Adler Group Sa · XETR:ADJ
Adler Group Sa — ADO Properties — Q1 2020 Earnings Presentation
39 slides from Adler Group Sa's earnings presentation, May 18, 2020
Slide 1: First quarter 2020 results presentation
First quarter 2020 results presentation Berlin – 18 May 2020
Slide 2: Today's presenters
Today’s presenters Thierry Beaudemoulin Maximilian Rienecker Co-Chief Executive Officer Co-Chief Executive Officer Operations & Development Financial Management & Capital Markets 2
Slide 3: Agenda
Agenda 1 Takeover of ADLER completed and next steps 2 Well diversified €8.6bn German residential portfolio 3 First quarter 2020 results 4 Update on developments 5 Outlook 6 Appendices 3
Slide 4: Developments on Mietendeckel and COVID-19
Developments on Mietendeckel and COVID-19 ◼ On 6 May, politicians of a combination of CDU/CSU and FDP – supported by 200 members of the Parliament - have asked Germany’s Federal constitutional court to review the legal grounds of the Berlin government’s decision to freeze rents for five years (“Norm
Slide 5: 1. Takeover of ADLER completed and next steps
1. Takeover of ADLER completed and next steps
Slide 6: Public offer for ADLER – key milestones
1. Public offer for ADLER – key milestones Date Key achievements and activities 15 December 2019 ▪ Announcement of transaction for ADLER and 22% of Consus 7 February 2020 ▪ Publication of offer document and start offer period 6 March 2020 ▪ End of initial acceptance period | 82.82% of shares tendere
Slide 7: Successful public offer for ADLER
1. Successful public offer for ADLER Acquisition Financing secured Integration started Next steps completed ▪ €3.5 billion (100%) of ADLER ▪ Settlement executed on 9 April ▪ Maximilian Rienecker ▪ Launched public offer for debt secured via waivers of 2020 appointed as Co-CEO of ADO remaining 3.1% We
Slide 8: Consus divests development projects with a €2.3bn GDV
1. Consus divests 17 development projects with a €2.3bn GDV ◼ Consus has sold 17 development projects with a GDV of €2.3bn to Gröner Group GmbH Sale of €2.3bn ◼ Sold portfolio includes primarily projects in non-core locations projects ◼ The projects sold have over 50% planned as commercial areas Rea
Slide 9: 2. €8.6bn German residential portfolio
2. €8.6bn German residential portfolio
Slide 10: Well diversified €8.6bn German residential portfolio
2. Well diversified €8.6bn German residential portfolio Creating a well balanced geographical portfolio of ADO and ADLER Development of number of units over time1 100,000 ADLER Real Estate ADO Properties Gewobag 5,900 units 80,000 75,810 60,000 40,000 20,000 0 2015 2016 2017 2018 2019 1Q20 Developme
Slide 11: Top cities account for 77% of the residential value
2. Top 13 cities account for 77% of the residential value Key portfolio metrics Key cities in a well diversified portfolio Fair Value Fair Value Lettable area *NRI Rental yield Vacancy Vacancy 1Q20 Avg. Rent NRI Location Units €m 1Q20 €/sqm 1Q20 sqm €m 1Q20 (in-place rent) 1Q20 Δ YoY €/sqm/month Δ Y
Slide 12: 3. First quarter 2020 results
3. First quarter 2020 results
Slide 13: Highlights of ADO Properties & ADLER Real Estate 1Q20
3. Highlights of ADO Properties & ADLER Real Estate 1Q20 ▪ €88.1m of NRI (€27.9m for ADO and €60.2m for ADLER), down from €98.5m in 1Q19 (€33.7m for ADO and €64.8m for ADLER) due to disposals ▪ €6.2/sqm/month average residential rent (€7.3 for ADO and €5.6 for ADLER), up from €6.0 in 1Q19 (€6.8 for
Slide 14: Joint operational performance
3. Joint operational performance Total number of units Investment properties (€m) Combined residential portfolio FV/sqm (€) 100,000 ADLER Real Estate ADO Properties 1,800 1,635 1,633 10,000 ADLER Real Estate ADO Properties 1,553 1,552 1,600 1,452 80,000 8,000 1,400 1,215 23,658 17,638 17,620 4,050 3
Slide 15: Further lowering of the combined cost of debt to 1.8%
3. Further lowering of the combined cost of debt to 1.8% Recent developments Combined loan to value1 ▪ In February 2020, c.€300m of non-euro bonds of ADO Group were fully 70% 63.3% repaid. The repayment was funded through cash and a €175m increase in the 60% 52.9% 53.8% 54.6% 51.0% existing ADLER €7
Slide 16: Actively extending maturities with €533m under discussion
3. Actively extending maturities with €533m under discussion Recent developments Combined debt maturity schedule (€m) ▪ S&P fundamental analysis of the business risk profile remains unchanged 2,000 and was moved to the better end of its satisfactory category. S&P's anchor 1,549 score is BBB- based o
Slide 17: 4. Update on developments
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Slide 18: Developments driving growth in the top German cities
4. Developments driving growth in the top 9 German cities Map of top 9 cities Comments Focus on top 9 German cities ▪ Housing shortage is the highest in the larger cities ▪ Rental prices and values will continue to rise in the largest cities ▪ Above average population growth in largest cities to con
Slide 19: Increased focus on developments in top German cities
4. Increased focus on developments in top 9 German cities ◼ Adding housing stock in cities with high housing shortage (Wolfsburg and Göttingen in the ADLER portfolio) Extensions / ◼ Development of new apartments in combination with significant tenant improvements increasing occupancy modernisations
