FCR Immobilien - Termination of coverage

Edison Investment Research is terminating coverage on China Water Affairs Group (855), CREALOGIX Group (CLXN), FCR Immobilien (FC9), HarbourVest Global Private Equity (HVPE), Marble Point Loan Financing (MPLF), Paion (PA8), PDL Biopharma (PDLI), Redhill Biopharma (RDHL) and Targovax (TRVX). Please note you should no longer rely on any previous research or estimates for these companies. All forecasts should now be considered redundant.

FCR Immobilien - Seeking new funding to grow its portfolio

FCR Immobilien held a real estate portfolio worth c €312m at end-June 2020 (with retail properties making up 76%). Rental income (including hotel revenue) improved by c 30% y o y to €12.5m in H120, supported by H219 acquisitions. Management now guides to a rental and hotel revenue increase of 31% y-o-y to €28.3m in FY20 (not accounting for further acquisitions). Moreover, it expects a property disposal volume of at least €30m this year, which implies a strong pick-up in activity in H220 vs H120.

FCR Immobilien - Rental income improves on growing portfolio

Between H119 and H120 FCR Immobilien expanded its real estate portfolio from 64 properties to 83, with most properties added in H219. Consequently, its rental income (including hotel revenue) improved by c 30% y o y to €12.5m in H120. Management now guides to a rental and hotel revenue increase of 31% y-o-y to €28.3m in FY20 (not accounting for further property acquisitions). Moreover, it expects a property disposal volume of €30–40m this year, which implies a strong pick-up in activity in H220

FCR Immobilien - Rental income improves on growing portfolio

Between H119 and H120, FCR Immobilien expanded its real estate portfolio from 64 properties to 83, with most properties added in H219. Consequently, its rental income (including hotel revenue) improved by c 30% y o y to €12.5m in H120. Management now guides to a rental and hotel revenue increase of 31% y-o-y to €28.3m in FY20 (not accounting for further property acquisitions). Moreover, it expects a property disposal volume of €30–40m this year, which implies a strong pick-up in activity in H220

FCR Immobilien - Seeking new debt funding to grow portfolio

FCR Immobilien (FCR) reported positive funds from operations (FFO1) in Q120 on the back of portfolio expansion (driving rental income) and lower debt costs. Its EBITDA growth was further supported by gains from a few property disposals. According to the company, rental deferrals as a result of the COVID-19 lockdown for April and May reached €250k and we expect further deferrals to be relatively limited given the easing of restrictions and gradual rebound in retail customer traffic in Germany. Th

FCR Immobilien - Maintaining good momentum in FY19

FCR Immobilien (FCR) maintained its growth path in FY19, with EPRA NAV per share up by c 22% y-o-y and annualised net rental revenue generated by its portfolio of €19.5m (up 32% y-o-y). Consequently, we estimate that it was able to deliver a NAV total return (TR) per share of around 24% despite the dilutive impact of last year’s share issue. Management remains committed to further portfolio expansion, with a target of €400–450m asset value, which may require additional external funding, eg throu

FCR Immobilien - Maintaining good momentum

FCR Immobilien (FCR) maintained its growth path in FY19, with EPRA NAV per share (based on preliminary numbers) up by c 22% y-o-y and annualised net rental revenue generated by its portfolio of €19.5m (up 32% y-o-y). Consequently, we estimate that it was able to deliver a NAV total return (TR) per share of around 24% despite the dilutive impact of last year’s share issue. Management remains committed to further portfolio expansion, with a 2020 target of €500m asset value, which may require addit

FCR Immobilien - High-growth German property investor

FCR Immobilien (FCR) invests mainly in retail property, targeting total returns derived from recurring rental income and capital gains. The company seeks to acquire properties at attractive prices and actively manages the assets to improve income, by reducing voids and increasing rent levels and capital values with minimal or no capex. A key element of FCR’s strategy is to sell properties where asset management plans are mature, with capital recycled into new opportunities. Consequently, gains o

FCR Immobilien - Progressing with portfolio expansion agenda

FCR Immobilien consistently implements its growth strategy of increasing its market penetration in the German retail property market coupled with selective, rental-oriented expansion in other real estate segments. As a result, its portfolio at end-September 2019 reached 71 properties with a leasable floorspace of 324k sqm (vs 58 properties and 248k sqm at end 2018). Consequently, the annualised rental revenue of FCR’s portfolio reached €17.1m (vs €14.8m at end-2018). Further acquisitions have be

FCR Immobilien - Progressing with portfolio expansion agenda

FCR consistently implements its growth strategy of increasing its market penetration in the German retail property market coupled with selective, rental-oriented expansion in other real estate segments. As a result, its portfolio at end-June 2019 reached 64 properties with a leasable floorspace of 306k sqm (vs 58 and 248k sqm, respectively, at end-2018). A further seven retail properties were acquired post reporting date. Consequently, FCR’s portfolio is now generating a rental income of more th

FCR Immobilien - Sustained high transaction activity

FCR continues to grow its property portfolio which, at 29 May 2019, represents lettable floor space of c 261,500 sqm compared to 175,000 at end-2017. To facilitate this growth, the company recently launched a new €30m bond issue and a share capital increase. FCR deploys its targeted higher leverage at property level, with the bank liabilities to book value of properties ratio at c 67% at end-2018. Meanwhile, it also managed to achieve a solid aggregate return of 32.3% on nine property disposals

