4. DETAILED INFORMATION ON STATEMENT OF FINANCIAL POSITION ITEMS
4.1 Investment properties
The positive market environment for office spaces led to a value increase of the portfolio of CHF 1.0 million. Weighted average lease term (WALT) decreased in the first half year from 5.2 years to 4.7 years.
The principles and assumptions applied in the valuation of the investment properties are set out in the valuation report.
4.2 Equity
Treasury shares
The Züblin Group does not hold any treasury shares as of reporting date. Like in the previous year, no transactions with treasury shares took place in the current financial year.
Distribution from capital contribution reserves
The Annual General Meeting of Züblin Immobilien Holding AG on 21 June 2018 approved a distribution of CHF 1.00 per registered share from the capital contribution reserves. This corresponds to a total amount of kCHF 3 318. On 27 June 2018, a distribution of kCHF 1 936 was made in favour of the shareholders. The dividends attributable to Lamesa Holding SA was carried as a liability in the balancs sheet item "liabilities to participants".
4.3 Future contractual maturities
Based on the financial liabilities as of 30. September 2018 the following future contractual payment obligations exist (undiscounted amounts):
Trade accounts payable and the other short-term liabilities are incurred in the course of the Groupʼs operating activities and are covered by the short-term assets.
4.4 Mortgages
As of 30 September 2018 Züblin Groupʼs real estate portfolio is financed entirely by one variable-rate loan. The amounts shown as mortgages in the balance sheet include closing fees of CHF 0.3 million (previous year CHF 0.3 million). These closing fees are also reflected in the calculation of the average effective interest rate.
The mortgage includes financial covenants which specify, among other things, adherence to certain financial indicators (loan-to-value ratio and equity ratio). The financial covenants are summarized in the table below:
Züblin monitors compliance with these covenants on a quarterly basis. The breach of a covenant may have a variety of consequences and can result among other consequences in a higher interest rate or a (partiall) repayment of the loan. If the LTV rises above 60%, the company has the opportunity to restore compliance with this financial covenant. The mortgage agreement also contains a “change of control” clause which stipulates the repayment of the entire loan if Züblin Immobilien Holding AG holds less than 50.1% of the voting rights or shares in the borrowing subsidiary.
As of balance sheet date, the Company was in compliance with all of its covenants.
The table below summarizes the value of investment properties pledged as security for mortgages:
Insurance policies for investment properties have been pledged as security over and above the mortgage lines.
