies in individual properties. Compared with the previous year (-4%), the valuation result improved by 50%.

The consolidated net income of EUR 2.2 million, translates into earnings of EUR 0.24 per share for the reporting period. This represents an improvement by EUR 0.55 compared to EUR -0.31 per share recorded in the previous year.

The operating cash flow (so-called "Funds from Operations", FFO) of the Fair Value Group amounted to EUR 4.8 million or EUR 0.51 per share in the year under review. This increase of EUR 1.9 million over the previous year (EUR 2.9 million) is largely due to higher inflows from the associated companies. As of the balance sheet date, the Group's cash and cash equivalents amounted to EUR 12.0 million (previous year: EUR 8.2 million).

The consolidated net income (EPRA result) adjusted for changes in market value and other one-off effects, increased to EUR 5.8 million compared to the full-year forecast raised in November 2010 to EUR 5.1 million. This was mainly due to savings in maintenance and rental costs. The slight decrease in adjusted consolidated net income in comparison to the EUR 6.0 million recorded last year was due to the disposal of properties sold in the previous year.

As of the balance sheet date, consolidated equity amounted to EUR 74.6 million (31 December 2009: EUR 72.7 million). As a result, net asset value (NAV) per shares in circulation increased by around 3% to EUR 8.00 per share (previous year: EUR 7.78). Equity pursuant to § 15 of the REIT Act, including minority interests in subsidiaries, rose to 49.6% of immovable assets (31 December 2009: 45.5%).

With respect to the 2010 German GAAP single-entity financial statements, the target for retained earnings of around EUR 1.0 million has been achieved. The Management Board and Supervisory Board will, therefore, submit a proposal to the Annual General Meeting on 31 May 2011 for a dividend payment of EUR 0.10 for 2010. This represents a payout ratio of 93.5% (the requirement under § 13 of the REIT Act is at least 90%).

Frank Schaich, CEO of Fair Value REIT-AG, believes that the stable earnings base is the main reason for the positive performance of the Group. "In 2010 we were able to maintain a high occupancy rate of around 94%, which remained close to previous year's level. At the same time, we managed to realize about 75% of the expiring lease volume in 2010 through re-letting and new leases. This led to savings in rental costs, which contributed to the significant increase in our adjusted consolidated net income compared to forecasts."

Adjusted consolidated net income of EUR 4.3 million or EUR 0.46 per share is forecasted for 2011. The forecast includes re-letting and new lease expenses relating to lease agreements expiring during the year and in addition to that expenses for letting the entire current vacancy in the portfolio. If such expenes turn out to be lower than expected, the final result may be higher than forecasted, as was the case in previous years. For 2012, Fair Value is predicting adjusted consolidated net income of EUR 5.1 million or EUR 0.55 per share

With respect to the non-consolidated financial statements of Fair Value REIT-AG under the German Commercial Code, we seek to achieve retained earnings, which will support a dividend payment of at least EUR 0.10 per share in 2011 and 2012. In order to reach this target, income from portfolio adjustments will be required, which has not been secured yet. However, on the back of the improved investment climate for real estate we believe this to be achievable.

Selected financial indicators of Fair Value REIT-AG:

2010             2009
FFO                                      EUR 4.8 million  EUR 2.9 million
FFO per share in circulation             EUR 0.51         EUR 0.32
Adjusted Group earnings after taxes      EUR 5.8 million  EUR 6.0 million
EPRA EPS                                 EUR 0.62         EUR 0.65
IFRS consolidated net income             EUR 2.2 million  EUR -2.9 million
IFRS EPS                                 EUR 0.24         EUR -0.31

                                         31/12/2010       31/12/2009
Balance sheet NAV per share              EUR 8.00         EUR 7.78
Equity ratio under § 15 of the REIT Act  49.6%            45.5% 
end of announcement                               euro adhoc

Further inquiry note:


Fair Value REIT-AG
Frank Schaich
Tel.: 089-9292815-10
Fax: 089-9292815-15

Branche: Real Estate
ISIN: DE000A0MW975
Index: CDAX, Classic All Share, Prime All Share, RX REIT All Share
Index, RX REIT Index
Börsen: Frankfurt / regulated dealing/prime standard
Berlin / free trade
Stuttgart / free trade
Düsseldorf / free trade
München / free trade

Original content of: Fair Value REIT-AG, transmitted by news aktuell

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