Q3 2024 Adler Group SA Earnings Call Transcript
Key Points
- Adler Group SA (ADPPF) successfully disposed of a 62.8% stake in Brack Capital Properties, generating approximately EUR219 million in net cash proceeds, which is ahead of their business plan.
- The company reported a strong like-for-like rental growth of 4.1% year-on-year, driven by indexation of current rental contracts and reletting activities.
- Operational vacancy rate remained low at 1.7%, indicating high demand for their rental properties.
- The group's total equity was significantly strengthened to approximately EUR2.2 billion following a comprehensive recapitalization.
- Adler Group SA (ADPPF) extended all bank maturities due in 2024, leaving no outstanding maturities for the year, and is securing approvals for extending 2025 and 2026 loans.
- Net rental income decreased by 3% to EUR155 million in the first nine months of 2024, primarily due to past portfolio sales.
- FFO 1 from rental activities was negative at minus EUR88 million, driven by a substantial increase in interest expenses.
- The weighted average cost of debt increased to 7.9% from 6.4% in the previous quarter, reflecting higher interest rates on new debt.
- Despite the recapitalization, the company remains highly leveraged with an LTV of 62.6%, which is high compared to industry peers.
- The financial performance was impacted by EUR147 million of non-cash effective PIK interest in the first nine months of 2024.
Good morning, everyone, and thank you for joining us here today for the Adler Group Q3 2024 investor call. As you may have seen, besides our results, we have also announced changes to our senior management team, which we published in a separate press release last night.
Along with me, we have our new CFO, Thorsten Arsan, who will guide us through today's presentation. This presentation will be followed by a Q&A session in which we will answer your questions. Please note that this call will be recorded and made available on the company's website, where you can also find today's presentation.
With that, I would like to hand over to Thorsten.
Thank you, Julian. Also a warm welcome to everyone from my side, and thanks for joining us here today. As you know, we have announced a major disposal since our last investor call in September. So let us start with the disposal update on page 4.
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