Kojamo plc Interim Report 1 January–30 September 2024
07/11/2024 06:00
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Kojamo plc Stock Exchange Release, 7 November 2024 at 8.00 a.m. EET
Kojamo plc Interim Report 1 January–30 September 2024
Total revenue and net rental income increased, the fair value of investment
properties remained unchanged
This is a summary of the January–September Interim 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 Interim Report
have not been audited.
Summary of July–September 2024
* Total revenue increased by 1.5 per cent to EUR 113.2 (111.5) million
* Net rental income increased by 3.1 per cent totalling EUR 85.7 (83.1)
million. Net rental income represented 75.8 (74.6) per cent of total revenue
* Result before taxes was EUR 50.6 (-88.5) million. The result includes EUR
0.9 (-141.8) million net result on the valuation of investment properties at
fair value. Earnings per share was EUR 0.16 (-0.29)
* Funds From Operations (FFO) decreased by 5.9 per cent and amounted to EUR
45.6 (48.5) million
* Gross investments totalled EUR 2.2 (45.0) million, representing 2.0 (40.3)
per cent of total revenue
Summary of January–September 2024
* Total revenue increased by 3.1 per cent to EUR 338.8 (328.6) million
* Net rental income increased by 3.1 per cent to EUR 228.4 (221.6) million.
Net rental income was 67.4 (67.4) per cent of total revenue
* Result before taxes was EUR -14.3 (7.2) million. The result includes EUR
-137.9 (-136.7) 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 -0.05 (0.02)
* Funds From Operations (FFO) decreased by 11.8 per cent to EUR 113.8 (128.9)
million
* The fair value of investment properties was EUR 7.9 (8.2) 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 91.5 (92.7) per cent for the review period
* Gross investments amounted to EUR 21.6 (161.3) million, representing 6.4
(49.1) per cent of total revenue
* Equity per share was EUR 14.56 (15.18), and return on equity was -0.4 (0.2)
per cent. Return on investment was 1.3 (1.2) per cent
* EPRA NRV (Net Reinstatement Value) per share fell by 4.0 per cent to EUR
18.34 (19.11)
* There were no Lumo apartments under construction at the end of the review
period. In the comparison period, 779 Lumo apartments were under construction
Kojamo owned 40,973 (40,192) rental apartments at the end of the review
period. Since September of last year, Kojamo has completed 779 (1,273)
apartments, sold 0 (73) and demolished or otherwise altered 2 (9) apartments.
Key figures
7–9/2024 7–9/2023 Change % 1–9/2024 1–9/2023 Change % 2023
Total revenue, M€ 113.2 111.5 1.5 338.8 328.6 3.1 442.2
Net rental income, M€ * 85.7 83.1 3.1 228.4 221.6 3.1 297.2
Net rental income margin, % * 75.8 74.6 67.4 67.4 67.2
Profit/loss before taxes, M€ * 50.6 -88.5 157.2 -14.3 7.2 -299.1 -112.3
EBITDA, M€ * 78.9 -67.9 216.1 63.0 55.0 14.5 -39.9
EBITDA margin, % * 69.7 -60.9 18.6 16.7 -9.0
Adjusted EBITDA, M€ * 77.9 73.8 5.6 201.7 191.8 5.2 255.1
Adjusted EBITDA margin, % * 68.9 66.2 59.6 58.4 57.7
Funds From Operations (FFO), M€ * 45.6 48.5 -5.9 113.8 128.9 -11.8 167.2
FFO margin, % * 40.3 43.5 33.6 39.2 37.8
FFO excluding non-recurring costs, M€ * 45.6 48.5 -5.9 113.8 128.9 -11.8 167.2
Investment properties, M€ ¹⁾ 7,925.9 8,171.4 -3.0 8,038.8
Financial occupancy rate, % 91.5 92.7 93.0
Interest-bearing liabilities, M€ * 3,860.7 3,650.3 5.8 3,600.4
Return on equity (ROE), % * -0.4 0.2 -2.4
Return on investment (ROI), % * 1.3 1.2 -0.4
Equity ratio, % * 43.1 45.0 44.5
Loan to Value (LTV), % *²⁾ 44.7 44.3 44.6
EPRA Net Reinstatement Value (NRV), M€ 4,531.5 4,722.9 -4.1 4,558.8
Gross investments, M€ * 2.2 45.0 -95.1 21.6 161.3 -86.6 190.7
Number of personnel, end of the period 260 311 288
Key figures per share, € 7–9/2024 7–9/2023 Change % 1–9/2024 1–9/2023 Change % 2023
FFO per share * 0.18 0.20 -10.0 0.46 0.52 -11.5 0.68
Earnings per share 0.16 -0.29 155.2 -0.05 0.02 -350.0 -0.36
EPRA NRV per share 18.34 19.11 -4.0 18.45
Equity per share 14.56 15.18 -4.1 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 Interim Report
¹⁾ Including Non-current assets held for sale
²⁾ Excluding Non-current assets held for sale
Outlook for Kojamo in 2024 unchanged
Kojamo estimates that in 2024, the Group’s total revenue will increase by
2–4 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.
