Original-Research: Coreo AG (von GBC AG): BUY
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Original-Research: Coreo AG - von GBC AG
Einstufung von GBC AG zu Coreo AG
Unternehmen: Coreo AGISIN: DE000A0B9VV6
Anlass der Studie: Research Note Empfehlung: BUY Kursziel: 2.35 EUR Kursziel auf Sicht von: 31/12/2021 Letzte Ratingänderung: Analyst: Cosmin Filker; Marcel Goldmann
Extensive acquisition pipeline available, Further strong sales and earnings growth from 2021 on expected; target price: EUR 2.35, rating: Buy
Despite the visible expansion of the real estate portfolio that continued in the first half of 2020, Coreo AG's rental income only showed a constant development to EUR 1.55 million (previous year: EUR 1.64 million). In the case of the NRW portfolio acquired in 2019, with properties in Wuppertal and Bielefeld, the transfer of benefits and burdens took place on 1 May 2020, meaning that the rental income generated from this portfolio was only included for a two-month period. Together with the previously acquired locations in Gelsenkirchen and Lünen, the NRW portfolio generated gross rental income of EUR 0.35 million in the first half of 2020. In contrast, gross rental income in Göttingen fell by EUR 0.4 million. This can be explained by the partial sale of the portfolio and the planned increase in vacancies in the run-up to extensive modernisation measures.
The scheduled sale of properties in the Göttingen portfolio and, to a lesser extent, of properties in the Hydra portfolio caused a significant increase in sales proceeds to EUR 5.77 million (previous year: EUR 0.92 million). With a book value disposal of EUR 5.28 million, Coreo AG posted a disposal result of EUR 0.49 million (previous year: EUR 0.45 million) for the first six months of 2020, whereby only the sale of the property in Viersen from the Hydra portfolio made a contribution to earnings for EUR 0.7 million. The Göttingen portfolio had already been written up to the level of the selling price at the end of 2019.
Based on the constant development of rental income and the sales result, which was also at the previous year's level, Coreo AG is reporting an overall improvement in operating earnings. At EUR -0.10 million (previous year: EUR -0.31 million), EBIT was just below break-even. Although Coreo AG achieved a reduction in the cost of materials due to lower maintenance measures, recruitment of new employees led to higher personnel expenses.
Coreo AG had originally planned to issue a corporate bond with a volume of EUR30 million to finance future project and property acquisitions and to repay the comparatively high-interest warrant bond (coupon: 10%). Since a volume of EUR10 million had been placed by the end of the subscription period, the company would not have been able to implement its investment plan and therefore cancelled the public bond issue. As a substitute, a private placement in the amount of the original bond volume of EUR 30 million is to be carried out. According to the company, this should be successfully placed in the coming weeks. After repayment of the warrant bond with an outstanding volume of EUR15 million, the company could use around EUR15 million to implement concretely planned real estate acquisitions. With an assumed LTV (loan-to-value) of 66%, new real estate objects could be acquired with a total volume of up to EUR50 million. According to the company, exclusivity agreements currently exist for properties worth more than EUR40 million.
In our revenue and earnings forecasts for 2020, we had assumed new investments totalling around EUR25 million in addition to the existing portfolio. Even if the company is able to implement the planned property acquisitions promptly following a successful private placement, these are unlikely to have a relevant impact on revenue and earnings until next year. In the case of the recently acquired, fully-let logistics property in Haßloch with a total investment volume of EUR3.4 million, the change in benefits and burdens will not take place until the turn of the year. The property with a rental area of around 10,000 sqm is leased to a sporting goods manufacturer until mid-2024.
As we are postponing, to a large extent, the additional revenue and earnings from the originally planned EUR25 million investment until the coming financial year, we are adjusting our forecasts for the current financial year 2020. As a result of reduced rental income, we now expect EBIT of EUR 3.10 million (previously: EUR 5.51 million). For the coming years, we continue to plan investments of EUR 40 million each and, therefore, our forecasts remain largely unchanged.
In our DCF valuation model, which was slightly adjusted compared to our last research study, we have set a new price target of EUR 2.35 (previously: EUR 2.60). Based on the current price level of EUR 1.42 there is a high upside potential and we continue to assign the BUY rating. Our BUY rating is supported by the published NAV, which amounted to EUR1.88 per share at 31 December 19.
Die vollständige Analyse können Sie hier downloaden: http://www.more-ir.de/d/21787.pdf
Kontakt für Rückfragen Jörg Grunwald Vorstand GBC AG Halderstraße 27 86150 Augsburg 0821 / 241133 0 research@gbc-ag.de ++++++++++++++++
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