Deutsche Grundstücksauktionen - Berlin rent cap coupled with coronavirus

Lower trade volumes resulted in Deutsche Grundstücksauktionen (DGA) reporting an almost 70% y-o-y decrease in net profit for FY19 (€0.5m). The decline is almost fully attributable to the parent company, which in H219 started to suffer from declining demand in anticipation of the Berlin rent cap, effective from February 2020. This was in part offset by the improved performance of the fully owned subsidiaries, which collectively doubled their income in FY19 due to real estate market development in up-and-coming cities. As a result of the coronavirus outbreak management decided to recommend a dividend pay-out ratio below 50%, resulting in dividend per share of €0.15 against €1.0 paid from FY18 income.