German High Street Properties A/S
Financial report for the period January 1, to June 30, 2024
CVR-nr.: 30691644
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Company information
Company
Denmark
Company registration no.: 30691644
Financial year: 1 January – 31 December
Hometown municipality: Gentofte
Executive Management
Michael Hansen
Board of Directors
Hans Thygesen, Chairman of the Board
Jutta Steinert
Claude Olof Nikolaj Zethraeus
Auditor
PricewaterhouseCoopers
State Authorized Public Accountant Partnership Company
Strandvejen 44
DK-2900 Hellerup
Denmark
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Table of Contents
Company information ........................................................................................................................................ 2
Group Structure ................................................................................................................................................. 4
Company presentation ....................................................................................................................................... 5
Management Report .......................................................................................................................................... 5
Strategy .............................................................................................................................................................. 6
Financial calendar 2024 ................................................................................................................................... 25
Company Announcements ............................................................................................................................... 26
Management's Statement ................................................................................................................................. 28
Income Statement ............................................................................................................................................ 30
Other comprehensive income .......................................................................................................................... 31
Balance Sheet .................................................................................................................................................. 32
Statement of Equity (Group) ........................................................................................................................... 33
Statement of Cash Flow ................................................................................................................................... 34
Notes ................................................................................................................................................................ 36
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Group Structure
As of June 30, 2024, the group consisted of seven German GmbHs and three holding companies in Germany.
German High Street Properties A/S
GHSP Zweite Holding ApS & Co.KG.
GHSP Grundbesitz I GmbH
(Pforzheim)
GHSP Grundbesitz III GmbH
(Aachen)
GHSP Erste Holding GmbH
GHSP Grundbesitz V GmbH
(Braunschweig)
Apreit Two Grundbesitz GmbH
Braunschweig
Frankfurt
Hamburg
Kassel
Koblenz
Rosenheim
GHSP Dritte Holding GmbH
GHSP Grundbesitz IV GmbH
(Essen, Leverkusen)
GHSP Grundbesitz VI GmbH
(Essen)
GHSP Grundbesitz VII GmbH
(Gütersloh)
Minority share-
holders
100%
100%
94%
94%
89
,
6%
10,4%
6%
6%
5
Company presentation
German High Street Properties A/S aims to invest in well-located properties in cities with economic and de-
mographic growth in Scandinavia, Germany, Switzerland, and England. The group's current property portfo-
lio includes 13 German high street properties in 11 cities. The group was established in 2007 and was listed
on Nasdaq Copenhagen on September 20, 2007. The group is managed by the Administrationsselskabet
Gambit ApS. STRABAG Property and Facility Services GmbH in Stuttgart handles the property manage-
ment in Germany in collaboration with the group's three employees.
Management Report
Germany is the world's third-largest economy and has served as Europe's economic engine for decades. The
German economy is seeing slight improvement, with GDP in Germany growing by 0.2% in the first quarter
of 2024. Inflation and interest rate hikes hit Germany relatively hard, but it now seems that Germany is be-
ginning to regain some footing. With an increase in German business confidence, inflation under control, and
a slowdown in interest rate hikes, there is hope that the economy will pick up some momentum again.
The high inflation and numerous interest rate hikes caused the German economy to stagnate more or less
throughout 2023 – and even decline in several quarters. Now, inflation appears to be more under control,
with core inflation below 3% for the first time in two years, and interest rate hikes have slowed down. Addi-
tionally, business confidence has been mostly upward in 2024, indicating an improving economy, while ex-
pectations for the future of the German economy have improved for the tenth consecutive month and are cur-
rently at their highest level since February 2022.
Expectations for the future are at their highest in more than two years. This follows the growth of the Ger-
man economy in the first quarter of the year after having been more or less stagnant for over a year. The pos-
itive story, therefore, is that the German economy is slowly on the road to recovery, with particular progress
in the service sectors.
As of June 30, 2024, the group has 13 German properties.
For the period from January 1st to June 30st, 2024, the result before value adjustments and taxes amounted
to a profit of T.EUR 49.0 in total, and after value adjustments and taxes, a loss of T.EUR -1,436.0 in total for
the period. The result is as expected.
In view of a lower interest rate level, a positive result before value adjustments and taxes is expected to be at
the lower end of the announced range of EUR 0.0 – 0.3 million in 2024.
Development of Rental Income
As a result of the renovation and maintenance work that has been initiated, rental income from January 1 to
June 30, 2024, has generally increased compared to the same period in 2023, as previously vacant units have
been rented out. This trend is expected to continue for the rest of 2024. However, the geopolitical situation
may still negatively impact the business foundation.
6
Development of the Property Portfolio's Value.
As part of the accounting process, as in previous years, the management has assessed the value of the Ger-
man portfolio. The German market for rental properties in 2024 was characterized by a slightly higher yield
requirement from investors and a slowdown in the interest in purchasing properties. Based on this, the board
of directors and management have assessed that the value of the German portfolio is EUR 89.5 million
which is EUR 1.5 million lower than the board of directors' and management's assessment as of December
31, 2023.
According to the management's assessment, the above valuation corresponds to the fair value as of June 30,
2024.
Stock Price
German High Street Properties A/S is listed on Nasdaq OMX Copenhagen. The stock was offered at a price
of DKK 100 on September 20, 2007. The stock price for German High Street Properties A/S on June 30,
2024, was DKK 105 (EUR 14.09) and on December 31, 2023, DKK 103 (EUR 13.82)
Investments and Dividends
Re-letting the remaining vacant premises generally requires renovation work to be carried out to some ex-
tent, and expenses for maintenance in 2024 are expected to be higher than in 2023 for the German properties.
There will be a significant investment need for a couple of properties in connection with tenant turnover. It
remains essential for the Group to have a liquidity reserve considering the need for additional maintenance,
renovation, and re-letting of several of the group's leases.
Strategy
Business Model
German High Street Properties A/S invested initially in rental properties in major German cities. The proper-
ties, primarily with shops on the ground floor and offices or residential units on the other floors, were ac-
quired in 2007-2008. The property portfolio after that consists of 13 German properties.
German High Street Properties A/S is managed by Administrationsselskabet Gambit ApS, which, along with
the Board, focuses on:
Optimizing ongoing operations through rent increases and reducing vacancies.
- Long-term value creation.
- Retaining current tenants.
- Renting out unleased premises.
- Continuously optimizing the company's financing.
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- Acquiring properties that generate attractive cash flow.
- Optimizing the Group's other costs.
German High Street Properties A/S is a socially beneficial business that helps to ensure shops, offices, and
homes for ordinary businesses and people in the larger German cities and other markets where German High
Street Properties A/S may establish itself. German High Street Properties A/S aims to contribute to improv-
ing urban renewal in these cities. The development and renovation of the properties help to ensure employ-
ment in the construction industry.
Operational Strategy
German High Street Properties A/S develops and maintains its property portfolio to optimize the properties'
operations. The properties are continually maintained to preserve their current standard. Additional work,
such as investment in redecoration, is undertaken when necessary to attract new tenants or retain a significant
tenant in a property.
The management continually assesses whether the operation and use of the properties can be optimized by
converting vacant office spaces into retail spaces, where the rent per square meter is usually significantly
higher, or into residential units, where demand is usually higher and long-term more stable.
The Group’s goal is to increase cash flow by:
- Focusing on long-term value creation
- Retaining current tenants
- Renting out unleased premises
- Continuously optimizing the Group’s financing
- Acquiring properties that create an attractive cash flow
- Continuously optimizing the Group’s costs
Investment Strategy
The board ensures that the Group's capital structure supports the company's strategy and long-term value cre-
ation.
German High Street Properties A/S's investment strategy is to acquire and own retail properties located in
attractive locations on main shopping streets, in central pedestrian environments, or in strong retail and com-
mercial areas. The purchased properties must also be in areas with strong economic and positive demo-
graphic development. The possibility of acquiring or selling individual properties is continuously considered.
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Key figures (Group)
Group
EUR 1.000
Jan-June
2024
Jan-June
2023
Q2 2024 Q2 2023 FY 2023
Revenue 2,606 2,182 1,348 986 4,535
Result before fair value adjust-
ments and interests
959 770 480 381 1,599
Fair value adjustment of invest-
ment properties
-1,604 0 -1,604 0 -5,111
Financial expenses, net
-910 -592 -454 -304 -1,332
Result of continuing activities
before tax
-1,555 178 -1,578 77 -4,844
Result of continuing activities af-
ter tax
-1,088 148 -1,124 43 -3,993
Result of discontinued activities
after tax
-348 0 0 0 492
Result for the period
-1,436 148 -1,124 43 -3,501
EUR 1.000
30 June
2024
30 June
2023
31 December
2023
Investment properties
89,500
96,000 91,000
The Balance sheet total
96,343
105,138 102,121
Total equity
56,273
61,358 57,709
Total non-current liabilities 37,688 41,182 38,915
Solidity (in %)
58.4% 58.4% 56.5%
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Grosskölnstrasse 20-28, Aachen
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INCOME STATEMENT
Revenue
The revenue for the period from January 1 to June 30, 2024, was EUR 2.6 million compared to EUR 2.2 mil-
lion in the same period from January 1 to June 30, 2023.
