Kojamo plc Half-Year Financial Report 1 January–30 June 2024
15/08/2024 06:00
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Kojamo plc Stock Exchange Release, 15 August 2024 at 8.00 a.m. EEST
Kojamo plc Half-Year Financial Report 1 January–30 June 2024
Total revenue and net rental income increased, renting was impacted by the
continued abundant supply on the market
This is a summary of the January–June 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/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 2024
* Total revenue increased by 3.1 per cent to EUR 112.3 (108.9) million
* Net rental income increased by 3.9 per cent totalling EUR 82.1 (79.0)
million. Net rental income represented 73.1 (72.6) per cent of total revenue
* Result before taxes was EUR -104.3 (71.7) million. The result includes EUR
-149.9 (14.0) million net result on the valuation of investment properties at
fair value. Earnings per share was EUR -0.34 (0.23)
* Funds From Operations (FFO) decreased by 17.4 per cent and amounted to EUR
42.7 (51.7) million
* Gross investments totalled EUR 10.9 (61.3) million, representing 9.7 (56.3)
per cent of total revenue
Summary of January–June 2024
* Total revenue increased by 3.9 per cent to EUR 225.6 (217.1) million.
* Net rental income increased by 3.0 per cent to EUR 142.7 (138.5) million.
Net rental income was 63.3 (63.8) per cent of total revenue.
* Result before taxes was EUR -65.0 (95.7) million. The result includes EUR
-138.8 (5.1) million net result on the valuation of investment properties at
fair value and EUR -0.8 (-0.1) million in profit/loss from the sale of
investment properties. Earnings per share was EUR -0.21 (0.31).
* Funds From Operations (FFO) decreased by 15.3 per cent to EUR 68.2 (80.5)
million.
* The fair value of investment properties was EUR 7.9 (8.3) billion at the end
of the review period, including EUR 1.3 (0.0) million in Investment properties
held for sale.
* The financial occupancy rate was 91.7 (92.2) per cent for the review period.
* Gross investments amounted to EUR 19.3 (116.3) million, representing 8.6
(53.5) per cent of total revenue.
* Equity per share was EUR 14.50 (15.46), and return on equity was -2.9 (4.0)
per cent. Return on investment was -0.2 (3.6) per cent.
* EPRA NRV (Net Reinstatement Value) per share fell by 6.9 per cent to EUR
18.16 (19.50).
* There were 0 (1,152) Lumo apartments under construction at the end of the
review period.
Kojamo owned 40,973 (39,819) rental apartments at the end of the review
period. Since June of last year, Kojamo has completed 1,152 (1,216)
apartments, sold 0 (73) and demolished or otherwise altered 2 (9) apartments.
Key figures
4–6/2024 4–6/2023 Change % 1–6/2024 1–6/2023 Change % 2023
Total revenue, M€ 112.3 108.9 3.1 225.6 217.1 3.9 442.2
Net rental income, M€ * 82.1 79.0 3.9 142.7 138.5 3.0 297.2
Net rental income margin, % * 73.1 72.6 63.3 63.8 67.2
Profit/loss before taxes, M€ * -104.3 71.7 -245.5 -65.0 95.7 -167.9 -112.3
EBITDA, M€ * -78.0 82.0 -195.1 -15.9 122.9 -112.9 -39.9
EBITDA margin, % * -69.4 75.3 -7.1 56.6 -9.0
Adjusted EBITDA, M€ * 71.9 68.0 5.7 123.8 118.0 4.9 255.1
Adjusted EBITDA margin, % * 64.0 62.5 54.9 54.3 57.7
Funds From Operations (FFO), M€ * 42.7 51.7 -17.4 68.2 80.5 -15.3 167.2
FFO margin, % * 38.0 47.5 30.2 37.1 37.8
FFO excluding non-recurring costs, M€ * 42.7 51.7 -17.4 68.2 80.5 -15.3 167.2
Investment properties, M€ ¹⁾ 7,922.6 8,268.1 -4.2 8,038.8
Financial occupancy rate, % 91.7 92.2 93.0
Interest-bearing liabilities, M€ * 3,861.4 3,658.8 5.5 3,600.4
Return on equity (ROE), % * -2.9 4.0 -2.4
Return on investment (ROI), % * -0.2 3.6 -0.4
Equity ratio, % * 43.0 45.3 44.5
Loan to Value (LTV), % *²⁾ 45.0 43.8 44.6
EPRA Net Reinstatement Value (NRV), M€ 4,487.0 4,819.9 -6.9 4,558.8
Gross investments, M€ * 10.9 61.3 -82.2 19.3 116.3 -83.4 190.7
Number of personnel, end of the period 299 344 288
Key figures per share, € 4–6/2024 4–6/2023 Change % 1–6/2024 1–6/2023 Change % 2023
FFO per share * 0.17 0.21 -19.1 0.28 0.33 -15.2 0.68
Earnings per share -0.34 0.23 -247.8 -0.21 0.31 -167.7 -0.36
EPRA NRV per share 18.16 19.50 -6.9 18.45
Equity per share 14.50 15.46 -6.2 14.67
* 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, the formulas used in their calculation, and reconciliation calculations in accordance with ESMA guidelines section of the Half-Year Financial Report
¹⁾ Including Non-current assets held for sale
²⁾ Excluding Non-current assets held for sale
Outlook for Kojamo in 2024
Kojamo reiterates its outlook issued on July 15, 2024, in which Kojamo
estimates that in 2024, the Group’s total revenue will increase by 2–4 per
cent (previously 4–7 per cent) year-on-year. In addition, Kojamo estimates
that the Group’s FFO for 2024 will amount to between EUR 142–152 million,
excluding non-recurring costs (previously EUR 152–164 million).
