Toivo Group Plc’s business review 1 January–31 March 2022: Operating profit more than doubled to EUR 7.0 (2.7) million, growth of 155%*. The company updates its outlook for the current year

Business Review, 11. May 2022 at 8:30

* Unaudited

FINANCIAL PERIOD 1 JANUARY–31 MARCH 2022 KEY EVENTS

• Operating profit MEUR 7.0 (2.7).
• 179 (16) apartments were completed during the period under review.
• 262 (70) apartment start-ups during the period under review.
• Contracts for building a total of 85 (137) apartments were made during the period under review.

UPDATE OF GUIDANCE FOR 2022

• The company expects the operating profit of the financial year of 1 January–31 December 2022 to be EUR 22–28 million. (Previously: The company expects the operating profit of the financial year of 1 January–31 December 2022 to be EUR 20–28 million.
• The company expects the fair value of investment properties to be approximately EUR 175 (12/2021: 97.6) million at the end of 2022. (Unchanged)

CONSOLIDATED KEY FINANCIALS*
 

EUR thousand* Unaudited	1 January – 31 March 2022	1 January – 31 March 2021	change %
Revenue	3,631	3,730	-3%
Operating profit	6,993	2,744	155%
Profit or loss for the financial year	5,322	2,073	157%
Earnings per share (EUR)	0.10	0.05	100%
Fair value of investment properties	121,262	66,900	81%
Economic occupancy rate	99.0%	98.1%	1%
Total equity	58,534	31,335	87%
Total assets	139,990	73,438	91%

CEO MARKUS MYLLYMÄKI

The start of 2022 was exceptional as a business environment. The world was just recovering from a pandemic crisis when the war in Ukraine began. In spite of that, the company got off to a good start in 2022. The company more than doubled its operating profit year-on-year and, at the end of the period under review, the company had almost doubled the number of apartments under construction.

The company’s business model, according to which it develops, builds and owns all of its apartments, is exceptional. There is high demand for the company’s products, apartments, in the rental market, where the competition for good tenants is currently hard. The business model is highly predictable in terms of the long-term results and provides better than average protection from market changes. The company controls its residential real estate throughout its life cycle and it can respond to changes in the market quickly. The war in Ukraine has not had material impacts on Toivo’s business so far, and the company’s result was at the expected level.  

LAND DEVELOPMENT: The competition over good construction sites is tough. The company launched lots of new negotiations on new sites during the period under review. During the period, the company agreed on the construction of 85 new apartments. The pursued number of new signed contracts was not reached in the short term, but the situation is expected to be remedied during 2022.

CONSTRUCTION: The increase in the prices of building materials during the period under review was exceptional. An indication of successful construction and development is that the company has managed to hold on to development margin levels. The value changes of the sites under production by the company have compensated for the increased costs related to the sites in relation to original forecasts.

OWNERSHIP OF APARTMENTS: With regard to lease activities and management, Asuntomestarit® have succeeded well. The economic occupancy rate for the period was 99%. Toivo’s competitive, high-quality apartment product combined with the services of Asuntomestarit has proved its price-quality ratio in the competitive market.

Toivo’s business is growing strongly and it is vitally important to secure an optimal financial structure to facilitate the growth. The company’s equity ratio was 42.1% and the financial loan to value (LTV) rate of its properties was 48.6%, both at a secure level to provide financial resources.

The start of 2022 was very good for our company. As the CEO, I am very pleased how an increasing number of customers are choosing Toivo apartments. In particular, for the good start to 2022 I would like to thank the people of Toivo who incessantly work to achieve the best results for our customers without failing to achieve good financial results.

ANALYST AND MEDIA EVENT

Toivo Group Plc is organising an analyst and media event on Wednesday, 11 May 2022 at 11:00. Guests can join the event at the website https://toivo.videosync.fi/2022-q1-tulos/register .

The results will be presented by Toivo Group’s CEO Markus Myllymäki and CFO Samuli Niemelä. Presented material will be available at company website sijoittajille.toivo.fi/en after the event.

Toivo Group Plc

Board of Directors

Further information
Markus Myllymäki
CEO
Toivo Group Plc
Tel. +358 (0)40 847 6206
[email protected]

Certified Adviser: Danske Bank A/S, Finland branch, +358 (0)50 575 4422

About Toivo
Toivo is a Finnish real estate company that was founded in 2015. Its business consists of developing apartment lots, constructing housing and ownership of apartments. The Company’s business model is unique as Toivo’s business combines the value chain of real estate business from development and construction to ownership, management and rental of a completed property. Toivo manages the entire life cycle of residential real estate with its own team, from raw land development to renting apartments. This way Toivo is able to generate additional value to its customers, shareholders and stakeholders.

Toivo’s strategy is to develop apartments in accordance with the Toivo concept. The apartments aim for a strong development margin and a stable and attractive return, and this way enable long-term ownership and the generation of higher additional value to Toivo’s customers. Toivo has a knowledgeable and experienced team of experts with strong merits in the real estate business. The members of Toivo’s team have been involved in the development and construction of over 17,000 apartments, and they have an average of ten years of experience.

Toivo’s revenue in 2021 was EUR 13.6 million and its operating profit was EUR 15.8 million.