For the past year, the badly hit Adler Group shows a loss in the billions. Management continues to try to turn the company around without breaking it up.
The Adler Group is still deep in the crisis. The ailing real estate group is also reporting a billion-dollar loss for 2022. The bottom line was a deficit of almost 1.7 billion euros due to a devaluation of the real estate portfolio and the value adjustment on receivables, as the Adler Group in Luxembourg announced. A year earlier, the company had already reported a loss of almost 1.2 billion euros. According to an assessment by independent experts, the value of the rental portfolio at the end of 2022 was 1.9 percent below the previous year’s value at EUR 5.2 billion.
Still no new one Auditors
The figures are unaudited because the group has not yet found a new auditor. Last year, the auditing company KPMG refused the group the attestation for the 2021 annual financial statements and ended their mandate due to different opinions. While an auditor was found for the German subsidiary in Rödl & Partner, this is out of the question for the Adler Group because of the group’s headquarters in Luxembourg. Supervisory Board Chairman Stefan Kirsten does not expect that an auditor can be found before the Annual General Meeting in May.
The company has been tackling its restructuring plan since mid-April. In November, the group reached an agreement with its creditors. This was “a crucial milestone on the way to securing the group’s financial stability,” said CEO Thierry Beaudemoulin. A London court has just confirmed the plan against the objection of creditors.
“No Breakup”
The plan is to pay off the multi-billion dollar debt without a complete sell-off. “We’re not breaking up,” said CFO Thomas Echelmeyer. However, the company must continue to sell real estate. The aim is to keep a Berlin portfolio – “with a significantly smaller scope and a significantly smaller project development portfolio”.
The company also announced that Adler had achieved its operational business targets in 2022. The operating result from rentals shrank from EUR 137.1 million to EUR 86.8 million after real estate sales. Net rental income fell from 346 to 244.5 million euros. In the current year, these are expected to drop to between 207 and 219 million euros.
tampering allegations
Adler has already been able to avert insolvency several times, emphasized the head of the board of directors, Stefan Kirsten. The group is still in “rough seas”. The turbulence at Adler was also triggered by allegations by the Viceroy company of short seller Fraser Perring, who accused the real estate group of fraud, manipulation and deception of its financiers. Adler had denied Fraser’s allegations.
Perring described a group of shareholders and managers at Adler and those around the group as the beneficiaries of the alleged machinations. These are said to have belonged to a network around the Austrian entrepreneur Cevdet Caner, who allegedly controls the real estate group from the background. Also one ARD-Documentation suggests such a network.