Q1 2025 LEG Immobilien SE Earnings Call
Ladies and gentlemen, welcome to the lack and will be there in Q1, 'twenty 'twenty five conference call and live webcast nine Valentino the chorus call operator.
I would like to remind you that all participants will be in listen only mode and the conference is being recorded.
The presentation will be followed by Q&A session. You can register for questions at any time by pressing star one on your telephone.
The rest is just the first thought is zero the conference must not be recorded for publication or broadcast.
Think Golfing: At this time, it's my pleasure to hand over it to think golfing, yet head of Investor Relations. Please go ahead.
Speaker Change: Thank you Valentina and good morning, everyone from the food off when it comes to our calling for our Q1 2025 results and thank you for your participation we have and they call. It as always our entire management team with our CEO Lars <unk>, our CFO Katherine cooling as well as our T O for Covid.
Speaker Change: You'll find the presentation document as well as the quarterly report and documents in the IR section of our homepage. Please note that there is also at this time, which you'll find on page three of our presentation and without further Ado I hand, it over to you with us.
Speaker Change: Thank you Frank and very good morning to all the shape, we are well on track for our guidance, which office, 7% bottom line growth cash generation from our core business continues to rise we grow in our core product. The integration of BCP is well on track this portfolio and the organic growth supported us.
Speaker Change: Strong net cold rent increase of more than 7% enabled us to further improve margins and boosted.
Speaker Change: By 28%.
Speaker Change: The strong level is partly affected by flattish investment level compared to Q1 2024. Therefore after the integration of BCP, we will increase investments so they start to go to India.
When you say rate our investment guidance for the full year of at least 35 euros per square meter.
Speaker Change: We reaffirm our guidance of an increase of the like for like rents in the range of <unk> to three 6% I E of more than 4% for all of our feet finance portfolio.
Speaker Change: The rent increase in Q1 amounts to three 5% because we execute rent increases as swiftly as possible. After the publication of new rent cable and therefore will depend on its publication.
Speaker Change: Our LTV increased slightly to 48, 4% because of a technical accounting effect first time full consolidation of BCP.
Speaker Change: Therefore, we stick to our existing safe program of around 3000 units, including assets at the low end of the quality spectrum as well as new built units. Additionally, we put the eastern German unit of BCP up for sale.
Speaker Change: Our disposal program to around 5000 units.
Speaker Change: Despite geopolitical tensions and macroeconomic grace transaction activity in the German residential market is robust and stable cash flows of the asset class and an expected value increase of <unk>, 5% to 1% in H, one and 2025 trucks continued interest from domestic and international.
Speaker Change: We therefore expect further progress on our disposal program.
As you can see on page seven BCP is operationally and financially fully integrated.
Speaker Change: After establishing the intended tax efficient structure, we executed the tender offer and the delisting from the Australian stock exchange, we successfully refinanced two third of Bcp's financings.
Speaker Change: This apparently isn't streamlining the legal structure.
Speaker Change: The first time consolidation of BCP supported our strong rental growth by around $12 million.
Speaker Change: People failure will be neutral to <unk> in 2025, and we will now ramp up investments into this specific process.
Speaker Change: And with this I hand, it over to <unk> with an update on our operations. Thank you loss.
Speaker Change: Now on slide nine with an update on our disposal program.
Speaker Change: After the disposal of roughly 2500 units in 2024 with corresponding disposal proceeds of 255 million euros. We sold another roughly 1500 units in Q1 with proceeds of 125 million euros.
Speaker Change: We strive to sell more and more efforts at least at book value to improve LTV.
Speaker Change: 5%.
Speaker Change: We are currently marketing around 5000 units.
Speaker Change: Units include the three thousands mentioned earlier in the year and Additionally, all of our system.
Speaker Change: Our assets in eastern Germany, most of those amongst the book.
Speaker Change: <unk>.
Speaker Change: Transaction market is robust and there is continued interest in general residential due to its low risk profile.
Speaker Change: On slide 10, you'll find more detail on our in place rent growth in Q1 of 3% or three 5% on our free Highland portfolio.
Speaker Change: Despite the comparably low slow start into the year, we confirm our guidance of an increase of three four to three 6%.
Speaker Change: For the full year or more than 4% for the free finance pumps.
