ALM Equity AB (publ)

Hello and a warm welcome to ALM Equity's presentation of the first quarter of 2026. My name is Mattias Karlsson and I will be moderating today's broadcast. With me here in the studio I have CEO Thomas Karlsson and CFO John Sjölund. Welcome. Thank you, Mattias. Before we start, I would like to remind you that you can ask questions in the chat. We will take them in the common question time after the presentation. With that, I leave the floor to you, Thomas. Thank you so much, Mattias.

We will present the quarterly report for Q1 for ALM Equity. The agenda is that I will start by telling you about ALM in short and some key words. Then I will leave the word to John who will tell you about the results for the quarter and the market situation. And then we will finally tell you a little about our project Archimedes in Bromma where we We have started building and then we will talk about the way forward and our focus areas. Finally, we hope for some questions from Mattias. Yes, and Alm Equity is a property developer that has three business branches. Development, entrepreneurship and administration. We have a flexible business model where we develop housing both for rent and housing rights. And we have a focus on communication-near apartments, effective apartments. We have a model where we like to include capital partners in JV-cooperation. And beyond our own core business, we have two assets in the form of Klövern and Beskab. If you take a look at the key figures per business area, we currently have about 3,300 units in our development portfolio. Of these, 78% are finished building rights and the remaining 22% are under planning. In our entrepreneurship business, we have 1,344 homes under ongoing entrepreneurship, where all of them are for the time being for external customers. And we have an order stock of 1.9 billion. In administration, we have together in our JV cooperation in urban neighborhoods, 2,710 units in administration. In the beginning of the quarter, we had an rental rate of 95%. Essential events during the quarter. We completed the acquisition of the Stockholm housing in January and filled in our building rights portfolio. We have completed the certification of all our administrative assets, so that all of them are now certified according to BREEAM in Use. After the quarter, we have started building the first three part projects in our project in Bromma, which we call Archimedes. And we have also communicated and assigned an extended management of the company, where we have assigned our business management and our business and transaction manager.

Yes, if we look at the results of the quarter, we can note that we have an entrepreneurial business that has been stable for a long time, which has grown with a fairly even turnover and a good margin. And then we come from a period where we haven't had anything in production, in the development business itself. Now we have come up with the news that we are starting a project here after the end of the quarter, but in Q1 we have no support for the entrepreneurial business. carry everything and for us to get a positive movement result, we need a little help from that part. Then we can also note that there has been a bit of chaos in the environment that has affected the capital market and there we have negative value changes in our content during the quarter. Although we think that both Klöver and Beskav do a lot of good things, they are punished by what happens in the environment. In the long run, we see that they will create contributions, but we feel that we should not be dependent on that, but it is development and entrepreneurial activities and the administration that exists that should carry us. If we look at the balance sheet, we see that we still have a very good liquidity position. And then we are sitting with our assets, which will be a very good balance against the debt side. So we are in a good position to have the opportunity to start production projects, we have the opportunity to invest in more. more building rights as the situation is now. So the focus forward is to get more building rights into production. Looking at the market, we feel that the environmental factors for our business have slowly and surely improved over the past two years. There has been a lot of stabilization. The private market has strengthened slowly but surely until it started to collapse in Iran. Then there will be a little more insecurity among consumers who are going to buy housing for a longer period of time. And a little insecurity on that side. We hope that everything will calm down in the future, even if there is nothing we can advise on. We see that we are in a much better position than we were a year ago. Sweden has a strong economy and it is a strong general market for the rental rights we produce. It is a big demand among investors to buy newly produced rental properties in Stockholm, which is something we see as very positive for our side and that will facilitate the business forward.

Precisely, and we were going to zoom in a bit on our project in Bromma, Archimedes, where we have now communicated our first construction start of the three first part stages in the area. It is an area that will have a mix of Small, surface-efficient apartments against the administrative market. Combined with a couple of stages that will be housing rights with varying sizes. Everything from one to four rooms and kitchens. We have both new production and a lot of conversion. of an old office building above all. We will create just over 500 new apartments. And now that we are starting these first three stages, we are planning for a first sales start after the summer in one of the intended BRF parts. We will develop the area in seven stages and by the time we are finished, we will have supplied the area with about 950 apartments. If we briefly zoom in on what we are starting to build now, which is highlighted here in the upper image, it is our three-part project Volta, Vector and Axis, as we call them. In previous communications, we have mentioned Archimedes A, B and C. There are a total of 357 apartments in the three floors and all of them are designed for the administration market. We have a high sustainability ambition in the project and will certify according to BREEAM Excellent. Together with this start-up, we will also build the garage that will supply the entire area. The total construction time for this project is just under two years and it will be our own entrepreneurial business that will be a total entrepreneur. If we take a look at some of the priorities for 2026, as we have been clear about, it is construction starts that are the focus for us. We are very happy that we have now started the first part in Archimedes. We have also sent in construction permit applications for the next two stages, a total of 549 homes. where the plan is to keep the construction laws and be able to start them in the second half of 2026. We have two sales starts in the pipeline. We have our own project Elverket in Sundbyberg, where we build premium apartments. We will have a sales start at the end of May. And as I mentioned, we will also start a first stage in the Bromma Archimedes area in the aftersummer.

