Half Year 2024 Demire Deutsche Mittelstand Real Estate AG Earnings Call Transcript
Key Points
- DEMIRE Deutsche Mittelstand Real Estate AG successfully refinanced its EUR499 million bond, extending maturity to December 2027, providing more than three years for balance sheet refinancing.
- The company achieved substantial shareholder support, including a EUR100 million shareholder loan for bond buybacks.
- DEMIRE Deutsche Mittelstand Real Estate AG managed to sell properties worth EUR176 million in 2023, contributing to liquidity and operational stability.
- The company's net Loan-to-Value (LTV) ratio decreased from 57.7% in 2023 to 55.6% in June 2024, with expectations to fall further to about 50% after bond extension.
- Despite a challenging market environment, DEMIRE Deutsche Mittelstand Real Estate AG maintained a stable Weighted Average Lease Term (WALT) of 4.3 years, indicating a solid lease structure.
- Rental income decreased by 13% in the first half of 2024 compared to the previous year, driven by asset disposals.
- The company's Funds From Operations (FFO) I dropped to EUR15.5 million in the first half of 2024, significantly lower than the previous year.
- DEMIRE Deutsche Mittelstand Real Estate AG's vacancy rate increased to 15.5% due to tenant move-outs, impacting rental income.
- The company reported a revaluation loss of EUR180 million in 2023, reflecting a challenging real estate market.
- The average cost of debt is expected to rise to approximately 3.5% after the bond extension, increasing financial expenses.
Ladies and gentlemen, good afternoon, everybody from our side as well, and welcome to our results presentation. My name is Frank Nickel, I'm the CEO of Demire. With me here is Tim Brueckner, our CFO; Ralf Bongers, our CIO; and Julius Stinauer, our our Head of Investor Relations.
I'm sure you had a chance to look at our results, although we presented a lot of results today. Our results operationally solid and show a rental income and an FFO I for 2023, in line with our expectations. As you probably are aware, we have focused strongly during 2023 and 2024 on the refinancing of our bonds.
Since summer of 2022, we have created extra liquidity for the refinancing and considering the difficult market environment for property transactions, we have succeeded in doing this well. In 2023, for example, we sold properties for around EUR176 million.
The ones of you that have been deeper into our figures may notice that one of these transactions closed in 2024. And I wanted to say
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