VIB Vermögen continues profitable growth course and plans a further dividend increase
- Revenue increases by 3.9 per cent to EUR 86.8 million
- Adjusted earnings before tax (EBT) rise sharply by 9.9 per cent to EUR 51.7 million
- Dividend set to increase for the tenth time in a row, with a proposed dividend of EUR 0.65 per share
- Continued growth in revenue and earnings expected for 2019
VIB Vermögen AG, a company specialising in the development, acquisition and portfolio management of commercial properties, closed its 25th anniversary year with another record result. Interim IFRS figures for the Group indicate that revenue increased by 3.9 per cent to EUR 86.8 million (previous year: EUR 83.6 million) in the 2018 financial year. This rise was chiefly driven by additional rental income from properties completed in the 2018 financial year. Furthermore, the properties handed over to tenants during the 2017 financial year made a significant revenue contribution, generating a full year’s rental income for the first time.
Positive changes in value for investment properties amounted to EUR 19.5 million in the year under review (previous year: EUR 17.4 million). Expenses for investment properties climbed to EUR 15.0 million (previous year: EUR 13.8 million). Personnel expenses at the Group rose slightly from EUR 3.6 million to EUR 3.7 million. Other operating expenses remained stable at EUR 1.8 million (previous year: EUR 1.8 million).
Sharp climb in earnings
Thanks to the continued favourable financing conditions, the interest expense fell by almost EUR 2 million to EUR 15.6 million (previous year: EUR 17.4 million). When adjusted for valuation effects, earnings before tax rose sharply by 9.9 per cent to EUR 51.7 million (previous year: EUR 47.1 million). Consolidated net income improved accordingly, coming in at EUR 59.9 million in 2018 (previous year: EUR 53.9 million). This equates to an increase of 11 per cent. Given the 27.6 million shares, it also corresponds to earnings per share of EUR 2.09 (previous year: EUR 1.87).
As of December 31, 2018, equity stood at EUR 527.6 million, which was EUR 44.2 million higher than the prior-year date (31/12/2017: EUR 483.4 million). The equity ratio rose again and now stands at 42.7 per cent (31/12/2017: 41.9 per cent).
"VIB Vermögen celebrated its 25th anniversary in the 2018 financial year. It is therefore fitting that we have posted yet another excellent result. These figures provide further endorsement of our strategy of sustainable and targeted growth on the basis of a flexible business model," remarks Martin Pfandzelter, Chief Executive Officer of VIB Vermögen AG. "With our high-quality portfolio of existing properties and an attractive pipeline for future projects, we believe that we are well positioned in a demanding market environment," adds Pfandzelter.
Further improvement in key property portfolio figures
The VIB Vermögen portfolio comprised 108 properties at year end (previous year: 105). The net asset value (NAV) of the company rose to EUR 560.0 million as of December 31, 2018 (31/12/2017: EUR 512.5 million). Given the number of outstanding shares, it increased by 9.2 per cent to EUR 20.30 per share (31/12/2017: EUR 18.58 per share). Funds from operations (FFO), as an indicator of the company’s operating cash inflow, improved considerably in the year under review, rising by 10 per cent to EUR 1.64 per share, compared with EUR 1.49 per share in the previous year.
Further dividend increase planned
The Managing and Supervisory Boards of VIB Vermögen will once again propose a dividend increase to the Annual General Meeting. The intention is to increase the dividend by EUR 0.05, or 8.3 per cent, to EUR 0.65 per share (previous year: EUR 0.60 per share).
"VIB is benefiting from the expansion of its portfolio and a continued favourable financing environment. This is reflected directly in our funds from operations and our earnings figures. We are also enabling our shareholders to benefit, which is why the Managing and Supervisory Boards will be proposing a dividend increase to the Annual General Meeting for the tenth time in a row," explains Holger Pilgenröther, CFO of VIB Vermögen.
In-house developments driving growth in 2019
Multiple large-scale in-house developments at VIB Vermögen will lead to growth in rentable space as well as rising rental income in 2019.
The Managing Board of VIB Vermögen anticipates a further increase in revenue and profitability for the current financial year. Revenue of between EUR 88.5 million and EUR 92.5 million is expected. Excluding valuation effects and extraordinary items, EBT is expected to reach a level between EUR 52.0 million and EUR 54.5 million. FFO (funds from operating activities) is expected to rise to between EUR 45.5 million and EUR 48.0 million in the 2019 financial year.
The company will publish its final results for the 2018 financial year together with the 2018 Annual Report on April 30, 2019. A company presentation with details of the 2018 interim results can be found at www.vib-ag.de.