Hamborner Reit Ag

Welcome to the Hamborner Reit Q1 2026 Financial Results Conference Call. For the first part of the conference call, the participants will be in listen-only mode. During the questions and answers session, participants are able to ask questions by dialing pound key 5 on their telephone keypad or clicking the raise your hand icon in the lower right corner in the video player. Now I will hand the conference over to the speakers. Please go ahead.

Good morning, ladies and gentlemen. This is Niklas Karpf for Amborner Reit. Thank you for joining our conference call regarding our figures for the first quarter of 2026. I'm pleased to be here today together with members of our team, including my colleague Christoph from IR. As usual, I will begin with a brief presentation, after which we will open the floor for a Q&A. Everything will run smoothly from a technical standpoint and look forward to engaging with you. Let's start with an overview of the key figures as of 31st of March, 2026. Influenced by our disposals over the past 12 months, the income from rents and leases declined moderately by 1.9%. to 22.6 million Euro in the first quarter. FFO decreased by 1.6% year-on-year and amounted to 11.7 million Euro or 14 cents per share. During the first quarter, financial and portfolio figures overall showed a positive development EPRA, NAD and LTV were positively influenced by the stable revenue and also the earnings development as well as a value adjustment within the property portfolio resulting in a value of €9.27 per share and 43.1% respectively. Operating performance remained resilient, with a vacancy rate and total portfolio vault at solid levels of 3.5% and 5.2 years. As always, we are going to provide more details on the next slides. First of all, a closer look at earnings performance. Yeah, from the management of our properties, income from rent and leases amounted to 22.6 million euros. As noted before, the 1.9% year-on-year decline came primarily due to property disposals completed in the first half of 2025, as well as in the first quarter of this year. In the first quarter, income from ancillary cost allocations increased by 16%, driven by higher prepayments, including effects from the restructuring of our facility management. In contrast, operating expenses rose at a comparatively moderate rate of just 2.1%, which is primarily attributable to the disposal of properties with higher non-recoverable operating costs. Maintenance expenses decreased slightly on the first quarter and amounted to roughly 1.4 million. The costs related to ongoing minor maintenance and various smaller plant measures. As in previous years, major maintenance projects Personal and admin expenses increased by around 5 and 12% respectively. On the one hand, this is due to the expansion of personal capacities and the filling of vacant positions. On the other hand, the rise in admin costs mainly related to our upcoming annual general meeting, where costs, in contrast to the past, have partly been recognized already in the first quarter of the year. Other operating expenses were lower compared to the previous year, influenced by reduced external consultancy costs. Interest expenses slightly decreased in the first three months of 2026, mainly due to the refinancing at higher interest rates in the second half of 2025. Yeah, they increased in the first three months of 2000, first month. On the other hand, the lower interest rates for cash deposits led to lower interest income. Total FFO for the first quarter amounted to 11.7 million or 14 cents, down only 1.6% compared to the previous year period. Next slide, we'll briefly review the development of our portfolio key figures. Following the transfer of the recently sold DIY property in Dissing in the first quarter of this year, our portfolio currently consists of 63 assets. Apart from this disposal, the portfolio development was influenced by a value enhancement of our office asset in Cologne, resulting in a total portfolio value of approximately 1.34 billion as at the end of March. ACRA vacancy rate remained unchanged compared to year end 2025 at a low level of 3.5%. Total portfolio walls, as pointed out before, also remained largely stable at 5.2 years with terms of 6.3 years for the retail and 3.8 years for the office. Concerning rent development, on a year-on-year basis, our like-for-like annualized rental income again increased by 0.8%, primarily driven by indexation effects, especially in the office portfolio. The positive impact of indexation was partly offset by a higher vacancy level and slightly lower rent levels for follow-up leases. which are partly the result of numerous indexation-driven rent adjustments over the past two and a half years. On an annualized basis, the disposals of our properties in Osnabrück and Rübeck last year, as well as the retail asset in Ditzing this year, resulted in a reduction in rental income of 4.1 million euros or 4.5, 4.5 percent. As at the end of March, our annualized rents amounted to €87.8 million. Concerning tenant structure, compared to the end of 2025, only minor changes happened within our tenant structure, primarily driven by index-linked rent adjustments and property disparities. Reit Ag Reit Ag which is shown now on this slide here. Since the beginning of the year, we achieved several letting successes with a total contract volume of nearly 10,000 square meters. As in recent years, the majority of this was attributable to contract extensions and the exercise of options by existing tenants. Once again, reflected in a high retention rate of around 89%. At this stage, Humborner does not expect any major cluster risks in connection with upcoming re-lettings. In the coming years, this is clearly illustrated in the lease expiry schedule shown at the bottom of the slide. On the financing side, our company remains in a very solid position with 43.1%. Our LTV remains at a comfortable level and furthermore within our current target range. Total debt remains largely stable, slightly below 640 million euros. The average interest costs slightly increased to 2.2%. following our refinancing activities over the last three quarters. As we are currently tending to opt for shorter loan terms between three and seven years, the average term has been slightly reduced to three years. Further, debt metrics also remained largely stable with net debt EBITDA ratio at a level below 10. and an interest coverage ratio of 4.5. Regardless of the still challenging financing environment, the high quality of our portfolio and our extensive and reliable network of banks give us confidence in our ability to successfully complete the financing tasks ahead. And finally, I would like to give a brief outlook. The company's NGO general meeting will take place in early June. We propose to distribute 65% of our operating income generated in 2025, which corresponds to a dividend of 39 cents per share. To date, our operational performance has been in line with plans. We are optimistic about the remainder of the year and confirm our current full year guidance. Our rental income for the full year 2026 is expected to be between 87.5 and 89.5 million euro. And our assumption for the FFO range between 38 and 42 million. The operating result will be influenced in particular by the cost development in the areas of maintenance, personal expenses, and interest. And with regard to these cost categories, we will continue to act with high discipline and try to achieve a balance between current financial burdens and securing future growth and cash flow prospects. Regardless of the recently announced strategic adjustments, which include a growth focus on retail properties, a widened acquisition profile, as well as a reduction concerning our office exposure, our guidance currently does not take into account any further transactions. We have recently started sales activities for the first office properties and are simultaneously examining further acquisition opportunities. However, based on the current outlook, we expect potential transactions to have only a minor impact on this year's revenue and earnings development. We'll keep you informed on our progress and, if necessary, update our guidance during the course of the year. And with that, ladies and gentlemen, I would like to conclude the short presentation and open the floor for your questions. Thanks so much for now for your attention.

If you wish to ask a question, please dial the pound key followed by 5 on your telephone keypad or click the raise your hand icon in the lower right corner of the video player to enter the queue. To withdraw your question, Reit Ag The next question comes from Thomas Whistler from MWB Research Ag. Please unmute your microphone.