DIC Asset AG well-positioned and stable – net take-up increased by 31%
- Assets under management climb to EUR 14.5 billion (+27%)
- Sustained high letting result of over 296,300 sqm (+31%)
- Like-for-like rental income growth of 3.9% in Commercial Portfolio
- FFO growth expected
Frankfurt am Main, 9 November 2022. DIC Asset AG (“DIC”), ISIN: DE000A1X3XX4, one of Germany’s leading listed property companies, published its financials for the first nine months of the year today. In a globally turbulent environment, DIC remained successfully on course. The company was able to increase the value of its assets under management by 27% and the net take-up by 31%. By year-end, DIC expects to see EUR 114 to 117 million in FFO, which would imply a year-on-year increase by 7-10%.
“Our business model has proven stable and robust. This is where our forward-looking management pays off, which prepared early on for the challenges we are now seeing. Based on the fast growth of our attractive proprietary portfolio with its focus on office and logistics real estate, we are generating a steady cash flow, create reliable values for our stakeholders, and expect this to be another year with FFO growth,” said Sonja Wärntges, CEO of DIC Asset AG
Due to its high share of recurring cash flows from rents and management fees, DIC managed to earn EUR 76.1 million (previous year: EUR 79.6 million) in funds from operations (FFO) by the end of the first nine months of this year in spite of the current slowdown of the transaction business. When adjusted for the one-off expenses of the majority acquisition of VIB Vermögen AG, the consolidated net income adds up to EUR 44.8 million (previous year: EUR 51.2 million).
Results and milestones of the first nine months of 2022:
- Compared to prior-year period, the company’s assets under management increased by a significant 27% to EUR 14.5 billion. The transaction volume incl. the acquisition of VIB equalled c. EUR 2.7 billion.
- The balance sheet portfolio with its focus on logistics and office real estate (Commercial Portfolio without warehousing) currently has a market value of c. EUR 4.5 billion and is optimally diversified by region and tenant industry. The gross rental yield equalled 4.7% as at balance sheet date, while the EPRA vacancy rate was 4.3%, and the average remaining lease term (WALT) 5.5 years.
- Compared to the prior-year period, both the gross and the net rental income are strongly defined by the VIB transaction and consolidation since the second quarter of 2022 as well as by the persistently high net take-up. The gross rental income increased significantly over prior-year period as it rose to EUR 124.9 million (previous year: EUR 78.0 million). Another factor that contributed to the increase is the high net take-up and the associated like-for-like rental income growth by 3.9% in the balance sheet portfolio (Commercial Portfolio). The net rental income went up to EUR 108.8 million (previous year: EUR 65.3 million).
- Real estate management fees are defined by the slowed transaction activity in the course of the year and by a decrease in development fees: Overall, the company earned c. EUR 56.9 million in real estate management fees. The sum total breaks down into EUR 30.0 million (previous year: EUR 47.1 million) in transaction and performance fees, and EUR 26.9 million (previous year: EUR 27.5 million) in asset management, property management and development fees.
- The share of the profit or loss of associates climbed to EUR 18.0 million (previous year: EUR 5.1 million), especially due to the successful disposal of a joint-venture participation by VIB and the appreciation of two logistics properties in North Rhine-Westphalia that was thereby realised.
- Adding up to EUR 61.9 million, the operating costs exceeded the prior-year total due to the one-off effects associated with the VIB transaction (in the amount of EUR 10.6 million) and the set-up of strategic resources in connection with the growth of our real estate management platform (9M 2021: EUR 44.1 million).
- The net interest income dropped to EUR -41.6 million (9M 2021: EUR -23.6 million), primarily due to the first-time recognition of the VIB debt, the funding activities during the previous year, and the VIB bridge loan. The average interest expenses as of 30 September 2022 equalled 2.0% (31 December 2021: 1.8%).
- As of 30 September 2022, the NAV amounted to EUR 18.54 per share (31 December 2021: EUR 18.44). The Adjusted NAV, supplemented by the economic value-added of the Institutional Business, equalled EUR 24.99 per share (31 December 2021: EUR 25.00).
- The loan-to-value ratio (loan to value, LTV) increased to 56.9% since the end of 2021 (31 December 2021: 48.5%), primarily as a result of having to finance the acquisition of the controlling majority in VIB. Analogously, the Adjusted LTV, which takes the value of the Institutional Business into account, rose to 51.6% (31 December 2021: 41.1%).
