A strong first half of the year for Mobimo
- Following the extraordinary record results of the previous year, Mobimo has again posted a strong half-year performance in 2017.
- Mobimo generated profit of CHF 63.3 million (first half of 2016: CHF 89.8 million).
- Rental income of CHF 56.4 million (first half of 2016: CHF 56.8 million) was on a par with the previous year's figure.
- The vacancy rate remained at practically the same low level of 4.9%.
- Profit on sale of trading properties and development services was CHF 13.3 million (first half of 2016: CHF 17.0 million).
- Net income from revaluation of CHF 30.6 million (first half of 2016: CHF 20.9 million), which was mostly related to development properties, was substantially up year-on-year.
Lucerne, 4 August 2017 - After the record results of the previous year, Mobimo again posted pleasing half-year results in 2017, generating sound operating results in all areas. The company also registered net income from revaluation that was largely attributable to the realisation of development projects for its own investment portfolio. The numerous projects under construction and being planned are opening up a potential for further growth.
After financial years 2015 and 2016 had been shaped by extremely high income from the sale of investment properties and substantial market-related upward valuations of the portfolio, the focus in 2017 has reverted to the contribution made by operating results and development-driven added value. In the first half of 2017, Mobimo reported high EBIT of CHF 92.9 million (first half of 2016: CHF 105.2 million) and an excellent profit of CHF 63.3 million (first half of 2016: CHF 89.8 million) with successful activities in all operating areas. The profit attributable to the shareholders of Mobimo including revaluation totalled CHF 62.4 million (first half of 2016: CHF 89.5 million) and not including revaluation CHF 40.1 million (first half of 2016: CHF 74.2 million). This generated earnings per share of CHF 10.03 (first half of 2016: CHF 14.39) and CHF 6.46 per share excluding revaluation (first half of 2016: CHF 11.93). This indicates that Mobimo is on track to continue with its customary, attractive dividend policy.
Rental income on a par with the prior year thanks to low vacancy rate
Despite disposals and in view of a practically unchanged low vacancy rate of 4.9% (31 December 2016: 4.8%), rental income remained on a par with the prior-year level at CHF 56.4 million. The cost/income ratio arising from direct expenses for rented properties was once again slightly lower than in the previous year, coming in at 14% (first half of 2016: 15%). This resulted in net rental income of CHF 48.6 million (first half of 2017: CHF 48.3 million). Transaction-related movements in the portfolio as well as new business in the form of development properties completed for the portfolio once again mean that any comparison with prior-year periods is of limited relevance.
Continuous growth in rental income over the coming years
Thanks to its own property and facility management, Mobimo works in close proximity to tenants and can identify the changes and needs of customers at an early stage. This is one of the reasons why Mobimo has already been able to extend most of the contracts that expire in 2017 or conclude new ones.
Thanks to targeted portfolio diversification, Mobimo maintains a balanced usage mix. As at 30 June 2017, the share of rental income from residential usage was around 28%. Mobimo is currently realising, particularly in Zurich, Kriens, Aarau and Lausanne, projects for its own portfolio with a total investment volume of CHF 480 million. These will generate additional annual rental income in excess of CHF 25 million up to the end of 2019. Other development projects are also being planned for Mobimo's own portfolio with a total investment volume of some CHF 370 million and target rental income in excess of CHF 20 million.
Pleasing sales of condominiums in Aarau
Income from sale of trading properties and development services totalled CHF 91.2 million in the first half of 2017 (first half of 2016: CHF 59.7 million), which resulted in profit from trading properties and development services of CHF 13.3 million (first half of 2016: CHF 17.0 million). 74 condominiums were transferred to their new owners, with a large number of these situated in the Aarauer Aeschbachquartier, which was completed in spring 2017.
Mobimo will continue to invest in condominium projects where location, conditions and regional demand permit. After the reporting date, the company thus purchased a plot of land in Meggen on the shores of Lake Lucerne, where it plans to build around 30 condominiums. Development for Third Parties is realising a number of projects during the course of 2017 that will contribute to results in the second half of the year. The pipeline for third-party projects has a total investment volume of around CHF 800 million.
Taking advantage of opportunities using active portfolio management
Mobimo capitalised on continued high demand in the transaction market to sell three investment properties, once again optimising the portfolio and generating considerable profits. It disposed of the Apollo office building in Zurich, a business property in Renens and an apartment building in Versoix. These disposals produced net income of CHF 17.8 million (first half of 2016: CHF 33.9 million). In keeping with the company's business model, the sales proceeds will be invested in its own development pipeline in order to generate higher returns.
Revaluation income primarily from own developments
In the first half of 2017, Mobimo reported revaluation income of CHF 30.6 million (first half of 2016: CHF 20.9 million), of which CHF 23.8 million was attributable to the positive development in value of investment properties under construction. These include conversions or renovations of residential and office buildings in Rheinfelden, Aarau and Lausanne as well as, for example, the construction that is proceeding as planned on the Labitzke site in Zurich, where virtually all apartments have been rented out one year before its occupation. Construction work has been completed on Les Garages in Lausanne. This modular sales, business and office space in the Flon district that is to be occupied in September has already been let. The existing portfolio also provides further scope for value enhancement as a consequence of new developments or conversions. Thanks to having its own department, Mobimo can exploit this potential efficiently.
Switzerland is in robust economic condition. It offers attractive workplaces and a high quality of life. These parameters guarantee that demand for residential and business space - in particular in good city centre locations - continues unabated. Mobimo is confident that it is operating in an attractive market environment that provides an abundant source of opportunities. The changes under way in the retail sector, changing working methods brought about by digitalisation and constantly growing supply call for attentive observation of the market and flexibility. Thanks to its business model, Mobimo is in a position to pursue various options and operate successfully according to the market situation in question.
The company's focus remains unchanged as it enters into the second half of 2017. Mobimo aims to maintain its attractive dividend policy. The Board of Directors and Executive Board are confident that the company will continue to develop well in future, deliver excellent operational performances and create added value for its shareholders.
Detailed reporting: You can find the report on the first half-year 2017 on our website www.mobimo.ch.
A media and analysts' conference call will take place today at 10.00 a.m.
Christoph Caviezel (CEO) and Manuel Itten (CFO) will present the 2017 half-year results.
Dial-in data: +41 44 580 72 69 | Conference ID: 4568230
Please use the following link to view a live broadcast of the presentation being used in the teleconference: http://mobimo040817-live.audio-webcast.com
A conference call in English will be held today at 2 p.m.: Following the presentation of the half-year results, Manuel Itten (CFO) will be available to answer any questions.
Dial-in data: +41 44 580 10 22 / Conference ID: 9006571
The corresponding presentation can be viewed by clicking the following link:
www.audio-webcast.com (password: mobimo0817en)
If you have any questions, please contact:
Mobimo Holding AG
Dr. Christoph Caviezel, CEO
Manuel Itten, CFO
+41 44 397 11 86
Mobimo Holding AG was established in Lucerne in 1999 and has been listed on the SIX Swiss Exchange since 2005. With a real estate portfolio with a total value of more than CHF 2.7 billion, the Group is one of the leading real estate companies in Switzerland. The portfolio comprises investment and development properties in first-class locations in German-speaking Switzerland and French-speaking Switzerland. Mobimo generates stable rental income with its residential and commercial properties, while its development expertise and full pipeline allows it to create value enhancement potential in its own portfolio and for third parties. The investment volume of development properties for its own portfolio totals around CHF 0.8 billion. Mobimo has a stable business model, pursues a sustainable strategy and provides its shareholders with an attractive return.