Stendörren - Operational momentum continues - ABG

Recurring PTP SEK 55m vs ABGSCe at SEK 57m
Q4'22: Rental income SEK 192m (1% vs ABGSCe 189m), NOI 136m (-1% vs ABGSCe 137m), Recurring PTP 55m (-4% vs ABGSCe 57m), CEPS 0.57 (-59% vs ABGSCe 1.40), Reported EPRA NRV 189 (-4% vs ABGSCe 198). NOI in the earnings capacity increased ~10% q-o-q to SEK 645m (584m in Q3’22) vs ABGSCe 2023e NOI of SEK 627m. CEPS was negatively affected by historically high current tax of SEK -22m (-2m). The occupancy rate amounted to 92% (91% in Q3’22 & 89% in Q4’21) and 93% based on net moving in for the next twelve months.

Property value changes of -2.8%
Property value changes in the quarter amounted to SEK -354m (-2.8% of property value), compared to our estimate of SEK -123m (-1.0%). The net initial yield (NOI from earnings capacity) increased ~0.6 pp q-o-q to 5.2% and the valuation yield increased 0.2 pp q-o-q to 5.90%. Total investments in new-builds, extensions and conversions amounted to SEK 196m (68m) and SEK 624m TTM (SEK 496m in Q3’22). Net LTV (ABGSC definition) amounts to 50.5% (50.1%), +0.8 pp q-o-q. The interest- and capital maturity amounts to 2.6 and 2.9 years, respectively, compared to Q3'22 at 2.7 and 3.0 years. The average interest rate increased ~0.3 pp q-o-q to 4.0% (2.3%).

Solid operational momentum
We appreciate the operational momentum in Stendörren, which has been strong in the last two years, and we think there is further potential for decreased vacancies also ahead. Add to that geographical expansion via selective acquisitions as well as a vast project portfolio, and we see the potential for sector-high growth in the coming years. The share is trading at 2023e NAV of 1.0x vs its three and five-year averages of a premium of +13% and +4%, respectively.

Länk till analysen i sin helhet: https://cr.abgsc.com/foretag/stendorren/Equity-research/2023/2/stendorren---operational-momentum-continues/