Vasakronan’s Interim Report January – September 20232023-10-27
Strong income from property management in uncertain times
- Rental revenue increased 13% (9) to a total of SEK 6,826 million (6,024). The increase was primarily due to indexing. In comparable property holdings, the increase in rental revenue was 11% (6).
- New lettings were contracted corresponding to 85,000 square metres (124,000) and an annual rent of SEK 437 million (741). Net lettings amounted to a negative SEK 79 million (positive: 278) for the period and a negative SEK 85 million (positive: 341) for the rolling 12-month period.
- Renegotiations were completed in the period corresponding to an annual rent of SEK 1,046 million (802), with an average price change of 2% above index (6).
- The occupancy rate was 91.1% at the end of the period and was 91.2% at the end of 2022.
- Operating surplus increased 16% (7) to a total of SEK 5,110 million (4,411). For comparable property holdings, the increase was 11% (3).
- Net financial items deteriorated to an expense of SEK 1,294 million (expense: 827), due to higher interest rates during the period.
- The LTM interest coverage ratio decreased to a multiple of 3.8 (5.3) due to the deterioration in net financial items.
- Income from property management amounted to SEK 3,608 million (3,379), up 7% (7).
- The change in the property value amounted to a decrease of SEK 9,160 million (increase: 11,028) for the period, corresponding to a decline in value of 4.8% (increase: 6.1). The change in value was primarily due to higher assessed yield requirements. The property portfolio value at the end of the period amounted to SEK 181 billion.
- The value change in financial instruments amounted to a decrease of SEK 855 million (increase: 1,715).
- Profit after tax amounted to a loss of SEK 5,209 million (profit: 12,786).
“Despite a turbulent market, we continue to increase our cash flow and posted a positive performance in income from property management,” says Johanna Skogestig, CEO of Vasakronan. “This was due to increased rental revenue in combination with relatively stable net interest. Moreover, we have a correctly positioned property portfolio. There is considerable demand for environmentally certified properties with top-notch premises located close to public transport links and demand is highest in our city centre locations.”
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