Magnolia Bostad Year-End Report

Transcription

1 Magnolia Bostad Year-End Report Group January December 1

2 October December The quarter in brief Net sales: (39.2) Operating profit: 52.2 (17.2) Profit after tax: 45.0 (16.2) Earnings per share: 1.46 (0.52) Equity (December 31): (190.0) Equity per share: 8.10 (6.07) Significant events during the quarter In October, SEB's property fund, Domestica II, acquired 401 rental apartments from Magnolia Bostad. The deal includes two projects: 133 rental apartments in central Kungsängen and 268 rental apartments in central Norrköping covering a total area of around 24,500 sqm. Construction started on the apartments in December and occupancy is planned for Magnolia Bostad and Helsingborg Municipality are signing a land reservation agreement for the development of 260 rental apartments covering a total area of 13,000 sqm in Mariastaden, Helsingborg. A new local plan for the development of more than 1,550 apartments, with a planned building right of around 95,000 sqm of living space, in the Kungsängen 25:1 property (previously the Slotts mustard factory) in Uppsala has been approved. The construction of apartments in the property is planned to start at the end of 2015/beginning of In November, Magnolia Bostad won a land allocation competition for Östra Sala Backe in Uppsala. The project includes the production of around 100 rental apartments (a total area of around 6,600 sqm) and production will start in Significant events after the quarter Magnolia Bostad strengthens its organization by recruiting twelve employees within the areas of transactions, finance and marketing. In January, an additional 4.5% was acquired in the Kungsängen 25:1 project in Uppsala as well as another 13.0% through a forward contract with possession in 2016 and Fredrik Lidjan assumes the post of President. He is taking over after Andreas Rutili, who has been nominated for election to the Board of Directors at the Annual General Meeting in April. Magnolia Bostad wins another three land allocation competitions: Lundbyvassen in Frihamnen, Gothenburg: production of a hotel covering 12,000 sqm and 150 rental apartments covering 10,500 sqm. Bålsta centrum in Håbo Municipality, in the northern Greater Stockholm region: production of around 200 rental apartments with a total area of around 20,800 sqm. Oceanhamnen in Helsingborg: production of 109 rental apartments with a total area of 8,500 sqm. Key ratios Group Oct Dec Oct Dec Jan Dec Jan Dec Sales Operating profit/loss Operating margin (%) Profit/loss after financial items Net profit/loss for the year Cash flow from operating activities Return on equity (%) Equity/assets ratio (%) Earnings per share (SEK) Number of outstanding shares 31,288,942 31,288,942 31,288,942 31,288,942 Return on capital employed (%) Return on total equity (%) Interest coverage ratio (multiple) Equity per share (SEK)

3 A word from the President Looking back at, we are pleased to report that was a successful year for Magnolia Bostad. The company took strides forward during the year and is progressing in line with our strategy. Net sales for the full year were reported at SEK million (143.6) and operating profit at SEK 47.3 million (23.7). Profit after tax was SEK 29.2 million (20.5). During the year the company added six large housing projects to its project portfolio four through acquisition and two by winning land allocation competitions. These projects include a total of almost 1,300 apartments and have a total area of close to 100,000 sqm. This means that during the year we increased the number of planned apartments in our projects by more than 50% and the total area by 55%. In total, our project stock is now around 4,000 apartments, with occupancy planned up to 2019, and corresponds to around 300,000 sqm in total area. During Magnolia Bostad worked intensely with recruitment, and thanks to these efforts we have been able to recently welcome twelve new employees to the company's new premises on Grev Turegatan in downtown Stockholm. Six of these employees were in the Transactions area, which considerably strengthens our transactions team and opens new opportunities for business. The financial side of the company also received a strong addition with the appointment of Erik Rune as CFO. Our project portfolio is very promising and, together with these strong additions to our team, we are going into the future with a strong base. During 2015 we will start production on a number of projects, and we are also working on completing a number of new rental apartment transactions. Given this background, the coming year looks bright, and we are expecting a strong improvement in profits in After six fantastic years as the President of Magnolia Bostad, I have now decided to leave the operational side of the business. I would therefore like to take this opportunity to thank all of my committed employees within the company, as well as the Board of Directors, for always creating excellent conditions for both me and the organization to continuously expand the operations. I have had the pleasure of working closely with Fredrik Lidjan and I think it is extremely positive that he will now take over as President. With his broad background in real estate and his expertise in running housing development projects, he is the right person to lead Magnolia Bostad forward. As a founder of the company, I am now looking forward to continuing to contribute to the company's development in my role as a member of the Board of Directors. Stockholm, March 2015, Andreas Rutili President Åby Ängar Development of 245 space-efficient rental apartments in Åby Ängar in Vallentuna. Location: Vallentuna Type of ownership: Rental Total area: 13,500 sqm Number of apartments: 245 Architects: ETTELVA Occupancy: 2017/2018 3

