Technopolis presentation Q2/2015
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- The company had a strong second quarter performance in 2015 with occupancy remaining high at 94.1%, net sales up 11.3% and EBITDA up 17.8%. - Non-recurring income provided an additional EUR 5.4 million from early lease terminations. - The modernization program is now complete and will no longer negatively impact property values, with investments in concepts and infrastructure continuing. - The company is sticking to its 2015 guidance for 4-6% net sales growth and 5-7% EBITDA growth.
Technopolis presentation Q2/2015
- 1. Results for 1-6/2015 August 20, 2015
- 2. 20.8.2015 2 Q2 in Brief A Strong Performance Occupancy remained strong at 94.1* (93.5)% Net sales up 11.3% & EBITDA up 17.8% EBITDA margin at 56.4 (53.3)% Service revenues up 18.1% Non-recurring income of EUR 5.4 million Strong cash of EUR 98.7 million *) 10,000 m² under renovation and 8,500 m² of unoccupied but rented space
- 3. 20.8.2015 3 Non-Recurring Income New Opportunities from EarlyTerminations Total revenue impact EUR +5,4 million Penalties amounts to 50% of contract value 30,000 m² freed up 11,400 m² (38%) already resold Available space 18,600 m² (62%) Good prospect base for the rest
- 4. 20.8.2015 4 Changes in FairValues Modernization & Concept Program Now Complete Modernization program now complete & will no longer negatively impact fair values Direct correlation with OCR, customer satisfaction, sales & earnings demonstrated Investments in infra & concept will continue but will be FV neutral or positive MarketYield Related Occupancy Assumption Modernization Projects in Progress Total Finland 3.3 0.6 -15.6 0.5 -12.1 Baltic Rim -0.7 -0.2 -3.1 5.9 5.3 Scandinavia 1.2 - -2.4 - -2.7 Total 3.8 0.4 -21.1 1.4 -9.5 Changes in EUR million
- 5. 20.8.2015 5 Concept Investments Concept investments of EUR 4.9 million in since 2014 Covers restaurants, public areas, signage, conference space, receptions etc. Minimum standards key to creation of authentic chain operation & scale advantages Before After Campus: Ohjelmakaari 10 , Jyväskylä, Finland
- 6. 20.8.2015 6 Group Financial Occupancy 80% 85% 90% 95% 100% 10Yr. Avg. 94.8% Q2/15 94.1%
- 7. 20.8.2015 7 Unit Occupancy 91,9% 88,1% 95,9% 98,6% 94,0% 94,9% 96,1% 100,0% 95,0% 90,8% 91,4% 90,4% 97,2% 97,1% 92,5% 96,0% 99,8% 100,0% 99,1% 81,3% 80% 85% 90% 95% 100% Q2-2014 Q2-2015
- 8. 20.8.2015 8 Area Name m² EUR million Stabilized yield, % Financial OCR/ Pre -OCR, % Completion Tallinn Löötsa 8A 7,500 11.8 9.1 98.6 9/2014 St. Petersburg Pulkovo 2 18,700 42.0 12.6 99.2 9/2014 Tallinn Löötsa 5 9,200 17.0 8.8 72.3 10/2015 HMA VantaaG 5,300 18.3 8.0 88.5 9/2015 Tampere Yliopist. 3&4 11,900 39.0 7.2 35.8 5/2016 Vilnius Delta 21,600 35.4 9.8 49.5 12/2016 Organic Growth Projects Projects in progress total of EUR 109.7 million Note:As of August19, 2015. Projects in grey are not completed i.e. financial occupancy is pre-let rate
- 9. 20.8.2015 9 Financing A Big Cash Surplus Q2/2015 2014 2013 Average interest rate, % 2.63 2.43 2.46 Capital weighted loan maturity, years 6.2 6.1 7.0 Interest bearing debt, EUR million 917.2 841.9 861.9 Fixed rate, % 73.5 60.0 49.7 Interest cover ratio, % 4.4 4.8 5.3 Loan to value, % 63.1 59.7 59.5 Cash and equivalents, EUR million 98.7 28.3 54.1 Still very low interest rate Loan-to-value to decrease and equity ratio to increase in Q3 EUR 22 million will be used for repayments in Q3
- 10. 20.8.2015 10 2015 Strategy Review Focus on the West The overall strategy remains unchanged We will focus acquisitions on Scandinavia We will prioritize Stockholm and Copenhagen
- 11. 20.8.2015 11 2015-2020 Strategic FinancialTargets Average net sales and EBITDA 10% p.a. (previously 15%) Service penetration at least 15% by 2020 (2014 penetration: 10.5%)* 5.5% return on capital employed p.a. (previously 6%) Equity ratio above 35% over the cycle (unchanged) * Like-for-like
- 12. 20.8.2015 12 Looking Ahead 2015 growth guidance: On June 12, 2015, the company updated its 2015 growth forecast, calling for net sales to grow 4-6% and EBITDA to grow 5-7%. We’re sticking with this guidance for now.