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
Growth in total revenue and net rental income continued in the third quarter
of the year. FFO decreased compared to the previous year, which was due to
increased financial and maintenance expenses. Our balance sheet has remained
strong, and our liquidity situation is good.
Due to the completion of previously started projects, there is still
oversupply in the rental market. The competition for residents has remained
intense, although the supply of apartments has turned to a decline.
The number of residential start-ups has remained at a very low level, and no
clear sign of construction recovering is visible. In the next couple of years,
the number of completed market-based apartments will be very low, and this is
expected to reduce the oversupply. Population growth has been rapid in the
Helsinki, Tampere and Turku regions due to internal migration and immigration.
Population growth is expected to continue strong in big cities.
Our cumulative occupancy rate decreased, but our occupancy rate in the third
quarter nevertheless improved compared to the second quarter of the year.
Although the dissipation of the oversupply has been delayed, limited
construction and strongly increasing population in growth centres is expected
to balance the market in the longer term.
At the end of the review period, we did not have any apartments under
construction, and for the time being, we refrain from making new investment
decisions. However, we will start the construction of a project at the end of
this year, which is based on a previously signed binding preliminary
agreement. In Helsinki, 119 apartments will be completed in the beginning of
2026.
Administrative and marketing expenses as well as repair expenses decreased
significantly during the review period. During the first nine months, expenses
were a total of EUR 8.8 million lower than in the previous year. The cost
savings will continue during the end of the year.
Our financial situation has remained stable. At the beginning of the year, we
refinanced our loans that are due next year. Our next financing need is for
loans maturing in 2026. Interest rates have turned to a decline, and the
market expects central banks to continue rate cuts next year as well, which
will have a positive effect on the price of future financing arrangements. In
the autumn, Moody's confirmed Kojamo's previous Baa2 (negative) credit rating.
It is important for us to maintain the investment grade credit rating also in
the future.
Our housing brand, Lumo, was launched ten years ago. It was established with
the desire to offer modern services for rental living. From the beginning, the
goal has been to make living easy and effortless and to give customers more
freedom of choice. Shortly after the launch, we opened the Lumo webstore,
which renewed the way to rent an apartment. In ten years, the importance of
services has become even more pronounced. We want to be the number one choice
for our customers in the future as well. Thus, our work with better and more
responsible urban living goes on.
During the year, we have enhanced our operations in order to address the
challenges of the operating environment. Although the challenges persist,
there are positive signs in the rental and financing markets. With our active
efforts, we have achieved necessary changes. I thank the personnel for the
determined development of Kojamo.
Erik Hjelt
Interim CEO
News conference as a webcast
Kojamo will hold a news conference for institutional investors, analysts and
media on 7 November 2024 at 10.00 a.m. EET 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/q3-2024.
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, Interim CEO, 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 Interim Report 1 January - 30 September 2024 - presentation
(https://ml-eu.globenewswire.com/Resource/Download/cda3649a-8821-4ff4-a02d-9cf70c5f0c32)
* Kojamo Interim Report 1 January - 30 September 2024
(https://ml-eu.globenewswire.com/Resource/Download/5525fa3a-497a-46ca-88ff-1f7a99bdf73d)