KWG reports good operating performance along with significant increase in earnings

  • Net cold rents of around €22.9 mn
  • FFO up from €4.6 mn to €5.7 mn

Berlin, 13 November 2014 - KWG Kommunale Wohnen AG (KWG) is a German property company focusing on developing and marketing residential property. Today the company, in which Austrian majority stakeholder conwert Immobilien Invest SE holds around 79%, announced the figures for the first nine months of 2014.

In the reporting period revenue rose by almost 5% to €45.4 mn (1-9/2013: €42.9 mn). Rental income accounted for the largest share of revenue, although at €33.2 mn it was somewhat lower than the previous year due to the sale of properties (1 9/2013: €33.6 mn). Consequently, net cold rents also slipped back from €23.2 mn to €22.9 mn. Overall, 486 units and 167 parking spaces were sold in the first three quarters of 2014, representing sales income of €12.1 mn (1 9/2013: €8.3 mn). The sales margin was 15.1%.

These profitable sales allowed KWG to successfully continue its strategic portfolio streamlining, initiated in 2013. Surplus liquidity from property sales will be reinvested in developing the hold portfolio in order to increase the quality of property held. KWG will continue to implement its strategy of portfolio streamlining in the fourth quarter of 2014 and selectively dispose of properties which are not an ideal fit for the corporate profile in light of structural or regional aspects. Successful property sales caused the number of rental units to fall to 8,846 residential and commercial units (30/09/2013: 9,416), representing a reduction in usable space of around 36,000 sqm or 6%. As of 30 September 2014 the vacancy rate of the KWG portfolio improved by 10.4% to 12.9% (30/09/2013: 14.4%). At the same time, average portfolio rents rose slightly from €5.00/sqm/m to €5.10/sqm/m.

For the first three quarters of 2014 KWG reported FFO excluding sales of €5.7 mn (1 9/2013: €4.6 mn). This represents yoy growth of around 24% and is already above the forecasts for the full year 2014 of around €5 mn. Consolidated profit fell by around 63% to €4.3 mn (1-9/2013: €11.7 mn), primarily due to positive fair value adjustments of €8.9 mn caused by acquisitions of KWG in the same period 2013. In the first three quarters of 2014 KWG recorded fair value gains on properties of €0.4 mn.

N.B.: KWG group reporting was adjusted in the current business year to conform to that of the conwert group by means of reporting amendments to the income statement, balance sheet, statement of changes in equity and cash flow statement, along with other key performance indicators. Comparative figures were also amended. As a result, comparison with the data published by the KWG group as of the third quarter 2013 is only possible to a limited extent.

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