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ePaper created 2014-04-29, 17:58:02 | version 1.30.00
DEUTSCHEEUROSHOPANNUALREPORT2013/GROUPMANAGEMENTREPORT 129 Consequently, global demand for capital investments that retain their value remains strong, particularly in financially strong countries such as Germany. With interest rates low, life insurance companies in par- ticular are still seeking real estate investment opportunities that will meet the long-term expectations of policyholders. This is keeping demand for real estate at record levels, in contrast to a merely limited supply side. Retail property in particular remains attractive to many institutional investors, leading to very high transaction prices and cor- respondingly low anticipated returns for core properties. We monitor developments on the real estate market closely. As in the past, we will only make new investments if the return that is achievable over the long term bears a reasonable relation to the investment risks. OUTLOOK GOOD FOR OUR SHOPPING CENTERS We predict that our shopping centers will continue to perform well. The occupancy rate across all our shopping centers is currently expected to remain at around 99%. At the end of 2013, the occupancy rate for all types of space was 98.6%, on a par with 2012 (98.6%). The occupancy rate for retail space stood steady at 99.5%. The remaining vacancies consisted largely of office and storage space. Outstanding rents and necessary valuation allowances remain stable at a low level. We see no sign of a significant change in this satisfac- tory situation. AGREED TRANSACTIONS ARE THE FOUNDATION FOR REVENUE AND EARNINGS PLANNING The Deutsche EuroShop Group’s revenue and earnings planning for 2014 and 2015 does not include the purchase or sale of any proper- ties. The results of the annual valuation of our shopping centers and exchange rate factors are not included in our planning since they are not foreseeable. Forecasts about the future revenue and earnings situation of our Group are based on the following factors: a) the development of revenue and earnings in the existing shopping centers b) the assumption that there will be no substantial reduction in sales in the retail sector that would prevent a large number of retailers from meeting their obligations under existing leases. REVENUE SET TO RISE BY 6% IN 2014 We anticipate that revenue will increase by around 6% to between €198 and €201 million in the 2014 financial year. The figures will be boosted by revenue from the Altmarkt-Galerie, which will be included in the full-year figures for the first time. In the 2015 financial year, revenue is likely to rise slightly to between €202 million and €205 million. FURTHER GROWTH IN EARNINGS IN THE NEXT TWO YEARS Earnings before interest and taxes (EBIT) amounted to €165.8 million in 2013. According to our forecast, EBIT will come in at between €174 million and €177 million (up 6%) in the current financial year. EBIT should increase again to between €177 million and €180 million in 2015 (up 2%). Earnings before tax after adjustments for the exceptional proceeds from the sale of Galeria Dominikanska in Breslau (EBT excluding valuation gains) came to €113.4 million. We expect to achieve EBT of between €120 million and €123 million in 2014 (an increase of 7%) and €125 to €128 million in 2015 (up 4%). FFO UP SLIGHTLY Funds from operations (FFO) amounted to €2.08 per share in the year under review. We expect this figure to come to between €2.14 and €2.18 in 2014 (+4%) and between €2.20 and €2.24 (+3%) in 2015. DIVIDEND POLICY We intend to maintain our long-term, reliable dividend policy and anticipate that we will be able to pay dividends at €1.30 per share in 2014 and €1.35 in 2015 to our shareholders. REVENUE € MILLION EBIT € MILLION EBT € MILLION excluding valuation FFO € per share 2013 2014 2015 Earnings 188.0 Target 198–201 Target 202–205 2013 2013 20132014 2014 20142015 2015 2015 Earnings 165.8 Earnings 113.4 Earnings 2.07 Target 174–177 Target 120–123 Target 2.14–2.18 Target 177–180 Target 125–128 Target 2.20–2.24 * Adjusted for sale proceeds