The power plant we see in the background is a very nice project.

A very special project with a conversion of an old industrial building. It will be super nice apartments. Let's move on to the Storstadenprojekt. As we have now got into our business, there is a full focus on optimizing the product and highlighting what we can find for and get those processes moving forward to get to the next step in different stages. It's a large portfolio that stretches over time, so we have both detailed planning processes and construction law processes, so it's a full focus to go through the entire portfolio. Our entrepreneurial activity is moving at a good pace and we assess that we will continue to fill it during the year with both internal projects The one we started now, 357, plus the ones I just mentioned that I sent to Bygglo before, so it will be about 870 units that can potentially start there. And then we have a number of positive dialogues with external customers, so we estimate that we will be able to start about 200 to 300 homes externally as well, during 2026. That was it.

Thank you very much, Thomas and John. Let's continue with our Q&A session. We have a question from Bertil Nilsson from Karl Square. Have you noticed if investors who buy ready-to-buy rental flats for the administration have changed their dismissal requirements due to the latest geopolitical concerns and the risk of increased inflation?

Jag har inte sett någon egentligen förändring utan jag har upplevt att marknaden har varit relativt oförändrad under den här perioden. Det är alltid svårt när man sitter inte i jättemånga processer parallellt. Det är folk som man sitter och förhandlar med löpande. Men min bild är att det fortfarande finns ett stort intresse att köpa nyproducerade hyresbostäder. Sen kan man säga att det har varit en ännu hetare marknad om inte den oron funnits. Så det kanske gjort att vi snarare har behållit samma status som vi hade i början av året istället för att fått en ännu större boost i den marknaden.

Thank you. If we look at the result, you had a movement before the change in value at negative 11 million. It's an improvement from the previous year when you had 36 million negative. But the result is still negative. First of all, what does it take to get a positive movement result?

The given analysis is that we have our entrepreneurial activity today, which is what generates turnover and results. So the focus is, as I said, to get the development business going. That's what will make the big difference for us. Then we see that we have We have a better result now, which is due to the fact that we have reduced the central costs. We are in a joint office now, for example.

You can imagine that the results will continue to be negative over the next one to two years.

When we get good speed on our development business, especially when we produce rents in cities, then you do a running value calculation on that business. Then you can say that in the project development business, you do a lot of work and value-making things that come before you start producing. You can work several years with a detailed plan, you can work several quarters with a building permit and trade entrepreneurs and plan the project so that you get a good value in the end. When it comes to housing rights, the profit from the calculation comes at the end of the project. If we look at IFRS in the segment, we help the reader to see how the value creation comes during the production period. But actually, in reality, a value creation already before and it's not shown in the results. So we have done value-creating things but not shown it in the results.

And then we come to your liquidity. The liquidity decreased with 140 million in Q1 to 680 million. What kind of liquidity do you need? when you start a project and then how much capital can be allocated without increasing the risk of balance sheeting?

We can use a whole lot of the liquidity that is in the cash register without creating any problems in other parts. Then we measure it all the time, what is the incoming inflow and what is the incoming outflow and is it something we should Should we go on the acquisition side and buy something or is there any access that we sell off? So we weigh these against each other. We have believed that it has been good to have a strong cash position, which has made it possible to be quite fast when opportunities appear on the market. For example, it was not in Storstad that there was a huge liquidity impact to implement the acquisition. If we had gone a little too heavy on the liquidity side, then we would not have been able to implement it. The way we managed to do that was what made it possible for us to quickly move forward and find a business that we could reach.

You have also worked with your financial costs. They fell by 10 million compared to the previous year, which is now at 21 million net. And then you have the obligation debt that falls between 2028 and 2029. How do you see the possibility of lowering the financing costs further and also the debt situation?

We are in a pretty good liquidity position. We are always considering the financial assets we have versus investments in other businesses and amortization of debt. Then you meet... The obligation side is very pleased with the journey they have had in AlmEquity and that they have had investments with us. It has been a messy environment, but we have managed to reduce the obligation debt from 2.2 billion to 1 billion. So that is something that they will have in mind next time we do something on the population market. So we have the hope that we will come out with more profitable financing next time we do something.