Of the increase of EUR 424.0 thousand, EUR 269.0 thousand relates to an extraordinary rental income re-
ceived in the second quarter of 2024.
Result Before Value Adjustments
The gross profit from January 1 to June 30, 2024, amounted to EUR 1,656.0 thousand after operating costs
of EUR 950.0 thousand, compared to a similar gross profit of EUR 1,480.0 thousand after operating costs of
EUR 702.0 thousand in 2023.
The result from January 1 to June 30, 2024, before value adjustments and financial items, was EUR 959.0
thousand, compared to EUR 770.0 thousand in the same period from January 1 to June 2023, 2023
Result Before Financial Items
The result from January 1 to June 30, 2024, before financial items, was a loss of EUR -646.0 thousand after a
net value adjustment on the property portfolio of EUR -1.6 million.
In the same period in 2023, the result before financial items was a profit of EUR 770.0 thousand after a zero-
value adjustment on the property portfolio.
Result of Continuing Operations Before Tax
The result from January 1 to June 30, 2024, before tax, amounted to a loss of EUR -1,555.0 thousand after
financial items of net EUR -910.0 thousand.
The result from January 1 to June 30, 2023, before tax, amounted to a profit of EUR 178.0 thousand after
financial items of net EUR -592.0 thousand.
Result of Continuing Operations After Tax
The result after tax from January 1 to June 30, 2024, is loss of EUR -1,088.0 thousand compared to a profit
of EUR 148.0 thousand in 2023 for the same period.
Given the current economic conditions, interest rate developments, and market conditions in Germany, the
management considers the result after tax as expected.
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BALANCE SHEET
Assets
The management assessed the value of investment in German properties at EUR 89.5 million as of June 30,
2024, compared to EUR 91.0 million as of December 31, 2023, according to stock exchange announcements
no. 261 of August 14, 2024.
As of June 30, 2024, total assets amounted to EUR 96.3 million, compared to EUR 105.1 million in the same
period from January 1 to June 30, 2023.
Equity and Liabilities
As of June 30, 2024, equity was EUR 56.3 million, corresponding to a solvency ratio of 58.4%. As of De-
cember 31, 2023, equity was EUR 57.7 million, corresponding to a solvency ratio of 56.5%. Equity de-
creased in the period from January 1 to June 30, 2024, due to the loss for period of T.EUR -1,436.0.
Financial debt obligations as of June 30, 2024, were EUR 34.0 million (EUR 37.6 million December 31,
2023). Of this, EUR 0.6 million matures during the period from July 1 to December 31, 2024.
Besides the agreed quarterly instalment of the loans of T.EUR 326.5 the financial debt obligations were re-
duced by EUR 3.0 million from January 1 to June 30, 2024, due to the disposal of the property Hesselvang
11, Grenaa.
CASH FLOWS
The year's cash flows from operating activities after interest and taxes paid, from January 1 to June 30, 2024,
amounted to T.EUR 565.0, compared to T.EUR 51.0 in the same period in 2023.
Cash flows from investing activities from January 1 to June 30, 2024, were EUR 4.6 million, relating to the
disposal of the property Hesselvang 11, Grenaa.
Cash flows from financing activities net for the period from January 1 to June 30, 2024, were EUR -3.6 mil-
lion, related to repayments of the group's financial debt obligations.
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SUBSEQUENT EVENTS
According to stock exchange announcement no. 262 of August 19, 2024, the Company's Board of Directors
has decided to cancel the attempt to offer the property Schillerstrasse 4, Frankfurt am Main, as a project sale
through Kartago Capital A/S. Besides the company intends to initiate in Q3 of 2024 a capital raise of up to
approx. EUR 8.0 million with pre-emptive subscription rights for existing shareholders.
No other events have occurred after the balance sheet date that significantly impact the assessment of the fi-
nancial report January 1, to June 30, 2024.
Expectations for 2024
The management still expects a minor slowdown in 2024 for specific industries. Lower interest expenses
combined with rent levels and vacancy levels at the same level as at the end of 2023 will mean that the
Group’s result for 2024 before value adjustments and tax is expected to be in the range of 0.0 - 0.3 million
according to stock exchange announcement 249 of December 29, 2023. The expectation is given with a res-
ervation for a higher interest rate than expected, just as the general geopolitical situation may negatively af-
fect the result.
The anchor lessee, Appelrath Cüpper GmbH, in the property in Aachen has terminated the lease with effect
from January 31, 2023, but the lessee, despite numerous requests, has not vacated the lease. Appelrath Cüp-
per GmbH continues to pay rent and requires payment for decor and shop fittings in connection with moving
out. The company's lawyer has rejected the claim and has issued a writ of summons against Appelrrath Cüp-
per GmbH.
Management expects that re-letting levels will continue to be under a minor pressure and that investments in
improving several leases will be required in connection with re-letting and tenant change.
Accounting Reporting Process
To ensure high quality in the group's financial reporting, management has adopted several procedures and
guidelines for accounting and internal controls, which must be followed by the subsidiaries in their reporting,
including:
Quarterly follow-up on achieved goals and results at the group level.
- Prepared estimates for income statements, balance sheets, cash flows, and key figures at the group
level.
- Ongoing follow-up on projects, including handling of risks and accounting treatment thereof.
- Accounting closing instructions.
- Reporting instructions.
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Statement on Environmental and Climate Conditions
Environmental and Climate Impact in Accordance with the Annual Accounts Act § 99a
In connection with property renovations, German High Street Properties A/S has established an environmen-
tal and climate policy to comply with all applicable building regulations and reduce energy and resource con-
sumption where it is economically advantageous.
We assess that our property portfolio, which consists of retail, residential, and office properties, does not
pose specific climate and environmental risks. The properties are not located in coastal areas or near rivers
and are not leased for purposes considered environmentally harmful or hazardous. They are mainly located in
urban areas and have constructions that are not considered sensitive to climate change in the medium term.
When major repairs or improvements are made to the properties, more climate-friendly and contemporary
materials are generally used, including windows with energy glass, better-insulated roofs, LED lighting, and
more efficient heating systems (typically district heating).
Extra insulation is typically added when roofs are replaced, and when heating sources are replaced, there is
usually a switch to district heating and the integration of new energy-efficient pumps and valves. The prop-
erty managers and caretakers will be instructed to focus on continuously saving energy and optimizing en-
ergy use. The company tries to limit its travel activity where possible.
In the daily operation and use of buildings, CO2 is emitted. The properties of German High Street Properties
A/S are no exception, and this emission and the consequences of ongoing renovation and maintenance of the
properties are among the most significant environmental risks. There is also a risk that waste from demoli-
tions may contain hazardous substances. In some of the construction processes of German High Street Prop-
erties A/S, there may be environmentally harmful impacts from machinery and/or materials.
German High Street Properties A/S expects that recycling and new technologies will support the opportunity
to reduce CO2 emissions.
Description of the Business Model:
Core Activities:
German High Street Properties A/S aims to invest in well-located properties in cities with economic and de-
mographic growth in Scandinavia, Germany, Switzerland, and England. The properties, primarily with shops
on the ground floor and offices or residential units on the other floors, were acquired in 2007-2008.
Value Proposition:
The value proposition of German High Street Properties A/S is to offer shareholders a long-term investment
opportunity in attractively located rental properties.
Customers:
Our primary customer segments include both small stock investors and institutional stock investors. Our sec-
ondary customer segments include retail chains that are tenants in our properties and ordinary renters. We
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work closely with our customers to understand their unique needs and tailor our products and services to
meet those needs.
Revenue Streams:
Our revenue streams are generated through rental income from retail chains that are tenants in our properties
and from ordinary renters.
Key Partners:
Through our German property management company and German real estate agents, we collaborate to ex-
pand our reach and enhance our offerings. These partnerships are crucial for driving innovation and provid-
ing better offers to our customers.
Cost Structure:
Our primary costs are related to the operation, maintenance, and improvements of our properties. We focus
on cost efficiency and scalability to ensure a sustainable business model.
Human Rights
German High Street Properties A/S operates solely in Denmark and Germany, both of which have ratified the
UN's human rights convention. The company respects each individual and does not accept that employees,
tenants, or other external parties are subjected to discrimination. The company views diversity as a strength
that creates a positive workplace. The diversity here refers to variety in terms of gender, age, religion, ethnic
origin, sexuality, education, professional experience, opinions, interests, and much more. The company oper-
ates only in economically and politically stable countries and complies with all applicable regulations, in-
cluding labor rights, agreements, etc. The company does not enter into agreements with companies or indi-
viduals who do not respect human rights.
