Interim Report January – March 2017
• Rental income amounted to MSEK 722 (650)
• Profit from property management totaled MSEK 447 (340), corresponding to SEK 2.66 per ordinary share (2.31)
• Profit after tax amounted to MSEK 986 (654), corresponding to SEK 6.02 per ordinary share (4.59)
SIGNIFICANT EVENTS DURING AND AFTER THE PERIOD
• In March, Hemfosa entered into a conditional agreement to wholly own the specialist hospital and a local medical center at Gardermoen, which Hemfosa of today is co-owner of in a joint venture
• Hemfosa issued bonds in an amount of MSEK 750
• Hemfosa’s joint venture Söderport Holding AB invested MSEK 352 and divested for MSEK 979
COMMENTS FROM THE CEO
Stronger financial flexibility
We entered 2017 with strong performance in the first quarter, with increases in both net operating income and profit from property management. With favorable value growth in both Sweden and Norway, we achieved an EPRA/NAV that reflects a very strong trend in Hemfosa’s long-term net asset value.
In terms of activity, the quarter was relatively calm, with a somewhat cautious market in Sweden, which I believe is due to uncertainty concerning the ongoing tax inquiry put forward to the Swedish government in March, and the consequences this could have. Hemfosa closely monitors the development and examines the effects it could have on our operations.
We still implemented a number of individual acquisitions and sales in line with our strategy of streamlining the portfolio towards community service properties and we see potential for further interesting transactions in Sweden moving forward. We also took an additional grip on the market in Norway where we are constructing a specialist hospital and a local medical center in the joint venture Gardermoen Campus Utvikling AS (GCU). Now we have signed a conditional agreement on full ownership of these buildings when they are completed in 2018. We see other interesting opportunities in the Gardermoen campus which we continue to plan and develop together with the property development company Aspelin Ramm Eiendom AS.
In Finland, Hemfosa is still something of a rookie and there, now with proprietary personnel in place, we are focusing on analyzing and identifying solid acquisitions of community service properties.
Overall, we see interesting openings in all three of our markets.
We will now continue to work methodically and intensively to find and implement the right transactions for Hemfosa, of both individual properties and larger portfolios, at the same time as investing in developing and adding value to our existing property portfolio.
Financially, I believe that a number of winds are blowing in the right direction from Hemfosa’s viewpoint. A slightly tougher interest-rate environment is creating interesting opportunities for us and access to capital/financing has improved. Our latest issue of bonds in an amount of MSEK 750 was oversubscribed in December at a lower cost, which I view as evidence that confidence in Hemfosa is rock solid. We also see considerable demand in the commercial paper market at favorable prices. Applying for mandate to implement a new issue of shares while simultaneously proposing that the AGM grant us the possibility to buy back own shares may seem contradictory, but this is an additional way for us to ensure flexibility so that over time we have the optimal capital structure and can also act correctly in various future scenarios. We want as much financial latitude as possible to continue to grow, preferably by taking both small steps and large strides.
Jens Engwall, CEO
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This information is inside information that Hemfosa Fastigheter AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out belove, at 7.30 CET on April 25, 2017.