2020

16.03.2020 – HIAG Immobilien Holding AG

HIAG's fiscal year 2019 marked by extraordinary incidents

Media Release

HIAG's fiscal year 2019 marked by extraordinary incidents

CHF 70.7 million loss due to Rohner bankruptcy and restructuring of HIAG Data

Focus on the successful core business of real estate development

Property income increased by 8.2% to CHF 63.0 million

Real estate portfolio further expanded to CHF 1.57 billion

Comfortable, average remaining rental period (WALT) of 8.9 years

Proposal to forego dividend for fiscal 2019

Basel, 16 March 2020 – The fiscal year 2019 confronted HIAG with major challenges. While the core business of real estate development performed well and real estate income increased again, the Group had to cope with two major setbacks: first, the exit from the project to develop its own multicloud platform and the restructuring of HIAG Data, and second, the bankruptcy of Rohner AG, Pratteln, the third largest tenant at that time. Due to the substantial impact of these two events, the Board of Directors will propose to the Annual General Meeting on 23 April 2020 that no dividend is paid.

As a result of the two one-off events in fiscal year 2019, HIAG posted a loss of CHF 70.7 million in the year under review, following a profit of CHF 60.9 million in the previous year. On the one hand, the discontinuation of the development of its own multicloud platform had a negative impact on the result of around CHF 70 million. All assets in connection with this project were 100% impaired as of 31 December 2019, and HIAG is currently assuming that extraordinary income can be generated within the scope of the monetisation of the existing assets. In addition, following the bankruptcy of the tenant Rohner AG, Pratteln, HIAG has to cover the costs for the deconstruction and restoration of the site to a chemical-free condition. This had a total negative impact on the 2019 result of CHF 51.3 million: CHF 18.5 million of this amount is attributable to a lower real estate valuation after tax effects and provisions of around CHF 30 million for the dismantling of the production infrastructure at the site and the redevelopment of the site into a chemical-free condition. In addition, there are operating costs of around CHF 2.8 million in the year under review, as minimum operations must be maintained until the dismantling is completed.

Robust real estate business

In fiscal year 2019, HIAG increased its collected property income by 8.2% to CHF 63.0 million (2018: CHF 58.2 million) compared with the previous year. Thanks to the successful completion of various redevelopment projects, annualised rental income declined only slightly by 2.5% to CHF 59.4 million (2018: CHF 60.9 million) despite the bankruptcy of Rohner AG, Pratteln, and the move of a major tenant in Dietikon. The vacancy rate rose to 16.2% (2018: 14.3%) due mainly to the initial vacancies in three completed projects and the effect of the departure in Dietikon. Nevertheless, HIAG still has a comfortable weighted average remaining lease term (WALT) of 8.9 years (2018: 9.7 years). At the end of December 2019, the total portfolio consisted of 116 properties. The value increased by 5.4% to CHF 1.57 billion (31.12.2018: 1.49 billion). The fact that the revaluation of property effects were negative at CHF -16.8 million (31.12.2018: CHF 76.4 million) is mainly due to the impact of CHF -20.4 million from the bankruptcy of Rohner AG, Pratteln. The weighted average discount rate for the entire portfolio decreased slightly and amounted to 3.94% as of December 31, 2019 (December 31, 2018: 4.15%).

Solid financial structure

As at 31 December 2019, HIAG Immobilien Holding AG had an equity ratio on an EPRA basis of 45.6% (31.12.2018: 54.2%). Following the successful placement of a fixed-interest bond for CHF 150 million with a term of 5 years, the weighted average term of debt capital was stable at 2.7 years as of 31 December 2019 (31.12.2018: 2.8 years). The average interest rate for financial liabilities remains low at 0.9% (31.12.2018: 0.9%). The loan-to-value ratio (LTV) was 51.4% (31.12.2018: 43.4%).

Attractive real estate portfolio

As of 31 December 2019, HIAG's redevelopment portfolio consisted of 56 projects with approx. 707,000 sqm of usable space. The expected investment volume for the next ten years, excluding further acquisitions, is approximately CHF 1.9 billion. Six of these projects are currently under construction, with an annualised property income after completion and full occupancy of approximately CHF 4.6 million. Over the next three years, HIAG can tackle a further ten development projects with a usable space of approximately 107,000 sqm , necessary investments of approximately CHF 250 million and an annualised property income potential after completion and full occupancy of approximately CHF 21 million.

Proposal to waive dividend

As already announced as part of the half-year report, the Board of Directors will propose to the Annual General Meeting of HIAG Immobilien Holding AG on 23 April 2020 to waive the distribution of a dividend due to the extraordinary incidents in fiscal year 2019.

