PRESENTATION HALF-YEAR 2017 RESULTS 1 04/2017 Strictly - - PowerPoint PPT Presentation

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PRESENTATION HALF-YEAR 2017 RESULTS 1 04/2017 Strictly - - PowerPoint PPT Presentation

PRESENTATION HALF-YEAR 2017 RESULTS 1 04/2017 Strictly confidential DISCLAIMER NEITHER THE INFORMATION IN THIS DOCUMENT NOR ANY RELATED MATERIALS be placed on, the accuracy, completeness or fairness of the information or opinions MAY BE


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PRESENTATION

HALF-YEAR 2017 RESULTS

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DISCLAIMER

NEITHER THE INFORMATION IN THIS DOCUMENT NOR ANY RELATED MATERIALS MAY BE TAKEN OR TRANSMITTED INTO THE UNITED STATES OR DISTRIBUTED OR REDISTRIBUTED, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES, AUSTRALIA, CANADA OR JAPAN. This presentation is strictly confidential to the recipient and has been prepared by Bank Vontobel AG (the “Lead Manager”), Stoneweg SA (the "Asset Manager") and Varia US Properties AG (the "Company") solely for information purposes and use at the presentation to the respective recipient ("Presentation"). By attending such Presentation, you agree to be bound by the following terms. This Presentation may not be reproduced, retransmitted or further distributed to the press

  • r any other person or published, in whole or in part, for any purpose. Failure to comply

with this restriction may constitute a violation of applicable securities laws. This Presentation does not constitute or form part of and should not be construed as, an offer to sell or issue or the solicitation of an offer to buy or acquire securities of the Company

  • r the Asset Manager in any jurisdiction or an inducement to enter into investment
  • activity. No part of this Presentation, nor the fact of its distribution, should form the basis
  • f, or be relied on in connection with, any contract or commitment or investment decision

whatsoever. This Presentation does not constitute a prospectus

  • r

a similar communication within the meaning of article 752, 652a and/or 1156 of the Swiss Code of Obligations ("CO") or a listing prospectus within the meaning of the listing rules of the SIX Swiss Exchange. The information contained herein consists of slides solely for use at the Presentation in connection with the proposed offering (the "Offering") of the Company’s shares (the "Shares") by the Company. Any purchase of Shares in the Offering should be made solely on the basis of the information contained in the offering circular constituting an issuance prospectus in the sense of art. 652a CO in the final form prepared by the Company (the “Offering Circular") and any other supplemental prospectus to be published in respect of the Offering. The Offering Circular will include a description of the risks specific to the situation of the Company and/or the offered Shares which are material for taking investment decisions. These risks must be considered carefully before making any investment decisions. The information contained in this Presentation has not been independently verified. Neither the Lead Manager, the Company nor the Asset Manager are under any obligation to update or keep current the information contained herein. Accordingly, no representation

  • r warranty or undertaking, express or implied, is given by or on behalf of the Lead

Manager, the Company, the Asset Manager or any of their respective members, directors, officers, agents or employees or any other person as to, and no reliance should be placed on, the accuracy, completeness or fairness of the information or opinions contained herein. None of the Lead Manager, Company or Asset Manager or any of their respective members, directors, officers or employees nor any other person accepts any liability whatsoever for any loss howsoever arising from any use of this Presentation or its contents or otherwise arising in connection with the Presentation. Neither the Presentation nor any copy of it may be taken or transmitted into the United States of America, its territories or possessions, or distributed, directly or indirectly, in the United States of America, its territories or possessions. Any failure to comply with this restriction may constitute a violation of U.S. securities laws. The Presentation is not an

  • ffer of securities for sale in the United States. Neither the Company nor the Asset

Manager have registered and do not intend to register any portion of the Offering in the United States or to conduct a public offering of any securities in the United States. The Securities may not be offered or sold in the United States except pursuant to an exemption from, or transaction not subject to, the registration requirements of the Securities Act. Additional restrictions may apply according to applicable securities laws of other jurisdictions, including, without limitation, the European Union This Presentation includes forward-looking statements, beliefs or opinions, including statements with respect to plans, objectives, goals, strategies, estimated market sizes and opportunities as well as strength of competitors which are based on current beliefs, expectations and projections about future events. The words "believe," "expect," "anticipate," "intends," "estimate," "forecast," "project," "will," "may," "should" and similar expressions identify forward-looking statements. The forward-looking statements in this Presentation are based upon various assumptions, many of which are based, in turn, upon further assumptions, including, without limitation, management’s examination of data available from third parties. Although the Lead Manager, the Company and the Asset Manager believe that these assumptions were reasonable when made, these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond its control, and the Company or the Asset Manager may not achieve or accomplish these expectations, beliefs or projections. Neither the Lead Manager nor the Company nor the Asset Manager, nor any of its members, directors, officers, agents, employees or advisers intend or have any duty or

  • bligation to supplement, amend, update or revise any of the forward-looking statements

contained in this Presentation. The information and opinions contained herein are provided as at the date of the Presentation and are subject to change without notice.