Speaker Change: Executing rent increases.
Speaker Change: Im quite naturally as loss already pointed out somewhat dependent on the publication of those rents tables and this year quite a number of rent tables will be published in the following months.
The average in place rent per square meter now amounts to six euros 87 cents per square meter half the rent increase was attributable to rent increases and half to modernization and relaxing effects.
Speaker Change: The next cost rent adjustment on our rent restricted units, which make up 17% of our portfolio slightly lower number because of the BCP acquisition will take place next year.
Speaker Change: <unk> thousand 28, roughly half of all our rent restricted units will come off restriction and will provide us a meaningful rent increase potentially current difference between in place and market rents amounted to more than 50%.
Speaker Change: More detailed on that topic can be found on page 32 of the presentation in the appendix.
Speaker Change: On page 11.
Speaker Change: We provide more details on the split of Capex or maintenance investments.
Speaker Change: Adjusted investments per square meter in the first quarter reached seven euros 51.
Speaker Change: Corresponding to a minor decline of 0.9% while this development is lower than the run rate required to meet our guidance of at least 35 euros per square meter.
Speaker Change: Iterate our investment guidance.
Speaker Change: Just gained full control of the BCP portfolio at the beginning of the year. The increase of investment just took a few weeks, but we're already show up in our Q2 numbers.
Katherine: And with this I hand, it over to Katherine.
Katherine: Thank you <unk> and good morning to everyone also from my side I will start with slide 13, and the development of our operating Kpis and the first three months net.
Speaker Change: Net cold rent grew by seven 2% of $15 4 million to $229 5 million euros.
Speaker Change: This was driven by the integration of BCP, which contributed 12.
Speaker Change: 12 3 million Europe.
Speaker Change: Another $7 1 million Europe came from the 3% like for like growth of the spending portfolio, while disposal at an opposite effect 4 million euros. Our rent increase has indeed been passed on in full to the other earning position. The recurring net operating income showed an increase of eight.
Speaker Change: 7%, reaching 186 million euros.
Speaker Change: It's margin improved further by 110 bps to 81%.
Speaker Change: The adjusted EBITDA Rose by 10% to 173 4 million euros. The EBITDA margin improved by 200 basis points to 75, 6% well in line with our guidance of 76% for all of our financial year.
Speaker Change: 2025 a.
Speaker Change: <unk> increased by a strong 28, 2% to 62 3 million euros.
Speaker Change: Please turn to the next slide where we will have a closer look at the ASM or drive us below the EBITDA line.
Speaker Change: On the net cash interest we saw a moderate increase of two 8 million.
Speaker Change: Our maintenance Capex spending nearly flat year on year and somewhat behind the annual run rate.
Speaker Change: Though we plan to spread our investments evenly throughout the year, we must allow for short run a phase concerning the BCP portfolio.
Speaker Change: <unk> pointed out.
Subsidies there.
Speaker Change: Very low at 3 million euros in the first quarter as I already mentioned during our last earnings call. We expect an inflow of 20 to 25 million yards, all the way yet.
Speaker Change: Coming to slide 15, and Ntt's financial profile at the end of the first quarter.
Speaker Change: As youll see not too much changed on our profile and our Kpis.
Speaker Change: In Q1, we refinanced roughly two thirds of the more expensive BCP financing and secured one third of their financing which came at attractive yields.
Speaker Change: The outcome is an almost unchanged average interest cost at 155%.
Speaker Change: An average maturity of five six years for the group.
Speaker Change: So already including our 3 million Euro benchmark bond issuance in January 2025.
Speaker Change: We have our 2025 maturities addressed and we can still rely on the very strong liquidity position at the end of March we had around 830 million of cash and cash equivalents.
Speaker Change: Undrawn revolving credit facility, adding up to 750 million Europe, plus and our new commercial paper program of 600 million.
Speaker Change: You have certainly noticed that the LTV hasnt driven by 50 bps compared to year end 2024 to 48, 4%.
Speaker Change: Driven by the full consolidation of PCP into our numbers, we continue to stand by our midterm target of 45% and our ongoing and enhanced disposal program will further support this.
Speaker Change: As usual, we provide important financing kpis and bonds have a note in the appendix on slide 38, or ICR had slightly further improved to a strong four four times and all the other bond covenants.
