DEMIRE achieves letting record and increases FFO I in 9M 2022

• Letting record of almost 195,000 m² achieved in the nine months period
• EPRA vacancy rate falls to 9.4 percent – WALT rises to an all-time high of 5.0 years
• Net rental income develops as expected at EUR 47.7 million
• Funds from Operations I (after taxes, before minorities) grow slightly to EUR 30.8 million
• Guidance for 2022 confirmed

Langen, 17 November 2022. Despite challenging macroeconomic and geopolitical conditions, DEMIRE Deutsche Mittelstand Real Estate AG (ISIN: DE000A0XFSF0) has once again demonstrated the resilience of its business model. The company recorded a record letting performance of 194,840 m² for a nine-month period. As a result, the overall portfolio EPRA vacancy rate declined to 9.4 percent at the end of Q3 2022 (YE 2021: 11.0 percent) while the WALT reached a historic high of 5.0 years. Thanks to successful major lettings such as in the "LogPark" Leipzig and the indexation of existing leases, the like-for-like growth in annualised rental income increased by 4.9 percent.

Rental income in line with expectations, increase in FFO I

The Group's key performance indicators for the first nine months of 2022 were also in line with the Executive Board's forecast and in some cases even above the level of the prior-year period. After strategic disposals in the previous year, DEMIRE's rental income amounted to EUR 59.9 million (9M 2021: 62.3 million). Rental income developed in line with this and amounted to EUR 47.7 million (9M 2021: EUR 51.8 million).

Funds from Operations I (after tax, before minorities) grew by 1.4 percent to EUR 30.8 million in the reporting period, compared to EUR 30.4 million in the prior-year period. Following a dividend payout at the end of 2021, net asset value (NAV) per share (undiluted) was EUR 5.87 after EUR 5.96 at the end of 2021.

Convenient cash position

The average nominal interest rate on financial liabilities remains unchanged at an attractive level of 1.67 percent p.a. The loan-to-value ratio (Net-LTV) following the dividend payment is 51.2 percent (-20 base points compared to the third quarter of last year), while cash and cash equivalents as of the end of September 2022 remain comfortable at EUR 95.6 million.

Ingo Hartlief, CEO of DEMIRE, says: "The economic uncertainty in Germany is here to stay. Nevertheless, DEMIRE is in a robust and stable condition. Our high letting performance continues to improve our cash flow expectation. This proves that our proven REALize Potential strategy is working well."

2022 guidance confirmed

The Executive Board assesses the overall economic situation as challenging up to the year’s end and beyond. Neither a peaceful solution to the war over Ukraine nor a significant weakening of inflation is expected. As a result, uncertainty on the transaction markets for real estate remains high, not least due to the upward trend in interest rates. Nevertheless, against the backdrop of the positive financial year 2022 so far, the Executive Board confirms its full-year forecast: rental income is expected to be between EUR 78.0 and 80.0 million (2021: EUR 82.3 million) and FFO I (after tax, before minorities) between EUR 38.5 and 40.5 million (2021: EUR 39.8 million).

***

The complete interim report for the first nine month of 2022 is available at: https://www.demire.ag/publications/

End of press release

Invitation to Conference Call on 17 November 2022

The Executive Board of DEMIRE is pleased to invite all interested parties to participate in a conference call on Thursday, 17 November 2022, starting at 10:00 a.m. (CET) during which the financial results for the first nine month of 2022 will be presented.

Please use one of the following registration link:

https://event.loopup.com/SelfRegistration/registration.aspx?booking=Xzy8PRD1P7Yl2NRXexoSFsjV28cPNymLNpsymRdYujc=&b=2389e96d-457b-46a8-bebb-fec356d5b031

The presentation of the financial results will also be webcast live via the following link: https://www.webcast-eqs.com/demire20220825/no-audio

To listen to the audio, please use the registration link provided above. The financial results presentation will also be available for download at https://www.demire.ag/en/publications/

 

Key financial performance indicators DEMIRE Deutsche Mittelstand Real Estate AG

Consolidated income statement (in EUR million)	01/01/2022- 30/09/2022		01/01/2021- 30/09/2021
Rental income	59.9		62.3
Net income from rental of real estate	47.7		51.8
EBIT	41.2		42.6
Net financial income (loss)	-12.9		-15.2
Period net income (after taxes)	21.9		24.6
- of which attributable to shareholders of parent company	20.2		22.7
FFO I (after taxes, before minority interests)	30.8		30.4
Undiluted/diluted earnings per share (in EUR)	0.29/0.29		0.29/0.29
Consolidated balance sheet (in EUR million)	30/09/2022		31/12/2021
Total assets		1,694.9	1,705.6
Investment properties		1,453.0	1,433.1
Cash and cash equivalents		95.6	139.6
Properties held for sale		3.5	0
Equity capital (incl. non-controlling shareholders)		580.4	592.4
Equity ratio (as % of total assets)		34.2	34.7
Undiluted/diluted NAV		619.3/619.8	629.0/629.5
EPRA-NAV per share (in EUR, basic/diluted)		5.87/5.85	5.96/5.94
Net financial liabilities		816.1	775.4
Net debt-to-equity ratio (net LTV), in %		51.2	49.7
Key portfolio metrics		30/09/2022	31/12/2021
Number of properties		64	64
Total market value (in EUR million)		1,412.5	1,412.5
Annualised gross rental income (in EUR million)		83.8	78.1
Rental yield (in %)		5.9	5.5
EPRA vacancy rate (in %)*		9.4	11.0
WALT (in years)		5.0	4.7
*excluding properties held for sale or classified as project developments

About DEMIRE Deutsche Mittelstand Real Estate AG

DEMIRE – REALize Potential

DEMIRE Deutsche Mittelstand Real Estate AG acquires and holds commercial real estate in mid-sized cities and up-and-coming locations bordering metropolitan areas across German. The Company's particular strength lies in realising the potential of the properties at these locations while focusing on a range of properties that appeals to both regional and international tenants. As of 30 September 2022, DEMIRE's portfolio contains of 64 assets with lettable space totalling about 1 million sqm. Including the proportionately acquired Cielo property in Frankfurt/Main, the market value amounts to so approximately EUR 1.7 billion.

The portfolio's focus on office properties with a blend of retail, hotel and logistics properties results in a return / risk structure that is appropriate for the commercial real estate segment. The Company places importance on long-term contracts with solvent tenants and the realisation of the properties' potential. DEMIRE anticipates continued stable and sustainable rental income along with solid value appreciation.

DEMIRE Deutsche Mittelstand Real Estate AG shares are listed in the Regulated Market (Prime Standard segment) of the Frankfurt Stock Exchange.”

Contact:
Julius Stinauer
Head of Investor Relations & Corporate Finance
DEMIRE Deutsche Mittelstand Real Estate AG
Telefon: +49 6103 372 4944
Email: [email protected]