euro adhoc: ECO Business-Immobilien AG
quarterly or semiannual financial
statement
ECO Business-Immobilien AG with strong earnings growth for 1-9/2007:
EBIT rises by 98%
Disclosure announcement transmitted by euro adhoc. The issuer is responsible for the content of this announcement.
16.11.2007
ECO Business-Immobilien AG with strong earnings growth for 1-9/2007: EBIT rises by 98%
Vienna, 16 November 2007. ECO Business-Immobilien AG, which is listed in the Prime Market segment of the Vienna Stock Exchange, successfully continued its selective growth course during the third quarter of 2007. During the first nine months of this year, organic growth combined with the active management of the property portfolio and selective acquisitions led to higher rental revenues and an increase in the value of properties, while the expansion of trading activities generated higher gains on sale. Improvements were registered in all earnings indicators: EBIT rose by 98% to EUR 40.8 million for the first three quarters of 2007, and the property portfolio grew to EUR 755.5 million following the acquisition of selected properties.
Revenues and earnings improved significantly during the first three quarters of 2007. Rental income rose by 36% year-on-year to EUR 35.8 million. This sound development was based above all on organic effects and new rentals in the existing portfolio as well as acquisitions in Austria and Germany. The sale of properties as part of trading activities generated a gain of EUR 6.0 million (1-9/2006: EUR 1.5 mill.). The profit margin equalled roughly 15% based on the latest recorded values. The adjustment of the property portfolio to reflect fair value in accordance with IFRS contributed EUR 13.5 million to earnings. These revaluations resulted above all from specially designed measures as part of the Group´s asset management activities as well as an increase in the market values of objects in attractive locations, and totalled roughly 2% of investment property.
This favourable development led to an improvement of 98% in operating profit (EBT) to EUR 40.8 million. Profit before tax (EBT) increased 126% to EUR 27.3 million. Profit for the year (after minority interest) rose to EUR 20.1 million, for an increase of 120% over the comparable prior year period. Funds from operations (FFO) equalled EUR 13.4 million, compared with EUR 9.0 million for the first three quarters of 2006. Earnings per share for the reporting period rose from EUR 0.52 to EUR 0.73.
Net asset value (NAV) increased 5.5% within a single year to EUR 12.04 per share. Since 2004 NAV per share has risen by an average of 5.8% per year.
ECO not only expanded its property portfolio throughout the first three quarters of 2007, but also improved the attractiveness of the individual objects through active management. In the current market environment ECO has taken an extremely cautious approach to acquisitions, in order to make optimal use of liquidity shortages experienced by other market participants as a result of the financial market crisis.
As of 30 September 2007 the property portfolio comprised 113 objects with a total value of EUR 755.5 million, which reflects an increase of EUR 57.2 million since the end of 2006. Within one year, the value of the property portfolio has grown by EUR 103.6 million. The total rentable space in the portfolio rose to approx. 481,200 m².
Sales from the trading portfolio also generated sound gains: 20 properties, one development project and five apartments with a combined value of approx. EUR 38.2 million were sold at a profit during the first nine months of 2007.
ECO plans further investments in the core markets of Austria and Germany as well as the CEE region during the last three months of 2007. The value of the portfolio including current development projects should increase to more than EUR 1 billion within the near future in relation to the acquisition projects currently under negotiation.
The Management Board of ECO expects a significant improvement in revenues and earnings over the previous year as a result of the sound development of business during the first nine months of 2007 as well as attractive investment opportunities and the further potential for an increase in the value of the existing portfolio.
Company Data in TEUR (in accordance with IFRS)
01-09/2007 01-09/2006 01-12/2006
Rental revenues 35,818 26,370 38,803 Thereof rental income 29,369 22,498 32,129 Gain on the disposal of non-current assets 5,973 1,492 9,819 Changes in the fair value of investment property 13,487 2,944 6,067 Operating profit (EBIT) 40,833 20,602 38,280 Profit before tax (EBT 27,303 12,107 24,739 Profit for the year (after minority interest) 20,149 9,178 17,900 Earnings per share (EUR) 0.73 0.52 0.99 Average number of shares outstanding 34,100,000 22,500,000 25,000,000 Cash flow from operating activities 2,271 -1,651 1,533 FFO (funds from operations) *) 13,379 9,048 16,957 NAV per share (EUR) 12.04 11.41 11.79
*) Profit before tax + depreciation and amortisation +/- fair value adjustments - income tax payments
Property Data
01-09/2007 01-09/2006 01-12/2006
Number of objects 113 146 126 Thereof investment portfolio 60 68 54 Thereof trading portfolio 52 77 71 Thereof CEE portfolio 1 1 1 Total rentable space in m² * 481,200 444,700 463,400 Thereof trading portfolio 46,500 44,200 57,400 Garage spaces (number) 2,432 1,977 2,339 Thereof trading portfolio 291 199 289 Property portfolio (in TEUR) 755,412 650,841 697,223 Thereof properties under construction 30,488 0 3,892 Thereof trading portfolio 61,803 73,885 94,445
* Garage spaces were included at 20m² each.
ECO has advanced the announcement of key data on the first three quarters of 2007 from 23 November to today, 16 November 2007, because of discussions with investors. The full report on the third quarter of 2007 will be published as planned on 23 November 2007 and will also be available under www.eco-immo.at as of this same date.
end of announcement euro adhoc 16.11.2007 08:17:50
Further inquiry note:
ECO Business-Immobilien AG
Friedrich Scheck, Chairman of the Management Board
Tel +43 1 535 21 99
E scheck@eco-immo.at
Hochegger|Financials
Roland Mayrl
Tel +43 1 504 69 87-31
E r.mayrl@hochegger.com
Branche: Real Estate
ISIN: AT0000617907
WKN: A0D8RY
Index: Prime.market
Börsen: Wiener Börse AG / Regulated free trade