Lumo Homes Plc · OMXHEX:LUMO
Lumo Homes — Kojamo — FY2020 Earnings Presentation
47 slides from Lumo Homes's earnings presentation, Feb 18, 2021
Slide 1: Financial Statements Release 2020
Financial Statements Release 2020 18 February 2021 Jani Nieminen, CEO Erik Hjelt, CFO Kojamo plc
Slide 2: Agenda
Agenda • Summary of year 2020 • Financial development • Outlook, strategic targets and dividend policy Kojamo plc's Financial Statements Release 2020 2
Slide 3: Summary of year 2020
Summary of year 2020 Kojamo plc's Financial Statements Release 2020 3
Slide 4: Operating environment
Operating environment Business environment key figures 7.8 8.0 7.6 7.2 2.5 2.0 1.6 General operating environment 0.3 1.4 1.4 1.0 • The global economy is estimated to recover from the -3.3 deep slump caused by the COVID-19 pandemic in 2020E 2021E 2022E 2023E 2021, mainly on the second half of the yea
Slide 5: Operating environment
Operating environment Industry key figures 2021E 2020E Residential start-ups, units 31,000 35,000 Building permits granted, annual*, units n/a 37,372 Industry operating environment • The number of residential start-ups decreased less than Construction costs, change % 0.5 0.3 expected in last year Re
Slide 6: Operating environment
Operating environment Development of household sizes (% of all households) 45% Pandemic does not have a long-term impact on 40% the rental market 35% • In a longer term, migration keeps the demand for rental 30% apartments especially close to good connections high. 25% The significance of location a
Slide 7: Of the portfolio's fair value 98.8% in the seven largest Finnish growth centres
Of the portfolio’s fair value 98.8% in the seven largest Finnish growth centres Apartment distribution, % 4.0% 2.3% Number of 4.7% 4.9% Helsinki commercial Number of Fair Fair value Fair region premises Financial apart- value, (EUR value 6.2% Region and other occupancy Tampere ments, (EUR thousand (
Slide 8: Key figures 2020
Key figures 2020 total revenue net rental income funds from operations (FFO) 383.9 M€ 257.6 M€ 151.5 M€ (375.3 M€, +2.3%) (247.3 M€, +4.2%) (140.7 M€, +7.7%) fair value of investment profit excluding properties gross investments changes in value 1) profit before taxes 6.9 Bn€ 371.2 M€ 165.5 M€ 391.2
Slide 9: 2,624 apartments under construction
2,624 apartments under construction • During the review period, 18 (520) apartments were sold, 71 (260) acquired and 532 (816) completed • During the period, construction of 1,840 (1,066) apartments was started Development of apartment portfolio, units Apartments under construction, units +1.5% +99.
Slide 10: Our strong project pipeline supports the future growth
Our strong project pipeline supports the future growth • Over 2,600 apartments under Projects under construction construction, all in the Helsinki Lumo One, Lauri Korpisen katu 8, Työpajankatu 17A, Höyrykatu 8, Runoratsunkatu 11, region Vantaa Helsinki Helsinki Espoo • Co-operation agreements on the
Slide 11: Strong production pipeline
Strong production pipeline Under construction Co-operation agreements* Metropolia development project properties Metro track Railway track * Apartments that are a part of co-operation agreements, but have been started are listed as ’Under construction’ Q1/ Q2/ Q3/ Q4/ Estimate of completions, units*
Slide 12: Lumo builds customer experience in a new way
Lumo builds customer experience in a new way ~21,000 agreements via webstore Services of a new customer Services during tenancy Development of new rental agreements Affordable security deposit My Lumo Pets are welcome Lumo customer service Broadband included in rent Lumo janitors Sustainable interio
Slide 13: Our sustainability work is progressing
Our sustainability work is progressing • We participated the global GRESB sustainability assessment for the first time and received a good result: 70/100. With our results we earned Green Star designation and three stars out of five • In December we published our sustainability programme combining o
Slide 14: Financial development
Financial development Kojamo plc's Financial Statements Release 2020 14
Slide 15: Total revenue increased
Total revenue increased • Total revenue increased mainly due to growth of property portfolio as well as Like-for-Like rental income growth Total revenue, M€ +2.3% Profit before taxes, M€ Profit excluding Changes in value* Profit excluding changes in value changes in value 375.3 383.9 +4.2% 358.8 1,0