The company's most significant risks concerning respect for human rights are related to discrimination and
lack of diversity.
The goal is to prevent any form of human rights violations. There were no cases of human rights violations
from January 1 to June 30, 2024.
During staff replacements, all qualified individuals are encouraged to apply for the positions regardless of
gender, age, religion, etc. Management continuously ensures that the policy guidelines are followed. The
company will continue its anti-discrimination efforts in 2024.
15
Social Conditions and Employee Relations
German High Street Properties A/S employs only a few staff, as almost all tasks are outsourced to subcon-
tractors and partners. Therefore, German High Street Properties A/S has not developed an actual policy for
the area. Likewise, no special risks were assessed.
Anti-Corruption
German High Street Properties A/S has a policy against corruption. The property and company administra-
tors or their partners may not receive unusual gifts from suppliers or give gifts beyond minor occasional
gifts.
There is a risk that subcontractors could engage in corruption/bribery of, for example, authorities by paying
them “out of their own pocket.” Additionally, there is a risk that local property administrators in Germany
could receive money from subcontractors in the form of kickbacks. In tenders, there is also a risk of cartel
formation. In the ongoing controlling of local property administrators in Germany by the manager, there is a
focus on ensuring that German High Street Properties A/S only pays bills after normal vouchers with docu-
mented expenses and that prices are benchmarked against usual costs. No corruption was detected from Jan-
uary 1 to June 30, 2024, during the control and review of contracts.
German High Street Properties A/S will focus on ensuring that all suppliers and employees contribute to anti-
corruption in the coming years.
Statement on Management Issues
Good Corporate Governance
The board of German High Street Properties A/S considers safeguarding the company's—and thereby the
shareholders'—long-term interests its most important task. The guidelines for the company's overall manage-
ment are described in its statutes, objectives, and strategy. They are based on values that stem from generally
recognized principles of good corporate governance.
The board and the executive team have the overarching responsibility for the company's risk management
and internal controls in relation to financial reporting, including compliance with relevant legislation and
other regulations concerning financial reporting. The company has established risk management and internal
control systems to ensure that the internal and external financial reporting is accurate and free from signifi-
cant misinformation. The executive team has established a reporting process that includes budget and peri-
odic reporting, including explanations for variances and periodic updates of the year's estimates. In addition
to the comprehensive income statement, balance sheet, and liquidity forecast, the reporting also includes sup-
plementary information.
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Corporate Governance Code
The Committee on Corporate Governance published the Recommendations for Good Corporate Governance
on December 2, 2020, based on the "comply or explain" principle. Nasdaq Copenhagen has implemented the
recommendations in the "Rules for issuers of shares." The recommendations can be requested from the Com-
mittee on Corporate Governance's website, www.corporategovernance.dk.
The board of German High Street Properties A/S annually assesses the company's rules, policies, and prac-
tices in relation to the Committee on Corporate Governance's recommendations. The board is of the opinion
that the company substantially follows the recommendations, although it assesses that company-specific cir-
cumstances make it impractical or irrelevant to fully follow certain recommendations.
For a mandatory statement of the reasons for this, refer to the company's website, according to
https://www.germanhighstreet.com/corporate-governance.
The company currently does not follow and does not expect to follow any corporate governance codes other
than the ones mentioned above in the foreseeable future.
Evaluation of the board and executive management
The Group’s board conducted a board evaluation in 2023. All board members participated in the evaluation.
The main conclusions of the board evaluation were that there was consensus among the board members
about the group's strategic priorities and that the board possesses the relevant competencies in relation to the
group's activities and strategic focus areas. The conclusions from the board evaluation will be used as a basis
for future searches for relevant board candidates.
Remuneration Policy
The Group’s board is compensated with a fixed honorarium and does not receive incentive-based remunera-
tion.
The base honorarium for the board is set at a market-conforming level that reflects the demands on board
members.
Effective January 1, 2024, the board remuneration amounts to an annual basic honorarium per member of
EUR 30.3 thousand. The chairman receives the basic honorarium three times.
The board determines the salary and employment conditions for the executive management at least once a
year based on a recommendation from the chairperson. The director is not part of any incentive scheme. Mi-
chael Hansen received EUR 120,000 in 2024.
The employment contract for Michael Hansen follows the notice period of the Employee's Act. In addition,
no board and executive management members are entitled to compensation upon termination of employ-
ment.
17
The company believes that the remuneration of the board and executive management supports the company's
strategy and is in accordance with its interests, good practices, and recommendations for good corporate gov-
ernance.
Diversity Policy
The company's board is compensated with a fixed honorarium and does not receive incentive-based remuner-
ation.
Purpose
This diversity policy aims to outline the framework and principles for the group's view on and inclusion of
diversity in the group's business operations and management.
Policy
The group considers diversity an essential factor and opportunity that can improve the group's competitive-
ness in both the short and long term. The group is against any form of discrimination and aims to treat appli-
cants and employees equally, regardless of differences in, among others:
Gender, age, sexuality, ethnic origin, disability, and life situation
Attitudes and opinions, religion, interests, ambitions, life philosophy, personal causes
The group expects that respect for these differences will also apply to employee relations.
Efforts and Results
The group informs all new employees about the company's policy and ensures that no discrimination has
taken place in the appointment of positions in daily management. In 2023, the group's management was not
aware of or informed about any cases of discrimination, either in the appointment of management positions
or generally in connection with the company's activities.
Statement on Social Conditions
Objectives and Policies for the Underrepresented Gender in Accordance with the Annual Accounts Act
§ 99b
In the parent company, the board has set a goal to have at least 25% female members in 2024. June 30, 2024,
the board comprised 33% female members. The board's objective is to ensure a diverse management compo-
sition and equal opportunities for both genders. The target for the proportion of female board members was
set at 25% in 2017, and by the end June 2024, the company met this target. The board's composition is car-
ried out so the company can develop steadily and satisfactorily, considering general and specific legal re-
quirements and recommendations for good corporate governance. Furthermore, as board members are re-
placed, the board will work towards rejuvenating the ages of board members.
18
The board will assess the status of meeting the objectives at least once a year and, as far as possible, nomi-
nate suitable female candidates for the board at upcoming general meetings to maintain the goal.
Gender diversity:
Target
2024
2023
2022
Board of Directors:
Total number:
4.0
4.0
4.0
Underrepresented gender (in %)
33.0
25.0
25.0
Target (in %)
25.0
25.0
25.0
Target
2024
2023
2022
Exective management:
Total number:
1.0
1.0 1.0
Underrepresented gender (in %)
0.0
0.0
0.0
Target (in %)
0.0
0.0
0.0
German High Street Properties A/S had fewer than 50 employees from January 1 to June 30, 2024, and is not
obligated to establish and report on a policy for increasing the underrepresented gender in other management
layers. The company's Board of Directors currently consists of 4 members and the company’s Executive
Management consists of 1 member.
Data Ethics
German High Street Properties A/S group does not have a formalized policy for data ethics. The group only
processes data for business purposes. German High Street Properties A/S group does not use new technolo-
gies such as artificial intelligence, advanced algorithms, surveillance, etc. Data processed in the German
High Street Properties A/S group is not available to third parties. If there were to be a desire to make data
available to third parties, it would have to be approved by the company's top management.
German High Street Properties A/S group complies with applicable legislation regarding the processing of
personal data. The group generally does not process sensitive personal data, except for employee data.
19
Special Risks
IT Security
With the increased use of digitalization in business, digital threats and risks also increase. German High
Street Properties A/S continuously discusses the development of risks and threats. We follow the develop-
ments and ensure we are as well-prepared as possible to handle the current threat landscape.
Risk Management
The group is exposed to several risks, some of which are beyond the group's control, while others can be in-
fluenced or managed as part of the daily operations. Significant risks beyond the group's control include gen-
eral economic development, pandemics, geopolitical unrest, natural disasters, energy supply, and demand for
retail and office rentals in the cities and areas where the group's properties are located, changing trade pat-
terns, legislation, and access to financing. Changes in general economic conditions can lead to falls or in-
creases in property values, increased vacancies, falling rental incomes, and slower tenant payments. The
group cannot change these fundamental conditions but can seek to organize rental and investment activities
to minimize the adverse effects of economic cycles.
Other Risks
Active risk management is part of the group's strategy to optimize earning opportunities. The group seeks as
far as possible to address and manage risks that its actions can influence. The property market is sensitive to
economic cycles, which is reflected in periodic significant property price fluctuations.
The overarching framework for the group's risk management is continuously assessed by the board and man-
agement based on, among other things, reporting from the group's partners in property management.
Below are the risks considered to potentially negatively impact the group’s future growth, activities, financial
position, and results. This description is not exhaustive and does not prioritize the listed risk factors.
