Advance Terrafund sells another 1 069 dca of farmland in December 2016

ELANA Agrocredit

Biggest land REIT, Advance Terrafund sells another 1 069 dca of farmland in December with full year sales reaching 15 168 dca, according to the fund’s regular monthly newsletter. Overall fund’s performance for the FY2016 is above ELANA Trading analysts’ expectations.

Farmland deals 2016

The Company’s annual sales revenues to reach BGN 20m with an average price of BGN 1 318 per dca. The latter is down 4% y/y, first decrease since the REITs inception.

Simultaneously, the Company acquired 1 125 dca at an average price of BGN 851/dca, totaling 9 026 dca of purchases at an average price of BGN 855/dca for the full year.

Rental income for the 2016-2017 farmland expected at BGN 6.4m, down 19.2% y/y, on lower rented land and lower rents.

Dividend planned for June 2017

Advance Terrafund has published its annual corporate calendar.

According to it, dividend from 2016 gains it planned for distribution in June 2017. Back in November 2016 the Company announced expectations for 4.9% dividend yield for 2017 distribution.

Monthly newsletter with December data is published here

About one of the biggest owners of Bulgarian farmland

Advance Terrafund is the largest REIT owner of agricultural land in Bulgaria. It is also one of the largest owners of land in the country after the Bulgarian state. It owns 23K ha of arable land which it rents or leases to farmers. The Fund’s holdings are mainly concentrated in the most fertile regions of the country: 40% of the land is in North-East Bulgaria.

The Company was established in 2005 to take advantage of the consolidation wave in the agricultural sector as arable land was highly fragmented at time point in time. In addition, it took advantage of the lower land prices which almost tripled from the EU accession of Bulgaria (2007) until nowadays.

Read more in ELANA Trading equity research reports