Fastighetsbolaget Emilshus AB (publ)

Hello and welcome to today's webcast with Emenshus. The CEO Jakob Fyberg and CEO Emil Jansson will present the report for the first quarter of 2025. After the presentation, there will be a Q&A, so if you call and want to ask a question, press the star 9 to raise your hand and then the star 6 to activate a sound. It is also possible to send questions in the form to the right. If that's the case, I leave the floor to you, Jakob.

Thank you, PD. Emil will present the Q1 2025. We will talk about how we have delivered the result. We will also talk a little about what we have done after the quarter, also after a lot has happened in the company. But we can say that there is high activity in Emelshus. There is high activity on the transaction side, on the management side, on the financial side, but also on the capital market. And for us, it is very important to deliver a good management result. You know that from earlier. For the first quarter, we deliver a result of plus 33%. It is then linked to our stock share, i.e. the management result of the stock share. This is a goal that we should always evaluate, from the point that 15% is the goal and we should always try to deliver over 15%. And we break down a little here in the rest of the numbers. Emil will present even more in detail, but if we look at the management result as a whole, it is up 43%. The cash flow is also up, in reality it is up 55%. Then when it comes to our stock share, as I said earlier, it is up 33%. The roll is 12 months, which is our goal, so it should always be over 15% and now it is 20%. So this delivers well, stable, increased cash flow, which the company likes. We break down a little here in our important parts, so we first come to management. It is a hard work there. We have a positive net expense of 2 million, which is good. We are still at a very high expense, it is 95%. It is always about working close to the guests. All the time, around the clock, we have a new agreement, meet some approvals with new approvals. We have succeeded with that, we put it on the plus side. Also work very closely on the cost side, to keep the numbers in balance. We think we do very well. And if we add our energy projects, which we are constantly working on, which also gives good results. Yes, and then we come to the transaction side. We say that we are a growth company, a company that will expand. We have really done that during this quarter and also after the quarter. We talked recently about the deal with Kalmar Solutions, which was a great unit. We have acquired there in Halmstad, a larger package, and after the quarter we have also made a larger acquisition in Skåne for 1.4 billion. Light industry, the category we want to work within. So yes, high activity, but there is also more to do. And then, here is Emil and his group, we have worked very well on the financing side, it is a negotiated loan. We have also made a preference share of 267 million kronor, which will also be part of the acquisition we did in Skåne. We have also made a new obligation of 400 million, for very good conditions. So even there a very active work. Yes, when it comes to our financial goals, it is very important that we deliver 15% on management results for our stock share. Now the rolling 12 months we are at 20%, which is above our goals, which we think we should always do. Then when it comes to the own capital, it should be 15%. There we are now at the rolling 12 months at 9%, so we can work up something. At the same time, we ourselves who control the management result, and as I said, there we are well. Then we will talk a little about our real estate too. Yes, and now we are at 10 billion. When we noted the company in 2022, we were at about 5 billion. Then we said that we would reach 10 billion in the year 2024-2025. We missed that by a quarter. But we still think that it is in line, that we are working on and is a growth company, which we said at the note. Then we have removed the volume goal. It is, as I said, understated against the management result, but still the company is growing in good pace. Then we look at the capital, it is a small gap from 2023, but 24% growth, but also during 2025 a very large growth. We will see where this year ends, but right now we have very good transaction volume, and we will also get very good business. We will get there in a while, but we see that there are conditions for the company to grow. It has grown now with 34% and the rent value is almost 900 million SEK. The rent is good, it is 95%. It has been here for a while, and we will work with it to keep it at a high level. Our contract time is also over five years, which creates stability for the company. Then we have said earlier that we will rejuvenate places in eastern Götland, we did that during the autumn. We have also said that we will get bigger in Halland, and above all in Halmstad. We also did a contract during the autumn, but now