Direct investment result (cash profit) increased by 5.2%; per ordinary share by 2.6%. Prognosis for 2002: Direct investment result per ordinary share of approximately Euro 3.20 (2001: Euro 3.16).
In the first half of 2002, gross rental income increased to Euro 59.5 million. This is an increase of 11.4% compared to the same period in 2001 (Euro 53.4 million). This increase is the balance of sales in The Netherlands and expansion in Belgium. Operating expenses came to Euro 7.4 million (first half 2001: Euro 6.4 million), and came to 12.4% of gross rental income (first half 2001: 11.9%). This percentual increase was mainly due to provisions for letting expenses and for some doubtful debtors in Belgium.
Total interest expenses came to Euro 14.1 million (first half 2001: Euro 17.4 million). The direct investment result (cash profit) increased to Euro 29.0 million. This is an increase of 5.2% compared to the first half year of 2001 (Euro 27.6 million).
The direct investment result per ordinary share over the average number of ordinary shares issued came to Euro 1.60 (first half 2001: Euro 1.56).
The indirect investment result per ordinary share came to Euro 0,89 negative (first half 2001: Euro 0.06 positive) due to a write off of purchase costs in Belgium.
Developments in the property portfolio
In Belgium at the end of June 2002 an expansion of the property investment portfolio took place with the full acquisition of the bevak SIREF N.V., which was listed on Euronext Brussels. As a result, the Belgian subsidiary company Intervest Offices, listed on Euronext Brussels, acquired ownership of 18 logistics centres with a value of Euro 95.4 million. The Belgian property portfolio at present consists of approximately 70% offices and 30% logistics centres, and is well spread over the larger cities. After the transaction, VastNed Offices/Industrial now holds approximately 53% of the Intervest Offices shares. The other shares are mostly held by private investors, so that the free float of Intervest Offices has been expanded considerably due to the merger.
In France, where VastNed Offices/Industrial has logistics centres in Lomme, Meaux and Roissy, no changes took place.
The results of the appraisals of about half of the property portfolio showed a marginally positive revaluation for The Netherlands and a write down of Euro 12.8 million in Belgium, chiefly due to a write off of purchase costs.
The extension of tenancy agreements was satisfactory. Vacancy in the first half of the year amounted to 5.3% (first half 2001: 3.2% and 3.8% over 2001).
Holders of 70.6% of the ordinary shares exercised the option to take up the 2001 dividend partly in the form of stock dividend. In the previous year the figure was 54.0%. In the first half year, the number of shares issued increased by 489,246 shares to 18,437,541.
Group equity including current profits expressed as a percentage of the investments in property amounted to 45.2% as per June 30, 2002 (year-end 2001: 50.8%). In order to bring the balance sheet ratios to a more desired level, as well as to achieve a healthy circulation of the portfolio, in the second half of this year properties will be sold in The Netherlands.
Net asset value per ordinary share is Euro 29.21 as per June 30, 2002 (June 30, 2001: Euro 30.93).
Due to disappointing macro-economic results, expectations for a quick economic recovery are very modest worldwide. It is anticipated that this recovery will only set in in the course of 2003. This is set off by the fact that the expected interest increases will for the time being not be realised. In some quarters there is even speculation about new interest decreases. How all this will impact the market for offices, logistics centres and industrial premises remains as yet unclear.
Keeping this development in mind, and barring unforeseen circumstances, the previously announced expectation of at least an equal direct investment result per ordinary share for the full year 2002 is being raised to approximately Euro 3.20 (2