Lumo Homes Plc · OMXHEX:LUMO
Lumo Homes — Kojamo — H1 2024 Earnings Presentation
44 slides from Lumo Homes's earnings presentation, Aug 15, 2024
Slide 1: Half-Year Report 1–6/2024
15 August 2024 Half-Year Report 1–6/2024 Jani Nieminen, CEO Erik Hjelt, CFO Kojamo plc
Slide 2: Agenda
Agenda • Summary of January–June 2024 • Financial development • Outlook and financial targets Kojamo plc's Half-Year Financial Report January−June 2024 2
Slide 3: Summary of January–June 2024
Summary of January–June 2024 Kojamo plc's Half-Year Financial Report January−June 2024 3
Slide 4: Total revenue and net rental income increased, renting impacted by abundant supply
Total revenue and net rental income increased, renting was impacted by the continued abundant supply on the market • Total revenue and net rental income increased in the first half of the year • Financial occupancy rate decreased from the comparison period • There is still plenty of supply on the ma
Slide 5: Operating environment
Operating environment General operating environment Operating environment key figures • The outlook for the global economy is improving as 2024E 2023 inflation is slowing and real incomes are growing GDP growth, % 0.0 -1.0 • Strong economic growth in the United States continues. Unemployment, % 7.9
Slide 6: Operating environment
Operating environment Housing production Industry key figures • The number of residential start-ups plummeted last year. The residential start-ups for non-subsidised 2024E 2023 block-of-flats has fallen by 20,000 apartments from the Residential start-ups, units 16,500 17,500 peak years of which non-
Slide 7: Operating environment
Operating environment The rental market situation • There is still oversupply in the market which will decrease Population growth forecast 2022–2040, % as urbanisation continues and the new supply declines Helsinki 22.4 sharply Capital region* 25.9 • Urbanisation and decreasing average household siz
Slide 8: Key figures 1–6/2024
Key figures 1–6/2024 total revenue net rental income funds from operations (FFO) 225.6 M€ 142.7 M€ 68.2 M€ (217.1 M€, +3.9%) (138.5 M€, +3.0%) (80.5 M€, -15.3%) fair value of investment profit excluding changes in gross investments value 1) profit/loss before taxes properties 7.9 Bn€ 19.3 M€ 73.9 M€
Slide 9: Lumo – Easily best living
Lumo – Easily best living Basic functions Lumo Service Center Real estate development My Lumo service Maintenance Homes for Sales Cleaning various life Lumo webstore Renovations and repairs stages Building management Waste management Technical management Fixed customer benefits Customer benefits Bro
Slide 10: Our roadmap towards carbon neutrality
Our roadmap towards carbon neutrality • We are committed to carbon-neutral energy use in our properties by 2030 • Our goal is to reduce carbon dioxide emissions by 5% annually until the end of 2025 • Our property electricity is 100% carbon neutral Kojamo plc's Half-Year Financial Report January−June
Slide 11: Financial development
Financial development Kojamo plc's Half-Year Financial Report January−June 2024 11
Slide 12: Total revenue and net rental income increased
Total revenue and net rental income increased • Total revenue increased due to the growth of property portfolio but was weakened by the development of rents and the financial occupancy rate • Net rental income was positively impacted by higher total revenue and lower repair expenses and negatively i
Slide 13: Profit before taxes and FFO
Profit before taxes and FFO • Profit before taxes decreased from the comparison period • FFO decreased compared to the comparison period, which was particularly affected by higher financial and maintenance expenses. Financial income of the comparison period includes a profit of EUR 8.9 million from
Slide 14: Financial occupancy rate decreased from the comparison period
Financial occupancy rate decreased from the comparison period • Financial occupancy rate was 91.7 (92.2) per cent for the review period • Tenant turnover increased from the previous year’s level • During the first half of the year, renting was impacted by seasonal variation and the abundant supply o
Slide 15: Development of Like-for-Like rental income
Development of Like-for-Like rental income The past 12 months compared to the previous 12-month period Development of Like-for-Like rental income as at 30 June 2024 +0.2% -0.2% +0.9% +0.9% Impacts of Impact of Other Like-for-Like rents and water charges occupancy rate impacts rental income growth Ko
