Investis Holding SA · SIX:IREN

Investis Holding SA — FY2018 Earnings Presentation

39 slides from Investis Holding SA's earnings presentation, Mar 28, 2019

  1. Slide 1: Full-Year 2018 Results

    FULL-YEAR 2018 RESULTS IR-Presentation – 28 March 2019

  2. Slide 2: Disclaimer

    Disclaimer This communication contains specific forward-looking statements, beliefs or opinions, including statements with respect to objectives, which are based on current beliefs, expectations and projections about future events and assumptions of the management of Investis Holding SA ("Investis")

  3. Slide 3: Focus points Agenda

    Focus points Agenda  Highlights on Group performance and market overview  Details on Full Year 2018 performance  Outlook  Appendix IR-PRESENTATION - FULL-YEAR 2018 RESULTS - 28 MARCH 2019 3

  4. Slide 4: Investis key figures at a glance

    1994 CHF 0.8 bln CHF 1.3 bln 157 CHF 1.74 bln 0.5 % +32.8 % 59.59 Founded Market Cap Portfolio Properties Rents under Average Net profit NAV value management interest 95% rate excluding per share excl deferred revaluation Focus on effect taxes with regard Lake Geneva to properties

  5. Slide 5: Main developments 2018 – substantial increase in Net profit excluding revaluation effect

    Main developments 2018 – substantial increase in Net profit excluding revaluation effect Investis Group:  Net profit at CHF 54.4m  NAV per share excluding deferred taxes with regard to properties at CHF 59.59 (CHF 55.91)  Proposed gross dividend: CHF 2.35 / Dividend yield: 3.8% / Payout ratio: 55

  6. Slide 6: On track to achieve mid-term targets for 2019

    On track to achieve mid-term targets for 2019 announced pre IPO in June 2016  Properties: annualised rental income > CHF 50m  Real Estate Services: high single–digit EBIT margin WIP  Financing: through unsecured senior debt IR-PRESENTATION - FULL-YEAR 2018 RESULTS - 28 MARCH 2019 6

  7. Slide 7: Real Estate Market in Geneva

    Real Estate Market in Geneva Population growth in terms of immigration expected to continue but changes in way of living will require more apartments going forward 1. Half of the expected household growth in Geneva until 2040 (expected anywhere between 26‘000 and 43‘000 households depending on diffe

  8. Slide 8: Regional focus around Lake Geneva of the property portfolio is an advantage

    Regional focus around Lake Geneva of the property portfolio is an advantage Proving successful in a very regulated environment – positive net migration an asset  Limited availability and high regulatory obstacles in the residential properties sector in the area increases the barriers to VD: 23% suc

  9. Slide 9: Real Estate Market in Switzerland: Low vacancy rates in key markets

    Real Estate Market in Switzerland Low vacancy rates in Investis’ key markets Vacancy rate Vacancy rate below avg / drop in # of construction permits Vacancy rate above avg / drop in # of construction permits Vacancy rate below avg / rise in # of construction permits Vacancy rate above avg / rise in

  10. Slide 10: Real Estate Market in Switzerland: Shortage of apartments

    Real Estate Market in Switzerland Shortage of apartments in Investis’ key markets * forecast Source: Wüest Partner October 2018 IR-PRESENTATION - FULL-YEAR 2018 RESULTS - 28 MARCH 2019 10

  11. Slide 11: Real Estate Market in Switzerland: Offer of residential properties in big city centres

    Real Estate Market in Switzerland The offer of residential properties in …. the construction activity is even big city centres does not grow ….. regressive in large city centres Construction permits for rental apartments: white figures – variance to the average 2003-2018 Large city centres Agglomera

  12. Slide 12: Growing attractiveness of city centres

    Real Estate Market in Switzerland Growing attractiveness of city centres …… but not only – population in large for families ……. cities are expected to grow overall Population in ‘000 Zurich Geneva Basel Bern Lausanne urban agglomeration urban agglomeration urban agglomeration urban agglomeration urb

  13. Slide 13: Real Estate Market in Switzerland: Rent developments, higher yields in Geneva

    Real Estate Market in Switzerland Higher yields in Geneva Rent developments Index 1st Q 2008 = 100 Smaller centres Big city centres Switzerland Geneva Zurich 10y Swiss Government Bond Source: Wüest Partner IR-PRESENTATION - FULL-YEAR 2018 RESULTS - 28 MARCH 2019 13

