Interim report January - September 2015 Continued

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News Desk 2018
Interim report January - September 2015

Continued streamlining toward community service properties JULY-SEPTEMBER 2015 QUARTER • Rental income amounted to MSEK 615 (409) • Profit from property management totaled MSEK 345 (243), corresponding to SEK 2.43 per ordinary share (1.85)* • Profit after tax amounted to MSEK 560 (227), corresponding to SEK 4.06 per ordinary share (1.75 )* • Cash flow from operating activities was MSEK 260 (245), corresponding to SEK 2.14 per ordinary share (1.85)* INTERIM PERIOD JANUARY-SEPTEMBER 2015 • Rental income amounted to MSEK 1,819 (1,190) • Profit from property management totaled MSEK 958 (642), corresponding to SEK 6.81 per ordinary share (5.85)* • Profit after tax amounted to MSEK 1,642 (572), corresponding to SEK 11.93 per ordinary share (5.20)* • Recognized property value of SEK 28.0 billion (17.5) includes 369 (195) directly owned properties • Net asset value (EPRA NAV) per ordinary share was SEK 69.48 (57.55)* • Cash flow from operating activities was MSEK 797 (380), corresponding to SEK 5.59 per ordinary share (3.45)* * Key figures were retroactively restated due to a 2:1 share split implemented in May 2015. SIGNIFICANT EVENTS DURING AND AFTER THE QUARTER • Hemfosa acquired a community service property in Karlstad. The property includes about 7,000 square meters of educational premises and is fully leased with a 20-year agreement. • Hemfosa implemented a private placement of preference shares. Net proceeds of the issue amounted to SEK 166,299,833.70. After the issue, the number of preference shares totaled 10,999,999. • After the end of the quarter, Hemfosa’s partly owned joint venture, Gardermoen Campus Utvikling AS, signed an agreement to develop a local medical center at Gardermoen, near Oslo, adjacent to the specialist hospital the company began building in September 2015. Construction is scheduled to commence in spring 2016, with completion expected in January 2018. • After the end of the quarter, Hemfosa´s partly owned joint venture, Söderport Fastigheter AB, divested eight properties. The total sales price amounted to MSEK 154. Comments from the CEO We continue to strengthen Hemfosa Fastigheter’s position as the largest publicly listed property company with a focus on community service properties. An additional investment in the Oslo area confirms our position as a major player in the Norwegian market. We also analyze the possible acquisition of community service properties in Finland. In the third quarter, our earnings capacity was further strengthened in parallel with lower financing risk due to a lower loan -to-value ratio and a higher quity/assets ratio. INCREASED FOCUS ON COMMUNITY SERVICE PROPERTIES During the year, we have worked determinedly to focus the property portfolio on community service properties, which now account for more than 60 percent of our income – and our aim is to increase that share. Every market condition requires new steps and approaches, having the courage to sit back and wait is sometimes the most opportunistic strategy. The most attractive opportunities for Hemfosa in the current climate are mainly large structural contracts and projects in the public sector in the Nordic region. Our infrastructure projects in Gardermoen are real examples of how we are literally laying the foundation for long-term stable earnings and close relationships with our tenants. BROADER NORDIC PLAYER During the year, we established a clear position as a powerful player in community service properties in Norway and we continue to growth through both acquisitions and more projects. In autumn, our joint venture Gardermoen Campus Utvikling AS (GCU) signed another agreement for a municipal development project in the Oslo region – a local medical center adjacent to the specialist hospital that we started building in September. That GCU was selected as the partner for yet another project in this interesting area confirms that the company is also perceived as a major player in this segment outside of Sweden. We are now hoping to become a broader Nordic player in community service properties by turning our attention towards Finland and actively analyzing potential contracts in the Finnish market for community service properties. Despite some variations in the Swedish, Norwegian and Finnish property markets, there are more factors that unite us in our approach to community service properties, and we see great potential for a powerful and experienced player such as Hemfosa. A DEVELOPING ORGANIZATION Since our foundation, Hemfosa has worked actively and consistently to secure expertise in all parts of this rapidly growing property company. In 2015, Hemfosa strengthened expertise in the Executive Management Team by appointing new employees, for whom we want to present an opportunity to grow and reach their full capacity. This kind of development is natural for our organization and we believe that foresight, openness and real faith in the next generation is the way forward. As part of this process, Stina Lindh Hök, currently the Head of Transactions, will assume Lars Thagesson’s area of responsibility in connection with his transition to a freer role at year-end. Lars Thagesson will also continue to work exclusively with Hemfosa, as a consultant, mainly with responsibility for managing project activities in Norway and probing the Finnish market. We are also proud of our nomination for the 2015 AllBright Award for a company that “promotes a business industry that see the potential in every individual and that recruits based on meritocracy.” In my eyes, a streamlined focus on expertise and results is the only path to lasting business success. The company’s success is proof that this approach pays off, for both employees and investors. With yet another stable quarter behind us, we will continue our journey down this path. During the quarter, a private placement of preference shares also strengthened our financial position. In other words, we are well-equipped, in every possible way, to continue our development of the company. Jens Engwall, CEO For further information, please contact: Jens Engwall, CEO Phone: +46 70 690 65 50, Email: jens.engwall@hemfosa.se Karin Osslind, CFO Phone: +46 70 794 93 37, Email: karin.osslind@hemfosa.se

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