Aroundtown, a leading MDax company in the commercial real estate sector, achieved an impressive return to profitability in 2024. After a loss of nearly two billion euros in the previous year, caused by a significant depreciation of its real estate portfolio, the company managed to post a profit of nearly 53 million euros in 2024. This development is particularly noteworthy as it indicates a stabilization of the company.
Financial Highlights 2024
- Profit: Aroundtown reported a net profit of about 53 million euros, representing a significant improvement compared to the previous year.
- Net Rental Income: This decreased by one percent to 1.18 billion euros, primarily due to property sales. However, on a comparable basis, rents rose by 2.9 percent.
- Operating Profit (FFO1): The FFO1 fell by five percent to about 316 million euros, impacted by property sales and the costs associated with perpetual bonds.
Forecasts for 2025
Operating Profit (FFO1): Aroundtown expects a further decline in FFO1 for 2025 to between 280 and 310 million euros.
Revenue Forecasts: Analysts have lowered their revenue estimates for 2025 to 1.4 billion euros, which reflects a decrease of 5.6 percent compared to the previous year’s figures.
Earnings per Share: Earnings per share are expected to rise by 514 percent to 0.30 euros.
Valuation and Stock Performance
- Price-Earnings Ratio (P/E): A P/E ratio of 6.57 is expected for 2025, which is considered attractive compared to industry peers.
- Stock Performance: The Aroundtown stock has seen an impressive price increase of 30.92 percent year-on-year. However, the price still remains below its 52-week high.
- Analyst Opinions: Analyst opinions are divided. Some maintain their buy recommendation, while others are more skeptical.
Dividend
The decision regarding a potential dividend for 2025 will be made before the annual general meeting in June. The company emphasizes that further balance sheet improvements are necessary to stabilize its credit rating.
Challenges and Strategies
Aroundtown continues to plan property sales to reduce its debt and finance potential acquisitions. Despite the challenges, the company remains financially stable, with a cash reserve of 3.6 billion euros.
Overall, Aroundtown presents a complex mixture of positive and negative developments. While the return to profitability and the price increase are positive signals, uncertainties regarding the dividend and operational results remain challenges for investors.