Speaker Change: In dark Green territory.
Speaker Change: And I hand, it over to Laura for final remarks. Thank you Catherine we had a strong start into the year and are fully on track to deliver bottom line growth of 7% supported by DCP and further progress on our operational performance, we stick to our midterm target of 45% the expectation of a value increase.
Speaker Change: 0.5% to 1% and a continuation of our portfolio management exercise I E selling assets at the low end of our asset base at least at book value will contribute accordingly like.
Speaker Change: Like cash generation of operating our business remains strong interest costs remained low with a clean balance sheet. We are convinced to see as smoothly through periods of increased market volatility.
Speaker Change: Overall, we are happy to confirm each item of our guidance for this year with this I hand, it over back to Frank.
Valentina: And with this we begin the Q&A session and I hand, it over to you Valentina.
Speaker Change: We will now begin the question and answer session anyone who wishes to ask a question press star and one on the telephone.
Speaker Change: Here at home to confirm did you have entered the queue.
Speaker Change: If you wish to remove yourself from the question queue. You May Press Star then two.
Speaker Change: Question is on the phone are requested to paper the loudspeaker mode and eventually turn up the volume from the webcast as well asking a question anyone who has a question May press star one at this time.
Mario: The first question comes from Mario <unk> from <unk>. Please go ahead.
Mario: Good morning, Thank you for taking my questions. So two questions from my side Firstly.
Mario: <unk> East Germany.
Mario: And.
Mario: It's a bit of a background to deal with restructuring and this is one larger disposal or would this be split up into to multiple ones and then secondly could you maybe give us an update on the development land plots you acquired as part of the BCP deal.
Mario: Any policies that have been announced by the new coalition government, adding a bit more confidence Utah.
Mario: Bakken development. Thank you.
Mario: Good morning, Meredith and thanks for your questions with regards to the portfolio in eastern Germany. So it certainly wasn't sure LTV and additional acquisitions and are currently nothing which we are looking into and therefore, we do not think that we can scale up.
Quickly enough to really make this a sizable new.
Mario: <unk> office for us in Leipzig. So therefore, the decision we're growing that it makes sense to sell and dispose all other eastern German assets. This which we are currently marketing certainly and as always we are willing to bring that as a full percent yet, but we will maximize and allergen value for.
Mario: Our shareholders. So therefore, and we are also happy if we got back a bit on single parts of the portfolio to then and split it apart, but we are also willing to dispose it as a full eastern German portfolio with regards to the land plots. There are two land plots, which we have acquired and one is in <unk>.
Mario: Badge and the other one is in gas time, so apologies for the names, which I'll sit close to each other and the one in Garfield back and that is certainly something which is development to sell and average sales price per unit will be above 7000 euros per square meter.
Mario: Definitely not a product, which fits LNG. So therefore, we will sell the plot currently we do some and demolish men on the plots and as soon as this has been finalized which is most probably the case in Q3, we will then start to market that.
Mario: And bringing to the market.
Mario: And the second one and Thats the bigger one in gases we.
Mario: We are currently in talks with the city and there currently is not building permission that so therefore, we started negotiations with the city of <unk> and we currently look into whether there is a possibility for us to do the development ourselves, but if there is some.
Mario: One being very willing to buy from US. We would also look into an option of disposing and that unit. If you look at make reference to the parent coalition agreement and yes. There are some references being made to enable new building activity in the market.
Mario: Honestly due to the financial indications, we do not see any stronger push certainly there will be some reductions with regards to requirements like building type he will be implemented which might have a slight impact and reduces the cost per square meter to be beneficial.
Mario: We do not foresee any and substantial subsidies. So it is all about and the building permission, which you can agree with the city. We are in talks but it's still too early to finally say, whether we stick to that thought or whether we bring that to the market.
Mario: Alright, Thank you very much.
Mario: Thank you.
The next question comes from Thomas <unk> from Kepler.
Mario: Please go ahead.
Speaker Change: Good morning, Thanks, a lot for the presentation I'm thinking my question so it wasn't too.
Speaker Change: The first one is on your regulation guidance for streets and growth so.
Speaker Change: I was just wondering if there is no major change in interest rates going forward.
