Stock exchange release 24 August 2018 at 8.00 a.m.
Kojamo plc: Kojamo plc's Half Year Financial Report 1 January-30 June 2018
Kojamo had a successful listing, strong operative development and increased investments
This is a summary of Kojamo's January-June 2018 Half Year Financial Report, which is in its entirety attached to this release and can be downloaded from the company's website at www.kojamo.fi/en/investors .
Unless otherwise stated, the comparison figures in brackets refer to the corresponding period of the previous year. The figures in this Half Year Financial Report have not been audited.
Summary of April-June 2018
- Total revenue increased to EUR 89.8 (83.6) million.
- Net rental income increased to EUR 61.4 (55.6) million, representing 68.4 (66.5) per cent of total revenue.
- Profit before taxes increased to EUR 91.5 (80.7) million. The profit includes EUR 53.4 (44.0) million in net valuation gain on fair value assessment.
- The fair value of investment properties was EUR 4.9 (4.4) billion at the end of review period.
- Gross investments totalled EUR 39.5 (64.4) million.
- The share issue in connection with the listing increased the Group's equity by EUR 146.9 million.
Summary of January-June 2018
- Total revenue increased to EUR 178.0 (167.2) million.
- Net rental income totalled EUR 109.5 (101.1) million, representing 61.5 (60.5) per cent of total revenue.
- Profit before taxes increased to EUR 140.5 (132.0) million. The profit includes EUR 74.1 (67.5) million in net valuation gain on the fair value assessment of investment properties and EUR 1.0 (1.3) million profit on sale of investment properties.
- The fair value of investment properties was EUR 4.9 (4.4) billion at the end of review period, including EUR 0.0 (3.9) million in investment properties held for sale.
- The financial occupancy rate remained high, standing at 96.5 (96.6) per cent during the review period.
- Gross investments totalled EUR 243.2 (129.4) million, representing 136.6 (77.4) per cent of revenue.
- Equity per share was EUR 9.11 (8.40) and return on equity was 10.4 (11.1) per cent. Return on investments was 7.3 (7.4) per cent.
- EPRA NAV per share (net asset value) amounted to EUR 11.17 (10.59).
- There were 1,214 (1,835) Lumo apartments under construction at the end of the review period.
Kojamo owned 34,172 (33,877) rental apartments at the end of the period. Since June 2017, 981 apartments have been acquired, 1,360 have been completed, 1,956 have been sold and 90 have been demolished or altered.
Key Figures
| 4-6/2018 | 4-6/2017 | Change% | 1-6/2018 | 1-6/2017 | Change% | 2017 | |
| Total revenue, M€ | 89.8 | 83.6 | 7.3 | 178.0 | 167.2 | 6.4 | 337.0 |
| Net rental income, M€ *) | 61.4 | 55.6 | 10.4 | 109.5 | 101.1 | 8.3 | 216.0 |
| Net rental income margin, % *) | 68.4 | 66.5 | 61.5 | 60.5 | 64.1 | ||
| Profit before taxes, M€ *) | 91.5 | 80.7 | 13.3 | 140.5 | 132.0 | 6.4 | 266.7 |
| EBITDA, M€ *) | 104.4 | 91.0 | 14.7 | 165.0 | 151.8 | 8.7 | 308.2 |
| EBITDA margin, % *) | 116.3 | 108.9 | 92.7 | 90.8 | 91.5 | ||
| Adjusted EBITDA, M€ *) | 50.7 | 46.5 | 8.9 | 90.0 | 83.0 | 8.4 | 179.5 |
| Adjusted EBITDA margin, % *) | 56.4 | 55.6 | 50.6 | 49.7 | 53.3 | ||
| Funds From Operations (FFO), M€ *) | 17.6 | 31.0 | -43.1 | 39.5 | 44.9 | -12.1 | 107.8 |
| FFO margin, % *) | 19.6 | 37.1 | 22.2 | 26.9 | 32.0 | ||
| FFO per share, € *) 4) | 0.08 | 0.14 | -43.9 | 0.17 | 0.20 | -12.7 | 0.47 |
| FFO excluding one-off items, M€ *) | 18.5 | 31.0 | -40.3 | 40.4 | 44.9 | -10.1 | 107.8 |
| Investment properties, M€ 2) | 4,923.3 | 4,423.0 | 11.3 | 4,710.2 | |||
| Financial occupancy rate, % | 96.5 | 96.6 | 96.7 | ||||
| Interest-bearing liabilities, M€ 1) *) | 2,540.3 | 2,460.0 | 3.3 | 2,283.0 | |||
| Return on equity, % (ROE) *) | 10.4 | 11.1 | 10.9 | ||||
| Return on investments, % (ROI) *) | 7.3 | 7.4 | 7.5 | ||||
| Equity ratio, % *) | 41.6 | 38.7 | 41.3 | ||||
| Loan to Value, % 1) *) 3) | 46.7 | 46.1 | 46.0 | ||||
| EPRA NAV, M€ | 2,760.3 | 2,429.2 | 13.6 | 2,548.8 | |||
| EPRA NAV per share, € 4) | 11.17 | 10.59 | 5.5 | 11.11 | |||
| Gross investments, M€ *) | 39.5 | 64.4 | -38.7 | 243.2 | 129.4 | 87.9 | 367.3 |
| Number of personnel, end of period | 347 | 333 | 316 | ||||
| *) Disclosure of Alternative Performance Measurements based on ESMA guidelines is located on key figures section of this Half-Year Report | |||||||
| 1) Excluding items held for sale | |||||||
| 2) Including items held for sale | |||||||
| 3) The formula used in the calculation was changed during year 2017, and comperative figures were adjusted to correspond to the current formula. | |||||||
