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Tuesday, 28.03.2017, 16:58
Revenue of Estonian real estate co Arco Vara falls to EUR 9.7 mln in 2016
"Of the targets set for 2016, we achieved the necessary internal growth but did not achieve profit. It is hard to reach profit without selling anything and without revaluating your assets," CEO Tarmo Sild said in a stock exchange disclosure. "I am not proud of the results of Q4 and the full year, but I also do not think they are bad results. I see how the results of 2016 will lead us to sales in 2017 and the years thereafter. Presales of development products have been good and this will be recorded as revenue in 2017."
Sild said the company's results for the full year were damaged by the fourth quarter when Arco Vara did not sell anything. In his words, there were several reasons for the full-year loss: failure to let out the offices in the Madrid Boulevard development in Sofia, Bulgaria, which resulted in a loss of rental income of at least 400,000 euros and write-down of the value of the building by 400,000 euros; sale of the Baltezers-3 undeveloped residential land plots in Latvia at an accounting loss of 200,000 euros in the fourth quarter; and a loss of 200,000 euros from evaluation and brokerage services.
Arco Vara targets sales of at least 18 mln euros and hopes to net at least 1.8 mln euros in 2017. "For this, we need to sell at least 120 apartments and serve at least 6,000 appraisal and brokerage customers. By the end of 2018, we wish to earn at least 20 million euros and make a net profit of at least two million euros, which is a new level in the group's history and a new threshold for the group's future years," the CEO said.