Nivika Fastigheter AB (publ)

Hello and welcome to today's broadcast with Enivika Fastigheter. Niklas Bergman and CFO Christina Carlsson will present the report for the second quarter of 2024. After the presentation, a Q&A will be held. If you have any questions, please send them in the form to the right. With that said, I leave the floor to you.

Hello and welcome to today's meeting. We are Niklas Bergman, CEO and founder of the company. I am here with Christina, CFO and E-responsive. We are here with you.

Okay.

We will go to the side. I will take a short introduction about the company, if anyone is not really paying attention to us. We are a small country company that operates fast food management, design and development in Småland and Halland. We have a head office in Jönköping, where we have 30% of the property and water, about 30% and a weekly 20% and the remaining 20% in the head office on the west coast. Our business is to be an active and safe fast food owner with long-term management. We work hard to be local and work close to our municipalities and the food industry and also private tenants. This makes us well known in these areas. We have now more than a fixed value of about 11 billion kronor. We have 195 properties and a contract value of 690 million kronor, but with a surface of 5,4 thousand square meters. The biggest part is 60% of the commercial premises, when we talk about the value of the property and 40% of the buildings. If we take the rental value, we are a little higher on the commercial one. The housing properties are clearly the biggest part. I think we have come to the next page here. But the biggest part of the commercial is the industrial, offices and common properties. And a small number of shops, not much. We have a few central shops in a part of Boxhandel, but the biggest part is the industrial, law and common properties. We have a growing fixed value profile. We have then got a little curve with a lower value of the fixed value of the last year. But now in the quarter we see that there has been a balance of this and there is plus or minus zero on the values. I see that our yield is quite even now. We have lowered our rental value now, so we will see when we have released our obligation, down to 45%. And we have the growth of our long-term value of the substance, which is now about 6 billion. And we are working hard on our surplus, our drift net. We believe that it will increase here in the future. Now it is a quarter, which is 69% again, where we usually lie a little lower, because we have higher heating costs. But now we buy a whole lot of triple net properties, and that means that this stock market should increase here in the future. Next page. We have increased our rental value during the quarter, and improved our drift net, both when it comes to lower costs and bought a lot of triple net properties where we do not have so high costs. As I said earlier, we have a high rental rate, 96% of commercial properties are rented and 98% of the residents. And we have had a positive net rental in the last quarter of 5 million. And we have an incredibly high demand, actually on several of the routes, on the new three locations. In Jönköping we need to find more locations, we can not move them, we have too little empty, and even in Växjö we have about 2%. During the quarter we have completed a large industrial location for a large company called DS Mitt, called Heimatiten. It will now add 11 million in a yearly rental value. Such a property we have no costs during the contract times, at 15 years. We have acquired four triple net properties commercially, which will add 8 million in rental value and more or less in drift net. I have written a note to change, we do not change so much right now, but there are two properties and then our perforay is, which we think it is too expensive to manage these two properties that are one note, so we will leave them over here next week. Next slide, leave it to the cousin.

Thank you, and then we will go in and look a little more in detail at the results and so many of the balance improvements. We have a strong agreement with us, the income during the period has increased by 7% compared to the previous period. We have, as Niklas, a high degree of expression on locations. We have a drift net, which we say has increased by 16%. If we then look at the income increase of 7%, we see the effect of what Niklas is talking about, drift optimizations and energy efficiency. We also see a big difference in the financial net and in the previous year, where the financial net has decreased by 18% and it depends mainly on a debt that is 11% lower than what we had a year ago. Despite the fact that we are on the same average rate, we have a better result. We have a tax-saving rate of 12, which is 1.7, which is in parity with the previous year's comparable period. The perforation result has increased to 48 million, yesterday we had 21, so it is roughly a doubling. Despite the fact that per share, the wonderful thing about these quarters is 0.65 crowns compared to 0.36 per year. As Niklas said, we have made a smaller value change on the property, but we have increased to 18 million in a positive direction and yesterday we were negative at minus 62. We can continue to the balance calculation and look into it. We have a property value of almost 11 billion, which is almost in parity with the previous year. The management property is 93%, which is roughly 10 billion of these 11. We have an increase in the building of half a billion, unbuilt land with empty building rights totaling 338 million. And then these four types of net properties are included, which we have acquired during the period. The pension debt, as I said, is clearly lower than the comparable period last year. It is roughly 5 billion. After the emission we did in the fall, we have a net loan of 45%. We have no obligation loan. We have adapted to the higher interest rate, we have a pension of about 40% of our debt. This means that we are well-chosen and I could enjoy the coming pension if we wanted to. We have also granted with non-profit financing of roughly 300 million. We have 260 million in the cash register. We have a long-term interest rate of 6 billion, which gives us 60 and 70 per share. Then I leave the floor to Niklas again.

