Kojamo plc Half-Year Financial Report 1 January–30 June 2022
Kojamo plc Stock Exchange Release, 18 August 2022 at 8.00 a.m. EEST
Kojamo plc’s Half-Year Financial Report 1 January–30 June 2022
Profitable growth continued, investments at the beginning of the year exceeded EUR 338 million
This is a summary of the January–June Half-Year Financial Report, which is in its entirety attached to this release and can be downloaded from the company’s website at www.kojamo.fi/investors.
Unless otherwise stated, the comparison figures in brackets refer to the corresponding period of the previous year. The figures in this Half-Year Financial Report have not been audited.
Summary of April–June 2022
- Total revenue increased by 3.9 per cent to EUR 100.5 (96.7) million
- Net rental income increased by 4.9 per cent totalling EUR 72.4 (69.1) million. Net rental income represented 72.1 (71.4) per cent of revenue
- Profit before taxes was EUR 94.8 (369.6) million. The profit includes EUR 47.1 (322.7) million in net gain on the valuation of investment properties at fair value. Earnings per share was EUR 0.31 (1.20)
- Funds From Operations (FFO) increased by 2.1 per cent and amounted to EUR 42.4 (41.5) million
- Gross investments totalled EUR 289.5 (108.5) million, representing 288.1 (112.1) per cent of total revenue
Summary of January–June 2022
- Total revenue increased by 3.1 per cent to EUR 200.0 (194.0) million
- Net rental income increased by 4.0 per cent to EUR 129.5 (124.5) million. Net rental income was 64.7 (64.2) per cent of total revenue
- Profit before taxes was EUR 157.8 (546.7) million. The profit includes EUR 75.1 (466.2) million in net gain on the valuation of investment properties at fair value and EUR 0.2 (0.3) million in profits and losses from the sale of investment properties. Earnings per share was EUR 0.51 (1.77)
- Funds From Operations (FFO) increased by 2.7 per cent to EUR 71.3 (69.4) million
- The fair value of investment properties was EUR 8.7 (7.5) billion at the end of the review period, including EUR 0.0 (1.1) million in Investment properties held for sale
- The financial occupancy rate was 91.5 (94.3) per cent for the review period
- Gross investments amounted to EUR 338.4 (176.5) million, or 169.2 (91.0) per cent of total revenue
- Equity per share was EUR 17.58 (14.84) and return on equity was 5.9 (25.1) per cent. Return on investment was 4.9 (17.2) per cent
- EPRA NRV (Net Reinstatement Value) per share grew by 16.9 per cent to EUR 22.29 (19.07)
- There were 2,230 (2,793) Lumo apartments under construction at the end of the review period
Kojamo owned 38,667 (36,165) rental apartments at the end of the review period. Since June of last year, Kojamo has acquired 985 (26) apartments, completed 1,625 (772) apartments and demolished or otherwise altered
-108 (-107) apartments.
