IVG adopts selective sales strategy; in talks with creditor banks

German property company IVG Immobilien is to start selectively selling properties in a bid to increase its scope for action. The company is also in talks with its banks on extending some EUR 900 mln worth of credit lines which are due to expire in 2009, IVG said in a statement announcing its preliminary financial results for 2008.

'Currently, we are working hard to sustainably strengthen IVG and to make adjustments that will enable the company to cope with the challenges in the market.' Gerhard Niesslein, spokesman of IVG’s board of management, said. 'Our efforts are focused on safeguarding the company’s financing and on stabilising its operational income. Our most promising potential sources of earnings include the successful asset management of our properties and caverns, as well as the funds business. In addition, we will broaden our scope for action by selectively selling properties,' he said.

IVG said the talks with its creditor banks are 'proceeding in a constructive atmosphere' and will be concluded successfully soon.

According to preliminary, unaudited figures, IVG posted operational revenues of EUR 608.6 mln in 2008, up 14.3% from EUR 532.4 mln the year before.
However, against the background of the deteriorating crisis in the real estate markets in the fourth quarter of 2008, the company had to cope with considerable negative, non-cash market value changes, which amounted to EUR -944.4 mln, compared with EUR 154.1 mln the previous year. Overall, the company' s EBIT reversed from a profit of EUR 475.6 mln in 2007 to a loss of EUR 98.6 mln in 2008. Consolidated net profit decreased from EUR 301.0 mln in 2007 to EUR -451.7 mln in 2008.

The full details of IVG's 2008 performance will be presented at the annual press conference on 25 March 2009.