Stenhus Fastigheter: NOI beat on strong topline figure - ABG

First take on Q4 figures
Stenhus delivered a Q4 report with rental income of SEK 235m (+113% y-o-y, +9% vs ABGSCe). The NOI margin during the quarter was 71.5% (-6.9 pp y-o-y, -4.5 pp vs ABGSCe) which took the NOI to SEK 168m (+3% vs ABGSCe). Central administration costs and income from JV's were broadly in line with estimates, meaning rec EBIT was +2% vs ABGSCe, while net financial expenses came in slightly below our forecast at -SEK 77m (ABGSCe at -SEK 81m), which drove IFPM to SEK 80m (ABGSCe at SEK 73m). The occupancy increased by 50 bps q-o-q to 95.8% and the WAULT was 6.2 years (6.0 in Q3'22). In line with previous communication, Stenhus has settled the 2023 bond in Q1'23, and the interesting upcoming "maturity" will be its current bridge debt (~SEK 560m as of Q4'22). Stenhus note that it has received additional credit facilities in Q1'23.

Property value changes of -2.1%
Property value changes in the quarter amounted to -SEK 306m (-2.1% of property value), compared to our estimate of -SEK 301m (-2.1%). The valuation yield expanded by 25 bps q-o-q to 5.6%. This took the EPRA NRV per share to SEK 17.1 (+1% vs ABGSCe at SEK 17.1). Net LTV (ABGSC definition) now amounts to 55.8%, +1.5 pp q-o-q and +0.8 pp vs ABGSCe. The interest- and capital maturity amounts to 1.1 and 3.5 years, respectively, compared to Q3'22 at 0.9 and 3.6 years. The average interest rate increased ~60 bps q-o-q to 4.12%.

Great properties, time to clear refinancing
Compared to most peers, Stenhus has a longer WAULT (6.2 years), higher NOI margin (78.5% in EC), higher property valuation yield (5.6%) and strong tenants (e.g. Willys, City gross, municipalities). In addition, we like the segment exposure (~40% light industrial, ~20% groceries, ~20% public). The share is trading at a 2023e P/CEPS of ~13x (sector average at ~18.5x), and we believe that some investors fear the upcoming refinancing (existing bridge facility and bonds). Once that is cleared, it's easier to look ahead and appreciate the operational exposure, in our view.

Länk till analysen i sin helhet: https://cr.abgsc.com/foretag/stenhus-fastigheter/Equity-research/2023/2/stenhus-fastigheter---noi-beat-on-strong-topline-figure/