Growing successfully with continuity and innovation Company - - PowerPoint PPT Presentation

FCR Immobilien AG

Growing successfully with continuity and innovation

Company presentation February 2020

2

Business model | Positioning

FCR AG – one of the leading real estate investors in Germany

Persuasive, innovative business model

FCR Immobilien AG is a dynamically growing real estate investor

• perating nationwide.

Falk Raudies Founder and CEO Professor Dr Franz-Joseph Busse Chairman of the Supervisory Board Professor Dr Kurt Faltlhauser Deputy Chairman of the Supervisory Board Frank Fleschenberg Supervisory Board

Positioning as a commercial real estate specialist with a primary focus

• n shopping centres and retail parks at secondary locations

Covering the entire value-creation chain (acquisition, active asset management, divestment) Rental income from highly profitable portfolio properties and from property sales Stability and security through solid financing and substantial hidden reserves in the real estate portfolio Continuing development of the business model focusing on potentials and earnings based on technical innovations FCR Immobilien AG FCR Verwaltungs GmbH FCR Service GmbH FCR Innovation GmbH 81 property management companies

• Registered office in Munich
• 30 employees
• AG (stock corporation) since 2014

Portfolio holder Portfolio developer Seller Limited partnership shares ➢ Highly efficient, slim group/organisational structure; scale effects can be realised to a significant extent

Clear profile focused on growth Efficient corporate structure Experienced management team

3

Business model | Positioning

With clear guidelines for sustainable success

Primary focus on commercial real estate (shopping centres, supermarkets, retail parks) Anchor tenants with good credit ratings (fast-moving consumer goods) are an imperative; hardly any cannibalising effects from

• nline business

FCR’s investment strategy focuses on short residual terms, added value and special circumstances Properties are always initially acquired with FCR equity (fast time-to-market) Acquisition volumes between € 1 and 25 million,

• r up to € 100 million for

very promising

• pportunities

Development and expansion of tenancy agreements with tenants from the same group of companies (synergy effects) Intensive due diligence combined with a detailed plan for the use of the acquired property Non-recourse financing (variable) for key components following acquisition Focus on individual real estate properties and portfolios in established micro-locations with high initial returns (> 10%) Established professional player in a predominantly semi-professional environment Key value creation by reducing vacancies and long-term tenancy extensions Sale of properties after exploiting their appreciation potential (growth financing)

FCR’s Basic Strategy

Consistent acquisition management Top brands as solvent tenants Value creation through strong tenancy management Financing as business driver

4

Market environment

Over-the-counter retail is still stronger than e-commerce

Turnover development of German retail trade (in € billion) Development of online turnover in Germany (in € billion)

Source: HAHN Retail Real Estate Report 2019/2020 | https://www.hahnag.de/hahn-gruppe/downloads

▪ At €8.4 billion in absolute growth, over-the-counter retail outperformed e-commerce (€4.4 billion) ▪ Online retail growth rates continue to decline (2016: 10.8%, 2017: 10.6%, 2018: 9.0%) ▪ Online share in non-food retail is 14.9%, in contrast, only 1.0% in food retail

Excludes automotive trade, petrol stations, fuels and pharmacies *2019: Forecast Legend: bar -> turnover | yellow line -> nominal change to preceding years in percent Source: German Federal Statistical Office, HDE

5

Strategy

Expansion of market position through market penetration and development

Consistent market penetration (Development of market position)

FCR growth strategies Markets Germany Commerce

Selective, profit-oriented market development (development of business model)

Commerce Hotels Residential Office

Asset classes

+

Germany Austria Italy Spain Continuous business development based on existing success factors: First-rate know-how – long-term experience – broad network

FCR’s Basic Strategy

Logistics

Real Estate portfolio

Commercial real estate in Germany is the core of FCR

6

FCR is represented in Germany in all federal states with properties. Top 3 are currently: Lower Saxony, Baden- Württemberg and NRW.

Portfolio structure | Last updated: 31/10/2019 | Basis: annualised actual net rental income

With a share of approx. 84%, the asset class “Retail” is still the undisputed leader in the FCR portfolio. FCR generates over 95% of its earnings in the German market.

