Castellum (CAST) Q2 2024 earnings summary

Executive summary

• Income from property management increased 16.3% year-over-year to SEK 2,435 M, supported by cost reductions, portfolio streamlining, and prior rights issue.

• Total income rose to SEK 4,977 M, with net operating income up 5.2% to SEK 3,391 M and like-for-like rental income up 2.6%.

• Net leasing turned positive at SEK 6 M, and economic occupancy rate remained stable at 91.3%.

• Portfolio valued at SEK 156 billion, with over 75% in Nordic metropolitan areas and strong exposure to public sector tenants.

• Sustainability efforts recognized globally, with 64% of property value sustainability certified and energy efficiency improved.

Financial highlights

• Direct property costs decreased by 8%, mainly due to lower electricity costs; central admin expenses fell 36.3% to SEK 128 M.

• Net financial items improved by 10.1% due to lower loan volume.

• Net investments were SEK -474 M, with SEK 1,550 M in property sales exceeding acquisitions and project investments.

• Property values written down by SEK 1.6 billion (-1.1%) during the period.

• Cash flow from operating activities for the half-year was SEK 1,862 M.

Outlook and guidance

• Management expresses growing optimism in both financing and tenant demand, with more active business dialogues and attention turning to new investments.

• Expectation to become net investors, focusing on new projects and selective acquisitions, while continuing portfolio trimming.

• Downward trend in property values appears to have stabilized, with management believing the market is bottoming out.

• Regional cities and the office segment remain stable, with a strong balance sheet supporting future growth.

• Ongoing cost reductions and a strong financial position support future value creation.