Slide 20: Extensions and redevelopments in rental portfolio
4. Extensions and redevelopments in rental portfolio Solving local housing shortage via densification within own portfolio Wolfsburg & Göttingen – realising additional value Tenant improvements & modernisations ▪ Wolfsburg and Göttingen are two key cities in the 4 million Hanover- ▪ Modernisation of
Slide 21: 5. Guidance
5. Guidance
Slide 22: 1Q20 reporting for ADO and ADLER was still standalone
5. 1Q20 reporting for ADO and ADLER was still standalone Net Rental Income (€m) FFO I (€m) 88.1 30.6 19.1 60.2 11.5 27.9 ADO Q1 2020 ADLER Q1 2020 Combined Pro Forma ADO Q1 2020 ADLER Q1 2020 Combined Pro Forma 22
Slide 23: Guidance and outlook 2020
5. Guidance and outlook 2020 Objectives 2020 Key takeaways 2020 Pro-forma 2020 Guidance Guidance (i.e. combining the (i.e. combining the companies as of the companies for the whole effectuation in April 2020) ▪ Acquisition of ADLER succesfully completed year 2020) Net rental income €280-300m €340-36
Slide 24: Contact
Contact ADO Properties and ADLER Real Estate Tina Kladnik Head of IR E-mail: [email protected] +49 162 424 68 33 24
Slide 25: 6. Appendices
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Slide 26: Overview of debt instruments
Overview of debt instruments
Slide 27: Overview of combined debt instruments
Overview of combined debt instruments Instruments at 31 March 2020 Book value Volume €m Maturity Nominal interest rate Other comments Premature redemption Rate, at which premature redemption is possible €m Adler Bonds 2017/21 498 500 06 Dec 2021 1.50% Anytime Under condition of make whole 2017/24 29
Slide 28: ADO Properties – First quarter 2020 financials
ADO Properties First quarter 2020 financials
Slide 29: ADO – Portfolio KPI's
ADO – Portfolio KPI’s Total number of residential units Investment properties (€m) Residential portfolio FV per sqm (€) 3,500 25,000 4,500 2,966 2,968 4,000 3,000 20,000 2,488 2,495 3,500 2,500 2,198 3,000 15,000 2,000 1,836 2,500 23,658 1,407 21,970 2,000 4,050 1,500 10,000 18,700 3,306 3,631 3,627
Slide 30: ADO - Profit and loss statement
ADO - Profit and loss statement Profit and loss statement per 31 March 2020 Comments In €m, except per share data 1Q 2020 1Q 2019 1 Net rental income has decreased due to disposal of 20% of the portfolio to 1. Net rental income 28 1 34 Gewobag and the impact of the Mietendeckel. 1Q20 would reflect a
Slide 31: ADO - Statement of other comprehensive income
ADO - Statement of other comprehensive income Other comprehensive income per 31 March 2020 Comments In €m, except per share data 1Q 2020 1Q 2019 1 Reserve financial asset measures the difference in value of the strategic 1. Profit for the year -3 10 stake in Consus between the acquisition date and t
Slide 32: ADO - Balance sheet
ADO - Balance sheet Balance sheet per 31 March 2020 Comments In €m 1Q 2020 FY 2019 1 The fair value of the portfolio was last assessed by CBRE as at Dec 31, 2019 1. Investment properties including advances 3,627 1 3,631 and amounted to €3,624m, during the quarter €2.5m of capex was invested Investme
Slide 33: ADO - FFO and EPRA NAV bridge
ADO - FFO and EPRA NAV bridge FFO calculation EPRA NAV calculation In €m, except per share data 1Q 2020 1Q 2019 In €m, except per share data 1Q 2020 FY 2019 EBITDA from rental activities 18 24 Total equity attributable to owners of the Company 2,569 2,647 Net cash interest -6 -7 Fair value of deriva
Slide 34: ADLER Real Estate – First quarter 2020 financials
ADLER Real Estate First quarter 2020 financials
Slide 35: ADLER – Portfolio KPI's
ADLER – Portfolio KPI’s Total number of units Investment properties (€m) Residential portfolio FV per sqm (€) 1,400 70,000 6,000 1,167 1,164 60,000 1,200 1,095 1,095 5,000 1,000 928 50,000 817 4,000 800 735 40,000 3,000 30,000 58,113 58,083 58,190 4,989 4,920 4,930 600 48,218 47,662 46,179 2,000 20,
Slide 36: ADLER - Profit and loss statement
ADLER - Profit and loss statement Profit and loss statement per 31 March 2020 Comments In €k 1Q 2020 1Q 2019 1 Gross rental income decreased by -4.6% YoY mainly due to disposal of a part 1. Gross rental income 90 1 95 of BCP’s commercial assets and 3,700 non core residential units Expenses from prop
Slide 37: ADLER - Balance sheet
ADLER - Balance sheet Balance sheet per 31 March 2020 Comments In €m 1Q 2020 FY 2019 1 Investment properties increased marginally as a result of capitalised 1. Investment properties 4,930 1 4,920 renovation and modernisation measures as well as construction costs for Other non-current assets 664 2 3
Slide 38: ADLER - FFO and EPRA NRV bridge
ADLER - FFO and EPRA NRV bridge FFO Calculation EPRA NRV1 calculation In €m, except per share data 1Q 2020 1Q2019 In €m, except per share data 1Q 2020 FY 2019 Consolidated net profit -27 15 Equity attributable to ADLER shareholders 1,405 1,446 Financial result 46 39 Deferred tax liabilities 482 517
Slide 39: Disclaimer
Disclaimer This presentation is for informational purposes only. This presentation is not intended to form the basis of any investment decision and should not be considered as a recommendation by ADO Properties S.A. and/or ADLER Real Estate Aktiengesellschaft (together, the “Companies”) or any other