Oscar Properties: Focus on deleveraging in 2023 - ABG

Positive net leasing in both Q4'22 and 2022
Finalised divestments and more to come
Net LTV of 73.5% and increasing to 77.0% in Q4'23e


Rental income increased ~11% q-o-q in Q4'22

Oscar Properties reported rental income and NOI of SEK 119m and SEK 82m, up by ~11% and ~23% q-o-q, respectively. Moreover, income from property management improved materially q-o-q, although still negative at SEK -14m (-22m). Net leasing was positive at SEK 1.4m in Q4 and SEK 7.7m for 2022, and the occupancy rate improved 1pp q-o-q to 88%. Property value changes amounted to -3.8%, and we forecast another ~6% value decline in 2023. Overall, Q4'22 was better than expected but we still cut estimates as 1) Oscar Properties has decided not to complete a SEK 1,050m portfolio acquisition (vs the reported property value of SEK 6,666m in Q4'22), and 2) interest rate expectations have increased further and Oscar Properties has 88% floating debt. As CEPS is in negative territory for 2023e-2025e, one should not focus on that estimate change, in our view.

Länk till analysen i sin helhet: https://cr.abgsc.com/foretag/oscar-properties/Equity-research/2023/3/oscar-properties---focus-on-deleveraging-in-2023/