| 4) Key figures have been adjusted to reflect the impact of the decision by the Extraordinary General Meeting of Shareholders on 25 May, 2018 regarding the share split. In the share split the shareholders received 30 new shares per each existing share. | |||||||
Outlook for Kojamo in 2018 (unchanged)
Kojamo estimates that in 2018, the Group's total revenue will grow by 3 to 9 per cent year-on-year. In addition, the company estimates that the Group's FFO for 2018 will amount to between EUR 103 and EUR 116 million, excluding one-off items. Investments in new development and housing stock acquisitions are forecast to exceed EUR 300 million.
The outlook takes into account the effects of the housing divestments and acquisitions completed in 2018, the estimated occupancy rate and rises in rents, as well as the number of apartments to be completed. The outlook is based on the management's assessment of total revenue, net rental income, administrative expenses, financial expenses, taxes to be paid and new development to be completed, as well as the management's view on future developments in the operating environment.
Additionally, the outlook is based on strong demand sustained by migration, which will increase like-for-like rental income. The management can influence total revenue and FFO through the company's business operations. In contrast, the management has no influence over market trends, the regulatory environment or the competitive landscape.
CEO's review
Kojamo successfully listed on Nasdaq Helsinki during the review period. Demand for the Initial Public Offering was strong, and the IPO was oversubscribed. Trading in Kojamo's shares began on the official list of Nasdaq Helsinki on 19 June 2018. I am very pleased with the great interest investors have shown towards Kojamo's listing.
In March, Kojamo issued an unsecured EUR 500 million bond, listed on the official list of the Irish Stock Exchange. With the bond, the company continued to shift towards unsecured financing.
The company's favourable development continued during the second quarter. We have proceeded with implementing our strategy and succeeded in our operational activities. The financial occupancy rate was on a good level during the review period, despite the increased number of newly constructed properties in the market. The financial occupancy rate in the review period was 96.5 per cent and improved during the second quarter.
During the review period, the number of tenancy agreements signed via the Lumo webstore increased sharply, with over 6,000 agreements signed by the end of June.
During the first quarter of the year, we grew our Lumo business in Finnish growth centres with both newly constructed properties and purchases of existing apartments. We acquired 981 apartments from OP Financial Group's funds. 689 new Lumo apartments were completed during the review period.
Additionally we also sold 1,812 rental apartments as part of the strategy. Out of these, 1,594 apartments were sold to a real estate fund managed by the Morgan Stanley Real Estate Investing, Renger Investment Management, and Premico Group.At the end of the review period, we owned 34,172 apartments.
Acquiring and selling apartments is part of our strategy, according to which we will focus on the seven largest growth centres.
Kojamo plc
Jani Nieminen
CEO
Audiocast 24 August 2018 at 11.00 a.m.
The live audiocast of the Half Year Financial Report is held by Kojamo's CEO Jani Nieminen and CFO Erik Hjelt on 24 August 2018 at 11.00 a.m. Finnish time. The audiocast is held in English.
The audiocast will be available later at the website https://kojamo.fi/en/investors/releases-and-p...l-reports/ .
The audicast can be participated at https://kojamo.videosync.fi/2018-h1-results
It is also possible to participate in the audiocast by phone:
FI: +358 9 8171 0495
UK: +44 20 3194 0552
SE: +46 8 5664 2702
US: +1 855 7161 597
For more information, please contact:
Jani Nieminen, CEO of Kojamo, tel. +358 20 508 3201 Erik Hjelt, CFO of Kojamo, tel. +358 20 508 3225
Kojamo is Finland's largest private residential real estate company and a frontrunner in rental housing business. Our mission is to create better urban housing. We operate in Finland's most significant growth centres and our Lumo brand provides rental housing and new services for urban housing. We actively develop the value and number of our investment properties by developing new properties and our existing property portfolio. We want to be the property market frontrunner and the number one choice for our customers. Kojamo's shares are listed on the official list of Nasdaq Helsinki. For more information, please visit www.kojamo.fi/en/
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