Patrizia Immobilien : Increase in guidance 2018 – Operating income H1 2018 of EUR 72.5m –...

PATRIZIA Immobilien AG (ISIN DE000PAT1AG3) increases its guidance for operating income for the business year 2018 from a range of EUR 85-100m to a range of EUR 100-110m.

According to preliminary H1 2018 results, PATRIZIA generated an operating income of EUR 72.5m, equivalent to a growth of 106.6% compared to the same period last year.

In line with the company's strategy the further reduction of principal investments had a significant positive impact on net sales revenues and co-investment income in the first half of 2018. A similar impact is not expected during the second half of 2018, given the majority of scheduled disposals were realised during the first half of 2018.

At the same time, cost efficiency measures related to the acquisition of SPI, TRIUVA and Rockspring took effect faster than anticipated during the first half of 2018. Therefore net operating expenses (Operating costs) of EUR 90.4m in the first half of 2018 came in better than internally expected. PATRIZIA hence adjusts its guidance for net operating expenses for the 2018 business year from a range of EUR 210-230m to a range of EUR 200-210m.

Compared to its original cost guidance 2018, PATRIZIA expects annual cost synergies from the integration of SPI, TRIUVA and Rockspring in the region of EUR 22m which, all else being equal, should show full effect from the 2019 business year onwards.

To realise the above cost synergies, the company expects restructuring costs in the region of EUR 30m likely to be booked during the second half of 2018 with no effect on operating income.

The full Interim Report for the first half of 2018 will be published on 7 August 2018.