18,4% 16,3%15,9% 12,9% 8,9%7,8%6,9% 2,3%2,2%2,2%1,2% 0,3%

Lower Saxony Baden-Württemberg North-Rhine-… Thuringia Saxony-Anhalt Saxony Brandenburg Schleswig-Holstein Bavaria Rhineland-Palatinate Mecklenburg Berlin 83,8% 7,4% 3,9% 3,6% 1,3%

95,3% 4,7% Germany is FCR’s core market. In selective cases, FCR also acquires properties in other European countries. Outside Germany: Austria, Italy, Spain

7

11 12 18 41

58

81

20 40 60 80 100

2014 2015 2016 2017 2018 2019e

Number of properties

Key portfolio indicators 2014 – 2019e

Actual net rents are around €20 million

48 51 83 140

248

348

100 200 300 400

2014 2015 2016 2017 2018 2019e

Leasable space (in 000 m²)

1,1 3,2 5,5 9,5

14,8

19,8

10 20 30

2014 2015 2016 2017 2018 2019e

Actual net rental income

(p.a., in € million)

1,2 3,9 6,3 10,9

17,7

22,6

10 20

2014 2015 2016 2017 2018 2019e

Potential net rentals

(p.a., in € million)

Market value of portfolio

2019e: €298 million

2014 – 2019e:

• Acquired properties: 105
• Sold properties: 24

2019e:

• Acquired properties: 28
• Sold properties: 5

Actual net rental return p.a.

2019e: 9.2%

Potential net rental return p.a.

2019e: 10.5%

WAULT

2019e: 4.5 years

YOY

(2018- 2019e)

+ 40%

YOY

(2018- 2019e)

+ 40%

YOY

(2018- 2019e)

+ 34%

YOY

(2018- 2019e)

+ 28%

8

Key financial indicators 2014 – 2019e

Profitable, fast-growing - and that for years

2014-2018: audited consolidated annual financial statements

3,3 12,7 12,1 16,4

37,2

46,2

0,0 20,0 40,0 60,0

2014 2015 2016 2017 2018 2019e

Turnover (in € million)

1,5 3,7 3,1 4,9

10,1

17,6

5 10 15 20

2014 2015 2016 2017 2018 2019e

EBITDA (in € million)

1,1 3,0 2,3 3,7

7,4

12,3

5 10 15

2014 2015 2016 2017 2018 2019e

EBIT (in € million)

0,8 1,9 0,8 1,3

3,0

6,7

2 4 6 8

2014 2015 2016 2017 2018 2019e

EBT (in € million)

YOY

(2018- 2019e)

+ 24%

YOY

(2018- 2019e)

+ 74%

YOY

(2018- 2019e)

+ 66%

YOY

(2018- 2019e)

+ 123% Financial Calendar: Publication of preliminary figures for the 2019 financial year on February 19, 2020 with conference call Press release 01/2020: ▪ Former C&A building sold ▪ 7 properties sold in 2019 ▪ Earnings contribution of over €12 million

9

Key financial indicators 2016 – 2019e

Significant growth in all key figures compared to 2018

1,3 2,1

4,1

9,6

0,16 0,26 0,49 1,00

2 4 6 8 10 12

2016 2017 2018 2019e

FFO 2

(including revenues from sales, in € million)

FFOPS (in €) * 2016-2018: audited consolidated annual financial statements FFOPS: share split adjusted

EPRA-NAV (in € million)

▪ Paid-up registered share capital: 9.146.404,00 Euro ▪ EPRA-NAV: 97,5 Mio. Euro ▪ EPRA-NAV/share: 10,66 Euro

FFOPS (in €) FFOPS (in €) FFOPS (in €)

YOY

(2018- 2019e)

+ 134%

26,7 50,2

75,3

97,5

20 40 60 80 100

2016 2017 2018 2019e YOY

(2018- 2019e)

+ 30 %

Financing / Accounting

Strong growth is primarily financed through debt products

10

6,7 219 2,7 152 222 298 4,0 67

Interest expenses Financing Book value Fair value

Ratio - market value / debt burden / interest expense

(2019e, annualized, in € million) Financing strategy:

