CONSUS Real Estate AG substantially increases overall performance in first half of 2018 and grows development portfolio
CONSUS substantially increases overall performance in first half of 2018 and grows development portfolio
– Overall performance of EUR 242.4m in H1 2018 with EUR 151.5m in Q2 18 alone driven by substantial increase in development activities
– Adj. EBIT pre-PPA of EUR 56.0m translates into a margin of 23%
– Building permits and increased percentage of construction completion for projects in Cologne, Leipzig and Dresden resulted in significant development income
– Development portfolio grown significantly to gross development volume (GDV) of EUR 6.2bn as of September 2018 (+37% vs. FY 2017), following acquisitions of EUR 1.7bn
– Successful disposal of commercial assets for EUR 148m resulted in cash inflow of EUR 68m
– Net debt of EUR 1.25bn as of H1 2018 with further pro-forma deleveraging measures since reporting date including the disposal of the stake in GxP Commercial Properties AG (‘GxP’)
– Strategic measures implemented to transform CONSUS in to a pure play residential-focussed developer and to further consolidate CG Gruppe AG (‘CG’) into CONSUS through the increase of ownership to 75%
Berlin, 10 October 2018 – Consus Real Estate AG (‘CONSUS’, ISIN DE000A2DA414) publishes its consolidated interim financial statements for H1 2018. Germany’s largest property developer in terms of gross development volume (GDV) significantly increased overall performance in the first six months of 2018. The substantial revenue from property development was primarily achieved through CONSUS’ strategy of forward selling of large development projects, such as CG’s multi-storey developments ‘VauVau’ to an institutional investor at the end of 2017, with cash received from prepayments totalling EUR 244m in H1 2018. In addition, CONSUS has achieved major strategic milestones in focussing the company solely on the real estate development segment through increasing its stake in CG to 75% on a fully diluted basis, divesting the commercial buy-to-hold portfolio as well as the GxP stake and establishing the extended management board after the reporting date.
Significant higher overall performance due to strong development activities
In the first six months of 2018, CONSUS achieved building permits for large-scale projects in Cologne, Leipzig and Dresden contributing to the overall performance in H1 2018. As part of focussing the business on real estate development, the company has divested its commercial real estate holdings over the past months. The portfolio of eight assets, which the company directly owned, was sold to an institutional investor for EUR 148m with an initial cash inflow of EUR 68m. After the reporting date, the approx. 58% stake in GxP was sold for an undisclosed amount above book value.
Due to portfolio transactions, transition to IFRS, and first time consolidation, other operating costs were EUR 33.4m of which EUR 5m were classified as one-off expenses. The management expects such costs to be reduced once the business reorganisation is completed by the end of 2018.
Continuous deleveraging in focus
CONSUS total Group debt significantly decreased from EUR 1,590m as at FY 2017 to EUR 1,283m as of H1 2018. With further deleveraging measures to impact overall indebtedness, CONSUS net debt on a pro-forma basis is approx. EUR 1,087m following the completion of the capital increase and the disposal of the GxP stake. Further operational cash gains have been recycled into the recent acquisitions of new development projects and are part of CONSUS’ growth strategy.
Total equity including minorities of the CONSUS Group increased at EUR 830m as of H1 2018 versus EUR 816m as of FY 17.
Strong development pipeline and strategic acquisitions across Germany’s top economic cities
Overall, the development portfolio now stands at EUR 6.2bn (+37% vs. FY 2017) and is split into 53 projects across Germany’s top nine cities. The constructible net floor area amounts to approx. 1.6 million sqm.
In 2018, CONSUS, through its subsidiary CG, has secured thirteen new projects for a total GDV of approx. EUR 1.7bn. With the secured development projects, CONSUS plans to develop 402,500 sqm. The projects are located in Germany’s top economic locations such as Hamburg, Cologne, Stuttgart and Leipzig.
CONSUS recently acquired several attractive development projects after the reporting date as well as a property developer with a portfolio of approx. EUR 450m and a net floor area of approx. 130,000 sqm in the Stuttgart region. The recent acquisition of a residential tower in Stuttgart Fellbach with GDV of approx. EUR 115m and a net floor area of 14,000 sqm, completes CONSUS successful acquisition execution for the first nine months of 2018.
GDV growth, stake increase in CG Gruppe AG and commercial divestments confirm 2018 guidance
CONSUS has achieved key targets for 2018, with substantial GDV growth delivered of EUR 1.7bn, the stake increase in CG Gruppe AG to 75% on a diluted basis and the commercial buy-and-hold assets divested.
CONSUS is on track to reach financial KPI targets in 2020 of an EBIT pre-PPA of approx. EUR 300m, an EBIT pre-PPA margin of approx. 20% and a Net Debt / EBIT pre-PPA of less than 3x.
Andreas Steyer, CEO of CONSUS, concludes: “We have seen significant development activities in the first six months, consolidated the development business further into CONSUS and transitioned to a focussed real estate property developer. With the recent acquisitions as well as additional strategic steps implemented, we are now fully on track to deliver our strong growth programme.”
The consolidated group management report and H1 2018 results as well as a detailed earnings presentation are available for download under: https://www.consus.ag/EN/investors/financial_reports#slide2
Invitation to the conference call on October 10, 2018
The Management Board of CONSUS Real Estate AG, CEO Andreas Steyer and CFO Benjamin Lee, will present the H1 results during a conference call at 10:00 am (CET).
Dial-ins for registered participants (registry via: https://webcast.meetyoo.de/index.html?e=b1Limsegj6gN)
DE: +49 30 232531508
UK: +44 20 3872 0883
US: +1 516-269-8979
CONSUS Real Estate AG
Corporate Finance & Investor Relations
About CONSUS Real Estate AG
CONSUS Real Estate AG (“CONSUS”), based in Berlin, Germany, with its subsidiary CG Gruppe AG, is a leading developer of residential real estate properties in the country’s Top 9 cities. With a gross development value of EUR 6.2bn CONSUS focuses on the construction of standardised apartment blocks. CONSUS acts along the entire development value chain with institutional forward sales, digitalisation of construction processes and industrial mass production. The shares of CONSUS are listed in the Scale Segment of Deutsche Börse AG and in the m:access segment of the open market (Freiverkehr) of the Munich Stock Exchange (Börse München), and are traded via XETRA in Frankfurt.