4 Market Housing prices in Sweden's major cities continued to increase during the fourth quarter, even if the trend varies between markets. According to an analysis conducted by SBAB, the increased demand and low supply resulted in increasingly shorter sale times and rising prices. According to the same survey, prices are expected to continue to increase during the first quarter of 2015, although at a slightly lower rate. Across the country as a whole, the price of tenant-owner apartments rose by 4 percent during the fourth quarter and the price of single-family homes by 1 percent. In the Greater Stockholm region, the price of tenant-owner apartments increased by 1 percent, and the price of single-family homes by 4 percent. In the Greater Gothenburg region, the price of tenant-owner apartments increased by 1 percent and the price of single-family homes remained unchanged. In Malmö the price of tenant-owner apartments increased by 3 percent and the price of single-family homes by 2 percent, and in Uppsala the price of tenant-owner apartments increased by 1 percent and the price of single-family homes fell by 6 percent. Organizational structure Erik Rune took over as CFO in February. He has considerable experience in the real estate industry. Erik comes most recently from a position as CFO in the Nordic region within CBRE Global Investors. Before that he was the President of the Nordic operations for London & Regional Properties. In March, Fredrik Lidjan took over as President of Magnolia Bostad. He was previously responsible for rental apartment development within the company, and before this he was active in the owner's Board of Directors and the company's investment committee. Fredrik Lidjan's predecessor, Andreas Rutili, will be nominated at the Annual General Meeting in April for election to the Board of Directors. The organization was strengthened with an additional eleven employees in transactions, marketing and sales and finance, including Henrik Meeths (Analysis Manager), Andreas Wallin (Regional Manager South and West Sweden) and Magnus Ericsson (Regional Manager Mid-Sweden). We anticipate that we will continue to recruit new employees in coming quarters. In total, the company's organization currently consists of 30 employees. Publiken 1 Magnolia Bostad is building 268 rental apartments in central Norrköping. The purchaser of the property is SEB's property fund, Domestica II. Location: Norrköping Type of ownership: Rental Total area: 16,600 sqm Number of apartments: 268 Occupancy:

5 Residential projects Property City Type of project Type of ownership Number of housing units Total area (sqm) Phase Estimated completion year Traversen 18 Sollentuna New production Rental ,600 C 2015 Svedje 1:307 and others Åre New production Condominiums 14 1,300 S 2016 Muttern 6 Stockholm Renovation Tenant-owner 56 3,000 CD 2016 Kvarngärdet 28:7 Uppsala New production Tenant-owner 45 3,000 CD 2016 Kungsängens-Tibble 19:1 Kungsängen New production Rental 40 2,350 C 2016 Kungsängens-Tibble 20:2 Kungsängen New production Rental 93 5,500 C 2016 Publiken 1 Norrköping New production Rental ,600 C 2016 Trapphuset 1 Sollentuna New production Tenant-owner 85 6,000 CD 2016 Vallentuna-Åby 1:94 Vallentuna New production Rental 119 6,750 CD 2017 Kungsängen 25:1 1) Uppsala New production Rental 1,150 66,000 CD 2017 Östra Sala Backe, E2, kv 5 Uppsala New production Rental 100 6,600 CD 2017 Slagan 1 Helsingborg New production Rental ,000 CD 2017 Kvarngärdet 28:6 Uppsala New production Tenant-owner 45 3,000 CD 2017 Vallentuna-Åby 1:149 Vallentuna New production Rental 126 6,700 CD 2018 Orminge 52:1 Nacka New production Rental ,000 P 2018 Kungsängen 25:1 1) Uppsala New production Tenant-owner ,000 CD 2018 Sandumseter 2) Norway New production Condominiums ,000 CD 2018 Norefjell 2) Norway New production Condominiums ,000 CD 2018 Part of Gamla Staden 1:1, among others. Helsingborg New production Rental 109 8,500 P 2019 Part of Väppeby 7:7 Bålsta New production Rental ,800 P 2019 Part of Lundbyvassen 736:168 Gothenburg New production Hotel 12,000 P 2019 Part of Lundbyvassen 736:168 Gothenburg New production Rental ,500 P 2019 Skogskarlen 3 3) Solna 8,950 MP Instrumentet 2 3) Stockholm 5,850 MP Kopplingsboxen 26 3) Stockholm 500 MP Total 4, ,500 1) Magnolia Bostad's share totals 67.3%. Partitioned off in accordance with the local plan. 2) Magnolia Bostad's share totals 16%. 3) Management property. The area refers to lettable area. P Planning work CD Concept development S Sales C Construction MP Management Property 5

