Movinn Annual Report 2022

Completing an eventful year with 30% topline growth, 142 new units on group level and launching two new international markets. Steep domestic unit growth, international market launches and inflationary pressure have been tearing on bottom line metrics.  

Company Announcement no. 24 - 2023
28 March 2023, 08.00 CEST
This company announcement contains inside information.

Copenhagen, Denmark - The Annual Report covering results from 1 January - 31 December 2022 has been audited and approved by the Executive Management and the Board of Directors.

2022 was the Company's first year as a listed company and the management team starting the year focusing on executing on set growth targets and on the Company's ambitions to launch new international markets. Movinn have added 98 units in existing domestic markets, which is approximately 40 apartments more than the guided target, and two new international markets in Sweden with a combined unit number of 44. The Company have realized 73.3 mDKK in revenues (56.3 mDKK in 2021), which correspondsa to a 30% increase in revenue and in the high end of the full year guidance. The trade-off has been bottom line performance with both domestic growth and international launches has impacted margins. Furthermore, Company has not been immune to the general inflationary pressure and rising costs in especially energy and freight rates, all of which have impaced operational costs and investments. 

The Company has realized an EBITDA of 9 mDKK from the Danish operations (6 mDKK in 2021). This a below the full year guidance of 10-12 mDKK. The Swedish subsidiary is carrying an expected operational loss taking the total Group level EBITDA from operations down to 7 mDKK. Start up costs in Sweden and Germany is taking our our total retained earnings to a negative. Going into the year, the company expected to display profitability across the group. 

After the year's end, the Company continue to focus on short term consolidation, cost control and a transition towards generating free cash flows while continueing to plan for long term growth. The Company have adjusted their sourcing strategy, focusing on fewer, but larger projects in stead of adding stepwise smaller increments of new units throughout the year. This is expected to be a more efficient and profitable way to grow. 
 

Business Highlights in 2022

• Net increase in total unit number of 142 (98 domestically), taking the total apartment portfolio to 440 units at year's end. The increase is corresponding to a 47.2% growth in unit number.
• Commerical launch of two new international markets in Sweden. 44 apartments in total. 
• Preparations made ahead of a launch in Germany.  
• Vacancy rate of 10.3%
• Secondary product, Movinn Co-Living, is growing in parallel with the core business. 

 

Financial Highlights in 2022

Key Figures DKK ‘000	Denmark	Sweden	Germany	Group	2021	Change %
Financials
Revenue	72,458	0,866	-	73,324	56,260	30%
EBITDA (from operations)	9,052	(2,033)	-	7,019	6,040	16%
EBIT (from operations)	2,755	(2,332)	(917)	(494)	1,757	(128%)
EBITDA % (from operations)	12.5%	(234.7%)	N/A	9.6%	10.7%	(1,2%)
EBIT % (from operations)	3.8%	(269.1%)	N/A	(0.7%)	3.1%	(3.8%)
ROIC **	10.0%	N/A	N/A	0.8%	6.4%	(4.1%)
Cash Conversion Ratio (CCR)	53.6%	N/A	N/A	60.8%	128.3%	(52,6%)
Equity Ratio	45,6%	N/A	N/A	45,6%	48.2%	(2.0%)
Quick Ratio	1.44	N/A	N/A	1.44	2.08	(0.64)
Operational Data
Total unit number (BOP)	298	-	-	298	220	35.5%
Total unit number (EOP)	396	44	-	440	298	47.7%
Net change in units	98	44	-	142	78	82.1%
% Change	32.9%	N/A	N/A	47.7%	35.5%	34.4%
Revenue pr. Unit (‘000)	183	20	N/A	166	189	(11.7%)
Average Vacancy %	10.3%	40.5%	N/A	13.5%	10.6%	2.9%

 

Guidance for 2023
 

Guidance 2023	Denmark	Sweden	Germany	Group	2022	Change %
Revenue (mDKK)	80 - 83	3.5 – 5.0	-	83.5 - 88	73.3	14-20 %
EBITDA from operations (mDKK)	11-12	(1) - 0	-	10 - 12	7	43-71 %
EBIT (mDKK)	6 -7	(1.5) – (0.5)	(0.5) - 0	4.0– 6.5	(0.5)	N/A
Gross Investments	Lower	Lower	Unchanged	Lower	Higher	N/A
Pipeline	0-20	0-10	-	0-30	142	N/A
Cost of debt	5.0%	5.0%		5.0%	4.87%	0.13%
New Markets	-	-	-	-	2	N/A

CEO, Patrick Blok states: 

"We entered the year extremely eager to prove to the market that we could deliver on domestic growth targets and on the promised international launches. We have added 142 new units in total, which substantially more than was expected, and we launched two new international markets in Sweden. These achievements are significant and - in my opinion - an important indicator of our long term potential. I have also spent a lot of time in Germany laying the foundation on a commercial launch. Germany is by far the most important market in mainland Europe with maybe ten different markets with massive potential, so Germany is important to us. In general, we were thrown a bit off by the inflationary pressure and we tried to chase the costs throughout the year, not being able to shake if off us completely. The cost pressure and the steep growth have been impacting our margins, meaning we have delivered revenues in the high end of our expectations, but did not deliver on expectations to our bottom line. So overall I am not happy, but we have gained valuable insights throughout the year and made adjustments going forward to stay efficient while we continue to plan for long term growth. Looking to the world around us, we are not totally joyous, to be honest, with the macro-economic climate still challenged by war, rising interest rates and inflation. But we will monitor demand closely and  stay on our path - albeit in a more controlled manner". 

Disclosure regulation

The attached Annual Report contains forward looking guidance. Such guidance is subject to risk and uncertainties as different factors, some of which are beyond the control of Movinn, may cause the actual development and results to differ from forward looking expectations.