Financials

UNAUDITED FINANCIAL STATEMENTS ANNOUNCEMENT FOR THE THIRD QUARTER AND NINE MONTHS ENDED 30 SEPTEMBER 2017

Financials Archive

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Profit or Loss

Profit and Loss

Balance Sheet

Balance Sheet

Commentary

Sustained economic growth, healthy employment and favourable business prospects have continued to support the office sector in Germany, both in terms of leasing and investment.

During the quarter, one of IREIT’s key tenants at Concor Park has exercised its prolongation option to extend its lease for another three years, one year ahead of its lease expiry in September 2018.

As IREIT progresses into the final quarter of 2017, it has undertaken further hedging in respect of its distribution for FY2018. To date, an amount of equivalent to about 80% of the annualised income distribution for FY2017(1) has been hedged at an average hedge rate of approximately S$1.63 per Euro, compared to S$1.55 per Euro for FY2017. In order to better manage its foreign currency risk exposure and provide more clarity to unitholders, IREIT have established a formal currency hedging policy for its income to be repatriated from overseas to Singapore starting from FY2019. This policy will be based on the use of currency forwards on a quarterly basis to hedge approximately 80% of the expected EUR-denominated income to be repatriated, one year in advance.

The €23.6 million term loan facility provided by HSH Nordbank AG has been restructured in early 2017. The first of the four quarterly repayments of €1.275 million each has been made in August 2017. The gradual reduction in borrowings via loan amortisation will improve the loan-to-value of IREIT’s assets and strengthen its balance sheet.

Looking ahead, IREIT will continue to seek to enhance its long-term income by investing in incomeproducing quality assets across Europe. It intends to execute a growth strategy based on four pillars, namely seeking diversification, taking a long-term approach, achieving economies of scale, and having a local presence.

Footnotes:

  1. Annualised income distribution for FY2017 is derived by extrapolating on a straight-line basis the income to be distributed of €17.45 million for the three quarters ended 30 September 2017 to the full four quarters of 2017.