JM AB (publ)

Hej och välkomna till JMs delårsrapport för första halvåret 2024. Mitt namn är Mikael Åslund. Jag är ny vd och koncernchef i JM. Vid min sida har jag Tobias Bjurling, våran CFO. Nu funkar inte den här.

Let's see if we can, with the help of the technician... There we go.

J&M's revenue in the first 12 months is 12.9 billion. Our business is still in three countries. Sweden has 68% of the revenue, Norway 19% and Finland 13%. Vi har antal byggrätter på 37 200 nu. Vi har minskat antal anställda ytterligare lite grann. Nu är det 2076 anställda. Det är en minskning med drygt 300 anställda på det senaste året. Börsvärdet är 13,3 miljarder kronor. Funkar inget bra? Klicka. The revenues in the first half of the year decreased to 6.6 billion, approximately one billion decreases in one year. The movement result also decreased to 329 million and the movement margin decreased to 5%. As a result, the results per share have also decreased. The cash flow from the current business is negative for the first half of the year, minus 285 million. We are happy that the cash flow in the second quarter is positive. As a result of production starts, we have a sale of Dyre Värskulle, a property rights project, and we have received a purchase discount for a sale in Norway of developed land. If you look at our In terms of sales in the past year, despite limited purchasing power, we have sold 1,555 homes in the first half of the year, which is significantly better than last year. We have started 867 homes, of which 722 were in the second quarter, as a result of increased sales. Unfortunately, the number of homes in progress is still decreasing. It is now just below 5,000. We have, as I mentioned earlier, continued positive sales development- during the second quarter. Especially towards private customers in Sweden- and towards investors in Finland, we have managed to sell properties. We have also sold rental rights projects to investors in Stockholm- and last week we sold a rental rights project in Riks in Uppsala. Also to investors in 134 homes that are starting production in the third quarter. The good sales have led to increased production starts, as I mentioned. Unfortunately, we have lower revenues, lower turnover and margin, due to the low production that we still have, also due to price drops and the high cost level that arises in the project. The good news, however, is that despite the fact that we started 722 homes in Q2, our rate of booking increases, the share sold and booked in ongoing production, to 58%. This was 54% at the change of year, 55% at Q1. So it is very positive that it is increasing. If we look at the whole, we see that the result is relatively stable in Norway, Finland and real estate development compared to one year ago. However, it looks heavier in Stockholm and Riks. I will return more to the different segments soon. Prices on the second-hand market have strengthened on all of our markets, even though it has come late in Finland and Helsinki. We see that inflation has decreased with the first two rent reductions in Finland and Sweden. has strengthened the whole and price development has increased. In Norway, the decline in inflation is a little later, so we estimate that the first interest rates will come next year. But despite that, there is a good price development in Norway. The different units we have increased in all units in sales, in addition to Norway, which is marginally lower than the previous year. The joy here is that Stockholm greatly increases sales. And as a result, we have started more production. It can be noted that we do not start production so much in Riks in the first half of the year, but we estimate that we will start more projects in the second half of the year in Riks. Some projects, examples of what we have started. The first project is a milestone for us. We start the first stage in Marieviks udde. According to me, it is one of Stockholm's finest new production projects. It is surrounded by water, just a short walk over to Södermalm. The first project is designed by Vingårds. It is 135 apartments. The interest is very large for the project and we have a price tag of 120,000 kronor. Then we started a small house project in Uppsala, Sköldstadalen. This is stage four, I think, of many stages. It is a larger small house project. The interest in this project is also large. We have a price range of 36,000 kronor per square meter. We have a rate of booking in the current situation of 37 percent. So it's good to sell there too. Myrvold station has also started a project. The first, the seventh stage is just south of Oslo. We have a price range of 80,000 kronor per square meter in Myrvold. And I think we have booked and sold 43 percent of this project. So it's going very well to sell. And then we have sold some projects to investors in Finland, as I mentioned. One of them is GV6, which we have both sold to investors and started production in quarter two. I mentioned this, you see that it turns up. We have 58% sold and booked housing in ongoing production. A lot of joy, despite more production starts. We also see that the number of homes in ongoing production has decreased since we topped at around 7,000 homes in ongoing production. Now we see that we are going down, we are just under 5,000, at the moment 4,900, but a tendency to plan out as we start more new projects. We hope that it will go quickly. If we look at this table, we see that we have a lower number of homes in ongoing production, but we have a larger number of sold and booked. What we are focusing on here, and which is positive, is that the number of unsold homes in the balance sheet goes down compared to the year shift. It is in parity with Q1. Now we have 153 homes in the balance sheet. The focus for us is to sell away the homes that are in the final project. You can see that it has increased to 393 homes now. But we are actively working to sell them away so that they don't need to be included in the balance sheet. Let's move on to the different business units. In JN Bostad Stockholm, both revenue and turnover have dropped. We even have negative turnover and turnover margin in the first half of the year. A positive trend, however, is that we sell more, we start production more, and in the second quarter, the turnover is around zero, four million plus in the second quarter. The market in Stockholm is characterized by large sales on the retail market, but lower sales on the new production market. This can strengthen the price image for newly produced housing. We see that customers have a greater willingness to sign early in the project, which is positive, and we have a good cash flow in the second quarter due to the fact that we have started producing more housing. and thus we get lower investment in exploitative properties. In JN Bostad Riks, the revenue, turnover and turnover have also decreased compared to previous years. We have increased the number of sold homes, but we have not started production as many homes in the first half of the year. But we are counting on starting more in the second half of the year. Also here, customers are more willing to sign in the early stages and the cash flow is positive. In JM Norway, it is relatively stable. Even if we have a slightly lower income level, the results are in line with how it was last quarter and last year. So a margin in the first half of the year of 8%. Here we see that the demand for newly produced housing was relatively low. We have a slightly lower sales in the first half of the year than we had last year. Kassaflödet är även här fortsatt bra och vi har fått en likvid här för en försäljning som vi annonserade i Q1. In JN Finland, we see a higher level of income and moving margin- in the quarter than before. On the half-year shift, it is in parity with previous years. We increase the number of sold and production-started homes. In Finland, the interest among private customers is relatively low- but we have succeeded in selling well to investors. Here we have sold two projects, GWS and one called Lotus Rinne 15- a stage in e-sport in a larger area. Both sales and production started in Q2. The cash flow here is also positive, just like all other business units. Real estate development, still good results, largely due to the office project in Karlberg, which we have sold to the Fortification Agency. And here we also sold a property rights project, Dyverskulle, which is finished, which generates cash flows, which was positive in Q2. We also sold an ongoing project called Flora and is in Järfälla to an external investor. It will be successfully produced until the end of 2025. So now we have four ongoing projects in production that successfully produce results in property development. Vår byggrättsportfölj har nu 37 200 bostadsbyggrätter. Den har minskat något jämfört med föregående år. Vi är fortsatt restriktiva med förvärv, men vi är redo att köpa när vi hittar bra förvärv med en bra prisbild. Tobias, ska du ta över?