Operational Risks
The operation of the property portfolio can be affected by changes in realized rental income and costs for op-
eration and maintenance.
Management manages risks based on ongoing reporting and only entering administration agreements with
recognized partners.
20
Rental Income
Investing in real estate is associated with a leasing risk. The leasing risk mainly concerns the development of
the rent level and the development of vacancy rents. Such deviations can particularly be due to factors re-
lated to a tenant's ability to pay rent, the group's ability to adjust the rent, general and specific demand and
supply development in local markets, development in vacancy rates, and the development of market rent lev-
els for German and Danish properties.
The group's management and administrator closely monitor rent developments through periodic and system-
atic reporting. This is to focus on leasing vacant premises, managing the duration of new contracts, avoiding
concentration of expiration dates, ensuring stability, and minimizing the vacancy rate as much as possible.
In the short term, it cannot be ruled out that some tenants may demand a rent reduction due to external
events. Expected court decisions regarding previous operating years may affect the result if the set-aside
amount is insufficient.
Costs of Operation and Maintenance
Management assesses that the planned expenses for operation and maintenance are sufficient to maintain the
current rental income and the current technical condition of the property portfolio. However, there is a risk
that actual expenses may be higher than expected. External factors can also affect actual maintenance costs,
including weather conditions, technical conditions, regulatory requirements, commercial decisions, develop-
ment in general price levels, and lack of capacity in the market for labor and materials.
The environmental impact of operating the portfolio is attempted to be reduced through minimizing energy
consumption where economically justifiable and where it can lead to a reduction in operating costs. On the
other hand, changes in regulatory requirements for environmental conditions can increase operating costs.
Credit Risk
The group does not have a particular concentration of credit risks. Credit risks relate to tenant receivables
and other short-term assets, including liquid holdings. Risk management takes place at the group level in ac-
cordance with management guidelines.
The guidelines include credit approval of new tenants and ongoing monitoring of receivables. Reporting to
management is done monthly.
Impairment is made based on an individual assessment of receivables from leasing to the extent that the
group expects to be unable to recover the arrears.
Risk Regarding Property Administration
The group's ability to efficiently manage the portfolio will affect the development of rental income and its
planned optimization.
21
Effective July 1, 2023, a new administration agreement has been entered into with STRABAG Property and
Facility Services GmbH to manage the property administration of the German properties. STRABAG Prop-
erty and Facility Services GmbH is a medium-sized property administrator in Germany with broad geo-
graphic coverage.
Market Risks
The portfolio's value depends on its commercial operation and income and the development and pricing of
investment properties in Germany - specifically, German high-street properties. The general pricing of high
street properties is influenced by several factors, among which are current inflation and expectations for fu-
ture inflation, current interest rate levels and expectations for future interest rates, future property investors'
demands for net yield for similar properties, the extent of new construction of various property types, de-
mand for premises, general and local population development, general economic development, particularly
economic growth, employment development, development in German private consumption, development in
retail stores' turnover and earnings, and changes in the public sector's activity level and demand for premises.
Currency Risk
The group owns only properties in Germany and a newly constructed property in Denmark. Therefore, both
the group's assets and ongoing income are in EUR. To reduce currency risk, the group has also financed the
German properties in EUR. Management assesses the currency risk of investing in EUR as limited relative to
DKK.
Interest Rate Risk
The company has financed itself with the following loan:
Loan tranche 1 is a 10-year loan initially amounting to EUR 46,0 million with a variable interest rate, with a
current interest rate as of June 30, 2024, including the interest margin, of approximately 5.3% p.a. (as of June
30, 2023, the interest rate including the interest margin was approximately 4.9% p.a.)
The nominal remaining debt on the loan is EUR 34.0 million as of June 30, 2024 (as of June 30, 2023, it was
EUR 36.3 million).
A change of 1.0 percentage point in the general interest rate level would result in a change in the group's an-
nual interest expense before tax of 340 T.EUR.
The company repays EUR 1.3 million annually on the loan.
As a result of its operations, investments, and financing, the group is exposed to changes in interest rates.
The board closely follows developments in the financial markets.
22
Refinancing and Liquidity Risks
As an important part of risk management, the management closely monitors the group's liquidity reserve,
which is intended to ensure that the group's current and future obligations, including payment of interest and
principal to lenders, can be serviced. The group's loans relating to German properties have been entered into
with non-renegotiating clauses from the lenders' side until 2027, as long as the DSCR (annual Net-Kaltmiete
*0.75/annual payments under the loan) are higher than 1.05.
As of June 30, 2024, the DSCR has been calculated to be 1.01 in average. The borrower has secured a de-
posit of EUR 1.5 million until January 2025 with the lender to waive this DSCR clause.
The calculation of the DSCR is expected to improve in the event of a potential decrease in interest rates, debt
reduction or re-letting.
Political Risks Regarding Danish and German Tax and Duty Legislation
The group is subject to the prevailing laws regarding taxes and duties, and no assurance can be given that tax
and/or duty legislation changes will not occur - including changes in the double taxation agreement between
Denmark and Germany. Significant changes in law or practice regarding taxes and duties could affect the
group's financial position and results.
German companies that have no other activities than renting out real estate are, as a starting point, exempt
from paying German trade tax of 15-19%. As the rules regarding local German trade tax are complex, full
assurance cannot be obtained that the conditions for exemption from local German trade tax will always be
met. Suppose the German tax authorities challenge the conditions for exemption. In that case, this will lead
to additional unbudgeted tax payments, partly because the deduction right for interest on long-term debt un-
der the German rules on trade tax is limited to 50%. In collaboration with German tax advisors, the manage-
ment assesses that it will be possible to avoid German trade tax.
Board of Directors and Management
Board and Executive Management
The management of German High Street Properties A/S consists of a board of 3 members and an executive
management with one member who handles the daily operations. The board was elected at the annual general
meeting on April 30, 2024.
Administrator
The company's administrator is Administrationsselskabet Gambit ApS (Administrationsselskabet Kartago
ApS), which performs the company's administrative tasks in relation to investors, general meetings, lenders,
23
the stock exchange, public authorities, advisors, registries, etc. As payment for Administrationsselskabet
Gambit ApS’s services under the administration agreement, the company pays a quarterly honorarium of
0.18% of the properties' book value. The company's executive management also receives an annual remuner-
ation of EUR 120,000.
The company has a financial manager who handles the company's liquidity management, accounting, finan-
cial reporting, budgeting, cost control, etc. In addition, the company in Germany has an Asset Manager who
handles the optimization of operations for the German properties and development tasks, optimization, and
outreach work in connection with the re-letting of commercial leases.
Share Information
German High Street Properties A/S, following the decision at the general meeting on November 30, 2023,
reduced its share capital to a nominal DKK 30,453,830 divided into 3,045,383 shares by canceling 100,000
of its own shares. The shares are distributed among approximately 170 shareholders.
Following the consolidation of A-shares and B-shares in 2018, the company has only one class of shares. All
its shares are listed on Nasdaq Copenhagen under the short name GERHSP and ISIN code DK0060093524.
Change of Control
Loan agreements and other agreements are not changed due to a change of control.
Dividend Policy
It is the company's policy to pay dividends in accordance with the rules of the Companies Act and consider
the maintenance of an appropriate liquidity reserve. Dividend payments must also be made responsibly, con-
sidering the group's financial position.
The company's solvency ratio is 58.4% as of June 30, 2024, with liquid holdings of EUR 4.0 million.
Interim Financial Statements
German High Street Properties A/S publishes half-year and interim reports for the 1st and 3rd quarters.
24
Ownership and Related Parties
According to the Companies Act § 55, the following shareholders have reported owning more than 5% of the
share capital at the end of the accounting period:
Municipality
Sharecapital
Kartago Property ApS Gentofte 39.87%
Olav W. Hansen A/S Horsens 16.05%
Sparekassen Danmark Hjørring 15.33%
Kartago ApS Gentofte 11.99%
OTK Holding Hjørring 6.24%
The group is controlled by Alexander and Kristoffer Thygesen through Drot ApS and Marsk ApS, which to-
gether are the controlling shareholders in Kartago Property ApS and Kartago ApS, owning respectively
39.87% and 11.99% of the share capital, totaling 51.86% of the share capital in German High Street Proper-
ties A/S.
The group's related parties also include the parent company's board of directors and executive management,
as well as these persons' close family. Related parties also include companies where the aforementioned
group of persons has control or significant influence.
In addition to the above-mentioned shareholdings controlled by Alexander and Kristoffer Thygesen, the
board of directors, executive management, and companies where this group has a controlling influence hold
a total of 200 shares.
Investor Relations
Stock exchange announcements, annual reports, etc., are published on the company’s website:
https://www.germanhighstreet.com/
25
Financial calendar 2024
March 19, 2024
Deadline for submission of proposals for voting at the company's annual general meet-
ing
April 8, 2024 Annual Report 2023
April 8, 2024 Expected date for convening the annual general meeting.