we have also put a bigger contract from Kåren, which means that it has become a really good management unit. We have also been able to establish a management office, which is important to us. We think that is in line with what the company should do. We are up to 183 properties and the value of the property per square meter under SEK 10,000. In line with what the company wants. If we connect this to the business we have done, we have acquired from Kåren a larger district in Halmstad for SEK 520 million. Easy industry with good guest houses, good quality in the house, and very good conditions, so sitting close to the properties just outside of the philosophy we have. Our houses should be in growing areas, but they should also be good in the area, so there is an alternative use case for them too. But here it is mostly exposed to large, strong guests. In the picture you see HMS Networks noted company with its office and production. This property is only 100 meters from the train station in Halmstad. Then we have previously talked about the property in Ljungmj with Kalmar Siloser, we do not need to mention it so much, but it is also a good guest house with a long contract and it is going very well. But it still covers what we have done during the last quarter. Then together with the last acquisition, which is a large acquisition, but also an important acquisition for the company that we enter the Öresund region, here we have bought 35 units, 35 properties for 1.4 billion. And we have done that from the fact that it fits us very well. It is easy industry and layers in large parts in operations that we have identified that are interesting for EMLSUS to be effective on. And from this we have built or will build a platform, I have not added a thousand yet, but we have a very good platform to operate from. And here it should not stop, but we will continue to make acquisitions in the Öresund region and build up a strong unit that completes our stay in Småland together with the trade in Östergötland. Then we will always continue with our Smålandish thinking when it comes to acquisition and management. So it is the Smålandish entrepreneurship that will continue to live in us as a company, even though we expand out in the Öresund region. Here we see a little at which places the properties are located. It is in good, stable places with growth focus for us there. And it is our intention to build on these units and now during the summer establish a management office where we will have technical management in collaboration with commercial management and the management of rents, which makes this a good unit to work from. Of course, we will also make more acquisitions. It will be very exciting to start with this and then build on. When it comes to our hiring guests, we are still at a good hiring level below the 900 kronor per square meter. We are working to extend our hiring numbers. We know from earlier that we are extending our hiring numbers. We do not stretch the levels too much. We think it is so much more important that our hiring guests are left in the house and that we can maintain this good hiring level as well. What is positive here is that our project portfolio has grown. It has grown to over 100 million, with over 70 percent. This is linked to some larger projects. It is very happy that our hiring guests want to make bigger and more affordable. This is also an indication that the company in our portfolio sees that there is a possibility to do something and see the future in light. We do not think that we notice any big changes in our hiring guests. Then it is always important to be observant, of course. But as I said, the project portfolio is growing, which is very fun. If we look specifically at a new construction, it is a property called Jönköping. It is linked to Orkla. It is a candy store that was there earlier. The agreement is now signed with Orkla. It is for a 25-year hiring period. The agreement is signed until 2050. A long agreement. What we are going to do here is to rebuild the property. We will adapt to increase production and increase it vigorously. We are also in the process of acquiring a property that they will establish. This will become an even greater unit to see the demand that the hiring guests have. Which has been huge in recent years. Which is very pleasing for us, in the sense that we can have a longer agreement with the hiring guests. When it comes to our sustainability work, you know earlier that there is a great focus on energy use. And to do savings, measures and investments. We have a group that works very dedicated. House by house we feed on this. It also gives effects on the rolling 12 months. It saves 6%. Which we also see in our numbers in a very good way. We will continue with this. This is the story through the sustainability work of the company. It is very easy to measure. It is very clear to see. It gives effect for us and the hiring guests. Which is very good.

