By Andrea Figueras
Shares in LEG Immobilien have experienced a boost as the company announced a rise in earnings for the second quarter. At 1226 GMT on Thursday, shares were up 4.3% at EUR65.54.
Strong Performance in Key Earnings Indicator
LEG Immobilien, a German real-estate company, revealed that its adjusted funds from operations (FFO) for the second quarter more than doubled to 63.7 million euros ($69.9 million), compared to EUR28.4 million in the same period last year. Furthermore, its quarterly rental income saw a growth of 4.7% to reach EUR208 million.
Upgraded Full-Year Targets
In addition to the positive second-quarter results, LEG Immobilien confirmed that it has upgraded its full-year targets. The company now expects its adjusted FFO to range between EUR165 million and EUR180 million, as opposed to the previous forecast of between EUR125 million and EUR140 million. It also maintained its estimate for rental growth between 3.8% and 4%, which was initially projected to range from 3.3% to 3.7%.
Continued Success in Sales Program
Despite market constraints in the residential property sector, LEG Immobilien reported selling almost 700 housing units during the first half of the year. The company's sales program includes more than 5,000 units in total.
Focus on Debt Reduction
With its operations on track, LEG Immobilien should now concentrate on reducing its debt. According to research note by Berenberg analysts Kai Klose and Nithin Kumar Devaraj, an acceleration and increase in asset sales might help the company achieve this goal.