KlaraBo Sverige AB (publ)

Welcome to Clarabo Q4 Report for 2024. For the first part of the conference call, the participants will be in listen-only mode. During the questions and answers session, participants are able to ask questions by dialing pound key five on their telephone keypad. Now I will hand the conference over to CEO Andreas Morfiadakis and CFO Per Holmqvist. Please go ahead.

Välkomna till Klara Bo's rapportpresentation, bokslutskommunikering 2024. Idag är då Sifo och Per Omqvist och jag själv Andreas Morfedakis som ska dra er igenom vår rapport som vi då släppte här under morgonen. Det finns ju en hel del positiva saker att gå igenom idag. Bland annat så levererar vi ett resultat som är väldigt tillfredsställande. Där vi har ett ökat förvaltningsresultat och vi har även en a very good and positive value association for properties, thanks to the fact that this year's rent increases for 2025 have come out higher than what we previously assumed in the valuations. We also have a more normalized year than last year. and lower interest rates, which then means that both the management results and the results per share land much higher than what we had in 2023. In addition, we have carried out a large acquisition We have had a heavily overtaxed performance emission, we have loan refinanced a large part of our portfolio to favorable conditions. And we have also taken further steps to increase the energy classes of our facilities. But if we take one thing at a time. We started the quarter by refinancing 1.8 billion out of our portfolio in advance. We had a lot of big declines here during 2025 that we chose to deal with quite early in the fall. And that corresponds to 35% of the portfolio. The collaboration we have with our banks has been Very constructive during this more challenging period. And somewhere we notice that it has brought fruit during this process. And we, following this refinancing, then also sunk our entire average income at the time with a total of 15 points. So a good sign that we have confidence in the banks. And at the same time, of course, a sign that the market also has opened up, a little anxiety has disappeared as it has been before, and it is now quite obvious that there is more room to actually become active in growth. After that, we worked quite hard during the fall to try to implement one of our largest acquisitions so far. At the end of November, we announced that we had chosen to greatly increase our stock in Helsingborg with a total of 740 apartments. In connection with that acquisition, we chose to make a sales emission of 390 million. where we then asked our shareholders for assistance. And it followed well during the later part of December and the beginning of January, which then was greatly overshadowed. In addition, we have actually also taken up some new bank loans during the January month for the remaining part of the financing of the acquisition of the entire 510 million. And also in that transaction we have experienced that the loan margin has dropped compared to what we have so far in our books in our average margin. So a very good market anyway. Then we also have during the quarter arbetat ganska aktivt med att gå igenom alla fastigheter. Det kommer ju en del nya direktiv när det gäller energiklassningarna på fastigheterna. De behöver då vara uppfyllda till 2030. Att F&G energiklasser då behöver förflyttas upp ett antal snäpp. Vi har gjort en djupdykning i Among our facilities, we have found that only 14% currently have an energy load that is outside of what will be the directive. We have also identified what measures to take to move these facilities. Our assessment here and now is that it will mean an investment that will go up to 25 million SEK by 2030, which we will also be able to see that there is a fairly good discount of up to 10%. Many of these investments are taken running under our planned maintenance, so there are no unforeseen expenses in this way, but we see it more as an access. And then we have also talked during the quarter, or of course had a full list of rents for 2025. Under this process, we felt that the whole process started much earlier than it had done in previous years, and we felt that there had been a A more structured process, and it has gone much faster than it has done in previous years, which is positive both for us and for tenants, of course, and the market in general. And in the current situation, we have almost 75% of our entire portfolio ready for negotiation now that will start ticking. in the beginning of 2025 and most of it will be available in the quarter for Q1. The indication right now is that the weighted average will then land at about 5% which will be compared with KPI at about 1.6% if I remember correctly. So it is positive, which means that we are actually improving on what has been lost, connected to the higher inflation in recent years. Finally, during the quarter, the Board also chose to update our financial and operational goals, and they are in practice The only new goal we have come up with is that we have made it clear that our interest rate should not be below 1.75 times and that we should have an LTV level that does not exceed 60%. Så ett väldigt aktivt kvartal som vi då summerar egentligen med ett antal siffror. We are very pleased with the financial development of the company. In practice, all key figures have been strengthened during the quarter. Income has gone up, the power grid has gone up and the administrative results have gone up. The administrative results go up by 31% compared to the previous year's corresponding period. And it is clear that there is a lot of explanation for this here, of course, and Per will go through it very soon. But that means that we are very pleased with the development of the quarter and it gives us a continued financial stability for the future. In addition, in previous assessments on properties, we have underestimated how how big the rent will actually be. This quarter has meant that we will get a pretty big positive value change on the whole net, the whole 132 million kronor, which of course means that the result per share will be very good compared to the previous year. ICR, interest rate 1.8 and an LTV level of a stable 51%. And then Per will go through some figures.