  14. Slide 14: Case study: Buy and hold strategy, Rue du Nant – Geneva

    Case study: Buy and hold strategy Rue du Nant 30 – Geneva Acquisition in December 1998 for CHF 1.9m Renovation of Additional energy Residential block built in 1986 with bathrooms and New lifts / efficiency renovation 40 residential units and two retail units kitchens Painting of stairs works 1998 20

  15. Slide 15: Focus points Agenda

    Focus points Agenda  Highlights on Group performance and market overview  Details on Full Year 2018 performance  Outlook  Appendix IR-PRESENTATION - FULL-YEAR 2018 RESULTS - 28 MARCH 2019 15

  16. Slide 16: Investis Group: substantial growth in Net Profit excluding revaluation

    Investis Group: substantial growth in Net Profit excluding revaluation by almost one third (CHFm) FY 2015 FY 2016 FY 2017 FY 2018 ∆ to ’17 in % FY 2018 Revenues Revenue 157.4 161.9 190.0 197.5 +3.9 27% EBITDA 29.9 28.7 37.3 39.7 +6.5 before revaluations/disposals 73% Income from revaluations / from

  17. Slide 17: Properties: Target set for 2019 reached in 2018

    Properties: Target set for 2019 reached in 2018 Significant growth in rental income coupled with consummated rental increases (CHFm) FY 2015 FY 2016 FY 2017 FY 2018 Revenue from letting of  Like-for-like rental growth +1.7% (PY 1.9%) 40.8 41.9 47.5 55.0 properties  Vacancy rate at 2.9% (PY 3.5%) a

  18. Slide 18: Properties: further potential for rent increases

    Properties: Target set for 2019 reached in 2018 – further potential for rent increases (CHFm) Rent potential based on Wüest Partner appraisal 55.0 47.5 (CHFm) 41.9 40.8 +13% +4.1% 35.0 32.4 +3.4% +1.1% 27.3 +1.9% +1.7% +1.0% 25.0 Current rent Market rent 1) 40.8 6.3% 41.9 74% of rental income indexe

  19. Slide 19: Properties: Further expanding portfolio

    Properties: Further expanding portfolio -> adding value & rental growth Investment Properties: 157 properties – 2,911 residential units by category: by canton: by apartment type 1) : High quality portfolio 2) 8% 4% 1% 13% 28% 23% 28% 72% 31% 92% Residential Commercial GE VD VS other 1-room 2-room 3-

  20. Slide 20: Real Estate Services: slower development as anticipated

    Real Estate Services: slower development as anticipated Confirming the targets set for 2019 Revenue split (CHFm) FY 2015 FY 2016 FY 2017 FY 2018 Revenue 131.3 136.1 147.6 147.8 EBIT 6.2 3.9 7.8 7.7 46% 54% EBIT margin 4.7% 2.9% 5.3% 5.2%  Steady positive development in Property Management – organic

  21. Slide 21: Real Estate Services: further organic growth in both segments

    Real Estate Services: further organic growth in both segments Rise in Rents under Management to CHF 1.74bln (+CHF 60m) 147.7 147.8 (CHFm) 1% 136.1 131.3 12% Construction Management 14% 46% 46% 32% Facility Services 31% 56% 53% 54% Property Management 55% FY 2015 FY 2016 FY 2017 FY 2018  Top line or

  22. Slide 22: Real Estate Services: active nationwide with well-known local brands

    Real Estate Services: active nationwide with well-known local brands Focus on two Activities: Property Management and Facility Services Property Management Facility Services  Property management  Caretaking services  Co-ownership associations  Cleaning services  Center management  Building tec

  23. Slide 23: Considerable improvement in Net profit excluding revaluation effect

    Investis Group: Considerable improvement in Net profit excluding revaluation effect Lowering of financing costs pursued – normalised effective tax rate (CHFm) 31.12.2015 31.12.2016 31.12.2017 31.12.2018  Continuous reduction of average interest rate EBIT 60.2 76.4 60.9 74.6 – 2018: 0.5% – 2017: 0.7

  24. Slide 24: Solid Balance sheet – LTV at 41% within target range

    Solid Balance sheet prevails – LTV at 41% within target range Implementation of financial strategy completed as of Q1 2019 – no subordinated debt Balance Sheet (CHFm) 31.12.2015 31.12.2016 31.12.2017 31.12.2018 ∆ 15 vs 18 Cash and cash equivalents 48 53 51 33 -15 Properties portfolio 857 981 1,121 1

