Hello and welcome to Peach Property Group AG H1 2026 Results Conference Call. There will be a question and answer session at the end of the presentation. Questions will be taken by phone only. I will now hand over to Gerald Klinck, Chief Executive Officer. Please go ahead.
Thank you, Vincent. Good morning, everybody. Welcome to our half year results call. We have in the agenda two topics. First of all, we want to give you a heads up on what we told you in our last call together with our chairman for the midterm guidance and where we stand right now. That is the first part. Afterwards I will have a look on some KPIs on the Peach at a glance in section two. The remaining pieces, and you know there is a lot of slides and information for you delivered here for housekeeping purposes. You can have a look inside the details afterwards. At the end we can do a Q&A, and hopefully you will have good questions and hopefully I have also better answers on that. But before we start, two comments.
As we all know, when I am talking about 2028, obviously these are forward-looking statements. The second comment is thank you for my team again, great job for the first half year operationally wise, and also my colleagues here in the holding staff to put all this together. Thank you very much for that. Starting with the presentation. On page five you see a lot of green bars here. That is our main challenges which we had in the first half year and what we achieved here. The green will present here where we stand right now. The blue one is still a little way to go, but overall green is here really, let us say the major color. It gives you a little bit of a feeling where we stand in achieving our goals for 2028. The first two things are on the operational side.
As you remember, one of our big targets is the top line growth. We expect over three years times for 2026- 2028 something in the ballpark of around 14% growth compared to 2025. Here is the bar for the 2026 targets or ambitions which we had here. On an annualized basis, we were almost done with our top line growth. We are good on track here, but for the second half of the year, we have to close a little bit here to achieve the 100% target here for 2026. But we are good on track here. Vacancy reduction also the same. We come a little bit later to specific numbers, but vacancy is reducing, let us say month- by- month. We are here on a very good track. Last time we talked about our portfolio sale which were notarized in December last year.
It is one part of our portfolio strategy which we execute here. The 2,000 units were an asset deal, which was not share deal. Share deal is even easier to close. Here it is asset by asset. It is almost done in terms of net cash which comes into our accounts. We are almost done. It is only one major location is not executed right now. That is due to some technical issues. I think we will do that or we have that here in the second half of the year. In terms of financing, as we all know, no maturities anymore to 2028. That is great. We repaid the convertible bond in the first half of the year. On that we achieved 100% target is met and that is good. On the remaining non-strategic disposals we are also good on track.
There is still a little bit to go. We have roughly 3,700 based on end of June, which is left to sell. After the half year, we were able to notarize almost 700 further units. So 3,000 units are still left to get rid of it in this year and also until end of next year. There is a little bit to go, but as you can see, 50% of the remaining pieces here are done. The Swiss functions totally moved from Switzerland to Cologne. That happened really on the last date of December last year. As you can assume, you have to recruit also some people here in Cologne and also in Berlin. In Berlin more or less the controlling team. In Cologne is the accounting team. To get them on board and to bring them into processes. This is totally done.
You see we delivered the half year results with the new team that is also in a good shape. We had an agreement with a minority shareholder and he is running roughly 20% or 20 SPVs as a rent blocker, which we have here in place. We were able to arrange here, let us say a shareholder agreement which is normal and common to have these in place to have a smooth together with him. We were able to find such kind of agreement. That is a little bit of housekeeping, but it is also necessary to get rid of some open issues here. This is also done. The repayment of the convertible bond I just mentioned and also the Swiss properties are also more or less sold. We are 100% notarized on our development on the Swiss lake. We call it the Peninsula.
That is the project name there, 100% notarized. Roughly 50% is change of ownership is done. The remaining part will occur in the second half of the year, latest in Q1 2027, so that is good. The remaining yielding assets, we found an agreement after the end of June, so it was in July. We are also in the process of handover and change of ownership here. The Swiss properties are more or less done. Legally wise, it is done. Technically wise, we are in the process to close that. On page six, and maybe you remember our four cornerstones to give you the heads up for the achievements or the ambitions for 2028. Here you see in these cornerstones and the challenges here, the highlights which we had here in 2026.
