RCM Beteiligungs

DB: RCM

€30m market cap

€2.14 last close

RCM Beteiligungs is primarily a residential property developer focusing on the refurbishment of assets in the area of Dresden, Saxony. Additionally it invests in financial assets. RCM acquires low to medium value residential multi-family homes and modernises them. The objective is to achieve rent increases and an appreciation of the asset value. RCM realises value by selling the asset and re-investing in new real estate assets and opportunistic financial participations. While the real estate business accounted for 89% of revenues and represented 70% of the balance sheet total of €55m in 2016, the financial holdings and participation business represented 11% of revenues and tripled in value to €5.5m.

Investment summary

Having reported a bumper first quarter, RCM Beteiligungs has predictably met H118 expectations of €2.4m PBT, which alone exceeded full-year 2017 (€2.1m). Favourable macro factors and scope for efficiencies and asset development encourage continued confidence, even if this risks being tempered by a quiet Q2 (lower profit) and the lack of elaboration on post-Q1 guidance of €3m+ 2018 PBT. Sound finances (high interest cover and an above industry average equity ratio of 45% at June 2018) should allow a resumption in property expansion after a pause in 2017 and subsequent disposals.

Share price graph
Price performance
%
1m
3m
12m
Actual 0.0 (0.9) (2.7)
Relative* (7.6) (9.0) (1.6)
52-week high/low €2.3/€2.1
*% relative to local index
Key management
Reinhard Voss Vorstand