VONOVIA SE
Interim Statement 2024/Q1
Key Figures
Financial Key Figures in € million | 3M 2023* | 3M 2024 | Change in % | 12M 2023 | |||
Adjusted EBITDA Total (continued operations)* | 627.9 | 607.0 | -3.3 | 2,583.8 | |||
Adjusted EBITDA Rental | 584.2 | 592.9 | 1.5 | 2,401.7 | |||
Adjusted EBITDA Value-add | 26.4 | 11.5 | -56.4 | 105.5 | |||
Adjusted EBITDA Recurring Sales | 21.8 | 9.1 | -58.3 | 63.4 | |||
Adjusted EBITDA Development* | -4.5 | -6.5 | 44.4 | 13.2 | |||
Adjusted EBITDA from discontinued operations | 13.0 | 14.5 | 11.5 | 53.9 | |||
Adjusted EBT (continued operations)* | 449.1 | 416.5 | -7.3 | 1,866.2 | |||
Adjusted EBT (continued operations) per share in €** | 0.56 | 0.51 | -9.4 | 2.31 | |||
Adjusted EBT (continued operations) after minorities | 421.5 | 375.2 | -11.0 | 1,730.2 | |||
Adjusted EBT (continued operations) after minorities per | |||||||
share in €** | 0.53 | 0.46 | -13.0 | 2.12 | |||
Income from fair value adjustments of | |||||||
investment properties* | -3,612.2 | - | -100.0 | -10,651.2 | |||
Earnings before tax (EBT)* | -3,193.9 | 409.8 | - | -9,185.2 | |||
Profit for the period | -2,088.1 | 335.5 | - | -6,756.2 | |||
Operating Free Cash-Flow | 404.0 | 501.0 | 24.0 | 1,414.8 | |||
Cash flow from operating activities | 516.4 | 620.0 | 20.1 | 1,901.2 | |||
Cash flow from investing activities | -61.1 | 69.0 | - | -825.9 | |||
Cash flow from financing activities | -460.3 | -611.2 | 32.8 | -961.0 | |||
Total Sum of Maintenance, Modernization, Portfolio | |||||||
InvestmentsandNewConstruction | 344.9 | 316.6 | -8.2 | 1,484.5 | |||
thereof for maintenance measures* | 168.9 | 161.0 | -4.7 | 722.5 | |||
thereof for modernization & portfolio investments* | 122.0 | 107.8 | -11.6 | 470.8 | |||
thereof for new construction* | 54.0 | 47.8 | -11.5 | 291.2 | |||
Key Balance Sheet Figures/Financial Covenants in € million | Dec. 31, 2023 | Mar. 31, 2024 | Change in % | |||
Fair value of the real estate portfolio | 83,927.7 | 83,663.8 | -0.3 | |||
EPRA NTA | 38,140.9 | 38,062.9 | -0.2 | |||
EPRA NTA per share in €*** | 46.82 | 46.72 | -0.2 | |||
LTV (%) | 47.3 | 46.9 | -0.8 | |||
Net debt/EBITDA | 15.6x | 15.7x | 0.1x | |||
ICR | 4.0x | 3.8x | -0.2x |
Non-financial Key Figures | 3M 2023 | 3M 2024 | Change in % | 12M 2023 | |||
Number of units managed | 618,951 | 613,306 | -0.9 | 617,343 | |||
thereof own apartments | 548,368 | 543,427 | -0.9 | 545,919 | |||
thereof apartments owned by others | 70,583 | 69,879 | -1.0 | 71,424 | |||
Number of units bought | 63 | - | -100.0 | 63 | |||
Number of apartments sold | 663 | 2,816 | >100 | 3,838 | |||
thereof Recurring Sales | 282 | 407 | 44.3 | 1,590 | |||
thereof Non Core/other | 381 | 2,409 | >100 | 2,248 | |||
Number of new apartments completed | 779 | 845 | 8.5 | 2,425 | |||
thereof own apartments | 675 | 153 | -77.3 | 1,309 | |||
thereof apartments for sale | 104 | 692 | >100 | 1,116 | |||
Vacancy rate (in %) | 2.2 | 2.2 | - | 2.0 | |||
Monthly in-place rent in €/m² | 7.54 | 7.78 | 3.2 | 7.74 | |||
Organic rent increase (in %) | 3.4 | 3.8 | 0.4 pp | 3.8 | |||
Carbon intensity achieved in Germany (in kg CO₂e/m²) | 33.0 | 31.7 | -3.9 | 31.7 | |||
Number of employees (as of Mar. 31/Dec. 31)* | 12,009 | 11,999 | -0.1 | 11,977 |
- Previous year's values (2023) adjusted to current key figure and segment definition.
