Lumo Homes Plc · OMXHEX:LUMO
Lumo Homes — Kojamo — H1 2019 Earnings Presentation
41 slides from Lumo Homes's earnings presentation, Aug 23, 2019
Slide 1: Half-Year Financial Report
Half-Year Financial Report 23 August 2019 Jani Nieminen, CEO Erik Hjelt, CFO 1–6/2019 Kojamo plc
Slide 2: Agenda
Agenda • Summary of January–June 2019 • Financial development • Outlook, financial targets and dividend policy Kojamo plc's Half-Year Financial Report January–June 2019 2
Slide 3: Summary of January–June 2019
Summary of January–June 2019 Kojamo plc's Half-Year Financial Report January–June 2019 3
Slide 4: Operating environment
Operating environment Business environment key figures 7.4 6.3 6.6 6.2 General operating environment 2.4 1.6 1.5 1.7 • Kojamo is affected particularly by urbanization, the situation 1.1 1.2 1.2 1.1 in the residential property market and development in the Finnish growth centres, as well as macro-eco
Slide 5: Operating environment
Operating environment Industry key figures 2019E 2018 Residential start-ups, units 39,000 46,200 Building permits granted, annual*, units 38,651 48,602 Construction costs, % 2.0 2.5 Residential production and price development Prices of old dwellings in the whole country, change, % 1.2 1.2 • The vol
Slide 6: Operating environment
Operating environment Development of household sizes (% of all households) 45% 40% The popularity of rental housing increases 35% • The trend of regional divergence will accelerate in 30% 2019–2040 and the significance of the 10 largest urban 25% areas will increase 20% • Urbanisation increases the
Slide 7: Key figures 1–6/2019
Key figures 1–6/2019 total revenue net rental income funds from operations (FFO) 184.6 M€ 117.7 M€ 66.4 M€ (EUR 178.0 million, (EUR 109.5 million, (EUR 39.5 million, +3.7%) +7.4%) +68.1%) fair value of investment profit excluding properties gross investments changes in value* profit before taxes 5.3
Slide 8: Of the apartments' fair value 98.3% in the seven largest Finnish growth centres
Of the apartments’ fair value 98.3% in the seven largest Finnish growth centres Apartment distribution, % Helsinki region 4.2% 3.2% 4.8% Fair Fair value Fair Tampere Number of Financial 4.9% value, (EUR value region Region apartments, occupancy (EUR thousand / (EUR / 6.3% units rate, % million) unit
Slide 9: The apartment portfolio grew
The apartment portfolio grew • During the review period, 4 (1,812) apartments were sold, 99 (981) acquired and 383 (689) completed Development of apartment portfolio, units +3.0% 41,153 34,974 34,383 34,713 34,172 35,194 12,437 1,229 3,866 3,365 31,108 31,018 33,484 28,716 2015 2016 2017 2018 30 Jun
Slide 10: Lumo builds customer experience in a new way
Lumo builds customer experience in a new way Services of a new customer Services during tenancy Key courier Easy pick up service service Installation service Personal Pets are Lumo Yard open welcome janitors coach house Car- 0– Affordable security Broadband included Benefits from sharing partners 25
Slide 11: Electronic services make every day life easier
Electronic services make every day life easier Share of new rental agreement by Over channel* 12,000 rental agreements via webstore by the end of 63% June 76% 93% 51% 66% • Fully automated service, where tenant can 37% choose his or her apartment and rent it at 24% 34% 49% once 7% 2016 2017 2018 1–6
Slide 12: Financial development
Financial development Kojamo plc's Half-Year Financial Report January–June 2019 12
Slide 13: Total revenue increased
Total revenue increased • Total revenue increased by 3.7 per cent from the comparison period • Profit excluding changes in value increased, but smaller changes in value had an impact on profit before taxes Total revenue, M€ Profit before taxes, M€ Changes in value* Profit excluding changes in value
Slide 14: Net rental income and FFO increased
Net rental income and FFO increased • Net rental income developed positively and increased by 7.4 per cent • In addition to improved net rental income, lower income taxes than in the comparison period had an effect on FFO growth Net rental income, M€ Funds From Operations (FFO), M€ and €/share Lumo
Slide 15: Occupancy rate increased
Occupancy rate increased • Occupancy rate increased despite of slight increase in tenant turnover Financial occupancy rate, % Tenant turnover, % excluding internal turnover 97.6 97.4 96.7 97.0 96.5 96.9 28.6 28.8 27.6 23.7 14.7 15.1 2015 2016 2017 2018 1–6/2018 1–6/2019 2015 2016 2017 2018 1–6/2018
Slide 16: Gross investments
Gross investments • Investments proceeding according to strategy Gross investments and sales of Modernisation investments and investment properties, M€ repairs, M€ Gross investments Sales of investment properties Modernisation investments Repairs 696.0 92.4 367.3 365.2 68.4 235.0 243.2 46.5 61.0 59.
