^
Original-Research: UBM Development AG - from NuWays AG
Classification of NuWays AG to UBM Development AG
Company Name: UBM Development AG
ISIN: AT0000815402
Reason for the research: Update
Recommendation: Kaufen
from: 12.04.2024
Target price: EUR 28.00
Target price on sight of: 12 Monaten
Last rating change:
Analyst: Philipp Sennewald
Remaining in pole position for market reopening / chg.
UBM released final FY 2023 results which were in line with the preliminary
figures published in March. FY sales came in at EUR 85.3m (eNuW: EUR 87.9m),
implying a yoy decline of 36%. This is again mainly explained by the
ongoing weakness of the real estate transaction market, which reached its
lowest point since 2010 with a transaction volume of only EUR 29bn in Germany
(-56% yoy). Hence, sales from property disposals almost halved yoy,
amounting to EUR 48.2m (2022: EUR 85.2m), mainly driven by the disposal of the
34% share in Palais Hansen (Hotel), a non-core disposal in the Czech
Republic as well as the ownership transfer of F.A.Z tower to HMG. FY EBT
came in at EUR -39.4m, which was partly due to negative operating leverage
but mainly caused by property write-downs to the tune of EUR 70m, resulting
from the weak market environment as well as increased discount rates
setting off increasing rent levels.
In recognition of the net loss, management will recommend to the AGM to
waive the dividend as a "precautionary measure". Yet, CEO Winkler
reiterated in yesterday's CC that this does not change the overall
policy and that the company will return to be a reliable source of
dividends once profitability is regained.
While management provided no guidance for 2024 yet due to the continued
lack of visibility in the market, it clearly indicated that the main focus
will be on the execution of the timber pipeline (75% of its EUR 2.3bn
pipeline), with the main goal of full letting and disposing the Timber
Pioneer, as well as cash management. Regarding the latter, UBM will
intensify the disposal of non-strategic, mostly standing, assets (EUR 480m
total BV) in order to strengthen the liquidity position (EUR 152m cash at YE
'23). Here, management stated that it already made good progess and is
expecting first disposal sucesses in H1.
Overall, we continue to consider UBM to be well positioned for the pending
reopening of the transaction market thanks to its clear focus on Taxonomy
compliant hybrid-timber developments. However, the market upturn has so far
failed to materialize, which, coupled with continuous outflows at real
estate mutual funds, is indicating a slow and steady recovery rather than a
rapid upswing. We hence remain cautious regarding '24e, modelling a 50%
likelihood of a Timber Pioneer disposal as well as some smaller disposals
of non-core assets.
We reiterate BUY with an unchanged PT of EUR 28 based on DDM.
You can download the research here:
http://www.more-ir.de/d/29391.pdf
For additional information visit our website
www.nuways-ag.com/research.
Contact for questions
NuWays AG - Equity Research
Web: www.nuways-ag.com
Email: research@nuways-ag.com
LinkedIn: https://www.linkedin.com/company/nuwaysag
Adresse: Mittelweg 16-17, 20148 Hamburg, Germany
++++++++++
Diese Meldung ist keine Anlageberatung oder Aufforderung zum Abschluss bestimmter Börsengeschäfte.
Offenlegung möglicher Interessenskonflikte nach § 85 WpHG beim oben analysierten Unternehmen befinden sich in der vollständigen Analyse.
++++++++++
-------------------transmitted by EQS Group AG.-------------------
The issuer is solely responsible for the content of this research.
The result of this research does not constitute investment advice
or an invitation to conclude certain stock exchange transactions.
°