April 30, 2024 Holding of the annual general meeting/or notification of the general meeting.
May 31, 2024 Interim report for the period January 1 to June 30, 2024.
August 20, 2024 Half-year report for the period January 1 to June 30, 2024
November 29, 2024 Interim report for the period January 1 to September 30, 2024.
26
Company Announcements
August 31, 2023 First half-year report 2023
October 31, 2023 Notice of extraordinary general meeting November 30, 2023
November 1, 2023 Value adjustment of properties
November 30, 2023 Minutes of the extraordinary general meeting November 2023
November 30, 2023 Third quarter interim report 2023
December 1, 2023 Major Shareholder Notification
December 4, 2023 Financial calendar 2024
December 29, 2023 Profit expectation 2024
December 29, 2023 Sale of property, Hesselvang 11, Grenaa
February 1, 2024 Planned sale of the property Schillerstrasse 4 Frankfurt am Main
February 29, 2024 Value adjustment of properties
March 27, 2024 Results 2023
March 27, 2024 Financial calendar 2024
April 8, 2024 Results 2023, update
April 8, 2024 Notice of Ordinary General Meeting
April 30, 2024 Proceedings of the ordinary general meeting
May 28, 2024 Major Shareholder Announcements
May 31, 2024 Interim Report for the period January 1 – March 31, 2024
August 7, 2024 Financial calendar 2024
August 14, 2024 Value adjustment of properties
August 19, 2024
Publication of preliminary half year result – Timing of half year report – Intention to
initiate capital raise
August 19, 2024 Financial calendar 2024
27
The property Braunschweig Münzstrasse
28
Charlottenlund, August 20, 2024
Executive Management
Board of Directors
29
Property Koblenz
30
Income Statement
Group
EUR 1.000 Note
Jan-June
2024
Jan-June
2023
Q2 2024 Q2 2023 FY 2023
Revenue
Property operation expenses
-950 -702 -493 -300 -1,564
Operating income
Staff expenses
4
-217 -257 -100 -117 -528
Administrative expenses
-480 -453 -275 -188 -844
Result before fair value adjustments and
interests
Fair value adjustment of investment proper-
ties
6
-1,604 0 -1,604 0 -5,111
Result before interests and tax
-645 770 -1,124 381 -3,512
Financial income
Financial expenses
-966 -648 -485 -342 -1,470
Result of continuing activities before tax
-1,555 178 -1,578 77 -4,844
Tax of continuing activities
Result of continuing activities after tax
-1,088 148 -1,124 43 -3,993
Result of discontinued activities after tax
5
-348 0 0 0 492
Result for the period
-1,436 148 -1,124 43 -3,501
The Parent Company’s shareholders
-1,431 144 -1,118 43 -3,471
Non-controlling interests
-5 4 -6 0 -30
Result for the period
-1,436 148 -1,124 43 -3,501
Earnings per share (EUR), continuing activ-
ity
7
-0.36 0.05 -0.37 0.01 -1.31
Earnings per share (EUR), discontinuing ac-
tivity
7
-0.11 0.00 0.00 0.00 0.16
31
Other comprehensive income
Group
EUR 1.000
Jan-June
2024
Jan-June
2023
Q2 2024 Q2 2023 FY 2023
Result for the period
-1,436 148 -1,124 43 -3,501
Items that may be reclassified to
profit/loss for the year
Exchange differences on translation of for-
eign operations
Tax on other comprehensive income, in-
come/expense
Other comprehensive income, net of tax
Total comprehensive income for the year
-1,436 148 -1,124 43 -3,501
The Parent Company’s shareholders
-1,431 144 -1,118 43 -3,471
Non-controlling interests
-5 4 -6 0 -30
Total comprehensive income for the year
-1,436 148 -1,124 43 -3,501
32
Balance Sheet
ASSETS
Group
EUR 1.000 Note
30 June 2024 30 June 2023 31 December
2023
Investment properties 8
Other receivables
Deferred tax assets
Total non-current assets
Assets held for sales
Trade receivables 9
Income tax receivables
Other receivables
Cash 10
Total current assets
Total assets
EQUITY AND LIABILITIES
Group
EUR 1.000 Note
30 June 2024 30 June 2023 31 December
2023
Share capital 11
Foreign currency translation reserve
Share premium
Retained earnings
Equity attributable to shareholders of the
Parent Company
Non-controlling interests
Total equity
Borrowings 12
Deferred tax liabilities
Other payables
Total non-current liabilities
Borrowings 12
Trade payables
Other payables
Total current liabilities
Total equity and liabilities
33
Statement of Equity (Group)
Group
Share
capi-
tal
Foreign
currency
translation
reserve
Share pre-
mium
Retained
earnings
Equity at-
tributable to
shareholders
of the Parent
Company
Non-cont-
rolling in-
terests
Total
equity
T.EUR
Total equity January 1,
2024
Result for the period 0 0 0 -1,431 -1,431 -5 -1,436
Other comprehensive in-
come, net of tax
Total equity June 30,
2024
Total equity January 1,
2023
Result for the period 0 0 0 144 144 4 148
Other comprehensive in-
come, net of tax
Total equity June 30,
2023
Total equity January 1,
2023
Shares cancelled in 2023 -134 0 0 134 0
Result for the period 0 0 0 -3,471 -3,471 -30 -3,501
Other comprehensive in-
come, net of tax
Total equity December
31, 2023
34
Statement of Cash Flow
Group
EUR 1.000 Note
Jan-June
2024
Jan-June
2023
Q2 2024 Q2 2023 FY 2023
Profit/loss for the period
-1,436 148 -1,124 43 -3,501
Fair value adjustment of investment proper-
ties
Result of discontinued activities before tax
Financial income
-56 -56
-31
-28 -138
Financial expenses
Tax for the yea
r
-467 30 -520 34 -75
Net cash flow from operating activities
before change in net working capital
Change in receivables
Change in trade and other payables
Net cash flow from operating activities
before interest and taxes paid
Financial expenses - net -910 -592 -454 -304 -1,332
Income tax paid/received
Net cash flow from operating activities
after interest and taxes paid
Sale of investment property
Purchase of investment property
Additions during the yea
r
-104 0 -104 0 -111
Net cash flows from investing activities
Proceeds from borrowings
Repayment of borrowings
-3,671 -1,680 -315 -362 -3,328
Cash flow from financing activities
-3,671 -1,680 -315 -362 -288
Net cash flow for the year
Cash and cash equivalents beginning of the period 2,648 7,787 4,265 6,801 7,787
Effects of exchange rate changes on cash
and cash equivalents
Cash and cash equivalents end of the period
35
The property at Schillerstrasse, Frankfurt
36
Notes
Note 1 – Material accounting policy information............................................................................................ 37
Note 2 - Significant Accounting Estimates and Judgments ............................................................................. 42
Note 3 – Segment Information ........................................................................................................................ 43
Note 4 – Staff expenses ................................................................................................................................... 46
Note 5 - Result of discontinued activities after tax.......................................................................................... 47
Note 6 - Value adjustment of investment properties ........................................................................................ 47
Note 7 - Earnings per share (EUR) .................................................................................................................. 48
Note 8 – Investment properties ........................................................................................................................ 49
Note 9 – Receivables from tenants .................................................................................................................. 50
Note 10 – Cash ................................................................................................................................................ 50
Note 11 – Share capital .................................................................................................................................... 51
Note 12 - Financial instruments ...................................................................................................................... 52
Note 13 – Currency exposure .......................................................................................................................... 52
Note 14 - Cash management and other risks ................................................................................................... 53
Note 15 - Contractual obligations .................................................................................................................... 53
Note 16 - Pledges and security arrangements .................................................................................................. 53
Note 17 – Contingent liabilities ....................................................................................................................... 54
Note 18 – Related parties ................................................................................................................................ 54
37
Note 1 – Material accounting policy information
General
The consolidated financial statements are prepared in accordance with the IFRS accounting standards (IFRS)
as approved by the EU, the IFRS decree issued under the Danish Financial Statement Act, and the additional
regulations of Nasdaq Copenhagen for companies with listed shares.
The financial report for the period January 1, to June 30, 2024, are presented in EUR 1,000.
The applied accounting practices are unchanged compared to the annual financial statements for 2023.
New and amended standards adopted by the Group.
No new changes have been implemented in the 1
st
half year 2024.
Consolidation Practices
The consolidated financial statements include the parent company German High Street Properties A/S, as
well as companies in which the parent company directly or indirectly holds the majority of voting rights or
has a controlling influence through share ownership or otherwise.
In the consolidation, items of a similar nature are combined.
The financial statements used for consolidation are prepared in accordance with the group's accounting prac-
tices.
The parent company's capital shares in the consolidated subsidiaries are offset against the parent company's
share of the subsidiaries' book value when the group relationship was established.