We have during the quarter, the coming quarter, and this is the last quarter until the end of the year. And that is what Smits and I talked about earlier. It is a selection of what we are doing. We have a small visit in Växjö, which is Opus, which is completed during the quarter. We have completed an industrial and storage building for Välpapp, which is called Graniten 39. We have also completed a sustainable industrial building that attracts Vardive Annamo, which is on 8000 square meters. Then we have a number of ongoing projects that will add 27 million here in the future. Most of them will probably be completed during this year. This means that we are beginning to increase our financial status in the future. We also have a rent increase on the housing side, which we did in April. It was a bit of a tactic in this that we were a bit behind the others. I think we have a good rent increase on all our housing. And we are on a vacation of 27 million. We hope and believe that we will be able to manage a few more quarters. It is a bit difficult now with the commercial side, but we think that with the diversified local rent guests we have, we can manage this. We have 600 rent guests in many different industries. We work a lot with our costs. Our energy is very important today. We try to save as much as possible. What else should I say? We have completed a number of properties and we are currently occupying two full properties. We have bought this on YIL, which is between 7 and 8 percent. We are also occupying a project that we have press released, which we will start in May. We will have 23 million in housing, where the municipality will rent 70 percent of this. It will be completed within about two years. I have also written a document in the following quarter, the Majority, which is a 20-year agreement that can now be built up to 24 power plants within two years. The first type will arrive in the fall. Together with this we will build a power plant, a kind of circle-k, but with only electricity. This together with our new main control will be provided outside of Värnamo. This will be completed by the end of the year. As I said earlier, we have several applications for new housing, new projects, especially in Värnamo, in Önneköpinga, new industrial premises, built by those we already own, which gives us quite good cash flows with the fact that we have already bought the land and have the building rights in our hands. And as I said, we have several applications for land, and especially high-cost housing, which is what we are looking at right now. Well, do you have anything to say, Christina?

Yes, we thank you for the time and open up for questions.

Thank you very much. Yes, we will go into questions at once, I think. You increased your drift network by 16% compared to the previous year. What strategy have you used to achieve this growth in your drift network?

Well, one of the last strategies has been to buy high-cost properties. We have done a lot of ongoing housing projects, and these high-cost properties are the reason why we increase our drift network, because we have lower costs. We can increase quite regularly with this type of property without increasing our organization. And then we work with savings on energy, and it works.

Thank you. Yes, here comes a longer question. What are the biggest risks with your existence today? In your company contract, how does the yield look on the contract set for 2021? And how do you see the risks that this contract will not be renewed? Can you explain clearly how you did business during 2020-2021 and how you do business today? Are there any differences in the extended duration and so on?

It was a long question, I'll try to take it short. We do not make any major difference in how we calculate, and the only thing we calculate is with a high yield today. On the other hand, when we did business in 2021, the yield was lower, but the costs were also lower to build. We have written quite long articles on the new projects we have done, but we see that we are doing well in the rental value, or rental per square meter price on that type of property. We see that we are lower than what it will be today. So we are positive about the existing rental value we are at.

Thank you. Will you see an increase in the management result during 2024 without any rental cuts?

You can take it, Justine.

Yes, I will just start with making little predictions. We do not make any forecasts, but just as you can read in the report, Niklas said that we have 27 million in turnover to come in running during the year with new innovations. We are in the middle of the year when we make a lot of profit, and many of them are tripping. So yes, we are adapted to today's rental level, and we expect that the report will fill in in the future.

Thank you. You mentioned a expected increase in the rental market in the future. What strategies have you planned to handle this uncertainty and continue to create growth?

We are working on the rental and will probably strengthen it further, as it will be a bit more difficult in the future. We are working on the rental market and our tenants all the time to be ahead of their revenue and work. I think it is our good luck that we have such a high rental rate. We work with the tenants. We try to be ahead of them all the time.

I understand. You now have a net profit of 45%. Is that where you want to be?

We have come up with new strategies for a while now, and we can imagine going up to 55% in view. Then we should be sure that we do good business and we should not take any big risks with rentals and things. We are looking at a situation where the rent is tied to the bottom of the rent. We will be a bit higher than 45%, but then we will do good business.

Thank you. How do you see yourself starting new projects now that the economy is more stable and the construction costs have gone up? How do you see yourself starting new projects?

We like to start new projects in the commercial side, especially in the industrial area where we have several questions. In the housing side, we do not start any projects because the business does not go together right now. But in the commercial side, we see that it has come back a bit on the construction side. The builders and builders are interested in jobs and the price is going down. We see that the price is going down, but we see that we get the calculations pretty good. -15% project profit if we start something.

Thank you. How do you work actively with the cost of energy?

We have built up an energy department here and will strengthen it further, four people. We have a lot of hard work and we have seen with banks that you can find good credit to do the energy handling in the house and savings. We work a lot with that.

Great. Finally, the last question. What do you as an investor have to keep in mind for the coming quarter when it is in the Vika?

A response to the vaccine?

Yes, it was not an easy question. It is the case with many other real estate companies. We are curious about how the rent develops. The rent gets a big impact in our result. As well as what is happening on the transaction market and in the energy levels. It feels like the value has been at the top and that the energy is slowly going down.

I feel it in our area. We have a lot of questions about selling commercially. My feeling when it comes to the industry, the energy is on the way down in our area. We have a lot of questions about selling. We want to build clusters and have a good management.

Thank you for your time. I would like to thank everyone who has watched and have a good week.

Thank you all.