Adler Group Sa · XETR:ADJ
Adler Group Sa — FY2022 Earnings Presentation
43 slides from Adler Group Sa's earnings presentation, Apr 25, 2023
Slide 1: Results presentation
FY 2022 figures unaudited Results presentation 25 April 2023
Slide 2: Unaudited figures for FY 2022
Unaudited figures for FY 2022 In May 2022, KPMG informed Adler Group unexpectedly that it would no longer carry out the audit of the consolidated financial statements and annual accounts of Adler Group and its group companies. Since then, Adler Group has done everything in its power to engage an aud
Slide 3: Content
Content 1 Corporate Governance Update 2 Restructuring Plan 3 FY 2022 Overview 4 Financial Performance 5 2023 Guidance and Concluding Remarks 6 Appendix 3 Kaiserstraße, Berlin
Slide 4: Corporate Governance Update
Corporate Governance Update 4
Slide 5: Stabilising the Group in a Perfect Storm
Stabilising the Group in a Perfect Storm Financial restructuring providing stability and enhanced liquidity Process Special investigation on the allegations concluded Transparency Result: No fraud, just weak governance Results of special investigation reflected in disclaimer of opinion Implications
Slide 6: Restructuring Plan
Restructuring Plan 6
Slide 7: Adler Group's Strategy Centred Around Five Pillars
Adler Group’s Strategy Centred Around Five Pillars Berlin-anchored portfolio PORTFOLIO • Active disposal of selected portfolios & development projects with limited development STRATEGY • Limited development exposure to remain exposure ASSET • Finalise committed CAPEX on development projects1; no new
Slide 8: Summary of Notes Amendments and New Funding
Summary of Notes Amendments and New Funding The amendments and new funding provide stability and create a platform to maximise value • Quantum €937.5m • On 26 January 2023, the Group commenced the • Contractual maturity on 30 June 2025 restructuring plan, which aimed to facilitate the • Mandatory pr
Slide 9: FY 2022 Overview
FY 2022 Overview 9
Slide 10: Key Highlights
Key Highlights Strong operational performance and secured support via the restructuring plan PORTFOLIO FINANCIAL DISPOSALS & PERFORMANCE1 PERFORMANCE DEVELOPMENTS4 FY 2022 figures unaudited ◼ Lower NRI and FFO 1 on the back of ◼ Sale of Schönefeld Schule closed in Q4 2022 ◼ 1.5% like-for-like rental
Slide 11: Financial Performance
Financial Performance 11
Slide 12: GAV Slightly Decreased on the Back of Revaluation and Disposals
GAV Slightly Decreased on the Back of Revaluation and Disposals Downward revaluations on the back of rising interest rates impacted the Group's balance sheet GAV excluding BCP (€bn)1 Comments During the fourth quarter, a revaluation loss of (€101m) was realised on FY 2022 figures unaudited 1 the yie
Slide 13: EPRA LTV Bridge
EPRA LTV Bridge LTV impacted mostly by implementation of EPRA methodology and negative revaluation, while the calculations of the bond covenant LTV remained unchanged (FY 2022 LTV of 60.9%) EPRA LTV evolution1 (%) Comments Bond covenant LTV for FY 2022: 60.9% 2 74.5% EPRA LTV will be used as the Com
Slide 14: Debt Maturity Schedule
Debt Maturity Schedule Upcoming maturities covered by active refinancing, cash at hand and the New Money Funding Overview of debt maturities1 incl. BCP (€m) Comments FY 2022 figures unaudited Extension of €138m Adler Group 14% 18% 13% 23% 9% 4% 15% 4% bank debt (Lavlav) by two years Upcoming 2023 ma
Slide 15: Overview of Debt KPIs as per FY 2022
Overview of Debt KPIs as per FY 2022 Debt KPIs for FY 2022 Sources of funding Bond covenants Unsecured debt FY 2022 figures unaudited 67% Incurrence-based Required Total nominal interest-bearing debt (€m) 6,643 FY 2022 FY 2021 covenants level 2% LTV EPRA LTV 74.5%1 (Financial indebtedness / <60% 60.