Slide 16: As a part of the saving programme, investments decreased substantially
As a part of the saving programme, investments decreased substantially • We will not make new investments nor will we launch modernisation projects for the time being • The last ongoing development project was completed in June • We will focus repairs to support renting of apartments Gross investmen
Slide 17: The value of investment properties was EUR 7.9 billion
The value of investment properties was EUR 7.9 billion Changes in fair value • Valuation yield requirements of the investment M€ 1–6/2024 1–6/2023 properties were increased on average by 0.1 Change in yield requirement -165.9 - percentage points during the second quarter Change in net rental income
Slide 18: Equity ratio and Loan to Value (LTV) at a strong level
Equity ratio and Loan to Value (LTV) at a strong level • Equity ratio and Loan to Value (LTV) have remained strong • Moody’s affirmed Baa2 rating in December 2023. There’s a significant buffer to LTV limit of 50 per cent Equity ratio, % Loan to Value (LTV), % 43.7 44.6 43.8 45.0 49.0 41.4 45.6 45.3
Slide 19: Loans maturing in 2024 and 2025 are covered
Loans maturing in 2024 and 2025 are covered • In January, we issued a new EUR 200 million bond • In March, we signed a new EUR 250 million secured term loan facility agreement • In June, the bond we issued in 2017 was repaid. The outstanding amount of the bond at maturity was EUR 434.5 million The G
Slide 20: Key figures per share
Key figures per share • Key figures per share did not change significantly from the year-end Equity per share, € EPRA NRV per share, € -6.2% -6.9% 22.04 19.53 19.50 18.45 18.16 17.25 17.21 15.55 14.67 15.46 14.50 13.39 2020 2021 2022 2023 30 Jun 30 Jun 2020 2021 2022 2023 30 Jun 30 Jun 2023 2024 202
Slide 21: Outlook and financial targets
Outlook and financial targets Kojamo plc's Half-Year Financial Report January−June 2024 21
Slide 22: Outlook for Kojamo in 2024
Outlook for Kojamo in 2024 Kojamo reiterates its outlook issued on July 15, 2024, in which Kojamo estimates that in 2024, the Groupʼs total revenue will increase by 2–4 per cent (previously 4–7 per cent) year-on-year. In addition, Kojamo estimates that the Group’s FFO for 2024 will amount to between
Slide 23: Strategic targets
Strategic targets M€ 1–6/2024 2023 2022 2021 2020 Target Annual growth of total revenue, % 3.9 7.0 5.5 2.0 2.3 4–5 Annual investments, M€ 19.3 190.7 501.6 356.9 371.2 200–400 FFO/total revenue, % * 30.2 37.8 38.9 39.1 39.5 > 36 Loan to Value (LTV), % 45.0 44.6 43.7 37.7 41.4 < 50 Equity ratio, % 43.
Slide 24: Summary
Summary Total revenue and net rental Occupancy rate weakened Balance sheet is strong, income increased from previous year. The and our financial key oversupply situation of the figures and liquidity FFO decreased due to market did not start to situation have remained increased financial and dissipat
Slide 25: Thank you!
Interim Report for January-September 2024 Thank you! to be published on 7 November 2024 Contact details: CEO Jani Nieminen, tel. +358 20 508 3201 CFO Erik Hjelt, tel. +358 20 508 3225 Director, Treasury & Investor Relations Niina Saarto, tel. +358 20 508 3283 www.kojamo.fi Kojamo plc's Half-Year Fin
Slide 26: Appendix
Appendix Kojamo plc's Half-Year Financial Report January−June 2024 26
Slide 27: Saving programme
Saving programme • We launched a saving programme in August 2023 which aims to achieve total savings of EUR 43 million in costs and investments in 2024, of which the share of costs is estimated to be EUR 18 million • The measures of the programme aim at maintaining the company’s profitability and sa
Slide 28: Immigration and its impact
Immigration and its impact • Both migration within the country and immigration that has increased in the 2020s will advance urbanisation • Immigration is heavily focused on the capital region and other large cities • Number of immigrants from Asia has nearly tripled in last two years and continues o
Slide 29: Kojamo's apartment portfolio
Kojamoʼs apartment portfolio Apartment distribution, % Fair value distribution, % Helsinki region 2.5 2.5 3.5 4.5 3.1 2.2 4.1 Tampere region 3.0 5.0 Turku region 4.3 5.4 Oulu 8.6 5.2 Jyväskylä 9.6 62.7 Kuopio region Lahti region 73.9 Others Number of Number of commercial and Financial apartments, ot
Slide 30: Housing stock and customer distribution
