DGAP-News: Grand City Properties S.A. / Key word(s): Half Year Results/Real Estate Grand City Properties S.A.: ANNOUNCES H1 2016 RESULTS WITH HIGH PROFITABILITY ARISING FROM VALUE MATERIALIZATION 17.08.2016 / 06:50 The issuer is solely responsible for the content of this announcement. --------------------------------------------------------------------------- THIS ANNOUNCEMENT IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA, JAPAN, SOUTH AFRICA OR ANY OTHER JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF APPLICABLE LAWS OR REGULATIONS GRAND CITY PROPERTIES S.A. ANNOUNCES H1 2016 RESULTS WITH HIGH PROFITABILITY ARISING FROM VALUE MATERIALIZATION - Rental and operating income at EUR209 million, a 46% increase to YOY - EBITDA increased 107% YOY to EUR487 million - Adjusted EBITDA up 44% YOY, amounted to EUR107 million for H1 2016 - FFO I for the first six months of 2016 increased to EUR76 million, 40% YOY - FFO I per share EUR0.50 and FFO I after perpetual notes attribution at EUR0.44 per share (up 11% and 7% YOY, respectively) - Net profit reached EUR392 million, 101% increase to H1 2015; earning per share at EUR2.10, 43% increase YOY - Equity at EUR2.7 billion, up 23% since year-end 2015; Equity ratio at 47% - EPRA NAV including perpetual notes increased to EUR3 billion, EPRA NAV EUR2.5 billion - LTV at 39%, down from 42% as of December 2015 - Maintaining a conservative financial position with ICR of 6.0x, and DSCR of 4.7x - Like-for-like occupancy growth at 3.2% p.a., l-f-l in-place rent growth at 2.3% p.a. In view of positive portfolio developments and cash flow robustness the Board Directors updates two key policies: - LTV limit decreased to 45% on a sustainable basis from 50% - Dividend policy of 50% of FFO I starting from the next dividend payment in 2017, from previously 30% Luxembourg, August 17, 2016 - Grand City Properties S.A. (the "Company") closes the first half of 2016 with a momentum of successful operational growth, achieving high profitability with EUR392 million net profit and an FFO of EUR76.1 million. The portfolio increased to 82 thousand as of August 2016, generating an annualized rental and operating income run rate of EUR440 million and an FFO I run rate of EUR159 million. Operational improvement impacts the top and bottom lines, resulting in significant value creation Maintaining a strong trend of increasing occupancy across the portfolio, the total vacancy rate on rentable area has gone down to 8.3% as of August 2016. Rent contribution of newly occupied units, as well as income from newly acquired units, are contributing strongly to GCP's top and bottom line. The adjusted EBITDA increased in the first half year to EUR107 million, a 44% increase to the comparable period in 2015, confirming GCP's capability to successfully operate an increasing portfolio, while further extracting the operational potential of its existing portfolio. As a result of the increasing operational profits and the improvement of the portfolio, GCP has recorded EUR379 million gains for the first half of 2016. Following the high profitability, as of June 30, 2016 the EPRA NAV amounted to EUR2.5, or EUR3bn including the perpetual notes. As of June 2016 GCP further strengthened its financial position with an LTV of 39% and an equity ratio of 47%. The Board of Directors has decided on further reducing the conservative internal LTV limit to 45%, from previously 50%. Additionally, GCP has updated the Company's dividend policy to 50% of the FFO I from previously 30%. Christian Windfuhr, CEO of Grand City Properties: "Grand City Properties is maintaining its good momentum in extracting the high upside potential embedded in its portfolio. The cash flow generation quality of our portfolio keeps increasing, allowing us to confidently increase the profit distribution to our shareholders, as the liquidity level and debt service strength of the Company improve, and we position ourselves to steer GCP towards further profitability". The full H1 2016 interim report is available on the Company's website: http://www.grandcityproperties.com/en/downloads.html About the Company: Grand City Properties is a specialist real estate company focused on investing in and managing value-add opportunities in the real estate property market in Germany, primarily in densely populated areas. The Company's strategy is to improve its properties through targeted modernization and intensive tenant