This conference will be recorded. Good morning, ladies and gentlemen, and welcome to the Branicks Group AG Q3 Results 2025. At this time, all participants have been placed on listen-only mode. The floor will be open for questions following the presentation. Let me now turn the floor over to your host, Jasmin Dentz. Thank you, Operator. Welcome everybody to our Q3 results presentation for 2025. This call will also be webcast live on branicksgroup.com, and a replay of the call will be available on our website shortly after the end of the call. Our CEO and CFO, Sonja Wärntges, will now give you an overview of our financials and our guidance. After the presentation, we will be happy to take your questions. Please note that management comments during this call will include forward-looking statements which involve risks and uncertainties. For a discussion of risk factors, I encourage you to review the safe harbor statement contained in today's presentation. As always, all documents relating to our nine-month reporting have been made available on our website. I now turn the call over to you, Sonja. Please close your. Thank you very much, and good morning, ladies and gentlemen. Also a warm welcome from my side to Branicks Q3 2025 Results Conference Call. Today, as usual, I'm joined by my colleagues from the accounting and investor relations departments. I will give you an overview on what has been achieved in the last quarter, and I will present you our key numbers. At the end of the call, as usual, we will also offer you the possibility to raise your questions. Dear all, in terms of a rough overview about what we have delivered and achieved during the nine months of 2025, I would like to highlight the topics mentioned on slide number two. First of all, again, we achieved major milestones in terms of our financial consolidation and the reduction of our liabilities. In total, we paid back promissory notes of EUR 225 million. In the first half year 2025 and further EUR 68 million at the end of July. Our focus remains on further reducing our liabilities with a continued concentration on our governance as well as on our liquidity situation. With regards to our external disposals, we look back on successful first nine months. As per end of September 2025, we managed to sell 14 objects out of our commercial portfolio for a total of EUR 386 million. EUR 381 million of these are already closed. The remaining volume is expected to be closed by the end of this year. Branicks has strengthened its position as an active player in a still challenging transaction market. This strong momentum will carry us successfully into 2026. Our transaction pipeline is well- filled, and our transaction teams are working successfully in order to realize our 2025 target. Our commercial portfolio continues. To be a sustainable and predictable cash flow provider. Our clear strategic focus on the two asset classes, office and logistics, is once again reflected in the high percentage rate these two asset classes constitute with regards to their market value. Our portfolio continues to generate stable and predictable rents, benefiting from the rent indexation. The ongoing portfolio optimization results in a like-for-like rental growth of 1%. At the same time, we managed to increase the average rent from EUR 9.63 per sq m -EUR 10.34 per sq m. Our teams continue to successfully negotiate lease agreements, like the most recent seamless reletting in Cologne to Edutain AG as the largest single letting during 2025. With regards to our logistics asset class, the largest single letting in 2025 was a 10-year contract with the organic food company EgeSun GmbH for 26,699 sq m in the Greater Bremen area. Also for our development project, GreenBiz Park in Erding, new letting contracts of 10,000 sq m could have been arranged. In my view, these new and follow-up lettings in 2025 prove the customer proximity and attractive high-quality properties, particularly in terms of sustainability criteria and our demand, even in a challenging market environment, and are leading to dynamic business in both asset classes. With EUR 8.4 billion assets under management, our institutional business remains the second strong pillar of our business model, recording a slight like-for-like rental growth during the reporting period compared to the prior year. Thanks to our strong and solid setup within this segment, we are ready to benefit from a market upswing, particularly with regards to increasing transaction fees. Last but not least, again, we continue to be cost-sensitive and manage to generate about 6% OpEx reduction compared to last year's period. With regards to our financial maturities profile, we continue to pursue our deleveraging path. After already having reduced our financial liabilities in total by EUR 667 million in 2024. We achieved further milestones looking at the first nine months of 2025. As promised, we paid back all of our 2025 promissory