Home Invest Belgium : Results of the 1st quarter of 2024

22/05/2024 5:40 PM

Regulated information

• • Qualitative residential real estate portfolio
• Increase in the fair value of the real estate portfolio to € 837,31 million at 31 March 2024.
• The investment properties available for rent consist for 91,0% of residential real estate.
• More than 50% of the investment properties available for rent are younger than 10 years; more than 80% are younger than 20 years.
• Completion of the Den Dam residential project in Antwerp with 37 units with contemporary and sustainable design.
• • Strong rental market results in high occupancy rate
• Strong residential rental market with strong demand for quality housing.
• An average occupancy rate of 98.4% in the first three months of 2024.
• Lfl (like-for-like) rental growth of 3.5% in the first three months of 2024.
• • Continued growth in the EPRA earnings
• 11.9% increase in the EPRA earnings to € 3.47 million during the first three months of 2024 (compared to € 3.10 million during the first three months of 2023).
• 1.5% increase in the EPRA earnings per share to € 0.18 in the first three months of 2024 (compared to € 0.17 in the first three months of 2023).
• • Sale transactions announced for a total net sales price of € 40.6 million
• Sale transactions announced for a total net sale price of € 40.6 million. The net sale price of these sale transactions is 25.0% above the last valued fair value (31 December 2023).
• • Increase in Net Asset Value per share (NAV)
• Increase in EPRA NTA per share by 14.2% to € 23.24 in the first three months of 2024 (compared to € 20.36 at 31 December 2023).
• • Stable debt ratio and strong liquidity position
• Debt ratio of 47.13% (RREC Royal Decree) and 46.00% (IFRS) at 31 March 2024.
• The average cost of debt amounts to 2.10% in the first three months of 2024.
• 91.7% of financial debts have a fixed interest rate with a weighted average remaining maturity of 5.1 years.
• Home Invest Belgium has € 68.00 million available credit lines.
• The company does not have credit lines or bonds maturing in 2024 or the first half of 2025. The first coming maturity dates fall in the second half of 2025. The ongoing development pipeline is fully funded.
• • Outlook 2024 and distribution to shareholders
• For 2024, Home Invest Belgium expects an increase of the EPRA earning per share to € 1.15 (compared to € 1.13 in 2023) despite the issue of 10.0% new shares in July 2023 (ABB 2023).
• The General Meeting and Extraordinary General Meeting of shareholders of 7 May 2024 has approved a total distribution of € 1.12 per share (compared to € 1.10 for 2022), which implies an increase for the 24th consecutive year.
  The distribution consists of the combination of:

1	RESULTS OF THE 1ST QUARTER 2024

1. a gross dividend of € 1.01 per share (an increase of € 0.01 compared to € 1.00 for 2022);

• 1. a reduction in equity of € 0.11 per share (an increase of € 0.01 compared to € 0.10 for 2022).
• For the coming years, the Board of Directors foresees a pay-out policy based on an average increase equal to or higher than the long-term inflation.

2	RESULTS OF THE 1ST QUARTER 2024

1. Real estate portfolio………………………………………………………………………………………………………………………………………………. p.4
2. Consolidated key figures…………………………………………………………………………………………………………………………………….. p.5

3. Notes to the consolidated key figures…………………………………………………………………………………………………………	p.7
3.1.	Notes to the consolidated income statement……………………………………..…………………………………	p.7

1. 1. Notes to the consolidated balance sheet………………………………………….…………………………………….. p.8
   2. Funding structure…………………………...…………………………………………….……………………………………………………….. p.9
2. Activities in the first three months of 2024……………………………………………………………………………………………. p.11
3. 1. Rental activities…………………………………………………………………………..…………………………………………………………… p.11
   2. Renovation and Development projects…....………………………………………………………………………………. p.11
   3. Sales …………..…………………………………………………………………………………………………………………………………………………. p.12
4. Distribution to the shareholders…………………………………………………………………………………………………………………….. p.13
5. Outlook………………………………………………………………………………………………………………………………………………………………………… p.14

7. APM - Alternative Performance Measures………………………………………………………………………………………………… p.15

8. Shareholder's calendar…………………………………………………………………………..……………………………………………………………. p.19

3	RESULTS OF THE 1ST QUARTER 2024

At 31 March 2024, Home Invest Belgium holds a real estate portfolio1 of € 837.31 million, compared to € 780.93 million at 31 December 2023).

REAL ESTATE PORTFOLIO	31/03/2024	31/12/2023
Fair value of investment properties	€ 811.33 m	€ 755.46 m
Investment properties available for rent	€ 761.02 m	€ 704.89 m
Development projects	€ 50.31 m	€ 50.57 m
Investments in associated companies and joint ventures	€ 25.99 m	€ 25.47 m
TOTAL	€ 837.31 m	€ 780.93 m

The fair value of the investment properties available for rent amounts to € 761.02 million across 46 sites.

The total contractual annual rents and the estimated rental value of vacant space is € 37.64 million as at 31 March 2024.

