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Investing.com -- Shares of Covivio (EPA:CVO) rose more than 3% on Monday after the French real estate group raised its full-year earnings target following a 14% increase in first-half recurring net profit.
The company now expects 2025 recurring net profit to total “around €515 million,” up 4% from its previous forecast and 3% above consensus estimates from Visible Alpha. The guidance implies 8% year-over-year growth and a 4% rise per share.
Recurring net profit rose to €263.2 million in the first six months of 2025 from €230.8 million a year earlier.
Earnings per share increased 6% to €2.38. Group share revenue climbed 8.9% to €355.7 million, with like-for-like growth of 4.9%.
Covivio cited strong operating performance, favorable financing conditions, and asset management activity as the main drivers of the upgrade.
Hotel revenue grew 14.6% on a current basis and 5.3% like-for-like, supported by the full consolidation of 2024 acquisitions.
EBITDA for hotel assets rose 11%, while like-for-like values increased 10%. Renovation projects totaling €32 million were launched at properties including the Ibis Montmartre in Paris and the Mercure Nice.
A 12-year lease was signed with Radisson Hotel Group for a 305-room hotel at Roissy Charles de Gaulle Airport, expected to boost related revenue by over 50%.
The group expanded its hotel portfolio with a €15 million acquisition in Porto and four hotel conversion projects in France and Italy totaling €240 million. Its stake in Covivio Hotels rose to 53.2% from 52.5% at end-2024.
Office revenue increased 8.9% and 4.7% like-for-like. Covivio acquired the remaining 25% stake in the CB21 tower in La Défense, gaining full ownership.
Of 44,000 square meters targeted for leasing, 6,000 were re-let, with negotiations ongoing for another 4,000.
In Milan, the company delivered the fully let 12,100-square-meter Corte Italia project, which reported a 24% value increase.
German residential revenue rose 4.8% like-for-like, up from 4.3% in 2024. Modernization investments totaled €24 million, and unit sales reached €20 million at a 35% margin. Relettings achieved a 24% rent uplift, including 36% in Berlin.
The group’s portfolio was valued at €16 billion on a group share basis and €23.6 billion at 100%, up 3.1% on a current basis and 1.5% like-for-like. German residential assets gained 3.1% in value, hotels 2.1%, and offices 0.4%.
Occupancy stood at 97.3%, including 100% for hotels, 99% for residential, and 95.5% for offices. The average firm lease term was 6.3 years.
New disposal agreements totaled €132 million group share, including €69 million in non-core offices, €31 million in residential, and €32 million in hotels.
Covivio raised €719 million in financing in the first half, including a €500 million nine-year EU Green Bond. ESG-linked debt made up 69% of total debt, up from 64% at end-2024.
The loan-to-value ratio rose to 39.8% from 38.9%, while net debt to EBITDA improved to 10.7x from 11.4x. EPRA Net Tangible Assets increased 3.5% to €80.4 per share.
The company’s market capitalization was €5.88 billion as of July 18. The stock traded between €43.40 and €56.85 over the past 12 months.