PHN Group Generated Rental Income of PLN 92.4M for H1 2024

PHN Group closed the first half of 2024 with revenue of PLN 304.3M, which, after taking into account administrative and sales expenses, translated into a net sales profit of PLN 62.4M. Thanks to rental income from new commercial space, the result on rental improved significantly compared to the same period of 2023 (up 34.1%).

With the rental income from new space, including SKYSAWA and INTRACO Prime, PHN Group reported an increase in revenue from its key business segment, i.e. rental income, by PLN 28.7M in H1 2024, up 24.3% year-on-year. Rental income increased from PLN 68.9M in H1 2023 to PLN 92.4M in H1 2024 (up 34.1%).

In H1 2024, EBITDA amounted to PLN 2.9M and was PLN 45.2M (107%) higher than in H1 2023. Adjusted EBITDA (EBITDA adjusted for the change in the fair value of properties and the result on their disposal, damages and penalties in the rental segment) amounted to PLN 66.1M and was PLN 21.9M higher than in H1 2023 (49.5%).

At the same time, in H1 2024, PHN Group reported a net loss of PLN 76.0M, mainly as a result of a negative change in the fair value of properties in the amount of PLN 63.3M and a loss on financing activities of PLN 56.1M, resulting from the servicing of debt financing. This result was PLN 8.7M lower than in the same period of last year.

“As previously announced, PHN Group’s primary objectives, in addition to the constant increase in the scale of operations, include further improvement of the rental result as well as growth of development activities. While commercial rental income improved significantly in the first half of 2024, the activity in the development segment had a marginal impact, which was caused by the investment cycle of pending residential projects. Nevertheless, we are optimistic about the future and are currently finishing two investment projects: KOLEJ na 19 in Warsaw and Osiedle ŁAN in Wrocław, which will allow us to provide approx. 240 apartments in the near future, for which PHN Group has already concluded development agreements. Further residential projects are under construction and in the pipeline. I am convinced that thanks to the implemented changes, we will improve the profitability and financial situation of PHN Group in the coming quarters,” said Wiesław Malicki, President of the Management Board of Polski Holding Nieruchomości.

In H1 2024, PHN Group continued its investment program in the office, residential and logistics real estate sectors. In January 2024, PHN Group launched the VENA office development, which will provide the market with more than 15,000 sqm of modern rental space. Due to investors’ interest in the purchase of this land, PHN Group is considering selling it. Further decisions concerning the property will depend on the proposed transaction terms and the results of the ongoing investment analysis. In the pipeline is the MARINA by PHN project in Gdynia. Currently, three more residential projects are also under construction, namely: Młoda Białołęka II, Osiedle Olimpijczyk II, and Willa Pana Tadeusza. The projects will provide more than 430 apartments in Warsaw, Łódź and Kraków. In the coming months, PHN Group plans to launch more investments, including in new regional markets – the pipeline includes a several-stage project in Bydgoszcz on Nakielska Street and a cosy development in downtown Warsaw. In addition, the prestigious residential project in Gdynia will be continued. In the logistics sector, PHN Group plans to develop more projects – under the JV formula in Zgorzelec and in Pruszków, which will provide the market with more than 300,000 sqm of modern warehouse space.

The process of in-depth analysis of the real estate portfolio is also being continued. In July, PHN Group announced a new offer, with selected properties assigned for residential rental and for sale. Apartments in attractive locations, with varying sizes and functional room layouts, have been assigned for rent. On the other hand, the assets which, after thorough evaluation, do not fit the target structure of the portfolio have been assigned for sale. Due to their nature, location, small area or limited expansion possibilities, they can hardly be considered strategic for the PHN Group.

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ABOUT THE PHN GROUP

Polski Holding Nieruchomości S.A is one of the largest groups in the Polish commercial property sector in terms of the market value of its portfolio. PHN Group has a diversified business profile – it is primarily active in the office, residential and logistics markets. PHN Group’s portfolio comprises more than 150 standalone properties with a market value of approx. PLN 3.5B. PHN Group provides comprehensive rental and management services – it currently manages more than 500,000 sqm of leasable space. PHN Group owns about 270 hectares of land earmarked for projects in various market segments. PHN Group is also active in the construction sector – by providing general contracting, subcontracting and design services, as well as in the development sector as an investor – by carrying out projects related to the construction and sale of residential units and the construction of commercial buildings. PHN Group’s main market is Poland. PHN’s activities in the rental segment are concentrated primarily in Warsaw and the largest regional cities, including the Tri-City, Poznań, Cracow, Katowice, Łódź and Wrocław. PHN has been listed on the Warsaw Stock Exchange since 13 February 2013.