Foreign Currency Translation
Functional Currency
In the consolidated financial statements, the items contained in the annual reports of the group companies are
measured in the currency used in the primary economic environment where the companies operate (func-
tional currency). The functional currency is:
For the Danish parent company: DKK
For the German subsidiaries: EUR
Transactions in currencies other than the functional currency are foreign currency transactions.
38
Foreign Currency Transactions
Transactions in a currency other than the functional currency are translated at the exchange rate on the date
of the transaction for initial recognition. Receivables, liabilities, and other monetary items in foreign cur-
rency that have not been settled at the balance sheet date are translated at the exchange rate on the balance
sheet date. Exchange rate differences arising between the exchange rate on the transaction date and the rate
on the payment date or the balance sheet date are recognized in the income statement as financial items. Tan-
gible and intangible assets, inventories, and other non-monetary assets purchased in foreign currency and
measured based on historical costs are translated at the exchange rate on the transaction date. Non-monetary
items revalued to fair value or written down are translated using the exchange rate at the time of revaluation
or write-down.
Presentation Currency
The annual report is presented in EUR (presentation currency) because all the company's significant transac-
tions and accounting items are in EUR.
When recognizing in the consolidated financial statements of companies with a different functional currency
than the Euro (EUR), income statements are converted at the average exchange rates for the year unless these
differ significantly from the actual exchange rates at the times of transactions. In the latter case, the actual
exchange rates are used. Balance sheet items are translated at the exchange rates on the balance sheet date.
Exchange rate differences arising from the translation of balance sheet items at the beginning of the year to
the exchange rates on the balance sheet date and from translating income statements from average rates to
the balance sheet date rates are recognized in other comprehensive income and classified as a separate re-
serve under equity. This translation also includes exchange rate differences arising from the translation of
intra-group balances where settlement is neither planned nor likely in the foreseeable future, as such balances
are considered an addition to or deduction from the net investment. Similarly, other comprehensive income
also recognizes exchange rate differences resulting from changes made directly in the entity's equity.
Revenue
Rental income from investment properties is accrued and recognized in accordance with the terms of the
contracts entered.
Operating Costs of Properties
Operating costs include expenses incurred to achieve the year's revenue. This also includes direct and indi-
rect operating costs in the form of repairs and maintenance that do not add new and improved features to the
properties, as well as property management.
39
Personnel Costs
Personnel costs include wages and staff expenses incurred in the management and administration of the
group.
Administrative Expenses
Administrative expenses include costs incurred during the year for the management and administration of the
group.
Value Adjustment of Investment Properties
Changes in the fair value of investment properties are recognized in the income statement under the item
"Value adjustment of investment properties".
Financial Income and Expenses
Financial income and expenses include interest, realized and unrealized foreign exchange adjustments, and
amortization of loan costs to credit institutions.
Tax on the Year's Result
The current tax for the year and deferred tax for the year are recognized in the income statement for the por-
tion that can be attributed to the year's result, in other comprehensive income for the portion that can be at-
tributed to other comprehensive income, and directly in equity for the portion that can be attributed to equity
transactions.
Changes in deferred tax due to changes in tax rates are recognized in the income statement.
The parent company is jointly taxed with Kartago Property ApS.
Discontinued Operation
The results of discontinued operations are presented separately in the income statement, and the cash flows
from discontinued operations are presented separately in note 5.
Discontinued Operation is defined by the cessation of property operations in a specific geographic region.
40
Items in the Balance Sheet
Investment Properties
Investment properties are properties held to earn rental income and/or capital gains.
Investment properties are initially measured at cost, including the properties' purchase price and any directly
attributable costs.
Subsequently, investment properties are measured at fair value. See note 2 for a description of the measure-
ment of investment properties at fair value.
Costs that add new or improved features to an investment property compared to the time of acquisition and
thereby improve the property's future returns are added to the acquisition cost as improvements. Costs that do
not add new or improved features to an investment property are expensed in the income statement under the
operating costs of the properties.
Interest costs are not included in the cost of investment properties, as these are measured at fair value.
Value adjustments are recognized in the income statement.
Properties expected to be sold are reclassified as "Investment properties held for sale".
Receivables
Receivables are recognized in the balance sheet at fair value at initial recognition and subsequently measured
at amortized cost, corresponding to their nominal value. Impairments on receivables are made when it is ex-
pected that the group will not be able to recover all amounts due by the original terms of the receivables. The
impairment is calculated based on an individual assessment of each receivable and represents the difference
between the carrying amount and the present value of expected future payments.
Liquidity
Liquid assets consist of cash holdings, deposits in bank accounts, and other short-term, highly liquid invest-
ments with an insignificant risk of value changes and with original maturities of no more than three months.
Equity
Dividends proposed by management for distribution for the fiscal year are shown as separate items under eq-
uity.
Purchase and disposal prices and dividends for own shares are recognized directly in retained earnings in eq-
uity.
41
Financial Liabilities
Mortgage loans and loans from credit institutions related to investment properties are recognized at the time
of borrowing, as the proceeds received fewer transaction costs incurred. In subsequent periods, the loans are
measured at amortized cost, so the difference between the proceeds and the nominal value is recognized in
the income statement as an interest expense over the loan period using the effective interest method.
Loans are classified as short-term liabilities unless the group has an unconditional right to defer the debt set-
tlement for at least one year from the balance sheet date.
Deferred Tax
Using the balance sheet liability method, deferred tax is recognized on all temporary differences between the
accounting and tax values of assets and liabilities.
Deferred tax is measured based on the tax rules and tax rates applicable under the legislation at the balance
sheet date when the deferred tax is expected to be realized as the current tax. In cases where the valuation of
the tax value can be performed under alternative taxation rules, deferred tax is measured based on the
planned use of the asset or settlement of the liability. Deferred tax on investment properties is calculated as
the tax effect of selling the properties at their accounting value on the balance sheet date.
Deferred tax assets, including the tax value of tax losses that can be carried forward, are measured at the
value at which the asset is expected to be realized, either through offsetting in the tax of future earnings or by
offsetting against deferred tax liabilities.
Fair Value Measurement and Disclosure
The fair value of financial instruments traded in an active market is measured at the latest quoted price. The
fair value of financial instruments not traded in an active market is calculated based on a valuation model
using discounted cash flows.
The valuation is based as far as possible on observable market data. The fair value of loans is based on the
company's current interest rate for comparable loans.
Cash Flow Statement
The cash flow statement shows the group's cash flows for the year, divided into operating, investing, and fi-
nancing activities, the year's change in liquidity, and the group's liquidity at the beginning and end of the
year. The liquidity effect of purchases and sales of businesses is shown separately under cash flows from in-
vesting activities. In the cash flow statement, cash flows relating to purchased companies are recognized
from the date of acquisition, and cash flows relating to sold companies are recognized up to the date of sale.
The cash flow statement is prepared using the indirect method based on the year's profit before tax.
42
Cash Flows from Operating Activities
Cash flow from operating activities is calculated as the year's profit adjusted for changes in working capital
and non-cash income items such as depreciation and provisions. Working capital includes short-term assets
minus short-term liabilities, excluding items included in liquidity.
Cash Flows from Investing Activities
Cash flow to investing activities includes cash flows from purchasing and selling intangible, tangible, and
financial fixed assets.
Cash Flows from Financing Activities
Cash flow from financing activities includes cash flows from raising and repaying long-term debt obliga-
tions, as well as payments to and from the company's participants.
Liquidity
Liquid holdings in the cash flow statement include bank account deposits and other short-term, easily trada-
ble investments with an insignificant risk of value change, which are not pledged as security.
Liquid holdings in the balance sheet include those available for free use and those pledged as security for
lenders.
The cash flow statement cannot be derived solely from the published financial statements.
Note 2 - Significant Accounting Estimates and Judgments
In preparing financial statements, management makes several estimates and judgments regarding future con-
ditions, involving measuring accounting assets and liabilities.
Management considers the following estimates and judgments the most significant for the group.
Measurement of Investment Properties at Fair Value
The management assesses that the selected accounting policy, where investment properties are measured at
fair value, provides the best expression of the group's assets and liabilities, financial position, and the results
of the group's activities.
The chosen accounting policy can have significant implications for the income statement and balance sheet,
as fluctuations in fair value during the financial year will affect the measurement of investment properties in
the balance sheet and will be reflected in the income statement.
43
Alternatively, investment properties could be measured at cost less depreciation, with consequent impacts on
the balance sheet and income statement from write-ups and write-downs.
The best evidence of fair values for the group's investment properties is current prices in an active market for
similar investment properties. In the absence of such information, fair value is determined within a range of
probable estimated values.
Management's estimate of the value of the investment properties is set based on market-consistent standards
and relies on an individual assessment of the expected ongoing returns, maintenance condition, and yield re-
quirements of the investment properties.
