Leading independent property company Wereldhave has released its results for 2008.
- Higher direct result per share
- Lower profit due to negative revaluations
- Optional dividend of 4.65 per share
The profit for 2008 including minority interest - amounted to 8.8 million (2007: 229.6 million). The profit decreased due to a downward revaluation of the portfolio and due to lower profits on disposals than in 2007. The revaluation of the portfolio was negative in all countries, with the exception of Belgium and Finland. The value of the portfolio decreased by in total 112.6 million. The surplus on disposals amounted to 4.3 mln, mainly caused by property disposals. Profit per share, net of minority interests, amounted to 0.02 per share (2007: 10.42).
The direct result for 2008 (including minority interest) amounted to 109.4 million and is thus 1.4 million higher than in 2007. The increase was (including exchange rate differences) the result of higher net rental income (1.1 million), lower interest expenses (2.3 million) and lower other income and expenses (- 1.7 million). Lower average exchange rates of the British Pound and the US dollar had a negative effect of 2.5 million in total.
The decrease in interest expenses was due to lower interest rates, in particular in the United States. Lower interest rates are advantageous to Wereldhave because approximately 75% of its loans have been financed at variable interest rate. The average interest rate at year-end 2008 stood at 3.7% (2007: 5.4%). As a result of a non-recurring gain in 2007 in connection with the buying out of a lease, other income and expenses decreased in 2008 by 1.7 million.
The occupancy rate increased compared to 2007 to 94.7% (2007: 94%). By sector, occupancy rates during 2008 were as follows: offices 90.9%, retail 98.6%, industrial 97.2% and residential 92.1%.
The indirect result for 2008 (including minority interest) amounted to - 100.6 million (2007: 121.6 million). The average yield on the portfolio used in the valuation increased by approximately 0.3% in 2008, whereby the weighted net initial yield of the portfolio amounted to approximately 6.2%. The rise in the initial yields has resulted in a negative revaluation of the property portfolio as at 31 December 2008. The negative effect of the increase in the yield (174.7 mln) was partially set off by a valuation effect of higher rents and by other effects (62.1 mln), resulting in a negative revaluation of property of - 112.6 million. The revaluation of financial instruments (interest derivatives) amounted to 4.7 million.
The surplus on disposals amounted to in total 4.3 million in 2008 (2007: 17.4 million). Lower property valuations resulted in a decrease in deferred taxes on the indirect result by 10.0 million (2007: - 22.6 million). Other financial income and expense increased to - 5.9 million (2007: - 0.5 million). This comprises exchange rate differences and higher pension costs due to an extra payment to the pension fund. Equity The balance sheet total rose by 20.1 million. An increase from the acquisition of the San Diego office building was offset by lower valuations and exchange rate effects. At the end of 2008, equity including minority interests before appropriation of the proposed dividend amounted to 1,860.2 million. This represents 65.9% of the balance sheet total (2007: 70.4%). No new shares were issued during 2008 and no convertible bonds opted for conversion. As at 31 December 2008, a total of 20,781,735 ordinary shares were in issue. The net asset value per share before profit appropriation as at 31 December 2008 was 83.74 (2007: 89.06).
During 2008, Wereldhave purchased an office building in San Diego in the United States for USD 161 mln. Two industrial buildings in the United Kingdom and a parcel of land and a parking facility in the Netherlands were sold. The average occupancy rate for 2008 rose to 94.7% (2007: 94%).