6 Financial performance Profit/loss for Q4 Consolidated net sales for Q4 totaled SEK million (39.2). Sales for the quarter were impacted by the sales in Norrköping and Kungsängen. Operating profit/loss was SEK 52.2 million (17.2) and was primarily burdened by operating costs and other operating expenses. The operating margin was 40.7 percent (44.0). Net financial items were SEK 6.5 million ( 1.0), and the change is due to the higher interest expenses attributable to an increase in bank funding in conjunction with investments in new projects and the bond that was issued during the year. Profit before tax was SEK 45.7 million (16.2). Profit/loss for the period January-December Net sales were SEK million (143.6). Operating profit was SEK 47.3 million (23.7) and the operating margin was 33.7 percent (16.5). Net financial items were SEK 17.5 million ( 3.2). Profit after tax was SEK 29.2 million (20.5). Balance sheet as at December 31, The balance sheet total at the end of the fourth quarter was SEK million (369.7), which is an increase of SEK million compared to December 31,. The strong increase is mainly due to the acquisition of the Skogskarlen 3 property in Bergshamra and the issued bond loan. Equity in increased to SEK million (190.0), which had an effect of SEK 39.0 million using the equity method applied in the associated company, Moutarde Holding AB. Equity/assets ratio decreased to 32.0 percent (51.4). Balance sheet total and equity (SEK thousand) Cash flow and financing Consolidated available liquidity at the end of the period was SEK 37.4 million (23.3). Cash flow from operating activities in the fourth quarter totaled SEK 86.1 million ( 47.6). During the quarter, cash flow from investing activities totaled SEK 1.1 million ( 6.4). Financing activities were primarily impacted by changes to loans and dividends, and totaled SEK 37.7 million (71.3). Cash flow from operating activities for the period January-December totaled SEK million ( 46.6). The considerable increase in working capital is attributable to the balance sheet item, sales properties, which increased following the acquisition of Skogskarlen 3, and investments in existing project properties. Cash flow from financing activities was impacted by the company's increase in funding in conjunction with new investments, the bond that was issued during the year and dividends to shareholders. The total interest-bearing borrowings amounted to SEK million (152.1) on December 31. Stock F. Holmström Fastigheter AB, in which Fredrik Holmström has a controlling interest through companies, holds a 78.0 percent interest in Magnolia Bostad. As of December 31,, the company had issued 31,288,942 shares to 21 stockholders. The stock is not traded on an active market. Accounting and measurement principles The company applies the Swedish Accounting Standards Board's general guidelines and statements. In situations where there are no general guidelines from the Swedish Accounting Standards Board, recommendations from the Swedish Financial Accounting Standards Council have been applied. The accounting and measurement principles are in agreement with those applied in the Annual Report and which are reported there under Note 1 on pages Key ratio definitions agree with those applied in the Annual Report and can be found there on page This report has not been audited by the company's auditors. Balance sheet total Equity 6

7 Consolidated income statement SEK thousand Oct Dec Oct Dec Jan Dec Jan Dec Operating income Net sales 128,108 39, , ,576 Total income 128,108 39, , ,576 Operating expenses Production and operating costs 71,679 17,356 75, ,631 Other external costs 3,962 2,787 9,679 7,740 Personnel costs 1,215 1,678 5,560 5,541 Depreciation, amortization and impairment of property, plant and equipment and intangible assets , Profit/loss from participations in associated companies 1,152 1,152 Operating profit/loss 52,157 17,239 47,332 23,710 Profit/loss from financial items Interest income and similar profit/loss items 375 1,254 3,412 3,062 Interest expenses and similar profit/loss items 6,874 2,251 20,940 6,262 Profit/loss before tax 45,658 16,242 29,804 20,510 Tax on profit/loss for the year NET PROFIT/LOSS FOR THE YEAR 45,050 16,250 29,196 20,518 7