Speaker Change: Ctrip will happen to even further.
Speaker Change: Further expansion.
Speaker Change: <unk>.
Speaker Change: Or do you seek.
Speaker Change: Vince will stabilize.
Rental growth really feeds into innovation cadence.
Speaker Change: In the midterm.
Speaker Change: The second question is on PCP.
Speaker Change: I was wondering if you can for wireless is an uptake of the size and timing of potential synergies.
Speaker Change: Thank you.
Speaker Change: Yes, good morning, gentlemen, and thanks for your question so with regards to the revaluation and the guidance, which we've given to you I think and it holds true.
Speaker Change: Closed already with our numbers for HQ2024, So we've seen the turning point and we are now seeing a continuous and movement into positive territory as you might remember the guidance. We gave for <unk> through 2024 will zero to zero point.
Speaker Change: 5% and finally, we ended up with the airplane for now we are seeing that trend to continue and now we expect to your 0.51% for <unk> 2025, and that's a continuous positive momentum which is building up however for this year and our expectation is.
Speaker Change: That the rent growth will be strong.
Speaker Change: And then the growth of the nominal values. So therefore from our perspective, we are expecting a bit of a yield widening until the end.
Speaker Change: <unk> 25.
Speaker Change: Yes.
Speaker Change: Your second question was I'm, sorry, I forgot.
An update on the size and timing of potential synergies. This PCB okay.
Speaker Change: I think and that is what you can conclude from what we've done I think we had all hands on deck to really do a seamless integration of the BCP portfolio and.
Speaker Change: And I think we are quite proud of that.
Speaker Change: This.
Speaker Change: Difficult truck share of the company within Israel, enlisting many and legislations weathers NTT is that currently being dumped side, we are working hard and have done so over the last months to get that on the one hand side operationally integrated fully refi.
Speaker Change: But also with regards to full acquisition executed as quickly as possible. So that is I think quite substantial progress with regards to synergies as you know and we always promise that we are working on those and continuously will certainly make sure that those will get <unk>.
Speaker Change: <unk> did on within 2025 2026, but it will just take time yeah.
Speaker Change: As soon as we have done that and Tom as you will also see a positive contribution to <unk> and therefore, we stick to our current.
Speaker Change: That's meant that there will be a neutral impact on <unk> from the acquisition of BCP in 2025.
Speaker Change: Thanks, a lot.
Jonathan <unk>: The next question comes from Jonathan <unk> from Goldman Sachs. Please go ahead.
Jonathan <unk>: Good morning. Thank you for taking my question is on the like for like rent growth.
Jonathan <unk>: Could you elaborate how it's essentially you're going from 3.5% to 4% what are the key drivers of that with your FX and what you see going forward for the evolution of life like thank you.
Turner: And Turner from.
Jonathan <unk>: The key drivers of rent tables on the one hand.
Jonathan <unk>: Yes.
Jonathan <unk>: I remember couple.
Couple of rent tables adjust.
Jonathan <unk>: <unk> will be published in the next weeks. So we are for example.
Jonathan <unk>: Cologne moments that labor, which was published at the beginning of this quarter.
Jonathan <unk>: So we will now execute the on these.
Jonathan <unk>: That's the main driver in the second driver of course or re letting and close and we have some substantial organizations, which will kick in in Q4.
Jonathan <unk>: Okay Q4, okay and so.
Jonathan <unk>: What is the current sort of your own cost you expect from these modernization.
Please.
Jonathan <unk>: Yeah.
Jonathan <unk>: Okay.
Jonathan <unk>: Jonathan can you repeat I think we are still struggling to understand questions. Sorry, I was just asking what was the yield on costs you were achieving on these modernization that you're expecting to kick in in Q4. Please.
Jonathan <unk>: So it's still around that.
Jonathan <unk>: On cost of around 5%, Okay perfect. Thank you.
Jonathan <unk>: Thank you.
Speaker Change: The next question comes from that all Nic map staff from van lines with Camden. Please go ahead.
Speaker Change: Good morning, all and thank you for taking my question I was just wondering obviously the rent regulation framework has not extended by a few years, which means that rental growth will be kept for a few years have you seen the peers have started to focus also on businesses either in different geographies or different business lines still accelerate topline.
