PATRIZIA Immobilien AG continued its positive business development in the second quarter of 2010.
In residential property resales, 177 residential units were sold in individual transactions to tenants, owner-occupiers and private investors during the reporting period. This represents an increase of 20.4 % compared with the same quarter of the previous year. In total, the number of apartments resold in the first half of the year rose by 40 % to 360 residential units (first half of 2009: 257). In the field of asset repositioning, two block sales with 297 units were realized in the second quarter of 2010. PATRIZIA thus sold 657 residential units in total in the first half of 2010 (first half of 2009: 257), representing an increase of 156 %.
Consolidated revenues increased by 107 % as against the second quarter of 2009 to 98.3 million. In comparison with the first half of 2009, they increased by 65.4 % to 153.1 million. In addition to the improved sales figures, revenues from services also saw pleasing development thanks to the expansion of the fund business.
The considerable rise in revenues in the services segment, from 1.8 million in the first quarter to 3.8 million currently, is mainly attributable to purchasing commissions received for the properties acquired for the funds. Rental revenues were reduced further, owing to the decline in the real estate portfolio as a result of successful sales, and amounted to 16.1 million (second quarter of 2009: 17.7 million). Although apartments let at higher prices were sold in the last few months, the average rent per square meter remained constant throughout the portfolio and came to 7.73/m²/ month as at June 30, 2010 (March 31, 2010: 7.72/m²).
Earnings before interest and tax (EBIT in accordance with IFRS) in the reporting period exceeded the previous year's level by almost 9.0 million, improving to 29.3 million an increase of 44.0 % (first half of 2009: 20.4 million). Pure interest expenses for bank liabilities plus expenses for interest hedges amounted to 24.3 million in the first half of 2010 and were thus considerably reduced compared with the same period of the previous year (27.6 million). This means rental income for the first six months (32.8 million) exceeds the adjusted financing result by 35.0 %.
The financing result is influenced to a large extent by the effects of the market valuation of interest rate hedges. In the first half of 2010, the financing result was burdened by fair value changes in the amount of -10.6 million (second quarter of 2010: - 3.4 million). As these changes in the fair value of interest rate hedges do not impact liquidity and have no effect on operating earnings power, PATRIZIA posts operating earnings adjusted for these effects.
According to this, PATRIZIA recorded operating pre-tax earnings of 5.0 million in the first half of 2010, of which 2.9 million was attributable to the second quarter.
Compared with the operating pre-tax earnings for the first half of 2009 (- 7.2 million) and the corresponding quarter of the previous year (-2.5 million), PATRIZIA has achieved a substantial improvement.
Wolfgang Egger, CEO of PATRIZIA Immobilien AG, says: "We expect business to continue to grow. That applies both to our sales activities and to our service business. From our current perspective, we expect to achieve operating earnings of 10 million in 2010."
Egger justifies his confidence by pointing out that residential property resales have since the end of the reporting period remained at the high level seen so far this year and that further block sales including a total of 269 units have been registered.
Moreover, three projects in the Project Development segment are to be completed in the second half of the year and will be recognized in income in the 2010 fiscal year.
"In addition to purchases of properties for our funds, we now also want to acquire properties for our resale portfolio and project development again," Egger says.
"If conditions are appropriate, initial investments may b