- Based on the weighted average number of shares carrying dividend rights.
- Based on the shares carrying dividend rights on the reporting date.
3 | Vonovia SE Interim Statement for the First Quarter of 2024 |
Contents
Business Development in the First Three Months of 2024
2 Overview
4 Vonovia SE on the Capital Market
- Economic Development in the First Three Months of 2024
- Business Outlook
Condensed Interim Consolidated Financial Statements
- Consolidated Income Statement
- Consolidated Statement of Comprehensive Income
- Consolidated Balance Sheet
26 Consolidated Statement of Cash Flows
Information
28 Portfolio Information
30 Financial Calendar, Contact
Contents | 1 |
Business
Development in
the First Three
Months of 2024
Overview
- A positive start to the new fiscal year in the core Rental business, with high customer satisfaction levels and virtually full occupancy.
- Unchanged overall conditions for real estate sales.
- CHF and GBP borrowing markets opened up through successful bond placements.
2 Overview
4 Vonovia SE on the Capital Market
7 Economic Development in the First Three Months of 2024
19 Business Outlook
2 | Vonovia SE Interim Statement for the First Quarter of 2024 |
Sustained Earnings Power
Adjusted EBT*
inmillion
•• | 449.1 | ||||||||||
••• | -••% | 416.5 | |||||||||
•• | |||||||||||
•• | •• ' | ||||||||||
-€••% | |||||||||||
•• - | |||||||||||
-•• | |||||||||||
• | |||||||||||
M• | M•• | ||||||||||
AdjustedEBTpershare()*
* Continuing operations.
Maintenance, Modernization and New Construction
Capital Expenditure*
inmillion
168.9 | 161.0 | |
122.0 | 107.8 | |
54.0 | 47.8 | |
M | M | |
Maintenance | Modernization | New construction |
* Continuing operations.
Organic Rent Growth | Vacancy | ||||||||||||||
Organic Rent Increase | Vacancy Rate | ||||||||||||||
in% | in% | ||||||||||||||
pp | 3.8 | ||||||||||||||
3.4 | 2.2 | pp | 2.2 | ||||||||||||
M | M | Mar | Mar | ||||||||||||
Net Assets | Fair Value of the Real Estate Portfolio |
EPRA NTA | Fair Value |
inmillion | inmillion | |||||
38,140.9 | −% | 38,062.9 | -% | |||
83,927.7 | 83,663.8 | |||||
•• | ||||||
−% | •• | |||||
Dec | Mar | Dec | Mar | |||
EPRANTApershare |
Business Development in the First Three Months of 2024 - Overview | 3 |
Vonovia SE on the Capital Market
Shares in Vonovia
The capital markets continue to be mainly influenced by the outlook for the macroeconomic environment and thus, in particular, the interest rate trend. To date, the expectation of imminent interest-rate cuts in the USA and Europe which was prevalent in the fourth quarter of 2023 has not been borne out. At the same time, the market has further post poned the expected timing of initial interest rate cuts. As things currently stand, the ECB is generally expected to implement its first key interest-rate cut in June. Most capital market players now anticipate that an initial cut from the Fed will follow at a later moment in time. Moreover, a number of market observers expect that the Fed will not make any changes at all in 2024. The evolving view of the interest rate landscape is likely to remain a key factor driving market developments.
In the first three months of 2024, the German Stock Index (DAX 40) achieved a positive performance of +10.4% and reached a new all-time high of 18,513.83 points. Various indices have also realized strong gains in the USA. On the one hand, this has been driven by the high level of demand for tech stocks. On the other, the U.S. economy has on the whole delivered a more robust performance than had been generally expected.
The European real estate sector declined by -3.5% in the first three months of the year. This is likely primarily attributable to the dampening of expectations of imminent interest rate cuts by comparison with the fourth quarter of 2023.
At the end of the first quarter, shares in Vonovia were trading at € 27.40 and were thus down 4.0% on the closing price for 2023. In our view, the interest rate situation is once again the key factor here.