management, and then create value by subsequently raising occupancy and rental levels. Further information: www.grandcityproperties.com Grand City Properties (ISIN: LU0775917882) is a public limited liability company (société anonyme) incorporated under the laws of the Grand Duchy of Luxembourg, having its registered office at 24, Avenue Victor Hugo, L 1750 Luxembourg and being registered with the Luxembourg trade and companies register (Registre de Commerce et des Sociétés Luxembourg) under number B 165 560. Since May 2012, Grand City Properties is listed on the Frankfurt Stock Exchange. Contact: Grand City Properties S.A. 24, Avenue Victor Hugo L-1750 Luxemburg T: +352 28 77 87 86 E: [email protected] www.grandcityproperties.com Press Contact: Katrin Petersen Grand City Properties S.A. T: +49 (30) 374-381 5218 E: [email protected] Disclaimer: THIS ANNOUNCEMENT DOES NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY ANY SECURITIES. THE SECURITIES MENTIONED IN THIS ANNOUNCEMENT HAVE NOT BEEN, AND WILL NOT BE, REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES ABSENT REGISTRATION OR AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT. THERE WILL BE NO PUBLIC OFFERING OF THE SECURITIES IN THE UNITED STATES. THIS ANNOUNCEMENT IS DIRECTED AT AND IS ONLY BEING DISTRIBUTED IN THE UNITED KINGDOM TO (I) PERSONS WHO HAVE PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS FALLING WITHIN ARTICLE 19(5) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005 (THE "ORDER"), (II) HIGH NET WORTH ENTITIES, AND OTHER PERSONS TO WHOM IT MAY OTHERWISE LAWFULLY BE COMMUNICATED FALLING WITHIN ARTICLE 49 OF THE ORDER, AND (III) PERSONS TO WHOM IT MAY OTHERWISE LAWFULLY BE COMMUNICATED (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS "RELEVANT PERSONS"). THIS COMMUNICATION MUST NOT BE READ, ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS. ANY INVESTMENT OR INVESTMENT ACTIVITY TO WHICH THIS ANNOUNCEMENT RELATES IS AVAILABLE ONLY TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS. IN MEMBER STATES OF THE EUROPEAN ECONOMIC AREA ("EEA"), THIS ANNOUNCEMENT AND ANY OFFER IF MADE SUBSEQUENTLY IS DIRECTED ONLY AT PERSONS WHO ARE "QUALIFIED INVESTORS" WITHIN THE MEANING OF ARTICLE 2(1)(E) OF DIRECTIVE 2003/71/EC, AS AMENDED (THE "PROSPECTUS DIRECTIVE") ("QUALIFIED INVESTORS"). ANY PERSON IN THE EEA WHO ACQUIRES THE SECURITIES IN ANY OFFER (AN "INVESTOR") OR TO WHOM ANY OFFER OF THE SECURITIES IS MADE WILL BE DEEMED TO HAVE REPRESENTED AND AGREED THAT IT IS A QUALIFIED INVESTOR. ANY INVESTOR WILL ALSO BE DEEMED TO HAVE REPRESENTED AND AGREED THAT ANY SECURITIES ACQUIRED BY IT IN THE OFFER HAVE NOT BEEN ACQUIRED ON BEHALF OF PERSONS IN THE EEA OTHER THAN QUALIFIED INVESTORS, NOR HAVE THE SECURITIES BEEN ACQUIRED WITH A VIEW TO THEIR OFFER OR RESALE IN THE EEA TO PERSONS WHERE THIS WOULD RESULT IN A REQUIREMENT FOR PUBLICATION BY THE COMPANY OR ANY OF THE MANAGERS OF A PROSPECTUS PURSUANT TO ARTICLE 3 OF THE PROSPECTUS DIRECTIVE. THIS ANNOUNCEMENT MAY CONTAIN PROJECTIONS OR ESTIMATES RELATING TO PLANS AND OBJECTIVES RELATING TO OUR FUTURE OPERATIONS, PRODUCTS, OR SERVICES, FUTURE FINANCIAL RESULTS, OR ASSUMPTIONS UNDERLYING OR RELATING TO ANY SUCH STATEMENTS, EACH OF WHICH CONSTITUTES A FORWARD-LOOKING STATEMENT SUBJECT TO RISKS AND UNCERTAINTIES, MANY OF WHICH ARE BEYOND THE CONTROL OF GRAND CITY PROPERTIES S.A. ACTUAL RESULTS COULD DIFFER MATERIALLY, DEPENDING ON A NUMBER OF FACTORS. --------------------------------------------------------------------------- 17.08.2016 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG. The issuer is solely responsible for the content of this announcement. The DGAP Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Archive at www.dgap.de --------------------------------------------------------------------------- Language: English Company: Grand City Properties S.A. 24, Avenue Victor Hugo 1750 Luxembourg Grand Duchy of Luxembourg Phone: +352 28 77 87 86 Fax: +352 28 77 87 84 Internet: http://grandcityproperties.com ISIN: LU0775917882, XS1036325527, XS1130507053, XS1191320297, XS1199992196, XS1220083551, WKN: A1JXCV , A1ZD10, A1ZRRK, A1ZW4K, A1ZYA8, A1ZZ49 Listed: Regulated Unofficial Market in Berlin, Dusseldorf, Hamburg, Hanover, Munich, Stuttgart, Tradegate Exchange; Open Market (Entry Standard) in Frankfurt ; Luxemburg End of News DGAP News Service --------------------------------------------------------------------------- 493403 17.08.2016