Fastighets Balder (BALD) investor relations material

Executive summary

• Q3 rental income reached SEK 3,642m, up 6% YoY; net operating income was SEK 2,836m, also up 6%.

• Portfolio value was SEK 246.1bn, occupancy 95%, average lease duration 13.2 years, and NAV SEK 97.03 per share.

• Net debt/total assets was 50.2%; available liquidity was SEK 24.9bn and S&P rating was BBB with stable outlook.

• Jan–Sep rental income rose 4% to SEK 10,671m; property-management profit per share fell 8% reported, but increased 6% excluding Norion Bank participation.

Financial highlights

• Q3 profit from property management was SEK 1,562m, down 5% YoY; excluding the Norion dividend effect in comparative figures, profit per share increased 11%.

• Q3 like-for-like rental growth was 1.2%; the surplus ratio held at 78%.

• Jan–Sep profit after tax attributable to parent shareholders was SEK 4,501m versus SEK 5,851m; profit from property management was SEK 4,695m versus SEK 5,176m.

• Jan–Sep profit before tax was SEK 6,060m versus SEK 7,319m; unrealised property-value gains were SEK 1,262m versus SEK 2,159m.

Outlook and guidance

• Current 12-month earning capacity implied rental income of SEK 14.7bn, net operating income of SEK 11.2bn and property-management profit of SEK 5.27 per share; it is not a forecast.

• Net debt/EBITDA target remains below 11x; management expects gradual improvement mainly through EBITDA growth, with operational improvements, like-for-like growth and potential asset rotation contributing.

• Balanced capital allocation is planned until rolling 12-month net debt/EBITDA reaches 11x; near-term project development investment is to remain limited.

• Operating practices are under review to reduce costs and vacancy; central administration costs are expected to fall in absolute terms, with no quantified plan finalized.

• Net acquisitions beyond small bolt-ons are considered unlikely as buybacks offer better relative returns; Finnish residential demand may benefit from economic and labor-market recovery and low construction.