D. Carnegie & Co AB (publ) reports for the third quarter of 2018 an increased profit after tax amounting to SEK 881 million compared to SEK 525 million for the third quarter of the previous year. For the first nine months of the year, profit after tax amounted to SEK 2,709 million compared with SEK 1,229 million corresponding period previous year.
Earnings per share after tax were SEK 30.97 (15.86). The adjusted equity (EPRA NAV) increased 30 percent compared to the third quarter 2017 and amounted to SEK 158.13 per share (122.04) as of 30 September 2018.
January – September 2018
• Rental income increased to SEK 1,316 million (1,085)
• Net operating income increased to SEK 699 million (583)
• Income from property management amounted to SEK 217 million (295)
• Unrealized changes in the value of investment properties of SEK 3,085 million (1,209)
• Changes in the value of financial instruments of SEK -37 million (-6)
• Profit before tax increased to SEK 3,244 million (1,565)
• Profit after tax increased to SEK 2,709 million (1,229)
• Earnings per share amounted to SEK 30.97 (15.86) before dilution and amounted to 30.91 (15.79) after dilution
July – September 2018
• Rental income increased to SEK 464 million (383)
• Net operating income increased to SEK 268 million (231)
• Income from property management decreased to SEK 97 million (135)
• Unrealized changes in the value of investment properties of SEK 1,024 million (514)
• Changes in the value of financial instruments of SEK 7 million (2)
• Profit before tax increased to SEK 1,127 million (652)
• Profit after tax increased to SEK 881 million (525)
• Earnings per share amounted to SEK 9.58 (6.76) before dilution and amounted to 9.55 (6.73) after dilution
Significant events during the third quarter
• On 7 September 2018 D. Carnegie & Co entered into an agreement to acquire two residential properties comprising 52 residential apartments located in Södertälje for SEK 70 million.
• The number of B shares and votes in D. Carnegie & Co has changed as a result of the exercise of 97,000 warrants (2015 incentive program).
Significant events after the third quarter
• D. Carnegie & Co AB has on 1 October 2018 completed the earlier announced acquisition of two properties from Fastighets AB L E Lundberg for SEK 70 million. The transaction was structured as a share deal.
• On 16 October 2018 in an extraordinary general meeting D. Carnegie & Co decided to change name to Hembla AB.
As previously announced the company is planning to change its name to Hembla AB (publ). Through the new name the company wants to emphasize the core of its business model, the home of our tenants. The name is intended to clarify the company’s orientation and Hembla associates to something that is central in most people’s lives. Work on the planned name change, including a new website and graphic profile continues during the fall of 2018. The company intends to, separately later announce, the exact date when the new name change enters into force.
Statement from the CEO
The third quarter has been eventful in many respects. In the first half of September, we took the next step in our tenants-first-approach by announcing that we are changing our name to Hembla. The word “hem” means “home” in Swedish and the new name will help us to communicate our main objective, which is to put our tenants and their homes at the center of everything we do. We believe that the most important part of our business is to provide opportunities for our tenants to create great homes and life stories. The new name will play an important role in clarifying this orientation to all stakeholders going forward. Tenants first also mean that we are just as much a customer service company as a residential real-estate company. Therefore, we have been strengthening our central organization with key competences to ensure that we continue to deliver high-quality service to all our tenants. During the third quarter, we also announced the acquisition of 52 apartments with strong development potential in Södertälje, further expanding our presence in the fast-growing Stockholm region.
Investing to generate value for multiple stakeholders
During the third quarter we completed 355 apartment renovations, bringing the number of renovated apartments to 1,169 for the first nine months of the year. We also continue to invest in our properties’ exterior and common areas to improve entire neighbourhoods and create modern, attractive living environments for our tenants. Our comprehensive investment program will improve the standard of our properties and communities. In addition to creating better living environments for our tenants, our extensive investment program also generates significant value for our shareholders. Change in our asset value amounted to SEK 1,024 million in the third quarter and EPRA NAV amounted to SEK 158.13 per share, up 30% compared to the same period last year.
Continued social involvement
During the summer we have employed a number of youths in our areas to carry out important tasks on our properties including painting, repairs, maintenance and cleaning of outdoor and indoor areas. The program has been a major success with a number of positive effects including providing a first employment experience. We have also continued our other social engagements, among others the football school we arrange together with AIK. In October, when AIK played one of their last games of the season against Örebro IK, 25 children from our football schools accompanied the players when they entered the football field. Their parents, our tenants, were invited to watch the game and share this moment with their families.
The road ahead
I look forward to continue leading the company and execute our proven strategy together with all employees during the rest of 2018 and beyond. We are convinced that the Swedish rental housing market will be an attractive segment for years to come and that we will be able to continue to grow and deliver superior value to all our stakeholders
Stockholm 26 October 2018
Svein Erik Lilleland
CEO, D. Carnegie & Co
This information is information that D. Carnegie & Co AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation and the Swedish Securities Market Act. The information was submitted for publication, through the agency of the contact person set out above, at 7.00 a.m. CEST on 26 October, 2018.
About D. Carnegie & Co
D. Carnegie & Co is a property company focusing on residential properties in the Greater Stockholm region and other growth areas. The company’s business concept is to own property portfolios slated for a gradual renovation of apartments in conjunction with the natural turnover of tenants. This can take place quickly and cost-efficiently thanks to extensive experience from the company's renovation method which, among other things, means that no evacuation needs to take place. In addition to this, the company creates value through the development of building rights in existing portfolios. The market value of the company’s properties amounted to SEK 30,139 million on 30 September 2018. The total rental value amounted to SEK 1,893 million annually on 30 September 2018. The economic occupancy rate is high – vacancies are virtually non-existent. D. Carnegie & Co is listed on Nasdaq Stockholm.