▪ Determined exploitation of

• pportunities provided by low-

interest environment; exploitation of benefits of leverage effect ▪ Risk management: non- recourse based financing ▪ Preferred financing through local or regional providers

Accounting (HGB [German Commercial Code])

▪ Entered into balance sheet at book value, hidden reserves are realised upon sale

Bond Banks Total Bond (5.9%) Banks (1.8%) Total (3.1%)

Rental income €19.8 million

Hidden reserves: €76 million

11

Financing / Accounting

Conversion from HGB to IFRS HGB

Balance sheet

(principal positions, in € million)

31.12.2017 31.12.2018 30.06.2019 Fixed assets 71.8 173.2 183.5 Current assets 8.1 10.5 17.7 Equity 6.9 9.0 16.5 Liabilities 71.8 166.9 176.2 Balance sheet total 80.1 184.3 201.6

IFRS

Fixed assets 71.8 239.4 251.7 Current assets 8.8 10.3 19.4 Equity 6.8 69.8 77.7 Deferred taxes 15.5 15.2 Liabilities 73.4 164.5 178.2 Balance sheet total 80.2 249.8 271.1

12

Capital market

All three bonds placed with a total volume of €70 million

6.00% bond 2018/2023

Fully placed (€25 million) WKN A2G9G6 ISIN DE000A2G9G64

▪ Issue volume: up to €25 million ▪ Dividend coupon: 6.0% p.a. ▪ Interest payment: semi-annually ▪ Maturity: 20/02/2023 ▪ Collateral: registered land debt ▪ Listing: Frankfurt stock exchange

7.10% bond 2016/2021

Fully placed (€15 million) WKN A2BPUC ISIN DE000A2BPUC4

▪ Issue volume: up to €15 million ▪ Dividend coupon: 7.1% p.a. ▪ Interest payment: annually ▪ Maturity: 18/10/2021 ▪ Collateral: registered land debt ▪ Listing: Frankfurt stock exchange

Frankfurt stock exchange market price

102.61

03/02/2020 Frankfurt stock exchange market price

103.10

03/02/2020

5.25% bond 2019/2024

Fully placed (€30 million) WKN A2TSB1 ISIN DE000A2TSB16

▪ Issue volume: up to €30 million ▪ Dividend coupon: 5.25% p.a. ▪ Interest payment: semi-annually ▪ Maturity: 29/04/2024 ▪ Collateral: registered land debt ▪ Listing: Frankfurt stock exchange 09/2019: Scope affirms BB- rating of the FCR bonds, outlook stable

Frankfurt stock exchange market price

100.00

03/02/2020

13

Capital market

FCR share well established on the stock exchange after just one year

ISIN / WKN DE000A1YC913 / A1YC91 Ticker symbol FC9 Market place XETRA and Frankfurt, Segment Scale Munich (m:access) First listing 07/11/2018 Total number of shares 9,146,404 non-par value registered shares (ordinary shares) Registered share capital € 9,146,404 Share price (03/02/2020) €12.00 Market capitalisation €110 million Designated Sponsor BankM AG, Oddo Seydler Bank AG Research ▪ SMC Research (Up-date 13/01/2020): recommendation to buy, target price: €14.10 ▪ First Berlin Research (Up-date 27/08/2019): recommendation to buy, target price: €13.40

Share master data Shareholder structure

68.3 % 22.9 % 8.8%

RAT Asset & Trading AG Individual Investor free float

FCR share

Market place XETRA

14

Kapitalmarkt

Pleasing development of the FCR share in the past 12 months

Source: BankM AG

Last price Jan 2020 Last price

• 1 month

Last price

• 1 year

High (1 year) Low (1 year) Performance 1 month Performance 1 year FCR Immobilen AG 12.000 11.900 9.225 12.500 7.251 0.84% 30.08%

Capital market

Research companies see a target price of up to €14.10

Company Focus First release Up-date

Equity research

22/11/2018 Recommendation to buy Target price: €13.65 (share split adjusted)

13/01/2020 Recommendation to buy (unchanged) Target price: €14.10 (unchanged)

