Technopolis Group 2008 Review
Technopolis Group OULU KUOPIO JYVÄSKYLÄ LAPPEENRANTA TAMPERE PIETARI Capital Area Specializing in business environments for high-tech companies The biggest STP chain in Europe A profitable growth company A unique concept
The Technopolis Concept
The Technopolis STP Network 1 200 customers employing roughly 16 000 people 15 science and technology parks (STPs) operating as a chain 481 000 m 2 of space in use and under construction High-quality business environments from 10 m 2 to 40 000 m 2
Breakdown of Properties by Region 5 % 1 % 9 % 4 % 8 % 32 % 11 % 37 % Oulu Capital city area 9 % Jyväskylä Kuopio Tampere Lappeenranta 10 % 11 % St. Petersburg 13 % 27 % 23 % 2008 2010 Fair market value of investment property 31.12.2008 MEUR 620 Est. fair market value of investment property 31.12.2010 MEUR 750
Largest Customers Customer ARK Therapeutics Oy Aspocomp Oulu Oy Digia Oyj Fazer Amica Oy Honeywell Oy Inion Oy Jyväskylä University Kemira Oyj Kuopion University Logica Suomi Oy Customer Metso Paper Oy NetHawk Oy Nokia Oyj PKC Group Oyj Pöyry konserni SWECO Industry Oy TKK (Helsinki University of Technology) TeliaSonera Finland Oyj TietoEnator Corporation VTT - As of 31.12.2008 the 20 largest customers were renting 46 % of the company s space. - No single company generates more than 9,3 % of the company s rental revenue.
Largest Investments Project City Year m 2 MEUR Investment Technopolis Kuopio Oy acquisition Kuopio 2008 47 800 67,3 Hermia 12 completed Tampere 2008 5 092 9,2 Vapaudenaukio Phase 1 completed Lappeenranta 2008 3 149 5,9 Helsinki-Vantaa Phase 5 completed Vantaa 2008 5 107 13,3 Ruoholahti Phase 1 completed Helsinki 2008 6 600 18,7 Kontinkangas Phase 3 & 4 completed Oulu 2008 6 993 12,4 Kontinkangas Phase 5 under construction Oulu 2009 3 504 7,2 Hermia 15, Phase 1 under construction Tampere 2009 4 910 14,5 Ohjelmakaari Phase 2 under construction Jyväskylä 2009 3 780 7,7 Yliopistonrinne Phase 1 under construction Tampere 2010 11 700 33,3 St. Pete, Pulkovo Phase 1 under construction Russia 2010 19 000 50,0 Total 117 635 239,5
Highlights 2008
State of the Art Video Conferencing First TELEPRESENCE conference rooms available to the public in the Nordic countries now in Espoo and Oulu Flexible video conferencing in every Technopolis unit: Helsinki, Espoo, Vantaa, Oulu, Tampere, Lappeenranta, Jyväskylä, Kuopio and St. Petersburg Efficient decision making, time and cost savings Supports green values Our partners are Tandberg and Visual Conference Group
Business Development Services Technopolis Ventures Serves More Than Half of New Finnish High Tech High Growth Start-ups Start-Up Operations* 2004 2005 2006 2007 2008 Class-A start-ups 9 19 36 52 65 Risk investments for clients (deals) 14 22 25 20 41 Risk financing for clients (MEUR) NA NA 12 15 53 Early stage Risk financing deals avg. (MEUR) NA NA 0.48 0.7 1.29 * 2004-2007 pro forma, Tampere and Kuopio from 2007
Technopolis Clients are Winners Formed in 1993, Red Herring is a primary instrument among Technology industry executives and investors to discover promising start-ups globally Past winners include Google, Yahoo!, Skype, YouTube All 2008 Red Herring Global Top 100 Private Companies from Finland are Technopolis Ventures customers 7Signal, Ball-it, Codenomicon, Hammerkit, Severa: represent Helsinki region, Lappeenranta and Oulu Selected from 1,800 of the top companies from Europe, North America, and Asia In addition to sparring and providing other support, we are proud reference customers of three of the winners!
