Texaf Q1 FY25: Solid Performance In RE; New Projects Boosting Growth

During Q1 FY25, TEXAF's real estate segment delivered robust performance despite DRC's challenging geopolitical environment, achieving near 100% occupancy and €7.7m in rental income from Kinshasa's residential and office properties, up 29% YoY. Growth was driven by the new Promenade des Artistes (94 apartments) and 6,000 m² of additional coworking/private office space at Silikin Village Phase III, with private office occupancy exceeding 90% (75%/35% for fixed/flexible coworking spaces). Like-for-like rental income rose 6%. The sandstone quarry in Kinshasa (Carrigres) saw sales drop 52% versus Q1 2024, to €0.8m. Management cites a 40% drop in market values, resulting in oversupply at competitors, leading to significant sandstone price reductions. We continue to believe that Texaf currently holds a dominant position within Kinshasa's high-end RE rental market. With new projects in the pipeline, TEXAF's position will solidify and help capture additional market share in an high risk high growth market. We maintain our BUY rating and €45.0 TP.