Kojamo Plc Stock Exchange Release, 14 February 2019 at 8:00 a.m. EET

Kojamo plc’s Financial Statements Release 1 January – 31 December 2018

Successful first year as a listed company

This is a summary of the 2018 Financial Statements Release, which is in its entirety attached to this release and can be downloaded from the company’s website at www.kojamo.fi/en .

Unless otherwise stated, the comparison figures in brackets refer to the corresponding period of the previous year. The information in the financial statements release is based on the Kojamo Plc’s audited financial statements for the year 2018. The quarterly figures are unaudited.

Kojamo’s Financial Statements and Board of Directors’ Report as well as Corporate Governance Statement and Remuneration Statement 2018 will be published as a stock exchange release on 14 February, when these documents will be available at the company’s website at www.kojamo.fi/en .

Summary of October–December 2018

  • Total revenue increased by 6.4 per cent to EUR 91.2 (85.7) million
  • Net rental income increased by 6.6 per cent, totalling EUR 60.0 (56.3) million. Net rental income represented 65.8 (65.7) per cent of revenue
  • Profit before taxes was EUR 77.7 (61.3) million. The profit includes EUR 40.0 (25.5) million in net gain on valuation of investment properties at fair value. Earnings per share was EUR 0.25 (0.22)
  • Funds From Operations (FFO) was EUR 34.7 (29.1) million
  • Gross investments totalled EUR 59.4 (173.7) million

Summary of January–December 2018

  • Total revenue increased by 6.5 per cent to EUR 358.8 (337.0) million
  • Net rental income increased by 8.3 per cent, totalling EUR 234.0 (216.0) million. Net rental income represented 65.2 (64.1) per cent of revenue
  • Profit before taxes was EUR 277.3 (266.7) million. The profit includes EUR 127.5 (126.2) million in net gain on valuation of investment properties at fair value and EUR 1.0 (2.5) million profit on sale of investment properties. Earnings per share was EUR 0.93 (0.93).
  • Funds From Operations (FFO) was EUR 116.4 (107.8) million
  • The fair value of investment properties was EUR 5.1 (4.7) billion at the end of the financial year, including EUR 0.0 (3.7) million in investment properties held for sale
  • The financial occupancy rate improved, standing at 97.0 (96.7) per cent during the financial year
  • Gross investments totalled EUR 365.2 (367.3) million, representing 101.8 (109.0) per cent of total revenue
  • Equity per share was EUR 9.54 (8.88) and return on equity was 10.1 (10.9) per cent. Return on investment was 7.2 (7.5) per cent
  • EPRA NAV per share (net asset value) increased by 5.2 per cent to EUR 11.69 (11.11)
  • There were 1,064 (1,525) Lumo apartments under construction at the end of the financial year
  • The Board of Directors’ proposal on dividend: EUR 0.29 per share

Kojamo owned 34,713 (34,383) rental apartments at the end of the financial year. During 2018, 1,049 (75) apartments have been acquired, 1,258 (983) have been completed, 1,908 (1,603) have been sold and 69 (46) have been demolished or altered.

Key figures

  10–12/ 2018 10–12/ 2017 Change % 2018 2017 Change %
Total revenue, M€ 91.2 85.7 6.4 358.8 337.0 6.5
Net rental income, M€ *) 60.0 56.3 6.6 234.0 216.0 8.3
Net rental income margin, % *) 65.8 65.7   65.2 64.1  
Profit before taxes, M€ *) 77.7 61.3 26.8 277.3 266.7 4.0
EBITDA, M€ *) 89.9 72.7 23.7 325.1 308.2 5.5
EBITDA margin, % *) 98.6 84.8   90.6 91.5  
Adjusted EBITDA, M€ *) 49.7 46.2 7.5 196.5 179.5 9.5
Adjusted EBITDA margin, % *) 54.5 54.0   54.8 53.3  
Funds from Operations (FFO), M€ *) 34.7 29.1 19.3 116.4 107.8 8.0
FFO margin, % *) 38.0 33.9   32.4 32.0  
FFO per share, € *) 1) 0.14 0.13 7.7 0.49 0.47 4.3
FFO excluding one-off items, M€ *) 34.7 29.1 19.3 117.3 107.8 8.8
Investment properties, M€ 2)       5,093.2 4,710.2 8.1
Financial occupancy rate, %       97.0 96.7  
Interest-bearing liabilities, M€ 3) *)       2,485.5 2,283.0 8.9
Return on equity, % (ROE) *)       10.1 10.9  
Return on investments, % (ROI) *)       7.2 7.5  
Equity ratio, % *)       43.0 41.3  
Loan to Value (LTV), % 3) *)       45.9 46.0  
EPRA NAV, M€       2,889.1 2,548.8 13.4
EPRA NAV per share, € 1)       11.69 11.11 5.2
Gross investments, M€ *)  59.4 173.7 -65.8 365.2 367.3 -0.6
Number of personnel, end of period       298 316  
Dividend per share, € 1) 4)       0.29 0.22 31.8
  *) In accordance with the guidelines issued by the European Securities and Markets Authority (ESMA), Kojamo provides an account of the Alternative Performance Measures used by the Group in the key figures section of the financial statements release. 1) 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.  
2) Including items held for sale. 3) Excluding items held for sale. 4) 2018: Board of Directors' proposal to the Annual General Meeting.  

