Deutsche Konsum REIT had a very strong first half of financial year 2019/2020

Press release

Deutsche Konsum REIT had a very strong first half of financial year 2019/2020

- Rental income increased by 28% to EUR 25.0 million

- FFO of EUR 15.3 million or FFO per share of EUR 0.48

- EPRA NAV per share of EUR 9.98 (post dividend payment of EUR 0.35 per share)

- Forecasts confirmed / Impact of COVID 19 epidemic so far low

Broderstorf, 14 May 2020 - Deutsche Konsum REIT-AG ("DKR") (ISIN DE000A14KRD3) continued to grow strongly in the first half of financial year 2019/2020 ("H1") as expected.

Rental income and FFO increase significantly
The acquisitions of recent months have already contributed to a significant increase in rental income and funds from operations ("FFO") in the second quarter. Rental income rose by 28% from EUR 19.5 million to EUR 25.0 million in the first half of the year compared with the same period of the previous year.

As a result, funds from operations ("FFO") also increased by 28% to EUR 15.3 million. aFFO (FFO after deduction of capitalised modernisation measures) amounted to EUR 7.2 million (H1 2018/2019: EUR 11.2 million) due to current revitalisation projects and new construction measures for various properties.

Property portfolio grows to EUR 0.8 billion
DKR's real estate portfolio as at 31 March 2020 comprises 135 properties with a balance sheet value of around EUR 702.9 million (31 December 2019: EUR 619.9 million) and a rental space of around 796,000 m².

Including other notarised properties for which the transfer of benefits and encumbrances had not yet taken place on the balance sheet date, DKR's total portfolio (pro forma) currently comprises 166 retail properties with annual rent of around EUR 64 million, carrying value of around EUR 795 million and lettable area of around 902,000 m². The purchase yield of the entire portfolio is currently around 10.5%.

DKR has already acquired 44 retail properties with an investment volume of around EUR 170 million and an annual rent of EUR 15.6 million in the first half of the financial year. In addition, one property was sold in Berlin-Tegel in March 2020. The yield on the properties purchased was 9.2%, and 5.0% on those sold. The transfers of benefits and encumbrances of the larger properties acquired took place throughout the second quarter and will continue to take place in the third quarter. Accordingly, a significant increase in rental income is expected from the third quarter onwards.

Even in the current market environment, the Company sees very good opportunities for further profitable growth. The Company is currently engaged in concrete negotiations for the acquisition of properties with a total value of more than EUR 100 million with similar yields to the existing portfolio. This will likely result in a further increase in the share of rents attributable to the food retail sector.

EPRA NAV at EUR 9.98 per share / Net LTV temporarily at 55.8%
EPRA NAV increased to EUR 9.98 per share despite the dividend payment of EUR 0.35 per share in March 2020.

The net LTV gearing ratio was 55.8% as of 31 March 2020, which resulted from the issue of a further unsecured bond on 10 March 2020 of EUR 40 million. This provides DKR with another flexible instrument to take advantage of acquisition opportunities that arise at short notice for further growth. However, the LTV is expected to fall back to the target value of around 50% during the course of the financial year.

Forecasts confirmed / Impact of COVID 19 pandemic so far minimal
Based on the positive business development in the first half of the financial year and the expected further revenue growth in the following quarters, the Management Board confirms its forecast and expects an FFO of between EUR 34 million and EUR 36 million in the 2019/2020 financial year.

Furthermore, the Management Board confirms its expectation to achieve an FFO run rate (annualised FFO without accrual effects) of between EUR 40 million and EUR 42 million as of 30 September 2020.

The effects of the COVID 19 pandemic on DKR have so far only led to rent deferrals of just under 30% of the April rents by tenants affected by ordered closures. At present, however, only approximately 4% of tenants are affected by closures, such that May rents should be almost completely paid.

Rolf Elgeti, Chairman of the Management Board of Deutsche Konsum REIT-AG: "The first half of the financial year has again developed very positively as planned. Our business model is defensive with largely stable, non-cyclical rental cash flows as well as very solid and conservative financing. In addition, we currently see a continuing well-filled acquisition pipeline with attractive properties, which we intend to use to create further value for our shareholders."

Publications for the first half of 2019/2020
The half-year financial report 2019/2020, the presentation of results and further information on the Company can be found at https://www.deutsche-konsum.de/en/.

About Deutsche Konsum
Deutsche Konsum REIT-AG based in Broderstorf is a listed real estate company focusing on retail properties in Germany for goods required for daily use in established micro-locations. The focus of the Company's activities is on the management and development of real estate with the aim of achieving a steady increase in value and the realisation of hidden reserves. DKR's total portfolio currently comprises 166 retail properties with an annualised rent of EUR 64 million.

Due to its REIT status ('Real Estate Investment Trust'), the Company is exempt from corporation and trade tax. The shares of the Company are listed on the Prime Standard of the Deutsche Boerse (ISIN: DE 000A14KRD3).

Contact:
Deutsche Konsum REIT-AG
Stefanie Frey
Investor Relations
E-Mail: sf@deutsche-konsum.de
Phone: +49 (0) 331 74 00 76 - 533