Adler Group Sa · XETR:ADJ
Adler Group Sa — H1 2022 Earnings Presentation
42 slides from Adler Group Sa's earnings presentation, Aug 30, 2022
Slide 1: Results presentation
Results presentation 30 August 2022
Slide 2: Content
Content 1 Recent Events 2 H1 2022 Overview 3 Portfolio & Operational Performance 4 Financial Performance 5 Guidance 6 Appendix 2 Braunschweiger Strasse, Berlin
Slide 3: Recent Events
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Slide 4: Corporate Governance Update
Corporate Governance Update Making progress but some issues still have to be resolved The tender process was started immediately after the annual General Meeting, has now been Audit completed and has not led to any result. Therefore, individual auditing companies are currently being approached direc
Slide 5: Numerous Steps Taken to Reshape the Group and Improve its Corporate Governance in 2022
Numerous Steps Taken to Reshape the Group and Improve its Corporate Governance in 2022 CORPORATE GROUP PORTFOLIO GOVERNANCE REORGANISATION DISPOSALS ◼ 21 April: Publication of the outcomes of the ◼ 17 April: Repayment of €400m ADLER Real ◼ 30 June: Adler Group sells 1,200 units in special investigat
Slide 6: H1 2022 Overview
H1 2022 Overview 6
Slide 7: Key Highlights
Key Highlights Robust operational performance, adequate liquidity position PORTFOLIO FINANCIAL DEVELOPMENT PERFORMANCE PERFORMANCE PROGRESS ◼ 2.3% like-for-like rental growth1 ◼ Lower NRI and FFO 1 on the back of the ◼ €166m cash proceeds received regarding the disposal of assets: sale of Ostend Qua
Slide 8: Portfolio & Operational Performance
Portfolio & Operational Performance 8
Slide 9: Continuous Increase in Portfolio Quality
Continuous Increase in Portfolio Quality Post non-strategic disposals, a high-quality portfolio remains anchored in Berlin Standing assets as per H1 20221 Fair value (€/sqm) 3,061 3,015 GAV €5.4bn standing assets 3 Berlin 2,016 1,887 LFL fair Oberhausen value growth Essen Duisburg Dortm und Portfoli
Slide 10: Reshaping the Portfolio Decreases Vacancy…
Reshaping the Portfolio Decreases Vacancy… Like-for-like fair value growth (%) Yielding portfolio operational vacancy rate3 (%) 10.1% 3.8% LIKE-FOR-LIKE 3.4% FAIR VALUE GROWTH 6.4% 6.0% YoY (vs H1 2021) Portfolio & Operational Performance 1.6% VACANCY 1.1% DECREASED BY 2.3% 2.2% YoY (vs H1 2021) FY
Slide 11: … and Increases the Average Monthly In-Place Rent
… and Increases the Average Monthly In-Place Rent Residential and commercial average rent Like-for-like residential rental growth (%) Like-for-like rental growth breakdown2 (%) (€/sqm/m) 7.45 7.47 4.3% 2.7% 2.3% 6.55 6.30 1.0% 2.5% 2.3% 2.2% Berlin All other cities Total portfolio Portfolio & Operat
Slide 12: Financial Performance
FIADLER GROUP. Financial Performance
Slide 13: One-off Non-Cash Impairments Impact the Group's Earnings
One-off Non-Cash Impairments Impact the Group’s Earnings Including impairment of receivables and negative revaluation of development projects Net income H1 2022 (€m) Comments 1 Net operating income from rental activities totals €195m and consists of net rental income of €131m, income from facility s
Slide 14: Total GAV Decreased to €7.9bn
Total GAV Decreased to €7.9bn Further sale of yielding assets and impairment of development projects decreased the Group’s balance sheet GAV excluding BCP (€bn)1,2 Comments 1 Kreuzstraße development project has been sold in April 2022 8.3 The sale of New Frankfurt Towers and Vitopia Kaiserlei Reside
Slide 15: Increasing LTV in Q2 on the back of One-off, Non-Cash Impairments
Increasing LTV in Q2 on the back of One-off, Non-Cash Impairments LTV evolution1,2 (%, incl. convertibles) Comments 58.0% 1 Kreuzstraße development project has been sold in April 2022 1.7% 0.6% 2 Positive value changes on the back of revaluation of the yielding portfolio offset by the impairment of
