EANS-Adhoc: ECO Business-Immobilien AG / positive operating earnings and trend reversal in valuation

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23.11.2009

ECO Business-Immobilien AG: positive operating earnings and trend
reversal in valuation

Vienna, 23 November 2009. ECO Business-Immobilien AG (Vienna Stock
Exchange / Prime Market: ECO) carried out a re-dimensioning programme
during the first nine months of 2009 as a reaction to the economic
and financial crisis. The optimisation of the portfolio through the
sale of individual properties led to a substantial reduction in net
debt and an increase in the equity ratio to 41.5%. Following a trend
reversal in valuations during the third quarter of this year, EBIT
for the period 1-9/2009 was clearly positive at EUR 5.3 million
(1-9/2008: EUR 7.5 million).

ECO recorded rental income of EUR 38.2 million for the first three
quarters of 2009. As expected, this figure was lower than the
comparable prior year period (EUR 45.8 million) due to the sale of
portfolio objects. Income from the disposal of non-current assets
fell to EUR 0.3 million (1-9/2008: EUR 3.6 million) because the
proceeds from the sale of properties only exceeded the IFRS carrying
values by a slight margin.

The third quarter brought a turnaround in the valuation trend. After
the recognition of impairment charges totalling EUR -25.3 million in
the first half of this year, the valuation of the ECO property
portfolio by independent experts showed an increase of EUR 6.8
million for the third quarter. Revaluation results for the first nine
months of 2009 amounted to EUR -18.6 million, which represents an
improvement over the comparable prior year figure of EUR -23.6
million. Earnings before interest and taxes (EBIT) were clearly
positive despite the non-cash charges from the first six months and
totalled EUR 5.3 million for the reporting period (1-9/2008: EUR 7.5
million). Earnings before interest, taxes, depreciation and
amortisation (EBITDA) equalled EUR 23.8 million for the first three
quarters (1-9/2008: EUR 31.1 million).

A reduction in debt and generally lower interest rates supported an
improvement in financial results to EUR -16.0 million (1-9/2008: EUR
-32.9 million). Profit before tax equalled EUR -10.7 million, which
represents a substantial improvement over the prior year (1-9/2008:
EUR -25.4 million). Profit after tax amounted to EUR -8.3 million,
compared with EUR -18.7 million in the first nine months of 2008.

The sale of properties by ECO during the reporting period was
responsible for a decline in the balance sheet total from EUR 1.1
billion at the end of 2008 to EUR 855.9 million as of 30 September
2009. The reduction of liabilities supported an improvement in the
equity ratio from 33.7% at the end of 2008 to 41.5% as of 30
September 2009, and also reduced net debt from EUR 701.6 million at
year-end 2008 to EUR 466.3 million. The loan-to-value (LTV) ratio was
57.3% at the end of September 2009. Cash and cash equivalents rose
from EUR 14.6 million on 31 December 2008 to EUR 18.5 million as of
30 September 2009. Net asset value (NAV) per share equalled EUR 10.37
at the end of September 2009, compared with EUR 10.80 on 31 December
2008.

ECO concentrated on property sales and selected redevelopment
projects during the first nine months of 2009. The streamlined ECO
property portfolio comprised 61 objects with 538,800 m² of rentable
space and a total value of EUR 816.8 million as of 30 September 2009
(EUR 1,074.2 million at year-end 2008). Average rents (EUR 10.5/m² in
the office sector and EUR 9.6/m² in the retail sector) remained
nearly unchanged in comparison with year-end 2008.

Four objects in the investment portfolio, representing 5% of total
property assets, were under redevelopment during the third quarter of
2009. ECO took advantage of the high vacancy rate in these buildings
(approx. 68%) to carry out modernisation projects and thereby meet
the changing demands of tenants. In this way ECO is following the
typical lifecycle for retail properties and making preparations for a
future increase in earnings and value through upgrading and new
rentals. The occupancy rate of the other objects in the investment
portfolio averaged approx. 90% in spite of the adverse market
climate, reflecting the level at year-end 2008.