Slide 17: The value of investment properties increasing in line with strategy
The value of investment properties increasing in line with strategy • The fair value of investment properties increased by 7.7 per cent • Kojamo announced to change from transaction-based valuation technique to yield-based valuation technique as of 31 December 2019 Fair value of investment propertie
Slide 18: Plot and real estate development reserve 30 June 2019
Plot and real estate development reserve 30 June 2019 Plots and real estate development sites owned Regional division of plot and by the company 1,000 real estate development reserve M€ fl.sq.m. Apartments per sq. m., % Plots 43.2 70 ~1,100 Plots and existing residential building 28.8 44 ~700 2) Con
Slide 19: Equity ratio improved
Equity ratio improved • Equity ratio and Loan to Value (LTV) were in line with financial targets Equity ratio, % Loan to Value, (LTV), % 47.1 45.9 46.7 46.9 46.0 41.3 43.0 41.6 41.9 41.1 40.7 39.8 2015 2016 2017 2018 30 Jun 30 Jun 2015 2016 2017 2018 30 Jun 30 Jun 2018 2019 2018 2019 The share issue
Slide 20: EPRA NAV per share improved
EPRA NAV per share improved • Key figures per share improved Equity per share, € 1) EPRA NAV per share, € 1) +4.8% +6.4% 9.54 9.55 11.69 11.88 8.88 9.11 11.11 11.17 8.10 10.31 7.58 6.75 6.88 2013 2014* 2015 2016 2017 2018 30 Jun 30 Jun 2016 2017 2018 30 Jun 30 Jun 2018 2019 2018 2019 * As of 2014, t
Slide 21: Versatile capital structure
Versatile capital structure The Group’s loan distribution Financing key figures 30 Jun 2019 % years Average interest rate fixing period, years 3 5.4 6 Loan portfolio EUR 2,554 million 5.1 5 Average loan maturity, years 2.5 4 Bonds 1,300 M€ 3 4% 2% 0% 2 Average interest rate, % 2 Loans from financial
Slide 22: Outlook, financial targets and dividend policy
Outlook, financial targets and dividend policy Kojamo plc's Half-Year Financial Report January–June 2019 22
Slide 23: We are progressing toward our strategic targets
We are progressing toward our strategic targets Actual Target Strategic key figures 30 Jun 2019 Dec 2021 Fair value of investment properties, 5.3 6.0 Bn€ Number of apartments 35,194 ~38,000 Equity ratio, % 41.9 > 40 Loan to Value (LTV), % 46.9 < 50 FFO as a percentage of total revenue 36.0 > 32 Net
Slide 24: Outlook for Kojamo in 2019 (specified)
Outlook for Kojamo in 2019 (specified) Kojamo estimates that in 2019, the Group’s total revenue will increase by 3–5 per cent year-on-year (previously 2–7 per cent). In addition, the company estimates that the Group’s FFO for 2019 will amount to between EUR 134–144 million, excluding one-off items (
Slide 25: Dividend policy
Dividend policy Kojamo’s objective is to be a stable Dividend history dividend payer whose annual dividend 62% 0.51 payment will be at least 60 per cent of FFO, 0.29 0.29 provided that the Group’s equity ratio is 40 0.16 0.22 per cent or more and taking account of the 0.22 company’s financial positi
Slide 26: Summary
Summary Central key figures The occupancy rate The number of rented improved during the review increased supported by the apartments via webstore has period: total revenue and net development of the renting exceeded already 12,000, rental income increased, process and webstore in MyLumo web mobile s
Slide 27: Thank you!