I will comment on the results during the quarter. During the first quarter of 2025, the rents were raised to 202 million. Which can be compared to 158 million for the corresponding period 2024. Which is a growth of 29%. This is mainly driven by the acquisition that was made last year. But there are also indexes contributed. If you look at the property costs, they increased by 22% during the same period. The lower cost increase compared to the growth in revenues is mainly a result of energy efficiency measures. Which Jacob was talking about. And a generally greater efficiency on the cost side. This is also clearly seen in the excess rate. Which increased by a little more than 1% compared to the corresponding quarter previous year. And now per Q1 2025, up to 78%. In summary, this means that the drift network increased by 30% to 159 million SEK. Costs for the central admin and up to 10 million. The higher cost for CEA is explained mainly by a more extensive operation than previous year. Which is a result of all the acquisition we have carried out. As a part of the rents, CEA corresponds to the level here in the first quarter. A marginal reduction compared to previous years. The financial network rose to 56 million. The higher financial network compared to last year is explained by a greater debt volume. Which is a result of all the acquisition we have carried out. In summary, this means that the management result rose to 93 million. Which corresponds to a growth of 43% compared to Q1 2024. If you look at the management result per share, it now increases by 33%. We had value changes in our management facilities via the result calculation of 62 million. And I will come back to that a little later. Value adjustments on financial instruments at plus 9 million. And in its entirety driven by value adjustments on our rent swaps. Due to fluctuations in market rates. If we look at the cash flow from the current business. Pre-change and moving capital rose to 85 million. And that corresponds to an increase of 55% compared to previous years. And the higher growth in operational cash flow compared to management results. Which is explained by a lower current tax. Which I think we have been talking about earlier this quarter. Current tax as part of the management result is now down by 10%. Compared to 16% 12 months ago. And that is an effect of optimizing our tax-based value reduction measures. We have come to the knowledge and prognosis. The income margin is an overview of the company's ability to generate results. Due to the real estate that has been added on April 1, 2025. And given the current debt volume at this time. This indicates a management result of 385 million SEK. On a 12-month basis. And this is an increase of 41% compared to one year ago. The management result of the stock market is determined by the income margin. To go up to 2,85 SEK. And that corresponds to an increase of 23%. In the last 12 months. The increase in income margin is largely due to the acquisition. But also a more optimized cost structure. Connected to both real estate management and financing. And the contribution to the increase in income margin. Direct excise according to the income margin. The income margin is 6,7%. And the tax-based value is 2,6 times. When it comes to the prognosis for the year of 2020-2025. We determine that the management result will go up to 375 million SEK. For 2025. Given the current acquisition. But exclusively the large acquisition of the AcreNova portfolio. The reason we have not included the acquisition of AcreNova in the prognosis. Is that the acquisition is required by the decision on the sales year. May 6. But as I have communicated earlier. There is a voting requirement from the larger shareholders on the sales side. And we therefore count on a resumption of an updated prognosis. After May 6. If everything goes according to expectations. And the business will be ultimately unwarranted. The prognosis of 375 million SEK for 2025. It means an increase of 10 million SEK compared to the prognosis. We communicated in connection with the withdrawal of our book closing. The increase is mainly explained by the acquisition. We did in Jönköping for 520 million SEK. As we have both agreed and implemented. During the first quarter. So after we released the previous prognosis. And thus the mirroring of the prognosis also reflects the effect of the obligation. We have emitted during the quarter. And also the refinancing of the bank loan that is implemented. Then I can finally comment on the difference between the acquisition capacity and the prognosis. And here. I can underline that the acquisition capacity reflects the added assets per April 1, 2025. While the prognosis also reflects the agreed assets. And the effect from the day of the acquisition to the end of the year 2025. And the same goes for the financial network. Here, agreed events are included from the time expected to give a result effect. While the acquisition capacity is more a mechanical calculation. Where the financial network is estimated as average income per April 1. Multiplicated by the debt volume in this date. And the difference between the acquisition capacity of 385 million and the prognosis of 375 million. This is explained in the largest part by. The acquisition capacity is considered to be the effect of the 12-month acquisition in Jönköping. Which was done during the quarter. And the prognosis reflects the effect of the acquisition in the year 2025. The portfolio was added on February 28, even December 31. Then when you look at the real estate value. For Q1. We value all our properties every quarter. By external evaluators. As Jakob was saying, we who work with the company. We think it's very fun to be able to report that Emilshus now reached. A new milestone where the real estate value. For the first time, exceeds 10 billion. The number of managed square meters. The amount of surface area exceeds 1 million. This means that the real estate value has increased by 1.1 billion. Compared to the same time period a year ago. This is mainly due to the acquisition that has been carried out. Of course, the reported drift netto. This means that the direct The unrealized value changes via the results. The calculation now reaches 62 million. This corresponds to less than 1% of the real estate value. Then some comments on the financing. We have been active during this quarter. We have refinanced the bank loan of 400 million. To substantially improved credit conditions. We have a longer capital binding period. We have invented a new obligation of 400 million. To attractive credit conditions. The margin increased to 250 points. Over three months. The refinancing has meant that we have handled our capital outflow. In good time. We have achieved a lower credit margin. Longer capital binding time. And better distribution of capital outflow over time. We have also implemented a new emission of preference shares. 267 million per quarter. We noted a great interest in the preference share. Which was fun. It can be noted that most of the liquid from the emission. Is listed as a source of income for the Q1 report. This has to do with the emission not being fully regulated. We have now after refinancing a capital binding period of 2.8 years. To compare with 1.6 years ago. The rate of insurance has increased to 71 percent. Of the average time of capital binding 2.6 years. The average interest was 4.2 percent. To compare with 4.7 percent a year ago. The interest rate has increased to 2.8 percent. The rate of capital binding per Q1. Has increased to 2.1 times. For the rolling 12 month period. And the rate of deposit was 55 percent.