Plans for the fourth quarter of 2009 call for the sale of further
properties in Austria. In addition, ECO will continue its
redevelopment projects for the modernisation of selected objects. No
new development projects are scheduled at the present time. The
properties in the investment portfolio will be optimised through an
improvement in both furnishings and structure. These measures should
increase the occupancy level and thereby stabilise rental income.
This, in turn, will safeguard the company`s liquidity and should also
support the continued generation of positive cash earnings from
operations.

The Management Board expects results for 2009 will show significant
growth in the equity ratio. Operating earnings should also increase
due to the trend reversal in valuation. The continuing low level of
interest rates and reduction in debt are expected to produce a
year-on-year improvement in financial results. On the basis of the
measures implemented during the first three quarters - the
optimisation of the portfolio, strengthening of liquidity, protection
of financing over the long-term and reduction in debt - ECO is well
positioned to master any continuation of the difficult operating
environment and to profit from growth opportunities when the market
recovers.

Selected Company Data in accordance with IFRS

1-9/2009 1-9/2008
Revenues (TEUR) 46,771 55,424
Thereof rental income (TEUR) 38,206 45,838
Income from the disposal of non-current assets (TEUR) 292 3.600
Net gain/(loss) from changes
in the fair value of investment properties (TEUR) -18,554 -23,638
Earnings before interest, tax,
depreciation and amortisation (EBITDA) (TEUR) 23,836 31,132
Operating profit (EBIT) (TEUR) 5,253 7,452
Profit before tax (EBT)(TEUR) -10,740 -25,419
Profit after tax (after minority interests)(TEUR) -8,226 -16,807

Earnings per share (EUR) -0.24 -0.49
Weighted average number of shares (Stk.) 34,100,000 34,100,000

FFO (funds from operations)
before interest and taxes1)(TEUR) 603 38,982
Cash earnings (FFO - funds from operations)
after interest and taxes2)(TEUR) -15,429 5,981

NAV per share as of the balance sheet date (EUR) 10.37 11.83

1) EBIT + depreciation and amortisation +/- fair value adjustments
+/- impairment charges 2) EBIT + depreciation and amortisation +/-
fair value adjustments +/- impairment charges - financial results -
income taxes paid

Balance Sheet Data

Consolidated balance sheet - summary in TEUR
30/09/2009 31/12/2008
Non-current assets 827,906 1,085,709
Thereof investment properties 777,992 981,890
Thereof properties under construction 38,768 40,421
Current assets 28,021 27,904
Total assets 855,927 1,113,614
Equity and reserves 355,438 375,113
Thereof minority interests 1,881 6,918
Non-current liabilities 439,209 470,846
Current liabilities 61,279 267,654
Total equity and liabilities 855,927 1,113,614

Property Data
30/09/2009 30/09/2008
Number of objects 61 123
Thereof investment portfolio 59 72
Thereof trading portfolio 0 45
Thereof development projects 2 6
Rentable space in m²* 538,800 666,200
Garage spaces (number) 2,840 3,570
Property assets (in TEUR) 816,760 1,094,828
Thereof properties under construction 38,768 46,301

* Garage spaces were included at 20 m² each / parking areas included

This press release includes forward-looking estimates and statements
that are based on the information available to ECO
Business-Immobilien AG at the present time. Forward-looking
statements are normally described with terms such as "expect",
"estimate", "plan", "anticipate", "assume", "should", "could", etc.,
and reflect conditions at the time they are made. ECO notes that
numerous factors may cause actual circumstances and, therefore also
actual results, to differ from the expectations described in this
press release.

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

Further inquiry note:

ECO Business-Immobilien AG

Friedrich Scheck, CEO

Tel.: +43(1)580 88 12

mailto:scheck@eco-immo.at

Peter Pechar

Head of Investor Relations

Tel.: +43(1)580 88 35

mailto:pechar@eco-immo.at

Q-COM Financials

Roland Mayrl

Tel.: +43(1) 504 69 87-331

mailto:r.mayrl@qcom.at

Branche: Real Estate
ISIN: AT0000617907
WKN: A0D8RY
Index: Prime Market
Börsen: Wien / Regulated free trade