The DIC Group is one of the leading investors in the German market for commercial real estate

Press Release

DIC Asset AG publishes results for 2006: strong growth with sound profitability

Frankfurt, 29.03.2007

DIC Asset AG (German Securities ID 509840 / ISIN DE0005098404) today presented its financial statements for the 2006 financial year. The results clearly show that DIC succeeded in maintaining its growth momentum, together with continued high profitability and based on a sound earnings base.

DIC Asset AG significantly expanded its presence throughout Germany during 2006, having acquired 200 properties involving total investments of around Euro 1.5 billion. The company’s total assets significantly exceeded the one billion euro mark at the year-end, amounting to Euro 1.34 billion (31 Dec 2005: Euro 370 million). DIC Asset AG commissioned external surveyors to conduct a market valuation. The survey, which was carried out as at 31 December 2006, substantiates a net asset value per share of Euro 21.34 (2005: Euro 13.98). The added value (comparing the book value to the market value) of properties held (including participations) increased by Euro 46.9 million to Euro 71.0 million, which is also reflected in the net asset value.

Total revenues for 2006 were Euro 67.8 million higher than during the previous year, at Euro 110.9 million (2005 Euro 43.1 million). Rental income was up strongly, by Euro 20.3 million (up 90 per cent) to Euro 38.4 million, mainly as a result of the significant expansion in the real estate portfolio: floor space tripled since the end of 2005, to more than 730,000 m2. In this context, purchases of properties carried out during the second half of 2006 were only partially taken into account.

At the same time, total expenses grew to Euro 82.4 million (2005: Euro 28.4 million). This increase – which was fully in line with projections – was due to the significant expansion in operating activity, and to the growth in the real estate portfolio (Euro 1.3 billion in 2006, compared with Euro 340 million in 2005).

EBITDA (earnings before interest, income taxes, depreciation and amortisation) doubled to Euro 37.0 million (2005: Euro 18.7 million), At Euro 40.5 million, cash generated from operations nearly tripled from the previous year.

FFO (Funds From Operations, calculated as earnings before interest and taxes, profits from disposals and development projects, and investment income) tripled to. Euro 21.8 million, an increase of approx. Euro 14.4 million (2005: Euro 7.4 million). EBTDA (earnings before taxes and depreciation) was up Euro 16.4 million, to Euro 28.4 million (2005: Euro 8.1 million). Profit for the period (after deduction of depreciation and taxes) for the year doubled to Euro 15.0 million (2005: Euro 6.4 million). Earnings per share remained virtually unchanged at the high level of 2005, at Euro 0.85 (2005: Euro 0.87) despite the capital increases.

The Management Board will propose to the Annual General Meeting to increase the dividend to Euro 0.75 per share, a 34 per cent increase compared to 2005 (Euro 0.56 per share). In the company’s view this dividend reflects adequately the successful operative results in 2006. With this proposal DIC Asset AG continues its dividend policy, offering a high dividend payment rate.

The DIC Asset AG share price also reflected this pronounced expansion during 2006, outperforming its benchmarks: its 67.9 per cent gain puts the share well ahead of the SDAX (+31 per cent outperformance) and the EPRA/NAREIT Europe index (+48 per cent), the benchmark index for European real estate issues.

Two capital increases carried out during 2006 supported DIC Asset AG’s strategic expansion, placing altogether Euro 400 million for future growth. The free float increased from below 5 per cent at the end of 2005 to currently 55 per cent.

To manage its Euro 2.1 billion portfolio in as efficient and tenant-friendly manner as possible, DIC Asset AG has with DIC ONSITE established a asset management platform with own offices in Frankfurt, Mannheim, Dusseldorf, Hamburg and Berlin. The strategic nation-wide network is the base for further qualitative growth.

Based on its current portfolio, DIC Asset AG plans to more than double its profit once again in 2007. This will be supported by active asset and property management, together with realised profits from regular sales of real estate. On this base the company expects earnings (after depreciation and taxes) of Euro 32 to 35 million.

Ulrich Höller, Chairman of the Management Board of DIC Asset AG, looked back on 2005, when the company “had concluded the first stage of its strategy by establishing DIC Asset AG and getting the business ready for the IPO. This was followed by the second strategic step in 2006: a strong expansion, which resulted in the company’s inclusion in the SDAX index. 2007 will see the third stage of our strategy. This will be characterised by significant market penetration, which we will achieve by way of further acquisitions of profitable properties worth up to a billion euros. This will create the prerequisites for admission into the MDAX on a medium-term horizon. Having integrated DIC ONSITE, we have built the optimum foundation for future growth in terms of asset and property management.”

About DIC Asset AG
Established in 2002, DIC Asset AG, with registered offices in Frankfurt/Main, is a real estate company with a dedicated investment focus on commercial real estate in Germany, pursuing a return-oriented investment policy. DIC Asset AG’s real estate portfolio currently includes around 785,000 sqm of floor space, spread over 262 properties. The portfolio is divided into three segments: the Core portfolio includes the proprietary portfolio held on a long-term basis and offering stable, attractive rental yields; the Value-Added portfolio contains real estate with promising performance potential over the medium term; while the Opportunistic Co-Investments portfolio is comprised of real estate investments that have a more pronounced risk/return profile, which will be placed with third parties following a repositioning under an individual business plan. Real estate assets under management currently amount to approx. Euro 2.1 billion. DIC Asset AG has been included in the SDAX® segment of the Frankfurt Stock Exchange since June 2006.

<< back