Thank you Andreas. Yes, if we sum up the results for the fourth quarter, we have positive value changes, which is a big plus in the result calculation. And a little more broadly, I can say that we continue to compensate for the high cost inflation that has been the last few years. In the quarter, the rental revenues increase by 5% compared to the same quarter last year. In the comparable stock, the revenues increase by approximately 6%. This is mainly due to the general rent increase, but also that we invest in renovations, which also generate revenues increases. If we look at the cost side of the property, then our property costs decrease by 4% compared to the same quarter last year. This is partly due to the cold weather in 2023, when we had quite high costs for snow removal that we have not had this year. If we look a little further down in the result calculation on financial costs, we have a slightly higher average loan volume and we have also had some drop in possible interest rates, which means that financial costs have increased somewhat. This is partly due to the fact that the market interest rates have dropped a good bit. If we then look at the administrative result, it increases by 31% in the quarter, which is very, very strong, we think. We have already touched on value changes a little bit, but 132 million kronor in the real estate and 73 million kronor in the derivative portfolio. When it comes to the derivative portfolio, this is explained by these declining Sorry, we have had some rising expectations related to the interest rates that have made the derivatives have increased in value. Yes, if we are going to try to summarize 2024 a little more clearly, then the clear housing management result per share increases by more than 9%. The profit for the whole year is improved by 569 million kronor compared to last year. And that corresponds to 1.44 kronor per share. Vi berörde värdeförändringar i fastighetsbeståndet i resultaträkningen. Det får också en effekt i balansräkningen där fastighetsvärdet ökar. I kvartalet så ökade exit yield in the valuation with three points. Underlying would have meant a negative value change with SEK 70 million, but just as Andreas mentioned, we have received higher rent increases than the assumptions we have had in our valuations, which has meant that we get a positive net effect of SEK 132 million. The remarkable thing we can see in our balance sheet is that interest increases by 400 million kronor. This is connected to our performance emission that is now implemented. From 31 to 12 it was still ongoing, which is why we had increased interest but also an increase in our own capital on the corresponding amount. Finally, it is worth mentioning that our loan rate is still at a good level, at 51% and we have a debt portfolio that ultimately consists of secured bank financing. If we then look a little deeper at the debt portfolio, then 80% runs to fixed interest. We have an average interest rate of 3.3% on the balance sheet. It is then somewhat lower than it has been during the year. It has fluctuated between 3.5-3.6% and is now falling back. This is due to the fact that we have refinanced 35% of the debt portfolio to significantly better conditions. But it also depends on the fact that the market interest rates have gone down. The total nominal amount of the debt portfolio went up from the balance sheet to 4.9 billion. The interest bond time went up to 3.3 years. We have a debt portfolio with high predictability, a high rate of return, and the fact that we work with final insured bank debt also means that the risk can be relatively low. If we look at the interest rate, it is per 31-12 2.1 years. Vi har en ökning i kortfristiga skulder som då uppgår till cirka en miljard på balansdagen. Diskussionen om refinansiering är påbörjad med våra banker och vi har fått positiva signaler. Förfallen skedde i Q3 2025 och vi har gott hopp om att kunna genomföra den här refinansieringen till förmånliga och konkurrenskraftiga villkor. Finally, I would like to sum up with the ability to earn income. Before I hand over the floor to Andreas again. On January 1, 2025, we have a momentary picture of the group. It is no prognosis, but it is as it looked on January 1. As of January 1, we had concluded rental negotiations that correspond to 66% of the rental value to the portfolio. The rental increases ended up at 4.9%, which you can see on the income side here, which increased by 21 million kronor. When it comes to property costs, we see that they are fully indexed for 2025 in this summary. So it is a somewhat halting income, one might say, where 34% of the rent value remains to be indexed. And the indication there is, as I said, that it will land on about 5%, that rent indexing. Financiella kostnader minskade med 6 miljoner kronor jämfört med föregående år. Det är framförallt på grund av de refinansieringar som är genomförda men också då lägre marknadsräntor. The rent technical rate went up to 2% in this moment. And since last quarter, the management result has increased by 5%. And that is mainly due to rental negotiations and lower financial costs. Thank you for me and I hand over the floor to Andreas again.