8 Consolidated balance sheet SEK thousand 12/31/ 12/31/ ASSETS Non-current assets Intangible assets Goodwill 5,946 7,146 Other intangible assets 8, Total intangible assets 14,249 7,460 Property, plant and equipment Equipment, tools, fixtures and fittings Total property, plant and equipment Financial assets Participations in associated companies 39,832 4,525 Receivables from associated companies 23,541 26,541 Other securities held as non-current assets 30,614 30,614 Other long-term receivables 24,201 14,950 Total financial assets 118,188 76,630 Total non-current assets 132,636 84,307 Current assets Inventories, etc. Property held for resale 424, ,608 Total inventories, etc. 424, ,608 Current receivables Accounts receivable 1,057 1,507 Receivables from associated companies 9,598 46,973 Other receivables 186,952 3,714 Prepaid expenses and accrued income Total current receivables 198,123 52,525 Cash and bank balances 37,399 23,256 Total current assets 659, ,389 TOTAL ASSETS 792, ,696 8

9 Consolidated balance sheet (cont'd) SEK thousand 12/31/ 12/31/ EQUITY AND LIABILITIES Equity Share capital 125, ,156 Equity method reserve 38,068 Other capital 60,997 44,389 Net profit/loss for the year 29,196 20,518 Total equity 253, ,063 Provisions Provision for deferred taxes 169 Total provisions 169 Liabilities Long-term liabilities Liabilities to credit institutions 494, ,130 Other long-term liabilities 100 4,000 Total long-term liabilities 494, ,130 Current liabilities Liabilities to credit institutions 12,000 2,000 Accounts payable 15,131 6,465 Liabilities to the parent company 12,311 Liabilities to associated companies 3,904 Income tax liabilities 1, Other current liabilities 5,336 1,062 Accrued expenses and deferred income 10,746 3,747 Total current liabilities 44,350 29,503 Total liabilities 538, ,633 TOTAL EQUITY AND LIABILITIES 792, ,696 9

10 Consolidated cash flow statement SEK thousand Oct Dec Oct Dec Jan Dec Jan Dec Operating activities Profit/loss after financial items 45,658 16,242 29,804 20,510 Adjustments for non-cash items, etc. 1,191 20,406 4,407 30,636 Income tax paid 3, , Cash flow from operating activities before changes in working capital 47,929 4,173 37,846 10,170 Cash flow from changes in working capital Decrease(+)/increase(-) in property held for resale 40,223 32,542 68,335 36,748 Decrease(+)/increase(-) in current receivables 198,912 26, ,373 1,754 Decrease(+)/increase(-) in current liabilities 24,619 15,413 4,750 2,088 Cash flow from operating activities 86,141 47, ,111 46,584 Investing activities Acquisition of intangible fixed assets 2 8, Acquisition of property, plant and equipment Investment in financial assets 1,238 6,875 6,660 21,975 Disposal/reduction of financial assets Cash flow from investing activities 1,139 6,375 14,831 21,552 Financing activities Shareholders contributions received Borrowings 47,776 73, ,704 77,324 Repayment of borrowings 10,137 2, ,666 5,897 Paid dividends 5,006 Cash flow from financing activities 37,692 71, ,085 71,482 Cash flow for the year 49,588 17,374 14,143 3,346 Cash and cash equivalents at the beginning of the year 86,987 5,882 23,256 19,910 Cash and cash equivalents at the end of the year 37,399 23,256 37,399 23,256 10

11 Change in equity SEK thousand Share capital Equity method reserve Other equity Net profit/ loss for the year Amount at beginning of the year 125,156 44,389 20,518 Profit carried forward 20,518 20,518 Write-up 39,000 Shareholders' contributions 164 1) Dividends 5,006 Change in equity method reserve Net profit/loss for the year 29,196 Amount at the end of the period 125,156 38,068 60,997 29,196 c1) Warrants 11

12 Financial calendar Annual General Meeting: April 22, 2015 Report January-March: May 11, 2015 Report January-June: August 17, 2015 Report January-September: November 9, 2015 Report January-December: February 26, 2016 Contact Magnolia Bostad AB Grev Turegatan 11 A Box 5853 SE Stockholm Sweden Phone: [email protected] For additional information, please contact: Fredrik Lidjan, President [email protected]