  25. Slide 25: Attractive financial profile with strong resilience

    Attractive financial profile with strong resilience supported by flexibility in leverage Evolution of the Financial debt over the last 3 years as per 31.12.2015 as per 31.12.2018 Privileged creditors 8% 1% 5% CHF 366m CHF 550m 92% Privileged creditors 94% Mortgages Bonds Other loans Mortgages Bonds

  26. Slide 26: No subordination of bondholders at Investis anymore

    No subordination of bondholders at Investis anymore Among the best in its peer group Gross leverage (Financial debt in % of Portfolio value) 60 As per 28 March 2019:  New credit facility in place 55  No security provided 50  All mortgages notes recovered – Except for two fixed term mortgage loans

  27. Slide 27: Focus points Agenda

    Focus points Agenda  Highlights on Group performance and market overview  Details on Full Year 2018 performance  Outlook  Appendix IR-PRESENTATION - FULL-YEAR 2018 RESULTS - 28 MARCH 2019 27

  28. Slide 28: Outlook: Mid-term targets 2019 confirmed

    Outlook Mid-term targets 2019 confirmed - Real Estate Services: High single digit EBIT margin Post Closing events - Successful issue of a fixed-rate bond CHF 140m with a tenor of 2 years and a coupon of 0.773% to refinance the bond expiring in February 2019 - Closing of the sale of its subsidiary Ré

  29. Slide 29: Outlook: Basic parameters influencing the real estate market 2019

    Outlook Basic parameters influencing the real estate market 2019 in the Lake Geneva region Im- /Migration Construction activity Regulations Capital Markets  Into Switzerland  Limited activity especially in GE  Tax regime for corporations  CHF interest rates expected  From other cantons into  S

  30. Slide 30: Outlook: AGM April 2019

    Outlook AGM 29 April 2019 - All Board members to stand for re-election - The two members of the Compensation Committee to stand for re-election - Distribution from statutory capital contribution reserves of CHF 2.35 per registered share or CHF 30 million recommended to shareholders - Free of withhol

  31. Slide 31: Focus points Agenda

    Focus points Agenda - Highlights on Group performance and market overview - Details on Full Year 2018 performance - Outlook - Appendix IR-PRESENTATION - FULL-YEAR 2018 RESULTS - 28 MARCH 2019 31

  32. Slide 32: Investis Group is a leading Swiss residential property company

    Investis Group is a leading Swiss residential property company in the Lake Geneva region and a national real estate services provider Strategy and investment policy Continuation of the buy-and-hold strategy through selected investments in the properties segment Preservation and increase of portfolio

  33. Slide 33: Fundamental business strengths

    Fundamental business strengths Value proposition PROPERTIES REAL ESTATE SERVICES Pure Swiss player Stable financing and financial flexibility to take advantage of market opportunities Established position with high barriers to entry and differentiated success factors Highly entrepreneurial managemen

  34. Slide 34: IPO Commitments

    IPO Commitments ………. ………. done back in June 2016 1. Investments into Portfolio and achieve rental income of > CHF 50m by 2019 2. Strengthening Real Estate Services and achieve high single digit EBIT margin by 2019 WIP 3. Debt restructuring by 2019 no subordination of bond holders 4. Buyout minority

  35. Slide 35: Main achievements since IPO

    Main achievements since IPO  Development of the property portfolio – Portfolio value up 54% since IPO to CHF 1.3 bln – CHF 451m invested since 30.6.2016 – Annualised full occupancy property rent increased to CHF 57.7m from CHF 41.8m (June 2016) – Revaluation gains: 2016: CHF 47m / 2017: CHF 25m / F

  36. Slide 36: Entrepreneurial business since 1994

    Investis Group has been an entrepreneurial business since 1994 Celebrating 25th anniversary in 2019 1994 Foundation  Foundation of «Compagnie Foncière de la Cité» with own funds 1994 – Investment and formation of a large  Accumulation of residential properties in the Lake Geneva region mainly 2005

  37. Slide 37: Executive Board and Board of Directors

    Highly entrepreneurial and experience management in place Riccardo Boscardin Stéphane Bonvin Chairman Independent member CEO Investis Group Member of the Audit and Compensation Head of Properties Committee Albert Baehny René Häsler Vice-Chairman BOARD OF DIRECTORS CFO Investis Group Independent memb

  38. Slide 38: Organisation

    Organisation IR-PRESENTATION - FULL-YEAR 2018 RESULTS - 28 MARCH 2019 38

  39. Slide 39: Thank you for your attention!

    Thank you for your attention! IR-PRESENTATION - FULL-YEAR 2018 RESULTS - 28 MARCH 2019 39

Investis Holding — FY2018 Earnings Presentation on 6ix