Business Development in 2016 – An Overview

Our business development in the 2016 fiscal year was very successful overall, as is evident from our key performance indicators.

In general, it is important to bear in mind that the business figures for 2016 include all of the acquisitions made in 2015 with an earnings contribution for the months from January to December 2016. These figures are compared with the business figures for the previous year, in which GAGFAH was only included with an earnings contribution for the months from March to December 2015, Franconia was included with an earnings contribution for the months from April to December 2015 and SÜDEWO was included with an earnings contribution for the months from July to December 2015.

In detail, our performance indicators at Group level (most meaningful performance indicators within the meaning of DRS 20) are as follows:



Actual 2015


Last forecast for 2016 in the Interim Financial Report for Q3 2016


Actual 2016








Adjusted NAV/share


€ 24.19


approx. € 30


€ 30.75

EPRA NAV/share


€ 30.02


approx. € 36


€ 36.58



€ 608.0 million


approx. € 760 million


€ 760.8 million

FFO 1/share


€ 1.30


approx. € 1.63


€ 1.63



Increase of 2.8%


Increase of more than 5%


Increase of 8.0%

The adjusted NAV per share came in at € 30.75 in 2016, up by 27.1% on the prior-year value of € 24.19 and by 2.5% on the most recent forecast of around € 30. This corresponds to an per share of € 36.58 (2015: € 30.02, last forecast approx. € 36). This increase was due primarily to the net income from adjustments of investment properties of € 3,236.1 million (2015: € 1,323.5 million).

FFO 1 rose by € 152.8 million to € 760.8 million in 2016 (2015: € 608.0 million), slightly ahead of the most recent forecast of around € 760 million. This corresponds to an per share of € 1.63 (2015: € 1.30, last forecast approx. € 1.63). The improvement in was the main factor behind the increase in . It rose by € 136.4 million, from € 957.6 million in 2015 to € 1,094.0 million. The interest expense excluding non-recurring items (FFO interest expense) came to € -322.7 million in 2016, down by 4.9% on the prior-year value of € -339.4 million and, as a result, slightly above the most recent forecast of around € -320 million.

We were also able to further improve our customer satisfaction. With growth of 8%, we outperformed our target for 2016 of a planned increase in the CSI of more than 5%.

Statement of the Management Board on the Economic Situation

The net assets, financial position and results of operations of the Group are extremely positive, particularly given the solid financing, the resulting balanced maturity profile and the financing flexibility gained through the -backed bond financings with a view to both organic and external growth. Steady improvements to the property management processes promote ongoing improvements in profitability.

The presentation of the NAV based on the EPRA definition aims to show the net asset value in a long-term business model. The equity attributable to Vonovia’s shareholders is adjusted to reflect deferred taxes on investment properties/assets held for sale, the fair value of derivative financial instruments and the deferred taxes on derivative financial instruments. In order to boost transparency, an adjusted NAV, which involves eliminating goodwill in full, is also reported.
Fair Value
Valuation pursuant to IAS 40 in conjunction with IFRS 13. The estimated value of an asset. The fair value is the amount for which an asset could be exchanged between knowledgeable, willing parties in an arm’s length transaction.
The profit or loss for the period to reflect the adjusted profit or loss from sales; period adjustments from assets held for sale; specific effects that do not relate to the period, are non-recurring or do not relate to the objective of the company; the net income from fair value adjustments of investment properties; depreciation and amortization; deferred and prior-year current taxes (tax expenses/income); transaction costs; prepayment penalties and commitment interest; valuation effects on financial instruments; the unwinding of discounting for provisions, particularly provisions for pensions, and other prior-year interest expenses and income that are not of a long-term nature.
Adjusted EBITDA Operations
The adjusted EBITDA Operations is calculated by subtracting the adjusted EBITDA Sales from the adjusted EBITDA of the Group.
FFO (Funds From Operations)
FFO reflects the recurring earnings from the operating business. In addition to adjusted EBITDA, FFO allow for recurring cash-effective net interest expenses from non-derivative financial instruments as well as income taxes. This key figure is not determined on the basis of any specific international reporting standard but is to be regarded as a supplement to other performance indicators determined in accordance with IFRS.
Classification of debtors or securities with regard to their creditworthiness or credit quality according to credit ratings. The classification is generally performed by rating agencies.