Aroundtown SA announces H1 2018 results with increased profitability and continued growth

THIS ANNOUNCEMENT IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, CANADA, AUSTRALIA, JAPAN, SOUTH AFRICA OR ANY OTHER JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF APPLICABLE LAWS OR REGULATIONS

AROUNDTOWN ANNOUNCES H1 2018 RESULTS
WITH INCREASED PROFITABILITY AND CONTINUED GROWTH

- Net rental income of EUR291 million, increased 43% from EUR204 million in H1 2017

- Adjusted EBITDA up 44% to EUR280 million

- FFO I growth of 46% to EUR189 million from EUR130 million

- FFO I per share increased to EUR0.19 (6% YOY) EUR0.38 on annualized basis

- FFO I per share after perpetual notes attribution of EUR0.17 (6% increase YOY)

- Net profit of amounted to EUR970 million, representing YOY growth of 25%Successful growth with over EUR1.4bn of acquisitions of mainly office and hotel

- Fully diluted EPS up to EUR0.82 (11% YOY)

- EPRA NAV up by 22% to EUR7.9 billion and EUR7.2 per share, up 14% adjusted for dividends (11% net of dividend paid)

- EPRA NAV incl. perpetual notes growth of 24% to EUR9.5 billion from EUR7.7 billion; EUR8.6 per share

- Equity growth of 18% to EUR8.5 billion and EUR8.8 billion assuming conversion of convertible bonds.

- Investment property grew 21% to EUR11.9 billion, from EUR9.8 billion year-end 2017

- LTV maintained low at 37% and 35% assuming conversion of deep-in-the-money convertible bonds

- Solid credit profile and conservative financing structure sustained with ICR of 4.7x, low cost of debt of 1.7%, long average debt maturity of 7.4 years and high unencumbered ratio of 71% (EUR8.5 billion)

- Robust organic growth is reflected in solid net rental income like-for-like gains of 4.6%, 2.5% from in-place rent growth and 2.1% from occupancy increase

29 August 2018.

Higher profitability as a result of strong operational performance

Aroundtown (the 'Company' or 'AT') announces its H1 2018 with higher profitability from high internal growth, reflected in a 4.6% growth on a like-for-like basis from rent and occupancy increases, and high asset quality resulting in a profit growth of 25% to nearly EUR1 billion in the first six months of 2018. The high scale of operational growth is further demonstrated by an increase in FFO I of 46% YOY. H1 2018 annualized FFO I of EUR379 million and EUR0.38 per share reflects an FFO I yield of 5% and dividend yield of 3.3%, which illustrates AT's robust performance results in continuous growth on a per share basis. Higher shareholder value generation is also evident in the EPRA NAV per share growth to EUR7.2 per share +14% since Dec 2017 adjusted for dividend, +11% net of dividend paid.

High quality portfolio, supported by sizable external growth of assets in top tier cities

AT continued its successful growth with over EUR1.4bn of acquisitions of mainly office and hotel assets offering high value-add potential in fundamentally strong cities, such as Berlin, Frankfurt, Munich, Stuttgart, London, Utrecht and Rotterdam. Additions in the hotel portfolio with two high quality assets in Berlin and London exhibit the strength of AT's quality portfolio: Hilton Berlin Gendarmenmarkt is a landmark asset encompassing an entire city block in the best location in Berlin and Hilton Hyde Park is a monumental assets overlooking the Hyde Park in the heart of London. Further building on its accretive capital recycling strategy, AT successfully disposed year-to-date over EUR700 million of non-core assets of which EUR500 million have been sold in H1 2018 at 15% above net book value and at a 28% disposal margin over cost. Further EUR235 million of disposals of non-core assets have been finalized after the reporting period. Disposals during H1 2018 led to an increase in FFO II of 93% to EUR300 million.

Maintaining the conservative capital structure

LTV remained low at 37% and 35% assuming conversion of deep-in-money convertible bonds. After the reporting date, another EUR105 million of convertible bonds have been submitted for conversion, thus resulting in 49% of the EUR300 million Series C bonds being converted. AT's proactive approach reinforced its financial stability by sustaining low average cost of debt of 1.7% and long average debt maturity of 7.4 years.

