Arlandastad Group AB (publ)

Hi, and a warm welcome to Alarna Star Group's presentation of the third quarter of 2025. My name is Mattias Karlsson, and I will be moderating today's broadcast. With me in the studio are VD Dite Sand and CFO Henrik Morén. A warm welcome!

Tack så mycket.

Innan vi kör igång ska jag också säga att ni kan ställa frågor i chatten så tar vi dem tillsammans med mina frågor efter presentationens slut. Med det så lämnar jag över ord och bild till Dieter.

Tackar för det. Jag kan börja med att inleda och säga att kvartal 3 har varit ett oerhört positivt kvartal. Arlanda Stad and Arlanda Stad Group, what do we do? We are a company that works with real estate development. We run two large projects. One project up by Arlanda Stad and one down in Nyköping Skavsta. We have a total of 8 million square meters of land and these projects are very strategically localized. Namely, places where the state invests billions in infrastructure development. Det är en plats där flyg möter motorväg möter tåg och apropå det så kommer Skavsta 2032 att ha en egen tågstation mitt på terminal och det kommer ta 40 minuter att ta sig från Stockholm City till Skavsta. Och de här projekten jobbar vi tillsammans och nära med både stat och kommun. För driver man den här typen av stora infrastrukturprojekt, då är det viktigt att man jobbar tillsammans, privata näringslivet, kommunen och staten. Vi har en affärsmodell som är lite differencierad. Vårt huvudspår har varit och är att utveckla råmark, ta det genom detaljplanens skede, bygga byggnader och förvalta dem. Men sedan ett antal år tillbaka så fokuserar vi även på att bygga tillsammans med andra samarbetspartners genom Jivebolag och avyttrar även mark i byggrätter i det fall att det är lämpligt. And that we are broadening here is a lead in that we are also increasing the pace for our development boards. They are so mature and long-term in development that it is time and it is possible with a pace increase. If we look at the value creation for the company since 2020, we have created a total value increase of 1.3 billion. Om man tittar lite noggrant här så ser vi att det är olika färger på staplarna. Det blåa och det ljusblåa, det är våra byggnader och det gröna, förlåt, det blåa är... Yes, the blue and light blue are our buildings, the green are our building rights, and the beige bar that comes from 2022 onwards is our JV companies. JV companies are not normally visible in our figures, but it is very important to see that we have actually built up a value in our JV companies of 0.5 billion in recent years. and in the past year we have created a wonderful value for rent in these JV companies of over SEK 30 million. We have large areas that we break down into smaller sub-areas, and here I would like to present one such sub-area and one such business that we have done under Q3. It's an area down in Skavsta, called the Västra Terminalområdet. Today, it's raw material. Raw material valued at SEK 8 per square meter in our books. This land is under detailed planning, and under Q3 we have made a deal with a company called BRA Bygg, around an area of about 540,000 square meters. Detaljplanen räknar med att skapa ungefär 250 000-300 000 kvadratmeter byggrätter. Det är alltså ett arbete som först ska genomgå detaljplan. Vår bedömning är att detaljplanen kommer att antas i slutet på nästa år. And here I think is a very good proof of how we create value. We have land value in the books for 8 kronor per square meter. We still have land today. We get paid in the business here about 500 kronor per square meter of land. Or if you want to look at it where our partner goes in and has a building rights value that corresponds to 700 to 800 kronor for the purchase difference. Then, of course, both we and our partner in this JV company think that these building rights will be even more valuable the day the detailed plan is adopted. So from 8 SEK to more than 1,000 sheets per square meter of building rights or land, it is a way to work with value development in this area. And the product that will be in the western terminal area, It is, if you look to the right of the picture here, you can see the landing lanes. It is Skavsta's landing lanes, so that it is airport-close activities. Everything from hangars to logistics hangars and the like that fit to be located near an airport. And at the bottom of the picture, you can see a runway. Right next to that runway, the train station on Ostlänken will come, as I described earlier. High business speed and good progress. Earlier, a few years ago, when we only worked with self-development, we activated about 15,000 square meters of construction per year. Even in September this year, we have activated 90,000 square meters of