Samhallsbyggnadsbolaget I Norden Ab Class B · OMXSTO:SBB_B
Samhallsbyggnadsbolaget I Norden Ab Class B — Investor Presentation (July 2019)
34 slides from Samhallsbyggnadsbolaget I Norden Ab Class B's investor presentation, Jul 15, 2019
Slide 1: Creating the Leading Nordic Social Infrastructure Property Company
CREATING THE LEADING NORDIC SOCIAL INFRASTRUCTURE PROPERTY COMPANY July 2019
Slide 2: Disclaimer
DISCLAIMER IN REVIEWING THIS PRESENTATION AND ITS CONTENTS, YOU ARE AGREEING TO ABIDE BY THE TERMS OF THIS DISCLAIMER. THIS PRESENTATION AND ITS CONTENTS ARE BEING MADE AVAILABLE TO EACH RECIPIENT SOLELY FOR ITS INFORMATION AND IS SUBJECT TO AMENDMENT. If you are not the intended recipient of this p
Slide 3: Today's Presenters
TODAY’S PRESENTERS Ilija Batljan Oscar Lekander Rosel Ragnarsson CEO Business Development Head of Finance Manager • Education: PhD in Social Work • Education: Master in Property • Education: Degree in Economics, (demographics, health care and and Finance, University of Hong Uppsala University long t
Slide 4: I. Introduction to SBB
I. Introduction to SBB
Slide 5: SBB – Creating the Leading Nordic Social Infrastructure Property Company
SBB – ‘CREATING THE LEADING NORDIC SOCIAL INFRASTRUCTURE PROPERTY COMPANY’ Key pillars of SBB’s story Portfolio has grown from SEK 7.6bn to SEK 30bn+ over 2.5 years… Unique and non-replicable long-term relationships with municipalities 30.3 GAV (SEKbn) 25.6 21.1 7.6 SEK 30bn low-risk social infr
Slide 6: SBB at a Glance
SBB AT A GLANCE Key figures Portfolio overview Property split by type SEK 30.3bn 790 4.7% Community Services 7 years Portfolio value # assets WAULT1 Net initial yield2 Regulated Residential Other 7% 93% SEK Social infrastructure of 34% which 59% community Total social 30.3bn 59% infrastructure: serv
Slide 7: Low-Risk Yielding Portfolio Underpinning Development & Transaction Activities
LOW-RISK YIELDING PORTFOLIO UNDERPINNING DEVELOPMENT & TRANSACTION ACTIVITIES Backed by SBB’s strong relationship with Nordic municipalities, SBB offers a distinctive opportunity, unlike any competitor, to invest in community service and regulated residential properties, supported by predictable cas
Slide 8: Non-Replicable Relationship with Municipalities Driving Shareholder Returns
NON-REPLICABLE RELATIONSHIP WITH MUNICIPALITIES DRIVING ATTRACTIVE SHAREHOLDER RETURNS THROUGH A COMBINATION OF RECURRING INCOME STREAMS Income from property management Income from social infrastructure building rights Income from development of building Stable and low-risk rental income from ri
Slide 9: II. Investment Highlights
II. Investment highlights
Slide 10: Investment Highlights
INVESTMENT HIGHLIGHTS Differentiated strategy of focusing on low risk social infrastructure offering attractive yields, underpinned by 1 strong relationships with municipalities Rent-regulated residential portfolio ensures low tenant turnover and income stability with significant 2 value upside 3 Ad
Slide 11: Community Services Properties Are Core to the Business and a Unique Asset Class
COMMUNITY SERVICES PROPERTIES ARE CORE TO THE BUSINESS AND A TRULY UNIQUE ASSET 1 CLASS TO SBB This unique asset class is defined by low risk publicly financed tenants, long leases with low tenant turnover, high demand and attractive lease terms Low risk municipality and A B Attractive lease terms g
Slide 12: SBB's Unique and Long Term Relationship with Municipalities Supports Portfolio Growth
