Eastnine Ab · OMXSTO:EAST
Eastnine Ab — Q3 2022 Earnings Presentation
23 slides from Eastnine Ab's earnings presentation, October 2022
Slide 1: Interim report January – September 2022
EASTNINE Interim report January – September 2022 1
Slide 2: Positive quarter and period
Positive quarter and period • Positive net letting for 3rd quarter in a row. • Record high profit from property management. • Top rating in GRESB. • Sustainability certifications 2022: – Valdemara Centrs: Fitwel – Nowy Rynek D and Vertas-2: Leed Platinum – S7-2 and S7-3: BREEAM In-Use Outstanding •
Slide 3: MFG sale agreement
MFG sale agreement • Sale agreement with the listed Russian investment company Sistema. • Price EUR 193m. • The agreement is subject to conditions outside Eastnine’s control, such as regulatory approvals and sanctions. • Expected completion end of 2022. • MFG continues to perform well. 3
Slide 4: Economic outlook & real estate markets
Economic outlook & real estate markets
Slide 5: Macroeconomic outlook
Macroeconomic outlook % Real GDP growth decreasing % Inflation peaking % Unemployment stable 8 20 12 18 6 10 16 4 14 8 2 12 0 10 6 8 -2 4 6 -4 4 2 -6 2 -8 0 0 2018 2019 2020 2021 2022F 2023F 2018 2019 2020 2021 2022F 2023F 2018 2019 2020 2021 2022F 2023F Latvia Lithuania Latvia Lithuania Latvia Lith
Slide 6: Prime offices
Prime offices EUR/sqm/ Rent levels increase Vacancy rates variates Prime yield stable month % % 60 20 8 7 48 16 6 5 36 12 4 24 8 3 2 12 4 1 0 0 0 2015 2016 2017 2018 2019 2020 2021 Q3 2015 2016 2017 2018 2019 2020 2021 Q3 2015 2016 2017 2018 2019 2020 2021 Q3 2022 2022 2022 Poznan Riga Vilnius Stock
Slide 7: Properties and tenants
Properties and tenants eastnine ©
Slide 8: Eastnine's property portfolio
Eastnine’s property portfolio 14 properties Riga, Latvia EUR 81m ~13 % 183,000 sq.m. Vilnius, Lithuania EUR 402m ~67 % Poznan, Poland EUR 604m EUR 121m ~20 % 8
Slide 9: Focused on sustainability
Focused on sustainability In process 11% 24% 65% 9
Slide 10: Properties in Vilnius, Lithuania
Properties in Vilnius, Lithuania CBD area Parliament district New town • Nine office properties: 121,200 sq.m. ~ 13,500 S7-1 3Bures-1,2 Vertas-1 Uptown Park sq.m. per property. • High occupancy ~94 %. • Anchor tenants: Danske Bank, Swedbank, Telia S7-2 3Bures-3 Vertas-2 and Vinted. • One development
Slide 11: Properties in Riga, Latvia
Properties in Riga, Latvia • Three office properties: 22,500 City Centre sq.m. ~ 7,500 sq.m. per property. Valdemara Centrs Project The Pine • Increasing occupancy ~84 %. • Anchor tenants: Webhelp, Klavins Ellex and Sorainen. • Two development projects: The Alojas Biroji Pine and Kimmel ~ 50,000 sq.
Slide 12: Property in Poznan, Poland
Property in Poznan, Poland • Acquired in May 2022 – Nowy Rynek D. • Modern office 39,300 sq.m. • Fully let. • Anchor tenants: Allegro, Rockwool and Arvato. 12
Slide 13: Strong international tenants
Strong international tenants Type Country Tenants City % of annual contracted rent (Industry) (HQ) 1 Allegro Poznan 15% E-commerce 2 Danske Bank Vilnius 14% Finance 3 Telia Vilnius 9% ICT 4 Swedbank Vilnius 6% Finance 5 Vinted Vilnius 6% E-commerce 6 Rockwool Poznan 3% Manufacturing 7 Visma Vilnius
Slide 14: Financial overview
Financial overview eastnine ©
Slide 15: Strong financial highlights
Strong financial highlights Q3 vs Q2 Occupancy rate Surplus ratio Property yield1 94.3 % 92 % 5.2 % +2.8 %-points +3 %-points +0.2 %-points 1 Property yield in the earning capacity excluding development properties. Net LTVP Interest coverage ratio Average interest rate 51 % 2.6 multiple 3.1 % -1 %-p
Slide 16: Income statement development
Income statement development General comment: 2022 Change 2022 Change Jul-Sep vs Jul- Jan-Sep vs Jan- Larger property portfolio. Sep 2021, Sep 2021, EURk % % Rental income 8,228 +48 21,804 +36 Quarter July-September Property expenses -636 +35 -2,154 +48 • Higher occupancy: Rental income increases mo
Slide 17: Improvement in the Earning capacity
Improvement in the Earning capacity Change vs EURk 2022-09-30 2022-06-30, % • Same property portfolio as of June 30, 2022 • Higher occupancy has reduced the vacancy value. Rental value 35,764 0 • Interest expenses increase due to a higher interest rate Less vacancy values -2,034 -33 level. • Profit
Slide 18: Stable financing structure
Stable financing structure Diversified bank financing and low capital market financing Loan maturity and interest maturity EURm, % Loan maturity 2.6 years Interest maturity 2.0 years 45% 41% BerlinHyp 40% 22% 35% 29% 28% 28% 30% Swedbank 18% 25% SEB 30% 20% 18% 17% 17% 15% OP Bank 10% 11% 10% 7% Bon
Slide 19: Share price affected by war/interest rate rise
Share price affected by war/interest rate rise Discount decreased after announcement about MFG Minor changes during 2022 Owner Share, % Change 2022,%-points SEK NAV Peter Elam Håkansson 25.9 -0.7 250 238 SEK Bonnier Fastigheter Invest 13.7 0.0 Arbona 10.0 0.0 200 Lazard Asset Mgmt 4.9 -0.6 Kestutis
Slide 20: Why Eastnine?
Why Eastnine? eastnine ©
Slide 21: Key figures per share
Key figures per share Profit property Dividend/share Long-term equity/share EUR management/share SEK EUR 0.8 3.5 25 0.73 21.9 3.0 3.0 0.7 3 2.7 20 0.6 17.6 2.5 2.3 0.5 0.47 14.6 0.43 15 13.1 2 0.4 11.4 1.5 10 0.3 0.26 0.2 1 0.14 5 0.1 0.5 0 0 0 2018 2019 2020 2021 2022* 2018 2019 2020 2021 2018 2019
Slide 22: An investment in Eastnine
An investment in Eastnine 1. Unique portfolio 2. Strong cash generation • Modern office property portfolio in prime locations. • High property yield compared to the Nordics. • Geographic focus: Baltics and Poland. • Strong, international tenants with long leases. 3. Leading in sustainability 4. Grow
Slide 23: Thank you!
Thank you! eastnine ©