Yes, if we look at the owner list. No major changes. It can be noted that the 4th AP fund. Has acquired some of the stock stocks in the company. So it is the big change. If you are going to put a big change in the company. But still a stable and good owner image in the company. If we look at the future. It is super exciting. First of all, we do what we should do. We said here for a while. That we would expand in southern Sweden. Then we got the question on a capital market day. When? On what day should it go into Öresund? Yes, now we have done it. And that is very good for the company. That we are growing geographically. The possibility of growing the company in more places. Buy a good house with good tenants. And above all in the areas of the lagging and light industry. Topped also with good trade. So 25 can be a very good year for the company. It has started well. Then we will see the rest of the year. But there are opportunities for us to grow further. Then we will focus on the region of Öresund. Until then we will make a purchase in Småland. Then we will have a little more of the property. Then it is the usual work to work with our tenants. Keep control of the cost side. Re-exchange. Extend our rent agreement with the existing tenants. And then also be active. Always active on the financial side. We have to be out in the capital market when it exists. And when it meets the business we are going to do. We are not a company that is just waiting. We take in money when we think there is a reason to do it. And that it should be met with that there is also a demand to handle in the near future. So we think Q1 was a fun quarter. We will continue to work as dedicated as we have done before.

Thank you so much. Before we go into the Q&A, if you want to ask a question, press star 9 to pull up your hand. And then star 6 to activate yourself. The first questioner is Albin Sandberg from Keppefjörö. Please say the word.

Hello and good morning to me. I thought you were in there a lot with the acquisition and so on. I was thinking a little about what is possible for the rent organization. To do more in the border here now, like balance counting. Or will you need to grow here. Everything has gone pretty fast, I think, at the end. But it is positive in one way. But we will take care of it too. There are no such problems.

It is necessary to build a strong organization as it is. We are already working on that. It is about establishing a management office in Skåne. Then we look primarily at Malmö. The process is already started. We have also strengthened the management area in Almstad. We have there employed people in Växjö. At our headquarters. We also get a new head of housing after the summer. We build the organization to become a bigger company. Then we do not put on a big CEO that we sit with people who wait. We try to meet capital for business. That we meet a sufficient management capacity for the personnel. But we have in this time employed. That is one part, I think, you mean. The other is also that we have expanded a lot in volume. That is, we have developed many properties that we will deal with. And we will do that in the right way. Have we paid to do more business right now? When we start to stand a little bit in the ceiling. At the same time, there is a capital market to go out in. So we do not feel so worried that we can not grow the company. But it is about in some way to take care of what we get in. But also to do the best for the company to grow. But it should be built in a structured and balanced way. But then I do not think we fly out too much. We have still said that we will expand in southern Sweden. Which we did now. So we do not fly out too much, we think. But we still have control over it all.