Let's move on to our portfolio. Last December, it looked like this. That is, this large acquisition in Helsingborg was not consolidated on this date. The number of apartments increased to just under 6,700 during the administration. where we have a real rate of payment of over 97%. It has gone down a number of points compared to earlier, and that has to do with the fact that it is still a fairly lagging rental market in general. We have noted that in the last quarter, and that is what we also hear from our peers i branschen, men genom att finnas på rätt orter och erbjuda rätt produkt och fortfarande ha en väldigt attraktiv och konkurrenskraftig hyresnivå så är vi helt övertygade om att den kommer stiga igen så fort den ekonomiska tillväxten i landet kommer igång igen nu. Vi har hela 88 procent av portföljen som är bostäder. And these housing that we consider as with potential for renovation, they have an average rent that amounts to 1163 SEK per square meter and per year. It tends to be that there is a trading potential that goes up to about 40% from this level. Finally, we have a market value for our properties at the deadline that goes up to about 18,500 SEK per square meter. If we take the next picture, then we come in a little bit to the acquisition we do in Helsingborg and tell a little bit about why we thought it was so interesting. Now, of course, Helsingborg we were in earlier. We had about 90 apartments in Helsingborg before and that is the picture or the house in the picture, which is our old property. Helsingborg has been a prioritized place for us and we have found that we have had a little too few apartments on such a good and strong site as Helsingborg. So when the opportunity arose to acquire a larger estate, of course we thought it was interesting. Nu har vi då förvärvat 740 lägenheter i ett samlat bestånd i Fredriksdal. Ett klassiskt miljonprogramsområde som egentligen tickar alla boxar som vi har när vi går igenom vår checklista vid ett förvärv helt enkelt. Förvärvade fastigheterna utav Rikshem som har ägt under ganska många år. and will continue to develop these properties according to our model. The price for this was 850 million kronor. This corresponds to a square meter price of about 15,000 kronor per square meter. And we mean a fairly low price in a very good place like Helsingborg. It also means that we have calculated that we have an initial drop during the first year that will exceed 5%. And that of course will be valuable over time for the company. Then, of course, the most important thing here when we look at this type of acquisition is of course that we want to be able to see that there is a trading potential. And often you can see how demand for housing is generally in the area, but we also look quite a lot at what the average rent per square meter is at the time of acquisition. And then we have actually noticed that they that we consider not renovated at all, that have a potential for sales, there the average rent is 1127 SEK per square meter during the change of year. And since we have been on the site since earlier, we know what rent you can get out after such a renovation. And it goes up to just 1600 SEK per square meter. an increase in rents of over 40%. With that said, and that we have somewhere between 6-8% of a discount on that, and that the entire 64% of the portfolio has this potential, we experienced that this business really ticks all the boxes that we are looking for in a transaction. So then we thought it was an obvious opportunity for us to carry out the business. And we have done so now, and the business was established on January 31st. Thanks to a performance emission, as we were talking about, and new banking financing. The acquisition in Helsingborg is a good example of how we have developed the business over time. Its strategic position and potential for sales is in line with what we have said is in line with Klarabors growth strategy. Our starting point has since the founding in 2017 which offers attractive apartments for reasonable prices. We have mainly built our property through strategic acquisition of portfolios and a focus on self-management, and thus a concentration of the property. In common with the acquired property is also that it has a significant trading potential. In this picture, you can see Boverket's published figures in January, which shows the estimated annual need for newly produced apartments per 1,000 inhabitants for the period from 2024 to 2033. This has been revised according to previous forecasts. The darker the color, the greater the need for new housing. And then we have called in the black dots, which are the population and where the size is actually made up of the property value. And then you can actually identify that these dots match the geographical areas where there is a documented shortage of housing and that the new building needs to be at a relatively high level in the coming year. At the same time, our mentioned acquisition in Helsingborg has contributed to further diversification of the property estate. And now we have four strong clusters in the form of Helsingborg, Trelleborg, Visby and Östersund. Only these four stand for more than 50% of our portfolio. Samtliga dessa städer är ju att betrakta som starka tillväxtstäder med stabil befolkningsökning och en betydande infrastrukturprojekt i respektive ort vilket då såklart är en trygghet. Tittar man då också på Värderingarna på de här orterna så ser man ju då att kvadratmeterpriset är ju förhållandevis, eller är ju väsentligt mycket lägre än vad man då har i storstadsområdena ju. Och om man då applicerar helt enkelt att man, vårt avkastningskrav, vår gil som vi rullar och går här och nu, So kan man ju då titta på egentligen vad är