The investment properties available for rent are valued by independent real estate experts at an average gross rental yield2 of 4.9%.

Residential properties accounted for 91.0% of investment properties available for rent at 31 March 2024.

66.9% of the investment properties available for rent are located in the Brussels Capital Region, 9.9% in the Walloon Region, 14.4% in the Flemish Region and 8.7% in the Netherlands.

Investment properties available for rent by type

Retail

Offices

6,1% Residential

3,0%

	0,5%
91,0%	83,8
	%
	6,7%

Nursing homes

Houses

Tourism

Investment properties available for rent by geographical distribution

The

Nethelands

8,7%

Flemish

Region

14,4%

Walloon
Brussels
Region
9,9%		Capital
		Region
		66,9%

1. The real estate portfolio consists of (i) investment properties and (ii) investments in associated companies and joint ventures equity method.
2. Gross rental yield = (contractual gross rents on a yearly basis + estimated rental value on vacant spaces) / (fair value of the investment properties available for rent).

4	RESULTS OF THE 1ST QUARTER 2024

CONSOLIDATED KEY FIGURES		(in k €)
INCOME STATEMENT	31/03/2024	31/03/2023
NET RENTAL INCOME	9 002	8 531
OPERATING RESULT BEFORE PORTFOLIO RESULT	4 612	4 081
OPERATING MARGIN3	51.2%	47.8%
XVI. Result on the sale of investment properties	2 138	28
XVIII. Changes in fair value of investment properties	50 775	-10 103
XIX. Other portfolio result	-69	338
PORTFOLIO RESULT	52 843	-9 738
OPERATING RESULT	57 455	-5 657
XX. Financial income	2	26
XXI. Net interest charges	-1 428	-1 270
XXII. Other financial charges	-23	-41
XXIII. Changes in fair value of financial assets and liabilities	883	-2 408
FINANCIAL RESULT	-567	-3 693
XXIV. Share in the profit of associated companies and joint ventures	520	560
TAXES	-93	-86
NET RESULT	57 316	-8 876
Exclusion of portfolio result	-52 843	+9 738
Exclusion of changes in fair value of financial assets and liabilities	-883	+2 408
Exclusion of non-EPRA elements of the share in the result of associated companies and joint ventures	-118	-169
EPRA EARNINGS4	3 471	3 101
Average number of shares5	19 615 078	17 785 785
NET RESULT PER SHARE (in €)	2.92	-0.50
EPRA EARNINGS PER SHARE (in €)	0.18	0.17

1. Operating margin = (operating result before portfolio result) / (net rental income)
2. EPRA earnings is the net result excluding the (i) portfolio result (ii) the changes in the fair value of financial assets and liabilities and (iii) the non-EPRA elements of the share in the result of associated companies and joint ventures. This term is used in accordance with the Best Practices Recommendations of EPRA.
3. The average number of shares is calculated excluding the own shares held by the company.

5	RESULTS OF THE 1ST QUARTER 2024

BALANCE	31/03/2024	31/12/2023
Shareholders' equity (attributable to shareholders of parent company)	475 184	417 761
Total assets	873 004	807 808
Debt ratio (RREC Royal Decree)6	47.13%	50.51%
Debt ratio (IFRS)7	46.00%	48.83%

PER SHARE	31/03/2024	31/12/2023
Number of shares at end of period8		19 615 078	19 615 078
Stock price at closing date		16.54	15.50
IFRS NAV per share9		24.23	21.30
Premium compared to IFRS NAV (at closing date)		-31.7%	-27.2%
EPRA NTA per share10		23.24	20.36
Premium compared to EPRA NTA (at closing date)		-28.8%	-23.9%

1. The debt ratio (RREC Royal Decree) is the debt ratio calculated in accordance with the RREC Royal Decree. This means that for the purposes of calculations of the debt ratio, participations in associated companies and joint ventures are processed following the proportionate consolidation method.
2. The debt ratio (IFRS) is calculated like the debt ratio (RREC Royal Decree) but based on and conciliating with a consolidated balance in accordance with IFRS where participations in joint ventures and associated companies are processed following the equity method.
3. The average number of shares is calculated excluding the own shares held by the company.
4. IFRS NAV per share = Net Asset Value or Net Value per share according to IFRS.
5. EPRA NTA per share = Net tangible assets per share following the Best Practices Recommendations of EPRA.

6	RESULTS OF THE 1ST QUARTER 2024

3.1. NOTES TO THE CONSOLIDATED INCOME STATEMENT

NET RENTAL INCOME

For the first three months of 2024, the net rental income amounted to € 9.00 million (compared to € 8.53 million during the first three months of 2023).

OPERATING RESULT BEFORE THE PORTFOLIO RESULT

The operating result before the portfolio result amounted to € 4.61 million during the first three months of 2024 (compared to € 4.08 million during the first three months of 2023).

The operating margin11 increased to 51.2 % in the three first months of 2024 (compared to 47.8 % during the first three months of 2023).

