DEFAMA Deutsche Fachmarkt (DEF) Q3 2024 earnings summary

Executive summary

• Revenue for the first nine months of 2024 rose to €19.9M, up from €16.9M year-over-year, with net income at €3.9M versus €2.8M.

• Growth driven by 13 property acquisitions, successful leasing activities, and a €1.5M one-time gain from the sale of the Büdelsdorf retail center.

• Portfolio expanded from 68 to 77 properties, with a 96% occupancy rate and annualized net rents of €26.5M.

• Focus on acquiring established retail centers with strong anchor tenants and low vacancy, mainly in small to mid-sized cities, following a buy-and-hold strategy for sustainable double-digit equity returns.

• Achieved a significant property sale with a €1.5M positive one-time effect.

Financial highlights

• EBITDA increased to €13.6M from €10.8M; EBIT reached €8.7M, up from €6.5M year-over-year.

• Funds From Operations (FFO) rose 7% to €7.6M, or €1.59 per share.

• Net Asset Value (NAV) per share climbed to €24.80 from €23.79, despite a €0.57 dividend payout.

• Portfolio value grew 6% to €288M as of September 30, 2024.

• Loan-to-value (LTV) ratio at 58% with average interest rate 2.16%–2.89% and average maturity 6.1–7.2 years.

Outlook and guidance

• 2024 forecast: net income (HGB) €4.8M (including €1.1M from sales), FFO €10.3M, annualized FFO €12.3M, dividend >€0.57 per share.

• Dividend increase for 2024 confirmed; further portfolio growth and new acquisitions anticipated.

• Mid-term plan targets €350M portfolio value, €28M annualized rents, and at least €13M FFO (>€2.70/share) before end of 2025.

• Ten new property acquisitions expected to drive a profit jump in Q1 2025.

• Continued growth strategy with further acquisitions and selective sales; new long-term targets to be published in December.