- 14. 20.8.2015 14 Finland Q2/2015 2014 2013 Rentable space, m² 534,200 543,200 555,900 Rent, €/m²/mo. avg. 16.51 16.79 16.21 Financial occupancy rate, % 92.4*) 93.7 92.9 Net rental income, EUR million 57.6 103.3 94.9 Net sales, EUR million 66.4 118.6 109.4 EBITDA, EUR million 38.1 62.6 56,1 Market yield requirement, % 7.9 7.9 7.9 Fair value of investment properties, EUR million 958.3 951.9 981.0 *) *) 10,000 m² under renovation and 8,500 m² of unoccupied but rented space
- 15. 20.8.2015 15 Baltic Rim Q2/2015 2014 2013 Rentable space, m² 139,100 135,800 119,500 Rent, €/m²/mo. avg.*) 14.42 14.00 15.04 Financial occupancy rate, % 99.6 98.4 99.1 Net rental income, EUR million 12.5 23.6 15.3 Net sales, EUR million 13.2 24.9 15.9 EBITDA, EUR million 7.1 13.4 7.6 Market yield requirement, % 8.9 8.7 9.0 Fair value of investment properties, EUR million 245.1 224.7 212.4
- 16. 20.8.2015 16 Scandinavia Q2/2015 2014 2013 *) Rentable space, m² 64,800 63,000 71,400 Rent, €/m²/mo. avg. 22.05 22.03 21.16 Financial occupancy rate, % 97.2 95.6 89.5 Net rental income, EUR million 9.1 18.0 1.0 Net sales, EUR million 9.5 18.2 1.0 EBITDA, EUR million 4.9 12.0 0.6 Market yield requirement, % 6.3 6.4 6.5 Fair value of investment properties, EUR million 207.1 201.8 217.0 *) December 11-31, 2013
- 17. 20.8.2015 17 Leases Lease stock, % of space Maturity in years Q2/2015 2014 2013 <1 21 17 22 1-3 22 23 22 3-5 11 12 13 >5 22 22 26 Open-end leases 24 26 17 Av. Maturities in Mo 38 39 35 Lease stock, EUR million 437.4 455.9 470.5 20 largest customers leased approximately 29.7% of the company’s rented space on June 30, 2015
- 18. 20.8.2015 18 EPRA and Real Estate EPRA-based and Real Estate Indicators 2010 2011 2012 2013 2014 1-6/2015 Direct result, EUR million 20.9 24.6 29.9 40.5 55.9 27.3 Increase, y/y -3.3% 17.6% 17.2% 35.6 38.1 9.2 EPS (from direct result, undiluted) 0.29 0.34 0.38 0.47 0.53 0.26 Net asset value/share, EUR 4.52 5.10 5.12 4.94 4.52 4.59 Financial occupancy rate, % 94.4 95.1 95.3 93.6 94.7 94.1 Net rental yield, % 7.7 7.8 7.8 7.6 7.5 7.7 Rentable area, m² 527,800 576,900 644,300 746,800 742,000 738,100 Increase, y/y 16.4% 9.3% 11.7% 15.9% -0.01% n/a Fair value of competed investment properties, EUR million 727.7 843.8 956.5 1,410.4 1,378.4 1,410.6 Fair value changes, EUR million 2.7 26.3 -5.7 -17.6 -40.5 -9.5
