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Financing

IMMOFINANZ’s financing strategy is designed to ensure sufficient liquidity at all times, to achieve and maintain a balanced composition and maturity profile for the capital structure and to optimise financing costs. The best possible structuring of debt financing is an important priority and, in addition to successful property management, is a decisive factor for the results generated by IMMOFINANZ’s business activities.

EXCLUDING SUBSCRIPTION RIGHTS FOR THE ISSUE OF CONVERTIBLE BONDS

Report of the Management Board of IMMOFINANZ AG on excluding subscription rights for the issue of convertible bonds, as authorised by the resolution adopted at the 22nd Annual General Meeting of IMMOFINANZ AG of 1 December 2015. Please find the details in the PDFs below:

Download: Report on excluding subscription rights for the issue of convertible bonds, 23 December 2016 (476,43 kB, PDF)
Download: Report on excluding subscription rights for the issue of convertible bonds, 20 April 2016 (136,45 kB, PDF)

Financing in the 2017 financial year

Financing with a total volume of EUR 1.6 billion was refinanced in 2017. That represents approximately 60.0% of the total financial liabilities from the Group’s continuing operations as of 31 December 2017 and involves extensions as well as new financing.

In the area of property financing, the strategic combination of individual properties in a particular brand or asset class into specific portfolios led to the realisation of more attractive conditions. Specific examples include the refinancing of STOP SHOP retail parks in eight countries through several portfolio financing transactions with a volume of over
EUR 414.1 million and the refinancing of an office property portfolio in Warsaw with a volume of EUR 205.0 million.

At the Group level, the volume of outstanding bonds with historically high interest rates was substantially reduced through multi-stage refinancing and redemptions. These transactions reduced the total outstanding nominal volume of the bonds to approximately EUR 330.0 million (31 December 2016: EUR 628.5 million), whereby roughly
EUR 32.8 million are attributable to the convertible bond 2018 which expired in March 2018. The only bond currently outstanding is the convertible bond issued in January 2017, which has a volume of EUR 297.2 million, a term ending in 2024 and a coupon of 2.0%*.

Cash and cash equivalents, including cash held for sale (IFRS 5), totalled EUR 479.3 million as of 31 December 2017, and financial liabilities amounted to EUR 2.6 billion (31 December 2016: EUR 2.8 billion). Net debt, i.e. debt after the deduction of cash and cash equivalents held by the Group, equalled EUR 2.1 billion (31 December 2016: EUR 2.6 billion).

* Coupon reduction of 50 basis points on receipt of an investment grade rating

Robust balance sheet structure

IMMOFINANZ has a robust balance sheet structure with an equity ratio of 46.3% (31 December 2016: 37.8%) and a net loan-to-value ratio (net LTV) of 40.8% (31 December 2016: 49.0%).

The net LTV shows the carrying amount of financing less cash and cash equivalents in relation to the total carrying amount of the properties, the market value of the investment in BUWOG shares and the EPRA net asset value (EPRA NAV) of the investment in CA Immobilien Anlagen AG (CA Immo).

Reduction of financing costs

Financing costs declined to EUR 94.9 million in 2017 (2016*: EUR 110.0 million). The average financing costs for IMMOFINANZ equalled 2.31% per year as of 31 December 2017 (31 December 2016: 3.02% per year) including the derivatives used for interest rate hedging and 1.97% per year (31 December 2016: 2.64% per year) excluding the derivatives used for interest rate hedging.

The average financing costs for the standing investments amount to 2.00% per year excluding derivatives and 2.51% per year including derivatives.

Unencumbered properties

In addition to properties which carry external financing and are encumbered through standard market collateral (e.g. mortgages, pledge of company shares), EUR 846.1 million, or 19,0%, of the total property carrying amount was not externally financed and therefore unencumbered as of 31 December 2017 (31 December 2016: EUR 755.2 million or 13.9%). The unencumbered standing investments have a combined carrying amount of EUR 566.7 million or 16.1% (31 December 2016: EUR 312.2 million or 9.44%).

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