On the upper left-hand side, you see our net cold rent and the strategic portfolio increased by 3.2% on a euro per square meter. That is since the end of the year. So in six months, we were able to achieve here a 3.2% increase, which is in line and was our expectation. The like-for-like rent growth, so the comparison between June 2025 and June 2026, is in line also with our expectation of 5.1%. Remember, our ambitious is 6%, so there's a little bit way to go until the end of the year, but we are good on track there as well. Vacancy. It is also the comparison to the half year 2025. We came from 6.3% and were able in 12 months' time to bring that down by further 3%.
That is really an amazing achievement and the letting team here and also our property management made a very good progress on bringing down the vacancy, especially here in the strategic portfolio. NOI margin on the strategic portfolio improved to 75%. That is not the ambitious which we have for 2028. So there we are close to 80%. There's also still a little bit of a way to go, and this is what we want to achieve with further cost reduction and rent increase. That is also, I think on a good track. As I mentioned before, the non-strategic portfolio reduced to 3,000 units. The 3,000 units is really based on today's numbers, so not for the half year result because we have notarized a further 700 since the cutoff date here. Peninsula, I talked about. On the right-hand side on the financial, some KPIs.
Adjusted EBITDA is up by 25% and around EUR 30 million. FFO still stable. I think that is also good to mention. If you remember our guidance for 2026 is in the ballpark between EUR 17 million and EUR 19 million. If you make a simple approach here and annualize it, we are still on track here with the FFO. Compared to last year, we were able to stabilize that with a lower portfolio and a higher interest because now we see our interest is kicking in due to the new refinancings. If you make the comparison between 2025 and have there the advantage of the lower coupons on previous years, we were able to balance that out with the operational improvement. Of course, what I mentioned before, the improvement is expected here. Higher rents and lower vacancy.
This is a clear target here for our teams in the Peach Points. On the left hand side on the bottom LTV, and that is I think a very good signal here, dropped from almost 50% down to 45%. This is our target which we also want to achieve on a resilient basis 2028 onwards. So 45% is mainly coming from a slightly increase of our valuation. That is not a big impact here, but the major impact is coming from our debt repayments, and I come to that later. Next major debt maturity will be in 2028. I think people who knows us here or are with us over a long time, they know that we were able to find solutions for our refinancing. So the next maturity is still in 2028 to EUR 60 million.
You know we have the other bigger facility which is also maturing in that year, but we have there two years extension option. That is technically, legally wise we have that, but we are prepared to refinance also that facility in 2028 and hopefully we have better impacts on coupons in 2028. Portfolio valuation confirmed and increased by almost 1%, which is also good. That is a good underlying here for our CapEx measures. That means our CapEx is really bringing the values up in line with better rents and with lower vacancy. So our effect from valuation after CapEx is slightly EUR 4 million- EUR 5 million for the half year. So that gives us a good feeling that our CapEx is also in a good shape, and it is linked to value upside, and it is not on an accounting stuff CapEx.
But at the end, if we would not have, let us say, these positive impacts, it would be repairs and maintenance, as we all know. We can see here really that the CapEx is in a good shape and brings us to higher values. Where are the challenges, the key challenges for the remaining year here and for the next two years? The 6% like-for-like rental growth is our ambitious for this year, followed by roughly 3.5% to 4% the year for 2027 and onwards. As I mentioned before, we are at the moment annualized with 5.1%, so we are very close to our target here. We also want to reduce the vacancy further down to 2.8% by year-end. We talk about here the strategic portfolio. This is still our key challenge and further deleveraging our company. This is coming through our sales.
As we all know, our sales part, the non-strategic, the rationale behind that is not only get rid of assets which have a CapEx backlog, for example. It also brings us the liquidity which is needed for the CapEx spending for the next years for our strategic portfolio. The third impact is the deleveraging impact to bring the company on a resilient basis in 2028. On page seven, I think we put this slide in same like in the last presentation because I think it is a good overview. Where are our target vision? As I mentioned before, these are forward-looking statements, but we are stick to our strategy on around 16,000 units focusing or more less than North Rhine-Westphalia. Net cold rent above EUR 7.
