Instone Real Estate Group SE achieved solid business development in the first half of 2026. This occurred in an overall economic environment marked by geopolitical burdens. Despite increased interest from private and institutional investors and higher sales volumes, a stronger recovery in demand, particularly from private investors, was dampened by ongoing uncertainties.
The institutional business is showing positive development, which is attributable to the Instone Group's product offering, including a high proportion of subsidised housing. Transactions totalling approximately EUR 150 million are currently in advanced negotiations. A stabilisation of the geopolitical situation in the coming months could lead to an acceleration of growth and an increase in sales. Planned institutional sales, seasonal effects, and further retail sales launches are considered essential factors in this regard. The forecast for the 2026 financial year can, according to current assessment, be confirmed at the lower end of the range.
Adjusted revenue amounted to EUR 184.2 million in the first half of 2026, which is below the previous year's level (EUR 231.0 million in H1-2025). This is primarily due to lower performance from already sold projects and weather-related construction delays. However, expected closures from institutional sales and a revitalisation in retail sales are expected to lead to a significant increase in revenue in the second half of the year.
The adjusted gross profit margin reached 27.9 percent in the first half of 2026, an increase compared to the previous year's figure of 25.3 percent. This value is above the company's own expectations and underscores the Instone Group's industry-leading profitability. The quality of the project portfolio and structural competitive advantages, such as economies of scale in purchasing and a high level of vertical integration, contribute significantly to this. For the full year 2026, an adjusted gross profit margin of over 24.0 percent is still forecast, despite accelerated price increases for building materials.
Adjusted operating profit (EBIT) decreased to EUR 15.5 million (H1-2025: EUR 28.9 million) due to the temporarily lower revenue volume and increased platform costs. Adjusted earnings after tax (EAT) reached EUR 1.3 million. This also results from a more negative net financial result, which is particularly related to the scheduled reversal of capitalised interest (H1-2025: EUR 17.2 million). However, the Management Board expects higher results in the coming quarters with increasing sales and construction performance and a consistently high margin level, which should enable the lower end of the profit forecast to be reached.
In the first half of 2026, the Instone Group sold properties worth EUR 114.8 million. This result is above that of the previous year (EUR 96.3 million in H1-2025), regardless of geopolitical burdens and high interest rate volatility. Retail sales increased by 26.0 percent to EUR 114.2 million compared to the previous year. After the outbreak of the Middle East conflict in the first quarter, investor sentiment showed a slight improvement in the second quarter, which manifested itself in a 41.0 percent increase in retail sales compared to the prior-year quarter. Customer interest in individual sales to private investors and owner-occupiers, measured by demand indicators such as reservations, continues to surpass the previous year. However, the Middle East conflict and the associated macroeconomic uncertainty hindered a stronger willingness to conclude deals. The increased time required by banks for credit assessment processes also negatively impacted sales speed. If the crisis situation stabilises, catch-up effects in retail sales are expected in the coming months.
New sales launches in the second half of the year also represent important growth drivers for private individual sales. The new projects are tailored to the attractive funding conditions of the Growth Opportunities Act. They benefit from the increased degressive depreciation of 5.0 percent and an additional linear special depreciation of a further 5.0 percent over four years for energy-efficient properties, which enables attractive after-tax returns for investors. In business with institutional clients, positive demand development was registered, with transactions totalling approximately EUR 150 million being in advanced stages.