Slide 16: Net rental income and FFO increased
Net rental income and FFO increased • The growth was supported by the growth of apartment portfolio, Like-for-Like rental income growth and lower maintenance costs and repairs than in the comparison period Net rental income, M€ Funds From Operations (FFO), M€ +4.2% and € / share Funds From Operation
Slide 17: Occupancy rate on a good level despite of COVID-19 pandemic
Occupancy rate on a good level despite of COVID-19 pandemic • COVID-19 pandemic has temporarily had an impact on the increase of supply as well as migration Financial occupancy rate, % Tenant turnover, % excluding internal turnover 32.5 97.4 97.2 28.6 28.8 29.6 96.7 97.0 96.4 27.6 2016 2017 2018 201
Slide 18: Strong progress in investments
Strong progress in investments • Gross investments increased from previous year Gross investments and sales of Modernisation investments and investment properties, M€ repairs, M€ Gross investments Sales of investment properties Modernisation investments Repairs 696.0 -6.9% 68.4 67.6 61.0 62.9 367.3
Slide 19: The value of investments properties was EUR 6.9 billion
The value of investments properties was EUR 6.9 billion • The fair value has developed positively during the review period Fair value of investment properties, M€ 1) Number of apartments by valuation (at the end of the review period) classes (at the end of the review period) +9.6% Acquisition cost Y
Slide 20: Plot and real estate development reserve 31 Dec 2020
Plot and real estate development reserve 31 Dec 2020 To be completed during the first Owned part of 2021 Apartments Binding plots and Niittykatu 15, Vinsentinaukio 4, under preliminary development Espoo Helsinki construction agreements projects1 In total Investment / actual costs incurred 370.0 - 13
Slide 21: Equity ratio and Loan to Value (LTV)
Equity ratio and Loan to Value (LTV) • Equity ratio and Loan to Value (LTV) in line with strategic targets Equity ratio, % Loan to Value, (LTV), % 47.1 46.0 45.9 46.9 45.6 40.5 41.4 41.3 43.0 40.7 2016 2017 2018 2019 2020 2016 2017 2018 2019 2020 The share issue improved the equity ratio by 1.6 perc
Slide 22: Key figures per share improved significantly
Key figures per share improved significantly • Going forward, we will follow EPRA NRV as our principal key figure for net asset value Equity per share, € 1) EPRA NAV and NRV per share, € 1) +7.0% +7.6% EPRA NAV per share 13.39 EPRA NRV per share 17.21 12.51 16.00 16.66 15.49 9.54 11.69 8.88 11.11 8.
Slide 23: Versatile capital structure
Versatile capital structure The Group’s loan distribution Financing key figures 31 December 2020 % Average interest rate fixing period, years years 3 6 Loan portfolio 2,985 M€ 4.6 5 2.5 Average loan maturity, years 4.5 4 Bonds 3 1,688 M€ 1% 2% 0% 2 Average interest rate, % 2 Loans from financial 1.8
Slide 24: Strategic targets 2020–2023
Strategic targets 2020–2023 Key figure Actual 2020 Strategic target Annual growth of total revenue, % 2.3 4–5 Annual investments, M€ 371.2 200–400 FFO/total revenue, % 39.5 > 36 Loan to Value (LTV), % 41.4 < 50 Equity ratio, % 45.6 > 40 Net Promoter Score (NPS) 36 40 Kojamo plc's Financial Statement
Slide 25: Outlook, financial targets and dividend policy
Outlook, financial targets and dividend policy Kojamo plc's Financial Statements Release 2020 25
Slide 26: Outlook for Kojamo in 2021
Outlook for Kojamo in 2021 Kojamo estimates that in 2021, the Group’s total revenue will increase by 3–5 per cent year-on-year. In addition, Kojamo estimates that the Group’s FFO for 2021 will amount to between EUR 150–163 million, excluding non-recurring items. The outlook is based on the managemen
Slide 27: Dividend policy and dividend proposal by the Board of Directors
Dividend policy and dividend proposal by the Board of Directors Kojamo’s objective is to be a stable dividend payer Dividend proposal by the Board whose annual dividend payment will be at least 60 per of Directors cent of FFO, provided that the Group’s equity ratio is Kojamo plc’s distributable unre
Slide 28: Summary
Summary We created sustainable We succeeded especially We expect urbanisation to growth during the year: in new development continue even stronger total revenue, net rental projects during the year, after COVID-19 pandemic income and FFO and our project pipeline increased creates strong foundation f
Slide 29: Thank you!