Net cold rent growth on an ongoing basis coming from turnovers and normal increases on the ballpark of a little bit less than 4%. Vacancy below 3%. I think we are very close to these things. With that, we are very comparable to our competitors or our colleagues in the other listed sector that our strategic portfolio is really back on track and is comparable to others as well. LTV, as I mentioned, we achieved that target 45%. This is still our target for 2028 and onwards. Knowing that we are able to increase rents and bring down costs, our EBITDA will increase over the next years. Based on this debt which sits in the strategic, our EBITDA debt multiple is decreasing down to 12%. That is our clear target vision. NOI margin of a ballpark of 80%, also comparable to the sector.
EBITDA margin of 65%, that is a little bit behind our colleagues due to the impact of our, let's say, size of our assets here, of our portfolio. We are not able to achieve the same cost efficiencies maybe like others. There we are a little bit behind markets. FFO around EUR 30 million- EUR 32 million. How we come to that, I come a little bit later, but these are our clear target visions, and we do not change that. On the next page eight, gives you a little bit more background. If you compare these five with the last one, we want to show what are our ambitions and where we are right now and where are we tick the box and where are we going to achieve further improvement over the next time.
In terms of top line rent growth, I mentioned that I think now two times. This is, I think, good on track. On the operating cost effects, we were able to improve our rent collection processes. We achieved here 1.1% compared to 4.4% in 2025. That is a huge impact. To be fair, here is a one-off effect in which we do not count into FFO. That's roughly EUR 1 million. We want to be here fair. As you know, we have some of our one-offs for the restructuring and change of business model, which are, let's say, counted out of the FFO. Here we have the positive impact, and we also put that into the one-offs to be here very fair to you that we do not, let's say, manage our portfolio with accounting stuff here.
We are here really in line with what we also structured in the FFO bridge. The 1.1%, I think, is not a resilient thing, but we are on a very good track here, and my colleagues here in this department made a good job. On the other hand, the other cost down to NOI, we were able to reduce costs on repairs and maintenance and also in the other sections. There we are also good on track. If you count that together, you come up to EUR 5.4 million. We want to achieve overall EUR 6 million- EUR 7 million, so we are on a good track. Fairly to say that is on an annualized basis.
Maybe we have also some other impacts in the second half of the year, but given on an annualized basis of more than EUR 5 million compared to our ambitious of EUR 6 million- EUR 7 million, we are also here good on track. On the platform cost, I think I talked to the corporate function between Swiss and Cologne that it's achieved, and we are further on track with cost savings and efficiency gains in the IT accounting and tax systems. On the platform, we are working on our efficiencies, and we will see these impacts in our half-year results and also in further years as well. Last but not least, but this is something for 2028 onwards, that is the impact of our interest. We said that it's maybe a small dyssynergy because there are still some of our debt which is not on market conditions.
It is in a ballpark of EUR 100 million. There we will see some dyssynergies which will balance out on the others, where we have now the market coupons, which gives us hopefully a little bit more synergies in future times, like the other big facility which I mentioned before. That is starting in 2027. It is too early to start that process with financing partners right now. This is something for the 2027 targets and ambitious. On the next page nine, gives you a little bit of color in terms of columns. Our view here is what we also presented to you in the last version. We have here the half year 2026 in total, and we carved that out, the strategic portfolio, the impact on that. If you annualize it, then you come to the big bar, and then there is still a way to go.
The EUR 6 million from top line growth, the EUR 3 million from operating cost effects, the EUR 6 million for platform cost savings that we think that we can achieve the EUR 61 million EBITDA in future time, less the interest. Then you come down to the FFO, I would guess between EUR 30 million- EUR 32 million. Page 10 gives you the overview of our deleveraging highlights in H1. We were able to repay almost EUR 170 million. If you see on the left-hand side, so more or less EUR 1 billion. That includes the debt in our Swiss properties. So the development and also the yielding assets, there sit also debt behind these assets. So we were able to amortize on the secured ones. It is a EUR 6 million, so amortization is not really a big number in our facilities anymore.
The disposals mainly came from the 2,000 units, which we closed in the first half of the year, gave us roughly EUR 60 million debt repayments. Which is in the same ballpark like the convertible which we repaid. We used one tender offer and then at maturity, and then it was totally repaid in the first half year. Here you can see the impact on the financing of the Switzerland portfolio. I mentioned before that almost 50% of the apartments have a change of ownership. With that, we have to repay the construction cost debt side. That gives us another EUR 50 million. So three times 50 almost gives us here the new debt sitting in our accounts of EUR 850 million. Unfortunately, the average interest is a little bit increased.