notes. This means that for the remaining of the year, we only have to roll an amount of EUR 64 million. In view of our EUR 400 million Green Bond. Which is due on the 22nd of September 2026. I know that most of you are eager to learn more about our plans. Please be ensured that, of course, we have this maturity in our heads and exploiting different options in this regard. Nevertheless, it's too soon to talk about the next concrete steps. Let me underline in this context that our focus to deleverage our balance sheet while monitoring our Green Bond covenants remains one of our highest priorities. We improved the bond LTV from 57.4% as of the end of June 2025 to 56.1%, enlarging the headroom to the covenant level. We are aiming to reduce our LTV further and to achieve an even bigger headroom in the midterm. We also improved the ICR covenant from 2.3 x as of end of June to 2.6 x, also widening the headroom to the 1.8 x threshold. We also continuously improved the average interest rates during the recent quarters from 2.67% as of end of December to 2.37% as of end of September 2025. Let's now have a deeper look in the results of our real estate platform shown on slide number four. Our like-for-like rental income remains strong and rose by 0.3% for the entire portfolio under management. This means an increase of 1% for the commercial portfolio. A slight plus of 0.1% within our institutional business. Again, rent increases were realized primarily through indexations. In terms of square meters, the letting performance of the Branicks platform increased in the first nine months by 18% year-on-year to 256,500 sq m. The total letting performance for the first nine months of the year consists of 113,900 sq m of new leases and 142,600 sq m of renewals of existing leases. In total, assets under management with EUR 10.7 billion were slightly down compared to last year, mostly due to disposals which became effective in the course of the year. The commercial portfolio saw a decrease of EUR 3.2 billion, down to EUR 2.3 billion, which was the direct result of the disposal activities year-on-year. The institutional business was also affected by the termination of a larger property management mandate. As of today, only 1.7% of the total annualized rental income would expire in 2025. If lease contracts—oh, sorry—would expire in 2025 only if lease contracts are not prolonged. Over 89% of annualized rental income has a lease length until 2027 and longer. For larger expiries in 2025 - 2026, we already proactively started the discussions with the tenants. On our next slide, let me highlight the development of our main income streams. Net rental income decreased to EUR 96.3 million due to the disposals. Income from associated companies that mainly consisted of deferred income from fund shares decreased to EUR 3.2 million. As the market remains challenging, the real estate management fees were at a solid level of EUR 30.2 million. Apart from recurring asset and property management fees and development fees, this number also includes fees generated from transactions. The decrease is partly driven by the termination of the asset management mandate in the VIB Retail Balance I Fund at the end of 2024. Our income from rents and management fees on the platform, with EUR 126.5 million, is lower compared to prior year but still showing a very high degree of recurring income streams. Now let's take a closer look on the development of the FFO year-on-year that is overall in line with our expectations. The most important number is the reduction of the interest expenses reflected in the net interest results, with an improvement of EUR 36 million, coming along with less adjustments for consulting costs and fees for the financial consolidation. In total, and to sum it up, we see the FFO amounting to EUR 33.4 million after the first nine months of the business year, and that is exactly in line with what we expect with regards to our full year guidance range. The following slide highlights an important strategic step. We have initiated the process to conclude a control and profit transfer agreement with VIB Vermögen AG. This marks a key milestone in the ongoing integration of VIB into the Branicks Group. The goal is to establish a clearly structured, harmonized governance and decision-making framework that will enable us to capture synergies and further develop the group in an efficient and value-oriented way. Always in the best interest of our shareholders. Under the planned agreement, D IC Real Estate Investments KGaA will act as the controlling company, with VIB as the controlled entity. The agreement also provides for annual compensation payments to VIB's minority shareholders and includes the option for them to exchange their VIB shares for newly issued Branicks shares. We expect that VIB will convene an extraordinary general meeting in February to seek shareholder approval for the agreement. This would allow us to