Balance sheet as at 31 December 2020: CA Immo continues operating profit growth and exceeds annual target
Increases in rental income, EBITDA and FFO through continued portfolio growth
- Recurring earnings (FFO I) up 0,4% on last year to € 133.8 m (€ 1.44 per share); annual target of at least € 126 m solidly exceeded
- Net rental income increased by 8% to € 209.7 m (31.12.2019: € 194.7 m)
- Operating result (EBITDA) of € 195.6 m 14% above the previous year's value of € 171.7 m. Adjusted for a one-off effect (provision for possible court fees), the EBITDA is € 221.1 m (+29% compared to the previous year)
- Positive revaluation result of € 183.5 m reflects, among other things, the profitable development activities and the persistently attractive market environment, especially in Germany (31.12.2019: € 462.8 m)
- Strong consolidated net profit of 254.0 m significantly below the previous year´s figure (31.12.2019: € 393.3 m), mainly due to the lower revaluation result year-on-year
- Property assets increased by 8% to € 5.6 bn driven by strong organic growth
- Net asset value EPRA NAV per share at € 41.05 after € 38.37 as of 31.12.2019 (+7%)
- Dividend proposal for the 2020 financial year: € 1.0 per dividend-bearing share
CA Immo reports another consecutive year of increased operating profit and a clearly positive consolidated net profit. Portfolio growth through own project completions and portfolio acquisitions in combination with the continued high occupancy rate of the investment portfolio (occupancy rate: 95%) led to a further increase in net rental income (+8% compared to the previous year) and the operating result (+14%). Although the record result of 2019 could not be surpassed – primarily due to the significantly lower revaluation result compared to the previous year – the path of consistent value creation and increase was continued.
Andreas Quint, CEO of CA Immo: "We met the exceptional year 2020 with continuity by consistently pursuing the strategic path we have taken to date: continued organic growth through our own project developments and targeted portfolio acquisitions of high-quality office properties in central locations in our core cities. At the same time, we pressed ahead with various strategic projects – such as the successful issue of bonds with a total volume of € 850 m and our integrated sustainability initiative – in order to make CA Immo even more stable and secure for the future. The result is sustainable growth and a resilience that has enabled us to navigate confidently through the crisis year 2020. This rock-solid and at the same time highly dynamic operating performance allows us to look forward with great optimism to another year of strong growth in 2021 from a position of strength."
Results of the business year 2020
FFO I, a key indicator of the Group’s long-term earning power, is reported before taxes and adjusted for the sales result and other non-recurring effects. In 2020, a FFO I of € 133.8 m was generated, 0.4% above the previous years’ value of € 133.3 m. FFO I per share stood at € 1.44 at the reporting date (31.12.2019: € 1.43 per share). The FY 2020 guidance of > € 126 m was therefore exceeded. FFO II, which includes the sales result and applicable taxes and indicates the Group's overall profitability, was € 141.1 m compared to € 122.3 m in 2019 (+15.4% compared to the previous year). FFO II per share stood at € 1.52 (31.12.2019: € 1.31).
Rental income increased by 6.7% to € 235.6 m in 2020. In addition to the successful management of the investment portfolio with a high occupancy rate, this positive development is related to the organic portfolio growth of the past months. The net rental income attributable to leasing activities after the deduction of direct management costs rose by 7.7% from € 194.7 m to € 209.7 m. The Covid-19 pandemic had a negative impact of € –7.8 m on the net rental income as of the balance sheet date. This mainly relates to individual value adjustments and, to a lesser extent, rent reductions, which, however, are offset by countervailing effects from incentive agreements (rent-free periods).
Property sales result
The earnings contribution from the trading portfolio totalled € 7.9 m (31.12.2019: € –1.3 m). At € 43.9 m, profit from the sale of investment properties was above the previous year's value of € 15.6 m. The biggest contribution came from the sale of the cube berlin office building.
Indirect expenditures rose by 68.4% from € –43.5 m in the previous year to € –73.2 m in 2020. The figure includes potential court fees associated with the action for damages brought by CA Immo against the Republic of Austria and the State of Carinthia in the second quarter of 2020 in connection with the privatisation of the federal housing companies (BUWOG) completed in 2004. Adjusted for this one-off effect of around € –25.5 m, indirect expenses were at € –47.7 m, 9.7% higher than in the previous year.
Earnings before interest, taxes, depreciation and amortization (EBITDA) of € 195.6 m were up 13.9% on the previous year's level of € 171.7 m. This growth is mainly based on the higher rental income and the significantly increased sales result compared to 2019. EBITDA adjusted for the BUWOG one-off effect amounted to € 221.1 m, a significant increase of 28.7% compared to the previous year's value, which reflects the company's robust operating business development.
The revaluation result of € 183.5 m as at 31 December 2020 was extraordinarily positive, but significantly below the previous year's figure (31.12.2019: € 462.8 m). The result reflects the continued attractive market environment in Germany and particularly in Berlin, CA Immo's largest portfolio segment, despite the Covid-19 pandemic. In addition, the company's profitable property development activities generated positive value adjustments, both in terms of the progress of ongoing construction projects and the development of land reserves. On the other hand, there were also negative effects, which were primarily concentrated on properties directly affected by the consequences of the pandemic with the main types of use being hotels and retail, as well as on investment buildings in CEE.
Earnings before interest and taxes (EBIT) totalled € 375.4 m and were thus 40.8% below the corresponding figure for the previous year (€ 633.7 m), in particular due to the lower revaluation result.