Thank you! Interim Report 1–9/2019 to be published on 6 November 2019 Contact details: CEO Jani Nieminen, tel. +358 20 508 3201 CFO Erik Hjelt, tel. +358 20 508 3225 Manager, Investor Relations Maija Hongas, tel. +358 20 508 3004 www.kojamo.fi Kojamo plc's Half-Year Financial Report January–June 201
Slide 28: Appendix
Appendix Kojamo plc's Half-Year Financial Report January–June 2019 28
Slide 29: Kojamo evolution: From VVO Group to Kojamo
Kojamo evolution: From VVO Group to Kojamo Modern residential portfolio with focus on Lumo apartments 2021 Target ~ € 6 bn € 5.1 bn € 5.3 bn* € 4.7 bn € 4.3 bn € 4.0 bn Name changed to Kojamo Kojamo received VVO Lumo Baa2 rating from Kojamo issued converted to Lumo webstore was the first listed Mood
Slide 30: Kojamo plc's strategy
Kojamo plc’s strategy Megatrends Mission Values We create better urban housing. Urbanisation & internationalisation Happy to serve Vision 2021 Ageing population & smaller family sizes We are the property market frontrunner and the number one choice for our customers. New technologies & digitalisatio
Slide 31: Customer experience at the center
Customer experience at the center • We focus on creating excellent customer experience, which comes from versatile living solutions, easy contacting and fluent digital services. Our homes are located close to good transport connections and services • We develope new living services and solutions tog
Slide 32: Services enabling better urban living
Services enabling better urban living Unique Lumo webstore Lumo is a home full of Activities and other Constantly improving services benefits to customers customer experience The only residential real Comprehenive Activities and other Developing digital estate company with a services that ma
Slide 33: Sustainability is visible in our every day life
Sustainability is visible in our every day life Eco-friendly All of Anti-grey 29,000 motoring new construction projects utilising own plot reserves economy apartments’ indoor temperature controlled by – shared cars in use of nearly zero-energy buildings in accordance models Leanheat’s IoT solution L
Slide 34: Sustainability is part of our operations
Sustainability is part of our operations • Kojamo is committed to developing new and modern construction solutions, housing services and ecological innovations related to energy-efficient housing solutions. All of Kojamo’s new construction projects utilising own plot reserves will be nearly zero-ene
Slide 35: Kojamo's ten largest shareholders (30 Jun 2019)
Kojamo’s ten largest shareholders (30 Jun 2019) Number of % of Development of number of 26.2% Shareholder shares shares Ilmarinen Mutual Pension Insurance shareholders 25.3% 1. Company 32,359,243 13.1 23.9% 23.7% 24.1% Varma Mutual Pension Insurance 2. 30,398,089 12.3 Company 3. The Finnish Industri
Slide 36: Key figures
Key figures 4–6/2019 4–6/2018 Change,% 1–6/2019 1–6/2018 Change,% 2018 Total revenue, M€ 93.1 89.8 3.7 184.6 178.0 3.7 358.8 Net rental income, M€ 66.8 61.4 8.8 117.7 109.5 7.4 234.0 Net rental income margin of total revenue, % 71.8 68.4 63.8 61.5 65.2 Profit before taxes, M€ 85.9 91.5 -6.1 124.8 14
Slide 37: Consolidated income statement
Consolidated income statement M€ 4–6/2019 4–6/2018 1–6/2019 1–6/2018 1–12/2018 Total revenue 93.1 89.8 184.6 178.0 358.8 Maintenance expenses -17.8 -18.4 -51.7 -50.9 -89.5 Repair expenses -8.5 -9.9 -15.2 -17.5 -35.4 Net rental income 66.8 61.4 117.7 109.5 234.0 Administrative expenses -10.5 -11.2 -1
Slide 38: Balance sheet
Balance sheet M€ 30 Jun 2019 30 Jun 2018 31 Dec 2018 ASSETS Non-current assets Intangible assets 0.2 0.3 0.2 Investment properties 5,279.5 4,923.3 5,093.2 Property, plant and equipment 31.2 30.7 30.5 Investments in associated companies 2.2 2.6 2.2 Financial assets 0.6 0.5 0.6 Non-current receivables
Slide 39: Balance sheet
Balance sheet M€ 30 Jun 2019 30 Jun 2018 31 Dec 2018 EQUITY AND LIABILITIES Equity attributable to shareholders of the parent company Share capital 58.0 58.0 58.0 Share issue premium 35.8 35.8 35.8 Fair value reserve -49.4 -19.4 -23.9 Invested non-restricted equity reserve 164.4 164.6 164.4 Retained
Slide 40: Financial key figures
Financial key figures 30 Jun 2019 31 Mar 2019 31 Dec 2018 30 Sep 2018 30 Jun 2018 Equity ratio, % 41.9 40.7 43.0 42.2 41.6 Interest cover 4.4 4.3 4.3 4.3 4.2 Loan to Value (LTV), % 1) 2) 46.9 46.7 45.9 46.2 46.7 Hedging ratio, % 89 93 94 94 92 Average interest rate, %3) 1.8 1.8 1.8 1.8 1.8 Average l
Slide 41: Important information
Important information This presentation shall not constitute an offer to sell or the solicitation of an offer to buy securitites in any jurisdiction. No part of this presentation, nor the fact of its distribution, should form the basis of, or be relied on in connection with, any contract or commitme