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AGENDA

SEPTEMBER 4, 2017 Key achievements Financials HY 2017 Portfolio and pipeline Outlook Q&A

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TODAY’S SPEAKER

■ Delegate of the Board of Directors, Varia US Properties AG ■ Head of US Investments

  • f Stoneweg SA, the

Asset Manager of Varia US Properties AG PATRICK RICHARD MANUEL LEUTHOLD ■ Chairman, Varia US Properties AG

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KEY ACHIEVEMENTS

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KEY ACHIEVEMENTS HALF-YEAR 2017

■ Total income up 31.2% to USD 43.3 million – rental income up 50.4% to USD 26.2 million ■ Significant 50% rise in effective gross income to USD 28.4 million ■ Increasing portfolio: Value of property portfolio tops USD 500 million and consists of 47 properties ■ Gross potential income increased to USD 71.1 million ■ Sustainable portfolio development secures future income growth ■ Acquisition of 13 assets ■ Expansion of the number of assets to 47 properties spread in 17 different States in the US (three deals to be completed and closed in the ongoing third quarter) ■ Focus on investing and consolidation of the existing portfolio ■ Value-add strategy containing substantial rental increase and value improvement ■ Key differentiator in a market where the demand for housing exceed the existing offer

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VARIA US PROPERTIES AT A GLANCE

Geographic breakdown of Varia Properties as of June 30, 2017 ■ Total value of property portfolio of USD 508.1 million ■ 47 assets comprising 7,289 units spread in 17 different States in the US ■ 28.4% of the properties are located in Florida – reduction by 13% compared to the end of 2016. Texas is following with a proportion of 17.6% ■ Further diversification of the geographical exposure – all new acquisitions are located in markets where Varia was not yet present ■ Stronger composition of larger assets and assets closer to each other and closer to larger metropolitan areas

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FINANCIALS HY 2017

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HY 2017 KEY FIGURES

2 Calculated on the weighted average

number of ordinary shares outstanding.

1 Equals HY 2017 EGI divided by

2016 EGI/2

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CONSOLIDATED STATEMENT OF PROFIT AND LOSS

In USD million As of June 30, 2017 Period from Sept. 28, 2015 through Jun. 30, 2016 Rental income 26.2 17.4 Other income 2.1 1.4 Bargain on purchase of subsidiary

  • 4.2

Net gain from fair value adjustment on invest. property 14.9 10.0 Total income 43.3 33.0 Total operating expenses 18.2 19.8 Operating profit 25.1 13.2 Profit before income tax 20.4 8.5 Profit for the period 15.0 6.5 Profit attributable to: Varia US Properties AG shareholders (in USD million) 12.2 2.9 Non-controlling interests (in USD million) 2.8 3.6 Net asset value per share (in USD) 34.03 32.46 Basic and diluted earnings per share (in USD)

calculated on the weighted average number of ordinary shares outstanding

1.83 1.39

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CONSOLIDATED STATEMENT OF FINANCIAL POSITION

Assets in USD million As of June 30, 2017 As of December 31, 2016 Total current assets 68.2 98.0 Total non-current assets 520.3 351.8 Total assets 588.6 449.8 Liabilities and equity in USD million As of June 30, 2017 As of December 31, 2016 Total current liabilities 12.5 8.7 Total non-current liabilities 330.2 216.2 Total liabilities 342.7 224.8 Equity attributable to Varia US Properties AG shareholders 226.6 208.4 Non-controlling interest (NCI) 19.3 16.6 Total equity 245.8 225.0 Total liabilities and equity 588.6 449.8

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OPERATING RESULTS

In USD million

As of June 30, 2017

Realized income 28.4 Total Operating expenses (14.9) Net Operating Income 13.5 Finance cost (4.7) Operating results before taxes and exceptional 8.7 Expensed capex (1.6) Exceptional expenses (1.6) Realized operating profit 5.5 Non realized profit 14.9 Tax provision (5.4) Profit attributable to non controlling interests (2.8) Profit attributable to Varia 12.2

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PORTFOLIO AND PIPELINE

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PORTFOLIO SUMMARY AS OF JUNE 30, 2017

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13 NEW ACQUISITIONS COMMITTED OVER THE PERIOD

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WHERE THE NEW ACQUISITIONS ARE LOCATED

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ACQUISITIONS SINCE CAPITAL INCREASE (1/3)

CITY STATE ACQUISITION DATE Dallas Texas December 2016 NUMBER OF UNITS NET LETTABLE AREA GROSS POTENTIAL RENT 346 23,383 m2 4,109,600 USD