SBB’S UNIQUE AND LONG TERM RELATIONSHIP WITH MUNICIPALITIES SUPPORTS CONTINUED 1 PORTFOLIO GROWTH AND UPSIDE Long term reliable partner for municipalities Opportunity to increase market share Owned by SBB’s market private Long history of actively working with several <1 share less 8 out of 10 so
Slide 13: SBB Operates in the Attractive Swedish Residential Rental Markets
2 SBB OPERATES IN THE ATTRACTIVE SWEDISH RESIDENTIAL RENTAL MARKETS Growth in Swedish residential properties Regulated Swedish residential market Rents in the Swedish residential market are regulated '000 160 It is based on the ‘Utility Value System’ of the apartment and negotiations between the
Slide 14: Rent-Regulated Residential Properties in Swedish Growth Municipalities
2 RENT-REGULATED RESIDENTIAL PROPERTIES IN SWEDISH GROWTH MUNICIPALITIES Key portfolio figures Distribution by region Northern Key regions SEK 10.2bn SEK 701m SEK 380m 94.6% Sweden Gothenburg 1% portfolio value Passing rent Passing NOI Occupancy1 5% Greater Dalarna Stockholm 20% 20% ~7.1% ~3.9% 720k
Slide 15: Residential Portfolio Provides Growth and Value Enhancing Opportunities
RESIDENTIAL PORTFOLIO PROVIDES SIGNIFICANT GROWTH AND VALUE ENHANCING 2 OPPORTUNITIES THROUGH A RANGE OF ACTIVE ASSET MANAGEMENT INITIATIVES 1,742 New-build Rent (SEK/sqm) Only Swedish rent regulated residential units1 apartment rents in 975 2 Sweden are above Focus on cities with favorable de
Slide 16: Additional Income Streams Due to Unique Relationship with Municipalities
ADDITIONAL INCOME STREAMS DUE TO UNIQUE AND NON-REPLICABLE RELATIONSHIP WITH 3 MUNICIPALITIES Differentiating Income Streams Income from renovations Income from social infrastructure building rights Income from transactions | 16
Slide 17: Income from Renovations: Unique Residential Renovation Business Model
INCOME FROM RENOVATIONS: 3 UNIQUE RESIDENTIAL RENOVATION BUSINESS MODEL Unique residential renovation business model in Sweden Renovation process Apartment type Apartment points ■ In Sweden regulated residential rents are set through a negotiation process with the Union of Tenants where a 1 room and
Slide 18: Income from Renovations: Significant Value Upside Potential
INCOME FROM RENOVATIONS : 3 SIGNIFICANT VALUE UPSIDE POTENTIAL Significant development opportunity from existing portfolio Case studies ■ SBB’s residential portfolio comprises 8,600 apartments with a capital value of SEK 13,700 Motala per sqm1 ■ SBB has renovated 248 apartments2 over first two quart
Slide 19: Income from Social Infrastructure Building Rights: Active Approach to Creating Risk-Adjusted Value
INCOME FROM SOCIAL INFRASTRUCTURE BUILDING RIGHTS: 3 ACTIVE APPROACH TO CREATING RISK-ADJUSTED VALUE SBB's role in the residential development process Case study – Sale of building rights and JV Value growth Falkenberg Bacchus 1 - Two sales of building rights Financial risk 58,000 sqm total buildi
Slide 20: Income from Building Rights: Current Development Portfolio Offers Potential Upside
INCOME FROM SOCIAL INFRASTRUCTURE BUILDING RIGHTS: 3 CURRENT DEVELOPMENT PORTFOLIO OFFERS POTENTIAL UPSIDE Social infrastructure property development portfolio Building rights sales value achieved Total rights area split (sqm) Area Value Value per sqm Total rights area Book value Value per sqm Right
Slide 21: Income from Transactions: Track Record and Case Studies
INCOME FROM TRANSACTIONS: 3 TRACK RECORD AND CASE STUDIES Case Study - Karlskronahem Highlights 13,470 ■ In 2018 SBB acquired two Total acquisitions (SEKm) residential and two community services properties from the 8,864 municipality of Karlskrona Acquisitions1 ■ Portfolio was acquired for SEK 366m