det för typ av hyror vi behöver få ut från befolkningen på de här orterna för att vi ska kunna leva upp till våra värderingar ju. Och lägger man då även till parametern disponibel inkomst på de här orterna som är relativt hög then we see that there is a very good payment capacity on these sites to actually be able to deliver on this trading potential, which is somewhere around 40% on respective sites. when we then increase the rent from unsold to rented. It gives us an incredible sense of security in where we are somewhere and it also shows a signal that we actually have that these are strategic areas that we have chosen based on certain parameters. And that will actually lead to us still being able to increase our property value over time through organic growth. If we then move on to our business model, and we have been talking about it quite a few times before, of course, but then it is that these properties that we then own and manage around the country, De har ett behov av en successiv uppgradering. Många av dem har ett inbändigt underhåll som har ett behov av en uppfräschning till dagens standard. När vi går in och gör det så gör vi det här såklart mot en avkastning. Den avkastningen kommer såklart påverka ett framtida kassaflöde positivt från operations. We will also see that the driftnet will increase, but we will also see that the maintenance costs will decrease over time. Vi vill ju också komma i de här orterna så vill vi gärna få en volym som är tillräckligt stor så att vi kan etablera vår egen förvaltning. Så någonstans på de orterna som vi då betraktar som centrala i vårt bestånd vill vi gärna komma upp i någonstans mellan 400-600 lägenheter till minimum så att vi faktiskt kan etablera vår egen förvaltning. De fyra orterna som vi precis har gått igenom är ju such places that have been strategic. And we have a few more places that we would have liked to have seen where our stock could have grown further. For example, Umeå, where we only have about 140 apartments in the current state, but where we think there is a very good potential to expand further. But if we look at the development The graph on the left shows the difference between the general increase in rents in the areas where we are located. The orange line is the value that we have created in addition to the general increase. These are the figures for January 1, 2025. And that means that the rent increases that were agreed before the change of year with the state in January are included, but the others are not included. So it actually means that The rental value has increased by 3.4% for the quarter, while the general value has contributed by 2.8% out of the 3.4%. So this gap is still increasing and this creates a value increase in our real estate value successively and this creates shareholder value over time as well. And in the current situation, before the acquisition in Helsingborg, we have a total of 60% of the portfolio that we consider to have the potential for renovation. If we take the next picture. What we are actually looking forward to for the coming quarter is that we will consolidate Helsingborg by the end of January. So it will be visible partly in the QE numbers. The emissions will of course be completely finalized and the key figures adjusted related to that. Vi kommer i takt med att vi märker The banks and loan margins are mainly sinking and the market interest rates have also dropped a bit. We notice that there is a greater reason to open the tap a little bit when it comes to the pace of renovation. So we will try to be a little more active when it comes to that, while Helsingborg will of course contribute positively to the fact that we will see some increased pace. At the same time as we continue with these renovations, it is of course important that we maintain a high level of real estate. It is still over 97% and that is a level of satisfaction, but it is important to feel the market all the time, to make sure that we do the right thing and that there is a capacity to pay and a demand for our products. So it is important to have an ear to the rail when it comes to our work is connected to retailing. And when we Looking forward during the year, we will of course have a real estate value that exceeds the 10 billion. We still think that The company is a bit too small and we will continue to be active on the transaction market and try to identify new opportunities during the year. We have some room in the balance sheet, which we could use when it comes to the transaction market. But it presupposes that we find the right stock in the right place and that it ticks the boxes that we have. And then finally, The increase that we have been talking about has gone very far. We only have a few places left that are not ready to negotiate for 2025. So we will most likely see an earlier effect in rental revenues compared to previous years when it comes to rental increases. And the indication right now is that they will land in the weighted average of 5%. And finally, a summary before we open up for questions. It's really just an investment highlight where we have been delivering since 2019 an annual growth in substance use of 19% and we have had an annual growth in management results of 26% since 2019 and we will continue to focus on the acquisition and trading of our existing portfolio, and also to develop the building rights we have in our portfolio, so that on the day when we feel that the new production market opens up again, we can act quite quickly. The building rights of course have a long-term value for the company as well. Med det så tänkte vi egentligen då att avsluta presentationen och öppna upp för eventuella frågor. So open up for any questions now. Any questions by the phone?