The fair value of the German investment properties as of June 30, 2024, is set at EUR 89.5 million. The in-
vestment properties' value is determined by property based on a gross capitalization factor between 12.50
and 25.50 or an average of 19.00.
Tax
The group has taxable activities in Denmark and Germany, and the current tax is calculated based on the ex-
pected taxable incomes in both countries. If the tax authorities, upon reviewing the group's tax returns, disa-
gree with the estimates made, the previously calculated tax can change.
Additionally, deferred tax is calculated based on an assessment of the future current tax that will be payable
in relation to items in the financial statements. This assessment is based on expectations of future taxable
profits and tax planning strategies, including expectations regarding exit strategies. Future changes in legisla-
tion governing corporate tax rules and other changes in these expectations, including whether the sale occurs
as a sale of shares or as a sale of individual properties, can thus cause the future payable tax to differ signifi-
cantly from the calculated deferred tax.
Note 3 – Segment Information
The group has thirteen German retail properties in major cities in western Germany. The activities are man-
aged, reported, and presented in German properties and Administration in 2024. The income statement for
the period from January 1 to June 30, 2024, is divided into the following segments.
44
Profit January 1 to June 30, 2024, Segment Information
EUR 1000
German
Properties
Administra-
tion
Group
Revenue 2,606 0 2,606
Property operation expenses -950 0 -950
Operating income 1,656 0 1,656
Staff expenses -60 -157 -217
Administrative expenses -52 -428 -480
Result before fair value adjustments and inter-
ests
1,544 -585 959
Fair value adjustment of investment properties -1,604 0 -1,604
Result before interests and tax -60 -585 -645
Financial expenses, net -966 56 -910
Result of continuing activities before tax -1,026 -529 -1,555
Profit January 1 to June 30, 2023, Segment Information
EUR 1000
German
Properties
Administra-
tion
Group
Revenue
2,182 0 2,182
Property operation expenses
-702 0 -702
Operating income
1,480 0 1,480
Staff expenses
-35 -222 -257
Administrative expenses
-32 -421 -453
Result before fair value adjustments and inter-
ests
1,413 -643 770
Fair value adjustment of investment properties
0 0 0
Result before interests and tax
1,413 -643 770
Financial expenses, net
-648 56 -592
Result of continuing activities before tax
765 -587 178
45
Profit January 1 to December 31, 2023, Segment Information
EUR 1000
German
Properties
Administra-
tion
Group
Revenue
4,535 0 4,535
Property operation expenses
-1,564 0 -1,564
Operating income
2,971 0 2,971
Staff expenses
-141 -387 -528
Administrative expenses
-328 -516 -844
Result before fair value adjustments and inter-
ests
2,502 -903 1,599
Fair value adjustment of investment properties
-5,111 0 -5,111
Result before interests and tax
-2,609 -903 -3,512
Financial expenses, net
-1,180 -152 -1,332
Result of continuing activities before tax
-3,789 -1,055 -4,844
Balance sheet June 30, 2024, Segment information:
EUR 1000
German
Properties
Administra-
tion
Group,
total
Assets
Investment properties
89,500 0 89,500
Other receivables
0 1,329 1,329
Deferred tax assets
0 165 165
Total non-current assets 89,500 1,494 90,994
Trade receivables
242 0 242
Income tax receivables
0 0 0
Other receivables
911 175 1,086
Cash
2,041 1,980 4,021
Total current assets 3,194 2,155 5,349
Total assets 92,694 3,649 96,343
46
Equity and liabilities
Equity 60,623 -4,350 56,273
Total equity 60,623 -4,350 56,273
Borrowings
32,680 0 32,680
Deferred tax liabilities
4,494 514 5,008
Other payables
0 0 0
Total non-current liabilities 37,174 514 37,688
Borrowings
1,306 0 1,306
Trade payables
191 114 305
Payables to group entities
-7,371 7,371 0
Other payables
771 0 771
Total current liabilities -5,103 7,485 2,382
Total equity and liabilities 92,694 3,649 96,343
Note 4 – Staff expenses
The company has three employees. In 2024, the director's remuneration is EUR 120,000 per annum and in-
cluded in the salaries expense. Remuneration for the company administration agreement is detailed in note
18 “Related parties”.
47
Note 5 - Result of discontinued activities after tax
Group
EUR 1.000
Jan-June
2024
Jan-June
2023
Q2 2024 Q2 2023 FY 2023
Revenue
0 0 0 0 84
Property operation expenses
0 0 0 0 -6
Result before fair value adjustments
and interests
0 0 0 0 78
Change in value and gains/losses from as-
sets held for sales
-446 0 0 0 629
Financial expenses
0 0 0 0 -78
Result of discontinued activities before
tax
-446 0 0 0 629
Tax of discontinuing activities
98 0 0 0 -137
Result of discontinued activities after
tax
-348 0 0 0 492
Earnings per share (EUR), discontinuing
activity
-0.11 0.00 0.00 0.00 0.16
EUR 1.000
Jan-June
2024
Jan-June
2023
Q2 2024 Q2 2023 FY 2023
Net cash flow from operating activities
after interest and taxes paid
0 0 0 0 172
Net cash flows from investing activities
4,583 0 0 0 -4,745
Cash flow from financing activities
-2,994 0 0 0 4,670
Net cash flow for the yea
r
1,589 0 0 0 97
Discontinued activities concern the sale of the property at Hessevang 11, Grenaa, according to stock ex-
change announcement no. 250 dated December 29, 2023. The sale of the property takes effect from January
15, 2024.
Note 6 - Value adjustment of investment properties
The year's value adjustment is calculated as the difference between the fair value, EUR 89.5 million as of
June 30, 2024, and the value as of December 31, 2023, EUR 91.0 million, adjusted for the year's additions
and disposals, as well as currency exchange adjustment.
48
Note 7 - Earnings per share (EUR)
Earnings per share (EUR), continuing ac-
tivity
Group
Jan-June
2024
Jan-June
2023
Q2 2024 Q2 2023 FY 2023
Result of continuing activities after tax
-1,088 148 -1,124 43 -3,993
Weighted average number of outstanding or-
dinary shares in thousands
3,045 3,045 3,045 3,045 3,045
Earnings per share (EUR), continuing ac-
tivity
-0.36 0.05 -0.37 0.05 -1.31
Earnings per share (EUR), discontinuing
activity
Group
Jan-June
2024
Jan-June
2023
Q2 2024 Q2 2023 FY 2023
Result of discontinued activities after tax
-348 0 0 0 492
Weighted average number of outstanding or-
dinary shares in thousands
3,045 3,045 3,045 3,045 3,045
Earnings per share (EUR), discontinuing
activity
-0.11 0.00 -0.11 0.00 0.16
Earnings per share (EUR), Result for the
period
Group
Jan-June
2024
Jan-June
2023
Q2 2024 Q2 2023 FY 2023
Result of discontinued activities after tax
-1,436 148 -1,124 43 -3,501
Weighted average number of outstanding or-
dinary shares in thousands
3,045 3,045 3,045 3,045 3,045
Earnings per share (EUR), Result for the
period
-0.47 0.05 -0.47 0.05 -1.15
49
No equity instruments with a diluting effect have been issued. Diluted earnings per share are equal to earn-
ings per share.
Note 8 – Investment properties
Group
EUR 1.000
Jan-June
2024
Jan-June
2023
Q2 2024 Q2 2023 FY 2023
Costprice beginning of the year
56,801 56,690 56,801 56,690 56,690
Additions/improvements during the year
104 0 104 0 111
Additions, Hesselvang 11, Grenaa
0 0 0 0 0
Disposal, GHSP Botkyrka Fastigheder AB
0 0 0 0 0
Costprice end of the year
56,905 56,690 56,905 56,690 56,801
Value adjustments
Value adjustments beginning of the year 34,199 39,310 34,199 39,310 39,310
Disposal, GHSP Botkyrka Fastigheder AB
0 0 0 0 0
Fair value adjustment of investment proper-
ties, net
-1,604 0 -1,604 0 -5,111
Value adjustments end of the year
32,595 39,310 32,595 39,310 34,199
Book value at the end of the period
89,500 96,000 89,500 96,000 91,000
Group
EUR 1.000
Jan-June
2024
Jan-June
2023
Q2 2024 Q2 2023 FY 2023
Cost price beginning of the year
4,745 0 0 0 0
Additions/improvements during the year
0 0 0 0 0
Additions, Hesselvang 11, Grenaa
0 0 0 0 4,745
Disposal, Hesselvang 11, Grenaa
-4,745 0 0 0 0
Cost price end of the year
0 0 0 0 4,745
Value adjustments
Value adjustments beginning of the year 629 0 0 0 0
Disposal, Hesselvang 11, Grenaa
-629 0 0 0 0
Fair value adjustment of Hesselvang 11,
Grenaa
0 0 0 0 629
Value adjustments end of the year
0 0 0 0 629
Book value at the end of the period
0 0 0 0 5,374
50
German investment properties are valued by the board based on the model described in note 2. The value of
the German investment properties amounts to a total of EUR 89.5 million (2023: EUR 91.0 million) and is
determined property by property. The valuation corresponds to a gross capitalization factor between 12.50
and 25.50, with an average of 19.00 (2023: 19.30).