Speaker Change: Growth and you already mentioned that because of also your balance sheet is difficult to maybe grow externally. So wondering if you are exploring other options to also seek this acceleration in top line growth.
Speaker Change: Moment.
Speaker Change: Yes, it's a very niche we got see the rent growth and the rent regulation I think everyone. Everyone is being aware that we are currently has seen an extension of our rental break until 2028 and 2028 and.
Speaker Change: That's certainly something which we've always included in our forecast for this year 2025, we are we expecting a like for like rental growth and now a free funds portfolio of above 4%.
Speaker Change: We currently do not foresee any additional new boats coming to the market, which really make a difference to that and under supply, especially in the type of product, which we are currently offering.
Speaker Change: From our perspective, the shortage of affordable living in the German market will continue and therefore from our perspective, all so our net rental growth will be quite stable also for the years to come.
Speaker Change: Okay, but my question was more for instance, looking at the third party management or acceleration of development pipeline, just not something that youre looking into right now.
Speaker Change: Yes from our perspective are Nick and we are not looking into third party business. You know that we believe is into having a very clean easy to understand balance sheet. So we are not looking and envisioning any third party business from our end and certainly what we do.
Speaker Change: <unk> is try to maximize the value out of the assets, which we hold on our balance sheet and that I think you were able to see that and the net cold rent increases over the last year's increase substantially now we are envisaging and above 4% and 40 <unk>, it's part of our portfolio.
Speaker Change: What we consider to be and quite dynamic rent increase for the type of assets, which we are currently owning.
Speaker Change: Okay. That's clear thank you very much.
Manuel: The next question comes from Manuel <unk> from <unk> BHF. Please go ahead.
Speaker Change: Thank you.
Manuel: Engender.
Manuel: Two questions from my side. The first question is coming up on.
Manuel: The disposal of the eastern German properties.
Manuel: So I understand that well. This includes also Leipzig.
Manuel: Given that Leipzig, it's actually a city with a bright future maybe.
Manuel: Maybe you could give me some pros and cons on the decision of.
Manuel: So singles for an electric.
Manuel: Because in theory, it could be the possibility to buildup.
Manuel: Penetrating more portfolios and toxic.
Manuel: What would be the first question.
Manuel: I can only menu and very happy to once again and give you a bit more color on our decision to dispose of the eastern part of the portfolio. So if you look into the current portfolio. It's around 880 units, which we own in light sick and that is below the threshold.
Manuel: The 1000, which we normally set ourselves yes, slide six is a cat M City, which has developed and most probably will also in the future develop positively from our perspective. However, it is of incredible huge importance to have an ultra low cost and platform to manage our.
Manuel: Assets operationally Leipzig is unfortunately quite far apart from all the other assets, which we are managing certainly were willing to include highlight and mark to book, but that still quiet to driving distance SG&A. So therefore from our perspective, it was nothing which we should come close to the margins, which we are.
Manuel: Turning with adequate measures. So therefore that was driving our decision to dispose of Leipzig as well as of the other assets in the eastern markets.
Manuel: Okay understand thanks.
Speaker Change: Second and last question Kumar.
Manuel: Question on the P&L.
Manuel: There was an item other income which drove the operating earnings I think it was.
Manuel: Plus $129 million maybe.
Manuel: Maybe a short sentence on what's coming behind the other income in that case.
Catherine: Yes, that's accounting that's Catherine.
Manuel: Oh, sorry.
Manuel: Yeah.
Manuel: 99 is if they're lucky by our beds that we have from the temporary purchase price allocation, we will finalize it by the end of the year with our.
Manuel: Financially you have to guess for 2025, but this is what we currently have in the figures and according to <unk> you have to then put it.
Manuel: Through the so the profit and loss and Thats why its in other income.
Manuel: Of course, it can be.
Manuel: Yes.
Manuel: Alright, Thank you very much.
Speaker Change: The next question comes from Pardon me from Barclays. Please go ahead.
Manuel: Alright.
Manuel: Yeah.
Manuel: Yes.
Manuel: Our deployment.
Manuel: Transactions.
Manuel: Production expense synergies.
Manuel: Sure.
Manuel: Higher coupon.
Manuel: While our partner costs.
