WOOD Flash – GTC: dismisses CEO Thomas Kurzmann, replacement yet to be announced
GTC has announced that it has dismissed acting CEO Thomas Kurzmann. According to our understanding, the new investor, a fund linked to the National Bank of Hungary, has not yet announced a new candidate for the position. In our view, Thomas Kurzmann has been instrumental in the transformation GTC has undergone since Lone Star purchased a controlling stake. He sold out of the various legacy non-performing properties and land plots, raised capital successfully and restarted the development pipeline. During his tenure, the FFO increased, from around EUR 15m in 2013 to around EUR 70m last year. The quality of the portfolio improved, the leverage declined and, for the first time in its history, GTC started to pay a dividend. We see this news as negative, especially given the lack of visibility on his replacement. While we have been flagging the change of management as an important potential risk factor, following the Lone Star stake sale, we had hoped that the new shareholder would offer at least a temporary extension of Thomas Kurzmann's and Erez Boniel’s contracts. Considering the volatile external environment, we would have preferred that the new investor had waited a little longer before making changes to a team that has been delivering consistently on its promises and exceeding the market’s expectations throughout its tenure.Globe Trade Centre is the parent company of the capital group, Globe Trade Centre (the Group). The Group is engaged in the development and rental of office and retail space and the development and sale of residential units. The Group is a real estate company in Central and Eastern Europe and South-eastern Europe, operating in Poland, Romania, Hungary, Croatia, Serbia, Bulgaria, and Slovakia. Additionally, it co-owns land in Ukraine and Russia and operates in the Czech Republic. The Group's portfolio comprises: completed office buildings and office parks as well as retail and entertainment centres; residential projects; and undeveloped plots of land and suspended projects.
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