Slide 16: Balanced Debt Maturity Schedule
Balanced Debt Maturity Schedule Upcoming maturities covered by cash at hand and active disposals Overview of debt maturities1 incl. BCP (€m) Comments Upcom ing m aturities are 4% 15% 16% 12% 22% 8% 5% 18% covered through a combination of €901m 2 cash on hand as per H1 2022 and active capital recycli
Slide 17: Overview of Debt KPIs as per H1 2022
Overview of Debt KPIs as per H1 2022 Debt KPIs for H1 2022 Sources of funding Bond covenants Unsecured debt 64% Incurrence-based Required Total nominal interest-bearing debt (€m) 7,061 H1 2022 FY 2021 covenants level 1,2 3% LTV Net LTV 58.0% <60% 53.02 54.5%2 (Financial indebtedness / total assets)
Slide 18: Development of Cash Position
Development of Cash Position €771m cash position; €534-634m expected by YE 20222 Cash position excluding BCP cash (€m)1 Expected cash in and outflows for the remainder of 2022 17 450-550 599 Offer received / LOI / exclusivity 319 639 Signed / Closed since H1 142 760 20 771 26 7 219 534-6342 Financia
Slide 19: Guidance
Guidance 19
Slide 20: Guidance for 2022 Updated
Guidance for 2022 Updated Objectives Concluding remarks Yielding asset portfolio value increased by €124m resulting in a +2.3% LFL value uplift during the first half Full-year 2022 guidance 1 of 2022 on the back of a +2.3% LFL rent increase Operational vacancy of the total portfolio at a structurall
Slide 21: Q&A
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Slide 22: Appendix
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Slide 23: H1 2022 – Changing Company KPIs
H1 2022 – Changing Company KPIs Balance sheet reshaping results in a focused, higher quality portfolio H1 2022 H1 2021 Delta YoY (%) Comments • c. €3.9bn of non-strategic disposals and BCP1 GAV – Yielding Assets (€m) 5,443 8,885 (38.7) • c. €0.4bn revaluation of the yielding assets • c. €0.6bn sales
Slide 24: Profit and Loss Statement
Profit and Loss Statement P&L statement Comments In € million H1 2022 H1 20211 1 Compared to H1 2021, net rental income in H1 2022 have decreased to €131m mainly due Net rental income 131 1 174 to the reshaping of the yielding assets follow ing the dis posal of the Northern portfolio to LEG and the
Slide 25: EBITDA from Rental Activities and EBITDA Total
EBITDA from Rental Activities and EBITDA Total EBITDA from rental activities EBITDA Total In € million H1 2022 H1 2021 In € million H1 2022 H1 20211 Net rental income 131 174 Income from rental activities 195 231 Income from facility services and recharged utilities costs 65 56 Income from property
Slide 26: FFO
FFO 1 and FFO 2 FFO 1 calculation FFO 2 calculation In € million, except per share data H1 2022 H1 2021 In € million, except per share data H1 2022 H1 20211 Net rental income 131 174 EBITDA total (10) 1 110 Income from facility services and recharged utilities costs 65 56 Net cash interest (45) (55)
Slide 27: Balance Sheet
Balance Sheet Balance sheet Comments In € million H1 2022 FY 2021 1 The decrease in fair values of the build-to-hold project developments and the yielding investment Investment properties including advances 6,834 1 7,116 properties reflects the disposal of Waypoint and the development value reductio
Slide 28: EPRA Metrics
EPRA Metrics EPRA metrics calculation In € million, except per share data H1 20221 FY 20211 EPRA m etrics NAV NRV NTA NDV NAV NRV NTA NDV Total equity attributable to ow ners of the Company 2,389 2,389 2,389 2,389 2,990 2,990 2,990 2,990 Revaluation of inventories (100) (100) (100) (100) 8 8 8 8 Def
Slide 29: Net LTV
Net LTV LTV calculation Comments In € million H1 20221 FY 20211 1 The selected financial assets have declined to (€354m) and contain purchase price Corporate bonds and other loans and borrow ings 6,717 7,440 receiv ables amongst others. They include 1) netted financial receivables (€262m), 2) trade