complete the structural integration in 2026 and continue executing our joint growth strategy with even greater efficiency and alignment. In view of our expectations for the current business year, we overall stick to our guidance except for real estate management fees. We expect gross rental income in the range from EUR 125 million-EUR 135 million, real estate management fees between EUR 45 million-EUR 55 million, and an FFO one after minorities and before taxes of EUR 40 million-EUR 55 million. With regards to acquisitions, we foresee no acquisitions for our on-balance sheet activities and EUR 100 million-EUR 200 million within our EBO segment. Our disposal guidance lays in the range of EUR 600 million-EUR 800 million, thereof EUR 500 million-EUR 600 million in our commercial portfolio and EUR 100 million-EUR 200 million in our institutional business. Beyond our guidance for the current year, our midterm ambition remains unchanged. We strive to transform Branicks Group towards a profitable ESG-focused and value-generating asset expert with sustainably strengthened cash flows and financial position. Our ambitions are clear, and we are working hard to achieve them. We want to substantially improve our earnings and cash flows and return to net profit in 2026. We have a clear midterm ambition to further reduce our debt, which will go along with improving the respective KPIs. Having said that, I would like to hand over to the moderator for your questions. Thank you very much, ladies and gentlemen. If you would like to ask a question, please press nine and star key on your telephone keypad. If you would like to withdraw your question, please press three and star. We are waiting for your question. The first question comes from Thomas Neuhold, Kepler. Mr. Neuhold, your line is open. Thanks a lot for the presentation and taking my questions. I have three questions. The first is on the accounting side. I saw that you had write-downs of EUR 178 million due to sales in the first nine months. Can you provide more details on these write-downs, please? Yes. We had sold two assets for the VIB or on the VIB level, so to say. As you know, as we have bought the VIB shares, we were on the peak of the transaction market and the values of the assets. When we sold the two assets in the third quarter, we had to take the depreciation of around about EUR 133 million of the two assets because it was one of the biggest assets VIB had, and the other one was a new development. Therefore, we had to take the depreciation as a so-called Sonder-AfA in Q3. Yeah, that's good. The second question is on your vacancy rate. I saw that was creeping up a little bit over the recent quarters. Can you elaborate a little bit on. Which assets are concerned and what are your measures to reduce the vacancy rates again? Hello, this is Dirk speaking. It's more or less kind of a mixture. We have a certain increase in the vacancy rate in the area of our logistics portfolio, but also in our remaining office portfolio. So it's kind of a mixture. The measures going forward, I mean, we have already signed rental contracts for certain areas, for certain square meters, but they're not yet effective. We will see this in 2026. We will see the reduction in vacancy rate because of the effectiveness of those rental agreements. Yeah, our teams are still working on all of our vacancies to enhance values. Thanks a lot [crosstalk]. My last question is more general on the investor market outlook. I was wondering if you can provide more color on how you see the situation currently, which asset classes are currently in demand, where it's still difficult, and what needs to change that we see a more active investor market going forward? Yeah. If you look on the transaction market numbers, it's real down also in 2025 compared to 2024, which was astonishing, so to say. If you look on our numbers, we are one of the most active transactors, so to say, in this market. Anyway, if you look on the market, you see that more foreign investors are coming to Germany and want to invest, especially in logistics. For all asset classes, I would say, in the development area, because. If you look on how the investors or who the investors are, these are mostly funds, big funds, foreign funds with a lot of money. They have in the pocket, so to say, but these are the special development areas, so refurbs and so on with a certain IRR. On the other hand, logistic, new development, redevelopment, and, yeah, existing portfolio. We also see more interest in the office area. Also interest in the retail area. At the end of the day, yeah, core plus is, I would say, only in the logistics area. Okay. Thanks a lot. Thank you. The next question comes from Jochen Schmitt from Metzler. Your line is open. Thank you very much. Good morning. I have two questions, please. The first one is also on the vacancy rate, especially regarding the office space in your portfolio. The vacancy rate