Slide 16: Development of Cash Position
Development of Cash Position Solid liquidity position including €387m cash at hand to be expanded with additional liquidity from the agreement with bondholders Cash position, excluding BCP (€m) FY 2022 figures unaudited 27 49 615 19 175 29 20 387 Financial Performance Q3 2022 Yielding sales Project
Slide 17: 2023 Guidance and Concluding Remarks
2023 Guidance and Concluding Remarks 17
Slide 18: Guidance: Net Rental Income for FY 2023E of €207-219m
Guidance: Net Rental Income for FY 2023E of €207-219m NRI in the range of €207-219m for existing portfolio for FY 2023E Comments FY 2022 figures unaudited 1 Sale of approximately 14,400 units in Eastern regions to Velero/KKR for €1.0bn with majority of the assets transferred in April 2022 245 233-24
Slide 19: Concluding Remarks
Concluding Remarks Objectives Concluding remarks FY 2022 figures unaudited Approval of the restructuring plan safeguards Adler's Full-year 2023 guidance liquidity position and ensures its stabilisation Continued disposals efforts to rationalise the Group's balance sheet. Two additional projects sold
Slide 20: Q&A
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Slide 21: Appendix
Appendix 22 Corporate Structure 23-27 Portfolio & Operational Performance 28-34 Financials 35-38 Debt Overview 39-40 Development Projects 41 Corporate Governance 42 Corporate Agenda 21 Kaiserstraße, Berlin
Slide 22: Simplified Corporate Structure Post Amendments
Simplified Corporate Structure Post Amendments As part of the New Money Funding and the amendments to the notes, the Group will reorganise its corporate structure by transferring assets below several Holding LuxCos Adler Group S.A. FY 2022 figures unaudited 100% 100% Adler Group AGPS BondCo PLC1 Int
Slide 23: Continuous Increase in Portfolio Quality
Continuous Increase in Portfolio Quality Post disposals of non-strategic assets, a high-quality portfolio remains anchored in Berlin Standing assets as per FY 20221 Fair value (€/sqm) 3,015 2,938 GAV FY 2022 figures unaudited €5.2bn standing assets3 Berlin 1,887 LIKE-FOR-LIKE Oberhausen FAIR VALUE E
Slide 24: Strong Operational Performance Evidenced in Low Vacancy
Strong Operational Performance Evidenced in Low Vacancy... Portfolio valuation impacted in 2022 on the back of the rising interest rates Like-for-like fair value growth (%) Yielding portfolio operational vacancy rate2 (%) 10.1% 3.4% FY 2022 figures unaudited LIKE-FOR-LIKE FAIR VALUE DECREASE 6.7% (1
Slide 25: Combined with Increasing Average Monthly In-Place Rent
...Combined with Increasing Average Monthly In-Place Rent Residential and commercial Like-for-like residential rental Like-for-like rental growth Leases linked to consumer price average rent (€/sqm/m) growth (%) breakdown as per FY 2022 (%) index (CPI) as per FY 2022 (%) FY 2022 figures unaudited In
Slide 26: CAPEX and Maintenance in FY 2022
CAPEX and Maintenance in FY 2022 Total CAPEX and maintenance (€m) Maintenance expense (€/sqm) Maintenance CAPEX 8.9 FY 2022 figures unaudited 8.6 7.2 6.7 6.3 5.2 4.62 165 149 4.71 41 132 31 120 2016 2017 2018 2019 2020 2021 2022 34 23 95 CAPEX invested (€/sqm) 26.1 24.4 76 31 21.8 622 18.9 34 124 11
Slide 27: Portfolio Breakdown of Standing Assets and Developments
Portfolio Breakdown of Standing Assets and Developments Yielding portfolio per city, incl. BCP1 Development projects per city, incl. BCP2,3 # City Value (€m) Value (%) # City Value (€m) Value (%) FY 2022 figures unaudited 1 Berlin 4,487 69.0 1 Berlin 644 26.4 2 Duisburg 401 6.2 2 Düsseldorf 545 22.3
Slide 28: Profit and Loss Statement
Profit and Loss Statement P&L statement Comments FY 2022 figures unaudited In € million FY 2022 FY 2021 1 Compared to FY 2021, net rental income in FY 2022 has decreased to €245m mainly due to Net rental income 245 1 346 the reshaping of the yielding assets following the disposal of the Northern por
Slide 29: EBITDA from Rental Activities and EBITDA Total
EBITDA from Rental Activities and EBITDA Total EBITDA from rental activities EBITDA Total FY 2022 figures unaudited In € million FY 2022 FY 2021 In € million FY 2022 FY 2021 Net rental income 245 346 Income from rental activities 369 495 Income from facility services and recharged utilities costs 12
Slide 30: FFO
FFO 1 and FFO 2 FFO 1 calculation FFO 2 calculation FY 2022 figures unaudited In € million, except per share data FY 2022 FY 2021 In € million, except per share data FY 2022 FY 2021 Net rental income 245 346 EBITDA Total 95 1 208 Income from facility services and recharged utilities costs 125 149 Ne