Kuopio Acquisition The Technopolis Kuopio (previous Kuopion Teknologiakeskus Teknia Oy) deal was signed 21.2.2008 with Kuopio city. Technopolis Kuopio Oy was merged into the Group during Q4 Total 50 705 m2
Hermia 12, Tampere Completed in February, 2008 Total 5 000 m2 100 % occupancy
Hermia 15, Tampere Phase 1 start-up decision in May, 2008 MEUR 14,5 cost projection 12 150 m2 total space 70 % binding pre-lets to date Projected completion 8/2009
Vapaudenaukio, Lappeenranta Phase 1 completed May 2008 Total space 3 150 m2 100 % occupancy
Ruoholahti Phase 1 Total space 6 600 m2 Completed in August 2008 98 % occupancy Start-up center overbooked
Kontinkangas C & D, Oulu C Building Total space 3104 m2 Completed in August, 2008 100% occupancy D Building Total space 3319 m2 Completed in September 2008 100% occupancy
Helsinki-Vantaa Phase 5 Completed in December, 2008 Total space 6 700 m2 > 67 % occupancy
Yliopistonrinne Phase 1, Tampere Launched June, 2008 MEUR 33,3 cost projection Total space 19 200 m2 41 % binding pre-lets Projected completion 2/2010
Ohjelmakaari Phase 2, Jyväskylä Launched June, 2008 MEUR 7,7 cost projection Total space 4 790 m2 63 % binding pre-lets Projected completion 6/2009
Pulkovo Phase 1, St. Petersburg MEUR 50 cost projection Total space 24 100 m2 Projected completion Spring, 2010
New Top Management 15.9.2008 CEO Pertti Huuskonen took over as full-time Chairman of the Group Capital Area Director Keith Silverang became CEO
Technopolis Organization CEO CEO Keith Silverang Keith Silverang Reijo Tauriainen Acting CFO Group Management Team Keith Silverang, Reijo Tauriainen, Jukka Akselin, Satu Eskelinen Sales & Marketing Team Sales & Marketing Team Seppo Selmgren Seppo Selmgren Business Services Team Business Services Team Laura Krusius Laura Krusius Development Services Team Development Services Team Will Cardwell Will Cardwell Finland Finland Country Manager Country Manager Reijo Tauriainen Reijo Tauriainen National MT National MT Oulu Oulu Capital Area Capital Area Tampere Tampere Jyväskylä Jyväskylä Kuopio Kuopio Lappeenranta Lappeenranta Russia Russia Country Manager Country Manager Peter Coachman Peter Coachman St.Petersburg MT St.Petersburg MT RE Team RE Team BS Team BS Team New Markets New Markets Chairman Chairman Pertti Huuskonen Pertti Huuskonen Support Services Team Support Services Team Jukka Akselin Jukka Akselin Finance & Accounting Team Finance & Accounting Team Reijo Tauriainen Reijo Tauriainen
Technopolis Management Team Reijo Tauriainen, Keith Silverang, Satu Eskelinen, Jukka Akselin
System Technopolis Towards the end of 2008, we launched an internal development program designed to: Standardize and integrate key processes Invest in developing staff learning & competences Make efficient use of new technologies Enhance the Group s cost efficiency Improve quality and quality assurance Create a platform for international expansion
Key Figures 2008
Sales & Earnings 80 70 60 50 40 30 20 10 0 Net sales, EUR million +27,5 % 2005 2006 2007 2008 40 30 20 10 0 Operating margin, EUR million +29,2 % 2005 2006 2007 2008 Operating profit, EUR million 50 40 30 20 10 0-10 2005 2006 2007 2008 Change in fair value of investment properties Operating profit without change in fair value
Balance Sheet 800 700 600 500 400 300 200 100 0 Total assets & liabilities, EUR million +28,0 % 2005 2006 2007 2008 700 600 500 400 300 200 100 0 Fair value of investment properties, EUR million +26,7 % 2005 2006 2007 2008 Equity ratio % 50 40 30 20 10 0 2005 2006 2007 2008
Occupancy & Net Rental Yield Financial occupancy rate % 97,0 Net rental yield, % 96,5 96,0 95,5 95,0 94,5 94,0 93,5 93,0 Q1-2007 Q2-2007 Q3-2007 Q4-2007 Q1-2008 Q2-2008 Q3-2008 Q4-2008 9 8,5 8 7,5 7 6,5 2005 2006 2007 2008
Fair Value Calculation 29.1.2009 The Company is using the average of the net yield requirement figures provided by two independent external experts The realized average m 2 -based occupancy rate 2000 2008 was 97,5 % The 2008 financial occupancy rate was 96,6 % (average of quarterly figures) For 2009-2018 the occupancy rate used was 95,5 % The revision of the occupancy rates in the 31.12.2008 fair value calculations is based on the following: - In 2005 2008 Technopolis has bought 6 (Lappeenranta, Laanila, Jyväskylä, Tampere, Innopoli II and Kuopio) technology centers and expanded several technology centers - Technopolis has been able to boost occupancies in acquired sites and therefore the occupancy rates 2009 2018 were revised to give a more accurate picture of the current situation, taking the recession into account - History shows that the Technopolis concept also works in tough situations such as the dotcom recession of early 2000
Share Price Performance January 2, 2008-January 5, 2009 (peer group scaled) Eur/Share 7,00 6,00 5,00 4,00 3,00 2,00 1,00 2.1.2008 2.4.2008 2.7.2008 2.10.2008 2.1.2009 Technopolis Citycon Sponda
Shareholders Major Finnish Shareholders % of Share Capital Number of Shares Varma Mutual Pension Insurance Company 9,37 5 374 740 Ilmarinen Mutual Pension Insurance Company 6,52 3 737 725 City of Oulu 5,34 3 062 925 City of tampere 3,41 1 956 649 OP-Life Insurance 2,13 1 222 884 OP-Pension Fund 1,54 885 938 Jyrki Hallikainen 1,46 839 612 OP-Pension Trust 1,32 757 380 Finnish Cultural Foundation 1,24 712 693 Odin Finland 1,23 707 200 Total 33,58 19 257 746 Foreign and Nominee Registered 44,40 25 461 358
2009 Outlook Reasonable Demand for Technopolis products & services Sustained deterioration of economic conditions may present a challenge to growth targets The company will continue to take actions designed to safeguard profitability also in difficult conditions We expect net sales and EBITDA to grow 5-8 % in 2009
Vision 2012 Operating in all leading Finnish innovation hot spots, plus Russia and 2-3 other international markets Most attractive and competitive STP chain in Europe 15% average growth per annum Continue robust, controlled growth
Thanks! Keith.silverang@technopolis.fi +358 40 566 7787