Annual forecast for 2022 adjusted – FFO growth by 7% to 10% year-on-year
On 2 November 2022, DIC adjusted its forecast for the ongoing financial year of 2022, and now expects its funds from operations (FFO) (before tax, after non-controlling interests) to equal EUR 114 to 117 million (previously: EUR 130 to 136 million) and real estate management fees to equal EUR 90 to 95 million (previously: EUR 105 to 115 million). The reason for the adjustment are the changed parameters on the real estate investment market, which have caused some of the planned acquisitions and disposals to be delayed and rescheduled. In the case of DIC, this concerns the Institutional Business (third-party business on behalf of institutional investors) whose revenues and earnings from management fees depend more strongly on the transactions market than the Commercial Portfolio (real estate held in the proprietary portfolio) whose revenues are essentially generated by rent payments. Following the consolidation of VIB and given the persistently strong volume of lettings and lease renewals, DIC anticipates a gross rental income in the amount of EUR 170 to 180 million, which implies a considerable increase compared to the year-end total of 2021. With VIB taken into account, the plans call for acquisitions in an amount of EUR 2,950 to 3,000 million across segments: Thereof, proprietary portfolio (Commercial Portfolio) accounts for acquisitions in the amount of c. EUR 2.3 billion, and the Institutional Business for acquisitions worth EUR 650 to 700 million. The acquisition target for the Commercial Portfolio has already been achieved due to the acquisition of the majority interest in VIB. In addition, disposals of EUR 400 to 500 from the Commercial Portfolio are planned. No further disposals are planned for the Institutional Business during the 2022 financial year.
Invitation to attend conference call on 9 November 2022
The Management Board of DIC Asset AG invites you to attend the presentation of the financial statement for the first nine months of 2022 on 9 November 2022 at 10:00 CET.
Please use the link below to register for the conference call:
The webcast (incl. replay) is available under the link below:
For more details on DIC Asset AG, visit the company’s homepage at www.dic-asset.de.
About DIC Asset AG:
DIC Asset AG is Germany’s leading listed specialist for office and logistics real estate with more than 20 years of experience on the real estate market and access to a broad-based network of investors. Our business is based on a regional and inter-regional real estate platform with nine offices on the ground in all major German markets (with VIB Vermögen AG included). We currently manage a total of 359 assets with a combined market value of EUR 14.5 billion on site, always close to our properties and their occupiers.
The Commercial Portfolio segment comprises real estate held for our own account. Here, we generate steady cash flows from stable rent revenues on long-term leases while also optimising the value of our portfolio assets through active management, and realising gains from sales.
In the Institutional Business segment, we earn recurrent fees from real estate services we provide to national and international institutional investors by structuring and managing investment products that return attractive dividend yields.
DIC Asset AG has been SDAX-listed since June 2006.
IR Contact DIC Asset AG:
Head of Investor Relations & Corporate Communications
Neue Mainzer Strasse 20
D-60311 Frankfurt am Main
Phone +49 69 9454858-1492
DIC Asset AG at a Glance
Key financial figures in EUR million
|Gross rental income
|Net rental income
|Real estate management fees
|Proceeds from sales of property
|Profits on property disposals
|Share of the profit or loss of associates
|Funds from operations, excl. non-controlling interest (FFO)
|Funds from operations II (excl. non-controlling interest, incl. profit on disposals)
|Adjusted profit for the period
|Profit for the period
|Cash flow from operating activities
|Key financial figures per share, in EUR*
|FFO per share excl. non-controlling interest
|FFO II (incl. profits from disposals) excl. non-controlling interest
|Adjusted earnings per share excl. non-controlling interest
|Earnings per share excl. non-controlling interest
|Balance sheet figures, in EUR million
|Loan-to-value (LtV), in %**
|Financial liabilities (incl. IFRS 5)
|Cash and cash equivalents
|NAV (per share, in EUR)
|Adjusted NAV (per share, in EUR)***
|Operating performance indicators (entire platform)
|Number of properties
|Assets under management, in EUR billion
|Rental space, in sqm
|Letting result, in sqm
|Operating performance indicators
(balance sheet portfolio)****
|Annualised rental income, in EUR million
|EPRA vacancy rate, in %
|WALT, in years
|Average rent per sqm, in EUR
|Gross rental yield, in %
* Per-share figures adjusted in accordance with IFRS (number of shares 9M 2022: 82,533k | 9M 2021: 81,834k)
** Warehoused assets not included
*** Incl. full value of the Institutional Business
**** Commercial Portfolio without properties to be repositioned and warehoused assets
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