construction. And this increase in the pace of development is due to the fact that we are also more flexible in our way and invite partners to be part of and develop our areas. We have self-development, working in partnerships, for example JV companies or the sale of land. Both JV cooperation and the sale of land at the same time improves our own liquidity. Under Q3, to highlight some of the deals we've done, I was just talking about our JV company in Skavsta. We have signed a contract on the removal of 15,600 square meters of construction up in Arlanda to a company called JSR. We sell land for 5,000 kronor per square meter of building rights. It is worth noting that the recorded value of these building rights is between 3,100 and 3,200 kronor. If it is the fifth, sixth or seventh time that we sell to more than 50% of the recorded value, I do not know if it is the fifth or seventh time. But we have never sold for less than 4,200 kronor per square meter. Vi har även ett antal arbeten som pågår i Skavstad och vi har fått en ersättning av Trafikverket på 385 miljoner för att göra skadeförebyggande arbeten så att vi inte är i vägen för Ostlänkens framfart eller byggandet av Ostlänken. De här arbetena är inne i slutskedet och vi har till dags dato erhållit 315 miljoner av Trafikverket av de totalt 385 miljoner som ska erhållas. If we look at our operational operations, we see that both Scandinavian XPO, i.e. our meeting and event operations, as well as our education operations in Arlanda are stabilised and receive both increased supply and supply. Tittar vi på några pågående projekt som vi jobbar med idag så är ett projekt uppe i Arlanda stad, en restaurang som ska opereras av Pontus Fritjof, den kände stjärnkrögaren. Varför väljer han att lägga sig på denna plats kan man ju fråga. The simple answer is that the place is located in the middle of Stockholm and Uppsala, at Sweden's largest airport. It is also a place where we will install about 100 charging stations. So a perfect place for a perfect waiter to open a restaurant. Vi håller på med en bilrekordsanläggning åt ett bolag som heter Autohero. De har varit med oss sedan 2017-2018, successivt vuxit. Vi bygger om och till ytor, motsvarande 2300 kvadratmeter för dem, och en stor uppställningsplats för deras bilar som är till salu. För 1200 parkeringsplatser, en yta av cirka 30 000 kvadratmeter. And if we look down in Nyköping Skavsta, then it is so that the municipality of Nyköping has chosen to postpone all practical vocational training outside the Skavsta airport. We have a 15-year agreement with the municipality and we are now building and implementing a high school for vehicles, transport, construction and installation and a flight school. Sen har vi några JV-företag eller JV-samarbeten som jag skulle belysa lite kort. Vi har ett arbete eller ett bolag som heter F60 Företagsmark. Det är ett område på 125 000 kvadratmeter beläget i Arlanda stad. Vi har vår givet samarbetspartner heter Swiss Life och det är världens största fastighetsfond. Tillsammans med dem så utvecklar vi den här platsen om 125 000 kvadratmeter. Under 2023 och 2024 så har vi förberett område med förberedande markarbeten, terrassering, framdragning av infrastruktur och under 2025 så bygger vi nu för våra första hyresgäster som de facto tar de första byggnaderna i anspråk i december månad, det vill säga nästa månad. We also have a joint partnership with Skavstalund, Skavstalund Företagspark, where we also have our first tenants at the entrance. It's an area where we develop 10,000 square meters of buildings, divided into four buildings, together with 50,000 square meters of exhibition areas. And this is fantastically good and well timed, because the construction of Ostlänken, which will take seven, eight, ten years, the main establishment and the main site for the entire building will be in Skavsta. Logistics and craft shops will be needed, connected to the floor plan. I have already described the Västra terminal area earlier. Our joint collaboration with BRA Bygg. I also want to show that by selling land, it is a way to finance us and get liquidity. And if we look at contracts on land sales that are included during the year, we have Evroc, a land sale of 5,296 square meters, purchase share of 27.2 million. We just described ISR properties, 15,600 square meters, 78 million, and our collaboration is in the western terminal area, which has a purchase difference of 200 million. It is worth understanding here that when we sell the land area, the liquidity itself comes in about nine to twelve months later than we sign an agreement. Because when we sign an agreement on the sale of land, it should be cut off before our customers arrive. Then I hand over to my colleague, Henrik.