And now on my mind, what is your average interest rate?

It is probably Stibor plus 675, if you look at both.

Okay, if we leave the finances behind us and move on to the business, you have started 357 rental properties in Archimedes after the end of the quarter. What other resources are needed to start the remaining stages during the second half of the year?

The next stage we are focusing on is stage F, which is the large conversion project. There are 500 plus apartments in that project, also for administration. We have allocated capital for the project. The construction law application is submitted. When the construction law comes in, Then we see that we should be able to drive it towards a construction start plan. We have a deal with our two entrepreneurs who will carry out the project. It is the next step and the stage in Archimedes where we think that we will start sales. We have also sent in construction permits. So there we have a construction permit process and a sales process to come up with a sales degree to be able to start it.

In general, we have a fairly large volume of building rights with a complete detailed plan. We have quite a lot of capital allocated to the building rights. We have our own entrepreneurial capacity that is good. If we hit the roof and two years pass, there is plenty of entrepreneurial capacity out in the city that we want to help build. And there is plenty of debt financing. So we are still in a good position to be able to increase the pace.

Okay, that sounds good. Your goal is to start building an average of 1,000 flats per year. That's the last answer. What are the biggest limitations for achieving that? Is it capital or demand that is the most important?

It's a combination of several parts, but the demand we see, where we have a lot of focus on administration, with the possibility to switch to BRF and with our surface-efficient apartments that we develop, we see that there are good opportunities there. So it is the process with the development and the construction law that is the focus right now to get started.

If we look at the rental market, how do you perceive the market in terms of newly produced, surface-efficient housing in Stockholm? And do you see any vacancy risk in your own stock or future projects?

We feel that we have a very good product and in a good position. If we combine this product that makes the threshold not very high for those who are moving home or those who want to move into a newly produced home, we have very good products so we keep a good balance. In the quarter, we cut down a couple of percentages, but that was because we got back an old block yield result that was found from the Swedish new and renovated period, which created an effect just before the quarter change. But we feel very confident with the stock we have. That sounds good.

You also ended the Storstaden affair. When do you think the first projects in the Storstads portfolio will start and which steps are most important before then?

We have a number of projects that have law-abiding detailed plans where we are working with the construction law. Our assessment now is that we will send in two to three construction law applications this year and we will probably start them in the first half of 2027. You never know with such processes. It could be that we manage to start someone in Q4-26 or that it goes into Q7-27. But we believe that we are on the right track with a couple of the projects in the large-scale portfolio.

On the entrepreneurial side, you have an order volume of 1.9 billion now, but you had no order entry in Q1. Is it just timing or do you see increased caution from external customers?

I would say that it is just a coincidence that nothing came in Q1. We see a It's getting better and better. There is an increased interest. We have a number of ongoing dialogues about new projects with both completely new customers and returning customers externally. So we are looking at the situation that the entrepreneurial business is in. We expect that it will be fulfilled.

Okay. You also see that the transactional activity for rental properties seems to increase. Are you being watched over rental properties or future rental property projects? And can sales become current?

No, but it is quite high activity among both those who want to buy and those who want to trade these types of objects. So it's a bit of a hard currency right now when you're sitting on newly produced rental properties. I don't at all understand that the activity is as high in the older stock. So they've been sitting with an old stock with... with poorer products, poorer housing, a different management economy, higher operating costs and debt, then the interest is not as big. Then we see a possibility to switch out some of the rental housing that has been in stock for three, four, five years. and produce new rental properties from Byggrättsbanken. If the right opportunity arises, we will catch it. If the opportunity does not arise right now, we will wait until it really becomes the right one so we can maximize the value.

Cool. Then you have also developed the concern management with a business area manager and then also transaction and business development competence. What is the reason for this?

It goes in line with what we said that now it is back to basics and focus on our own development and entrepreneurial business where it becomes very natural to bring in those responsible for respective business legs. plus our transaction and business manager who focuses forward to increase the understanding of each other's business, to be able to help each other to get everything forward. We see that this will increase the pace of the process and we will minimize risks. There are many advantages to doing it that way.

To conclude, if we are here in a year and sum up 2026, what will happen in Alameda Equity for you to be satisfied with the year?

If I take it to what we have said, our focus areas with start-ups and production, it is that we should be somewhere around these 1,000 units that we have talked about. Then if it becomes 900 or 1,100, that is not the important thing. But we should be there somewhere and we should see that we have positive dialogues in the future, even for the upcoming project.

Okay, good. Thomas, Björn, thank you very much for this presentation and discussion.

Thank you.

And thank you to everyone who has listened. Have a nice day. Bye.