Warimpex Q1 2016: Significant improvement in result for the period

Microsoft Word - 20150530_WPX_PI_Q12016_en_final P R E S S R E L E A S E Warimpex Q1 2016: Significant improvement in result for the period

• Hotel operations stable, Investment Properties revenues increase to EUR 1.9 million due to completions in St. Petersburg and Budapest
• Improvement in financial result from minus EUR 3.9 million to plus EUR 0.2 million
• Loss for the period of EUR 0.5 million considerably better than in Q1 2015
• Development projects in St. Petersburg, Krakow, and Łódź
• Letter of intent signed for hotel sale - deal expected to close in mid-2016

Vienna/Warsaw, 30 May 2016 - The first quarter of 2016 brought stable development in the hotel operations of Warimpex Finanz- und Beteiligungs AG, with occupancy and room rates remaining constant. However, the hotel sales concluded last year in Ekaterinburg and the resulting drop in the number of rooms led to a 7 per cent decline in revenues in the Hotels segment to EUR 9.4 million. In contrast, revenues from the Investment Properties segment increased from EUR 0.4 million to EUR 1.9 million due to the completion and letting of the Zeppelin office tower at AIRPORTCITY St. Petersburg and of the Erzsébet office building in Budapest. As a result, total revenues improved by 8 per cent in year-on-year terms to EUR 11.9 million. Gross income from revenues also rose by 63 per cent to roughly EUR 4 million.

However, EBITDA fell from EUR 1.6 million to EUR 0.8 million due to exchange rate gains from operations in the prior-year period, while EBIT remained relatively stable at minus EUR 0.5 million. The financial result including earnings from joint ventures climbed into positive territory, increasing from minus EUR 3.9 million to plus EUR 0.1 million. All in all, this led to a loss for the period of EUR 0.5 million, which marks an improvement over the comparison period (2015: loss of EUR 5.3 million).

"The Russian economy remains in a slump and the rouble is still subject to major fluctuations, although it experienced a slight recovery in the first quarter of 2016. Conditions are not expected to stabilise until 2017. As announced at the end of 2015, we are already confident that the appreciation of the currency will allow us to make up non-cash foreign currency losses," said Franz Jurkowitsch, CEO of Warimpex. "Another point worth noting is that the first three months of the year are traditionally the weakest in terms of revenues for the hotel industry due to seasonal effects and are not representative of the development of revenues for the full year."

Current developments in Poland and Russia

In the Development segment, progress is being made on the projects in Russia and Poland. Warimpex recently obtained the building permit for the development of an office building with 26,000 square metres of

space near the andel's Łódź. Depending on tenant demand, the implementation of the project will start soon. In Krakow, Warimpex is working on the development of two office buildings. The first is an office building with around 26,000 square metres of space that will be built on a plot next to the Chopin Hotel, and the second is a building owned by Warimpex that is to be demolished and replaced by a new office building with approximately 20,000 square metres of space. A parking garage with 20,000 square metres of space is under construction at AIRPORTCITY St. Petersburg. In May 2016, a long-term preliminary lease agreement was signed for the entire building.

Outlook for 2016

"Our goal for the 2016 financial year is to boost the earnings of our hotels across the portfolio, to cut interest expenses, and to move forward with our development projects. Once again, we plan to complete a number of transactions this year and we signed a letter of intent for the sale of a hotel after the reporting period. The deal is expected to close at the middle of the year," reported Jurkowitsch.

Key financial figures for the first quarter of 2016 at a glance (as at 31 March 2016)

in EUR '000	1-3/2016	Change	1-3/2015
Hotels revenues	9,353	- 7%	10,069
Investment Properties revenues	1,902	413%	371
Development and Services revenues	602	14%	527
Total revenues	11,857	8%	10,966
Expenses directly attributable to revenues	- 7,885	- 8%	- 8,533
Gross income from revenues	3,973	63%	2,433
Gains or losses from the disposal of properties	-	-	- 1,376
EBITDA	833	- 49%	1,629
Depreciation, amortisation, and remeasurement	- 1,287	- 40%	- 2,158
EBIT	- 455	- 14%	- 529
Earnings from joint ventures	- 709	350%	- 158
Profit or loss for the period	- 463	-	- 5,337
Net cash flow from operating activities	2,303	14%	2,014
Segment information (including joint ventures on a proportionate basis):
Hotels revenues	15,308	- 21%	19,383
Hotels net operating profit (NOP)	2,782	- 25%	3,712
NOP per hotel room	990	- 9%	1,094
Investment Properties revenues	2,088	274%	559
Investment Properties EBITDA	1,518	470%	266
Development and Services revenues	732	11%	660
Gains or losses from the disposal of properties	-	-	- 1,376
Development and Services EBITDA	- 1,528	-	492

Warimpex Finanz- und Beteiligungs AG at a glance

Warimpex Finanz- und Beteiligungs AG is a real estate investment and development company. The firm is headquartered in Vienna and is listed on the stock exchanges in Vienna and Warsaw (WXF). As one of the largest hotel investors in Central and Eastern Europe, Warimpex currently owns, partially owns, or operates 15 business and luxury hotels with 3,700 rooms in total as well as five commercial and office buildings with a total useable area of roughly 42,000 square metres. Over the past 25 years, Warimpex has developed properties worth over one billion euros. Warimpex believes in quality and sustainability as the basis for strong future growth.

Warimpex is active in seven countries in Europe. The top hotels that the firm owns, partially owns, or operates include the andel's hotel in Łódź, angelo hotels in Prague, Plzeň, and Katowice, the angelo Airporthotel in Bucharest, the Kempinski hotel in Vienna, the Crowne Plaza hotel at AIRPORTCITY in St. Petersburg, and the InterContinental hotel in Warsaw.

Contact: Warimpex Finanz- und Beteiligungs AG Christoph Salzer, presse@warimpex.com Daniel Folian, investor.relations@warimpex.com Tel. +43 1 310 55 00

www.warimpex.com

Ecker & Partner Öffentlichkeitsarbeit und Public Affairs GmbH

Nicole Bäck, Barbara Hirsch presse@warimpex.com

Tel. +43 1 599 32 23