Thank you very much. What Dieter has talked about is, of course, a lot of projects and things we work with, but we are also currently preparing what we have actually achieved. And I will try to direct the attention to some important points. We are talking about the market value of our property portfolio, which has increased significantly. The reason for that, and it's important to remember, is that we make transactions and statements that lead to higher values. So it's not about getting a completely different view of what the yield is. Yes, what is it called? The interest rate that we are going to discount is without, it is simply new transactions that lead to our values going up. This is reflected in the dark blue box that our NAV per share goes up. We know that there are many who look at our NAV and think that it should be significantly lower. It's just looking at our valuation in the stock exchange. But in our eyes, we see that our work should lead to an increase in the NAV, not a decrease. If we look at revenue and results, we have stable revenues. I would like to add to the light blue picture and point out that a significant value, rent value, is created, as Dieter has been talking about, in our interest companies, our JV companies, and has contributed to a significant increase in rent value and rent revenues over the years. which comes to us partly, which is outside of what we ourselves provide for our revenue in our books. We have not consolidated our JV companies in our results calculation. I would also like to point out what we have said, unrealized value changes, random transactions and measures to increase flexibility and profitability. We have mentioned before that we are actively working with our cost side. In addition to trying to increase revenues, we are actively working with reducing costs. We will be able to calculate the work we have done so far with our cost savings from and with the third quarter of 2025. So what we already can show on cost savings today is just part of what we hope to be able to achieve. in the future. Here we have tried to call in some numbers that we think are important when we look at the results for the group and development over time. I would actually like to point the attention to some additional numbers that were not included. There is a small asterisk there under property costs. It may look like they have gone up, but then you should remember that in that post there is a one-off post of SEK 7 million. If we remove it, we have a significant decline of almost 10% in real estate costs compared to the comparable period last year. When it comes to operational costs, it has also gone down. There is a part of our cost savings. A part is on what I have called in as administration costs, which have also gone down compared to previous years. And then I want to mention again that this is not the whole effect that we hope to achieve based on the cost savings measures that we have already adopted. De är lite eftersläpande vad det gäller löner och semesterskulder och annat. Det är inte kvar när vi rör oss in här nu mot Q4. Financial costs have also dropped. As you know, this is a result of the lower interest rates today. A lot of our loans are priced according to three-month STIBOR, with a margin on that. They have dropped as the interest rates have dropped, but it is also worth remembering that we have seen, and you all know that, a real decline in the STIBOR interest rate in recent years. 15 months approximately. What is here is the fall in January-September and what we see today as perhaps a more stable level than before has not been fully implemented here. So when we look forward, we see that we should be able to provide lower costs per quarter for financial costs. And then I have also called back on this issue of unrealized value changes due to renewals and transactions. I'm going to speed up a bit here. A few key points related to the balance sheet. We have a stable financial situation. We have a very strong solidity and a low rate of reward. And we also have a very clear focus on our liquid funds. We have always shown strong liquid funds, good access to liquid funds. And then I should mention that this is not bank promises, but this is money on the account. that we can pick up in principle when we want. What I will emphasize is what Dieter also brought up, and that is that in these liquid media, the calculations that we do successively in transactions that we have carried out are not visible. We mentioned Ostlänken, the final billing there, we talked about JISR, we talked about Västra Terminalområdet, so it is liquidity that we foresee should come in in the coming quarter. I've had this one before, and I have it again, just to show what we think is important to point out, namely that we are not changing our financial risk. We want to keep a conservative financial structure. We have no obligations, we have a smaller contract, but we have no obligations. We have a very predictable financing structure. The cost for that varies with the interest rate, but we do not have a high financial risk in the company today and we have no ambition to take on that either. With that, I'll leave it back to you. Thank you very much.

