Appeninn’s profits for 2025 fell significantly, with the company’s profit after tax dropping to €3.8 million from €15.6 million a year earlier. The weaker profit was primarily due not to a deterioration in operational performance, but to foreign exchange effects linked to the revaluation of property and a deterioration in financial results, whilst the lettings business remained essentially stable.

The Apennines income from letting In 2025, it stood at 22.9 million euros, representing a slight decrease compared with the 23.1 million euros recorded in 2024. Within this, traditional rental income fell to €18.3 million, whilst operating income stood at €4.6 million. In geographical terms, revenue from the Hungarian portfolio remained virtually unchanged, whilst the contribution from the Polish portfolio fell slightly.

In terms of revenue, the office segment remains the most significant, generating €14.8 million in rental income, whilst retail properties generated revenue of around €8 million. The logistics segment remained relatively small.

Based on the figures, therefore, there was no dramatic change on the topline, and the core business continued to demonstrate a stable ability to generate cash.

A direct property management costs At the same time, they increased, rising to €7.7 million from €7.2 million in 2024. Within this, the rise in operating charges, as well as property and land taxes, was particularly striking, which also dragged down the direct coverage. Thus, the direct collateral It fell to €15.3 million from €15.9 million the previous year. Based on these figures, whilst the portfolio continues to generate revenue, cost pressures have already had a noticeable impact on profitability.

However, the really significant change is not to be found in the operating figures, but in the revaluations.

Whilst in 2024 the change in the fair value of property contributed a positive €1.9 million to the result, by 2025 this line item was showing a negative impact of €7.3 million. It is important to note, however, that this was not primarily due to a significant fall in the market value of the portfolio; indeed, the book value of investment properties actually rose in 2025. The negative impact on the result was primarily due to the revaluation to the presentation currency, i.e. the foreign exchange effect associated with the strengthening of the forint. This essentially explains in itself why the pre-tax profit fell so sharply. The largest negative item was linked to the revaluation of the Wisniowy Business Park in Poland, which reduced the profit by more than €2.8 million, whilst there were also significant write-downs on assets exposed to the office market.

The financial results also deteriorated. Other results from financial operations improved the result by a further €1.4 million in 2024, but showed a loss of €0.6 million in 2025. In addition, net interest income also weighed on the figures; although interest income rose due to the high level of cash holdings, this was more than offset by the increase in interest expenses relating to bank loans and bonds. Net interest income therefore amounted to minus 2.5 million euros.

From administrative costs also rose sharply, to 875,000 euros from the previous 480,000 euros. The main increases were in audit, accounting, legal, consultancy and banking costs. By contrast, staff-related expenses fell slightly, and the number of employees also decreased. The other income This line item, however, brought a positive surprise, showing a net surplus of 742,000 euros following a figure of virtually zero in 2024, aided, amongst other things, by compensation relating to the termination of the contract and interest subsidies. However, this was only able to partially offset the revaluation and financing pressures.

The balance sheet and cash flow statement present a mixed picture overall. The portfolio of investment property rose to €170.6 million, whilst the portfolio of assets held for sale stood at €10.5 million. The company’s cash position rose to €56.2 million from the previous €47 million, whilst operating cash flow remained strong at €12.8 million. This is an important stabilising factor. Meanwhile, equity rose to €128.5 million, and net asset value per share increased to €2.7 from €2.5. In other words, although accounting profit fell sharply, the balance sheet position and liquidity did not deteriorate; indeed, several key indicators improved.

With a view to the coming period, it is particularly important that the company has already put several properties up for sale in 2024, and, according to the report, it entered into contracts and preliminary agreements for these in February 2026. According to the company, these sales are likely to be realised at a price close to the value determined on the reporting date; consequently, no significant impact on profits is expected for the coming year. At the same time, the transactions may contribute to streamlining the portfolio and further optimising the capital structure.

Overall, Appeninn’s 2025 figures appear weak at first glance, as Profit after tax fell to a quarter of its previous level, whilst EPS fell from 32.9 euro cents to 8.1 euro cents. However, a closer look at the details reveals that the decline in profits was not primarily due to a collapse in the lettings business, but rather to foreign exchange effects linked to revaluations, higher costs and financing pressures. Core operations remain stable, cash flow remains strong, and rental income is essentially holding steady, However, valuation pressures in the office market and financing costs are posing a significant headwind for the company.

Appeninn’s share price has fallen by 18.3 per cent since the start of the year.

source Appeninn’s profits have taken a big hit – We explain what’s behind it – Portfolio.hu