EANS-Adhoc: Sparkassen Immobilien AG: final results 2008 Profit despite difficult environment

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annual report

29.04.2009

Stock exchange listed Sparkassen Immobilien AG (Bloomberg:
SPI:AV, Reuters: SIAG.VI) closed 2008 - an economically extremely
difficult year - with a clear profit despite devaluations, and
boosted both revenues and rental income.

In comparison with the previous year Sparkassen Immobilien AG's
revenues and rental income both grew by 14%, to EUR109.2m and
EUR85.7m respectively. The Group exceeded its revenue forecasts
considerably. This positive performance is attributable to
additional property purchases and new lettings. Analysis of
rental income by region shows that the majority of rents (71%)
continued to come from Austria and Germany. By property use
type, rental income from residential property has shown the
greatest increase. The acquisition of additional residential
buildings in Germany, which are generally less dependent on economic
fluctuations, increased the proportion of residential rental income
from 22% in the previous year to 33% in the year under review.

Market turbulence and the general sector trends led to Sparkassen
Immobilien AG devaluing its portfolio by a total of EUR101.7m.
The German portfolio was devalued by 8% and the CEE portfolio by
13.5%. A major part of these writedowns was made good by increases
in value elsewhere, so that the net writedown amounted to
EUR-30.7m. The valuation gains were largely the result of
successful completion of the Gemini commercial and office property
in Prague and the consequent revaluation from at cost to current
market value, as well as profitable asset management activities,
such as the conversion of the Novotel hotel in Bucharest.

The sale of eight properties from the property portfolio in 2008
brought gains of EUR8.3m. The assets were sold on average 19% in
excess of the most recent estimated values.

EBITDA fell by 25%, from EUR78.9m to EUR59.2m. The target EBIT
for 2008 of EUR36-48m was not attainable because of the marked
deterioration in the market environment in the last quarter of the
year. Actual EBIT for 2008 of EUR23.8m was nonetheless still
significantly positive (2007: EUR100m). The decrease was
predominantly a consequence of valuation write-downs, compared with
gains of EUR41.1m in the previous year, leading to a valuation
difference of EUR71.8m compared to the previous year. The net
financing cost fell back from EUR-20.5m to EUR-9.6m, reflecting the
greatly increased financing income in the form of interest income,
currency gains and income from interests.

EBT fell from EUR35.4m to EUR7.8m. The consolidated net profit for
the year was EUR5.7m. Sparkassen Immobilien AG's net operating
income (NOI) rose from EUR64.5m to EUR67.9m, an increase of 5%.
The NOI margin (NOI/revenues) stood at 60%. Cash flow from
operations rose from EUR49.4m to EUR50.0m. Funds from
operations (FFO) fell by 22%, and for the year under review
amounted to EUR34.2m (2007: EUR43.8m).

Sparkassen Immobilien AG's property portfolio in financial 2008 grew
by 9% to 1,511,400 m2 and 263 properties, mainly as a result of
the acquisition of 34 standing properties in Germany and six
properties in Austria, Croatia and Slovakia. The value of the
portfolio at the end of 2008, at EUR 1.78bn, was 15% higher than at
the end of the previous year. Development projects, which are
recognised at cost of construction, made up 16% of the total
value of the portfolio.

Residential property made up 44% of the standing portfolio, with
the balance consisting of office properties (28%), commercial
properties (17%), hotels (7%) and other properties (4%). More than
half of the rental property is in Germany, with 27% of the portfolio
in Austria and the remaining 22% in Slovakia, the Czech
Republic, Croatia, Romania and Hungary. With the exception of a
single office property in EU candidate country Croatia, all
Sparkassen Immobilien AG's properties are in EU states.

The occupancy rate of the rental portfolio at balance sheet
date remained unchanged, at 91%. The average gross rental yield
(rent divided by market value) for all countries together at 31
December 2008 was 6.7%.

