Business performance
HIAG increased its net income in business year 2021 by 61.8% to CHF 89.3 million (previous year: CHF 55.2 million). At CHF 60.5 million (previous year: CHF 27.0 million), revaluation gains more than doubled. Property income rose by 5.7% to CHF 63.1 million (previous year: CHF 59.7 million). At CHF 16.5 million (previous year: CHF 4.9 million), income from the sale of investment properties reflected the efficient implementation of the ongoing divestment programme of non-strategic properties. The successfully executed capital increase in November 2021 with a net cash flow of about CHF 156 million had a positive impact on the equity ratio and the loan to value-ratio (LTV).
Financial performance
- At CHF 63.1 million (previous year: CHF 59.7 million), property income exceeded the previous year’s figure by CHF 3.4 million. With agreed and expected rent reductions of about CHF 0.1 million, the pandemic did not have a significant impact on net income.
- The vacancy rate in the real estate portfolio decreased further to 10.7% (previous year: 13.2%) as at 31 December 2021, despite the sale of fully leased properties. This positive development can be explained primarily by successful new leases and lease extensions as well as acquisition of leased properties.
- Revaluation gains from investment properties rose considerably during the reporting year to CHF 60.5 million (previous year: CHF 27.0 million), mainly thanks to in-house development progress and a further reduction in the current market discount rates.
- Profit from the sale of investment properties increased to CHF 16.5 million (previous year: CHF 4.9 million). The above-average figure is due primarily to the successful execution of the current divestment programme of non-strategic properties.
- Other operating income rose to CHF 14.1 million (previous year: CHF 12.5 million), due in particular to the higher earnings contribution of the metal recycling company Jaeger & Bosshard to CHF 10.5 million (previous year: CHF 5.9 million).
HIAG’s net income increased by 61.8% to CHF 89.3 million (previous year: CHF 55.2 million) in business year 2021. Net income amounted to CHF 37.0 million (previous year: CHF 33.4 million), excluding revaluation gains and related deferred taxes. Also, EBIT increased significantly to CHF 115.1 million (previous year: CHF 69.9 million), or CHF 54.6 million (previous year: CHF 42.9 million), excluding revaluations. This resulted in earnings per share of CHF 10.39 (previous year: CHF 6.82), or CHF 4.31 (previous year: 4.12), excluding revaluations and related deferred taxes (based on a weighted average number of shares outstanding).
Return on equity as at 31 December 2021 rose by 3.4 percentage points from 7.7% to 11.1% (on a weighted average equity basis).
in TCHF |
2021 |
2020 |
∆ in % |
Property income |
63,142 |
59,738 |
5.7% |
Revaluation of properties |
60,523 |
27,002 |
124.1% |
Income from sale of properties |
– |
10,560 |
-100.0% |
Profit from sale of properties |
16,543 |
4,905 |
237.3% |
Other operating income |
14,114 |
12,531 |
12.6% |
EBIT |
115,128 |
69,859 |
64.8% |
EBIT excl. Revaluation of real estate |
54,605 |
42,857 |
27.4% |
Financial result |
–9,157 |
–8,592 |
6.6% |
Taxes |
–16,708 |
–6,107 |
173.6% |
Net income for the period |
89,263 |
55,159 |
61.8% |
Net income for the period excl. ravaluation of real estate and defferred taxes |
36,995 |
33,352 |
10.9% |
Yielding portfolio (leases)
At CHF 63.1 million (previous year: CHF 59.7 million), property income exceeded that of the previous year by 5.7%. With agreed and expected rent reductions of about CHF 0.1 million, the impact of the pandemic on the result was negligible.
Annualised property income rose by 5.1% to CHF 63.1 million (previous year: CHF 60.0 million), taking into account strategic transactions (acquisitions, sales) from which HIAG earned annualised property income of CHF 1.0 million net.
The vacancy rate in the real estate portfolio continued to decrease and stood at 10.7% (previous year: 13.2%) at 31 December 2021. The vacancy rate in the yielding portfolio dropped to 9.6% (previous year: 13.0%).
The weighted average unexpired lease term (WAULT) increased to 8.2 years (previous year: 7.9 years) during the reporting period. Based on the 15 largest tenants, the WAULT was as much as 10.2 years (previous year: 6 years) as at 31 December 2021.
Development portfolio
HIAG’s development pipeline includes more than 60 projects with an expected total investment volume of about CHF 2.98 billion. The annual earnings potential of rental space is approximately CHF 167 million and the potential proceeds from promotional project sales equals approximately CHF 580 million (planned/estimated over the next 15 years).
During the period under review, two properties in Niederhasli (“Doka Schweiz”) and Meyrin (“Luigia”) with a net market value of CHF 52.6 million were transferred from the development portfolio to the yielding portfolio. In the previous year, yielding properties with a net market value of CHF 62.2 million were transferred to the development portfolio, while development properties with a net market value of CHF 21.9 million were transferred to the yielding portfolio.
The vacancy rate in the development portfolio rose from 13.7% in the previous year to 15.7% during the reporting period. This is due primarily to the strategic sale of a fully-leased property in Aigle, as well as the above-mentioned transfer of properties from the development portfolio to the yielding portfolio.