WOOD HOLLOW CROWN LAKE

CITY STATE ACQUISITION DATE Columbia South Carolina February 2017 NUMBER OF UNITS NET LETTABLE AREA GROSS POTENTIAL RENT 272 21,274 m2 3,197,693 USD CITY STATE ACQUISITION DATE Dallas Texas February 2017 NUMBER OF UNITS NET LETTABLE AREA GROSS POTENTIAL RENT 207 15,384 m2 2,437,700 USD

RIDGE ON SPRING VALLEY

CITY STATE ACQUISITION DATE St Louis Missouri February 2017 NUMBER OF UNITS NET LETTABLE AREA GROSS POTENTIAL RENT 252 17,956 m2 2,687,720 USD

MARYLAND PARK

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ACQUISITIONS SINCE CAPITAL INCREASE (2/3)

CITY STATE ACQUISITION DATE Bremerton Washington March 2017 NUMBER OF UNITS NET LETTABLE AREA GROSS POTENTIAL RENT 116 10,367 m2 2,078,400 USD

PINE RIDGE BRIDGE HOLLOW

CITY STATE ACQUISITION DATE Fort Worth (Dallas) Texas March 2017 NUMBER OF UNITS NET LETTABLE AREA GROSS POTENTIAL RENT 280 19,383 m2 2,828,440 USD CITY STATE ACQUISITION DATE St Louis Missouri April 2017 NUMBER OF UNITS NET LETTABLE AREA GROSS POTENTIAL RENT 182 14,819 m2 1,992,160 USD

BEAU-JARDIN

CITY STATE ACQUISITION DATE Fort Worth (Dallas) Texas April 2017 NUMBER OF UNITS NET LETTABLE AREA GROSS POTENTIAL RENT 200 12,557 m2 1,909,640 USD

WOODSTONE

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ACQUISITIONS SINCE CAPITAL INCREASE (3/3)

CITY STATE ACQUISITION DATE Evansville Indiana April 2017 NUMBER OF UNITS NET LETTABLE AREA GROSS POTENTIAL RENT 245 22,064 m2 2,100,944 USD

DEVONSHIRE GARDEN & PLACE ZONA VILLAGE

CITY STATE ACQUISITION DATE Tucson Arizona June 2017 NUMBER OF UNITS NET LETTABLE AREA GROSS POTENTIAL RENT 183 8,999 m2 1,451,740 USD

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INVESTMENT STRATEGY

THREE INDIVIDUAL INVESTMENT STRATEGIES A: Value-adding strategy → Acquisition, renovation, improvement and stabilizing operations of real estate properties to maximize rent potential and increase long-term value → B and C products: 15-35 years old buildings well maintained allowing to add value through renovations leading to rent increases → Apartments specifically built for the American workforce B: Transition strategy for rent restricted properties (LIHTC) → Acquisition of properties with rent restrictions in place that are about to expire and enable a transition into the market C: Strategy for stabilized properties → Acquisition of stabilized properties which generate solid and regular returns ■ Investment in US multifamily real estate properties situated in strong urban locations in supply- constrained markets ■ Mid- to long-term investment perspective through three individual investment strategies:

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OUTLOOK

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OUTLOOK 2017

INVESTMENT → Three additional deals in Kentucky and Arizona will be completed and closed in the third quarter 2017 for a total of USD 95.6 million → Finish launching all the capex investment programs and the value-add strategy in the second semester STRATEGY → Focus on the existing portfolio, especially in terms of renovation → Implementation of planned works, rents increase and returns optimization → Continuous expansion of the presence of Varia’s asset manager in the US FINANCIALS → Delivery of solid results in US Dollar by continuing to implement the Company’s growth strategy → Further increase of the value of the portfolio with a strong distribution from the properties

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Q&A

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INFORMATION

CONTACT INFORMATION Michael Dueringer Investor Relations / Corporate Communications Phone: +41 43 244 81 42 E-mail: investors@variausproperties.com INVESTOR INFORMATION Listing: SIX Swiss Exchange Currency: USD Ticker symbol: VARN ISIN: CH 030 528 529 5 Listing date: December 8, 2016 FINANCIAL CALENDAR Full-year results 2017 13 April 2018

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VARIA ON THE SIX SWISS EXCHANGE

STOCK DETAILS

High 43.95 08.05.2017 Low 35.00 22.02.2017 Price change (1HY 2017) 15.57% Average volume 1,893

PERFORMANCE

Listing SIX Swiss Exchange Ticker symbol VARN Swiss security number 30 528 529 ISIN CH 030 528 529 5 Product type Mid & small caps Swiss shares Security type Registered share Nominal value CHF 1.00 per registered share Number in issue 6,658,710 Share price January 3, 2017 – June 30, 2017

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THANK YOU FOR YOUR ATTENTION