As a result, we are still observing an ever-wider gap between capital market expectations on the one hand, and what remains a very attractive market situation for residential real estate on the other. The residential property markets in which we operate are characterized by a high level of excess demand. Moreover, real estate value adjustments contrast with rising rents and a significant supply shortage.
As a result, we remain confident that the fundamental conditions in our markets will ensure positive development in the long run. Besides the favorable relationship (from an owner's point of view) between supply and demand in urban regions, the relevant factors here include, above all, structural momentum on the revenue side as well as support from the key megatrends.
Vonovia's market capitalization amounted to around € 22.3 billion as of March 31, 2024.
4 | Vonovia SE Interim Statement for the First Quarter of 2024 |
Share Price Development
Vonovia SE | DAX | FTSE EPRA Europe | Source: FactSet | ||
in %
Feb. 2024 | Mar. 2024 | |
Jan. 2023 |
Shareholder Structure
The following chart shows the company's shareholdings based on the data it collects itself and/or based on the voting rights pursuant to Sections 33 and 34 of the German Securities Trading Act (WpHG) as notified by the share holders in relation to the current share capital.
Major Shareholders (as of March 31, 2024)
3.0% DWS Investment | 70.9% Other Free Float | |
3.8% APG | ||
7.4% BlackRock | ||
14.9% Norges Bank |
Based on the German stock exchange's definition of free float, only the interest held by Norges Bank (Ministry of Finance on behalf of Norway) does not count toward the free float. This means that 85.1% of Vonovia's shares were in free float on March 31, 2024. The underlying voting rights notifications and corresponding financial instruments reported by shareholders or other instruments pursuant to Sections 38 and 39 WpHG can be found online.
In line with Vonovia's long-term strategic focus, we believe that the majority of its investors also have a long-term focus. The company's investors include pension funds, sovereign wealth funds and international asset managers in particular. There are also private shareholders, although they only represent a small proportion of the total capital (9.5%).
Business Development in the First Three Months of 2024 -VonoviaSE on the Capital Market | 5 |
Investor Relations Activities
Vonovia SE is committed to a transparent, ongoing dialogue with its shareholders and potential investors. We continued with our roadshows and meetings in the first three months of the 2024 fiscal year, in the form of virtual and face-to-face events. We took part in a total of seven investor conferences and organized ten roadshow days.
In addition, numerous one-on-one meetings, video con ferences and conference calls were held with investors and analysts to keep them informed of current developments and special issues. Interest rates and capital structure- related topics dominated conversation in the first three months of 2024.
We will continue to communicate openly with the capital market. Various roadshows, conferences and participation in investor forums have already been planned. Information can be found in the Financial Calendar on our Investor Relations website.
Analyst Assessments
As of March 31, 2024, 25 international analysts were publish ing research studies on Vonovia. The average target share price was € 32.20. Of these analysts, 72% issued a "buy" recommendation, with 16% issuing a "hold" recommendation and 12% a "sell" recommendation.
Share Information (as of March 31, 2024)
First day of trading
Subscription price
Total number of shares
Share capital
ISIN
WKN
Ticker symbol
Common code
Share class
Stock exchange
Market segment
Indices
July 11, 2013
-
16.50 | € 14.71*
814,644,998 - 814,644,998
DE000A1ML7J1
A1ML7J
VNA 94567408
Registered shares with no par value Frankfurt Stock Exchange Regulated market
DAX 40, DAX 50 ESG, Dow Jones Sustainability Index Europe, STOXX Global ESG Leaders, EURO STOXX ESG Leaders 50, FTSE EPRA/ NAREIT Developed Europe and GPR 250 World
- TERP-adjusted.
6 | Vonovia SE Interim Statement for the First Quarter of 2024 |
Economic Development in the First Three Months of 2024
Key Events During the Reporting Period
The core Rental business has got off to a successful start in the 2024 fiscal year. This was mainly based on a high level of demand for rental apartments and a positive rent trend.
With a vacancy rate of 2.2% at the end of the first quarter of 2024 (end of the first quarter of 2023: 2.2%), Vonovia's residential real estate portfolio was virtually fully occupied.
To date, the overall conditions for the other operating segments are virtually unchanged in the first quarter of 2024 by comparison with the past fiscal year. The interest rate level is continuing to hamper potential transactions in the Recurring Sales and Development segments.
In the first quarter of 2024, the Customer Satisfaction Index (CSI) was 0.6 percentage points below the value seen in the previous year. The level of customer satisfaction has increased by 0.1 percentage points by comparison with the average for the year 2023 as a whole.
