Steady Core Performance in Q2 2023

Q2 2023 results

09 November 2023

  • Total revenues were BGN 4.3mln, down from BGN 17.9mln in Q2 2022. The decline is attributable to the base effects of an outsized gain in Q2 2022 revenue, during which the company sold their Bricolage Varna property for EUR 6.8mln and a land plot in Mladost district in Sofia for EUR 0.35mln.
  • After normalizing, revenue grew 3.7% from BGN 3.85mln to BGN 3.99mln YoY.
  • Operating expenses fell considerably (41.2%), primarily attributable to a 56.3% decrease in remuneration to the management company, but also by a 28.3% decrease in operational expenses of assets. Both decreases were predominantly driven by the disposal of the Bricolage Varna property.
  • In the past six months, total expenses decreased by 78.9% compared to the previous reporting period. Again, this was mainly due to the decrease in the value of sold assets with the sale of the Bricolage property. However, this decrease was partly offset by increased local taxes, charges and maintenance costs following the commissioning of the new building in the Sofia Tech Park.
  • Net profit was BGN 1.46mln, reflecting a 66.3% decline compared to the previous year. Again, this is mainly due to base effects. After normalizing, net profits instead grew by 9.3% from BGN 1.06mln.
  • Total assets grew YoY by 2.3%, while net debt decreased by 11.6%. The company reduced its long-term debt by 13.6%, or BGN 4.49mln.

Notable events:

  • On 07.06.2023, the company announced their 2022 dividend at BGN 0.1130022 per share for a total amount of BGN 3.9mln.
  • On 28.07.2023, BREF announced their signing of a rental agreement with private school “Canadian Bear” EOOD for the Kambani Green Office location. The rental agreement is for 10 years and the rented area is 1,889.25 sqm. The building reached 74.25% occupancy of its rentable area.
  • Additionally, they signed a rental agreement with Kalever EOOD for their Business Park location. The rental agreement is for 3 years and the rented area is 255.49 sqm. The building’s occupancy reached 71.05% of rentable area.
  • BREF announced they had managed to rent out the majority of commercial areas on the base floor of their Synergy Tower location in Sofia Tech Park, according to their reporting.
  • BREF signed an annex to the existing rental agreement with their main tenant Bosch at Synergy Tower. The maturity of the annex is the same as that of the main rental agreement, and the additionally leased area is 2,723.54 sqm.

Ivaylo Valchev
Equity Analyst
Tel.: +359 2 937 9862
e-mail: valchev@sis.bg

Svetozar Abrashev
Senior Managing Partner
Tel.: +359 2 937 9869
e-mail: abrashev@sis.bg

Sofia International Securities
Sofia 1000,
140 G. S. Rakovski Str.
Tel.: + 359 2 937 98 65
e-mail: info@sis.bg

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