Key figures
| 4–6/2022 | 4–6/2021 | Change % | 1–6/2022 | 1–6/2021 | Change % | 2021 | |
| Total revenue, M€ | 100.5 | 96.7 | 3.9 | 200.0 | 194.0 | 3.1 | 391.7 |
| Net rental income, M€ * | 72.4 | 69.1 | 4.9 | 129.5 | 124.5 | 4.0 | 262.3 |
| Net rental income margin, % * | 72.1 | 71.4 | 64.7 | 64.2 | 67.0 | ||
| Profit before taxes, M€ * | 94.8 | 369.6 | -74.3 | 157.8 | 546.7 | -71.1 | 1,278.9 |
| EBITDA, M€ * | 110.3 | 382.9 | -71.2 | 185.9 | 573.1 | -67.6 | 1,334.8 |
| EBITDA margin, % * | 109.8 | 395.9 | 92.9 | 295.5 | 340.8 | ||
| Adjusted EBITDA, M€ * | 62.9 | 59.9 | 5.0 | 110.6 | 106.3 | 4.0 | 228.5 |
| Adjusted EBITDA margin, % * | 62.6 | 61.9 | 55.3 | 54.8 | 58.3 | ||
| Funds From Operations (FFO), M€ * ¹⁾ | 42.4 | 41.5 | 2.1 | 71.3 | 69.4 | 2.7 | 153.1 |
| FFO margin, % * | 42.2 | 42.9 | 35.7 | 35.8 | 39.1 | ||
| FFO excluding non-recurring costs, M€ * | 42.4 | 41.5 | 2.1 | 71.3 | 69.4 | 2.7 | 153.1 |
| Investment properties, M€ ²⁾ | 8,743.2 | 7,507.2 | 16.5 | 8,327.5 | |||
| Financial occupancy rate, % | 91.5 | 94.3 | 93.9 | ||||
| Interest-bearing liabilities, M€ * | 3,626.4 | 3,371.0 | 7.6 | 3,334.5 | |||
| Return on equity (ROE), % * | 5.9 | 25.1 | 27.0 | ||||
| Return on investment (ROI), % * | 4.9 | 17.2 | 19.2 | ||||
| Equity ratio, % * | 47.9 | 45.8 | 49.0 | ||||
| Loan to Value (LTV), % * ³⁾ | 40.5 | 41.0 | 37.7 | ||||
| EPRA Net Reinstatement value (NRV), M€ | 5,507.8 | 4,712.2 | 16.9 | 5,447.9 | |||
| Gross investments, M€ * | 289.5 | 108.5 | 166.9 | 338.4 | 176.5 | 91.8 | 356.9 |
| Number of personnel, end of the period | 334 | 335 | 325 | ||||
| Key figures per share, € | 4–6/2022 | 4–6/2021 | Change % | 1–6/2022 | 1–6/2021 | Change % | 2021 |
| FFO per share * | 0.17 | 0.17 | 0.0 | 0.29 | 0.28 | 3.6 | 0.62 |
| Earnings per share | 0.31 | 1.20 | -74.2 | 0.51 | 1.77 | -71.2 | 4.14 |
| EPRA NRV per share | 22.29 | 19.07 | 16.9 | 22.04 | |||
| Equity per share | 17.58 | 14.84 | 18.5 | 17.25 | |||
| * In accordance with the guidelines issued by the European Securities and Markets Authority (ESMA), Kojamo provides an account of the Alternative Performance Measures used by the Group in the Key figures, the formulas used in their calculation, and reconciliation calculations in accordance with ESMA guidelines section of the Half-Year Financial Report | |||||||
| ¹⁾ The formula used in the calculation was changed in 2021 regarding current taxes from disposals. The comparison figures for 4-6/2021 and 1-6/2021 have been adjusted to reflect the current calculation method | |||||||
| ²⁾ Including Non-current assets held for sale | |||||||
| ³⁾ Excluding Non-current assets held for sale | |||||||
Outlook for Kojamo in 2022 (specified)
Kojamo estimates that in 2022, the Group’s total revenue will increase by 4–6 per cent (previously 3–6 per cent) year-on-year. In addition, Kojamo estimates that the Group’s FFO for 2022 will amount to between EUR 155–165 million, excluding non-recurring costs (previously EUR 153–165 million).
The outlook is based on the management’s assessment of total revenue, property maintenance costs and repairs, administrative expenses, financial expenses, taxes to be paid and new development to be completed, as well as the management’s view on future developments in the operating environment.
The outlook takes into account the estimated occupancy rate and rises in rents as well as the number of apartments to be completed. The outlook does not take into account the impact of potential acquisitions or disposals on total revenue and FFO.
The management can influence total revenue and FFO through the company’s business operations. In contrast, the management has no influence over COVID-19 restrictions, market trends, the regulatory environment or the competitive landscape.
