Image: APA/HANS KLAUS TECHT
The company posted a net loss of over one billion (2021: +732 million) euros, as shown in the not yet published annual financial statements for 2022, which are available to the APA. In a statement, Signa attributed the valuations “exclusively” to macroeconomic circumstances.
The revaluations would also be better compared to the overall market “due to the outstanding quality” of Signa Prime’s portfolio, a Signa spokesman told the APA when asked about figures and further information from the annual report. He also referred to hidden reserves that would arise from the evaluation of long-term interest rate hedging. Taking this into account, the company would have achieved an “adjusted profit” of 90 million euros in the 2022 financial year.
750 million euros capital increase
The German “Handelsblatt” had already reported on the loss of value of the portfolio and the result at the end of July with reference to a presentation by Signa for its banks, which the spokesman also pointed out to the APA. Among other things, there is talk of a 750 million euro capital increase, which, according to information in the annual financial statements, was then decided on at an extraordinary general meeting. As the auditor notes in its report on the audit of the financial statements, the increase had a “stabilizing” effect on equity. This fell from 5.57 billion euros in 2021 to around 5.42 billion euros in 2022. Signa did not comment on the capital increase to the APA.
According to the documents, management did not want to propose a distribution for 2022. However, the bonuses for managers in key positions have increased. These rose to a good 19.1 million euros, after around 1.6 million in the previous year. The company spokesman did not comment on this either.
Regarding further business developments, the spokesman noted that the Signa real estate division (Signa Real Estate) had sold around a dozen properties in the past few months, with a total volume of around two billion euros in Germany, Austria and Switzerland. Each individual transaction was significantly higher than the last bank rating. “Overall, the profit from these sales was more than 50 percent based on the historical total investment costs of these projects,” the spokesman explained. The total debt of the Signa Real Estate companies is currently less than 50 percent (loan to value). Signa Prime’s annual financial statements show a loan-to-value ratio of 46.9 percent for 2022.
The real estate market has recently been in turmoil due to increased interest rates and high construction prices. This also affects companies in the industry. The value at which many properties are on the books of real estate companies is currently falling. However, these are pure book losses as long as the company does not sell the properties.
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