SBB, Interim Report January – September 2021: Profit after tax SEK 8.56 per class A and B ordinary share

SAMHÄLLSBYGGNADSBOLAGET I NORDEN AB (PUBL): INTERIM REPORT JANUARY – SEPTEMBER 2021 IN BRIEF

• Rental income increased to SEK 4,235m (3,868).
• The operating surplus increased to SEK 2,965m (2,669).
• Cashflow from operating activities before changes in working capital was SEK 1,721m (1,590).
• Profit before tax increased to SEK 15,746m (6,142), of which:
  • Profit from property management is included in the amount of SEK 2,437m (1,601). The profit from property management includes costs for early repayment of loans and other non-recurring costs of SEK -324m (-309).
  • Changes in value of properties are included in the amount of SEK 11,982m (5,248).
  • Changes in the value of derivatives are included in the amount of SEK 1,336m (-268). 
• Profit before tax increased to SEK 15,746m (6,142), of which: Net income after tax for the period was SEK 13,296m (5 734), after the deduction of deferred tax of SEK -2,290m (-316) and current tax of SEK -160m (-92), corresponding to earnings per series A and B ordinary share of SEK 8.56 (4.07) before dilution.
• The value of the property portfolio amounted to SEK 125bn (90.2).
• Long-term net asset value (EPRA NRV) calculated in accordance with EPRA’s new guidelines for net asset value calculations was SEK 49,296m (37,505), corresponding to SEK 34.55 (28.21) per share.
• Rental income increased like for like by 1.7 per cent compared to the corresponding period last year. Net operating income increased like for like by 3.0 per cent.
• SBB’s average interest rate has decreased from 1.41 percent at the end of Q3 2020 to 1.11 percent, resulting in a decrease in total financial net and contributing to an increased interest coverage ratio to 5.7 times (3.7).

THE THIRD QUARTER IN BRIEF

• Rental income increased to SEK 1,459m (1,204).
• Net operating income increased to SEK 1,089m (852).
• Operating profit increased to SEK 995m (677).
• Cash flow from operations before changes in working capital amounted to SEK 589m (411).
• Net income after tax for the period amounted to SEK 4,003m (3,139), corresponding to earnings per share of SEK 2.63 (2.22) before dilution.

FORECAST FOR 2021

• For the full year 2021, earnings per ordinary share A and B are estimated to amount to SEK 9.80 which is an increase from the forecast of SEK 7.80 that was provided in the second quarter.

”SBB is now a well-oiled machine where all segments of the property management business and our three value-add strategies contribute every quarter to deliver and exceed the plan. Profit after tax was SEK 13.3bn, an increase of 132 percent compared with the first nine months of last year. Our return on equity over the past 12 months is 33 percent.

At the same time, growth in profit from property management per ordinary series A and B share over the past 12 months exceeded 60 percent. SBB’s rental income is linked to the CPI and is therefore hedged for inflation. For the first nine months of the year, the like for like increase in rental income compared with the corresponding period last year was 1.7 percent, which was 140 basis points above last October’s CPI, which is the principal base for the rent increase in the current year’s rental income.

Our value-add strategies continue to deliver quarter after quarter. Only the profit from our two value-adding strategies Development of building rights & new production, and Investments in existing portfolio ended up at SEK 3.0bn for the first nine months of 2021, corresponding to earnings per series A and B ordinary share of SEK 2.23 for the nine-month period. SBB’s 12-month rolling earnings capacity from property management and our value-add strategies rose by 63 percent per series A and B share over the past year and was SEK 4.67 (2.86) at the end of the third quarter.

We continue to raise our interest coverage ratio, which was 5.7 times at the end of the period. We have SEK 130bn in unencumbered assets and long average debt maturity and long fixed interest rate maturities. Our ratio of unencumbered assets is among the highest in Europe and we show that we have the conditions for a BBB+ rating. SBB had an average interest rate of 1.11 percent at the end of the third quarter.

The quality of our assets, both in terms of the security of the rental flows and of their liquidity in the transaction market, has proven to be among Europe’s most secure in challenging times. This commits us to continue building Europe’s largest property company focused on secure assets. We continue to deliver results and shareholder value.”

Ilija Batljan
CEO and Founder

Attachment: Interim Report January – September 2021

For further information, please contact:

Ilija Batljan, CEO and Founder of Samhällsbyggnadsbolaget i Norden AB, ilija@sbbnorden.se

This information is information that Samhällsbyggnadsbolaget i Norden AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out above on 4 November 2021, at 08:00 CET.

Samhällsbyggnadsbolaget i Norden AB (publ) (SBB) is the Nordic region’s leading property company in social infrastructure. The Company’s strategy is to long term own and manage social infrastructure properties in the Nordics and rent regulated residential properties in Sweden, and to actively work with property development. Through SBB’s commitment and engagement in community participation and social responsibility, municipalities and other stakeholders find the Company an attractive long-term partner. The Company’s series B shares (ticker SBB B) and D shares (ticker SBB D) are listed on Nasdaq Stockholm, Large Cap. Further information about SBB is available at www.sbbnorden.se.