S IMMO AG posts strong Q3 results, driven by strategic investments and operational Ggowth

S IMMO AG has reported a robust financial and operational performance for the first three quarters of 2024, reflecting the company’s strategic investments and continued portfolio optimization.

“These results clearly demonstrate our strong operating performance and the benefits of our prudent investment strategy over recent months,” said Radka Doehring, a member of the Management Board. “We have achieved significant increases in total revenues, rental income, and gross profit, which are well above last year’s levels.”

The company recorded a 36% increase in total revenues, reaching €280.3 million, while rental income surged by 46% to €167.7 million. Gross profit rose by 48% to €162.6 million, and EBITDA jumped 57% to €134.6 million. Net income for the period stood at €29.8 million, with earnings per share at €0.40.

Strategic Sales and Portfolio Realignment

Key developments include the completion of the sale of Hotel Juliš in Prague, which boasts a gross leasable area of 6,700 square meters. This sale aligns with S IMMO’s broader strategy of portfolio optimization, which has included property sales in Germany, Austria, the Czech Republic, Hungary, and Slovakia.

Additionally, a significant milestone was achieved on 14 October 2024, when the shareholders approved a squeeze-out of minority shareholders under the Austrian Squeeze-out Act. The registration of this action is expected in December 2024, pending court approval.

Operational Highlights and Financial Strength

S IMMO attributes its improved revenue performance to acquisitions of high-income-generating properties in Austria and the Czech Republic in 2023 and 2024, coupled with strong like-for-like growth. Rental income climbed sharply to €167.7 million, a 46% year-on-year increase, while gross profit improved to €162.6 million, up 48%. Revenues from operating costs also rose significantly, contributing to the company’s overall financial strength.

While property expenses increased to €80.5 million, reflecting higher operational and maintenance costs, EBITDA saw substantial growth, rising to €134.6 million, compared to €86 million in the same period last year.

Valuation Gains and Improved Equity Metrics

The company reported a positive property valuation result of €2.1 million, compared to a negative €17.7 million in Q3 2023. Equity increased slightly to €1.65 billion, and EPRA NRV per share stood at €28.08. The equity ratio improved to 41.8% by the end of Q3 2024, up from 40.7% at the close of 2023.

Outlook and Continued Growth

S IMMO continues to focus on its strategic withdrawal from the German market, with properties meeting IFRS 5 criteria being classified as assets held for sale. This aligns with the company’s broader strategy to streamline operations and maximize value through active asset rotation.

“These figures are a testament to the effectiveness of our strategy,” said Tomáš Salajka, a member of the Management Board. “Our active asset rotation creates a solid foundation for future earnings.”

With total assets of €4.03 billion as of 30 September 2024, and cash reserves of €273.2 million, S IMMO is well-positioned for continued growth. The company’s strong operational and financial performance underscores its resilience and ability to adapt to market opportunities.