DEMIRE Deutsche Mittelstand Real Estate (DMRE) Q4 2023 earnings summary

Executive summary

• Achieved successful bond restructuring, with formal approval for bond prolongation to end of 2027, providing financial stability and shareholder support.

• Annualised contractual rents as of June 2024 at €66.9m, down from €85.1m at end-2022, mainly due to asset disposals in Leipzig (LogPark) and Ulm.

• EPRA vacancy increased to 15.5% as of June 2024, with WALT at 4.3 years; majority of properties still benefit from indexation.

• Closed disposals of three assets in FY 2023 for over €70m; LogPark Leipzig sold in Q1 2024 for ~€103m.

• FY 2023 rental income at €78.5m (down 3% y-o-y); H1 2024 rental income at €35.5m (down 13%), both mainly due to disposals.

Financial highlights

• FY 2023 FFO after taxes, before minorities, at €36.7m (down 12% y-o-y); H1 2024 FFO at €15.5m (down 19.7%).

• FY 2023 EBIT at -€187.9m, impacted by negative fair value adjustments and impairments.

• H1 2024 EBIT at -€14.1m, with lower rental income and reduced revaluation losses compared to H1 2023.

• Cash position improved in H1 2024 to €167.1m, mainly from LogPark Leipzig sale.

• Net-LTV at 55.6% as of June 2024, down from 57.7% at end-2023; expected to fall to ~50% post-restructuring.

Outlook and guidance

• FY 2024 rental income expected between €64m–€66m, reflecting reduced portfolio size.

• FFO I (after taxes, before minorities) for FY 2024 anticipated to be significantly lower than FY 2023.