Meinl European Land Limited

euro adhoc: Meinl European Land Limited
quarterly or semiannual financial statement
Meinl European Land posts substantial increases in revenues and earnings * Rental income more than doubles * Post-tax profit increases 80 percent to EUR 59 million

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Vienna, 29 September 2006. Meinl European Land is not only the largest property investor in CEE in the first half of 2006 as the international consultancy company CB Richard Ellis recently reports, the company has in the same period also continued its success story, with substantial increases in revenues and all earnings measures. The stock exchange listed property company lifted its revenues in the first six months from EUR 26.6m to EUR 58.5m, an increase of 120%, while rental income almost doubled. Rents in the first six months of EUR 43.6m have already reached 70% of total rental income for the whole of financial 2005. Operating profit (EBIT) also showed vigorous growth - up by roughly 65%, from EUR 34.8m to EUR 57.3m - while post-tax profits grew by an even more impressive 80%, from EUR 32.7m to EUR 58.8m.

For the whole of financial 2006, Meinl European Land is expecting to post total rental income amounting to around EUR 95m.

Portfolio includes development projects totalling EUR 3 billion

Meinl European Land’s dynamic growth is also reflected in the increasing size of the Group’s property portfolio: at 30 June 2006, it contained 181 properties, with a total value in excess of EUR 1.3 bn. This represents a year-on-year increase of almost 130%: (30.06.2005: EUR 593m).

The Group also has more than 20 contracted development projects, with an expected investment value of approximately EUR 1.7 bn. These consist in the main of large shopping centres in Russia, Poland and Turkey, and are scheduled for completion within the next two years.

Annual rental income for the whole portfolio, including development projects, is estimated to total some EUR 270m.

Value of development projects rises by EUR 200m

The majority of Meinl European Land’s development projects are forward purchase agreements: the projects are transferred on completion on the basis of contractually agreed yields. Since these yields are significantly higher than current market yields on comparable properties, there is considerable potential for capital appreciation, which Meinl European Land can realise once the projects are completed. Based on current market yields, the market value of completed developments exceeds their agreed transfer price or the expected development costs by roughly EUR 200m. Assuming further yield compression in Eastern Europe, there is scope for the upside potential to increase even further by the time projects presently under development are completed.

The recently completed 25,000 m2 centre in Riga, the capital of Latvia, is a prime example: the yield agreed with the developer at which Meinl European Land acquired the site upon completion was 9.63%. Market yields today for a comparable shopping centre are roughly 6.75%, resulting in an increase in value of 30%.

Increase in net asset value per share

Net asset value per share (NAV) at 30 June 2006 was EUR 14.36 versus one year ago EUR 13.09, an annual increase of about 10%. This NAV calculation excludes capital appreciation on development projects, which, at cost value, form 60% of the total portfolio. The estimated upside on development projects of EUR 200m would lift NAV to EUR 15.47 per share. The stock market price at 30 June 2006 was EUR 15.93, only 3% higher than NAV. Significant further value of the company lies in the project pipeline and the management’s ability to source new deals.

Project pipeline of more than EUR 2 billion

A project pipeline of more than EUR 2 bn means that further growth is assured. The projects in the pipeline are still under evaluation. Projects with a total value of approximately EUR 500m, most of them in Russia and Poland, are expected to be signed in the near future.

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ots Originaltext: Meinl European Land Limited
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Further inquiry note:
Pleon Publico Public Relations & Lobbying
Mag. Claudia Müller-Stralz
Tel.: ++43 (0) 1/717 86 107

Branche: Real Estate
ISIN:      AT0000660659
WKN:        066065
Index:    Standard Market Auction
Börsen:  Wiener Börse AG / official dealing

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