Manuel: Thanks, Jamie.
Manuel: Yes.
Manuel: Yeah.
Manuel: It didn't happen.
Manuel: Okay.
Manuel: Okay.
Manuel: Yes.
Manuel: Any vessel.
Speaker Change: Not really if you'd maybe if you can talk louder.
Manuel: If you take it off.
Manuel: Let's try that is there any person.
Manuel: Yes.
Manuel: So that's on the road at the moment.
Manuel: Just a couple of questions I think when you required BCP, you mentioned financial synergies or financial expense synergies.
Manuel: Thank you well recently.
Manuel: Cost of debt and I think you recently also provided intercompany loans to ACP.
Manuel: Coupons are they lower than your module costs. So just wanted another group level are you still comfortable that youll achieve financial expense synergies.
Manuel: Yes.
Manuel: Whatever we assumed in our business case that was Bang in line with what we were able to reach with his thoughts.
Manuel: The financial synergies being realized now that was also the reason why we pay it.
Manuel: <unk> whatever that was out there.
Manuel: They are being held by BCP for example, the shekel denominated funds and others and that was also the reason why we came out with that 300 million.
Manuel: In January and all of that said <unk>, partly being used to refinance.
Manuel: Yeah.
Manuel: Interest rate.
The PCP pumps.
Speaker Change: Okay, and then lower coupon news that you offered on a fixed rate to BCP.
Manuel: How does that sort of reconcile with your higher cost to <unk> I'm, just trying to understand that.
Speaker Change: Yes.
Speaker Change: Sure.
Speaker Change: Loan situation I think shouldnt be worried because wherever there is a 100% owned entity and therefore.
Speaker Change: That is something which metro.
Speaker Change: Shouldnt be of jewelry, we are financing the company on a group level and then we are handing down those loans into the different entities.
Speaker Change: Perfect and then second question on the rental growth in your stable markets maintained through 90 basis points higher than in your high growth markets and yet valuation yields and youll stable markets of 110 bps higher than in the high growth markets I just wondered how long do we considered the high growth to be high growth when the growth is not higher.
Speaker Change: In the stable markets and how does that support the lower yield in those high growth markets. If the growth is not as strong as elsewhere.
Speaker Change: So certainly it's a very good question and honestly Paul that is the impact of the rental break and I think a topic, which we've discussed on a very regular basis with you and many other investors in rental breaks certainly has an impact and that impact is being reflected in <unk>.
Speaker Change: Unfortunately lower growth in those markets is that the underlying market trend certainly not so with regards to Cologne distal drove in many other cities, where we have assets and market dynamics are certainly not properly reflected with those new lettings and that is part of the problem and that.
Speaker Change: This is to continue going forward, we are definitely of the opinion that there is not more new builds to come to the market is that just set me limit prospects tool.
Speaker Change: Project developers and those investors investing into new units because they are currently quite afraid that there is new regulations will also hit them.
Speaker Change: The aging U leaf and efforts.
Speaker Change: Market.
Speaker Change: Perfect makes sense I apologize for the background noise and poor reception.
Speaker Change: It very much.
Speaker Change: Thanks, a lot for your questions Paul.
Speaker Change: As a reminder, if you wish to register for a question. Please press star one on your telephone.
Michael: The next question comes from Michael <unk> from Bank of America. Please go ahead.
Speaker Change: Thank you very much very good morning all.
Speaker Change: Just wanted to come back on Europe.
Michael: Between the two.
Speaker Change: The Alt TV at 52% on your reported LTV at 48%.
Speaker Change:
Speaker Change: I understood.
Speaker Change: That was a tie.
Speaker Change: True.
Speaker Change: Allocating cash.
Speaker Change: Cash equivalent into receivables.
Speaker Change: Which is not.
Speaker Change: Consider it as cash effectively in the calculation of the <unk>.
Speaker Change: Okay.
Speaker Change: Everyone else by the way, including including Us.
Speaker Change: My question.
Speaker Change: Number one.
Speaker Change: Deposit cost deposit.
Speaker Change: It's been ratios from 600 million December 24th to frequent Q.
Speaker Change: Q1 dollars 25, and the gap between the two calculation Hasnt moved four percentage point y.
Speaker Change: Have you been able to investigate why.
