Bonava (BONAV) DNB Carnegie Micro Cap Day Conference summary

Strategic overview and recent developments

• Operations span six countries and 22 city locations, focusing on becoming a top-three local player for sustainable profit and value generation.

• Recent years involved exiting Denmark and Russia, divesting Norwegian and St. Petersburg businesses, and reducing costs by SEK 1.1 billion, cutting staff from over 2,000 to 900.

• Refinancing completed, normalizing financing terms and improving liquidity, enabling future dividend payments.

• Land bank consists of 24,400 building rights, with an average sales price of SEK 4 million per unit.

• Focus on both direct-to-consumer and investor sales, with flexible home structures to address demographic shifts.

Market conditions and operational focus

• Germany remains the main profit engine, accounting for up to 75% of sales during tough years, but Sweden is now the fastest-growing market.

• Swedish market recovery is ahead of expectations, especially in Stockholm, Gothenburg, and Uppsala.

• Finland remains challenging due to unemployment and economic uncertainty, with only selective projects being started.

• Baltic markets are profitable but lack scale; focus remains on major cities like Riga, Vilnius, and Tallinn.

• Controlled growth strategy means starting projects only when local market conditions are favorable, maintaining high sales rates and low unsold inventory.

Financial targets and growth outlook

• Targeting 3,500–4,000 annual starts to achieve scale and overhead efficiency, expecting to reach this by year-end or early next year.

• Project margins above 17% are prioritized, with land bank value and equity ratios closely monitored.

• Financial targets include SEK 15–16 billion turnover, SEK 1.5–1.6 billion EBIT, above 10% EBIT margin, 15% ROE, and 40% dividend payout ratio.

• Positive cash flow expected from Q2 2027 as working capital needs subside and project financing stabilizes.

• Recent refinancing is expected to lower interest costs by SEK 100 million annually, boosting profitability.