Housing stock and customer distribution • Kojamo’s housing stock meets the demand nicely • All age groups are well represented among the tenants Housing stock by apartment Customers by household Customers by age group, % type, % type, % 5.0 3.3 3.3 10.9 studios 12.6 1 person 14.7 24.0 <25 22.0 2 per
Slide 31: Our strategy
BH Our strategy Mission We create better urban living. Urbanisation & internationalisation Strategic focal points Vision + Delivering the best + The most competent We are the property market frontrunner customer experience personnel and a dynamic and the number one choice + Strong growth workplace f
Slide 32: Strategic focal points
Strategic focal points Delivering the We offer easy and effortless services We seek profitable growth with best customer for our customers and create added Strong growth multi-channel approach and experience value through services optimised financing structure Responsibility We create competitivenes
Slide 33: Topical with our sustainability work
Topical with our sustainability work • In February, we updated our Green Finance Framework to align future financing activities with market best practices and standards • We are implementing an AI-powered sustainability and energy management system which provides up-to-date information to support de
Slide 34: Key figures of sustainability 1–6/2024
Key figures of sustainability 1–6/2024 1-6/2024 1-6/2023 Target 1-6/2024 1-6/2023 Target CO₂ emissions -12.7 -12.5 -5.0 Percentage of 87 84 90 per apartment, customers using tCO₂e/apartment, My Lumo, % change % * NPS 53 52 48 Heat index of portfolio, 1.3 n/a -3.0 weather-nomalized, kWh/m³, change %
Slide 35: Sustainability is visible in our every day life
Sustainability is visible in our every day life Kojamo plc's Half-Year Financial Report January−June 2024 35
Slide 36: Sustainability commitments and reporting
Sustainability commitments and reporting Our sustainability Our sustainability reporting and Our commitments recognitions memberships Our target is carbon- We participated in the global neutral energy use in our 78/100 GRESB sustainability properties by 2030 assessment We are committed to We are a m
Slide 37: Dividend policy
Dividend policy Kojamo’s objective is to be a stable Dividend history dividend payer whose annual dividend payment will be at least 60 per cent of FFO, provided that the Group’s equity 60% 60% 61% 60% ratio is 40 per cent or more and taking account of the company’s financial 0.37 0.38 0.39 0.34 posi
Slide 38: Kojamo's ten largest shareholders
Kojamoʼs ten largest shareholders (as at 30 June 2024) Number of Shareholder shares % of shares Development of the number of the Nominee-registered shareholders 79,984,100 32.4 shareholders 1. Heimstaden Bostad AB 49,389,283 20.0 2. Ilmarinen Mutual Pension Insurance Company 20,537,814 8.3 15,361 14
Slide 39: Key figures
Key figures 4–6/2024 4–6/2023 Change, % 1–6/2024 1–6/2023 Change, % 2023 Total revenue, M€ 112.3 108.9 3.1 225.6 217.1 3.9 442.2 Net rental income, M€ 82.1 79.0 3.9 142.7 138.5 3.0 297.2 Net rental income margin, % 73.1 72.6 63.3 63.8 67.2 Profit/loss before taxes, M€ -104.3 71.7 -245.5 -65.0 95.7 -
Slide 40: Consolidated income statement
Consolidated income statement M€ 4–6/2024 4–6/2023 1–6/2024 1–6/2023 1–12/2023 Total revenue 112.3 108.9 225.6 217.1 442.2 Maintenance expenses -24.4 -22.0 -71.1 -64.4 -115.7 Repair expenses -5.8 -7.9 -11.8 -14.2 -29.3 Net rental income 82.1 79.0 142.7 138.5 297.2 Administrative expenses -10.4 -12.0
Slide 41: Balance sheet
Balance sheet M€ 30 Jun 2024 30 Jun 2023 31 Dec 2023 Non-current assets Intangible assets 0.5 0.6 0.6 Investment properties 7,921.3 8,268.1 8,038.8 Property, plant and equipment 27.7 28.2 28.0 Investments in associated companies 2.2 1.4 2.0 Financial assets 0.8 0.7 0.8 Non-current receivables 6.4 6.
Slide 42: Balance sheet
Balance sheet M€ 30 Jun 2024 30 Jun 2023 31 Dec 2023 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 19.5 41.8 11.2 Invested non-restricted equity reserve 164.4 164.4 164.4 Retained earnings 3,305.1 3,521.8
Slide 43: Financial key figures
Financial key figures 30 Jun 2024 31 Mar 2024 30 Dec 2023 30 Sep 2023 30 Jun 2023 Equity ratio, % 43.0 44.3 44.5 45.0 45.3 Interest cover 2.7 3.0 3.2 3.4 3.6 Coverage ratio 2.8 3.3 3.6 3.9 4.1 Loan to Value (LTV), % 45.0 44.5 44.6 44.3 43.8 Hedging ratio, % ¹⁾ 78 94 93 86 86 Average interest rate, %
Slide 44: 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