Slide 22: Strong Balance Sheet Position and Attractive Funding Mix
4 STRONG BALANCE SHEET POSITION AND ATTRACTIVE FUNDING MIX Long-dated maturity profile1 Accelerating deleveraging secured an IG rating for SBB SEKm LTV2(%) 57% 63% 63% 63% of the debt portfolio equal 62% 61% 59% 58% 56% to or longer than 4 years 39% 60% 60% 59% 58% 59% 59% 56% 17% 18% 53% 52% 16% 43
Slide 23: Strong Management Team and BoD
5 STRONG MANAGEMENT TEAM AND BOD Active and hands-on management team with exceptional experience and track-record Ilija Batljan Lars Thagesson Krister Karlsson Eva-Lotta Stridh CEO Deputy CEO and COO Deputy CEO and Head CFO of Property development 21 years in industry 44 years in industry 30 years i
Slide 24: III. Financial Highlights
III. Financial highlights
Slide 25: Unprecedented Growth and Shareholder Value Creation
UNPRECEDENTED GROWTH AND SHAREHOLDER VALUE CREATION Solid underlying financial performance… …translating into strong growth in EPRA NAVps …delivering solid ROE1 LTM NOI LTM NOI Margin 18% 18% 17% 1,127 17% 1,055 1,071 1,078 16% 1,025 12.13 12.69 11.24 11.55 66% 65% 64% 63% 64% 10.61 Q2-18 Q3-18 Q4-1
Slide 26: Key Financial Highlights
KEY FINANCIAL HIGHLIGHTS Portfolio Level KPI Key Operating Items Portfolio Value and Balance Sheet Leasable area LTM Gross rental income Property value 1,797 k sq.m. SEK 1,773m SEK 30,331m 864 k sq.m. 720 k sq.m. 213 k sq.m. SEK 1,011m SEK 573m SEK 189m SEK 17,854m SEK 10,182m SEK 2,295 Value per sq
Slide 27: IV. Green Initiatives
IV. Green initiatives
Slide 28: Supporting the Transition Towards a More Sustainable World
SUPPORTING THE TRANSITION TOWARDS A MORE SUSTAINABLE WORLD Focus on reducing CO2 within the property portfolio Environmental initiatives employed SEKm Portfolio CO2 emissions (tons/year) Power consumption A definite environmental perspective 6,864 6,639 Domestic hot water should permeate all of SB
Slide 29: Sustainable Financing Sources
SUSTAINABLE FINANCING SOURCES By setting up a green bond framework, aligned with the Green Bond Principles published in June 2018 by the International Capital Market Association, SBB offers investors further insights into the company’s sustainability strategy and commitments and thereby an opportu
Slide 30: Thank You!
THANK YOU! SBB Samhallsbyggnadsbolaget @D »
Slide 31: Appendix – Supporting Materials
Appendix – Supporting materials
Slide 32: Capital Structure Overview
CAPITAL STRUCTURE OVERVIEW Overview of existing financing as of 30-Jun-2019 Commentary SEKm Carrying Value As of Q2 2019 the company had unutilised credit facilities totaling SEK 3,200m and cash and cash equivalents of SEK 2,691m Current interest bearing liabilities Commercial Paper 2,718 During
Slide 33: Strong In-House Capabilities
STRONG IN-HOUSE CAPABILITIES CEO Legal, IT and Investor Relations Management (outsourced) Finance and accounting Property management Property development Refurbishment and Business Capital markets Accounting Asset management sustainability development Consolidated Region North Analysis & accounting
Slide 34: Example of Partnership with Municipalities - Skellefteå Municipality
EXAMPLE OF PARTNERSHIP WITH MUNICIPALITIES - SKELLEFTEÅ MUNICIPALITY Comments Summary Established a partnership with the municipality of Skellefteå regarding a new culture Number of properties 1 house and including a congress hall Skellefteå is one of the richest municipalities in Sweden and hav
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