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Edited Transcript of IIA.AT earnings conference call or presentation 22-Apr-20 1:00pm GMT

Full Year 2019 Immofinanz AG Earnings Call

Wien Jun 17, 2020 (Thomson StreetEvents) -- Edited Transcript of Immofinanz AG earnings conference call or presentation Wednesday, April 22, 2020 at 1:00:00pm GMT

TEXT version of Transcript

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Corporate Participants

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* Dietmar Reindl

IMMOFINANZ AG - COO & Member of Executive Board

* Stefan Schönauer Bakk

IMMOFINANZ AG - CFO & Member of Executive Board

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Conference Call Participants

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* Jakub Caithaml

Wood & Company Financial Services, a.s., Research Division - Equity Analyst

* Thomas Neuhold

Kepler Cheuvreux, Research Division - Head of Research of Austria

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Presentation

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Operator [1]

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Ladies and gentlemen, thank you for standing by. I'm Haley, your Chorus Call operator. Welcome, and thank you for joining the IMMOFINANZ Conference Call on the 2019 Earnings. (Operator Instructions)

I would now like to turn the conference over to IMMOFINANZ. Please go ahead.

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Dietmar Reindl, IMMOFINANZ AG - COO & Member of Executive Board [2]

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Ladies and gentlemen, good afternoon, and welcome to our conference call for the financial year 2019. My colleagues, Stefan Schönauer and me, Dietmar Reindl, will present our very strong results and take a good comprehensive look at the current impact of the COVID-19 pandemic on our business. We will then be pleased to answer your questions.

The financial year 2019 marked a milestone in our business. The highlights from our portfolio perspective are, for example, in a first step, the all-time high occupancy rate of 96.8%. We were able to increase the occupancy rate compared to 12/2018 even by 1 percentage point.

The portfolio value, on the next page, shows a substantial portfolio growth by 18.1%. And the rental income of EUR 279.9 million shows as well a growth of 18.1% and reflects the bigger portfolio but also a very positive like-for-like rental income growth of about 3%.

The gross return is, for us, a very important key figure, and we could keep the gross return on a high level of 6.5%.

We were as well able to translate the higher rental income to in parallel an increased result of asset management of EUR 207.3 million, and this is an increase of 19.1%.

I would now like to hand over to Stefan Schönauer for the financial highlights.

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Stefan Schönauer Bakk, IMMOFINANZ AG - CFO & Member of Executive Board [3]

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Hello, ladies and gentlemen, also from my side. I will continue with the presentation on Page 10. And I'm very proud to present to you our net profit for the period of 2019, this means EUR 352.1 million. We achieved an increase of 62%.

If we look into earnings per share on the next slide, this shows you an increase of 71% and earnings per share came in with EUR 3.37.

On Page 12, let's quickly have a look on our FFO 1 that we generated in the financial year 2019. Our FFO is up 30%, with EUR 137.4 million. This is exceeding our guidance of EUR 128 million significantly. And here, we've also closed the gap to our peer group. Further growth of our FFO in 2020 is coming from acquisitions that we have closed late in 2019, and that will be fully in our financial results from start of 2020 onwards. Details about these acquisitions, you will see later in the presentation.

I will continue on Page 13 with our net LTV. Our net LTV is 43%, and is well in the range of our target of 45%. This LTV is a very important column for being set up well in the current financial crisis in the corona crisis.

And the second very important column, we want to present to you on Page 14. Our liquidity is EUR 345.1 million as of end of 2019, and this we consider a very strong position.

We are also proud to say that with end of March 2020, we were able to close a revolving credit facility in the amount of EUR 100 million, and this secures for another 2 years an amount of EUR 100 million, adding to the strong cash position. So that means, all in all, we have EUR 450 million available liquidity at hand. And we are bear with -- set up well and well prepared for the COVID-19 situation.

I would now like to hand back to Dietmar Reindl for a portfolio update.