The accumulated investment in development projects at 31 December
2008 totalled EUR160.8m. The following are currently under
construction: a residential and office building on Neutorgasse
(Vienna), a student hall of residence on Sechshauser Strasse
(Vienna), shopping centres Sun Plaza (Bucharest) and Serdika
Center (Sofia), an office building Galvaniho 4 (Bratislava) and
Hotel Vysoká (Bratislava).

With a 74% loss over the course of the year, s IMMO share still
performed better than the I-ATX, but the year end closing price
was down to EUR1.98 (2007: EUR7.73). The NAV (net asset value) at
the end of 2008 was EUR8.9 per share (2007: EUR9.7), which
combined with the lower share price meant a discount to NAV of
78% at balance sheet date. Earnings per share fell from EUR0.38
to EUR0.09. At EUR134.9m, market capitalisation was down 73% down
on the value at the beginning of the year under review. Since the end
of 2008, the market price of s IMMO share has improved considerably,
with a year-to-date (as at 28 April 2009) performance of + 81.8%.

With Vienna Insurance Group, Sparkassen Immobilien AG gained a second
important core shareholder alongside Erste Group in September
2008. The networks, expertise and integrity of both Companies -
two of the largest financial services institutions in the region
- strengthen the future development of Sparkassen Immobilien AG.

In the interests of a lean, easy-to-understand management
structure, in 2008 the most important management functions and
staff were brought inside the Company and integrated internally.
In the process, the services provided by the Group's external
partner, Immorent AG, were re-negotiated and embodied in a new
management agreement. Bringing management in-house was entirely
without cost to Sparkassen Immobilien AG's shareholders.

Sparkassen Immobilien AG's strategic focus in 2009 will be on
optimisation of the existing portfolio, proactive asset management,
completion of development projects under construction, and
concentration on favourable opportunities for property purchases
and sales. The property portfolio will grow to roughly EUR2bn
in 2010.

Consolidated income statement for the year ended 31 December 2008
EUR m / fair value basis

|01.01. - 31.12. |01.01. - 31.12. |Change %
|2008 |2007

|Revenues |109.2 |95.9 |+ 14
|whereof rental income |85.7 |75.0 |+ 14
|Revaluation of properties |(30.7) |41.1 |
|Other operating income |6.5 |3.9 |
|Gains on property disposals |8.3 |12.6 |
|Operating revenue |93.3 |153.5 |(39)
|Depreciation and amortisation |(4.7) |(3.9) |
|Other operating expenses |(64.8) |(49.6) |
|Operating profit (EBIT) |23.8 |100.0 |(76)
|Finance costs |(9.6) |(20.5) |
|Expenses of Participating |(6.4) |(44.2) |
Certificates
|Profit before tax (EBT) |7.8 |35.4 |(78)
|Taxes on income |(2.1) |(6,7) |
|Consolidated net profit |5.7 |28.7 |(80)

Property information as at 31 December 2008

|Number of properties |263 |
|Total lettable space (m2) |1,511,400 |
|- Austria |339,900 |
|- Germany |602,700 |
|- CEE |568,800 |
|Property portfolio at fair value (EURm) |1,778.0 |
|Occupancy rate |91% |
|Average rental yield |6.7% |

end of announcement euro adhoc
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ots Originaltext: Sparkassen Immobilien AG
Im Internet recherchierbar: http://www.presseportal.de

Further inquiry note:

Investor Relations:

Rebecca Reichmann

Tel.: +43(0)50100-27402

Fax: +43(0)05100-927402

mailto:rebecca.reichmann@s-immoag.at

wwww.sparkassenimmobilienag.at

Corporate Communications:

Bosko Skoko

Tel.: +43(0)50100-27522

Fax: +43(0)05100-927522

mailto:bosko.skoko@s-immoag.at

wwww.sparkassenimmobilienag.at

Branche: Real Estate
ISIN: AT0000652250
WKN: 065225
Index: ATX Prime, Immobilien-ATX
Börsen: Wiener Börse AG / official market