Luxury real estate prices continue to rise

Next capital increase at Tui should further reduce state aid

(dpa) The Tui Group wants to use fresh money from investors to further reduce the scope of its Corona state aid. According to information from Tuesday evening, up to 162.3 million additional shares are expected to be issued – the corresponding income would then flow into the “full repayment of the German state’s silent contribution 2”, as it was called in Hanover. Tui AG announced on Wednesday night that the new shares, each priced at EUR 2.62, generated gross proceeds of around EUR 425 million.

The state aid is a partial package worth 671 million euros that the federal economic stabilization fund made available when Tui came under considerable financial pressure in the pandemic due to collapsing business. With the implementation of the planned step, the company would have paid for a further tranche of the state support. The world’s largest tour operator also wants to reduce a credit line from KfW by another 336 million euros, which would then be a good 2.1 billion euros.

Tui had increased its capital several times in the past few months and also returned the first loan packages. CEO Fritz Joussen announced additional steps last week on the interim report for the winter half-year (October to March): “It will happen quickly.” At the beginning of April, the group had just reduced the funds provided by the federal government and private banks to combat the financial consequences of the corona virus by around 700 million euros from almost 4.3 billion euros.

In addition to the remaining EUR 2.1 billion KfW credit line, there would be a second silent participation (EUR 420 million) after the planned repayment, as well as the convertible bond issued some time ago, which the federal government can exchange for shares (EUR 59 million). . The newly planned shares should make up up to a tenth of the share capital – they are aimed exclusively at larger, institutional investors.

At the beginning of May, Tui – including the credit lines – had 3.8 billion euros in financial resources. The net debt was just over a month earlier at around 3.9 billion euros, they had recently fallen significantly. Joussen reported strong booking growth for the important summer of 2022, Tui is dependent on higher demand after two weak years with Corona travel slack.

Allianz Global Investors has to pay $6 billion

(Bloomberg) A fund subsidiary of Allianz SE has pleaded guilty to fraud in connection with the collapse of structured alpha hedge funds in the United States. The Munich insurance group has to pay more than 6 billion dollars in damages and fines. This was announced by the authorities in America.

Former Allianz Global Investors manager Gregoire Tournant will be charged with imploding hedge funds in New York, prosecutor Damian Williams announced Tuesday (May 17) in Manhattan. Allianz has already set aside €5.6 billion to settle investor lawsuits and regulatory investigations related to the hedge funds.

Hilti warns of cooling off in construction

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The Liechtenstein-based manufacturer of power tools, Hilti, felt the renewed strength of the Swiss franc in the first four months of this year. Sales increased by 6 percent to 2 billion Swiss francs, but growth was well below the 9 percent that resulted in local currencies.

Double-digit sales growth in local currencies is still expected for the year as a whole. According to the company, price increases in particular should contribute to this. At the same time, Hilti is preparing for a slowdown in activity on the global hardware stores, which are by far the largest customer for the company’s tools. The challenging market environment and the announced rate hikes make such a move more likely, the company says in their media release out of.

OC Oerlikon aims higher

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The industrial group OC Oerlikon intends to increase sales from CHF 2.6 billion to around CHF 3.5 billion within the next five years. According to the company, this requires annual growth of 4 to 6 percent. The two divisions Surface Solutions (surface technology and treatment as well as additive manufacturing) and Polymer Processing Solutions (plants for the production of polymer products and synthetic fibers) are to expand at the same pace.

At the same time, OC Oerlikon announced in the run-up to an investor conference that it would now be aiming for a return on sales of 17 to 19 percent at the operating cash flow (Ebitda) level in the medium term. Until now, the target was 16 to 18 percent. Last year, 16.9 percent was achieved.

Luxury real estate prices continue to rise, but probably not for much longer

tsf. The upward spiral in the Swiss luxury real estate market continues. As UBS writes in its study on luxury real estate published on Tuesday, properties in luxury locations in Switzerland were offered at around 10 percent higher prices last year than in the previous year. The increase was three times as high as the average for the last ten years. Compared to the market as a whole, real estate prices in the luxury segment rose around twice as much in 2021. As UBS writes in its “UBS Luxury Property Focus 2022” study, luxury real estate has become more expensive in all regions analyzed.