PORTFOLIO RESULT

During the first three months of 2024, Home Invest Belgium recorded a portfolio result of € 52.84 million.

The result on the sale of investment properties amounted to € 2.14 million during the first three months of 2024. Home Invest Belgium sold investment properties in this period for a net sales value of € 6.62 million. The net sales value was 47.7% above the fair value as estimated by the independent real estate expert on 31 December 2023.

In addition, during the first three months of 2024, Home Invest Belgium recorded a positive change in the fair value of its investment properties amounting to € 50.78 million. These variations consist of:

• A positive variation of € 50.41 million in Belgium; and
• A positive variation of € 0.36 million in the Netherlands.

These positive variations in the fair value of the investment properties result from the increase in rents and an adjustment of the valuation methodology by the independent real estate experts. The rental value of the investment properties available for rent, as estimated by the independent property appraisers, increased by 4.2% in the first 3 months of 2024 (31-03-2024 compared to 31-12-2023). To better reflect the market value of the property portfolio, the real estate experts now also partially take into account the value of a sale by unit when determining the fair value of properties. This adjusted methodology and the increase in rental value reflects in an upward valuation of the portfolio on 31 March 2024 by 6.7%.

The other portfolio result amounted to - € 0.07 million. This item includes the variations in deferred taxes.

FINANCIAL RESULT

The net interest charges amounted to € 1.43 million during the first three months of 2024. The average cost of debt12 amounted to 2.10 % during the same period.

The changes in the fair value of the financial assets and liabilities amounted to € 0.88 million in the first 3 months

1. Operating margin = (operating result before portfolio result) / (net rental income)
2. The average funding cost is the interest costs including the credit margin and the cost of hedge instruments and increased by capitalised interests divided by the weighted average financial debt over the period in question.

7	RESULTS OF THE 1ST QUARTER 2024

of 2024. These changes are the consequence of a change in the fair value of the interest rate swaps.

TAXES

Taxes amounted to € -0.09 million during the first three months of 2024 (compared to € -0.08 million in the first three months of 2023).

NET RESULT

The net result (group share) of Home Invest Belgium amounted to € 57.32 million in the first 3 months of 2024, or € 2.92 per share.

EPRA EARNINGS

After adjustment of the net result for (i) the portfolio result, (ii) the changes in the fair value of the financial assets and liabilities, and (iii) the non-EPRA elements of the share in the result of associated companies and joint ventures, the EPRA earnings amount to € 3.47 million during the first three months of 2024, an increase of 11.9% (compared to € 3.10 million during the first three months of 2023).

EPRA earnings per share increased by 1.5% from € 0.17 during the first three months of 2023 to € 0.18 during the first three months of 2024.

3.2. NOTES TO THE CONSOLIDATED BALANCE SHEET

SHAREHOLDER'S EQUITY AND NAV PER SHARE

On 31 March 2024, the shareholder's equity of the group stood at € 475.18 million, which is an increase of 13.7% compared to 31 December 2023.

The IFRS NAV per share increased by 13.7% to stand at € 24.23 at 31 March 2024 (compared to € 21.30 at 31 December 2023).

The EPRA NTA per share increased by 14.2% to stand at € 23.24 at 31 March 2024 (compared to € 20.36 at 31 December 2023).

8	RESULTS OF THE 1ST QUARTER 2024

3.3. FUNDING STRUCTURE DEBT RATIO

The debt ratio (RREC Royal Decree) amounted to 47.13% at 31 March 2024. The debt ratio (IFRS) amounted to 46.00%.

Considering a maximum permitted debt ratio of 65%, Home Invest Belgium still has a debt capacity of € 443.55 million, as defined by the RREC Royal Decree, in order to fund new investments.

Considering Home Invest Belgium's strategy to keep the debt ratio in the medium and long term below 55%, Home Invest Belgium still has a debt capacity of € 151.82 million to fund new investments.

DEBT COMPOSITION

At 31 March 2024, Home Invest Belgium had € 384.00 million in financial debts composed of:

• Bilateral credit lines drawn for an amount of € 288.00 million with 7 different financial institutions, with well spread maturity dates until 2030. There are no maturities in 2024. The first coming maturity dates fall in the second half of 2025;
• Bonds for an amount of € 49.00 million, maturing between 2028 and 2032;
• A € 40.00 million bond maturing in June 2024 for which long-term bank credit lines are already ready for refinancing;
• Short term treasury notes ("commercial paper") for an amount of € 7.00 million. Notwithstanding the short-term nature of the outstanding commercial paper, the outstanding amount is fully covered by available long-term credit lines (back-up lines).

MATURITY OF DEBTS (€ MIO)

160

140

120

100

80									20
60						30		20			35
40	7							77
40				43	55	35	42	10	40
20
	15		9			22
0
2024	2025	2026	2027	2028	2029	2030	2031	2032
					Maturity dates of bonds				Maturity dates of used credit lines
					Maturity dates of available credit lines			Maturity dates of treasury notes

9	RESULTS OF THE 1ST QUARTER 2024