Slide 31: Balance Sheet
Balance Sheet Balance sheet Comments FY 2022 figures unaudited In € million FY 2022 FY 2021 1 Fair value of investment properties has decreased in FY 2022 due to revaluation of the portfolio and Investment properties including advances 6,344 1 7,116 is impacted by portfolio disposals compared to FY
Slide 32: EPRA NAV Metrics
EPRA NAV Metrics EPRA NAV metrics calculation FY 2022 figures unaudited In € million, except per share data FY 20221 FY 20211 EPRA NAV metrics NAV NRV NTA NDV NAV NRV NTA NDV Total equity attributable to owners of the Company 5 1,417 1,417 1,417 2,990 2,990 2,990 2,990 Revaluation of inventories (2)
Slide 33: EPRA LTV - Methodology
EPRA LTV - Methodology EPRA LTV calculation for FY 2022 Comments FY 2022 figures unaudited Proportionate Consolidation Group as Share of joint Share of material Non-controlling In € million reported ventures associates interests2 Combined The main objective of EPRA’s LTV metric is to provide 1,646 –
Slide 34: EPRA LTV - Overview
EPRA LTV - Overview EPRA LTV Comments FY 2022 figures unaudited In € million FY 2022 FY 2021 1 Interest-bearing debts decreased compared to FY 2021 figures on the back of the 1,646 1 2,176 repayment of the €400m ADLER Real Estate 2019/2022 bond, the €120m convertible bond Borrowings from Financial I
Slide 35: Breakdown of Debt Maturities
Breakdown of Debt Maturities Volume (€m) IFRS (€m) Maturity Nominal interest rate Other comments Premature redemption Rate, at which premature redemption is possible ADLER Real Estate Bonds (unsecured) To be repaid 2017/24 300 296 6 Feb 24 2.10% Anytime Under condition of make whole FY 2022 figures
Slide 36: Debt Maturity per Entity
Debt Maturity per Entity Upcoming maturities covered by cash at hand and the New Money Facilities Overview of debt maturity per entity1 incl. BCP (€m) Breakdown per entity FY 2022 figures unaudited 14% 18% 13% 23% 9% 4% 15% 4% Adler RE (excl. BCP) 1,546 22.7% €400m Adler Group €300m Adler Real bond’
Slide 37: Covenants Overview: Adler Group
Covenants Overview: Adler Group Due to Adler Group's unsecured bonds having effectively been amended on 17 April 2023, the ratio-based incurrence tests have been removed. Adler Group now has fixed incurrence baskets and All Adler Group covenants are incurrence-based covenants a maintenance-based LTV
Slide 38: Covenants Overview: ADLER Real Estate
Covenants Overview: ADLER Real Estate All ADLER RE covenants are incurrence-based covenants except the ICR which is a maintenance-based covenant 1 LTV: Defined as net debt / total assets (<60%) 2 Secured LTV: Defined as secured debt / total assets (<40%) In € million In € million FY 2022 Pro forma2
Slide 39: Upfront Sale Projects
Upfront Sale Projects Progress in disposals despite difficult market conditions # Project name1 Entity City Zoning Building permit Construc. started Land plot (k sqm) Area (k sqm) PROJECTS SOLD 1 Parkhaus, Weg beim Jäger 206 2,3 Consus Hamburg ✓ ✓ Complete 7 n.a. €20m Arthur-Hoffmann-Straße4 ✓ F
Slide 40: Forward Sale and Condominium Projects
Forward Sale and Condominium Projects Majority of projects to be completed and handed over by 2023 Total Land remaining Construc. Building Construc. Area GAV2 GDV # Project name1 Entity City Zoning plot construc. period permit started (k sqm) (€m) (€m) (k sqm) CAPEX FY 2022 figures unaudited (€m) Fo
Slide 41: Adler Group Corporate Governance and Shareholder Composition
Adler Group Corporate Governance and Shareholder Composition Current composition of the Board and Senior Management Shareholder composition as per FY 20221,2 Prof. Dr. A. Stefan Kirsten FY 2022 figures unaudited Chairman of the Board Chairman of the Nomination & Compensation Committee Vonovia 20.5%
Slide 42: Corporate Agenda
Corporate Agenda Adler Group S.A. financial calendar 2023 Investor relations contacts 15 May 2023 German Spring Conference 2023 Gundolf Moritz FY 2022 figures unaudited Head of IR 25 May 2023 Publication Q1 2023 Results [email protected] 29 August 2023 Publication Q2 2023 Results Julian Mahle
Slide 43: Disclaimer
Disclaimer THIS PRESENTATION AND ITS CONTENTS ARE NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO OR FROM THE UNITED STATES OF AMERICA, CANADA, AUSTRALIA, JAPAN OR ANY JURISDICTION WHERE SUCH DISTRIBUTION IS UNLAWFUL. This presentation (“Presenta