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Dietmar Reindl, IMMOFINANZ AG - COO & Member of Executive Board [4]

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I think you are all more than aware of our successful real estate brands: myhive properties, VIVO! for shopping centers and STOP SHOP for retail parks. So just -- let me just give an update on these 3 brands very briefly.

For myhive today or at the end of '19, we had 23 properties in 6 countries, summing up to a GLA of more than 0.5 million square meter. We are planning and have under construction further myhive locations in Vienna, Düsseldorf and in Bucharest.

Looking at STOP SHOP retail parks. By the end of '19, we had already 89 STOP SHOPS in 9 countries with a very convincing occupancy rate of 98.8%, and a gross return of 8.1%.

Looking at our VIVO! shopping centers. During the last year, we modernized 2 VIVO! shopping centers, the one in Cluj and the other one in Bratislava. This was successfully completed in 2019. And we could bring in new and quite well-known anchor tenants like Peek & Cloppenburg, Lidl or brands from the LPP group in Poland. The occupancy rate is on a good level of 97.5%, and the gross return as well on 8.1%.

Looking at the completions on Slide 20. Last year, we completed the FLOAT office building from top architect Renzo Piano, in Düsseldorf. And we converted an old office tower -- office building in Vienna into a mixed-use concept for office and hotel and also did a very new facade.

In the STOP SHOP brand field we opened in August 2019 a 100%-leased STOP SHOP in Sremska Mitrovica with a GLA of 7,000 square meter. And STOP SHOP #90, we opened this year on the 26th of March in the city of Siedlce in Poland. It's one of the biggest STOP SHOPS with 14,100 square meters GLA, occupancy rate was 99%. Although it was one of the saddest STOP SHOP openings we had because of the COVID-19 situation, we were only allowed to open 4 stores in the food and convenience sector. And the tenants are eager to -- once this -- all these regulations will, say, allow to open again to open the stores in this very nice STOP SHOP in Poland.

Looking at development projects. We've already quite much reduced the property development portfolio below 4% even. And the project we have at the moment under construction, we are finishing. But other projects, we are having on hold now until we have a detailed or a better view on the consequences of the COVID-19 crisis.

Looking at acquisitions. We acquired last year one of the most iconic office buildings in the CEE region, and it's even the highest office building in CEE, the Warsaw Spire, on 72,000 square meter. Second acquisition was the Palmovka Open Park in Prague. And the STOP SHOPS as well had some acquisitions, we acquired 5 STOP SHOPS in Slovenia and one in Poland on a very nice yield level of 8.6%.

I would now like to hand over again to Stefan Schönauer for the results and the financing.

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Stefan Schönauer Bakk, IMMOFINANZ AG - CFO & Member of Executive Board [5]

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Yes. Thank you very much. Let's continue, please, on Page 27 of the presentation, and I would like to dive now a little bit deeper into our profit and loss statement. Some of the figures we already saw in the highlights. I will, therefore, repeat them just briefly.

Our rental income came in with EUR 279.9 million, an increase of more than 18%. And also the result of asset management increased in a similar stage by 19% to EUR 207.3 million. Result of property sales was slightly negative. And compared to the previous fiscal year, I would like to explain that the previous year's positive result were influenced by OCI recycling. That means we had to account for historic foreign exchange losses in our P&L -- sorry, historic foreign exchange gains.

Results of property development means we had also here a negative impact due to the sharp increase in construction costs, especially in Germany and due to higher expenses for real estate inventories. The result of property development was EUR 12.4 million negative.

On the other operating expenses, we were able to save money, and we had here savings of about 7.6% compared to the previous year, resulting to minus EUR 46.1 million. This brings us to a result of operations of EUR 149.9 million.

We had a very positive revaluation result of EUR 195.7 million. This was fueled predominantly from yield compression in the markets Austria and Germany but also all other CEE regions contributed positively to this strong result. We will see also a like-for-like comparison of our revaluation results in the appendix of this presentation.

The financing costs, the net financing cost to be precise, came in with EUR 63.4 million, and this is a slight increase compared to the previous year. Here we have to split financing costs -- actually improved, although the volume increased compared to previous year but we were shorter -- short in financing income. And this is because we finished a joint venture in the Czech Republic, and did not receive any finance income from this joint venture.

Net profit for loss from equity-accounted investments was EUR 78.4 million positive. This is basically the contribution that we received from our investment in S IMMO. So the financial results were again in the second year in a row positive with EUR 4.5 million, compared to EUR 44.2 million the previous year. The earnings before taxes amount to EUR 350.1 million, and there, we formed an increase of 72.2%.

Taxes were just about minus EUR 2.5 million. This splits up into EUR 8.5 million current income tax and EUR 6 million deferred tax income.

The net profit or loss from continuing operations therewith accounts for EUR 347.5 million. And if we add here the positive contribution from our former Russian investments where we, again, received some reimbursement for taxes, we come to the net profit of EUR 352.1 million for the period 2019.

Let us now, on Page 28, again, have a quick look on our FFO. I already mentioned that we strongly exceeded our guidance of EUR 128 million. Our FFO was EUR 137.4 million before taxes and including dividends from S IMMO. And this means we generated an FFO per share of EUR 1.29.

On Page 29, I would like to just pick up some more highlights that we achieved in the financing department in 2019. First, and this happened already in January last year, we achieved the milestone with getting an investment-grade rating from Standard & Poor's with BBB- and stable outlook. And on the basis of this rating, also in January, we were able to issue our first benchmark-sized bond in the amount of EUR 500 million. This bond has a duration of 4 years.

I mentioned already that we have a very strong liquidity base of EUR 345 million. And we, on top to that, arranged a credit line, now in March, so to say, in the middle of the corona crisis, to further improve the strong liquidity base to about EUR 450 million available cash.

With the bond in January, we were also able to improve significantly on our unencumbered asset base. And if you take here into account unencumbered real estate plus our unencumbered stake in S IMMO, we have almost EUR 2 billion of assets unencumbered, and this is also a very strong and solid column for the situation in the corona crisis that we are in at the moment. And last but not least, we improved our remaining term of financial liabilities to 4 years.

On Page 30, just 2 figures, briefly, our financing costs again decreased in this low interest rate environment to 1 0.91% (sic) [1.91%] and our net LTV, I mentioned already, is 43%.

On Page 31 of the presentation, I would like to draw your attention to our maturity profile. Our maturity profile shows you that we have very low refinancing needs in 2020 and 2021 at positive situation and market environment like the one that we are in at the moment. We are positive to have these refinancings done that are due in 2020 at the year-end. And as mentioned, there's only a very small volume of EUR 91 million in 2021.

On the other hand, we were able to increase our hedging quota to more than 90%, and this also secures up in a potential increase of interest rate.

Therewith, I would like to hand back to Dietmar Reindl for an update on the corona situation.

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Dietmar Reindl, IMMOFINANZ AG - COO & Member of Executive Board [6]

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Let's have a look now on the effects of COVID-19 crisis on our portfolio. And what you can see on this slide is a new key figure we are using in our business, which we never had to use before, and this means this is square meter open. In the past, we had all our square meters open, but we have to adapt to the new situation, that's why we are looking at this -- at this key figure even daily now. And if you look at our portfolio, as of the 17th of April, then we had 95.8% of our office GLA open and 27.5% of our retail GLA open in office. The difference is just services, restaurants and retailers, small retailers, on the ground floor of office buildings.

So we would focus now on the retail portfolio. And good news or bad news, but we were able to collect for the month of March and April 53.6% of the invoiced rent. Until now, the rent collection is still ongoing because we have different dates during the month when we're collecting the rent in different countries, but we have -- at least, we have crossed the 50% line.

For the time being, we have, with some exceptions that we'll mention later, in all countries, restrictions from governments about the opening of retail stores in our portfolio with the exception of essential services like food, drug stores, banks and so on.

What have we done in the first step, the rent for March, we invoiced as usual, normally, and -- but we deferred the rent for April 2020 until September to relieve the burden on retailers in their liquidity on the short term. And since that, we've started negotiations with many retailers. Looking at our portfolio, we have about 20 very large retailers that are forming 50% of our entire portfolio. For example, Deichmann we are in 71 contracts; with KIK, we're having 65 contracts. And with these retailers, we are convinced we will reach a good solution for them and for us in a good partnership, latest until end of May, covering the situation until end of the year even.

On the next slide, you can see in some details that we are following the legal effects on our retail portfolio, as I mentioned, daily. Unfortunately, we're having in all our countries, different solutions, but we're handling that also with our local offices. And most positive news for the retail business, we had on April 14, starting in Austria with the opening of stores smaller than 400 square meter out of shopping centers. This means we could open some stores in our STOP SHOPS in Austria already. And the effect, we might see a bit later.

The footfall has become a very important key figure because footfall is something we are measuring since 2, 3, 4 years with a very advanced digital system, where we get update on the footfall of all our shops, in our STOP SHOPS and of all of our shopping centers daily. So we can see how the market develops every day. And on Slide 35, you can see the development of the STOP SHOP portfolio. The scaling is done logarithmically. Normally, we had, per week, 2.5 million visitors in STOP SHOPS. And this went down below 1 million in this phase now. And in VIVO!, we had, per week, about 1 million visitors, and it is now below 200,000. Difference is that we have, in STOP SHOPS, a higher share of essential services like food stores and banks and so on.

In -- on Slide 36, we were testing the effect of these slow openings, as we have seen them in Austria, and we've seen that the footfall is increasing, not rapidly, but constantly. And we are learning sort of, say, every day from development in Austria. And as we are expecting the next openings like they were done in Austria, in Czech Republic and Slovakia, we can implement the measures we have taken here in the other countries. And I would say, the easements continue. And in Austria, starting from 2nd of May, all stores we've allowed to open, and we expect on May 15, that as well the restaurants might be allowed to open again.

What measures have we taken in detail? We have done, first of all, as I mentioned before, were these intensive dialogue with our tenants, with the idea to balance their contractual obligations with their turnover decrease. For this, we're using as well our visitor frequency system to have, say, an objective judgment of their performance.

We have, on our side, worked very quickly and started quickly, programs to reduce our costs and strengthen our group liquidity. In quarter 1, we did still some sales of properties, not being part of our core portfolio, with an amount of EUR 18 million. We have, as mentioned before, a low volume of current development projects. And we postponed pipeline projects, so to say, until further notice. We stopped all property purchases, and we have deferred non-time critical maintenance activities. We are on the way to reduce our operating costs. And where possible, we are using tax deferrals and savings. And we have deferred principal repayments to banks, some are already in effect and some are under negotiations.

With this, I would hand back again to Stefan Schönauer for the valuations.

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Stefan Schönauer Bakk, IMMOFINANZ AG - CFO & Member of Executive Board [7]

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Yes, ladies and gentlemen, let me continue on Page 38, and let's quickly have a look on how COVID-19 situation will impact the valuation of real estate. We are, for this question, in very close dialogue with international large real estate appraisers. And we also collected some statements from Jones Lang LaSalle, CB Richard Ellis and BNP Paribas on the slide for you. I think you can sum up their thoughts in a way that, at the moment, none of them expect a real big impact in the valuation of real estate. And this assumption is, for sure, depending on the duration of the total shutdown and the COVID-19 crisis. What makes the valuers think positive about this situation is that we still are and we still will be, after this crisis, in a very low interest rate environment. And there is a lot of cash available in the market, and this cash is still searching for yield. So the real estate sector, according to their assumptions, will be also, after this crisis, in a very attractive asset class and very attractive asset allocation perspective.

Our revaluation results were positive by more than EUR 190 million, as already mentioned. But I would also like to point out here that this means just an increase of 3.7% based on our total portfolio value and shall be seen, therefore, also as a conservative valuation approach.

Let me add also one more point. Our property valuations are all done in euro. This means that all our rents are in euro or linked to the euro, and we also do not expect any material effects from changes of currencies in CEE countries to our revaluation results.

If you turn the page to Page 39, let's continue with the question about foreign exchange effects and our hedging strategy here. I already mentioned that our rental income is denominated in euro or linked to the euro, and this is valid for 98% of our rental income. The rest, the 2%, are in currencies that we presented to you on this page, like the Czech koruna, the Hungarian forint or the Polish zloty. And yes, we saw here some heavy reaction in these currencies compared to a 5-year average. But as already mentioned, our rental income is linked to the euro, and therewith, we don't expect any major impact in our earnings from that side.

Let's now continue with the last chapter with the outlook, and I would like to hand back again to Dietmar Reindl.

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Dietmar Reindl, IMMOFINANZ AG - COO & Member of Executive Board [8]

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Yes. Thank you, Stefan. I think the measures, we mentioned some of them already, the intensive dialogue with our tenants, cost reductions and liquidity that we are strengthening. What we are doing as well now, we have used this shutdown, so to say, to actively work with our marketing and to develop concepts how to support our tenants in rapidly restoring the football -- the footfall in their retail spaces.

And in the office sector, we are supporting our tenants with back-to-office programs, looking at space concepts, distancing regulations, disinfection, I say, possibilities, protective measures, access rules and so on because we're expecting during the next 2 to 3 weeks that in many countries, people will come back again to the offices. And this, we have to prepare for and support our tenants with these measures.

In general, in the outlook, what we are seeing, again, in this crisis, that our 3 brands are well positioned. We have a competitive advantage with our brands, STOP SHOP and VIVO!, mainly because we have very attractive rent and operating costs. And even if the turnover of tenants would decrease or be lower, they still could afford the rent in our, so to say, cheaper retail schemes. And secondly, the tenant mix in our products has a strong path in the convenience segment. And we know that even in economically difficult environments, the demand for this segment is as well higher.

Coming to our myhive brand. We have already, let's say, 12 months ago, started to develop a follow-up, myhive 2.0, as we call it, where we offer as well flexibility. And this early, I would say, investment into this upgrade of the concept pays off now because we think that flexibility will be a higher demand even after this COVID-19 crisis, because companies will be even more careful with the costs they are spending, and that they target the cost to invest in the right sense. That's why in this concept, we have ready-to-use office spaces. We will offer all-inclusive contracts. We will offer short lease terms, and we will offer rent per work space.

For the last part, liquidity and dividend, I would like to hand back again to Stefan Schönauer.

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Stefan Schönauer Bakk, IMMOFINANZ AG - CFO & Member of Executive Board [9]

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Yes. Let me, on Page 43, summarize once again for you that we have a very strong liquidity base of EUR 350 million. We have an additional credit facility of EUR 100 million, and we have very low refinancing needs in the years 2020 and 2021. Further to this, we try to strengthen our liquidity position with the reduction of amortization payments towards bank loans that we have. We have been very successful in the first weeks of this crisis here already. And I can report that we have now reduced about 25% of amortization payments in the office space and 50% in the retail space as of now. This means a saving of about EUR 11.4 million liquidity for the financial year 2020. And we are not stopping here. We are further reducing here amortization payments, especially in the retail segment, where the goal is that if we don't get earnings, then we don't pay the banks.

Regarding our general meeting and regarding dividend plans, you are probably already aware of that we announced that our Annual General Meeting is postponed to 1st of October. Our plans regarding dividend, the guidance is still valid. The guidance is that we pay 75% of our FFO 1 to our shareholders. However, we have postponed the decision regarding this earnings distribution to our shareholders, and we will publish this with the results in August, with the half year results in August. And up to this point, we will evaluate how the prices of COVID-19 will impact our business.

Ladies and gentlemen, I would now like to hand back to Dietmar Reindl for the very last words, and then we will be open for your questions.

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Dietmar Reindl, IMMOFINANZ AG - COO & Member of Executive Board [10]

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Ladies and gentlemen, COVID-19 presents a real headwind for the overall economy and for our markets. But we are very well prepared for this period. And we're looking ahead and are already working on ways to support our tenants' businesses to move forward again. In other words, COVID-19 has slowed us down maybe, but it has not set us back. We are, for sure, COVID-fit.

We are happy now to take your questions.

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Questions and Answers

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Operator [1]

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(Operator Instructions) And the first question comes from the line of Thomas Neuhold of Kepler Cheuvreux.

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Thomas Neuhold, Kepler Cheuvreux, Research Division - Head of Research of Austria [2]

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I have a couple of questions, and I think the best is if you take them one by one. Firstly, I was wondering, are you currently only in negotiations with your top 20 retail clients? Or did you also, in the office segment, already faced some requests for rent reductions? And what would you consider, what you call in the presentation, a good solution for you and your tenants?

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Dietmar Reindl, IMMOFINANZ AG - COO & Member of Executive Board [3]

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Let me answer your question right directly. We are, say, focusing on negotiations with the 20 biggest tenants, but we are in discussions with all -- mainly all tenants in the whole portfolio. But the focus goes on those that represent the biggest, let's say, share of our portfolio.

In the office sector, we have from, sort of say, the ground for our tenants offering services, restaurants and small retailers. We have some request like in Austria, also, they have legal possibilities to avoid the rental payment from office tenants. We have one or the other case, but it seems more as the tenants who are trying to serve on the COVID-19 wave. So getting for them an advantage where they have no legal ground really for it.

What is a good solution? Let me raise one example without saying the names, and this is for shops that were totally closed during the shutdown. They get 50% rent discount during the shutdown. And the first 3 months after the shutdown, a 20% rent decrease. This was one example.

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Thomas Neuhold, Kepler Cheuvreux, Research Division - Head of Research of Austria [4]

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Okay. And then you mentioned you will try to compensate potential lower rental income, better cost savings. Can you maybe quantify what kind of cost savings potential you have identified? And how long it will take you to realize these cost savings?

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Stefan Schönauer Bakk, IMMOFINANZ AG - CFO & Member of Executive Board [5]

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Thomas, yes, we will take this up. We have prepared this in pretty much detail. I would like to start with explaining what we are focusing on. There are 2 things to differentiate. On the one hand side, it falls in such a situation wherein it's focused on liquidity. And the savings, we split into 2 categories: real savings and postponement of payments, so to say.

To answer your question, we expect from reduction of operating expenses from postponement or cutting maintenance from the reduction of fit-out costs, overhead costs and postponement of development projects about a sum of EUR 40 million, roughly, compensating a shortfall -- a potential shortfall of rental income in 2020. And on top to that, I mentioned already that we're negotiating with banks that we do not pay amortization payments as long as this crisis lasts. We have already here secured and contracted EUR 11.4 million, and we worked also on an additional figure in this direction for saving cash. This means there is still some more to come in the next weeks, but I just want to report figures that we have already contracted. So cash is king in these days. This is the focus that we have on.

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Thomas Neuhold, Kepler Cheuvreux, Research Division - Head of Research of Austria [6]

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Okay. Can you maybe also give us a feel of what kind of FFO impact the cost savings could have?

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Stefan Schönauer Bakk, IMMOFINANZ AG - CFO & Member of Executive Board [7]

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No, this is in too early state in the crisis. We are not prepared today to give any FFO guidance. I think this is really too early.

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Thomas Neuhold, Kepler Cheuvreux, Research Division - Head of Research of Austria [8]

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No, no, just the impact of the cost savings, the FFO effect of the cost savings.

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Stefan Schönauer Bakk, IMMOFINANZ AG - CFO & Member of Executive Board [9]

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This is hard to really analyze because, as I said, if you postpone a maintenance measure for some months, that is saving liquidity. But if it comes later, then it will not reduce the cost in total. So we do not give guidance on the FFO or nor on the impact yet.

For sure, we know that this is an important thing to be done, but I think we will have to wait here for some more weeks, probably even months until the situation stabilizes, and then we can give a precise analysis on that topic.

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Thomas Neuhold, Kepler Cheuvreux, Research Division - Head of Research of Austria [10]

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Okay. Understood. And the next question is on Slide 34. Thank you for providing some details on the sector exposure in the office segment. I was just wondering if you can give us also a figure. What kind of exposure you have to co-working companies such as WeWork in the office segment?

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Dietmar Reindl, IMMOFINANZ AG - COO & Member of Executive Board [11]

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Yes, happy to do that. We had discussions with WeWork 2 years ago, and we took the decision not to cooperate with them because one of our -- of our core strength is through working with our customers directly. And if you are leasing space to WeWork, you are losing a direct contact to your tenants.

We have one of the other smaller co-working operator. We have one in Prague, and we have one in Warsaw, but that space is like 500 square meter, 1,000 square meter. So in our portfolio of more than 1 million square meter of office space, it's not so substantial. And we are having a long-term relation already with Regus in different locations, for example, like in Vienna. But this is contracted or cooperation with them. This is -- can sometimes lasting more than 10 years.

In total, if you include Regus bases of about 1.2% of our portfolio with these kind of co-working or flexible office operators.

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Thomas Neuhold, Kepler Cheuvreux, Research Division - Head of Research of Austria [12]

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Okay. And then, finally, I have 2 more strategic kind of questions.

Firstly, can you give us an update on the S IMMO situation, specifically, do you intend to restart merger talks? And when could that happen? And secondly, are there any plans to replace Mr. Schumy, the CEO?

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Dietmar Reindl, IMMOFINANZ AG - COO & Member of Executive Board [13]

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Let me take the -- first, the S IMMO topic. We are generally not excluding the resumption of discussions over the combination of the 2 companies, and we are open to this possibility. However, the time frame is dependent on the duration and effects on the corona crisis. So there is simply no time frame at the moment.

Regarding replacement of Dr. Schumy, this is a topic which is subject to discussions or decision of our Supervisory Board, and is not a topic for us.

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Operator [14]

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The next question comes from the line of Jakub Caithaml of Wood & Company.

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Jakub Caithaml, Wood & Company Financial Services, a.s., Research Division - Equity Analyst [15]

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It's Jakub from Wood. Thank you very much for the presentation and also for kind of helping us understand the situation from your perspective, that's very appreciated.

I also have a couple of questions. First, just a technical one. Is it the credit line, the EUR 100 million that you were mentioning, committed at the moment, so you can access the money anytime?

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Stefan Schönauer Bakk, IMMOFINANZ AG - CFO & Member of Executive Board [16]

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Yes. We can draw the money anytime. It has a duration of 2 years. And it's a revolving facility, we can draw, we can pay back. And this is now secured for 2 years.

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Jakub Caithaml, Wood & Company Financial Services, a.s., Research Division - Equity Analyst [17]

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Excellent. In one part of the presentation, you were mentioning that you collected just over half of the retail rent for March and April. However, there have been also these deferrals granted for the April rent.

So I was just wondering if you could help me understand how to interpret this 54% figure. I mean is it the rents for March? Or did some of the tenants, which they didn't have to pay the rent for April, actually chose to pay, in retail?

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Dietmar Reindl, IMMOFINANZ AG - COO & Member of Executive Board [18]

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Yes. Unfortunately, it's a total mixture of different things because we have different points of time where we're collecting the rent. In general, you can say that the -- in March, more tenants paid than in April. But still in April, some of the tenants did not, say, take this offer to defer the rent, and they paid the rent and did not accept this deferral from their side. And as I mentioned before, this is the rent collection status until April 17. So we are expecting some additional rental income still until the end of this month. And then we can say more. It differs country-by-country, influenced by the legal situation, but this is the status we have today that we can give you.

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Jakub Caithaml, Wood & Company Financial Services, a.s., Research Division - Equity Analyst [19]

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Sure. And do you have visibility, perhaps, I mean, if you would be closing a contract on the financial position of your tenants? And do you have any indications as to how big share in terms of total retail rental income or total retail GLA could happen to become kind of in a very difficult financial situation, kind of at the risk of bankruptcy?

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Dietmar Reindl, IMMOFINANZ AG - COO & Member of Executive Board [20]

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For the time being, and now we have already 4 weeks or maybe even 5 weeks, in this situation, we had 1 lone bankruptcy of a fashion tenant called Colosseum. With this tenant, we had 2 stores of each of them around 200 square meters. And if we look at our portfolio size, this is not even visible, and there was a very, very small local sweet shop of, I think, 50 square meter that went bankrupt as well. We are having from no other ones, especially from the big international retailers where we have many stores with them, any indication that they're going into bankruptcy. And there was one called CCC shoes, we have with them some stores. But with them as well we found a good solution, and they will continue to operate. And they are more on concepts, so I expect from there is revenue problems.

So I think that the retailers, they will be able to recover slowly, but we'll be able to recover. And especially, as in our concepts, the OCR, for the occupancy cost ratio, this means the total costs for the rooms they have rent plus operation cost is quite low compared to the competition we have here in STOP SHOPS, around 9.5% OCR, and in VIVO! is around 10.5% OCR. In other concept, they have 14% or more. So we will, for sure, not be the first in line that will be harmed by problems of tenants.

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Jakub Caithaml, Wood & Company Financial Services, a.s., Research Division - Equity Analyst [21]

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Understood. This is very helpful. On the retail side, the bulk is just under 4 years, which means that around 1/4 of the contract should be kind of rolled over annually. Have there been any extensions negotiated during the past 4, 6 weeks? And if so, can you give us an indication on the -- how did the new rental value compared to the previous one?

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Dietmar Reindl, IMMOFINANZ AG - COO & Member of Executive Board [22]

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In the retail business, the contracts are normally 5-years contract. So when you're below 5, this is more than natural. We had mainly with these 20 bigger tenants because if they have 50, 60, 70 stores, some of them might come for prolongation. And we have, in none of these cases, done any, say, contractual rent discount for the prolongation. 0 cases.

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Jakub Caithaml, Wood & Company Financial Services, a.s., Research Division - Equity Analyst [23]

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Understood. That's helpful. Then finally, with respect to the dividend, and I appreciate the decision is yet to be taken. But would it be possible to help us understand what kind of scenarios would you be considering and, kind of a general sense, under which conditions would you be willing to go ahead and actually pay the dividend? And what -- kind of what precludes you to do so? For instance, I mean, the investment-grade comes to mind. I mean would you still be looking to pay dividend even if finance was downgraded?

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Dietmar Reindl, IMMOFINANZ AG - COO & Member of Executive Board [24]

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Jakub, look, I think the decision that we postpone the AGM to have more clarity about the overall impact of COVID-19 and there is also the decision that we will later in the year take a look towards the dividend, this is the best we could do at the moment. And we will monitor the overall situation. We will monitor the liquidity position of the company and the risks and chances that are in front of us after we have seeing this situation to ease and to -- we have to see a light in front of the tunnel. We are now not able to give you here any more detailed guidance. And for sure we will, very detailed, look at this and also discuss this then with the Supervisory Board. And together then, we'll make a decision about the potential dividend for the AGM in October. More than that, I think it's too early to give guidance.

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Operator [25]

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(Operator Instructions) And there are no more questions at this time. I hand back to the presenters for closing comments.

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Dietmar Reindl, IMMOFINANZ AG - COO & Member of Executive Board [26]

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Ladies and gentlemen, thank you very much for participating in our call. We all wish you all the best, stay healthy and hope to hear you again with our Q1 results. Thank you very much, and bye-bye.

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Stefan Schönauer Bakk, IMMOFINANZ AG - CFO & Member of Executive Board [27]

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Bye.

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Operator [28]

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Ladies and gentlemen, the conference has now concluded, and you may disconnect your telephone. Thank you for joining, and have a pleasant day. Goodbye.