DGAP-News: Corestate: Financial figures for the first half of 2020 affected by corona crisis - investment markets recover gradually with focus on the fourth quarter

Corestate: Financial figures for the first half of 2020 affected by corona crisis - investment markets recover gradually with focus on the fourth quarter

• Revenues of € 95.6 million; EBITDA of € 25.9 million; adjusted net profit of € 11.4 million.
• Mezzanine business providing solid income
• Product focus on Core/Core+ systematically intensified
• Group-wide efficiency programme initiated
• Significant reduction in debt planned

Luxembourg, 11 August 2020. Corestate Capital Holding S.A. (Corestate), a leading independent real estate investment manager in Europe, generated aggregated revenues and gains of € 95.6 million (previous year: € 121 million), EBITDA of € 25.9 million (previous year: € 68.9 million) and adjusted net profit of € 11.4 million (previous year: € 47.8 million). These figures reflect the shifts in risk propensity among investors in the transaction market due to the COVID-19 pandemic and the associated temporary impact on revenues from warehousing, alignment capital and performance-based fees.

Real estate assets under management (AuM), the core business, grew organically by 3.4 percent to € 24.9 billion. Assets under management including non-real-estate assets came to € 28.2 billion as at 30 June 2020. Corestate subsidiary Helvetic Financial Services (HFS) was able to cement its market-leading position in the crisis. The mezzanine fund volume stood at over € 1.3 billion and delivered stable margins and income.

"The shifts in the market and in client behaviour caused by the crisis are helping us significantly accelerate the changes we had already initiated in our product portfolio," said Lars Schnidrig, CEO of Corestate. "Institutional investors in particular are almost exclusively requesting investment opportunities in the Core segments, which is what we now focus on. At the same time, the considerable detrimental impact of the pandemic on our earnings is forcing us to adjust our cost structure. We will simplify our business in certain areas, focus on efficiency and digitalization and want to generate major savings as a result."

The company has also announced plans to refine and standardise the Group's brand identity and position. The new direction will be accompanied by an even stronger focusing of products on ESG criteria and the further expansion of sales in the DACH region.

Net financial debt stood at € 530 million (previous year: € 607 million) at the end of June and is set to be lowered significantly to under € 400 million in upcoming quarters due to the scheduled placement of co-investments and warehousing assets. The financial leverage ratio, the ratio of net financial liabilities to EBITDA, was at 4.0x at the close of the six-month period. The Company has confirmed the medium-term target corridor of 2.0x to 3.0x based on the planned debt reduction.

Due to the continuing global uncertainties resulting from the COVID-19 pandemic, the company is not yet able to publish a detailed financial outlook for the ongoing fiscal year. Especially the risk of a second wave of infections resulting in further unpredictabilities in the market significantly hampers resilient forecasts on potential fees from transactions or income from alignment capital and warehousing. Investors currently show low risk appetite and tend to postpone investment decisions. The company although expects the sentiment to improve in the fourth quarter. Moreover, Corestate anticipates stable revenues from asset and property management and a stable cost base. As soon as reliable planning is feasible, the company will publish a financial outlook for 2020.

Nils Huebener, CIO of Corestate, adds: "Although we see some signs of a gradual return to normality following the lockdowns in Europe, it remains hard to predict how stable this recovery already is. We believe that the real estate transaction market bottomed out in the second quarter and it is likely that the market will gradually recover over the next months. The pressure towards investments in real estate will intensify in view of the low-interest environment, and we deliver the right products with our tailor-made investment solutions and sustainable asset management competence. This puts us in an excellent position to return to our successful growth path in the foreseeable future."

Press Contact
Jorge Person
T: +49 69 3535630-136 / M: +49 162 2632369
[email protected]

IR Contact
Mario Groß
T: +49 69 3535630-106 / M: +49 162 1036025
[email protected]

About CORESTATE Capital Holding S.A.

CORESTATE Capital Holding S.A. (CORESTATE) is an investment manager and co-investor with around EUR 28 billion in assets under management. As a fully integrated real estate platform, CORESTATE offers its clients combined expertise in the areas of investment and fund management as well as real estate management services. The company operates as a respected business partner of institutional clients and wealthy private investors internationally. CORESTATE is headquartered in Luxembourg and has 42 offices, e.g. in Frankfurt, London, Paris, Madrid, Zurich and Amsterdam. The company employs around 800 people and is listed in the Prime Standard (SDAX) of the Frankfurt Stock Exchange. Further information may be found at www.corestate-capital.com.

Forward-looking statements

This press release may contain forward-looking statements based on current assumptions and forecasts made by our management. Various known and unknown risks, uncertainties and other factors could lead to material differences between the actual future results, financial situation, development or performance of our company and the estimates given here. These factors include those discussed in our public reports, which are available on our website at www.corestate-capital.com. The company assumes no liability whatsoever to update these forward-looking statements or to conform them to future events or developments. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof.