Results of Operations
Overview
All in all, Vonovia’s performance was in line with expectations in the first half of 2023.
We saw ongoing high demand for rental apartments and positive economic development in the core Rental segment in the first six months of the year.
The expected impact of the war in Ukraine and its implications, particularly with regard to energy and construction costs, as well as higher interest rates, were also reflected in the interim financial statements for the other segments.
Any analysis of the figures for the first half of 2023 has to consider the fact that the prior-year figures are reported based on the current segmentation, and that the indicators that are relevant from a corporate management perspective, namely Adjusted EBITDA Total and Group FFO, are reported in line with the current definition.
Vonovia had 15,764 employees as of June 30, 2023 (June 30, 2022: 15,845).
The following key figures provide an overview of Vonovia’s results of operations and the relevant drivers in the first half of 2023.
Key Figures on Results of Operations
in € million | H1 2022 | H1 2023 | Change in % | 12M 2022 | ||||
Total Segment Revenue | 3,102.0 | 2,925.7 | -5.7 | 6,256.9 | ||||
Revenue in the Rental segment | 1,570.5 | 1,606.4 | 2.3 | 3,163.4 | ||||
Revenue in the Value-add segment | 637.4 | 619.8 | -2.8 | 1,272.0 | ||||
Revenue in the Recurring Sales segment | 295.2 | 141.4 | -52.1 | 543.4 | ||||
Revenue in the Development segment | 462.0 | 414.2 | -10.3 | 998.0 | ||||
Revenue in the Care segment | 136.9 | 143.9 | 5.1 | 280.1 | ||||
Adjusted EBITDA Total | 1,405.8 | 1,338.3 | -4.8 | 2,763.1 | ||||
Adjusted EBITDA Rental | 1,111.7 | 1,198.2 | 7.8 | 2,233.5 | ||||
Adjusted EBITDA Value-add | 83.9 | 44.1 | -47.4 | 126.7 | ||||
Adjusted EBITDA Recurring Sales | 82.3 | 37.0 | -55.0 | 135.1 | ||||
Adjusted EBITDA Development | 84.9 | 23.8 | -72.0 | 183.2 | ||||
Adjusted EBITDA Care | 43.0 | 35.2 | -18.1 | 84.6 | ||||
Group FFO | 1,066.6 | 964.8 | -9.5 | 2,035.6 | ||||
Monthly in-place rent in €/m² | 7.44 | 7.58 | 1.9 | 7.49 | ||||
Average area of own apartments in the reporting period (in thou. m²) | 34,616 | 34,380 | -0.7 | 34,525 | ||||
Average number of own units (number of units) | 551,390 | 548,358 | -0.5 | 550,342 | ||||
Vacancy rate Vonovia (in %) | 2.2 | 2.2 | – | 2.0 | ||||
Maintenance expenses and capitalized maintenance Rental segment (€/m²) | 10.89 | 9.11 | -16.3 | 24.80 | ||||
thereof expenses for maintenance (€/m²) | 6.21 | 6.02 | -3.1 | 12.85 | ||||
thereof capitalized maintenance (€/m²) | 4.68 | 3.09 | -34.0 | 11.95 | ||||
Number of units bought | 893 | 63 | -92.9 | 969 | ||||
Number of units sold | 17,748 | 1,282 | -92.8 | 19,760 | ||||
thereof Recurring Sales | 1,349 | 628 | -53.4 | 2,710 | ||||
thereof Non Core/other | 16,399 | 654 | -96.0 | 17,050 | ||||
Number of new apartments completed | 1,103 | 1,193 | 8.2 | 3,749 | ||||
thereof own apartments | 511 | 962 | 88.3 | 2,071 | ||||
thereof apartments for sale | 592 | 231 | -61.0 | 1,678 | ||||
Number of employees (as of June 30/Dec. 31) | 15,845 | 15,764 | -0.5 | 15,915 | ||||
Total segment revenue came to € 2,925.7 million in the first six months of 2023, down by 5.7% on the figure of € 3,102.0 million reported in the prior-year period. This decline was due primarily to lower proceeds from the sale of real estate inventories and lower sales in the Recurring Sales segment due to volume-related aspects.
Total Segment Revenue
Total Segment Revenue | ||||||||
in € million | H1 2022* | H1 2023 | Change in % | 12M 2022 | ||||
Rental income | 1,573.0 | 1,609.3 | 2.3 | 3,168.1 | ||||
Other income from property management unless included in the operating expenses in the Rental segment | 56.9 | 65.9 | 15.8 | 118.3 | ||||
Other income from property management from the Care segment | 136.9 | 143.8 | 5.0 | 280.1 | ||||
Income from disposals Recurring Sales | 277.9 | 137.2 | -50.6 | 515.7 | ||||
Internal revenue Value-add | 579.8 | 553.4 | -4.6 | 1,152.4 | ||||
Income from disposal of properties | 380.5 | 222.5 | -41.5 | 588.4 | ||||
Fair value Development to hold | 97.0 | 193.6 | 99.6 | 433.9 | ||||
Total Segment Revenue | 3,102.0 | 2,925.7 | -5.7 | 6,256.9 | ||||
- *Prior-year figures for Deutsche Wohnen adjusted to new segment definition.
The overview below shows the other key figures for the company’s results of operations, as well as their reconciliation to the performance indicator Group FFO:
Group FFO
Group FFO | ||||||||
in € million | H1 2022* | H1 2023 | Change in % | 12M 2022 | ||||
Revenue in the Rental segment | 1,570.5 | 1,606.4 | 2.3 | 3,163.4 | ||||
Expenses for maintenance | -215.1 | -207.0 | -3.8 | -443.6 | ||||
Operating expenses in the Rental segment | -243.7 | -201.2 | -17.4 | -486.3 | ||||
Adjusted EBITDA Rental | 1,111.7 | 1,198.2 | 7.8 | 2,233.5 | ||||
Revenue in the Value-add segment | 637.4 | 619.8 | -2.8 | 1,272.0 | ||||
thereof external revenue | 57.6 | 66.4 | 15.3 | 119.6 | ||||
thereof internal revenue | 579.8 | 553.4 | -4.6 | 1,152.4 | ||||
Operating expenses in the Value-add segment | -553.5 | -575.7 | 4.0 | -1,145.3 | ||||
Adjusted EBITDA Value-add | 83.9 | 44.1 | -47.4 | 126.7 | ||||
Revenue in the Recurring Sales segment | 295.2 | 141.4 | -52.1 | 543.4 | ||||
Fair value of properties sold adjusted to reflect effects not relating to the period from assets held for sale in the Recurring Sales segment | -203.7 | -97.1 | -52.3 | -391.6 | ||||
Adjusted result Recurring Sales | 91.5 | 44.3 | -51.6 | 151.8 | ||||
Selling costs in the Recurring Sales segment | -9.2 | -7.3 | -20.7 | -16.7 | ||||
Adjusted EBITDA Recurring Sales | 82.3 | 37.0 | -55.0 | 135.1 | ||||
Revenue from disposal of Development to sell properties | 363.2 | 218.3 | -39.9 | 560.6 | ||||
Cost of Development to sell | -292.0 | -195.7 | -33.0 | -440.4 | ||||
Gross profit Development to sell | 71.2 | 22.6 | -68.3 | 120.2 | ||||
Fair value Development to hold | 97.0 | 193.6 | 99.6 | 433.9 | ||||
Cost of Development to hold** | -68.2 | -179.4 | >100 | -340.6 | ||||
Gross profit Development to hold | 28.8 | 14.2 | -50.7 | 93.3 | ||||
Rental revenue in the Development segment | 1.8 | 2.3 | 27.8 | 3.5 | ||||
Operating expenses in the Development segment | -16.9 | -15.3 | -9.5 | -33.8 | ||||
Adjusted EBITDA Development | 84.9 | 23.8 | -72.0 | 183.2 | ||||
Revenue in the Care segment | 136.9 | 143.9 | 5.1 | 280.1 | ||||
Expenses for maintenance | -2.9 | -2.6 | -10.3 | -7.0 | ||||
Operating expenses in the Care segment | -91.0 | -106.1 | 16.6 | -188.5 | ||||
Adjusted EBITDA Care | 43.0 | 35.2 | -18.1 | 84.6 | ||||
Adjusted EBITDA Total | 1,405.8 | 1,338.3 | -4.8 | 2,763.1 | ||||
FFO interest expense | -236.4 | -297.6 | 25.9 | -493.8 | ||||
Current income taxes FFO | -60.1 | -66.8 | 11.1 | -145.0 | ||||
Consolidation*** | -42.7 | -9.1 | -78.7 | -88.7 | ||||
Group FFO | 1,066.6 | 964.8 | -9.5 | 2,035.6 | ||||
Group FFO after non-controlling interests | 1,025.6 | 919.6 | -10.3 | 1,944.3 | ||||
- *Prior-year figures adjusted to new adjusted EBITDA definition (excluding results from at-equity investments), adjustments to Adjusted EBITDA Rental: € 4.3 million, adjustments to Adjusted EBITDA Value add: € 0.5 million. In the course of the fourth quarter of 2022, the Deutsche Wohnen segment was dissolved and transferred to the Rental, Value-add, Recurring Sales, Development and Care segments. Previous year’s values for H1 2022 updated accordingly.
- **Excluding capitalized interest on borrowed capital in H1 2023 of € 0.5 million (H1 2022: € 0.0 million), 12M 2022: € 2.5 million.
- ***Thereof intragroup losses in H1 2023: € +5.1 million (H1 2022: € -13.7 million), 12 M 2022 intragroup losses: € +4.8 million, gross profit development to hold in H1 2023: € -14.2 million (H1 2022: € -28.9 million), 12M 2022: € -93.3 million.
As of June 30, 2023, Vonovia managed a portfolio comprising 548,080 of its own residential units (June 30, 2022: 549,484), 165,085 garages and parking spaces (June 30, 2022: 163,558) and 8,779 commercial units (June 30, 2022: 8,873). 70,436 residential units (June 30, 2022: 72,362) are also managed for other owners.