HAMBORNER REIT AG: Positive business performance continues in third quarter – further growth in revenue and earnings – FFO forecast for 2023 raised again

PRESS RELEASE

HAMBORNER REIT AG: Positive business performance continues in third quarter – further growth in revenue and earnings – FFO forecast for 2023 raised again

• Successful operating business performance in consistently challenging market environment
• Positive revenue effects from indexation agreements
• Increase in income from rents and leases by 4.8% to €66.2 million
• FFO climbs 13.3% year-on-year to €42.2 million
• Fair value of property portfolio €1.542 billion after addition of two retail properties
• Net asset value (NAV) per share of €10.76 (down 9.3% YTD)
• Revenue projection confirmed and FFO forecast for 2023 raised again

KEY FIGURES AS AT 30 SEPTEMBER 2023

Duisburg, 9 November 2023 – In a consistently difficult economic environment, HAMBORNER REIT AG continued its positive operating performance as planned in the third quarter of 2023.

Income from rents and leases amounted to €66.2 million, up 4.8% on the same period of the previous year. In particular, the development was positively influenced by property additions and contractually agreed rent adjustments as a result of the rise in inflation (indexation clauses). The resulting effects amounted to 3.8% as at 30 September 2023 (like-for-like).

The development in funds from operations (FFO) was very positive in the first nine months of the current year, rising by around €4.9 million or 13.3% year-on-year to €42.2 million with FFO per share of €0.52 (previous year: €0.46). Besides growth in rents, the increase was primarily attributable to interest income and other operating income in connection with the early termination of a lease.

The company’s financial situation remains comfortable. The REIT equity ratio was 56.5% as at 30 September 2023. Loan to value (EPRA LTV) rose to 42.4% during the year as against the end of 2022 as a result of a value adjustment of the property portfolio and the dividend payment in the second quarter.

PORTFOLIO DEVELOPMENT

Having already conducted an intra-year valuation of its portfolio as at 30 June 2023 in the interests of creating additional transparency, the company made no further adjustments to the portfolio value as at the end of the quarter under review.

The addition of two large-scale retail properties in Hanau and Offenburg in July resulted in an increase in the total value of the portfolio to €1,542.2 million as at 30 September 2023 (31 December 2022: €1,608.6 million). Net asset value (NAV) per share declined by 9.3% as against the end of 2022 to €10.76.

OPERATING PERFORMANCE

The company also continued the positive business performance recorded in the first half of the year at an operational level. The full follow-on lease for the manage-to-core property in Mainz and several other successes in letting operations were already achieved during the year. These were followed by the early renewal of leases with the long-term tenant OBI at three DIY store locations as at the end of the third quarter. As a result, the letting result increased to around 90,000 m² as at 30 September 2023. This corresponds to growth of around 34% on the same period of the previous year.

The retention rate also improved to around 86% in the first nine months of the year, thereby demonstrating the continued high level of satisfaction among existing tenants.

The successes in letting operations are also reflected in other key portfolio figures. The average remaining lease term (WALT) remained very stable, coming in at 6.5 years as at the end of the third quarter. As a result of the early renewal of the leases at the OBI locations, the average term within the retail portfolio increased to 7.8 years.

Following a brief increase in the EPRA vacancy ratio as a result of the temporary vacancy of the property in Mainz due to structural conversion work, this figure fell to 2.7% as at the end of the third quarter.

OUTLOOK

Taking account of the positive operating performance in the first nine months, the company is confirming its revenue forecast for the full year 2023 and still expects to generate income from rents and leases of between €88.0 million and €89.0 million.

At the same time, on the basis of its current income and expenditure projections, the company is assuming slightly higher FFO compared to its most recently published forecast of between €53.0 million and €54.0 million (previously: €51.0 million to €53.0 million). The expected increase is due in particular to lower unplanned maintenance expenses in the current financial year and the postponement of maintenance and modernisation work until 2024.

Taking account of the external valuation of the property portfolio conducted as at 30 June 2023, the company still expects NAV per share to be between 7.0% and 12.0% lower than the previous year’s level as at 31 December 2023 (31 December 2022: €11.86). Against the backdrop of the market landscape, which remains dynamic despite uncertainty, the range of the forecast takes into account possible further value adjustments in conjunction with the regular external valuation of the portfolio at the end of 2023. Contrary to the assumption at the beginning of the year that further property transactions would take place in the second half of the year, no additional acquisitions or disposals in the remainder of the year were included in preparing the forecast.

KEY FINANCIAL AND PORTFOLIO FIGURES AS OF 30 SEPTEMBER 2023

The full financial statement for the third quarter of 2023 is available for download at https://www.hamborner.de/en/financial-reports/.

ABOUT HAMBORNER REIT AG

HAMBORNER REIT AG a public company listed in the SDAX that operates exclusively in the property sector and is positioned as a portfolio holder for high-yield commercial properties. The company generates sustainable rental income on the basis of a diversified portfolio of properties distributed throughout Germany with a total value of around €1.5 billion. The portfolio focuses on modern office properties at established locations as well as attractive local supply properties as large-scale retail assets, retail parks and DIY stores in central inner-city locations, district centres and highly frequented edge-of-town sites of major German cities and mid-sized centres.

HAMBORNER REIT AG is distinguished by its many years of experience on the property and capital market, its consistent and sustainably attractive dividend strategy and its lean and transparent corporate structure. The company is a registered real estate investment trust (REIT) and benefits from corporation and trade tax exemption at company level.

CONTACT

Christoph Heitmann
Head of Investor & Public Relations
Tel.: +49 (0)203 54405-32
Mail: info@ir.hamborner.de
Web: www.hamborner.de

DISCLAIMER

This press release has been issued by HAMBORNER REIT AG (hereinafter "HAMBORNER") solely for information purposes. This press release may contain statements, assumptions, opinions and predictions about the anticipated future development of HAMBORNER ("forward-looking statements") that reproduce various assumptions regarding, e.g., results derived from HAMBORNER's current business or from publicly available sources that have not been subject to an independent audit or in-depth evaluation by HAMBORNER and that may turn out to be incorrect at a later stage. All forward-looking statements express current expectations based on the current business plan and various other assumptions and therefore come with risks and uncertainties that are not insignificant. All forward-looking statements should therefore not be taken as a guarantee for future performance or results and, furthermore, do not necessarily constitute exact indicators that the forecast results will be achieved. All forward-looking statements relate solely to the day on which this press release was issued to its recipients. It is the responsibility of the recipients of this press release to conduct a more detailed analysis of the validity of forward-looking statements and the underlying assumptions. HAMBORNER accepts no responsibility for any direct or indirect damages or losses or subsequent damages or losses, as well as penalties that the recipients may incur by using the press release, its contents and, in particular, all forward-looking statements or in any other way, as far as this is legally permissible. HAMBORNER does not provide any guarantees or assurances (either explicitly or implicitly) in respect of the information contained in this press release. HAMBORNER is not obliged to update or correct the information, forward-looking statements or conclusions drawn in this press release or to include subsequent events or circumstances or to report inaccuracies that become known after the date of this press release.