If you wish to ask a question, please dial pound key five on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial pound key six on your telephone keypad. The next question comes from Bertil Nilsson from Karl Square AB. Please go ahead.

Yes, hello and congratulations on the good result. Thank you very much. You have contributed quite a lot Helsingborg and the renewal potential there and also your lower financing costs, i.e. lower interest rates and how that affects the renewal calculation. If you look at the planning that may have been a coincidence in Q4, what does that mean in all other respects? Are we up to 40-45 units in the quarter or what do you think? Or what do you think, considering that you have Fredriksdal

It's a bit difficult for us to communicate exactly how many apartments we're going to have. We don't control it entirely ourselves, Bertil, considering that this is natural migration that happens in the stock market, so it must be the right apartments that come out in order for us to be able to do this. There are a number of apartments in Helsingborg that are in need of renovation. We have put them on hold for the latter part of the fall so that we can start renovating them. In other words, if our old stock is delivered at the same level as before, there is a good reason to think that we will have a good outlook for the first quarter when we enter Helsingborg.

I had an answer to your question. Yes, and then possibly also, if you look at the increase in value, you said that these rent increases of 5%, I got the impression that you did not consider that the tax authorities had taken advantage of you in their valuations earlier.

Yes, the valuations make an assumption about how rent increases will look like over time, and this is the ten-year cash flow analysis they do. And then you have previously assumed that for our stock, in general, the rent increases for 2025 would go up to 4.5%. Now we have come in at 5% instead, and it is clear that if you get that difference in year 1 and then calculate it in 10 years and eternally capitalize it, then it gives a pretty big effect in terms of value. Du får på ränta effekten på det hela så att säga. Det är den stora effekten vi ser i det. Med känt utfall kan man egentligen säga att det har varit ett försiktigt antagande tidigare. Tack. Har vi några fler frågor på telefon? Om inte så tänkte jag att vi har fått ett par frågor i chatten här. And then there is actually one question. High substance discount in the stock, repurchase of stocks? And there it is actually the case that the board has received a mandate in the previous year's vote to repurchase stocks. We have done that running during under 2024. We have also done this during the beginning of 2025. And we also write in the report that the board has chosen to allocate another 30 million until at least next year, so to speak, for resale of shares. So that's something we do. It's a capital allocation, so to speak, so it's always a consideration of how much liquidity we can devote to that type of activity, connected to trading, connected to acquisitions. And the board's assessment right now is of course that we have financial stability, so we can do several things at the same time. Sen har vi då även fått en fråga angående, jag läser den ordreglant då, bra gjort med Helsingborg. Jag undrar dock när ni börjar städa bland de små bestånd på udda orter. Yes, but that's not something that we may look over successively. We have not thought that there has been a huge need. I may not have thought that it was the right time or the right market to start selling off a lot of properties. The company has a need to get bigger. To be able to get a little more synergies on, for example, central administration. But it is clear that when we do a large operation with Helsingborg, then maybe it opens up that we can actually look at the fact that we can look at the fact that we can look at the fact that we can look at the fact that we can look at the fact that we can look at the fact that we can look at the fact that we can look at the fact that we can look at the fact that we can look at the fact that we can look at the fact that we can But so far we have not been very active, more than that we have tried to clean up the portfolio as we did in Borlänge where we sold off some commercial properties and acquired a real estate property in Falun with the same counterpart. We look at it all the time and it is very possible that over time we will be able to clean up the portfolio even more. Det var frågorna vi hade i chatten. Med det är egentligen prestationen att betrakta som färdig. Vi tackar så mycket för att ni har lyssnat på detta och önskar er en fortsatt trevlig dag och helg när det är dags. Tack så mycket!