16/09/2019: Recommendation to buy, target price: €14.10 | 03/06/2019: Recommendation to buy, target price: €13.85 (share split adjusted)

Equity research

12/11/2018 Recommendation to buy Target price: €12.50 (share split adjusted)

27/08/2019 Recommendation to buy (unchanged) Target price: €13.40

11/06/2019: Recommendation to buy, target price: €13.00 | 20/03/2019: Recommendation to buy, target price: €12.50 (each share split adjusted)

Equity research 21.11.2019 Full coverage initiation

07/11/2018 Scale Research Report – Initiation 30/08/2019: Scale Research Report – Update 31/05/2019: Scale Research Report – Update

Rating

16/05/2018 B+ (Corporate) BB- (Bonds)

11/09/2019 (Rating confirmed) B+ (Corporate) BB- (Bonds)

15

Further development of FCR Immobilien AG

Priorities in 2020

16 Business activities Clear focus on core business (retail real estate in Germany) Inorganic growth: acquisition of real estate Expansion of real estate portfolio: €500 million by the end of 2020 Capital market Annual financial statements 2019: conversion of accounting according to IFRS Forecast for the 2020 financial year New bond planned Use of the entire value chain (purchasing, administration, sales) Positioning as an innovation leader in digitalization (use of artificial intelligence) Proposed dividend for the 2019 financial year: between €0.30 and €0.40 per share Up-grade exchange segment: change in the regulated market

2019 impact areas

Target: Most innovative real estate company in Germany

17

With KI³, FCR is developing a comprehensive future programme with a focus on digitalisation and artificial intelligence to enhance our ability to act even faster, more efficiently and thus to be even more profitable on the market. FCR innovations form the core in this regard and secure an essential, sustainable competitive advantage. We strive to be perceived as Germany’s most innovative real estate company

• n the market.

New growth and earnings opportunities

Strategic equity investment in Immoware24

18

▪ Immoware24 offers an innovative real estate management system that can be used completely as Software as a Service (SaaS) over the Internet. Immoware24's expertise complements the technological basis of FCR. ▪ Through the use of artificial intelligence (AI) from the purchase of real estate, through asset management to sales, FCR has quickly developed into one of the innovation leaders in the real estate sector. Exploiting additional potential and expanding the market position by jointly developing new products and tools in a dynamically developing market

Our investor relations: transparent, comprehensive, sustainable

Financial Calendar 2020

19 19/02/2020 ▪ Preliminary figures for the 2019 financial year 10/03/2020 ▪

• 32. Prior Capital Markets Conference

22/04/2020 ▪ PLATOW Stock Exchange FORUM 28/04/2020 ▪

• 29. MKK Munich Capital Markets Conference

April/May 2020 ▪ Publication of annual report 2019 April/May 2020 ▪ Interim report on Q1 2020 19/05/2020 ▪ Early Annual Conference 28/05/2020 ▪ General meeting 18/06/2020 ▪ Real Estate conference, Munich Stock Exchange August 2020 ▪ Half-yearly financial report 2020 05.-07/10/2020 ▪ EXPO REAL November 2020 ▪ Interim report on Q3 2020 16.-18/11/2020 ▪ German Equity Forum 08/12/2020 ▪

• 30. MKK Munich Capital Markets Conference

Last up-dated: February 2020

20

FCR Immobilien AG Contact

Falk Raudies Executive Board FCR Immobilien AG, Paul-Heyse-Straße 28, 80336 Munich Telephone: +49 89 413 2496 10 Email: f.raudies@fcr-immobilien.de www.fcr-immobilien.de

Disclaimer: this document is not a prospectus for the purposes of German capital market laws nor an offer requiring a prospectus or a public offering. It does not contain any express and/or implied warranties, promises or commitments on the part of FCR Immobilien AG or the companies associated with FCR Immobilien AG. All assumptions and calculations are based on careful research. Notwithstanding all due care, deviations from the stated assumptions may occur. We do not assume any liability for the realisation of the yield and liquidity projections, for future changes of actual, economic, legal, tax or other general conditions nor for the accuracy and completeness of the information provided in this document.