TAG Immobilien (TEG) Q3 2024 earnings summary

Executive summary

• Operations for FY2024 are on track, with FFO I stable year-over-year and net income from sales in Poland up nearly 40% to €39 million.

• NTA per share increased 2% to €18.61, and LTV reduced to 46.1%, nearing the 45% target.

• Dividend reinstated with a proposed €0.40 per share, based on a 40% payout ratio of FFO I.

• Strong like-for-like rental growth in Germany at 2.8% and in Poland at 3.7%, with vacancy rates declining.

• Liquidity increased to €670 million after a €500 million bond issuance, supporting further Polish investments.

Financial highlights

• FFO I at €130.5m for 9M 2024, nearly unchanged year-over-year; FFO II at €167.5m for 9M 2024, driven by strong Polish sales.

• Adjusted EBITDA from rental business was €178.3m, slightly down from €182.0m year-over-year.

• Net income from sales in Poland rose by nearly 40% year-over-year to €38.8m.

• EPRA NTA per share improved to €18.61 from €18.31 at year-end 2023.

• LTV ratio improved to 46.1% from 47.0% at year-end.

Outlook and guidance

• FY 2024 FFO I guidance at €170–174m, unchanged; dividend payout ratio set at 40% of FFO I.

• FY 2025 FFO I expected to rise to €172–176m (+1%), with FFO II at €233–243m (+8%).

• Net income from Polish sales projected to increase 31% in 2025 to €61–67m.

• Like-for-like rental growth guidance for 2025: 2.5–3% in Germany, 3.0–3.5% in Poland.

• Vacancy rate in Germany expected to decline further toward 3.5% in 2025.