NP3 Fastigheter Year-end report 2024

January – December

• Rental income increased by 11% to MSEK 1,992 (1,797).
• The net operating income increased by 11% to MSEK 1,503 (1,353).
• The profit from property management increased by 18% to MSEK 879 (745). Profit from property management per common share increased by 15% to SEK 13.57 (11.76).
• Changes in the value of properties amounted to MSEK 323 (-372).
• Net profit after tax for the year amounted to MSEK 914 (-61), which is equivalent to SEK 14.17 per common share (-2.43).
• Net investments for the year totalled MSEK 2,806 (715), of which MSEK 2,087 (408) related to acquisitions of properties, MSEK -33 (-15) related to divested properties and MSEK 21 (-128) related to investments in associated companies and joint ventures. Investments in existing properties and new construction during the year amounted to MSEK 731 (451).
• The board of directors proposes a dividend of SEK 5,20 per common share (5.48) to be paid on four occasions at SEK 1.30 each and a dividend of SEK 2.00 per preference share to be paid on four occasions at SEK 0.50 each. The total proposed dividend amounts to MSEK 405 (399), which is an increase of 1% and in accordance with the dividend policy.

October – December

• Rental income increased by 13% to MSEK 523 (464).
• The net operating income increased by 15% to MSEK 398 (346).
• The profit from property management increased by 42% to MSEK 250 (175). Profit from property management per common share increased by 38% to SEK 3.75 (2.72).
• Changes in the value of properties amounted to MSEK 121 (34).
• Net profit after tax amounted to MSEK 364 (-140), equivalent to SEK 5.63 per common share (-2.71).
• Net investments for the quarter totalled MSEK 2,088 (147), of which MSEK 1,897 (91) related to acquisitions of properties, MSEK 0 (-15) related to divested properties and MSEK -49 (-110) related to investments in associated companies and joint ventures. Investments in existing properties and new construction during the quarter amounted to MSEK 240 (181).

Comments by the CEO
Profit from property management in 2024 amounted to SEK 879 million (745) and for the fourth quarter to SEK 250 million (175). This represents an increase of 18 and 42 percent, respectively, compared with the previous year. The increase is due to increased rental income, a larger property portfolio through acquisitions and lower financial costs. Profit from property management per average common share for the year amounted to SEK 13.57 (11.76), equivalent to an increase of 15 percent.

The net operating income increased by 11 percent for the year and is explained by an 11 percent increase in rental income. Rental income in the comparable portfolio increased by 8 percent, attributable to indexation and investments in tenant adaptations. In addition, revenue increased through acquisitions of properties accessed during the fourth quarter with a value of SEK 1.9 billion, with an annual rental income of SEK 162 million. In addition to the improved net operating income, the 18 percent growth in profit from property management is due to improved net financial costs. The change in financial costs is due to lower interest expenses, which were a result of:
 
- A lower loan-to-value ratio via our new issue of common shares,
- lower base interest rate for a large portion of our debt portfolio, and
- lower credit margins.
 
The Board of Directors proposes a dividend of SEK 5.20 per common share and SEK 2 per preference share to be paid on four occasions. The total dividend corresponds to SEK 405 million, which corresponds to 50 percent of the profit from property management after current tax, in accordance with NP3's dividend policy.

Economic environment
At a global level, the international institutions and the rules to which we have become accustomed are being called into question. It is a fact that we live in a world of instability and disorder. The consequences of war, conflicts, and climate change affect us all. To this we can add the exponential development that is taking place within AI and which today is difficult to know where it will lead us.
 
In NP3’s immediate vicinity, the uncertainty in the economic cycle and, above all, concerns about investments in the green transition can be noticed. However, we do not see any noticeable drop in either rent payments from our customers or tenant demand for premises in our markets, despite some apprehension about this. This is true even if you look in isolation at our business area Skellefteå, which many have referred to as “Klondike” in the green transition. Since the start of 2020, net lettings in the Skellefteå business area amounts to SEK 33 million. For 2024, net letting amounted to SEK 8 million and for the most recent quarter to SEK 2 million. I would like to point out that NP3’s investments in Skellefteå are not directly linked to the green transition, even though its effects have generally affected us positively.

NP3 owns properties that are valued on average at just over SEK 10,000 per square metre. We have a large diversification in terms of customers, property categories and business industries. Any risk assessment regarding NP3’s business areas should be made taking into account these basic conditions.

For each investment, the assessment of an alternative use of the property and the cost of that is the most important factor. This starting point should also guide our future investments.
 
Total net letting is positive with SEK two million for the fourth quarter and SEK 30 million for the full year, of which SEK four million relates to renegotiations. Net letting is not an accurate measure of tenant demand as it often includes compensation for investments related to tenant adaptations, but a positive net letting trend indicates that there is continued good demand in our market.
 
The three reconstructions I mentioned last quarter have led to re- and new lettings, which has meant that NP3 has incurred only limited and short-term damage in these cases.
 
2025
A year ago, I wrote that we evaluated transactions with the goal to resume our strategy as a long-term growth company. As we sum up 2024, I can conclude that the goal of returning to growth has been met, and even more importantly, that we have met our goal of increasing our profit from property management per share at a maintained or lower operational and financial risk level.
 
Looking into 2025, it is my wish that you all will recognize yourselves. Our overall goal of strengthening profit from property management per share while maintaining or lowering operational and financial risk levels remains – and we will simply continue to do more of the same.
 
The forecast for 2025’s profit from property management, with the property portfolio now announced, amounts to SEK 1,030 million, which represents an increase of 18 percent compared to the outcome for 2024.
 
In conclusion, I would like to take this opportunity to thank all our staff who are committed to working every day to continue the course set. I would like to thank all stakeholders, especially shareholders and investors. Let us continue the journey, together!

This constitutes information that NP3 Fastigheter AB (publ) is legally obliged to publish under the EU's Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person specified, on 7 February 2025 at a.m. 08.00 (CET).

This report has been prepared in both Swedish and English versions. In case of variations in the content between the two versions, the Swedish version shall govern.