Press Release 10 September 2015 - bfw Liegenschaften AG

Press Release

10 September 2015

bfw liegenschaften ag achieves good results in the 1st Half-Year 2015 Frauenfeld, 10 September 2015 – bfw liegenschaften ag (SIX Swiss Exchange: BLIN) achieved excellent operating results in the first half-year 2015. The value of the real estate portfolio increased by 13% to CHF 392.4 million during the reporting period. Net rental income rose by 17% to CHF 9.4 million, and the EBIT reached CHF 12.5 million in the first half of 2015 (H1 2014: CHF 7.0 million). Excluding the fair value changes of the interest rate swaps and receiver swaptions, the earnings including effects from changes in fair value of real estate investments and deferred taxes amounted to CHF 8.5 million (H1 2014: CHF 4.4 million). The Net Asset Value (excl. the valuation changes in interest rate swaps and receiver swaptions) stood at CHF 38.14 per share.

Details to the Half-Year 2015 results The value of the real estate portfolio increased by 13% to CHF 392.4 million in the first half-year 2015 (31.12.2014: CHF 346.6 million). The increase is due to the newly acquired real estate at Hönggerstr. 40 / Röschibachstr. 22 in Zurich (acquired in January 2015 for CHF 29.9 million), the successful development of the new building projects (CHF 9.8 million) and to positive changes in the fair value of real estate investments (CHF 6.0 million). The investment portfolio currently has annual target rental income of CHF 21.6 million. Net rental income for the first half-year 2015 increased by 17% to CHF 9.4 million (H1 2014: CHF 8.1 million). The increase is mainly due to the newly acquired properties and to the completed building project Bellevue Park in Kreuzlingen, which generates full rental income since February 2015. Net yield of investment properties was 4.0% and 4.3% without new building projects, respectively. The vacancy rate excluding new building projects / conversion projects was 6.9%. The higher vacancy rate is mainly due to the acquisition of the real estate at Hönggerstr. / Röschibachstr., Zurich (at time of the purchase vacancy rate of 15%) and the already higher vacancy rate by year-end 2014 (6.6% in December 2014). Direct operating expenses for investment properties amounted to CHF 1.6 million (H1 2014: CHF 1.5 million). The slight increase is a result of the growth in the investment portfolio. As a percentage of net rental income, direct operating expenses were at 16.9% (H1 2014: 18.0%). Consulting expenses remained unchanged at CHF 0.4 million. Administrative expenses increased to CHF 1.0 million (H1 2014: CHF 0.8 million), mainly as a result of the higher management fee due to the increased size of the portfolio and to slightly higher capital taxes. The valuation of the investment portfolio by KPMG AG, the independent real estate evaluator, resulted in positive changes in the fair value of real estate investments in an amount of CHF 6.0 million (H1 2014: CHF 1.6 million). The increase in market values is mainly due to a reduction of the discount rate applied by KPMG (average discount rate 4.68%) and to the successful development of the new building projects. For the first half-year 2015, EBIT stood at a solid profit of CHF 12.5 million (H1 2014: CHF 7.0 million). The substantial increase compared to the previous year period is mainly due to the higher rental income as a result of the purchased properties (purchase of one property each in H2 2014 and H1 2015) and the profit from the valuation of the investment portfolio. Net financial expenses were CHF 1.8 million for the first half-year 2015 (H1 2014: CHF 1.5 million). The increase is due to the higher mortgage liabilities in conjunction with the two real estate acquisitions and the financing of the new building projects Bellevue Park Kreuzlingen and Seeleben Romanshorn. As a result of the changes in the interest rate level in both reporting periods (H1 of each year), the fair value reflection of the interest rate swaps and receiver swaptions led to a negative effect before taxes of CHF 1.8 million for the first half-year 2015 (H1 2014: negative effect of CHF 3.1 million). However, these fair value adjustments, which in accordance with IAS 39 have to be shown at each balance sheet date, do not impact cash flow and do not affect the company’s operating effectiveness or its dividend policy at all. Taking into account the fair value changes of the interest rate swaps and receiver swaptions, the earnings including effects from changes in fair value of real estate investments and deferred taxes amounted to CHF 7.0 million for the first half-year 2015 (H1 2014: CHF 1.9 million). Excluding the fair value changes of the interest rate swaps and receiver swaptions, net earnings for the first half-year 2015 were CHF 8.5 million (H1 2014: CHF 4.4 million). Net earnings per share excluding the changes in fair value were CHF 1.64 (H1 2014: CHF 0.86).

bfw liegenschaften ag ∙ Bahnhofstrasse 92 ∙ CH-8500 Frauenfeld Phone +41 848 820 410 ∙ Fax +41 848 820 411 ∙ www.bfwliegenschaften.ch ∙ [email protected]

