Financing
According to publications dated May 7, 2018, and August 2, 2018 (which already include the acquisitions of BUWOG and Victoria Park), Vonovia’s credit rating as awarded by the agency Standard & Poor’s is unchanged at ‘BBB+’ with a stable outlook for the long-term corporate credit rating and ‘A-2’ for the short-term corporate credit rating. At the same time, the credit rating for the issued and unsecured bonds is ‘BBB+.’
A European medium-term notes program (EMTN program) has been launched for the Group via Vonovia Finance B.V., allowing funds to be raised quickly at any time using bond issues, without any major administrative outlay. The prospectus for the EMTN program has to be updated annually and approved by the financial supervisory authority of the Grand Duchy of Luxembourg (CSSF).
Vonovia Finance B.V. has currently placed a total bond volume of € 14.8 billion, € 12.4 billion of which relates to the EMTN program on the reporting date of March 31, 2019. The total volume also includes € 1.7 billion in hybrid bonds, € 1.0 billion of which is reported as equity.
In November 2017, Vonovia concluded a master commercial paper agreement via its Dutch financing company with a total volume of € 500 million with Commerzbank AG as lead arranger and several banks as traders. This master program was increased to a total volume of € 1,0 billion in September 2018.
The debt maturity profile of Vonovia’s financing was as follows as of March 31, 2019:
Maturity Profile
With effect of January 29, 2019, and as part of its EMTN program, Vonovia placed a bond with a nominal volume of € 500 million and a coupon of 1.800% maturing on June 29, 2025, via its Dutch subsidiary Vonovia Finance B.V. The first interest payment is due on June 29, 2019.
In connection with the issue of unsecured bonds by Vonovia Finance B.V., Vonovia has undertaken to comply with the following standard market covenants:
- Limitations on incurrence of financial indebtedness
- Maintenance of consolidated coverage ratio
- Maintenance of total unencumbered assets
The existing structured and secured financing arrangements also require adherence to certain standard market covenants. Any failure to meet the agreed financial covenants could have a negative effect on the liquidity status.
The LTV (loan to value) is as follows as of the reporting date:
in € million |
Dec. 31, 2018 |
Mar. 31, 2019 |
Change in % |
||
|---|---|---|---|---|---|
|
|||||
|
|
|
|
||
Non-derivative financial liabilities |
20,136.0 |
20,879.7 |
3.7 |
||
Foreign exchange rate effects |
-33.5 |
-38.2 |
14.0 |
||
Cash and cash equivalents |
-547.7 |
-1,873.2 |
>100 |
||
Net debt |
19,554.8 |
18,968.3 |
-3.0 |
||
Sales receivables |
-256.7 |
-24.6 |
-90.4 |
||
Adjusted net debt |
19,298.1 |
18,943.7 |
-1.8 |
||
|
|
|
|
||
Fair value of the real estate portfolio |
44,239.9 |
44,543.0 |
0.7 |
||
Shares in other real estate companies |
800.3 |
127.4 |
-84.1 |
||
Adjusted fair value of the real estate portfolio |
45,040.2 |
44,670.4 |
-0.8 |
||
|
|
|
|
||
LTV |
42.8 % |
42.4 % |
-0.4 pp |
||
The financial covenants have been fulfilled as of the reporting date.
in € million |
Dec. 31, 2018 |
Mar. 31, 2019 |
Change in % |
|---|---|---|---|
|
|
|
|
Non-derivative financial liabilities |
20,136.0 |
20,879.7 |
3.7 |
Total assets |
49,387.6 |
50,475.4 |
2.2 |
|
|
|
|
LTV bond covenants |
40.8 % |
41.4 % |
0.6 pp |
|
|
|
|