Outlook for Kojamo in 2019

Kojamo estimates that in 2019, the Group’s total revenue will increase by 2–7 per cent year-on-year. In addition, the company estimates that the Group’s FFO for 2019 will amount to between EUR 126–141 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

The implementation of our strategy took significant steps forward during the year. Our listing on the Nasdaq Helsinki stock exchange in June was the largest in the Nordics. The offering attracted strong demand and was oversubscribed. We also implemented significant financing arrangements. In March, we issued an unsecured EUR 500 million bond that was listed on the official list of the Irish Stock Exchange. During the year, we improved our performance on all our financial targets.

Our first year as a listed company was successful. The value of our investment properties in-creased by 8 per cent during the year, our net rental income improved by 8 per cent and FFO amounted to EUR 116.4 million. Despite the increased volume of new development completed in the market, we succeeded in increasing our financial occupancy rate to 97.0 per cent. Our custom-er satisfaction was at a good level with an NPS score of 35, while the number of tenancy agree-ments signed via the Lumo webstore had already increased to approximately 8,600 by the end of the year.

During the year, we have successfully developed our investment portfolio, and the fair value of our investment properties amounted to EUR 5.1 billion at the end of the year. We have continued to focus our apartment portfolio on the seven growth centres, supported by the sales and acquisitions carried out during the year. In addition, a total of 1,258 new Lumo apartments were completed last year.

We have also invested especially in our service development during the year. In November, we expanded our existing range of digital services with the introduction of the My Lumo web application that enables Lumo residents to book and buy services and pay their rent also via a mobile device. We are planning to extend the services also to various reservation and home delivery services in the future. My Lumo is part of Kojamo’s innovation and service platform that offers our residents and partners a common platform to pilot and develop housing services.

At the end of the year, we strengthened our Management Team further as we announced the ap-pointment of Tiina Kuusisto as Chief Customer Officer and Ville Rautio as Chief Investment Of-ficer. Following these appointments, we are even better positioned to implement our vision of being the property market frontrunner and the number one choice for our customers.

I want to thank our personnel for their commitment and efforts this past year. We celebrate Kojamo’s 50th anniversary in 2019, and the year will see us accelerating our service development even further, as we strive for delivering the best customer experience in housing.

Jani Nieminen CEO

News conference and webcast

Kojamo will hold a news conference for institutional investors, analysts and media on 14 February 2019 at 10:00 a.m. EET at its headquarters at Mannerheimintie 168A, Helsinki, Finland. The event will be held in English. After the event, the media has a possibility to ask questions in Finnish as well.

The event can be followed as a live webcast. A recording of the webcast will be available later at the company’s website at https://kojamo.fi/en/investors/releases-and-p...l-reports/ . 

The event will be accessible at https://kojamo.videosync.fi/2018-financial-statement  

You can also participate in the news conference by calling:

FI: 09 8171 0310 SE: +46 8566 42651 UK: +44 3333 000 804 US: +1 6319 131 422

The participants joining the news conference will be asked to provide the following PIN code: 50708981#

For more information, please contact

Maija Hongas, Manager, Investor Relations, Kojamo Plc, tel. +358 20 508 3004 Erik Hjelt , CFO, Kojamo plc, +358 20 508 3225

Distribution

Nasdaq Helsinki, Irish Stock Exchange, key media

Kojamo is Finland’s largest private residential real estate company and a frontrunner in the 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 with 50 years of experience. 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 kojamo.fi/en/ 

 

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