NuWays AG Maintains Buy Recommendation on DEMIRE AG

NuWays AG has updated its research on DEMIRE AG, maintaining a "Buy" recommendation with a revised target price of €0.80. DEMIRE's FY25 results, released recently, align broadly with expectations, showing continued focus on portfolio downsizing in a challenging market. Rental income declined by 18% year over year to €53.5 million and Funds From Operations (FFO I) fell 62% to €10.1 million, influenced by asset disposals and rising interest expenses.

The report highlights DEMIRE's success in selling 11 assets for €64 million, though this has resulted in a reduced rental base. Despite the rental decrease, leasing activity improved, showcasing DEMIRE's asset management advancements. Key challenges include increased vacancy rates and high financing costs, maintaining net leverage stable at 41.8%.

Looking to FY26, further declines in earnings are expected due to ongoing portfolio streamlining. The focus remains on disposals, refinancing, and managing vacancies, with operational gains becoming more visible.