(Información remitida por la empresa firmante)
HÄSSLEHOLM, Sweden, Feb. 16, 2023 /PRNewswire/ —
Financial ratios for the period 1 January–31 December 2022
(corresponding period in 2021)
Rental income: SEK 384.2 million (265.9)
Profit from property management: SEK 130.7 million (101.4)
Profit for the period: SEK 907.4 million (1 044.4)
Net investments in investment properties: SEK 2,707.0 million (1,608.1)
Investment properties: SEK 13,094.6 million (9,603.7)
Long–term net asset value (NAV): SEK 5,768.3 million (4,976.1)
Number of apartments under management: 3,708 (2,723)
Number of construction starts, apartments: 1,012 (996)
Number of apartments under construction: 2,058 (1,820)
Number of apartments under project development: 4,046 (5,869)
Interest coverage ratio, R12m: 2.2 multiple (3.4)
Equity/assets ratio: 33.9% (31 Dec 2021: 36.9)
Debt–to-equity ratio: 55,4% (31 Dec 2021: 51.8)
Profit from property management per share: SEK 0.61 per share (0.47)
Long–term net asset value (NAV) per share: SEK 26.79 per share (23.11)
Growth in profit from property management per share: 28.9% (29.8)
Growth in long-term net asset value (NAV) per share: 15.9% (35.9)
Earnings per share*: SEK 4.13 per share (4.85)
* There are no potential shares (e.g. convertibles in the company, and accordingly no dilution effect).
A message from the CEO
In many respects, 2022 has been a challenging year amid soaring inflation, the war in the neighboring region, and rising interest rates. Society as a whole is facing harder economic times, as households grapple with rising food prices and volatile energy prices with high peaks, among other issues. Companies are also coping with higher prices of energy and other input goods. In the construction and real estate industry, the number of construction starts is now clearly down from the high levels that prevailed when economic conditions were different.
We are sensitive to the current market situation, but we are also very confident in our business model. I dare say that by controlling the entire chain from project development through prefab and construction, to management, we are better equipped than most in the industry to continue to launch rental housing projects. This is, of course, provided that the construction starts meet our internal requirements on acquisition cost in relation to market value, what we have come to call PTV (production-to-value), and yield on cost. The internal efficiency, collaboration between, and integration of our business areas have played an important role in enabling us to face increased costs in 2022. I can’t thank enough all the people in the entire Group who have made this possible through hard work and innovative thinking. In this regard, the acquisition of K-Prefab has been important for the Group as well as for K-Prefab, where there have been investments in efficiency, personnel, and climate since the acquisition.
K–Prefab has achieved record sales in 2022, but gross profit has declined due to increased costs for material and lower margins on internal projects. The company has successfully handled the tougher market environment, despite a decline in profit, and K-Prefab has secured order books of over SEK 1 billion for 2023. Along with the investments made since the acquisition, I am positive that K-Prefab will continue to deliver attractive frame solutions to external customers as well as within the Group. We are closely monitoring developments for the coming years, where the business will be affected by cost developments as well as the number of new construction projects in Sweden.
I strongly believe in rental property as a form of housing and am convinced that rental property is a wise long-term investment that can generate solid and stable cash flows. In difficult times, rental property tends to be a more attractive form of housing than owned property. Our new constructions compete in many ways with tenant-owned apartments. Given the interest rate fluctuation for both individuals and housing associations, rental property should strengthen its competitiveness, something that benefits a company like K-Fastigheter, which has a large proportion of newer properties and which completes and starts construction of rental apartments at a high pace. We hope that the decline in construction can result in faster planning and building permit processes for municipalities as the pressure on them eases. Shorter planning and building permit processes are vital components in maintaining sufficient levels of construction in Sweden to meet ongoing demand.
K–Fastigheter is constantly evaluating the acquisition of building rights to expand our land bank. At the end of 2022, we completed two acquisitions of building rights in attractive cities. We acquired 180 building rights in Västerås from Balder in an exchange deal where K-Fastigheter divested an investment property in Helsingborg consisting mostly of commercial premises. In Örebro, K-Fast Kilen, a company in which K-Fastigheter holds 51 percent and Kilenkrysset holds 49 percent, acquired 300 building rights. I am hopeful to be able to make more acquisitions in 2023 if the right opportunities arise. At the end of the year, the Project Development business area was working on a portfolio equivalent to 4,046 apartments in various stages.
During the year, the Construction business area completed and handed over 840 apartments spread over 15 projects to our management organization. Six of these projects are equipped with photovoltaic panels. This is in line with the direction we have taken to ensure that from 2021 onwards, construction starts of Apartment Blocks and Lateral Low-Rise apartments will include photovoltaic panels. At the end of the year, the Construction business area recorded 2,058 apartments under construction.
In the full-year 2022, the number of apartments under management increased by 36 percent to a total of 3,708. The rental value of our portfolio has increased to nearly SEK 490 million, which represents a growth of 49 percent in 2022. In addition, ongoing construction at the end of the year will increase our rental value by 61 percent. The proportion of our property portfolio completed after 2010 continues to increase and accounts for 85 percent, with the majority of the properties completed in the last three years.
Over the year, the financial occupancy rate has increased and was 97. 3 percent at the end of the year, helping our profit from property management, which was pressured at the year-end by increased operating costs related to electricity and heating and higher financing costs due to rising interest rates. This will be partially offset in the coming year by rent increases. However, the rent hikes for the coming year will not fully compensate for the cost increases, which will have to be compensated for gradually over time. There is a continuous effort to optimize the operation of our properties.
(CONTINUA)