Reconciliation of Financial Result/FFO Interest Expense

The financial result for the first nine months of 2017 improved considerably, namely by € 135.9 million, as against the figure for the first nine months of 2016, coming in at € -218.2 million. This is due primarily to the repayment of financing in the course of 2016. In addition, the prior-year figures were hit by transaction costs and prepayment penalties in connection with the repayment of portfolio loans. FFO 1 interest expense is derived from the financial result as follows:

Reconciliation of Financial Result to FFO Interest Expense

in € million

 

9M 2017

 

9M 2016

 

Change in %

 

12M 2016

 

 

 

 

 

 

 

 

 

*

Excluding income from other investments

**

Interest on the difference between the taking up and making use of the € 3 billion bonds from December 2015, which were intended to be used for the financing of the Deutsche Wohnen acquisition.

Income from non-current loans

 

1.6

 

1.4

 

14.3

 

1.9

Interest income

 

25.1

 

10.5

 

139.0

 

14.1

Interest expense

 

-244.9

 

-366.0

 

-33.1

 

-449.0

Financial result*

 

-218.2

 

-354.1

 

-38.4

 

-433.0

 

 

 

 

 

 

 

 

 

Adjustments:

 

 

 

 

 

 

 

 

Transaction costs

 

6.1

 

21.2

 

-71.2

 

21.5

Prepayment penalties and commitment interest

 

3.8

 

66.5

 

-94.3

 

64.4

Effects from the valuation of non-derivative financial instruments

 

-22.2

 

-26.4

 

-15.9

 

-31.0

Derivatives

 

-8.9

 

3.1

 

 

12.9

Interest accretion to provisions

 

6.5

 

8.6

 

-24.4

 

11.2

Accrued interest

 

36.0

 

16.9

 

113.0

 

-7.9

Other effects

 

1.0

 

1.4

 

-28.6

 

0.6

Net cash interest

 

-195.9

 

-262.8

 

-25.5

 

-361.3

 

 

 

 

 

 

 

 

 

Accrued interest adjustment

 

-36.0

 

-16.9

 

113.0

 

7.9

Adjustments EMTN interest**

 

 

21.0

 

 

21.1

Adjustments Income from investments in other real estate companies

 

13.0

 

9.6

 

35.4

 

9.6

Interest payment adjustment due to taxes

 

2.4

 

 

 

FFO interest expense

 

-216.5

 

-249.1

 

-13.1

 

-322.7

Due to refinancing and lower interest rates, FFO interest expense came to € -216.5 million in the first nine months of 2017, down by 13.1% on the value for the prior-year period of € -249.1 million.