CEO’s review
Our operations continued as expected in the second quarter of the year. We managed to increase our total revenue, net rental income and FFO despite exceptional uncertainty in the operating environment. The fair value of our investment properties rose to EUR 8.7 billion and our financial position remained strong.
The impact of COVID-19 restrictions has been reflected in the occupancy rate, which is still lower than in the previous year. The COVID-19 pandemic is not yet over, but its impact has diminished since the restrictions were lifted at the end of March. Tenant turnover decreased during the second quarter. We expect the trend of urbanisation to gradually return to normal and the demand for rental housing to recover. Our rental operations accelerated notably at the beginning of the summer. The number of tenancy agreements concluded in July and August shows a clear improvement compared to the previous year.
Our growth in line with the strategy took a significant leap at the end of June when we purchased 942 apartments. All purchased properties are located in the capital region, Turku and Jyväskylä. The properties are an excellent addition that will strengthen our housing supply in Finland’s growth centres. In addition to these, we purchased in June a newly renovated building comprising 43 apartments in Etu-Töölö, Helsinki.
Our investments have also progressed well with regard to development projects. At the end of the review period, 2,230 apartments were under construction, and 784 apartments were completed during the early part of the year. Our current projects are implemented on a fixed-price basis, which means that cost increases have not had a significant impact on them. The increase in interest rates and the prices of construction materials poses challenges to the volumes in the industry.
Our Lumo One skyscraper will be fully completed in early September. The tower building, a rarity in Finland, will have a total of 291 apartments on 31 floors completed in two phases. The first 104 residents were able to move into the building at the turn of June and July, and preparations are being made for the residents of the top floors to move in at the end of August.
Interest rates have risen and the situation in the financial market has changed quickly. Due to the high hedging ratio, the increase in interest rates did not impact our financial expenses, and thanks to the bond we issued at the beginning of the year, our financial position is strong.
At the beginning of the autumn, the outlook for the Finnish economy has generally deteriorated and uncertainty in the market persists. However, Kojamo is in a good position to continue the implementation of its strategy. Our strong balance sheet and good liquidity support our goals.
Jani Nieminen
CEO
News conference as a webcast
Kojamo will hold a news conference for institutional investors, analysts and media on 18 August 2022 at 10.00 a.m. EEST at the company’s head office at Mannerheimintie 168A, Helsinki. The event will be held in English. After the event, the media has a possibility to ask questions also in Finnish. Participants are asked to attend the event in person only if they are completely healthy.
The event can also be followed as a live webcast. A recording of the webcast will be available later on the company website at https://kojamo.fi/en/investors/releases-and-publications/financial-reports/.
The news conference can be followed online at https://kojamo.videosync.fi/q2-2022-results.
You can also participate in the news conference by calling:
FI: +358 981 710 310
SE: +46 856 642 651
UK: +44 333 300 0804
US: +1 631 913 1422
The participants joining the news conference will be asked to provide the following PIN code: 36608542#
For more information, please contact:
Niina Saarto, Group Treasurer, Investor Relations, Kojamo plc, tel. +358 20 508 3283, [email protected]
Erik Hjelt, CFO, Kojamo plc, tel. +358 20 508 3225, [email protected]
Distribution:
Nasdaq Helsinki, Irish Stock Exchange, key media
Kojamo is Finland’s largest private residential real estate company and one of the biggest investors in Finland. Our mission is to create better urban housing. Lumo offers environmentally friendly housing and services for the city dweller who appreciates quality and effortlessness. We actively develop the value of our investment properties by developing new properties and our existing property portfolio. We want to be the property market frontrunner and the number one choice for our customers. Kojamo’s shares are listed on the official list of Nasdaq Helsinki. For more information, please visit https://kojamo.fi/en/
Attachments
- Kojamo Half-Year Financial Report January-June 2022 presentation
- Kojamo Half-Year Financial Report January-June 2022