The outlook is based on the management’s assessment of total revenue,
property maintenance expenses and repairs, administrative expenses, financial
expenses and taxes to be paid as well as the management’s view on future
developments in the operating environment.
The outlook takes into account the estimated occupancy rate and rises in
rents. The outlook does not take into account the impact of potential
acquisitions or disposals on total revenue and FFO.
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
Total revenue and net rental income grew in the first half of the year. FFO
decreased compared to the comparison period due to an increase in financial
and maintenance expenses. Our financial key figures and liquidity situation
have remained good.
The market situation was reflected in a decrease in our occupancy rate and
affected the rent increases. The supply of apartments remains plentiful, and
the competition for good residents has been intense. A number of previously
started projects were completed, and in addition, unsold new owner-occupied
housing has been moved into the rental market, delaying the correction of the
supply situation. Although urbanisation continued to be strong, the oversupply
situation did not start to dissipate yet in the spring.
The number of residential start-ups has been very low for a long time, and the
number of granted building permits has declined further from the previous
year. There is no clear sign of construction activity picking up, which is why
the number of market-based apartments to be completed in the next couple of
years will be very limited. At the same time, urbanisation is progressing.
Population growth has remained strong in Helsinki, Tampere and Turku regions
due to internal migration and immigration. These factors are still expected to
balance the demand and supply of rental apartments and to lead to a reduction
in the supply of rental apartments in the market. Our renting in July and at
the beginning of August has been supportive for the guidance.
At the beginning of the year, few significant residential real estate
transactions were made in Finland. However, in the second quarter, we
increased the yield requirements for investment properties to reflect the
completed transactions. The decrease in interest rates reduces the pressure to
change yield requirements in the near future.
The saving programme launched last autumn has progressed according to the
plan. Our goal is to maintain the company's strong financial position and
adapt our operations to the challenges brought by the uncertainty in the real
estate market and the higher interest rate environment. Investments this year
will be exceptionally low. No new modernisation investments have been started,
and we have reduced repairs other than those supporting renting of apartments.
The personnel layoffs are still in effect, and in addition, we have brought
efficiency to our operations by renewing our organisation. The savings in
administrative and marketing expenses have been significant. Also, the
decision made in the spring not to pay the dividend will help to keep the
capital structure strong.
The last apartments under construction were completed at the end of June. We
have a binding preliminary agreement for only one property. The situation is
entirely exceptional in the company's history. In the short term, we focus on
managing the existing housing portfolio and are not currently planning any new
investments. In this way, we want to ensure that our financial situation will
remain strong, our existing business will strengthen, and the goals of the
saving programme will be achieved.
Positive signs in the operating environment are visible. Inflation has slowed
down, and the decline in market interest rates seems to have started, although
a rapid decrease in interest rates has not occurred. Due to the successful
financing arrangements made in the early part of the year, our financial
position is solid, which allows us to patiently await improvements in market
conditions.
Jani Nieminen
CEO
News conference as a webcast
Kojamo will hold a news conference for institutional investors, analysts and
media on 15 August 2024 at 10.00 a.m. EEST at the company’s head office at
Mannerheimintie 168A, Helsinki. The event will be held in English. After the
event, the media has a possibility to ask questions also in Finnish.
The event can also be followed as a live webcast through which it is possible
to ask questions. No registration for the webcast in advance is needed. The
event will be accessible at https://kojamo.videosync.fi/q2-2024.
A recording of the webcast will be available later at the company’s website
at
https://kojamo.fi/en/investors/releases-and-publications/financial-reports/.
For more information, please contact:
Niina Saarto, Director, Treasury & Investor Relations, Kojamo plc, tel. +358
20 508 3283, niina.saarto@kojamo.fi
Erik Hjelt, CFO, Kojamo plc, tel. +358 20 508 3225, erik.hjelt@kojamo.fi
Distribution:
Nasdaq Helsinki, Irish Stock Exchange, key media
Kojamo is Finland’s largest private residential real estate company and one
of the biggest investors in Finland. Our mission is to create better urban
housing. Lumo offers environmentally friendly housing and services for the
city dweller who appreciates quality and effortlessness. We actively develop
the value 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
https://kojamo.fi/en/
Attachments
* Kojamo Half-Year Financial Report 1 January - 30 June 2024
(https://ml-eu.globenewswire.com/Resource/Download/3b3ad50d-2f2c-4531-a2ec-215da0c17019)
* Kojamo Half-Year Financial Report 1 January - 30 June 2024 presentation
(https://ml-eu.globenewswire.com/Resource/Download/e88bd1b6-39ab-4f79-8c8d-bded425dcdae)