^Original-Research: Coreo AG - von GBC AGEinstufung von GBC AG zu Coreo AGUnternehmen: Coreo AGISIN: DE000A0B9VV6Anlass der Studie: Research NoteEmpfehlung: BUYKursziel: EUR 1.00Letzte Ratingänderung: Analyst: Cosmin Filker, Marcel GoldmannH1 2023: Large portfolio acquisitions to come in 2024; EBIT break-evenexpected in 2024; price target: EUR 1.00; rating: BUY In the first six months of 2023, Coreo AG was able to increase rentalincome to EUR 3.17 million (previous year: EUR 2.82 million). As there were noproperty additions in both the 2022 financial year and the current 2023financial year, the 12.7% increase in gross rental income was achieved onthe same property basis. Portfolio optimisations carried out, such as theproperty handover in Kiel in the past 2022 financial year or the conclusionof a long-term rental agreement with the city of Wetzlar, have increasedthe revenue base, from which Coreo AG benefited in the first half of 2023.In addition, vacancies were already reduced in the past financial year andrent increases were implemented in some cases. However, part of theincrease in gross rents is also due to the current market-related rise inancillary costs, which resulted in a significant increase in advanceoperating cost payments of 44.1% to EUR 0.84 million (previous year: EUR 0.59million). Total operating costs of EUR 3.10 million (previous year: EUR 3.04 million)remained roughly at the previous year's level. Within costs, the cost ofmaterials in particular increased to EUR 1.79 million (previous year: EUR 1.29million). This was partly due to higher ancillary operating costs andpartly due to maintenance and modernisation expenses, which relate inparticular to the properties in Wetzlar, Delmenhorst and Göttingen.However, the increase in the cost of materials was offset by a decrease inpersonnel expenses and other operating expenses (including lower legal andconsulting costs). At EUR -0.44 million (previous year: EUR -0.61 million),EBIT in the first six months of 2023 was therefore also higher than theprevious year's figure. We have prepared our forecasts on the basis of the current propertyportfolio. In addition, we also assume property acquisitions for the comingfinancial years, which will both have an impact on the company's rentalincome and, as part of the value-creating strategy, result in possiblevaluation income. In the first six months of 2023, Coreo AG generated gross rental income ofEUR 3.17 million. With the exception of the sale of the 119 residential unitsin the 'Hagenweg' property, the property portfolio is unchanged for thesecond half of 2023, meaning that comparable gross rental income is likelyto be generated in the second half of the year. The loss of rental incomefrom 'Hagenweg' of around EUR 0.20 million (GBC estimate) will be limited, asthis will not occur until the fourth quarter of 2023. Compared to ourprevious forecast (see forecast dated 14 July 2023), we are neverthelessadjusting the expected rental income slightly more to EUR 6.12 million(previously: EUR 6.53 million). This adjustment is primarily due to the delay in the purchase of theHagen/Rostock portfolio, for which the purchase price (total investmentvolume: EUR 2.5 million) has already been finalised. We had previouslyexpected to acquire the property in the second half of 2023. As thingsstand, however, the property will not be acquired until the comingfinancial year. In addition, the transfer of the Spree-Ost portfolio, forwhich a purchase agreement has been in place since 2021, is planned for thecoming 2024 financial year. This portfolio comprises 1,341 flats and 15commercial units and, as the largest acquisition in Coreo's history, wouldhave a significant impact on the company's revenue and earningsperformance. As a precautionary measure, we have postponed the acquisitiondate to the second half of 2024 (previously: first half of 2024) and aretherefore also reducing the expected rental income for 2024 to EUR 8.22million (previously: EUR 9.56 million). This effect is not relevant for the2025 financial year; the lower expected rental income of EUR 12.15 million(previously: EUR 12.36 million) expected in this financial year is solely aresult of the sale of 'Hagenweg'. The book loss of EUR 0.61 million from the sale of the properties on'Hagenweg' in Göttingen was recognised in full in the first half of 2023,meaning that no further negative effects are expected for the second halfof the year. In our previous forecasts, we did not anticipate any valuationlosses; on the contrary, we assumed valuation gains due to the investmentsin the existing portfolio. In the updated forecast, we have taken intoaccount both the book loss and conservatively assumed slightly lower bookgains on the existing portfolio. Accordingly, the company should report anegative EBIT of EUR -0.12 million in the current 2023 financial year(previously: EUR 2.18 million). With the expected strong increase in rentalincome, in particular due to the addition of the two already fixedportfolios, EBIT break-even should be achieved sustainably from the coming2024 financial year. As part of our DCF valuation model, we have determined a new price targetof EUR 1.00 (previously: EUR 1.30). The price target reduction is solely aconsequence of the forecast adjustment. We continue to assign a BUY rating. Die vollständige Analyse können Sie hier downloaden:http://www.more-ir.de/d/28337.pdfKontakt für RückfragenGBC AGHalderstrasse 2786150 Augsburg0821 / 241133 0research@gbc-ag.de++++++++++++++++Offenlegung möglicher Interessenskonflikte nach § 85 WpHG und Art. 20 MAR Beim oben analysierten Unternehmen ist folgender möglicher Interessenkonflikt gegeben: (5a,6a,11); Einen Katalog möglicher Interessenkonflikte finden Sie unter: http://www.gbc-ag.de/de/Offenlegung+++++++++++++++Date and time completion (german): 17.11.23 (07:55 am)Date and time first distribution (german): 17.11.23 (10:30 am)Date and time completion (english): 20.11.23 (08:02 am)Date and time first distribution (english): 20.11.23 (10:00 am)-------------------übermittelt durch die EQS Group AG.-------------------Für den Inhalt der Mitteilung bzw. Research ist alleine der Herausgeber bzw. Ersteller der Studie verantwortlich. Diese Meldung ist keine Anlageberatungoder Aufforderung zum Abschluss bestimmter Börsengeschäfte.°