Outlook

HIAG expects to increase the annualised property income in fiscal year 2020 with the completion of further development projects, assuming stable development of the Swiss real estate market, despite the fact that the collected property income is likely to be lower following the bankruptcy of Rohner AG, Pratteln. For the duration of the dismantling of the production infrastructure at the site Pratteln, HIAG expects annual net operating costs of up to CHF 5 million. Potential proceeds from asset sales of the former chemical company are expected for fiscal year 2021. HIAG then anticipates that HIAG Data will affect the result in fiscal year 2020 with ongoing operating costs of around CHF 5 million. These costs will be offset by potential income from the use of infrastructure in the context of the cooperation with Beelastic AG and the Tarchini Group. In addition, network infrastructure costs will no longer be incurred in future, as Beelastic AG will take over the network infrastructure and network customers of HIAG Data as part of the cooperation. With a strong anchor shareholder, an experienced management and an attractive real estate and redevelopment portfolio, HIAG sees itself well positioned for long-term growth through its own efforts and for targeted optimization of its extensive 'Land Bank' through acquisitions.

Selected HIAG key figures

Fiscal year

2019

2018

Property income

CHF million

63.0

58.2

Annualised property income

CHF million

59.4

60.9

Revaluation of properties

CHF million

-16.8

76.4

Earnings before interest, taxes, depreciation and amortisation (EBITDA)

CHF million

-38.4

104.3

Earnings before taxes (EBT)

CHF million

-86.5

70.3

Net loss/ income of the period

CHF million

-70.7

60.9

Adjusted EPRA Earnings(1)

CHF million

0.6

34.2

Closing date

31.12.2019

31.12.2018

Cash and cash equivalents

CHF million

23.9

34.5

Real estate portfolio

CHF million

1,572

1,488.2

Shareholders' equity (NAV)

CHF million

672.1

784.9

Equity ratio

%

41.3

49.1

EPRA Equity ratio

%

45.6

54.2

LTV Ratio

%

51.4

43.4

Balance sheet total

CHF million

1,628.6

1,598.9

Fiscal year

2019

2018

Cash flow from operating activities incl. sale of promotion

CHF million

15.2

40.1

Vacancy rate

%

16.2

14.3

Weighted average remaining lease term

Years

8.9

9.7

Earnings per share (EPS)

CHF

-8.85

7.60

Number of shares used to calculate earnings per share

Shares

7,996,265

8,023,893

Pay out per share(2)

CHF

0

3.90

NAV per outstanding share before deferred taxes

CHF

92.60

108.55

NAV per outstanding share after deferred taxes

CHF

84.01

98.18

Number of shares used to calculate NAV per share

Shares

8,000,085

7,994,062

(1) EPRA Earnings adjusted for the contribution HIAG Data and for the contribution Jaeger et Bosshard SA

(2) For the 2019 financial year, the Board of Directors will propose at the Annual General Meeting on 23 April 2020 that no dividend be paid.

Annual Report 2019

HIAG’s 2019 Annual Report is available online at www.annualreport.hiag.comand the presentation slides are available at www.hiag.com.

Media conference

On Monday, 16 March 2020, 9.00 a.m. Marco Feusi, CEO, and Laurent Spindler, CFO, will explain fiscal year 2019 in a media conference. In view of the more stringent measures to protect against COVID-19, the annual media conference will be held online only. The presentation at Au Premier in Zurich Main Station is cancelled.

The presentation is available live and as a recording under the following link: https://78449.choruscall.com/dataconf/productusers/hiag/mediaframe/30200/indexl.html

Annual General Meeting

The Annual General Meeting of HIAG Immobilien Holding AG will take place on Thursday, 23 April 2020, 10:00 a.m. (doors open at 9:00 a.m.) in the Samsung Hall in Zürich-Stettbach. The invitation will be sent to shareholders entitled to vote by postal mail and will be published in the Swiss Official Gazette of Commerce (SOGC) and on www.hiag.com.

Financial calendar

23 April 2020

Annual General Meeting

31 August 2020

Publication of half-year results 2020

Contacts

Marco Feusi

Chief Executive Officer

T +41 61 606 55 00

marco.feusi@hiag.com

Laurent Spindler

Chief Financial Officer

T +41 61 606 55 00

laurent.spindler@hiag.com

HIAG Immobilien Holding AG

Aeschenplatz 7

4052 Basel

T +41 61 606 55 00

investor.relations@hiag.com

www.hiag.com


fermer