That sounds good. And then, I would like to maybe just go into it. But I think I read that the period of termination, the financing costs were up 20.25 per quarter. What was it that drove that?

I would say that it is a combination of the mix of different capital sources. We have a new obligation in the result calculation for Q1. Which we did not have in Q4. We have done a lot of different refinances. We have the development of the derivative portfolio. So it is a combination of all these factors that make the average interest go up by 20 basis points. Compared to the fourth quarter of the previous year.

And of course, the capital sector, is it a reasonable level to expect here in the future, if you think that the interest rates are low?

Yes, it is possible to count on that. From how we prepare in the quarter report, under the financing section, how the derivative portfolio looks like. And how it falls in time. It goes quite clearly there. I would think that everything else would equal the average interest up a bit over time. If you were to do that exercise and count on a reasonable credit margin, a reasonable long-term interest rate for us, I think you would get a slightly higher average interest rate over a long time. Since the interest rate would not move anything on it.

It is a bit of a struggle in the market, I expect more time to scan, but I have to take it myself. It is better so to

speak.

No, but it is great. That was my questions. Thank you.

Yes, thank you. Thank you very much. To repeat, if you want to call in and ask a question, press star 9 to pull up the panel and then star 6 when you get the word. We can go on and ask some questions that have come in. How do you experience the bank's interest? In what interval are your credit margins with the bank today? And how is it different from 6 respectively 12 months ago?

We experience the bank's interest as very good. And it is not only us who do, but the industry in general and especially within the segment that we are in, the light industry, is quite so, it feels very positive to the banks right now. But then it is so, the credit margins go up and down. It is the question of interest on the loan in the end, it is about. And to answer the question of how much down in 6 and 12 months, yes, what should we say then? I would say that in any case, maybe 30, 40, 50 points down compared to 12 months ago. It is always difficult to compare, you may not have a case that is exactly like for like. But something in that style is what we see.

Thank you very much. Then we go on to the next question. What kind of space do you wish to have compared with risk restriction and a maximum of 60% debt rate? Do you decide to continue to finance your expansion partly on your own capital or do you also evaluate selective additions of assets?

We have reached a size where we can both work with acquisition and also with deductions. And it is clear that we will refine our stock. Then we have no stress in doing that, but we want to get it easily paid if we go out in the market. But in the coming time, we will now do both acquisition and sales, but it will mainly be trust, which we are very hungry for on the acquisition side. Connected to our risk restrictions, we will be under 60% debt rate, and we will not be at 60% either, or how, Emil, but we will be under. And then maybe we talk somewhere, 57-58%, but I mean, we can reach 60% over a period if there is acquisition to do. And it will be debt-based in a certain way, but in the long run we will be

under 60

% in any case.

Yes, exactly. And then we can add, we also amortize. The majority of bank loans are in some form of amortization pace too, which makes everything else equal and debt-based over time.

Thank you very much. Where in the Öresund region are you most eager to expand?

Yes, now we have made acquisitions in Helsingborg, the island's crown in Malmö above all. So it's probably the three cities we're looking at. We have also done in Trelleborg. So you could say 3 plus 1. So that's where we're focusing right now. And it's like strong, good markets. There is a big exchange, we already notice that. We have received many business proposals since we went out with this business, which we find very exciting. So that's where our focus is. And what we said earlier, if we want to increase volume, it is mainly in the Öresund region and complete purchase in other areas. Then it's like that, a good business is always a good business.

Thank you very much. That looks like all the questions we have received today. Thank you so much, Emil and Jacob for the presentation. And thank you to everyone who has watched. Have a nice week of Volvo when it starts here.