Above-average price increases were recorded in the top locations in Central Switzerland. In and around the major centers of Geneva and Zurich, prices rose by an average of around 10 and 12 percent, respectively. In the luxurious mountain destinations, the development was inconsistent. In the Upper Engadine, the strong price increases in the low double-digit percentage range continued for the second year in a row. According to the study, prices in Ticino only rose for condominiums, while they fell slightly for single-family houses. In the Valais Alps, prices developed below average in some cases.

The Upper Engadin has the highest prices for luxury real estate. As announced by UBS, more than 31,000 francs per square meter are paid for top properties. In the primary home markets in and around the cities of Geneva and Zurich as well as in Central Switzerland, the luxury segment starts at a level of just under 24,000 francs. Only in Ticino do luxurious properties change hands from around 19,000 francs per square meter.

“The considerable increases in assets due to a very good year on the stock market were largely responsible for the strong market development in the luxury segment,” explains UBS real estate economist Katharina Hofer in the press release. This higher demand met with a limited supply in the top locations.

UBS assumes that domestic demand for luxury real estate will experience a downturn in the current year. On the one hand, what has been a turbulent year on the stock markets so far will hardly permit asset increases of the same magnitude as in the previous year. Swiss economic growth – as an important driver of demand for luxury properties – is also likely to slow down in 2022 compared to the previous year. At the same time, demand from the euro area will be less strong due to the loss of purchasing power caused by the weaker euro against the Swiss franc.

Hearing aid company Sonova irons out the corona dent

tsf. The hearing system manufacturer Sonova has grown significantly after the corona pandemic. Sales for the 2021/22 financial year, which ended at the end of March, rose by 29 percent to CHF 3.36 billion, as the company announced on Tuesday. The strong increase is due to a solid market recovery after the Covid-19 pandemic. Acquisitions contributed 2.4 percent to growth. These are the expansion of the network of hearing aid stores, the acquisition of Alpaca Audiology in the USA and the takeover of Sennheiser’s headphone division.

Operating profit before acquisition-related depreciation (Ebitda) improved by around 40 percent to CHF 844.4 million. Due to the good cash flow development and the healthy balance sheet, the Board of Directors will propose a dividend of CHF 4.40 per share to the Annual General Meeting. This corresponds to an increase of 37.5 percent.

Sonova is confident that demand will continue to support the market upswing. For 2022/23, the group expects consolidated sales to increase by 17 to 21 percent and underlying EBITA growth to be in the range of 12 to 18 percent.

Economy in the euro area is growing somewhat faster than expected

(dpa) The economy in the euro zone grew somewhat faster than expected in the winter. In the first quarter, gross domestic product (GDP) rose by 0.3 percent compared to the previous quarter, according to a second estimate by the Eurostat statistics office in Luxembourg on Tuesday. In a first estimate, growth of only 0.2 percent was determined. Economists had expected an average confirmation. In the final quarter of 2021, growth was also 0.3 percent.

Compared to the corresponding period of the previous year, the economy of the 19 euro countries grew by 5.1 percent. Growth of 5.0 percent was initially recorded here.

However, the economic recovery continues to be modest. The Ukraine war dampens economic development. It leads to rising energy and raw material prices and to disruptions in supply chains. In addition, the tough corona policy in China is exacerbating supply chain problems and burdening the global economy. The service sector in the euro zone, on the other hand, is benefiting from the easing of the corona measures.

Clariant and Saudi Sabic let agreement expire

(Reuters) The voting rights agreement between the specialty chemicals group and the Saudi major shareholder Sabic expires at the end of the general meeting on June 24, 2022. Thereafter, the two parties no longer formed a group with regard to the attribution of voting rights and supervisory obligations. “We are confident that Sabic will continue to support us in the spirit of the collaboration that has been built up over the years,” said Günter von Au, Chairman of the Board of Directors. Clariant will report fourth quarter 2021 and full year 2021 results on May 19.

Real estate company Epic Suisse goes public on May 25th

(Reuters) The commercial real estate company Epic wants to go public on May 25th. The offer ranges from 67 to 77 francs per share. Including the over-allotment option, the company would have a market value of up to CHF 777 million. As part of the transaction, around CHF 200 million gross is to be collected from investors. Epic intends to pay a fixed dividend of CHF 3 per share for the 2022 financial year and is then aiming for a distribution of over 80 percent of funds from operations.