Original-Research: Coreo AG - von GBC AG

Einstufung von GBC AG zu Coreo AG

Unternehmen: Coreo AG

Anlass der Studie: Research study (Anno) 1
Empfehlung: BUY
Kursziel: 1.30 EUR
Kursziel auf Sicht von: 31.12.2024
Letzte Ratingänderung: 
Analyst: Cosmin Filker, Marcel Goldmann

- FY 2022 was marked by portfolio optimisation
- Postponed investments should be realised in 2024
- Break-even expected from 2024
In the past financial year 2022, Coreo AG's focus was on active asset
management of the existing portfolio, whereas no new investments were made
for the first time since the start of real estate-related business
activities. In particular, the delay of the acquisition of the largest
portfolio in the company's history, which had been planned since 2021, was
responsible for this. In this respect, the focus of business activities was
on extensive refurbishments and conversion measures at existing properties
in Kiel, Wetzlar or Bruchsal.
Nevertheless, a significant increase in gross rental income to EUR 5.97
million (previous year: EUR 4.35 million) was achieved, in particular due to
the first full-year inclusion of properties acquired in 2021. In addition,
rental increases were achieved in the existing portfolio and vacancies in
the refurbished properties were reduced. On the other hand, proceeds from
disposals fell to EUR2.89 million (previous year: EUR10.32 million). These
primarily include the complete sale of the Mannheim portfolio and some
properties in the Göttingen portfolio. As a result, total income of EUR10.38
million (previous year: EUR16.53 million) was below the previous year's
level, but above our expectations (GBC forecast: EUR7.99 million) due to
higher than expected proceeds from disposals.
The decline in earnings is also reflected in the drop in EBIT to EUR 0.98
million (previous year: EUR 2.84 million). This was lower than we expected
due to higher maintenance measures (GBC forecast EBIT: EUR 2.63 million).
Based on this, Coreo AG was once again unable to reach break-even at the
level of the after-tax result. At present, the company's rental income is
still too low to cover its operating expenses, but it is still not
sufficient to cover its financial expenses.
The current P&L picture should only change with the expected expansion of
the rental portfolio. One possible property acquisition that is likely to
have a relevant influence on the company's revenue and earnings development
is the transfer of the so-called Spree East portfolio, for which a purchase
agreement was already reached in 2021. According to the company's
announcement at the time, the portfolio comprises a total of 1,341 flats
and 15 commercial units, which would make it the largest acquisition in the
history of Coreo AG. Although the company is currently still in
negotiations, we assume that the acquisition will not take place until the
coming financial year 2024. Likewise, an exclusive agreement for the
purchase of a portfolio in Hagen/Rostock with an investment volume of EUR 2.5
million was concluded in July 2022.
Assuming the expected addition of these portfolios and after taking into
account further investments in the coming financial years, rental income,
which will then be the most important earnings variable, should gradually
increase to EUR 6.53 million (2023e), EUR 9.56 million (2024e) and EUR 12.36
million (2025e). From the coming financial year onwards, these should be
enough to reach the break-even point at the level of the after-tax result.
Within the framework of our DCF valuation model, we have determined a new
target price of EUR 1.30 (previously: EUR 1.85). Compared to our previous
valuation, we have made a significant forecast adjustment. On the one hand,
we expect a slower build-up of the portfolios. On the other hand, rental
income is more important than in our previous forecasts. Compared to the
trading business, this is accompanied by lower revenues, but at the same
time there should be higher profitability. The weighting of capital costs
is also shifting towards debt capital, which has led to a reduction in the
WACC. We continue to give the rating BUY.

Die vollständige Analyse können Sie hier downloaden:

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Date and time of completion: 14.07.2023 (08:47 am)
Date and time first distribution: 14.07.2023 (11:30 am)

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