Our focus forward. It's quite simple. It's to follow the tracks that we've already followed during this year. It's obvious that interest rates are leading to a more profitable investment climate. And to own strategically important infrastructure in these times, with the world situation we have, it also makes it so obvious that there are many authorities that can think of being interested in our area. If we look at the demand on the land we are sitting on, my assessment is that it has actually never been higher. And if we look under point Arlanda-Skavsta here, earlier we have somewhere in the average developed between 15,000 to 20,000 square meters of land per year. i år till och med 09.30 så har vi så kallat aktiverat, det kan vara om man säljer eller startar upp givet samarbete eller utvecklar själv, cirka 90 000 kvadratmeter byggrätter. Så tempot har väsentligt ökat och den takten avser vi att hålla. Tack.

Stort tack. Then we wait for questions on the chat for a while, but I'll start a little easy here with what you said towards the end. It sounds very positive. You're talking about 90,000 square meters activated per year, according to 15,000 historically. Is it a new structural level we can think of in the future?

Our assessment is that, and that is because we are more willing to do business with collaboration partners, more willing to do land sales and simply widen the scope to increase the pace. Our level of ambition is that, and if we look at the interest in the area right now, my assessment is absolutely that it will not go down.

If you look at our business over time, we have created a lot of value. If you compare how it looked when the company started today, it has been a fantastic value journey in the books. Then we often get the question if there are values in reality that match the values we have in the books. And then I want to underline what Dieter said earlier, that we sell land today to somewhere, or building rights and land, somewhere 40-50% of what we have in the books. And when we notice that we can do that with 90,000 square meters of building rights, then we get an estimate of the value we have created, that there is actually a value to capitalize on. And that is important to remember. We do not need to throw out building rights or sell with a discount, but we do not need that either, because all the transactions we have made have been with a real premium. That's the wave we want to continue to ride on, continue to develop our areas and create more value.

And to prevent the one who says that it is in the best places when you have sold, of course, that's why you get so well paid. No, if we look at the last three years, we have sold 150,000 square meters of buildings. These are different places, and these have been the levels of 40-50% of the total value.

And we can also mention that this transaction with BRA Bygg, is a bit exciting because it is made for, we talked a little about the value here, say a probable building rights value in the future when the building rights are set to 800 SEK per building right. They are in our books for 8 SEK per building right. So it is important to remember that we make these transactions because we see that it creates a good value for our owners.

Spontaneously, you can see that there is a lot of overvalue in your building portfolio. You value them every quarter. It's an external value that does that. Considering that you have sold such a high premium now, shouldn't you be able to value up all this?

Of course, we always have a dialogue with our evaluators. The evaluation methodology is that you take different time points for when buildings can be realized. And if we were to go out and sell all our buildings today, then it is not certain that we get 5,000 kronor per square meter. We get that from the transactions we make. But the interesting thing is that if we made 15,000 before, even if we make 90,000 today, then that has not changed the price picture of what price we get for our building rights. For the value? For the value. No, for the value, but also not for what we can motivate for the value. If you were to move forward the entire assumption of time when building rights are reimbursed, then the value would also rise in the books. But the valuers are careful, because there are so many building rights we are talking about.

I understand. You also talk about the first three quarters when you had the unreleased value changes of 153 million kronor. Where exactly do they come from?

It is, among other things, due to new contracts. We have, for example, made a contract in Skavsta, together with Nyköping municipality, where they put all their vocational high school education out on Skavsta. It is a fairly substantial contract and contributes to a value increase in our access down there, based on that contract. It is perhaps the contract that has contributed the most to the value increase during this period.