That is due to the lower coupons in the Switzerland and in the convertible, and for that reason, our average cost rose slightly up to a little bit more than 4%. The EUR 124 million, which is linked to our non-strategics, will hopefully then also repaid if we are successful in selling these assets that we come to more or less EUR 700 million for the strategic portfolio in 2028. On the next page 11 gives you the debt structure or the maturity profile. What I mentioned before, the 2028 column is the first one.
It looks like a little wall, but given that we have the releases from sales, we dropped to EUR 370 million, and we are able to finance that in pieces and tranches that is given in the contracts so that we think the EUR 370 million is a good achievable size in the debt market here in the Pfandbrief lenders here in Germany. On the KPIs, I think everything is heading into the right direction. That is also good. You see on our interest strategy, 90% is almost fixed. We have 10% left for repaying our non-strategic releases. This is more or less in line that we also in line with our interest management strategy, in line with the portfolio strategy. Page 12 gives you then, let's say, a view on how the leverage will look like in 2028.
You see that we come from a debt multiple of 20x on EBITDA to 15.5x for the half year result, which is very good. Comes from the Swiss stat and from the other non-strategic assets, the 5x multiple and target is the 12 x. I think 12 x in these markets is a very good number. It gives us also a good feeling to be refinanceable in future times as well. Having said this, I jump to the slide where you see our Peach at a Glance. Maybe some comments to our numbers there. You will be familiar with these numbers because we present it every time when we come to you.
I think the major topic on the right-hand side is to mention that the non-strategics now, the actual rent, is reduced by almost 50%, coming from EUR 24 million last year down to EUR 12 million right now. This is the remaining pieces is to go. Actual rent, as I mentioned before, increased, and the vacancy dramatically dropped. On the left-hand side, on the financials, the valuation I think is good to mention. We come from 1,900 in the past and now with 1,800. This is also good. You see that the rent multiple is also decreasing, and that is due to a slight impact of valuation uplift, but the major impact of rent increase, so that we are here with a better yielding compared to end of the year. Unsecured debt, I think I mentioned that before.
We do not have unsecured debt anymore, and that is also a good movement on that. LTV is down, as I mentioned before. I think these numbers are a good evidence that we are on track. Last page 17. It is a split between the strategic and the non-strategic. I think the main highlight here is that obviously the portfolio share of the strategic is increasing. You see that in the green bar here from 74% at the end of the year is now 80%, and hopefully in one and a half years' time, we can see almost 100%. Vacancy also down, and if you see here the rings on the lower part, no surrender failure in our portfolio and the proportion of that is increasing.
On the right-hand side, as I mentioned before, based on the half year results, 3,700 units are left, 700 notarized, and we are here in the markets day by day. These numbers also decreasing over time. Before I kick off the Q&A, one last comment to our tender offer of the hybrid. Maybe you saw that in the last talk. We closed that processes last week. We offered them 20% of the nominal amount. Roughly CHF 10 million were in the tender offer. 50% were accepted from investors. We were able to save accrued interest by almost EUR 1.1 million, and for future times, EUR 500 interest per year, which we can save. As we all know, that is not part of our FFO. It protects our NTA per share.
That from our side was, I think, a good offer to give bondholders the opportunity to sell it back to us, and we were able to achieve that. Having said this, I come now to the Q&A section, and I hand back to the operator.
Ladies and gentlemen, we will now begin the question and answer session. As a reminder, we will be taking questions over the phone only. For you to be able to ask a question, just register through the phone. For you to ask a question, just press star, then the number one on your telephone keypad. Again, that will be star, then the number one on your telephone keypad. We will pause for just a moment to compile the Q&A roster. Again, to ask a question, you will need to press star, then the number one on your telephone keypad. I can see we have no questions at this time. I will turn the call back over to Gerald Klinck.
I think a lot of people are on the webcast and not on the phone line, so we do not receive here some questions. That is totally fine. If you have any other questions afterwards, please let us know. Mail us to our Investor Relations account, and then we come back to you with our answers. Thank you very much to join this call, and hope to see you soon again. Bye-bye.
This concludes today's conference call. Thank you for participating. You may now disconnect.