Interim Report for January–March 2021 to be published on Thank you! 12 May 2021 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 Financial Statements Release 2020
Slide 30: Appendix
Appendix Kojamo plc's Financial Statements Release 2020 30
Slide 31: Change in the valuation technique of investment properties as at 31 December 2019
Change in the valuation technique of investment properties as at 31 December 2019 Kojamo shifted from a transaction-based valuation technique to a yield-based valuation technique in the valuation Change of its investment properties The change in the valuation technique will make the company more com
Slide 32: Strategy period 2020–2023
Strategy period 2020–2023 • Our strategy has proved to be strong, and we will continue to implement it going forward • The Board of Directors has approved updated strategic targets and focal points for 2020–2023 • We seek strong growth with optimised financing structure and profitable business throu
Slide 33: Our strategy 2020–2023
Our strategy 2020–2023 Megatrends Mission Values We create better urban housing. Urbanisation & internationalisation Happy to serve Vision Ageing population & smaller family sizes We are the property market frontrunner and the number one choice for our customers. New technologies & Strategic focal p
Slide 34: Strategic focal points 2020–2023
Strategic focal points 2020–2023 Delivering the We offer easy and effortless services We seek profitable growth with multi- best customer for our customers and create added Strong growth channel approach and optimised experience value through services financing structure We create competitiveness an
Slide 35: Our Digital Roadmap will guide us from today to year 2023
Our Digital Roadmap will guide us from today to year 2023 according to our strategy • Kojamo is a frontrunner thanks to the direct rental in its webstore. Now we will focus on Customer experience and servitisation direct rental service as the main rental channel • We will strengthen our position by
Slide 36: Our corporate responsibility is reflected in our mission of creating better urban housing
Our corporate responsibility is reflected in our mission of creating better urban housing • Responsibility and sustainable development is one of Kojamo’s strategic focal points • We published our sustainability programme on 2 December 2020 setting focal points, targets and actions for our sustainabi
Slide 37: Kojamo plc's Financial Statements Release 2020
Kojamo plc's Financial Statements Release 2020 37
Slide 38: Our sustainability programme supports the execution of our strategy
Our sustainability programme supports the execution of our strategy Ensuring long-term profitability and growth • Our sustainability programme supports Kojamo’s strategic targets for 2020–2023 as well as ensuring long-term profitability and growth Sustainable and responsible operations • Respons
Slide 39: Sustainability is visible in our every day life
Sustainability is visible in our every day life Hydro- power- -7,5% certified -3.4% Anti-grey ~101 Our goal to boost property electricity at property heating index energy consumption economy EUR million during 2017–2025, of 100% (kWh/m3) tax footprint which we have of properties models achieved exce
Slide 40: Kojamo's ten largest shareholders
Kojamo’s ten largest shareholders (as at 31 Dec 2020) Number of Development of the number Shareholder shares % of shares Nominee-registered and direct foreign of the shareholders 9,076 102,545,125 41.5 shareholders 8,273 1. The Finnish Industrial Union 24,809,561 10.0 7,185 2. Ilmarinen Mutual Pensi
Slide 41: Key figures
Key figures 10–12/2020 10–12/2019 Change, % 2020 2019 Change, % Total revenue, M€ 97.1 95.1 2.2 383.9 375.3 2.3 Net rental income, M€ 63.8 60.1 6.2 257.6 247.3 4.2 Net rental income margin, % 65.7 63.3 67.1 65.9 Profit before taxes, M€ 193.2 839.9 -77.0 391.2 1,031.3 -62.1 Gross investments, M€ 107.
Slide 42: Consolidated income statement
Consolidated income statement M€ 10–12/2020 10–12/2019 2020 2019 Total revenue 97.1 95.1 383.9 375.3 Maintenance expenses -22.4 -22.1 -90.5 -91.1 Repair expenses -10.9 -12.8 -35.8 -36.9 Net rental income 63.8 60.1 257.6 247.3 Administrative expenses -9.4 -10.4 -38.4 -38.7 Other operating income and
Slide 43: Balance sheet
Balance sheet M€ 31 Dec 2020 31 Dec 2019 ASSETS Non-current assets Intangible assets 0.4 0.2 Investment properties 6,860.7 6,260.8 Property, plant and equipment 29.8 30.9 Investments in associated companies 1.1 2.4 Financial assets 0.7 0.7 Non-current receivables 7.7 3.2 Derivatives - 0.2 Deferred t
Slide 44: Balance sheet
Balance sheet M€ 31 Dec 2020 31 Dec 2019 EQUITY AND LIABILITIES Equity attributable to shareholders of the parent company Share capital 58.0 58.0 Share issue premium 35.8 35.8 Fair value reserve -54.2 -44.7 Invested non-restricted equity reserve 164.4 164.4 Retained earnings 3,105.5 2,877.0 Equity a
Slide 45: Financial key figures
Financial key figures 31 Dec 2020 30 Sep 2020 30 Jun 2020 31 Mar 2020 31 Dec 2019 Equity ratio, % 45.6 44.1 43.3 45.3 46.9 Interest cover 4.2 4.2 4.3 4.3 4.3 Loan to Value (LTV), % 41.4 42.1 42.6 39.5 40.5 Hedging ratio, % 91 89 87 85 88 Average interest rate, %1) 1.8 1.8 1.7 1.8 1.8 Average loan ma
Slide 46: Development of housing production
Development of housing production Granted building permits, units Start-ups, units 43,945 44,376 48,722 38,424 43,269 36,877 40,432 38,076 32,127 32,402 n/a 28,000 23,474 20,938 18,739 17,960 19,498 20,694 18,857 15,310 16,248 17,371 17,257 15,127 5,597 8,232 7,109 7,919 5,129 5,044 7,943 6,745 5,71
Slide 47: 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