Property group Corem cuts dividend as interest coverage ratio falls (updated)

Corem Property AB

21/02/2024 07:51

(Adds background from paragraph 2, CEO quote in paragraph 4)
       Feb 21 (Reuters) - Swedish property group Corem
 COREa.ST  on Wednesday said its interest coverage ratio had
deteriorated further in the fourth quarter of last year, and
proposed to slash its dividend by 75%.
    Corem has been hit by a property market crisis in Sweden, as
high interest rates, inflation and slowing demand have left a
number of real estate firms struggling with debts they took on
when interest rates were low. 
    With bonds maturing this year worth some 5.5 billion Swedish
crowns ($531.48 million), Corem has recently divested several
properties, while two planned deals worth about 7 billion crowns
fell through in December. 
    "Our entire focus, for now and going forward, is to trim and
optimise the business and thus to improve the property portfolio
occupancy rate and operating margin," CEO Rutger Arnhult said in
a statement. 
    Corem's interest coverage ratio, which reflects a company's
ability to pay the interest on its outstanding debt, fell to 1.7
in the fourth quarter from 2.0 a year earlier.
    For the full year, the ratio fell to 1.9 from 2.5.
    It proposed a dividend of 0.10 crowns per A and B share,
down from 0.40 crowns last year. 
        ($1 = 10.3485 Swedish crowns)

 (Reporting by Greta Rosen Fondahn; editing by Milla Nissi and
Jason Neely)
 ((Greta.RosenFondahn@thomsonreuters.com))