Yes.

Hopes den fungerar nu. Beklagar verkligen att vi har lite tekniska bekymmer. Men jag hoppas att ni kan se våra bilder nu också. Ja, om man tittar på vår balansräkning och marknaden som ligger i balansräkningen, så har den också sjunkit något i kvartalet. Det är också i stor del tack vare, eller tack vare på grund av att vi har fått igång så många starter i kvartalet. As Mikael said, we are careful with new acquisitions, but we have still made some money, especially in Stockholm this quarter. The balance sheet is 8.1 billion kronor. It corresponds to 22,100 building rights in the balance sheet, which is slightly lower than before, but still a very strong building rights portfolio. We also see that we have increased production starts over the past 12 months, which means that the turnover time is now down to 12 at the beginning of this quarter. We have a value of 5 to 6 years, but we now see that if the starts start, the turnover time will also quickly decrease. At the beginning of the quarter, we had 153 homes in the balance sheet. The value of those increased during the quarter, and that is due to the fact that we have a different mix with a little more homes in Sweden with a higher average value. But we still see that we have a return on these. That is what is important for us. We see that sales have taken speed and that we return the balance so that they do not remain in our balance sheet for too long. If we look at our cash flow, we are very happy to see that we have a very positive cash flow. Much better than previous year and also better than the same quarter previous year. The big difference is that we have started the start-ups. We get a positive cash flow when we move our building rights into production. And we also have a strong positive improvement in the change in the cash capital, so that our short-term debt and interest rates have a positive cash flow during this quarter. We have also been able to amortize a lot of our loans, as we see in the cash flow from the financing business. This means that when we go out of the quarter, we have strengthened our financial position, we have a good payment capacity and a long-term liquidity of 3.3 billion. We have signed new RCFs, which means that the unused Czech loans have increased to 2.8 billion per quarter. And the average period is 2.4 years. If we then move on to our result components in the housing business, we can see that the cost-based effect is based on the amount of worked costs we have times the forecast we had at the beginning of the quarter. It has increased thanks to several start-ups. We have a positive evaluation effect. It was lower than normal in the previous quarter, when we had to lower prices. Now we see that the trend looks better. We have been able to increase the forecasts and get a positive evaluation effect in this quarter. We also see that we sell more than we start, and therefore we get a positive sales effect. And if we look a little deeper at the environmental effects per business unit, we can note that we still have a negative environmental effect in Stockholm, where we have had to make additional small price adjustments, while we then have a positive development in the rest of the business segment. And with that I thought I'd bring it back to you, Mikael.