Transaction business
The following properties with a fair value of CHF 62.4 million (previous year: CHF 27.1 million) were sold during the period under review:
- Aathal, Zürichstrasse 66–80, 50–62/19
- Aathal, Zürichstrasse 34 (cotton warehouse)
- Wetzikon, Grundstrasse 6–10
- Wetzikon, Schulhausstrasse 42-44
- Biberist, Herrenweg 1–7 / Derendingerstrasse
- Basel, Rosenthalstrasse 27
- Bremgarten, Luzernerstrasse 48-50
- Windisch, Kunzareal, Parkplätze
- Aigle, Route Industrielle 18 (Orlons)
At the same time, the following properties with a fair value of CHF 39.7 million (previous year: CHF 9.1 million) were acquired in 2021 as part of an asset deal:
- Reinach (BL), Am Kägenrain 1–3
- Winterthur, St. Gallerstrasse 172
- Winterthur, Technoramastrasse 15
- Solothurn, Muttenstrasse 13–18
Furthermore, a property was acquired in Buchs (AG) as part of a share deal in the amount of CHF 53.0 million (previous year: no share deal).
At CHF 60.5 million (previous year: CHF 27.0 million), revaluation gains from real estate assets more than doubled. This increase is due to the progress of projects in development properties, a reduction in the vacancy rate and a market-related decrease in discount rates.
The average discount rate (net, real) applied by the independent real estate appraiser to the valuations was 3.54% (previous year: 3.73%) in the real estate portfolio (excluding land, construction rights and power plants).
Properties for sale (promotion) – earnings contribution and developments
As at 31 December 2021, the development pipeline included a property for sale (“CHAMA” condominium) with a total investment volume of CHF 2.7 million (previous year: CHF 2.5 million). No divestments were made in 2021 (previous year: net income: CHF 1.4 million).
Operating expenses
Operating expenses decreased by CHF 5.8 million to CHF 38.7 million (previous year: CHF 44.5 million) in the reporting period. This is mainly a result of one-time effects in the previous year related to expenses from the sale of properties, the Pratteln site and the Cloud business. Real estate-related expenses dropped by CHF 0.6 million in the period under review.
As at 31 December 2021, HIAG had 77 (previous year: 85) employees. The eight-person decrease is due primarily to the end of employment contracts related to the completion of the dismantling work in Pratteln.
Personnel expenses amounted to CHF 13.9 million (previous year: CHF 16.5 million) during the reporting period.
Operating and administrative expenses decreased slightly to CHF 7.2 million (previous year: CHF 7.6 million).
Tax expense rose to CHF 16.7 million (previous year: CHF 6.1 million) due primarily to a higher operating profit, increased proceeds from the sale of investment properties (including deferred taxes), an increase in deferred taxes from revaluation and the use of capitalised tax loss carry forwards from previous periods.
Financial position
- The balance sheet total as at 31 December 2021 rose to CHF 1.90 billion (previous year: CHF 1.69 billion).
- The equity ratio increased to 52.0% (previous year: 45.0%).
The balance sheet total as at 31 December 2021 increased by 12.5% to CHF 1.90 billion (previous year: CHF 1.69 billion). The value of the real estate portfolio as the most important element of the balance sheet rose by 8.9% to CHF 1.78 billion (previous year: CHF 1.64 billion) due to investments, revaluation gains and strategic transactions.
in TCHF |
31.12.2021 |
31.12.2020 |
∆ in % |
Balance sheet total |
1,903,643 |
1,691,378 |
12.5% |
Sharholders' equity |
988,999 |
761,122 |
29.9% |
NAV per share, without deferred taxes in CHF |
106 |
99 |
6.7% |
NAV per share, with deferred taxes in CHF |
98 |
91 |
8.1% |
Real estate portfolio |
1,784,429 |
1,637,844 |
8.9% |
During business year 2021, the NAV increased by 8.1% to CHF 98.06 per share (previous year: CHF 90.72 per share), or by 6.7% to CHF 106.08 per share (previous year: CHF 99.43 per share), taking into account deferred taxes.
Following the successful capital increase in November 2021 and with an equity ratio of 51.9% (previous year: 45.0%) as at 31 December 2021, HIAG’s equity base stands on solid ground.
As at 31 December 2021, the gross loan-to-value ratio (LTV) was reduced to 44.5% (previous year: 49.9%) and the net LTV ratio to 39.6% (previous year: 48.7%). HIAG thus has a solid base to finance its financial obligations from operating activities.
Financial liabilities
On 2 July 2021, a CHF 100 million fixed-rate bond was refinanced with a CHF 160 million fixed-rate bond with a coupon of 0.75% and a term of 7 years.
On 31 December 2021, financial liabilities consisted of listed bonds (CHF 700 million) and mortgage-backed bank loans (CHF 93 million). In business year 2021, the average interest rate for financial liabilities of 0.8% was below the comparable figure of the previous year (0.9%) due to the successful refinancing of the bond in July and the repayment of bank loans from the proceeds of the capital increase in the fourth quarter of 2021. HIAG’s goal is to keep interest rates at a low level if possible.
The average term of the financial liabilities was 2.5 years (previous year: 2.0 years) as at the reporting date on 31 December 2021. The objective is to extend this period with the upcoming refinancing in 2022. The long-term financing and the solid equity base form the foundation of HIAG’s successful development.
in TCHF |
31.12.2021 |
31.12.2020 |
∆ in % |
Total financial liabilities |
792,887 |
816,686 |
-2.9% |
Average remaining term of financial liabilities in years |
2.5 |
2.0 |
25.0% |
Average borrowing rate in % |
0.8% |
0.9% |
-11.1% |
Investments
HIAG’s investment activity is focused on the strategic implementation of the project pipeline, which as at 31 December 2021 comprised more than 60 projects with a total investment volume of approximately CHF 2.98 billion (previous year: CHF 2.75 billion).
Rico Müller
CFO