Eurobank Properties REIC announced that its 2006 profits before tax have increased by 72.5% compared to those of 2005 year (32.4m Euro for 2006 vs 18.8m Euro for 2005).
Income from rentals increased by 28.7%, and there was a significant increase in interest income from deposits (1.7m in 2006 vs 0.25m in 2005). The Company benefited from its re-organisation into a REIC since, as a result of the re-organisation, finance costs were reduced by 33.2%.
Taking into account the applied tax expense / benefit of each period, net profits for 2006 amounted to Euro 31.3m as opposed to Euro 27.1m for 2005. It is stressed that in 2005, due to the Company''s transformation into a REIC, the Company''s net profits benefited from the reversal of the deferred tax provision (non-cash item) of 10.9m Euro resulting in an "accounting" increase. If we do not take into account the aformentioned reversal, Company''s net profits increased by 93.8%.
The positive trend in the Company''s financial figures for the fiscal year 2006 had as a result that the Company''s Board of Directors, during yesterday''s meeting, decided to propose the distribution of dividend which will be higher by 78% than the dividend paid out for the fiscal year 2005. Specifically, the Board of Directors decided to propose the distribution of Euro 0.64 per share, based on the Company''s distributable profits (after the deduction of the regular reserve) for the year ended 31.12.2006, compared to Euro 0.36 per share for 2005. The ex-interim dividend date and the commencement of the interim dividend payment will be announced following Board of Directors'' relevant resolution.
The management of the Company anticipates a further increase in its profits as rental inflow from the significant recent investments in Nea Ionia, Moschato and Vrilissia has already partially begun.. It is reminded that following the Company''s IPO, the latter has proceeded with a total investment of Euro 48.2m in
(a) office building in Moschato, Southern Athens with market value at the date of the acuisition of Euro 10.2m;
(b) three independent buildings of office and conference centre use and a number of car park spaces that are situated within a building complex in Nea Ionia, Attica with market value at acquisition time of Euro 27.35m; and
(c) retail building in Vrilissia, Northern Athens with market value at the date of acquisition of Euro 2.17m.
It must be stressed that the Company has managed to absorb more than half the proceeds from the IPO within eight months.
At the same time, negotiations for various projects related to the use of the remaining IPO proceeds continue. It is noted that the company''s investment strategy for future growth focuses on the acquisition of office, retail, logistics and industrial spaces in prime locations, taking into consideration the prevailing market conditions.