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

A flying start to 2019 offers room for surprise as management’s guidance of an improvement in full-year PBT (€2.9m+) has already been secured in Q1 (€3.4m). The c €10m sale of a residential and commercial complex reiterated the success of RCM Beteiligungs’ asset development record and its focus on selected well-defined projects. Favourable macro factors and scope for efficiencies and asset appreciation support RCM’s positive outlook, evident in maintaining a dividend, raised by 50% last year. Solid finances (6x 2018 interest cover and an above industry-average equity ratio of 46%), boosted by Q1 disposal proceeds, allow significant reinvestment as well as further share buybacks (0.55m in May for €1m after 2018’s 0.7m capital reduction).

Share price graph
Price performance
%
1m
3m
12m
Actual 0.0 0.0 (4.5)
Relative* (1.1) (0.6) (2.8)
52-week high/low €2.3/€2.1
*% relative to local index
Key management
Reinhard Voss Vorstand