Half year results 2017: VGP performs at record levels

22. 08. 2017

  • Profit for the period of € 62.5 million (+ € 19.7 million compared to 30 June 2016)
  • Net valuation gain on the investment portfolio reaches € 59.9 million (compared to € 65.1 million at the end of June 2016)
  • At the end of May, a third closing occurred with the VGP European Logistics joint venture (50/50 JV with Allianz Real Estate) with a transaction value in excess of € 173 million
  • Capital distribution in cash of € 20.1 million (€ 1.08 per share) paid to the shareholders on 4 August 2017

VGP, the developer, manager and owner of high quality logistics real estate in Europe, has today published its half-year 2017 results. The Group experienced strong growth in all its active markets, with profits for the period up to € 62.5 million, an increase of 46.1% on the same period last year, and net valuation gain on the portfolio amounting to €59.9 million.

Jan Van Geet, CEO of VGP Group, said: “We are delighted with a positive set of half yearly results which demonstrate the strength of our business model. Our future project pipeline is robust, supported by a successful bond issuance program that has exceeded expectations, and we are completing current projects at record pace, driving profits higher from this period last year. We believe in rewarding the loyalty of our investors and so we are delighted to share our success with them.”

The Group’s portfolio has continued to make strong progress during the first half, growing both in value and physical size. The value of annualised committed leases is now € 78.2 million[1],demonstrating a € 13.8 million increase in the first half of 2017 alone, while the signed annualised committed leases at the end of June 2017 represent a total of 1,564,320 m² of lettable area, a 22.4% increase since 31 December 2016. Of this total space 573,433 m² belong to the own portfolio (545,715 m² as at 31 December 2016) and 990,888 m² to the VGP European Logistics joint venture (732,523 m² at 31 December 2016).

At the end of May, a third successful closing occurred with the VGP European Logistics joint venture (50/50 JV with Allianz Real Estate). It is our shared intention to grow this property portfolio considerably in the coming years (> € 1.5 billion in asset value). The transaction value of the third closing was in excess of € 173 million. In the first half of 2017, VGP delivered a total of 9 projects representing 169,566 m² of lettable area, with an additional 21 projects under construction representing 527,876 m² of future lettable area.

Gearing level of the Group decreased to 34.9% as at 30 June 2017 (39.4% at 31 December 2016) despite raising of new debt during the first half of 2017.

The portfolio’s strong performance during the first half has allowed the Group to distribute capital of € 20.1 million (€ 1.08 per share) paid to the shareholders on 4 August 2017. In view of the successful and sustainable evolution of the Group’s results, VGP has decided to adopt a formal dividend policy. From 2018 onwards and subject to availability of sufficient distributable reserves and shareholder approval, the Company intends to gradually increase the distribution of dividends over the next 3 years to target an annual distribution between 40% and 60% of its net profit for the year based on its consolidated IFRS financial statements.

[1] Including VGP European Logistics (joint venture with Allianz Real Estate). As at 30 June 2017 the annualised committed leases for VGP European Logistics stood at € 51.3 million compared to € 38.6 million as at 31 December 2016.

 


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