The financial result in 2020 totalled € –27.2 m compared to € –94.4 m in the previous year. The Group's financial expenses, a key component of the recurrent net income, were below the previous year's level at € –42.3 m (31.12.2019: € –43.1 m). The result from derivatives amounted to € 21.4 m (31.12.2019: € –59.2 m). The 2020 figure includes a derivative valuation of the convertible bond issued in October 2017 in the amount of € 32.2 m. This instrument consists of a debt component and, due to the repayment option in cash of CA Immo, an embedded derivative which must be separated. The embedded derivative of the convertible bond is reported at fair value. The interest rate development over 2020 also resulted in a negative valuation effect of the company's interest rate derivatives in the amount of € –10.8 m (31.12.2019: € –20.7 m).
Earnings before taxes (EBT) of € 348.3 m (31.12.2019: € 539.3 m) recorded a significant year-on-year decline of 35.4% based on the earnings developments described above.
At € 253.9 m, net profit for the period was 35.4% below the previous year's figure of € 393.3 m. Earnings per share (undiluted) amounted to € 2.73 (31.12.2019: € 4.23 per share).
Further increase in shareholder value
The net asset value (NAV = IFRS equity) per share increased by 5.4% to € 33.63 (undiluted) as of the reporting date (31.12.2019: € 31.90 per share). EPRA NAV (undiluted) was € 41.05 per share as at the reporting date (31.12.2019: € 38.36 per share), an increase of 7.0%. EPRA NNNAV – after adjustments for financial instruments, liabilities and deferred taxes – amounted to € 36.15 per share as at 31.12.2020 (31.12.2019: € 33.69 per share).
Robust balance sheet and high liquidity
The company continues to have an extremely robust balance sheet with a solid equity ratio of 45.9% (31.12.2019: 50.4%), reflected in conservative debt ratios such as gearing (net debt to equity) of 60.4% (31.12.2019: 55.8%) and a loan-to-value ratio (financial liabilities less cash to property assets) of 33.8% (31.12.2019: 31.9%). The Group's average financing costs (including interest rate hedges) stood at 1.50% as at the reporting date compared to 1.57% at the end of 2019. Cash and cash equivalents totalled € 934.9 m as at the reporting date and were thus significantly higher than the level as at 31.12.2019 (€ 439.1 m). This significant increase reflects, among other things, part of the net proceeds of around € 400 m from CA Immo's Eurobond capital market transaction carried out in the first quarter and the first-time issue of a green bond in the fourth quarter with a volume of € 350 m.
Property assets further increased to € 5.6 bn
Due to the transfer of own project completions to the portfolio, portfolio acquisitions and a positive valuation result, the book value of the property assets increased further by 8% during the year to € 5.6 bn as at 31.12.2020 (31.12.2019: € 5.2 bn). Property assets include investment properties (85% of the total portfolio) and investment properties under development (14%), the remaining 1% is accounted for by short-term property assets (intended for trading and sale). Of the investment portfolio with a value of approx. € 4.7 bn (31.12.2019: € 4.3 bn), 47% account for Germany, 42% for CEE and 11% for Austria. The portfolio yield was 5.2%) (31.12.2019: 5.5%)); the occupancy rate stood at 94.8%1) (31.12.2019: 96.1%2)). Properties under development include projects under development and land reserves with a total book value of around € 826 m (incl. projects and land reserves intended for trading and sale), of which Germany accounts for 95% and CEE for 5%.
Successful capital rotation with portfolio expansion in Berlin, Warsaw and Munich
In 2020, CA Immo added five office buildings with a total lettable area of around 80,400 sqm to its existing portfolio: two project completions in Berlin and Munich and three portfolio acquisitions (two in Berlin, one in Warsaw). At the same time, the sales programme continued with, among other things, the sale of the cube berlin office building, a residential building developed by CA Immo in Munich and some non-core land reserves in Germany. The sale of the Zagrebtower office building marked the exit from the secondary market in Croatia. All sales were concluded at prices above the last book value – which underlines the value of the portfolio in the current uncertain market environment. With this strategic capital rotation, CA Immo is strengthening the quality of sustainable earnings, improving portfolio quality and management efficiency, and expanding in its core markets.
Outlook for 2021
The main challenge for the current year remains the fight against the Covid-19 pandemic. Possible improvements in the pandemic situation, accompanied by a recovery in economic growth across the board, are heavily dependent on the progress of vaccinations. Although the ultimate effects of the pandemic and the economic consequences cannot be conclusively assessed because of the speed of developments, CA Immo continues to monitor the situation and deploys a wide range of measures to minimise the impact on the Group. Despite the continuing uncertain environment, CA Immo continues to expect only minor or short-term effects of the Covid-19 pandemic on its operating business.
In addition to the strategic capital rotation programme, organic growth in the core markets through profitable project development activities is to be continued in 2021.
Dividend and annual target 2021
For the 2020 financial year, the Executive Board proposes a dividend of € 1.00 per dividend-bearing share (dividend amount unchanged from the previous year). The annual target for the sustainable result of the financial year 2021 (FFO I) will be announced during the presentation of the first quarter in May 2021.
The Annual Report 2020 of CA Immobilien Anlagen AG is available at:
) Excl. the project completions NEO (Munich) and quarter garage Zollhafen Mainz, which are still in the stabilisation phase
) Excl. the project completions Orhideea Towers (Bucharest), ViE (Vienna) and MY.O (Munich), which are still in the stabilisation phase as at 31 December 2019