But we have a dozen different contracts up in the rest of the city that have also been made during this period.

So it's real business behind it. Absolutely. It's important to point out. And then the agreement, the agreement with Brabyk in this western terminal. Why is it coming just now? I mean, timing-wise. It's quite a long time before the Ostlänken are in place, for example.

Ja, men det är också ganska lång tid att processa från råmark till detaljplan till färdig byggnad på plats. Samtidigt jobbar ju vi med att få igång flygtrafiken nere i Skavstaområdet. Och ska man få igång flygtrafik eller flygfrakt eller liknande, då är det bra hus att ställa planen i eller någonstans att lägga frakten i. It's timed very well with our development plan down in Skavsta. Then it can be a few years premature in relation to the fact that we have a train station on Skavsta. But we have to think wholeheartedly. So a very good timing, I would say.

Okay, good. But then we came in on Skavsta and how it goes there with the operational business. From what I understand, it's still a bit of a cash flow. But how is the development going to attract more aircraft operators to Skavsta?

The development is going well, but a little slower than we hoped, of course. We have full focus and we have dialogue with a number of different aircraft companies. about getting more passengers there. But as we often underline here, it's not just about getting passengers there. Sure, passengers create revenue hikes, passengers create potential for companies to move there, but Skavsta is also Sweden's largest preparatory airport. So we have a lot of state flights connected to this place, and that increases in scope with regard to the world situation above all.

You mentioned your CEO, Företagspark 60, and that was a long time ago. That's a very large investment, 125,000 square meters, an investment value of 1.8 billion total. What happened there, and how can you see the project accelerating?

That's a good question, and the reason I mention it right now is that this business with Swiss Life was established at the end of 2022. Between 2023 and 2024, we have invested almost 100 million to do ground-based work and develop infrastructure. So now the area is actually prepared to attract tenants. Vi bygger för vår första hyresgäst som heter Gasum, som är finska staten som har vätgasstationer för lastbilar. Vi bygger våra första byggnader på platsen och de inflyttningsklara som nästa månad. Där kommer våra första hyresgäster att flytta in. Vi har en hel del intressenter som vi hoppas komma i mål med att landa innan this year, for future construction. So this is rolling out like a roller coaster, I would say. And it's good demand, good pressure. And if you have done the basic work, that is, made sure that the availability of the area is good, made the land work good, and all the conditions are good, then these products are built in between 9 and 15 months. Then it is very, very attractive. if you compare it with other areas that will first start to be land-based and then build, because then you may have a building time of 18 months and upwards, so that we are very well prepared and are much more attractive than other areas because we have such a short building time.

There I want to make a little point as well. We talked earlier about our financial risk, that we are trying to keep it conservative. Take F60 for example, where we have invested a lot of money in infrastructure and preparation, as Dite was talking about, in preparation of land and other things. We have done that with our own funds. The company that is so close to building credit for this new property is unpaid. So now we have the opportunity to roll out these projects that will come after. Besides, it is so, and everyone who has developed the area knows that when you have received an establishment or two, then new ones start to come in and wonder what they see, why they are there, and then there will be a little ring on the water, hopefully. Lower snowballs.

Maybe we'll soon see a snowball here in Stockholm. The reward rate is 24%. That sounds very conservative. When you talk about acceleration and increased activity, can you go up in the reward level and accelerate the operational activities to get more speed on the wheel with more reward?

Yes, of course we can do that, but we have chosen not to do that because we are a development company. A development company has a bit of a high income if you want to make money on property development. We are not many property management companies that have a stream of liquidity that comes. And that's why we want to be low so that we don't take too much financial risk. Now I'm also going to mention, and you all know that for a while now, that 24% is our collected assets. If you looked at Dieter's picture earlier, you can see that there is a significant amount of building rights. They are counted in there. If we take them away, we have a reward rate of about 50. I don't have the exact figure in my head, but roughly there. It is also quite conservative, but not as conservative. But as a long answer to your question, no, we have no ambition to take an elephant's climb when it comes to financial risk. Men vi försöker anpassa vår finansiella flexibilitet så att det passar det vi försöker utveckla.