The method used for valuing investment properties is based on the future expected income streams from the
property. The future expected income streams are calculated as the expected annual net income (rental in-
come, minus any vacancy periods, and expected operating expenses such as maintenance, insurance, taxes,
and administration) divided by the capitalization factor. The capitalization factor is a key indicator of the in-
vestment's return potential and the associated risk. Finally, the calculation takes into account other factors
such as the sale prices of similar properties in the same area and whether the property has special features,
such as future development opportunities or unique lease conditions. The result of the above calculation then
determines the value of the property.
Note 9 – Receivables from tenants
Group
EUR 1.000
Jan-June
2024
Jan-June
2023
Q2 2024 Q2 2023 FY 2023
Receivables from tenant
242 322 38 -71 256
Provision for losses -62 -277 -20 0 -92
Total receivables from tenant
180 45 18 -71 164
The provision for losses as of June 30, 2024, is 62 T.EUR.
As of June 30, 2024, EUR 242 thousand were overdue, compared to EUR 256 thousand as of December 31,
2023.
Write-downs are made based on an individual assessment of receivables from leases to the extent the group
expects to be unable to recover the arrears. There is no significant concentration of credit risk with individual
tenants. It is assessed that the provisions made are sufficient to ensure that receivables from leasing will be
settled.
Note 10 – Cash
Of the Group’s cash position as of June 30, 2024, EUR 0.0 thousand are pledged as security for rental depos-
its. Other cash and cash equivalents as of June 30, 2024, EUR 4.0 million (as of June 30, 2023: EUR 6.1 mil-
lion), are freely available.
Cash and cash equivalents are held in Jyske Bank, a systemically important financial institution (SIFI);
hence, the credit risk is assessed as limited.
51
Note 11 – Share capital
Development in share capital:
A shares and B shares represent the company's original share classes.
From 2018, the share classes have been merged such that there is only
one share class, according to the table below.
DKK 1.000
Shares
A-shares B-shares
Contribution at establishment in 2007
0
100 900
Cash capital increase through stock market issuance in 2007
0
3,550 31,951
Cancellation of shares
0
0 -6,047
Partial merger of A shares and B shares in 2017
0
-2,750 2,750
Remaining merger of A shares and B shares and consolidation into
one share class
30,454
-900 -29,554
Total share capital, DKK
30,454
0 0
EUR 1.000
Shares
A-shares B-shares
Contribution at establishment in 2007
0
13 120
Cash capital increase through stock market issuance in 2007
0
476 4,284
Cancellation of shares
0
0 -811
Partial merger of A shares and B shares in 2017
0
-369 369
Remaining merger of A shares and B shares and consolidation into
one share class
4,082
-120 -3,962
Total share capital, EUR
4,082
0 0
The share capital consists of 3,045,383 shares with a nominal value of DKK 10 each, each granting one vote.
The shares are listed on Nasdaq Copenhagen. All shares are subscribed at EUR 13.4 (DKK 100) and the share
premium at establishment and capital increase thus totals EUR 44.0 (DKK 328.5 million). The share capital is
fully paid.
52
Shares in circulation:
Shares
A-shares B-shares
Contribution at establishment in 2007
100,000
10,000 90,000
Cash capital increase through stock market issuance in 2007
3,550,083
355,008 3,195,075
Cancellation of shares 2015
-504,700
0 -504,700
Cancellation of shares 2023
-100,000
0 -100,000
Remaining merger of A shares and B shares and consolidation into
one share class
0
-275,000 275,000
Abolition of A shares and B shares
0
-90,008 -2,955,375
Total shares
3,045,383
0 0
Own shares:
The company is authorized by the general meeting to acquire its own shares up to a maximum of 20% of the
company's share capital at any given time until April 28, 2028. Own shares are acquired for the purpose of
placing the company's surplus liquidity.
Note 12 - Financial instruments
The company has financed itself with the following loan:
Loan tranche 1 is a 10-year loan initially amounting to EUR 46,0 million with a variable interest rate, with a
current interest rate as of June 30, 2024, including the interest margin, of approximately 5.3% p.a. (as of June
30, 2023, the interest rate including the interest margin was approximately 4.9% p.a.)
The nominal remaining debt on the loan is EUR 34.0 million as of June 30, 2024 (as of June 30, 2023, it was
EUR 36.3 million).
A change of 1.0 percentage point in the general interest rate level would result in a change in the group's an-
nual interest expense before tax of 340 T.EUR.
The company repays EUR 1.3 million annually on the loan.
Note 13 – Currency exposure
The parent company's shares are denominated in DKK, while the group's investments, revenues, and ex-
penses are incurred in DKK or EUR. Thus, all assets and liabilities are denominated in EUR. Therefore, the
group's equity, and thereby the parent company's ability to distribute dividends, is exposed to changes in the
exchange rate.
Furthermore, the management assesses the currency risk associated with investments in EUR as minimal
compared to DKK.
53
Note 14 - Cash management and other risks
The group's objective is to ensure the possibility of continued operations to optimize shareholders' returns
and improve the capital structure to minimize financial costs.
The company's ability to accumulate sufficient liquidity depends on the group's operating results and the pos-
sibility of obtaining external financing. The group's ability to pay dividends is limited according to the rules
of the Companies Act, as the company can legally pay dividends only if it has sufficient free liquidity ac-
cording to the company's annual report and if the company, in the board's opinion, has a prudent level of cap-
ital reserves relative to the group's operations and obligations after the distribution.
In addition to liquidity management, the group assesses its capital reserves based on solvency, which is cru-
cial for its ability to obtain external financing. In line with its strategy, the company has a solid capital struc-
ture with relatively low leverage, with a solvency ratio as of June 30, 2024, of 58.4% (as of June 30, 2023, of
58.4%).
Other risks such as credit risk, market risk, currency risk, interest rate risk and refinancing and liquidity risks
are described on page 19 – 22.
Solvency is calculated as follows.
Group
EUR 1.000
Jan-June
2024
Jan-June
2023
Q2 2024 Q2 2023 FY 2023
Total Equity
56,273 61,358 56,273 61,358 57,709
Total Assets
96,343 105,138 96,343 105,138 102,121
Solidity (in %)
58.4% 58.4% 58.4% 58.4% 56.5%
Note 15 - Contractual obligations
The group has entered into a non-terminable management agreement with Administrationsselskabet Gambit
ApS until December 31, 2028. Besides, the group has only entered contractual obligations customary for a
real estate company.
Note 16 - Pledges and security arrangements
The group's investment properties in Germany, with an accounting value as of June 30, 2024 of EUR 89.5
million (as of June 30, 2023: EUR 96.0 million), are pledged as security for EUR 34.0 million in bank loans.
The borrower has secured a deposit of EUR 1.5 million until January 2025 with the lender to waive this
DSCR clause (see page 22).
There are no other security arrangements.
54
Note 17 – Contingent liabilities
The parent company is jointly and severally liable for the tax on the taxable income of the group taxation
members. It is also jointly and severally liable for Danish withholding taxes, such as dividend tax, interest
tax, etc. Any subsequent corrections to corporate taxes and withholding taxes may result in the company's
liability being larger.
The company must pay the company administrator 12 months of administration after the property is disposed
of. This obligation ceases when the management agreement expires in 2028.
Note 18 – Related parties
Alexander and Kristoffer Thygesen control the group through Drot ApS and Marsk ApS, which together are
the controlling shareholders in Kartago Property ApS and Kartago ApS, owning 39.87% and 11.99% of the
share capital and votes, respectively.
The accounts for German High Street Properties are included in the consolidated accounts of Kartago Prop-
erty ApS.
The group's related parties also include the parent company's board of directors, executive management, and
their close family members. Related parties also include companies in which the individuals mentioned
above have control or joint control.
In addition to the shareholdings mentioned above controlled by Alexander and Kristoffer Thygesen, the
board of directors, executive management, and companies where this group of persons has a controlling in-
fluence hold 200 shares.
Transactions with companies controlled by the Thygesen family have only included administration fees, re-
muneration of the director in accordance with the management agreement, and a minor prepayment for ad-
ministration fees, which is usually invoiced at the end of the quarter for the upcoming quarter.
Remuneration of the board amounted to a total of T.EUR 151.0 for the year 2024 (2023: T.EUR 163.0).
The executive management's remuneration is EUR 0.12 million and is settled by German High Street Proper-
ties A/S. The executive management is closely related to the Kartago group.
55
Property in Leverkusen