Deutsche EuroShop AG today looked back on the best financial year in its existence and disclosed the results for FY 2005 on its annual earnings press and analysts' conference in Hamburg.
Consolidated revenue up by 17.4%
Consolidated revenue was up by 17.4% from Euro 61.4 million to Euro 72.1 million in financial year 2005. This development is mainly attributable to the newly opened shopping centers. The Pécs Árkád in Hungary and the Phoenix-Center Hamburg were opened during 2004 and thus made a contribution to Group revenue during the whole of the year under review. Forum Wetzlar, which opened in February 2005, generated revenue for the first time.
Vacancy rate remained under 1%
As in the previous year, the vacancy rate was under 1%. The need for write-downs for rent losses was, at around Euro 0.2 million or 0.3% of revenue, at a level which impressively confirms the quality of center management.
Net finance costs increase due to investmentsNet finance costs increased by Euro 5.8 million to Euro -26.4 million. Firstly, interest income declined substantially by around Euro 0.4 million to Euro 2.2 million due to increased investment activity and the resulting reduction in cash funds. Secondly, interest expenses from the recognition of the borrowing costs for our newly opened properties rose by Euro 5.6 million to Euro 33.6 million. Income from investments was Euro 0.2 million above the previous years income because the Polish investee in Wroclaw distributed more income than in the preceding year.
Gains on measurements rose to Euro 49.9 millionGains on fair value adjustments rose year-on-year by Euro 41.9 million from Euro 8.0 million to Euro 49.9 million. The newly opened centers in Hamburg and Wetzlar were recognised at their market values for the first time. This made possible the recognition of measurement gains amounting to Euro 33.8 million. The revaluation of existing properties also led to materially higher Group income. These properties recorded increases in value of Euro 25.2 million. Only one German property was written down by Euro 6.6 million. The expenses of Euro 2.5 million associated with investment in these properties incurred in the year under review are deducted from this amount.
Profit increased by 76%
In the year under review, earnings before income and taxes (EBIT) increased by 15.6% from Euro 49.8 million to Euro 57.5 million, while EBT (profit before taxes) grew by 117.6% from Euro 37.3 million to Euro 81,1 million. After deducting income taxes amounting to Euro 19.3 million and other taxes amounting to Euro 0.1 million, consolidated net profit reached Euro 61.7 million (previous year: Euro 26.4 million). Of this, Euro 48.7 million (previous year: Euro 27.7 million) is attributable to Group shareholders. This comes up to an increase of 76%.
Earnings per share increased
Earnings per share (undiluted) amounted to Euro 3.09 compared with Euro 1.78 in the previous year. Of this amount, Euro 1.24 per share (2004: Euro 1.32) is attributable to operations (-6%) and Euro 1.85 (2004: Euro 0.46) to gains on measurements of financial instruments and properties (+302%). The reduction in operating profit is explained by the one-time disposal and exchange rate gains generated in the previous year.
Dividend proposal: Euro 2.00 per share
The Executive and Supervisory Boards will propose to the shareholders at the Annual General Meeting on 22 June 2006 in Hamburg that a tax-free dividend of Euro 2.00 per share be distributed for financial year 2005.
Net asset value rises
Based on the consolidated financial statements, the Groups net asset value as at 31 December 2005 was Euro 794.5 million (Euro 46.22 per share) compared with Euro 686.8 million (Euro 43.96 per share) in the previous year (+5%).
Revenue increase of 26 to 30% anticipated
Deutsche EuroShop anticipates revenue of between Euro 91 and Euro 94 million in financial year 2006 (2005: Euro 72.1 million).
Further improvement in EBIT and EBT pl