increased by around two percentage points over the quarter. Could you provide some more reasons for that that made your contracts expire, for example? Second question, very briefly, any indication for the property valuation at year-end would be helpful. Thank you. Oh, okay. Yeah. Good morning. Sorry, I had a little problem with the fingers here. Yeah, we had, at the end of the day, the vacancy rates in office is we had big contracts, two big contracts, which, yeah, which ended, so to say. We have new tenants there, and therefore we have to refurb a little bit the areas to bring the new tenant in, and it will take us around about half a year until they are in. On the other hand, we have sold one or the other asset, which was completely full. The vacancy has, yeah, compared more percentage, so to say, in the total portfolio. Therefore, we have also an increase in the vacancy rate. The second question I have is the evaluation. We are in the middle of the evaluation, so to say. We have started them. We will have to finish that at the middle of December because there are a lot of assets. For the EBO segment, we have the evaluation during the year, so there are no surprises. I think, at the end of the day, we will stay roundabout at the same level as last year. For our commercial portfolio, we see also the first numbers, which are in the range of last year. What's coming up is now the evaluation of our developments. We have not seen that numbers. To sum it up, I think. Roundabout, I cannot say it very clearly, but we will stay roundabout on the level of last year. Thank you. The next question is from Manuel Martin, ODDO BHF. Please go ahead. Thank you for taking my questions. Two questions from my side, please. Follow-up question on the portfolio evaluation. I was wondering. I mean, if Branicks does a selling transaction and has to devaluate the property because it was in the book at peak valuation and now the prices are different, couldn't it be that there are more properties like this in the portfolio? That would be the first question. I think there are special assets we're talking about. At the end of the day, it's a big difference whether you look on the normal evaluation, so to say, or you go to the market and sell something. If you look on the cushion assets, which we have sold here, it was. Yeah, I do not know any other, but it has two levels as a logistics asset, so it is very special. It was built for one tenant, and it is an automotive tenant, so it is not really clear what is happening there. From our perspective, it is difficult if they want to reduce the space because to use the asset on the two levels for two different tenants will be very, very hard to say. We have sold it to somebody who is very keen on automotive and to the tenants. I think it was a good move here because at some time the contract ends, and therefore the decision was made on VIB to sell this asset. Therefore, there is a big amount what we have to take because it was. Yeah, a very high-level asset, so to say. Yeah. At the end of the day, as said, what we sell is specialties, yeah, to get it out because we think that others could do more on this or want to invest in the assets. As said, if you look on the next five-ten years on an evaluation basis with a discount cash flow method, it is another look on the asset than you look if you want to sell it today. If you want not to take the CapEx and TIs, which are in the evaluation included, you have to reduce the value, so to say. Therefore, you have the business at the end of the day induce these two values. The evaluation itself, yeah, we have taken the discounts on the last two years, when you remember. In total, I do not have the total number, but it was roundabout 15% or so what we had in the last two-three years. I think we have made the depreciation here. Therefore, I'm confident that we will not see big discounts this year. Okay. I understand. My second question would be also a bit following- up on the disposals. Could you elaborate a bit on or bring some color to the disposals? For example, what was the net cash inflow? Because I saw that you have EUR 97 million on your balance sheet as of end of H1. Is the net cash inflow there, or will it come, and how much will that be? Maybe you could give us some color on the 14 properties. I think it was not all logistics, but maybe a major part. That would be to bring a bit of color on that, please. Hello. This is Dirk speaking again. I mean, as you can see in the profit and loss statement and in the cash flow statement, we have net proceeds of the sales as of September 30th, 2025, of EUR 215 million. And then less a release. Amount that's roundabout. I would say. As an average, it's 50%. So it's more or less EUR 100-EUR 110 million was the net cash inflow here for the sales we did until September 30th, 2025. Does that answer your question, or? On the net cash inflow, yes. Yes. But when there was net cash inflow of