9M 2022 Interim Statement

PATRIZIA SE | 9M 2022 Interim Statement

Content

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Highlights & operational results .....................................................................................................................................

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2

Development of key financial performance indicators (KPIs) .......................................................................................

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Capital allocation.............................................................................................................................................................

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Consolidated income statement.....................................................................................................................................

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Consolidated statement of comprehensive income ....................................................................................................

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Consolidated balance sheet..........................................................................................................................................

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Guidance for the fiscal year 2022 ................................................................................................................................

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Responsibility statement by the legal representatives ...............................................................................................

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The PATRIZIA share .......................................................................................................................................................

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Supplementary report ...................................................................................................................................................

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Appendix ........................................................................................................................................................................

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PATRIZIA SE | 9M 2022 Interim Statement

1 Highlights & operational results

PATRIZIA is a leading partner for global real assets and one of the leading independent real estate investment companies in Europe. Its clients include institutional, semi-professional and private investors such as insurance firms, pension and sovereign wealth funds from Germany, Europe, the US and Asia.

In a weakening market environment, PATRIZIA has achieved an EBITDA of EUR 78.8m in the first nine months of 2022, reflecting a decline of 17.2% y-o-y. However, Assets under Management (AUM) and the associated recurring management fees continued to grow, almost offsetting the declines in transaction and performance fees. In addition, the profitable deconsolidation of a project development temporarily held on the balance sheet had a positive impact of EUR 17.8m on EBITDA during the first nine months of 2022.

AUM increased 17.4% y-t-d to EUR 57.1bn as at 30 September 2022 (31 December 2021: EUR 48.6bn) which was driven by the completion of the Whitehelm Capital M&A transaction, continued organic growth and positive valuation effects. In PATRIZIA's broad-based product portfolio, infrastructure investments for national and international clients now represent 10.8% of AUM (3.6% as at 31 December 2021). The geographical distribution of AUM showed further progress in internationalisation with a share of 47.0% of AUM invested outside of Germany (AUM outside of Germany as at 31 December 2021: 40.0%).

Although the transaction market for real estate and infrastructure slowed down over the course of the first nine months of 2022 due to increased geopolitical risks, high inflation and rising interest rates, PATRIZIA was able to sign transactions of around EUR 4.5bn (+20.2% y-o-y) for its global clients. In the same period, EUR 5.0bn in transactions were closed, an increase of 52.8% y-o-y.

Total service fee income of EUR 248.3m was slightly below previous year's level of EUR 255.0m. In particular, recurring management fees of EUR 184.1m (EUR +29.3m or +18.9% y-o-y) almost compensated for the decline in performance fees of EUR 49.8m (EUR -16.4m or -24.8%y-o-y) and transaction fees down to EUR 14.5m (EUR -19.5m or -57.3%y-o-y). This is testament to PATRIZIA reaching a further milestone in its journey towards becoming a more diversified investment manager with an increasingly recurring earnings profile.

Net sales revenues and co-investment income increased by 16.4% y-o-y to EUR 7.9m, with the growth primarily driven by the disposal of one of the last remaining balance sheet properties in the UK, supporting revenues with EUR 2.0m.

Net operating expenses increased by 6.5% y-o-y to EUR 177.4m. This is attributable to higher staff costs due to the increased number of employees following the acquisition of Whitehelm Capital, as well as one-off effects from the consolidation of the latter and further strategic investments. The profitable deconsolidation of a project development held temporarily on the balance sheet ("Silver Swan") had a relieving effect of EUR 17.8m on net operating expenses at the same time.

EBITDA for the first nine months of 2022 amounted to EUR 78.8m, which corresponds to a decrease of 17.2% compared to the same period of the previous year.

Contrary to previous assumptions, PATRIZIA no longer expects the geopolitical environment in Europe to stabilise in the short term or market conditions - especially in the European real estate market - to materially improve in the fourth quarter of this year.

In addition, the company notes that the speed and extent to which planned investments (especially European real estate) are put on hold, has recently accelerated due to an increased sense of hesitation in the market to commit to new investments, which the company however sees as temporary in nature.

This affects PATRIZIA in particular in its forecast for transaction fees, which has to be lowered significantly. Due to delayed investments, the guidance for growth in assets under management and for management fees for FY 2022 has to be adjusted as well, albeit to a relatively low degree. In addition, the company has to adjust its guidance for the financial year 2022 in further revenue and cost positions, the latter primarily driven by one-off items.

Overall, PATRIZIA now expects an EBITDA range before reorganisation expenses of EUR 70.0 - 85.0m for FY 2022 and an EBITDA range of EUR 60.0 - 75.0m, including such one-off expenses.

The planned one-off expenses comprise measures to adjust the company's cost base, rebalance it for selected growth initiatives and to improve long-term profitability.

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PATRIZIA SE | 9M 2022 Interim Statement

That said, PATRIZIA remains well positioned with a solid net equity ratio of 72.6% and available liquidity of EUR 360.8m, both of which enable PATRIZIA to seize opportunities wherever and whenever they will arise.

Finally, PATRIZIA continues its transformation to a company with higher level of recurring income. This is being enabled by an increased focus on German and international flagship investment strategies and discretionary capital, as well as the continued global diversification of the company's product offering (across equity, debt and public listed funds) and its capital raising. Its growing infrastructure footprint will continue to boost PATRIZIA's product offering especially in the areas related to sustainability and energy transition for the benefit of its German and international client base and shareholder base.

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PATRIZIA SE | 9M 2022 Interim Statement

2 Development of key financial performance indicators (KPIs)

2.1 Assets under Management (AUM)

Assets under Management (EUR bn)

31.12.2021

47.5

1.1

48.6

+17.4%

9M 2022

56.3

0.8

57.1

2022e

57.0 - 58.0

Funds under management Fund of funds

Assets under Management as at 30 September 2022 | Sectoral distribution

3%3%

Office

3%

Residential

11%

30%

Retail

14%

Logistics, Industrial & Light Industrial

Infrastructure

Hotel

11%

Health Care

27%

Other

Assets under Management as at 30 September 2022 | Geographical distribution

4% 8%

Germany

UK & Ireland

2%

France & Belgium

5%

3%

Nordics

7%

53%

Australia

Netherlands

6%

Italy

12%

Spain

Other

  • AUM increased 17.4% to EUR 57.1bn for the first nine months of 2022 compared to EUR 48.6bn at year-end 2021 driven by the closing of the Whitehelm Capital acquisition as at 1 February 2022, further organic growth as well as positive valuation effects.

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Patrizia AG published this content on 09 November 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 09 November 2022 16:40:03 UTC.