Baltic Horizon Fund (NHCBHFFT) Q4 2024 earnings summary

Executive summary

• Strategic focus on increasing occupancy to over 95% by June 2025, reducing LTV below 50%, and achieving full ESG certification across the portfolio, with a strong presence in Latvia, Lithuania, and Estonia.

• Ambitious occupancy goal set at 95% by June 2025, with current actual occupancy at 82.1% and probable occupancy at 88.5% based on signed leases.

• Net operating income (NOI) target of €18 million by 2027, contingent on attracting new tenants and making investments.

• Management is executing a disposal strategy to reduce LTV below 50%, with several asset sales in progress and a focus on paying down expensive bonds.

• All assets are BREEAM certified; GRESB rating at 3 stars (80 points), with an action plan to regain 4 stars in 2025.

Financial highlights

• Net rental income for 2024 was EUR 11.6m (down from EUR 14.6m in 2023); Q4 2024 net rental income was EUR 2.7m, down 6% year-over-year.

• Net loss for 2024 was EUR 16.8m, improved from EUR 23.0m loss in 2023, mainly due to lower property valuation losses.

• Portfolio fair value decreased by 3.7% to EUR 241.2m, mainly due to valuation losses in Galerija Centrs and S27.

• LTV increased to 61.8% at year-end 2024, up from 57.3% a year earlier; average cost of debt rose to 6.7%.

• NAV at year-end 2024 was EUR 98.1m, compared to EUR 109.5m at the end of 2023.

Outlook and guidance

• Targeting occupancy above 95% and monthly NOI of EUR 1.4–1.5 million by June 2025, contingent on tenant fitouts and no asset disposals.

• Plans to achieve a DSCR of at least 1.2 through disposals and NOI growth, and to redeem EUR 22 million in bonds during 2025.

• Up to three assets identified for sale; proceeds to be used for debt reduction and portfolio optimization.

• Continued investment in ESG, aiming for a 4-star GRESB rating and full BREEAM/LEED certification; all Latvian and Lithuanian properties to use solar energy from Q1 2025.

• Dividend payments in 2025 remain a goal, contingent on continued positive developments.