EUR 110 million. And I see EUR 97 million on the balance sheet. Excuse me. So there must have been some cash outflow? Yeah. I mean, we had some. I mean, we paid back our debt, and therefore. That's the main reason why the cash flow or the cash reduced. Okay. The final aspect on the mix, was it rather logistics? Was it office? Was it FOIB? Was it commercial portfolio? Maybe color on that? Yeah. From the number of 14, we sold five office assets, and the rest was logistics. Okay. Thank you. Thank you. The next question comes from Philipp Kaiser, Warburg Research. Yeah. Hello. Thanks for the presentation and for taking my questions, a couple from my side. I would start with the FOIB topic. As far as I understood, so firstly, you consolidated all the entire entity business in FOIB, received the payment. With that, you redeemed the intercompany loan, and now you initiated a process of controlling profit transfer agreement. Could you shed some more light on the ratio behind, just from the operational perspective, also from your. Balance sheet financing perspective, what do you expect from this agreement, and what is the potential impact on, let's say, the financial KPIs? Yeah. So good morning. Yeah. I think the duration behind is that we do our step or our plan step by step, and the focus was on reducing the liabilities and keeping the LTV and the governance in line with our KPIs, so to say. The second step now is to integrate the VIB into the Branicks Group. You can imagine that this brings us to a clear structure and more governance, harmonization, and so on, so that we now made the decision that we want to start the negotiations about this with the VIB. What it brings is, yeah, we want to conclude a control and profit transfer agreement with VIB and therefore give the minorities shares from Branicks. We have to do a capital increase from Branicks' side. At the end of the day, we have, during this or after having this contract in place, one company. We can lift this, what you see in the balance sheet today, the consolidation of the business. I think that's easier for all of us, and it brings more clearness in the governance and in the decision-making steps. Okay. I think until now, you can't share more details on the ballpark of the compensation payment, the planned time schedule for capital increase, etc. Is that right? No. What we have started is we have started the talks with VIB. VIB on their side have to evaluate what's happening. Also, we have to evaluate. This means really evaluation. What's the evaluation on both sides? This is also, yeah, made by an evaluator. Beauftraged [Foriegn language] from the court, so to say. The court has done the decision who should be this. Now we are in preparing all the documents for this evaluator, and he needs some time. We do not exactly know how much time he needs, but we expect that we are ready beginning of next year. Therefore, we then will publish the invitation for the annual meeting on both sides. We expect it to be mid of February. Yeah, that's the process we have in line at the moment. At the end of the day, as said, it depends on the evaluator. We do not know the evaluator yet. We have had one meeting, and so we cannot really say, but that's the plan at the moment. Okay. Perfect. Thanks a lot. My next question with regards to your gross rental income and your unchanged guidance there. Could you kind of give me more insight on the last quarter? You printed already EUR 106.8 million in gross rental income. Taking the lower end, it would only be EUR 18.2 million in the last quarter. The upper end would be, yeah, below EUR 30 million. Is that purely driven by already concluded disposals as well as planned disposals? No, I think we will reach the upper end here if nothing special happens. At the end of the day, yeah, we are confident to reach the upper end, maybe a little bit more, but I'm not really sure here. At the end of the day, as said, when nothing special happens, we will reach the upper level there. Okay. Then kind of the gap between the first three quarters printing roughly between. 34-36 million is due to concluded sales, which then reduced the rental income. Are there any other impact on the top line? No, that's exactly right. Perfect. Thanks a lot. My next question with regards to the adjusted real estate management fee. I mean, the lower end is kind of just purely the recurring management fee as far as I would, yeah, see that. Do you have any or do you see any fee income from the transaction and performance fee side? Do you expect a pickup here in the market in the last quarter of the year?. Yeah. As normal, the last quarter of the year is always the busiest one. We expect this also this year. Yeah, to say it clearly, you are right. It's a little bit more than the recurring fees what we have here on the lower end. What we see is that the discussions and the transactions take much more time than before. You have to bring all the