Strong revenue and earnings growth at VIB Vermögen AG
One of the steadiest performers over the last few years in Germany’s listed property sector has been VIB Vermögen AG, based in Neuburg an der Donau (“Newcastle on the Danube”), near Ingolstadt in Bavaria. The company specialises in commercial real estate in southern Germany, and recently reached the milestone of 100 assets in its portfolio, encompassing shopping centres, office buildings, production facilities and logistics plants.
The company ended its 2013 fiscal year with record revenue and earnings, with turnover up 8.6% from €59.8m to €65.0m – primarily due to the expansion of the portfolio, and an accounting amendment which allowed the recognition of rental revenue from properties acquired halfway through the year. Upward revaluations of a number of assets also helped the improved figures.
Ludwig Schlosser, CEO of VIB Vermögen, commented, “In our twentieth anniversary year, we have continued to focus on commercial properties in the logistics growth sectors and in the retail sector. In addition, we enter into mostly long-term rental agreements with tenants of high credit standing. This boosts the planning security of our business. We enjoy a very high rental ratio of 98.1 % as a consequence.”
Investors continue to support the company’s understated growth story in Germany’s prosperous southern states, and have been well rewarded over the past five years. Among factors attracting investors are the widely-diversified portfolio, average rental yields of about 7.5%, equity ratio of about 37% and steadily rising FFO which generates decent dividends.
Chief financial officer Holger Pilgenröther also gave a positive outlook for prospects in a recent statement: “For 2014, we are assuming further income growth and higher profitability. Before valuation effects, we anticipate total operating revenue of between €69.0 million and €72.0 million, EBIT of between €50.5 million and €52.0 million, EBT of between €29.0 million and €30.5 million. We want our shareholders to participate in last year's successful corporate growth, which is why we are proposing to the 2014 AGM that it distributes a dividend of €0.45 per share, up 12.5 % compared with the previous year.”