HAMBORNER REIT AG: Figures for 2020 confirm revenue and earnings growth and underline high business model stability - dividend proposal of ?0.47 per share
- Growth in rental income (+3.6%) and FFO (+2.4%)
- Successful progress in portfolio expansion and optimisation
- Strong letting performance and sustained extremely low vacancy rate
- Dividend proposal on previous year's level at ?0.47
- Choice of cash or scrip dividend once again
SUCCESSFUL 2020 FINANCIAL YEAR
Duisburg, 22 March 2021 - HAMBORNER REIT AG today publishes its annual report for 2020 following another successful financial year with further growth in revenue and earnings. The business figures reported in conjunction with the publication of the preliminary results for the year on 4 February 2021 have been confirmed in full.
Income from rents and leases and funds from operations (FFO) saw year-on-year growth to ?88.2 million (+3.6 %) and EUR 55.6 million (+2.4 %) respectively, thereby also exceeding the revenue and earnings forecast for the past financial year that was published in July 2020.
The company added three high-quality, newly built office properties and a small retail centre to its portfolio in 2020. The total investment volume was ?101.4 million. The properties will contribute around ?5.0 million to income from rents and leases in future.
As part of its ongoing portfolio optimisation with a current focus on successively selling off retail properties in city centre locations, the company signed contracts in the second half of 2020 to sell a total of eleven mostly smaller high street retail assets that are no longer consistent with its strategy. The sale prices totalled around ?59.1 million.
The external valuation of the property portfolio at the end of 2020 resulted in the fair value of the properties already in the portfolio as at 31 December 2019 being reduced by 3.5%. This related essentially to retail properties in city centre locations that were hit particularly hard by the coronavirus pandemic. Taking into account the revaluation and the property additions and disposals during the year, the fair value of the portfolio as a whole was ?1.625 billion as at 31 December 2020. Net asset value (NAV) per share declined by 4.7% as against the end of 2019 to ?11.05.
OPERATING PERFORMANCE IN 2020
The letting market saw negative development in the past year due to the COVID-19 pandemic and the resulting impact on the macroeconomic environment. Although space turnover declined significantly in some cases, the company succeeded in concluding leases for around 102,000 m² during the course of 2020. This primarily related to lease renewals with existing tenants. In terms of total leased space, the retention rate in 2020 was around 84%. Thanks to successful letting activity, the average remaining term of the leases (6.3 years) and the occupancy rate (98.1% according to the EPRA definition) remained at a high level at the end of 2020. The extremely positive operating performance given the economic conditions serves to underline the company's internal asset management expertise and the sustained high quality of its property portfolio.
DIVIDEND & ANNUAL GENERAL MEETING
In line with the positive business performance in 2020, the Management Board and the Supervisory Board will propose a dividend of ?0.47 per share to this year's Annual General Meeting, the same as in the previous year. Based on the current share price, this would correspond to a dividend yield of around 5.3%.
In light of the high level of shareholder acceptance last year, the company intends to offer a scrip dividend once again. This means that shareholders interested in a straightforward reinvestment of their dividend entitlement can again receive stock in HAMBORNER REIT AG instead of a conventional cash dividend. Further information on the scrip dividend and a dividend calculator that can be used to calculate shareholders' individual entitlement to new shares can be found on the company's website at https://www.hamborner.de/en/investor-relations/scrip-dividend.html.
The Annual General Meeting of the company will be held on 29 April 2021 as a virtual Annual General Meeting without shareholders or their authorised representatives attending in person. The agenda and the proposals for resolution will be published today in the German Federal Gazette and on the company's website at https://www.hamborner.de/en/investor-relations/general-shareholders-meeting.html.
CURRENT BUSINESS PERFORMANCE
In the current market environment, HAMBORNER is continuing to benefit from its stable and diversified portfolio and its high share of tenants of good credit, particularly in the area of food retail. At the same time, the lockdown imposed in mid-December 2020 meant that individual tenants affected by closures curtailed or suspended their rent payments in the months of January to March.
Across the portfolio as a whole, the rent collection rates (including ancillary costs and VAT) for this period averaged 94.6%. Depending on the duration and extent of the official restrictions, the company expects that a number of tenants will still be unable to (fully) honour their payment obligations. HAMBORNER is maintaining the corresponding dialogue with the tenants concerned and is confident that it will continue to find mutual and fair solutions.
In recent weeks, the company systematically continued the expansion and optimisation of its portfolio with the signature of the purchase agreement for an office property in Mainz. Currently fully let, the property is situated at an established office location and offers significant value potential that will be realised as part of the "manage to core" approach and on the basis of a comprehensive modernisation and re-letting concept.
In terms of sales activity, the company also signed contracts to sell a further two high street properties in Bad Homburg that are no longer consistent with its strategy.
Transfer of ownership is provisionally scheduled for the second quarter of 2021.
Taking the current business performance into account, the Management Board of HAMBORNER REIT AG published guidance for the current financial year in February 2021:
- Income from rents and leases of between ?82 million and ?86 million
- Funds from operations (FFO) of between ?45 million and ?50 million
- Net asset value (NAV) expected to reach the previous year's level
This forecast is subject to uncertainty largely stemming from non-recurring effects anticipated during the year whose influence on the revenue and earnings situation cannot be reliably estimated at the current time.
Further information on the assumptions underlying the guidance and the key factors can be found in the forecast report in the 2020 annual report, which is available to download from the company's website at https://www.hamborner.de/en/investor-relations/financial-reports.html.
FINANCIAL AND PORTFOLIO KEY FIGURES AS AT 31 DECEMBER 2020
|Income from rents and leases
|Profit for the period
|Funds from Operations (FFO)
|Funds from Operations (FFO) per share
|REIT equity ratio
|Loan to Value (LTV)
|EPRA Net Asset Value (NAV)
||?890.7 Mio. ?
|EPRA Net Asset Value (NAV) per share
|EPRA Net Tangible Assets (NTA)
||?890.2 Mio. ?
|EPRA Net Tangible Assets (NTA) per share
|Fair value of property portfolio
|EPRA vacancy rate
|Weighted remaining term of leases
ABOUT HAMBORNER REIT AG
HAMBORNER REIT AG is a public company listed in the SDAX that operates exclusively in the property sector and is positioned as a portfolio holder for high-yield commercial properties. The company generates sustainable rental income on the basis of a diversified portfolio of properties distributed throughout Germany with a total value of around ?1.6 billion. The portfolio focuses on modern office properties at established locations as well as local supply properties as large-scale retail assets, retail parks, DIY stores and attractive high street properties in major German cities and mid-sized centres.
HAMBORNER REIT AG is distinguished by its many years of experience on the property and capital market, its consistent and sustainable dividend policy and its lean and transparent corporate structure. The company is a registered real estate investment trust (REIT) and benefits from corporation and trade tax exemption at company level.
Head of Investor & Public Relations
Tel.: +49 (0) 203 54405-32
Fax: +49 (0) 203 54405-49
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