Advance Terrafund REIT (6A6 BU) sold farmland for BGN 685k in January 2017, the Company announced in a statement.

It sold 472 dca of arable land for an average price of BGN 1 450/dca. The plots were part of a 2015 financial leasing contract, thus the average selling price should include a preliminary negotiated return for Advance Terrafund.

No new farmland purchases

In January 2017, the Company did not buy new land. It manages a portfolio of 225k dca of land, including the land with deferred payments or financial leasing agreements. In 2016 Advance Terrafund purchased  9 026 dca farmland at the average price of BGN 855 per dca.

Management expects BGN 6.4m in rental income for the 2016/2017 agriculture year, down 17% y/y on less rented land and lower rents. About 41% of the income has been collected so far. In the previous agricultural year 84,4% of the receivables due have been collected.

2016 profit dividend planned for June

Earlier this year Advance Terrafund REIT announced dividend from 2016 profits will be paid in June 2017. The General Meeting of Shareholders to vote for it is planned to be in May like last year.

Background

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.

Advance Terrafund REIT Monthly bulletin for investors

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