ADO Properties S.A. concludes first nine months of the financial year 2019 with positive figures

Press Release

ADO Properties S.A. concludes first nine months of the financial year 2019 with positive figures

- Solid growth of the income from rental activities (+7.9%)

- EBITDA from rental activities rises by +2.5% - FFO1 close to prior year level

- Portfolio value rises to almost EUR 4.5 billion - Conservative financial structure

- EPRA Net Asset Value per share at EUR 62.47 as of 30 September 2019
(31 December 2018: EUR 55.05)

- Active asset management and portfolio optimisation reduce vacancy rate by 70 basis points since the beginning of the year

Berlin, 13 November 2019 - ADO Properties S.A. closed the first nine months of fiscal 2019 with positive results. This is reflected by the key figures and the interim management report for the first nine months 2019 published today.

Probably the most important transaction in the third quarter was the sale of one of the company's largest portfolios with approximately 5,900 apartments and 70 commercial units to Gewobag Wohnungsbau AG Berlin. The sale price of EUR 920 million reflects not only the positive performance of the Berlin real estate market in recent years, but also ADO Properties' extensive investments in these properties and active asset management. Among other things, this led to an increase in the occupancy rate to around 98 percent and to an increase in the portfolio value.

Solid operating performance
The income from rental activities of ADO Properties increased in the first nine months of 2019 by 7.9% to EUR 107.5 million (9M 2018: EUR 99.6 million) thanks to stable 4.4% like-for-like rental growth. The EBITDA from rental activities rose by 2.5% from EUR 70.7 million in the first nine months 2018 to EUR 72.4 million in the reporting period. At EUR 50.4 million, the FFO1 (from rental activities) was almost at the previous year's level, equivalent to an FFO1 of EUR 1.14 per share.

The average in-place rent of the residential portfolio rose to EUR 6.89 per sqm per month at the end of the third quarter 2019 (31 December 2018: EUR 6.73). Thanks to ADO's active management and continuous portfolio optimization the vacancy rate for the residential portfolio decreased by 70 basis points since the beginning of the year to 2.5% as of 30 September 2019 (31 December 2018: 3.2%).

ADO Properties' portfolio value has grown by EUR 374.0 million to EUR 4,466 million as of 30 September 2019. It comprised 23,613 units at the end of the reporting period, of which 22,157 are residential units (31 December 2018: 22,202 units). The EPRA Net Asset Value of the portfolio amounted to EUR 2.8 billion or EUR 62.47 per share, as of 30 September 2019.

The company's financial structure remained solid and conservative with an LTV of only 21.0% at the end of the reporting period. The sharp decline in LTV compared to the previous quarter is mainly attributable to the aforementioned sales transaction. The average interest rate on all outstanding long-term debts is 1.6% with an weighted average maturity of the outstanding debts of approximately 4.1 years. Almost all loans have fixed interest rates or are hedged.

"After the sale of one of our biggest portfolios we are currently looking into a variety of different options for putting the proceeds of this sale to best use. These include the prepayment of existing obligations, utilization for general company purposes and the acquisition of further real estate", says Ran Laufer, CEO of ADO Properties. "In view of the positive development during the first nine months of the year, we still expect our FFO 1 run rate for 2019 as a whole to be approximately EUR 65 million (without the effect of the disposal groups classified as held for sale). However, the situation on the Berlin real estate market remains marked by the strong uncertainty caused by the rent cap planned by the Berlin Senate. Against this background we will continue to refrain from a guidance on our anticipated like-for-like rental growth."

Definitions of our alternative performance measures like FFO1 or EPRA NAV are available in our latest financial report under http://ado.properties/websites/ado/English/4000/publikationen.html#reports in the Financial Performance Indicators section.

About ADO Properties

ADO Properties is a company that focuses on the residential real estate sector and owns a property portfolio of around 24,000 units in Berlin (before the disposal as mentioned above). The company operates an entirely integrated, scalable in-house platform that includes a dedicated property administration. The portfolio of ADO Properties is concentrated in central locations inside Berlin's S-Bahn-Circle and in attractive districts on the city's periphery.