Slide 30: Covenants Overview: Adler Group
Covenants Overview: Adler Group All Adler Group covenants are incurrence-based covenants 1 LTV: Defined as net debt / total assets (<60%) 2 Secured LTV: Defined as secured debt / total assets (<45%) Secured debt In € million In € million H1 2022 Pro forma3 H1 2022 Pro forma3 Pro forma3,4 Consolidate
Slide 31: 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%) Secured debt In € million In € million H1 202
Slide 32: Breakdown of Debt Maturities
Breakdown of Debt Maturities Volum e (€m) IFRS (€m ) Maturity Nom inal interest rate Other comments Prem ature redemption Rate, at w hich premature redemption is possible ADLER Real Estate Bonds (unsecured) 2017/24 300 294 6 Feb 24 2.10% Anytime Under condition of make w hole 2018/23 500 496 28 Apr
Slide 33: Reassessment of Receivables to Pave Path for the Future
Reassessment of Receivables to Pave Path for the Future Adler Group continues its efforts to materialise these financial assets Overview of selected financial assets Right of w ithdrawal Receivables (€m) Receivables (€m) # Description Type Delta (€m ) Com ment on delta / security per H1 2022 per Q1
Slide 34: CAPEX and Maintenance in H1 2022
CAPEX and Maintenance in H1 2022 Total CAPEX and maintenance (€m) Maintenance expense (€/sqm) PROCUREMENT Maintenance OPTIMISATION 8.9 CAPEX 8.6 AND INCREASED SCALE 7.2 6.7 6.3 5.2 165 2.8 149 2.0 41 132 31 120 2016 2017 2018 2019 2020 2021 H1 H1 34 2021 2022 23 95 CAPEX invested (€/sqm) 26.1 CAPEX
Slide 35: Build-to-Hold Projects
Build-to-Hold Projects Two projects under construction Total Construc. 3 rem aining Construc. Building Construc. Land plot Area Land value CAPEX GAV GDV YoC # Project name1,2 City Zoning construc. period permit started (k sqm) (k sqm) (€m) spent (€m) (€m) (%) CAPEX (€m) (€m) Wasserstadt 1 Berlin 201
Slide 36: Upfront Sale Projects
Upfront Sale Projects Eleven projects under construction # Project name1 City Construc. period Zoning Building permit Construc. started Land plot (k sqm) Area (k sqm) 2 1 Ostend Quartier Frankfurt 2023 - 2027 12 44 2 Westend Ensemble - Upper West - LEA B2 Frankfurt 2019 - 2023 ✓ ✓ 14 20 PROJ
Slide 37: Forward Sale Projects
Forward Sale Projects Four projects under construction Total remaining Construc. Construc. Land plot Area GAV 1 construc. GDV # Project name City Zoning Building permit period started (k sqm) (k sqm) (€m) CAPEX (€m) (€m) Quartier Bundesallee und 1 Berlin 2016 - 2022 ✓ ✓ ✓ 3 7 33 13 46 Momente Königs
Slide 38: Condominium Projects
Condominium Projects Two projects under construction Total remaining 1 Construc. Construc. Land plot Area GAV 2 construc. GDV # Project name City Zoning Building permit period started (k sqm) (k sqm) (€m) CAPEX (€m) (€m) Westend Ensemble - 1 Frankfurt 2017 - 2022 ✓ ✓ ✓ 14 9 75 18 92 Grand Ouest - LE
Slide 39: Shareholder Structure
Shareholder Structure Largest shareholders Vonovia 20.5% 7.4% Gerda Caner 6.1% 66.0% Aggregate Holdings Free Float Appendix 39
Slide 40: Overview of the Composition of the Board
Overview of the Composition of the Board Current composition of the Board Remarks Prof. Dr. A. Stefan Kirsten Re-appointment of each Board member until 2025 during the AGM on Chairman of the Board June 2022 underpinning Shareholders’ endorsement Chairman of the Nomination & Compensation Committee Ap
Slide 41: Corporate Agenda
Corporate Agenda Adler Group S.A. financial calendar 2022 Investor relation contacts 29 August 2022 Publication Q2 2022 results Gundolf Moritz Head of IR 29 November 2022 Publication Q3 2022 results [email protected] 30 November 2022 Germ an Equity Forum Julian Mahlert Senior IR Manager j.mah
Slide 42: 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