On January 18, 2024, Vonovia issued a bond on the UK financial market for the first time. This unsecured bond has a 5.5% coupon (4.55% after currency hedging) and a twelve- year term. It has a volume of GBP 400 million (approx.
€ 465.1 million).
Vonovia successfully placed a further unsecured bond with a volume of CHF 150 million (approx. € 159.3 million) on February 14, 2024. This bond has a term expiring in 2029 and a 2.565% coupon (4.16% after currency hedging).
With these two bonds, Vonovia has opened up additional financial markets and access to potential debt investors, while at the same time exploiting arbitrage advantages.
Following the end of the first quarter, on April 10, 2024 Vonovia issued an unsecured social bond with a 4.25% coupon rate and a ten-year term. It had a volume of
- 850 million. This bond's terms are consistent with the Sustainable Finance Framework which the company defined in February 2022.
In addition, in early April Vonovia repaid a two-year social bond with a volume of SEK 500 million (approx. € 50 million) in Sweden.
On April 8, 2024, a € 336.1 million bond was repaid as scheduled.
With regards to Vonovia's efforts to sell off its Care seg- ment, in mid-April it successfully concluded sales contracts for three properties. It continues to expect to complete the sale of its Care segment by December 31, 2024.
As part of Vonovia's efforts to sell off a portfolio in Berlin, a notarized sales contract was successfully concluded on April 23, 2024. Two companies with around 4,500 residential units and a real estate value of approx. € 700.0 million will be disposed of within the scope of this transaction. The transaction is expected to be closed on December 31, 2024.
For these sales transactions, Vonovia expects overall to realize a sale at the fair value of the underlying real estate portfolios.
With the publication of the 2023 annual financial statements on March 14, 2024, the Management Board and the Super visory Board reported that they would provide the Annual General Meeting of Vonovia SE with a proposal to distribute a dividend of € 0.90 per share for the 2023 fiscal year. This amount is approx. 6% higher than the previous year's dividend.
From the 2024 fiscal year onwards, a modified management system has been introduced. This uses the Adjusted EBT indicator and is thus more clearly focused on profitability and internal financing. In the future, this performance
Business Development in the First Three Months of 2024 -Vonovia SE on the Capital Market | Economic Development in the First Three Months of 2024 7
indicator will also serve as the key parameter for Vonovia's dividend policy.
On March 28, 2024, the rating agency Fitch awarded
Vonovia an investment grade rating for the first time: BBB+ with a stable outlook. As positive factors, its analysis emphasizes the stability of the regulated rental housing market in Germany, the strong level of demand for residential units and Vonovia's very high occupancy rate (98%).
As reported, on March 7, 2023, Vonovia was informed by the public prosecutor's office in Bochum during the course of necessary search measures connected to an ongoing investigation that former and, at that time, current technical employees were being investigated on suspicion of corrup- tion. The persons under suspicion may also have caused damage for Vonovia by overriding and circumventing controls and compliance policies. Vonovia continues to co operate fully with the investigating authorities.
The auditing firm Deloitte and the law firm Hengeler Mueller were commissioned to perform a forensic assessment of all the facts of the case. They have determined that Vonovia's tenants have not suffered any harm.
The loss incurred by Vonovia has been calculated as not more than 1% of the order volume awarded by Vonovia, which corresponds to a low single-digit million amount.
Results of Operations
Overview
Vonovia started the new fiscal year with a first quarter that was largely in line with expectations. Core business in the Rental segment showed positive economic development, bolstered by strong demand for rental apartments and positive rental price development. The overall conditions for the other segments remained subdued and virtually un- changed.
The following key figures provide an overview of the development of Adjusted EBT and other value drivers in the reporting period.
Any analysis of the figures reported has to consider the fact that the prior-year figures are reported based on the current segmentation.
The sale of the Care business activities has since been initiated by the Management Board of Deutsche Wohnen and this segment is expected to be sold before December 2024. Accordingly, the majority of the Care segment is presented as a discontinued operation. A small part of the original Care segment (25 properties operated by third parties) was transferred to the Rental segment and generated a business volume of € 6.1 million in segment revenue in the first quarter of 2024 (first quarter of 2023: € 6.0 million).
8 | Vonovia SE Interim Statement for the First Quarter of 2024 |
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Vonovia SE published this content on 30 April 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 30 April 2024 05:05:01 UTC.