- 19. 20.8.2015 19 IFRS Figures Summary of IncomeStatement, EUR million 2010 2011 2012 2013 2014 1-6/2015 Net sales 81.2 92.8 107.3 126.3 161.7 89.1 Other operating income 1.6 1.2 1.7 2.0 0.5 0.0 EBITDA 41.4 47.5 55.8 64.1 87.2 50.2 Operating profit 43.0 72.0 48.0 43.9 42.9 38.7 Profit before taxes 33.6 60.0 34.5 22.6 0.6 24.6 Net profitfor the year attributable to parent company shareholders 23.3 46.7 25.8 28.8 -11.7 20.1 Summary of BalanceSheet, EUR million 2010 2011 2012 2013 2014 1-6/2015 Total assets 827.6 962.9 1,082.7 1,560.3 1,502.9 1,610.3 Cash and bank 4.5 12.5 15.7 54.1 28.3 98.7 Shareholders’equity 307.6 343.2 389.5 624.3 575.6 606.3 Interest-bearing liabilities 457.9 547.7 608.1 861.9 841.9 917.2 Key Indicators and Financial Ratios 2010 2011 2012 2013 2014 1-6/2015 EBITDA/net sales, % 51.0 51.2 51.9 50.8 53.9 56.4 Dividend/share,EUR 0.15 0.17 0.18 0.10 0.15 n/a Share price, December 31 4.08 3.35 3.57 4.35 3.70 n/a Return on equity (ROE), % 8.2 15.0 7,4 6.2 -0.5 n/a Return on investment (ROI), % 6.2 9.0 5.5 3.6 3.3 n/a Net debt/equity (gearing), % 147.4 156.0 152.1 129.4 141.4 135.0 Employees in Group companies, average 135 158 178 187 214 232
- 20. 20.8.2015 20 EBITDA, Net Sales & Rentable Space m²EUR Million Net Sales & EBITDA 2015 are analysts’ consensus estimates Rentable space from year-end 2014 to 2015 is assumed to be fixed 0 100000 200000 300000 400000 500000 600000 700000 800000 0 20 40 60 80 100 120 140 160 180 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015e Rentable space Net Sales EBITDA
- 21. 20.8.2015 21 EBITDA and EBITDA-% EBITDA-% turned upward in 2014 Market expects trend to continue 63,7% 50,3% 55,9% 0,0% 10,0% 20,0% 30,0% 40,0% 50,0% 60,0% 70,0% 0,00 20,00 40,00 60,00 80,00 100,00 120,00 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015e EBITDA EBITDA-%
- 22. 20.8.2015 22 July 31, 2015 # of shares % of shares Varma Mutual Pension 25,448,192 23.9 Ilmarinen Mutual Pension 11,089,647 10.4 City of Oulu 3,511,211 3.3 OP-Pohjola Group 1,679,372 1.6 Jyrki Hallikainen/KickoffOy 1,233,236 1.2 Laakkonen Mikko 1,226,184 1.2 The Finnish Cultural Foundation 1,188,042 1.1 Odin Finland 1,119,944 1.1 Sijoitusrahasto Evli Suomi Pienyhtiöt 831,994 0.8 Jenny and AnttiWihuri Foundation 738,398 0.7 10 largest shareholders, total 48,066,220 45.1 Foreign shareholders, total 35,912,381 33.7 Others, total 22,533,031 21.2 Total amount of shares 106,511,632 100 Shareholders