Slide 1: Interim presentation
Interim presentation 25 October, 2018 Anders Nissen, CEO Liia Nõu, CFO
Slide 2: Continued profitable growth
Continued profitable growth 1 Profitable acquisitions in new large markets 20% R12M 2 Good development in Brussels Return on equity2 3 Stable demand in the hotel market 31% 30% 2% 1% 4% 10% Q3 9m Q3 9m Q3 9m Growth in total LFL growth in NOI LFL growth in NOI net operating income1 Property Managemen
Slide 3: Solid increase in total net operating income
Solid increase in total net operating income Based on a combination of factors + Strong performance in the UK and Ireland + Good growth in Brussels + Stable underlying demand in the hotel market Net +200m Q3 2018 - Slightly weaker September than expected Net +523m - Some negative renovation effects
Slide 4: Focus on profitable growth (R12M)
Focus on profitable growth (R12M) Continously high business tempo reflected in earnings OUTCOME (R12M) 3 500 3 000 2,899 2 500 2 000 +1.9x 1,891 1,505 1 500 +2.1x 1 000 894 500 Total net operating income Total cash earnings 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2015 2016 2017 2018 PANDOX –
Slide 5: Portfolio overview
Portfolio overview Well-diversified portfolio dominated by revenue-based leases Pandox Property Operator Group Management Activities 143 128 15 Hotel properties Leased properties Operated properties 31,655 29,945 4,710 Rooms Rooms Rooms 86% 14% Property market value Property market value SEK 53.3bn
Slide 6: The world of Pandox
The world of Pandox 2% ✓ 143 hotels ✓ 31,655 rooms 48% ✓ 15 countries 18% ✓ 83 destinations ✓ +20 brands 32% The circles illustrate market value by region as of 30 September 2018 (rounded percentages) PANDOX – EXCELLENCE IN HOTEL OWNERSHIP & OPERATIONS 6
Slide 7: Radisson Blu Glasgow
Radisson Blu Glasgow Premium hotel property in downtown Glasgow ✓ 247 rooms ✓ Acquisition price MGBP 39 ✓ Yield of approx. 7.0 percent ✓ Well-invested product ✓ Operator Activities 7
Slide 8: The Midland Manchester
The Midland Manchester Landmark hotel property in the heart of Manchester ✓ 312 rooms ✓ Acquisition price MGBP 102 ✓ Yield of approx. 5.7 percent ✓ Strong potential ✓ Property Management 8
Slide 9: Hotel Hubert Brussels
Hotel Hubert Brussels New lifestyle concept off to a good start ✓ 100 rooms ✓ Product development/rebranding ✓ MEUR 3.4 investment ✓ High expected ROI ✓ Operator Activities 9
Slide 10: A broad selection of operators and brands
A broad selection of operators and brands PANDOX – EXCELLENCE IN HOTEL OWNERSHIP & OPERATIONS
Slide 11: Positive growth in most countries (RevPAR Q3 y/y)
Positive growth in most countries (RevPAR Q3 y/y) Europe (RevPAR) Selected countries (RevPAR) 8% 9% 8% 7% 8% 7% 7% 6% 7% 6% 6% 5% 5% 5% 5% 4% 4% 4% 3% 3% 3% 3% 2% 2% 2% 2% 1% 1% 0% 0% 0% -1% Q3 2017 Q2 2018 Q3 2018 Q1 2018 Q4 2017 -1% -2% Denmark Germany Sweden UK Ireland Finland Norway Austria Sour
Slide 12: Some growth variations in key markets (RevPAR Q3 y/y)
Some growth variations in key markets (RevPAR Q3 y/y) Key markets (RevPAR) Stockholm (RevPAR) 14% 12% 6% 12% 11% 5% 5% 10% 4% 4% 8% 3% 6% 4% 2% 4% 3% 1% 2% 2% 1% 0% 0% -1% -2% -1% -2% -2% -4% -3% -3% -3% -6% -4% -6% -4% -8% -5% Q3 2017 Q2 2018 Q1 2018 Q3 2018 Q4 2017 Copenhagen Berlin Frankfurt Hels
Slide 13: Financial highlights
Financial highlights Strong earnings growth Key figures Comments on the quarter Q3 Q3 chg FY Property Management: LFL1 increase in (MSEK) 2018 2017 % 2017 revenue and net operating income of Revenue 2 percent respectively Property Management (Note 1) 810 589 38 2,202 Net operating income Operator Ac
Slide 14: Financial expense
Financial expense More loans in foreign currencies Financial expense Loan portfolio Interest rate swap portfolio Interest rate (Q3’18 vs Q3’17) (End Q3’18 vs end Q3’17) (End Q3’18 vs end Q3’17) (End Q3’18 vs end Q3’17) 27,513 GBP 19% 20,034 21,540 Other gross 15% 18,698 Other 21% -207 SEK 16,454 26,
Slide 15: Good growth and strong profitability
Good growth and strong profitability Property Management Net operating income Rental income July-September 2018 in % Q3 Q3 FY (MSEK) 2018 2017 2017 Sweden 5% Rental income 766 569 2,121 UK 1% Germany 8% Other property income 44 20 81 Finland 30% Costs* -112 -78 -321 Denmark 9% Norway Net operating i
Slide 16: Brussels continues to drive earnings growth
Brussels continues to drive earnings growth Operator Activities Net operating income Revenues July-September 2018 in % Q3 Q3 FY (MSEK) 2018 2017 2017 Belgium 7% 2% Revenue 531 463 2,067 Canada Costs -429 -373 -1,743 Germany UK 39% Gross Profit 102 90 324 25% 40 39 170 Finland Add: Depreciation inclu
Slide 17: Property portfolio
Property portfolio Some yield compression in the quarter Change in value (MSEK) Comments per 30 September, 2018 Total property portfolio market value amounted to MSEK 53,281 (50,121) Average valuation yield for Investment Properties was 5.54 (5.57) percent and for Operating Properties 6.74 (7.27) pe
Slide 18: Financing and capital structure
Financing and capital structure Sustained growth in EPRA NAV and maintained financial flexibility Liquid funds and long-term unutilised EPRA Net Asset Value (MSEK) Loan to value (%) credit facilities (MSEK) EPRA NAV per share, SEK Renewed mandate from the AGM 2018 to issue new shares up to a maximum
Slide 19: The main drivers for growth in cash earnings
The main drivers for growth in cash earnings Opportunistic acquisitions Operations Portfolio investments Quality portfolio Market growth Organic growth PANDOX – EXCELLENCE IN HOTEL OWNERSHIP & OPERATIONS 19
Slide 20: Q&A
Hotel Hubert Brussels Q&A 20
Slide 21: Head office
Head office Pandox AB (publ) Box 15 SE-101 20 Stockholm Sweden Visiting address Vasagatan 11 Stockholm Sweden Tel: +46 8 506 205 www.pandox.se Org.nr. 556030-7885 Forward-looking statements. This presentation contains forward- looking statements. Such statements are subject to risks and uncertaintie