CORESTATE has withdrawn its outlook for financial year 2020 due to the COVID-19 pandemic. Considering the significant shift in investment decisions, transactions and valuation approaches in core markets and products that can be expected, the Company believes it is unlikely that it will achieve its originally planned and published financial targets for this financial year.
Revenues are expected to fall short of expectations, particularly in the areas of acquisition and performance-based fees as well as warehousing and alignment capital.
Luxemburg, 22 April, 2020. Corestate Capital Holding S.A. (Corestate), a leading independent real estate investment manager in Europe, has withdrawn its outlook for financial year 2020 due to the COVID-19 pandemic. Considering the significant shift in investment decisions, transactions and valuation approaches in core markets and products that can be expected, the Company believes it is
unlikely that it will achieve its originally planned and published financial targets for this financial year. Revenues are expected to fall short of expectations, particularly in the areas of acquisition and performance-based fees as well as warehousing and alignment capital.
Given the uncertainty surrounding the course of the COVID-19 pandemic, further strengthening of the liquidity position is currently a priority. Corestate will therefore propose to the Annual General Meeting that no dividend be distributed for financial year 2019. The future dividend payout ratio is also being adjusted from 2021 on, and thus for the first time for financial year 2020; it is to be at least 30 percent of earnings per share (EpS). The objective is to reduce the Company´s net financial debt in the medium term and mitigate any cyclical and other external risks to the business model. With regard to its debt, Corestate is positioned for the long term, and the next refinancing need will be at the end of 2022 at the earliest.
Lars Schnidrig, CEO Corestate: “The highly dynamic nature of the Corona pandemic is forcing us to adjust our growth-oriented planning for 2020 and to make ourselves crisis-proof at all levels. We have already identified a number of measures with concrete savings potential and are strongly focused on expanding our liquidity base. The one-time waiving of the dividend is sensible from an entrepreneurial
standpoint. This will enable us to continue to operate from a position of strength.”
Corestate will publish a new financial outlook for the financial year 2020 as soon as the effects of the COVID-19 pandemic can be reliably assessed and resilient planning is possible. The Company believes that all key market drivers of the business model are intact for the medium term, which means Corestate should be able to return starting in 2021 to pre-crisis earnings and profitability figures once the investment market returns to normal.
Nils Hübener, CIO Corestate: “Our clients are currently reluctant to enter into new commitments, however practically all of them are still looking for profitable and sustainable real estate investments, which we offer in a custom-tailored manner. Especially for our core products that are based on megatrends and focus on the residential segment, we expect to see a rapid recovery once the crisis has been overcome, from which we will then benefit disproportionately due to our leading market position. In the coming quarters attractive investment opportunities are also likely to open up, which we intend to exploit in an opportunistic manner.”
Lars Schnidrig then concluded: “We are in an excellent strategic position, and I am therefore firmly convinced that Corestate will in 2021 return to its usual strength in terms of operations and earnings following the crisis. In addition, we will again position ourselves as a high-growth dividend stock in the coming year with a more conservative but still very attractive dividend policy.”
About CORESTATE Capital
CORESTATE is an investment manager and co-investor with around € 28 billion in assets under management. The company sees itself as a manager for the entire length of the real estate value chain. Thanks to its fully integrated real estate platform, it is able to offer investors a wide range of services, especially the opportunity to invest in large-scale societal trends such as urbanisation, demographic shifts or sustainability – trends that will continue to have a decisive influence on the living and working environment in the long term. The consistent focus on asset classes that will be successful in the long run constitutes a central cornerstone of the company strategy. At CORESTATE, all concepts are supported with ESG expertise that is unique to the industry. With some 800 experts, CORESTATE offers clients and investors a full range of services and consultation from a single source, from project financing and real estate management to sales. CORESTATE is listed on the Frankfurt Stock Exchange (SDAX) and operates as a respected business partner for institutional and semi-institutional investors as well as high-net-worth private investors in 13 countries across Europe, with offices in Frankfurt, Vienna, Zurich, Paris, Madrid and London.
Forward-looking statements
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