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Investing.com -- Aroundtown (ETR:AT1) shares rose more than 2% on Wednesday after the real estate group reaffirmed its full-year guidance and reported flat recurring earnings for the first quarter of 2025.
Funds from operations stood at €76.3 million, or €0.07 per share, unchanged from the prior year.
The result is in line with the company’s confirmed full-year guidance of €280 million to €310 million, or €0.26 to €0.28 per share. The midpoint implies a 7% decline from 2024 levels, according to Morgan Stanley (NYSE:MS).
Rental income rose 3% on a like-for-like basis. Residential assets recorded the strongest performance, up 4.5%, with vacancy stable at 3.5%.
Hotels increased 3.7%, with vacancy unchanged at 2.6%. Office properties rose 1.6%, and the vacancy rate improved 10 basis points to 12.6%. The overall vacancy rate declined by 90 basis points year over year to 7.5%.
Net rental income increased 0.6% to €295 million. Adjusted EBITDA rose 1.5% to €251.1 million. Jefferies called the results “virtually stable,” noting that higher perpetual note costs offset operational improvements.
Aroundtown said it revalued 15% of its portfolio during the quarter, resulting in a 0.8% like-for-like increase in asset values.
EPRA net tangible asset (NTA) per share rose 3% quarter over quarter to €7.63, also up 3% from the previous year. Morgan Stanley said this places the shares at a 64% discount to NAV.
During the quarter, the company closed €149 million in disposals at an 18x rent multiple, equal to a 5.6% yield.
Barclays (LON:BARC) noted the sales were near book value. The company achieved the same yield on €740 million of disposals in 2024. Meanwhile, the average portfolio rental yield decreased 10 basis points to 5.0%.
Vendor loan exposure declined to €330 million from €550 million at the end of 2024.
Barclays said the reduction came from a mix of repayments and asset takeovers. Remaining loans carry an interest rate of about 5%.
Leverage remains high. Aroundtown’s reported loan-to-value (LTV) ratio fell 1 percentage point to 41%.
This excludes hybrid bonds and is not proportionally consolidated. The EPRA LTV, which includes hybrids as debt and uses proportional consolidation, declined to 59%, down 1 point.
Morgan Stanley noted this is based on a 4.0% EPRA net initial yield for a portfolio in which offices make up 38% of gross asset value.
Net debt to EBITDA decreased to 10.5x from 10.7x at year-end. Interest coverage rose to 4.3x from 4.0x. The average cost of debt was unchanged at 2%, with an average maturity of 3.7 years.