Toivo Group Plc’s half-year review 1 January–30 June 2022: Operating profit more than doubled to EUR 13.3 (6.0) million*, growth of 123%. 800 apartments being built.

 

 

Half-year Financial Report, 10. August 2022 at 8:30

 

* Unaudited

 

FINANCIAL PERIOD 1 JANUARY–30 JUNE 2022 KEY EVENTS

• Operating profit MEUR 13.3 (6.0).
• Contracts for building a total of 182 (296) apartments were made during the period under review.
• 417 (390) apartment start-ups during the period under review.
• 242 (95) apartments were completed during the period under review.

 

PROSPECTS FOR 2022 UNCHANGED

• The company expects the operating profit of the financial year of 1 January–31 December 2022 to be EUR 22–28 million. (Unchanged)
• 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*

* Unaudited

 

EUR thousand	1 January–30 June 2022		1 January–30 June 2021	Change %		1 January– 31 Dec. 2021
Revenue	6,576		7,940	-17%		13,574
Operating profit	13,318		5,986	123%		15,818
Profit or loss for the financial year	10,037		4,489	124%		12,071
Earnings per share (EUR)	0.19		0.10	94%		0.24
Fair value of investment properties	144,965		77,371	87%		97,649
Economic occupancy rate	98.8%		98.7%	0%		98.9%
Total equity	67,972		47,973	42%		54,420
Total assets	173,058		98,166	76%		121,054
EUR thousand	1 April–30 June 2022	1 April–30 June 2021			Change %
Revenue	2,945	4,210			-30%
Operating profit	6,325	3,242			95%
Profit or loss for the financial year	4,715	2,416			95%
Earnings per share (EUR)	0.09	0.05			70%
Fair value of investment properties	144,965	77,371			87%
Economic occupancy rate	98.70%	99.30%			-1%
Total equity	67,972	47,973			42%
Total assets	173,058	98,166			76%

 

 

CEO MARKUS MYLLYMÄKI

The first half of 2022 challenged the housing investment market in general. Thanks to the choices it made in 2019, the company has been able to operate well in the challenging market.

The company more than doubled its operating profit to MEUR 13.3. For the first time, the number of apartment being built exceeded the threshold of 800 apartments. The occupancy rate remained high at 98.8%.

In 2019, the company made important decisions in spite of low interest rates and the stable market environment. The company decided on a very strict investment strategy. The company only accepts the best sites. In addition, the company decided to implement all sites using its own develop, build and own business model. Most sites are built in energy class A and all sites are leased and managed using own Asuntomestarit®.

The year 2022 has challenged housing investors of all kinds in an exceptional way. Inflation is high. Interest rates began to increase rapidly. Construction costs have increased and availability has varied. At times, supply has exceeded demand in the housing market.

The strict choices made by the company in 2019 have proven their strengths in the challenging market situation. I would like to thank everyone at Toivo for their disciplined work in line with the strategy.

DEVELOPMENT: The challenging market conditions open up opportunities in development in particular. During the review period, the company launched and continued several negotiations on different sites. During the period, the company agreed on the construction of 185 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 the remainder of 2022.

CONSTRUCTION: The increase in the prices of building materials during the period under review was exceptional. Towards the end of the review period, stabilisation was visible in the costs of building materials. During the review period, the company started up the construction of 417 apartments, and for the first time, the total number of apartments under construction exceeded 800. Overall, 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: With regard to lease activities and management, Asuntomestarit® have succeeded well. The economic occupancy rate for the period was 98.8%. Toivo’s competitive, high-quality apartment product combined with the services of Asuntomestarit has proved its price-quality ratio in the challenging 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 40.5% and the financial loan to value (LTV) rate of its properties was 49.8%, both providing Toivo with financial resources.

The first half of 2022 was good for our company. I would like to thank everyone at Toivo for their disciplined and determined work for good results. I would also like to thank for the many customers that have chosen us.

ANALYST AND MEDIA EVENT

Toivo Group Plc is organising an analyst and media event on Wednesday, 10 August 2022 at 10:00. Guests can join the event at the website https://toivo.videosync.fi/2022-h1-tulos/ .

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.