The H1 2018 financial report is available on the Company's website:
http://www.aroundtown.de/investor-relations/publications/financial-reports/

For definitions and reconciliations of the Alternative Performance Measures, please see the relevant sections in the pages 56-59 of the H1 2018 financial statements. You can find the financial statements in AT's website under Investor Relations > Publications > Financial Reports or under this link: https://www.aroundtown.de/fileadmin/user_upload/04_investor_relations/downloads/2018/AT_H1_2018.pdf

About the Company

Aroundtown SA (symbol: AT1), trading on the Prime Standard of the Frankfurt Stock Exchange, is the largest listed and highest rated (BBB+ by S&P) German commercial real estate company.
Aroundtown invests in income generating quality properties with value-add potential in central locations in top tier European cities mainly in Germany/NL.
Aroundtown SA (ISIN: LU1673108939) is a public limited liability company (société anonyme) established under the laws of the Grand Duchy of Luxembourg, registered with the Luxembourg Trade and Companies Register (Registre de Commerce et des Sociétés, Luxembourg) under number B217868, having its registered office at 1, Avenue du Bois, L-1251 Luxembourg, Grand Duchy of Luxembourg.

Contact

Timothy Wright

T: +352 285 7741

E: info@aroundtown.de

www.aroundtown.de

DISCLAIMER

THIS ANNOUNCEMENT DOES NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY ANY SECURITIES.

THE SECURITIES MENTIONED IN THIS ANNOUNCEMENT HAVE NOT BEEN, AND WILL NOT BE, REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE SECURITIES ACT), AND MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES ABSENT REGISTRATION OR AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT. THERE WILL BE NO PUBLIC OFFERING OF THE SECURITIES IN THE UNITED STATES.

THIS ANNOUNCEMENT IS DIRECTED AT AND IS ONLY BEING DISTRIBUTED IN THE UNITED KINGDOM TO (I) PERSONS WHO HAVE PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS FALLING WITHIN ARTICLE 19(5) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005 (THE ORDER), (II) HIGH NET WORTH ENTITIES, AND OTHER PERSONS TO WHOM IT MAY OTHERWISE LAWFULLY BE COMMUNICATED FALLING WITHIN ARTICLE 49 OF THE ORDER, AND (III) PERSONS TO WHOM IT MAY OTHERWISE LAWFULLY BE COMMUNICATED (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS RELEVANT PERSONS). THIS COMMUNICATION MUST NOT BE READ, ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS. ANY INVESTMENT OR INVESTMENT ACTIVITY TO WHICH THIS ANNOUNCEMENT RELATES IS AVAILABLE ONLY TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS.

IN MEMBER STATES OF THE EUROPEAN ECONOMIC AREA (EEA), THIS ANNOUNCEMENT AND ANY OFFER IF MADE SUBSEQUENTLY IS DIRECTED ONLY AT PERSONS WHO ARE 'QUALIFIED INVESTORS' WITHIN THE MEANING OF ARTICLE 2(1)(E) OF DIRECTIVE 2003/71/EC, AS AMENDED (THE PROSPECTUS DIRECTIVE) (QUALIFIED INVESTORS). ANY PERSON IN THE EEA WHO ACQUIRES THE SECURITIES IN ANY OFFER (AN INVESTOR) OR TO WHOM ANY OFFER OF THE SECURITIES IS MADE WILL BE DEEMED TO HAVE REPRESENTED AND AGREED THAT IT IS A QUALIFIED INVESTOR. ANY INVESTOR WILL ALSO BE DEEMED TO HAVE REPRESENTED AND AGREED THAT ANY SECURITIES ACQUIRED BY IT IN THE OFFER HAVE NOT BEEN ACQUIRED ON BEHALF OF PERSONS IN THE EEA OTHER THAN QUALIFIED INVESTORS, NOR HAVE THE SECURITIES BEEN ACQUIRED WITH A VIEW TO THEIR OFFER OR RESALE IN THE EEA TO PERSONS WHERE THIS WOULD RESULT IN A REQUIREMENT FOR PUBLICATION BY AROUNDTOWN OR ANY OF THE MANAGERS OF A PROSPECTUS PURSUANT TO ARTICLE 3 OF THE PROSPECTUS DIRECTIVE.

THIS ANNOUNCEMENT MAY CONTAIN PROJECTIONS OR ESTIMATES RELATING TO PLANS AND OBJECTIVES RELATING TO OUR FUTURE OPERATIONS, PRODUCTS, OR SERVICES, FUTURE FINANCIAL RESULTS, OR ASSUMPTIONS UNDERLYING OR RELATING TO ANY SUCH STATEMENTS, EACH OF WHICH CONSTITUTES A FORWARD-LOOKING STATEMENT SUBJECT TO RISKS AND UNCERTAINTIES, MANY OF WHICH ARE BEYOND THE CONTROL OF AROUNDTOWN SA. ACTUAL RESULTS COULD DIFFER MATERIALLY, DEPENDING ON A NUMBER OF FACTORS.