In an interview with Bloomberg, (94,5 CZK, 0,80%) Property Group’s CEO Jean Francois Ott has talked about the latest developments at the company. Mr Ott says he expects to sell Sky Office building by the end of 2011. He expects the firm to receive some € 40m-50m net from the sale. The CEO reiterated the revenue forecast of € 340m-370m for full-year 2011, which includes the sale of Sky Office and other asset disposals. Regarding the bond obligation which expires in mid-2012 and the € 300m loan that is due in the short term, Mr Ott said the company is in negotiations with some German banks about refinancing the loan. The CEO said they have currently renegotiated some € 225m-250m, thus there is still a gap to be covered. An agreement with the banks is expected in January. Mr Ott also stated is not considering selling any of its GSG portfolio assets as there are no plans to break up the portfolio. Regarding the German bond that expires next year, the CEO said some bondholders have agreed to swap bonds for shares but negotiations are still ongoing.
The CEO’s statements are in line with our expectations regarding the sale of the Sky Office building. We have incorporated the sale of Sky Office taking place this year and we forecast profit of € 20m. Our revenues forecasts are also some 15% below Mr Ott’s estimates: we are more conservative on the selling price for Sky Office and we expect lower rental and residential development revenues. Most of the information provided by the CEO had already been disclosed. The interview was released during yesterday’s trading session when Orco’s price increased some 10.5%.