FCR Immobilien - High-growth German property investor

FCR Immobilien has demonstrated rapid portfolio expansion over the last several years. It has been able to monetise attractive buying opportunities, as illustrated by both the high average rental income yield (11.7% as at end-September 2018) and a solid average return on disposals in 2017 and 2018 ytd at c 28% pa (our estimate excludes rental income). High leverage has been part of this strategy, with net debt to total assets at 72% at end-June 2018 (and likely to increase further) vs the peer a

Morning Note – 22 April 2024

Benefits of scale set to materialise

Frenkel Topping - Resilient with strong growth potential

FY 2023 was a challenging year for Frenkel with higher interest rates encouraging clients to place money into lower margin money market funds. Despite this, sales grew +32% (supported by recurring revenue +9% and +51% in non-recurring), EBIT margins remained strong at 22% and adj. EPS grew +17% (taking into account the higher number of shares). FY 2024 has seen a solid start to transactional business and there is a strong pipeline of new FUM opportunities both of which support further growth. Wi

S&U - PBT ahead, encouraging volume trends

S&U reported FY24 PBT of £33.6m, down from £41.4m in FY23 on higher funding and regulatory costs and higher impairments in Advantage in H2. PBT was 2% ahead of our forecast as stronger revenues – up 12% to £115.4m – and better costs offset higher-than-expected impairments. Net receivables grew to a record at both Advantage and Aspen and management noted particular strength in Q4 and a good trading environment in the current year. Having absorbed a significant rise in funding cost as well as addi

Hardman & Co Insight: 2023 was an annus horribilis for Quoted UK Infrastructure and Renewable Energy

The focus of Hardman & Co Research is on the nine quoted Infrastructure Investment Companies (IICs) and on the 22 Renewable Energy Infrastructure Funds (REIFs): the stocks analysed are all members of the Association of Investment Companies (AIC). We are updating our publication of January 2023, assessing both the lacklustre share price performances during 2023 and the key issues, including interest rates, inflation and power prices. As a 31-strong group, its combined market capitalisation is no

Foresight Solar Fund - Termination of coverage

Edison Investment Research is terminating coverage on ABC Arbitrage (ABCA), paragon (PGN), Foresight Solar Fund (FSFL), Kendrion (KENDR), Lithium Power International (LPI), Triple Point Energy Transition (TENT), 4iG (4IG), e-therapeutics (ETX), Pharnext (ALPHA) and Shield Therapeutics (STX). Please note you should no longer rely on any previous research or estimates for this company. All forecasts should now be considered redundant. Previously published reports can still be accessed via our web

LIBERUM: PayPoint: On track for £100m of EBITDA in FY 26

Regional REIT - Performing as expected ahead of refinancing

In a challenging market, Regional REIT’s (RGL’s) FY23 operational and financial performance was robust, in line with expectations and previous guidance. Investor focus remains on the company’s loan to value (LTV) reduction and bond refinancing plans, explored in detail in our previous note and RGL will provide an update on this in due course.

LIBERUM: Speedy Hire: Weakness in FY 24 but recovery in FY 25

Hybridan Small Cap Feast - 22 April 2024

22nd April 2024 * A corporate client of Hybridan LLP ** Arranged by type of listing and date of announcement *** Alphabetically arranged **** Potential means Intention to Float (ITF) has been announced Dish of the day Admissions: Delistings: What’s baking in the oven? ** Potential**** Initial Public Offerings: Reverse Takeovers: 16 April 2024: Electric Guitar (ELEG.L) Concurrent with its Admission to trading on AIM, Electric Guitar is proposing to acquire the entire issued share capital of 3radi

The Hardman & Co Monthly: April 2024

Feature article: Steady as she goes, but could be better: A review of investment company liquidity since 2016 Liquidity is the lifeblood of equity markets. The measurement of liquid asset availability to a market or company is a way of gauging a market’s health. This article builds on our previous work, which analysed the liquidity data for non-financial trading companies, by applying the same analytical techniques to the investment companies (IC) space. We analyse liquidity for ICs as a whol

Foxtons Group (FOXT LN) - 1Q24 IMS shows real momentum

Foxtons Group plc first quarter revenue rose 9% to £35.7m (1Q23: £32.9m) with growth delivered across all business segments. Trading is in line with management's expectations.

H&T Group (HAT): Core franchise build, short-term retail noise

In our 15 March 2023 initiation, 'Pawnbroking royalty, with strong, profitable growth', and subsequent notes, we have highlighted the strong market for pawnbroking and why H&T, as the market leader, is uniquely placed to take advantage of these opportunities. These results reconfirmed both, with the pledge book up 28% and net pawnbroking revenue up 36%. Like many in the retail space, H&T faced the challenge of customers focusing on lower-value, lower-margin items in the key run-up to Christmas 2

Morning Note – 29 February 2024

Hardman & Co Insight - Asset managers had a poor 2022

Asset managers had a poor 2022: the S&P Composite 1500 Asset Management Index was down 22% and, according to the Investment Company Institute (ICI), worldwide mutual funds fell by 20%, from $76tr to $60tr. When bond and equity markets fall, the results are unlikely to be pretty: with revenues trending down and multiples contracting, there is a double whammy to contend with. So how do valuations shape up now, after a bullish start to the new year? The first chart is my favourite chart of asset m