Speaker Change: As the only company at least I know.
Speaker Change: Recognizing the proceeds cash equivalent into receivables and not in line are such great cash on cash equivalent. Thank you very much.
Speaker Change: With regard to the.
Speaker Change: Tremendously.
Speaker Change: Alright.
Speaker Change: You just have to take into consideration that the how.
Speaker Change: The Mezz how this measure is being taken.
Speaker Change: Hum.
Speaker Change: We count our cash cash equivalents according to Ifr S M I.
Speaker Change: I mean, I'm I'm really happy to invite you to discuss with us when we discuss with our with our auditor, but our auditor.
Speaker Change: Say that this is a cash and cash equivalents and short term deposits don't belong here and that's why we can't put them in here. So that's with regards to how we classify.
Speaker Change: Cash and cash equivalents.
Speaker Change: With regards to.
Speaker Change: The figure.
Speaker Change: It is different because a lot of things changed I mean.
Speaker Change: <unk> picked out one single thing.
Speaker Change: That you pointed out <unk>.
Speaker Change: Correct me that we've reduced the short term deposits, but also in Q1 changed a lot due to the PCP integration. So it's not just one single effect. We also have obviously a.
Speaker Change: And then.
Speaker Change: Hi.
Speaker Change: Higher debt position and we also had of course more assets too.
Speaker Change: BCP integration.
Speaker Change: I can just continue to iterate.
Speaker Change: We.
Speaker Change: Our focus and we still on our LTV, if you take the LTV of the of the upright.
Speaker Change: Correct. The short term deposits and you look how they account for four that's positioned quite well they just take nominal value, it's not financial account.
Accounting value so.
Speaker Change: I I ended up below 50% on that one but yes.
Speaker Change: Yeah.
Speaker Change: Happy to discuss this now every client with you.
Speaker Change: Well.
Speaker Change: I'm fine, but it's the only.
Speaker Change: My follow up question.
On your first point.
Speaker Change: Which is the ones I'm just rates actually I'm, just reflecting what the streets is asking me every single day on absolutely no clue.
Speaker Change: Why.
Speaker Change: <unk>, specifically, which are very famous one part of the big five if I'm correct.
Speaker Change: Recognizing something which is anywhere else not recognizing as receivable. So the question is what is so specific.
Speaker Change: What are the specifics specific to us on a short term deposit.
Speaker Change: Fuel accounts you're counting.
Speaker Change: Recognize it as I said it will not have the cash on cash secured on that does that.
Speaker Change: The only thing we're trying to understand is it because it's a quick turn product is it because it's in the SPV.
Speaker Change: You don't consolidate it correctly is it cash in the hand of your tenants from your comments because definitely from your tenants.
Speaker Change: Just wanted to understand what all the specifics of those three.
Speaker Change: $350 million.
Speaker Change: One.
Speaker Change: Really short term.
Speaker Change: This is not not no money from the tenants so not to confuse anyone and in terms of.
Speaker Change: The specific definition, let's just take it offline and we are happy to provide you with more information on that one.
Speaker Change: Thank you very much.
Sam coughing: Ladies and gentlemen that was the last question I would now like to turn the conference back over to Sam coughing or for any closing remarks.
Sam: Yes. Thanks.
Sam coughing: Dana and thanks for your questions and as always should you have further questions. Then please do not hesitate in contact US otherwise. Please note that our next scheduled reporting event is on the seventh of August.
Sam coughing: Report, our half year result, and with this we close the call and we wish you all the best and hope to see you soon on one of the upcoming Roadshows and conferences. Thank you and goodbye everybody.
Ladies and gentlemen, the conference is now over thank you for participating conference call and thank you for participating in the conference you May now disconnect your lines Goodbye.
Okay.
Sam coughing: Okay.
Sam coughing: [music].
Sam coughing: Yeah.
Sam coughing: [music].
Sam coughing: Yeah.
Sam coughing: Yeah.
Sam coughing: Yes.
Sam coughing: Yeah.
Sam coughing: Okay.
Sam coughing: Yes.
Sam coughing: [music].
Sam coughing: Okay.
Sam coughing: Yes.
Sam coughing: Okay.
Sam coughing: Yes.
Sam coughing: Okay.