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Very strong balance sheet Total assets increased by 7% compared to year-end 2014 and amounted to CHF 406.9 million (31.12.2014: CHF 381.5 million). This is mainly due to the increase in value of the portfolio and to the investments made. During the first half-year 2015, mortgage liabilities increased by CHF 23.2 million. A fix mortgage of CHF 17.5 million with maturity of 8 years was concluded for the new property in Zurich. The average remaining life to maturity of all mortgages was 4.4 years as at 30 June 2015 (31.12.2014: 4.3 years). Equity amounted to CHF 186.7 million as at 30 June 2015, representing a very solid equity ratio of 45.9%. Excluding the fair value changes in the interest rate swaps and receiver swaptions, the equity ratio was 48.9% as of balance sheet date. The Net Asset Value was CHF 35.96 as at 30 June 2015 (31.12.2014: CHF 35.92). The change in the NAV is attributable to the pay-out of capital contribution of CHF 6.7 million as per April 2015 and to an earnings contribution for the first half-year 2015 of CHF 7.0 million. Excluding the fair value changes in the interest rate swaps and receiver swaptions, the Net Asset Value was at CHF 38.14 (31.12.2014: CHF 37.80). Conversion projects and new building projects progressing according to plans The four new building projects and two conversion projects have run according to plans during the first half-year 2015: The project “Bellevue Park” in Kreuzlingen (in total 3 houses with 52 city-apartments, 5 smaller commercial areas, 93 parking spaces) was finalized with the completion of the third house in February 2015. The project “Seeleben” in Romanshorn (36 apartments, 36 parking spaces) was also completed by March 2015. Both projects were reclassified to the investment properties’ segments and together have target rental income of approximately CHF 2 million per annum. Completion of the project “Zweidlen” in Glattfelden (24 apartments, 45 parking spaces) is scheduled for late summer 2015, and the reclassification to the investment properties will take place in the second half of 2015. The new building project “Viaduktstr. 9+11” in Grenchen (28 apartments, 31 parking spaces) will be ready for occupation by winter 2015. The conversion project “Schaffhauserstr. 210“ in Zurich includes 46 apartments, 14 parking spaces and a 2 commercial area of about 170 m on the ground floor. The construction works started during the first quarter of 2015 and completion is scheduled for early 2016. The building permit for the second conversion project at “Freiestr. 4“ in Weinfelden was granted in July 2015. Construction works are scheduled to start in January 2016. 2 The project includes 42 apartments, 60 parking spaces and commercial / services areas of about 850 m . Completion of this project is expected in early 2017. Altogether, the four current projects will increase the target rental income by about CHF 2.9 million, once they are completed. Outlook 2015 For the second half of 2015, bfw liegenschaften ag expects to achieve similar operating results at the EBIT level (excluding effects from changes in fair value of real estate investments) like in the first half-year 2015.

Contacts: Beat Frischknecht Chief Executive Officer +41 52 728 01 02 [email protected]

Reto Borner Chief Financial Officer +41 52 728 01 06 [email protected]

Agenda: 16 March 2016 27 April 2016

Publication Results Fiscal Year 2015 / Annual Report 2015 Ordinary General Meeting of Shareholders


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Key Figures Income Statement

H1 2015

H1 2014

9 429 9 429

8 076 8 076

in TCHF Rental income Total operating income Direct operating expenses for investment properties

- 1 596

- 1 451

Consulting expenses

- 383

- 394

Administrative expenses

- 991

- 803

- 2 970

- 2 648

6 002

1 556

EBIT

12 461

6 984

Financial income Financial expenses

11 - 1 809

49 - 1 543

Total operating expenses Total changes in fair value of real estate investments

Amortisation interest rate swaps

- 114

- 114

Valuation of the fair value of interest rate swaps

- 1 847

- 3 067

Taxes

- 1 743

- 410

Earnings incl. effects from changes in fair value of real estate investments / deferred taxes

6 959

1 900

Earnings excl. effects from changes in fair value of real estate investments / deferred taxes

2 128

602

Earnings excl. fair value adjustments of interest rate swaps / deferred taxes

8 492

4 445

30.06.2015

31.12.2014

406 861 220 179 186 682 45.9% 197 990 48.9%

381 482 195 011 186 471 48.9% 196 247 51.4%

35.96 38.14

35.92 37.80

30.06.2015 392 415 42 4 4.0% 4.3% 11.5% 6.9% 2.0% 2.1% 4.4 years

31.12.2014 346 602 41 4 3.7% 4.3% 5.0% 4.7% 1.9% 2.0% 4.3 years

Balance sheet in TCHF Total assets Total liabilities Equity Equity ratio Equity excl. fair value adjustments of interest rate swaps / deferred taxes Equity ratio excl. fair value adjustments of interest rate swaps / deferred taxes Net Asset Value (NAV) in CHF Net Asset Value excl. fair value adjustments of interest rate swaps / deferred taxes in CHF Total investment portfolio Total value of real estate portfolio in TCHF Number of investment properties Number of new building projects Yield net Yield net excl. new building projects / conversion projects Vacancy rate Vacancy rate excl. new building projects / conversion projects Ø interest rate excl. amortisation of interest rate swaps Ø interest rate incl. amortisation of interest rate swaps Ø remaining life to maturity of mortgages

The Half-Year Report 2015 of bfw liegenschaften ag is available at www.bfwliegenschaften.ch – Investor Relations – Financial Reports. Direkt link http://www.bfwliegenschaften.ch/index.php/en/investor-relations/financial-reports Information on bfw liegenschaften ag www.bfwliegenschaften.ch bfw liegenschaften ag is a real-estate company with headquarters in Frauenfeld in the canton of Thurgau, Switzerland. It focuses on attractive residential properties in commuting areas close to business centres in the German-speaking part of Switzerland. The registered A shares of bfw liegenschaften ag are listed on the SIX Swiss Exchange (Symbol BLIN, Securities Number 1820611, ISIN Number CH 001 820 6117).


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