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

Press Release

DIC Asset AG: Results for 2009 exceed forecasts

Frankfurt, 09.03.2010

• Operating profit (FFO) of EUR 47.6 million was above projections
• Stable rental income and real estate valuations
• Consolidated net income of EUR 16.1 million
• Unchanged dividend of EUR 0.30 per share

DIC Asset AG (German Securities ID 509840 / ISIN DE0005098404) today presented its financial statements for the 2009 financial year. The Company performed successfully, in a market environment that continues to be challenging.

FFO (funds from operations, comprising earnings before interest and taxes, plus profits from disposals and development projects) was up by 11 per cent year-on-year, to EUR 47.6 million – in fact exceeding both the original full-year target and the revised forecast of EUR 45-46 million. FFO per share of EUR 1.54 also showed a year-on-year increase (2008: EUR 1.37).

Consolidated net income of EUR 16.1 million reflects DIC Asset AG's sound profitability in the face of prevailing market difficulties. The shortfall compared to the very high figure of EUR 25.2 million for 2008 was due predominantly to lower disposals, reflecting the sluggishness in market transactions. The result is equivalent to earnings per share of EUR 0.52 (2008: EUR 0.80). Shareholders of DIC Asset AG will participate in this successful performance thanks to an unchanged dividend of EUR 0.30 per share – this reflects the stability in operating results.

Detailed review of results for 2009:

DIC Asset AG’s total revenues for the 2009 financial year amounted to EUR 171.3 million (2008: EUR 207.1 million). The decline was largely attributable to the lower volume of sales: at EUR 15.2 million, this fell short of the previous year’s figure by approx. EUR 34.7 million. Stable rental income of EUR 133.6 million (2008: EUR 134.5 million) provided the cornerstone of revenues: contrary to the market trend, the Company rented out 245,500 square metres during 2009, up 25 per cent year-on-year. New rentals in 2009 were equivalent to annualised rental income of EUR 24.8 million (2008: EUR 19.5 million).

DIC Asset AG’s real estate portfolio remained stable, at around 1.3 million m² of floor space with a market value of EUR 2.2 billion market values. The market values, which are reviewed by independent experts each year, declined by 1.6% on a like-for-like basis. At EUR 15.86, NAV per share was slightly lower than the year before (2008: EUR 16.23). Following the marked year-on-year decline seen in 2008 compared to 2007, the trend in 2009 indicates a bottoming-out of the market at large.

DIC Asset’s budgeted expansion of asset and property management activities also led to a budgeted increase in operating costs: administrative expenses for the period rose to EUR 9.0 million (up EUR 1.4 million), whilst staff expenses increased by EUR 2.4 million, to EUR 9.2 million.

DIC Asset AG’s total assets amounted to EUR 2.2 billion as at 31 December 2009. Long-term assets remained stable, at EUR 2.1 billion. Long-term fixed interest rate agreements or hedges are in place for 85 per cent of financial debt of EUR 1.6 billion (unchanged year-on-year), with 53 per cent having a maturity of over four years. Only three per cent of overall financial debt will fall due within the next twelve months. DIC Asset AG significantly reduced interest expenses by approx. EUR 8.4 million, to EUR 74.6 million (based on comparable financing volumes) during the first nine months of 2009, thanks to the optimisation of portfolio finance. Moreover, the Company negotiated a waiver of the original loan-to-value covenant for a EUR 440 million syndicated loan.

Operating profit before depreciation and amortisation (EBDA) of EUR 46.6 million was lower than the EUR 53.2 million figure in 2008, reflecting lower volume of disposals. Cash flow from continuing operations (after interest and taxes paid) rose by EUR 1.5 million year-on-year, to EUR 38.7 million.

New business segment: investment funds

DIC Asset AG has commenced preparations for expanding its business model by a new segment: namely, the management of special investment funds. Attractive properties were selected for the first fund, with an innovative structuring technique developed for this sub-portfolio. DIC Asset AG will retain a minimum holding of 20% in each of the funds. The Company will apply its established asset and property management platform to manage the properties and optimise the portfolio.

DIC Asset AG should further grow its portfolio of profitable, low-risk properties through acquiring additional assets for the funds. The new investment offers will allow DIC Asset AG to explore new investor groups, whilst expanding its investment universe. At the same time, the Company will generate investment income, as well as stable real estate management fees.

Forecast for 2010

DIC Asset AG anticipates the economic environment for the entire real estate sector to remain difficult throughout 2010, with no recovery expected until 2011. The Company is, however, well-prepared for this scenario. Based on conservative estimates, DIC Asset AG expects its results for 2010 to remain positive, with rental income forecast at EUR 126 million, and operating profit between EUR 39 million and EUR 41 million.

Ulrich Höller, Chairman of the Management Board, said that DIC Asset AG exceeded its own projections in 2009, a year marked by crisis, generating solid and attractive results for our shareholders: "DIC Asset AG showed a very stable performance throughout the crisis, against the market trend. With our expansion into managing special funds, we will broaden the scope of our business, to establish an additional attractive source of income that will make a relevant contribution to stable earnings. We continue to envisage attractive buying opportunities, expected to emerge from the second half of 2010. With this in mind, we will be continuously reviewing our capitalisation."

For more information on DIC Asset AG, please visit www.dic-asset.de.

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 includes around 2 million m² of floor space, spread over 318 properties. The portfolio is divided into three segments: the 'Core plus' 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 are placed with third parties following a repositioning under an individual business plan. Real estate assets under management currently amount to approx. EUR 3.2 billion. DIC Asset AG has been included in the SDAX® segment of the Frankfurt Stock Exchange since June 2006.

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