GIMS's work with sustainability is central to us and has been for a longer period. We are working towards reaching close to zero carbon dioxide emissions. And we have also made a number of decisions this quarter that lead in that direction. The first decision is that we say that 80% of the factory concrete on our construction sites should be at level 2 or better in Sweden and Norway. And that means that the emissions of carbon dioxide of carbon dioxide should be 20% lower than the norm, the norming amount. We have also said that we will introduce more comprehensive analysis processes with regard to climate risks in the early stages, when we are in the transition stage and the detailed planning stage. So we plan the project in a different way. We will evaluate these at the end of the project and summa summarum, this should be able to generate that there will be more cost-effective and safer that we can adapt our projects based on the existing climate risks in earlier stages. Then we are proud that we were noticed in the Financial Times as one of 300 companies in Europe and one of 50 in Sweden, which reduced their actual emissions most over a five-year period. It is a criterion for our work to work. We are also proud that we have maintained a mark called Best in the construction industry regarding equal working conditions, which is also a focus for us. Summing up the current situation for JM, it is extremely important for us that we have a great customer service. We are customer-focused. In the previous report, we mentioned that we had the highest NKI in the industry in Norway. We also had the highest NKI during the guarantee period in Sweden, which is great because customers have lived there for a few years and are satisfied with our housing. It is a quota that we have quality housing. that the customers are attracted to. The building rights, a nice portfolio in attractive locations. If you look at the long-term conditions, we assess that in those three countries we are active, that those countries are attractive and people will need quality housing in attractive countries in the future. So there is a little discussion now about how big the need for housing really is. But in summary, a little bit of housing is being built in relation to what is needed, regardless of the discussions. And then we are well equipped at JM to be able to meet the demand that will exist. We have a good structure, we have a fantastically committed employee, we have good financial conditions and our building rights portfolio, which means that we will be able to take a position in these markets. We work with sustainability, as I mentioned earlier. Climate is an important aspect, where we appreciate that authorities and decision-makers are active and quite offensive when it comes to setting requirements and goals for us to improve the climate. We also work a lot with the work environment. Reducing the work environment risks in our buildings is central to us, and of course with equality. The housing market. We see some glimpses in the housing market. We have lower inflation. We have the first rate drops in two of our countries. And the customers are generally more positive about the future prospects around the credit line. So prices are going up somewhat, but it will take time in our assessment. Customer purchasing power has been greatly reduced by inflation in recent years, so the cost picture has gone up and prices are still lower on many markets than they were when they were the highest. So we estimate that it will continue to be a watchful housing market in the future. As Tobias has mentioned, we have a well-balanced and balanced risk profile. And we will continue to continuously adapt to the current market situation. As I said, we have adjusted our staff, and we are also looking at our overhead costs. And it is also important that we work with our costs and efficiency in general in order to be able to start more projects. And there we have a good base in our structure and our competence that exists within the company. So the work with efficiency, I aim at intensifying it here in the future. And then we will rush the re-adjustment somewhere for us as a company and the adaptation to the market. So, tack för oss. Det var presentationen och vi är redo för frågor.

We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their Samsung telephone. You will hear a tone to confirm that you have entered the queue. If you wish to remove yourself from the question queue, you may press star and two. Anyone who has a question may press star and one at this time. Our first question comes from . Please go ahead.

Good morning. I have a question regarding the marginals in Stockholm. I note that 0.3% EBIT was very low. How should we think about the marginals here in the future, even though it underperforms both Finland and Norway quite strongly?

The margins are pressed due to the market situation, which is partly due to the higher cost picture, partly due to the lower price picture. We assess that it will be improved successively in the future, but it will probably take some time for the market to fully recover, especially when it comes to the purchasing power of the customers.

Okay, when it comes to price adjustments, you have had quite extensive price adjustments, but at the same time we notice that housing prices are starting to rise now, it's starting to look a little better. How large is the reduction in prices on the projects that exist now?

Vi justerar priserna i de fallen det behövs. Min bedömning är att det behövs mindre nu. Det är snarare på objektsnivå och kanske till och med lägenhetsnivå, bostadsnivå, än på projektnivå för tillfället. Objects where it's the hardest for customers to buy are small apartments, where there is one in the household. Where some authority requirements, for example, the other amortization requirement, have made it difficult to finance their business. So a little less price adjustments, since the price picture goes up. That's the assessment for the case.

My next question is when it comes to the completion of production in the coming quarter. In Q2, you are selling quite well, but the inventory level is more or less unchanged, and so is the capital bond in unsold housing. Could you say something about how the completion of projects will look in the coming quarter, so that we can get an indication of where this figure is going?

It's completely dependent on whether the sales continue. But of course, we also have plans for later this year. But as long as we can maintain the sales, we hope that we can stay at these levels. But in a single quarter, the balance can go up or down. But we see that the trend is that we increase our sales and we will try to maintain this level of pre-sold and unsold over time.

And then also a question when it comes to starting with you in Riks. And you mention a project where, if I'm not mistaken, the sales price was around 36,000 per square meter. What does it look like to start a project outside of Stockholm, considering the high building costs?

Even outside Stockholm, as we said, we have pressed margins due to the cost picture and the price adjustments that have been made. New projects we start, then of course we do not need to price adjust, and there we see that if we put prices in this market, the price becomes more correct. But the margin is not exactly at the levels we want in the long term, so somewhat more pressed margins in some projects that we start.

My last question is about Flora, which you mentioned in the Q2 in the PNL. What was the degree of completion of that project initially?

I don't have the exact figure, but I know that apart from the land cost, we had already reached a bit in production, so it's a bit higher than just the land cost.

Okay, that was my question. Thank you very much.

Ladies and gentlemen, there are no more questions over the phone.