institutional investors on the page, so to say. You have to bring the tenants or the buyers on the same platform, and it takes a lot of time. We are not sure what we can realize on the decision-making side here until the end of the year and what will be postponed into the next year. Therefore, we have reduced the guidance here a little bit. We are also still following all our plans, but it takes a lot more time than in the past. Okay. Understood. Thanks a lot. The next one is on the OpEx side. You already elaborated that you have been able to bring down the OpEx overall by roughly 6%. After the first six months there were printed a reduction of 14%. What do you expect now for the entire year? What ballpark is possible to bring down the overall OpEx cost by the end of the year? Is it more double-digit, yeah, range or, yeah, high single-digit perspective compared to the last year? No, I would say high single digit. Yeah. Perfect. The last one from my side. With regards to the other adjustments, firstly, could you just quickly remind me what are the adjustments about? Following this explanation, ballpark, what do you expect for the overall adjustments on Branicks' level for the entire year would be very helpful. The other adjustments are mainly driven by our refinancing activities. These are kind of advisor costs in this respect. In the previous year, it was much higher. This year, it's just, I would say, the rest of the refinancing activities. Then we have some advisor costs in respect of intra-group transactions. That's basically the reason for those adjustments. In Q4, I mean, as of now, we expect something around another EUR ±1 million that will be adjusted for those advisor costs. Okay. EUR 1 million overall for the last qua rter. Is that correct? Yes [crosstalk]. Okay. Perfect. As you already mentioned, only the rest of the refinancing, mainly driven by the advisor too, is it fair to assume that this line will be, yeah, neglectable for the other coming years? At least in this double-digit million size? I mean, it's hard to say, to be honest. It depends on negotiations and other things. I mean, our overall goal is not having. Such big amounts of advisor costs in the future. I mean, we can't guide it as of today. Yeah. It's hard to say, to be honest. Understood. Thanks a lot. Very helpful. That was all from my side. Thank you. The next question comes from Marcus Schmitt, ODDO BHF. Yeah. Good morning. Thanks for taking the questions. I have just a couple. Firstly, on the cash situation. How much of net cash inflow will be received in Q4 or Q1 from concluded or notarized asset sales? Any figure there? To be honest, I cannot say this at the moment. We have to find it out and come back to you later. Yeah. Okay. On the profit and loss transfer agreement, I think on the consolidated level, this should not have much of an impact on the group LTV. Since the agreement is subject to a capital increase on Branicks' AG level, it will strengthen, apparently, the capital base of the individual entity. Was this a requirement from your banking partners, or was this not a key consideration here? No, we are not following any advices from the banks with this process. It was our decision and had nothing to do with any banks or something. Okay. There was also a fee mentioned subject to that new agreement. Can this be disclosed how much that would be? I do not really understand what you mean, a fee? Yeah. In the press release when this was announced, there was a fee mentioned you need to pay annually for that agreement. Yeah, yeah, yeah. Now I know. You mean the so-called guaranteed dividend? Yeah, yeah [crosstalk]. If you do such a process. You have to offer for the minorities who do not want to change the shares a so-called guaranteed dividend. It is what we find now out with the evaluator established by the court, how the right number will be then there. Okay. Finally, I mean, except for the integration of VIB, the key goal is, I think, to be able to transfer the cash earnings from VIB. I mean, just to understand the key objectives. I mean, these two would be the key objectives from my perspective. Yeah. Yeah. As I said, this has a lot of advantages. Yeah. At At the end of the day, we are consolidating the numbers. We see all these balance sheets and profit and loss. On the other hand, we have two companies which exist differently. It's much easier if you have what is in the balance sheet also in real life. Yeah. Also for the minorities as for us, so on the governance side, but yeah, also on the balance sheet side. Yeah. Therefore, we said we want to establish in real life what you see in the balance sheet at the moment. Yeah. Okay. Good. Yeah. Thank you very much. Thank you. As there are no further questions, I give the floor back to Jasmin Dentz. Thank you. This concludes our Q&A session in today's call. Thank you so much for joining us. Stay healthy, and let's talk again soon. Thank you. Bye-bye.