Ni pratade också om att det är väldigt hög aktivitet eller beläggningsgrad inom Scanev Expo. I september var det en väldigt stark månad.

September var belagt alla dagar utan en månad.

Is that something that is coincidental, or do you see a change in the situation?

Yes, of course it affects a lot of how the company is doing, and how the lower interest rates affect it, and so on. Then I think that the longer we work with Scandinavian Expo, the more actors get the view that there actually is an institution Very, very good conditions in the Netherlands, because many of our larger events are actually connected to the Nordic basis or the European basis. Again, we have had a NATO meeting on site without anyone knowing about it at all. Completely uncommunicated. So the state loves it.

We know that the Älvsjö fair is closing down in 2029. It's a gigantic fair area. I understand that you would like the fair to be held in Arlanda instead?

Now it will not be put down in 2029, they have communicated a different date. And that is communicated from the point of view that we did not find anyone who wanted to buy the facility again. And it may not be so difficult mathematics either, because you can not buy a facility that backs if you only have access to it for three years, if you do not have a new place to have it on. So the answer to your question is yes. We would love to see that the meeting place and event arena land in Arlanda. And we have all the conditions for it, and we have it in our plans. We have both the location and the detailed plans in place.

I have a question. You have a negative operating cash flow. Now it was 13 million in Q3. And on a whole year basis, it was 111 million. And in the last nine months, it was 68. Does that mean that you are starting to get order on the cash flow?

We have talked about this before. We talked about revenue and costs earlier. We do what we can to increase revenue, but also to reduce costs. And I think we have proven that we do. Then it's like that with our cash flow. It's in our business model. The operational goes back and then the investment business goes, hopefully, plus. And then you have the financing business that balances this out. Det är lite för lätt att se på vårt samlade kassaflöde bara utifrån hur det går i de operationella verksamheterna. Men som svar på din fråga, ja, vi jobbar jättehårt med det här och hela tiden egentligen ser över kostnader och intäkter. Vad kan vi göra för att förbättra det negativa kassaflödet som finns i de operativa verksamheterna?

I want to underline that you understand that if we take Scandinavian Expo as an example again, because during the September month, one of the weeks, we had 3,000 people in place in a company that was there for a whole week. These people live somewhere, they eat somewhere, they live somewhere. That is revenue that is visible on the property side, so you must not forget that these businesses are connected. You can't see an operational business as a solitary unit and say, oh, how bad it is.

You can do exactly the same thing at Skavsta. Skavsta has a very good progress right now in how we are going to develop the area. And that is based on the fact that there is an airport there and that the airport generates an interest for the area. So if the operational business at Skavsta goes down, it is only half the truth. We are looking at the whole as a combined business. Just that, I had something else to say, but I forgot.

Okay, but in conclusion, have you been looking at 12... Yes, now I know what I'm going to say.

When we look at our cash flow, we have once had the question, why do we finance our negative cash flow in an operational business with a bank loan? It's wrong, we don't do that. If we look at how we work, we work with transactions, we work with different types of proceeds, etc. If we take Skavsta for example, if we look at how that activity has developed during the time we have owned it, then it is actually roughly plus minus zero cash flow wise.

As a conclusion, if we look out 12 months ahead, how do you see these situations and the situation in Arlanda?

Vi gör ju aldrig framåtriktade prognoser, men som jag sa till dig förut, att det är ett otroligt stort intresse. Tempot har ökat, och vi ser inte nu att det kommer att vara någon minskning i tempot.

Det låter som en bra avslutning. Stort tack, Peter, Henrik. Tack till alla ni som har lyssnat. Ha en fortsatt fin dag.