Corem Property Group (CORE) Q2 2024 earnings summary

Executive summary

• Positive net letting and focus on maintaining a strong long-term balance sheet in H1 2024.

• Income for January–June 2024 was SEK 1,882 million, down from SEK 2,221 million year-over-year, mainly due to property divestments, while net letting remained positive at SEK 87 million.

• Profit from property management was SEK 517 million for H1 2024, and net profit for the period turned positive at SEK 6 million after two years of losses.

• 33 properties were divested or agreed for divestment in H1 2024, totaling SEK 2.7 billion in value, including the entire Jönköping portfolio.

• Strategic divestments and reduced investments to strengthen financial position.

Financial highlights

• Income for January–June 2024: SEK 1,882 million; lettable area: 2,317,000 sq.m.

• Profit from property management: SEK 517 million for H1 2024.

• NAV per ordinary share (A/B): SEK 17.28; LTV: 55%; average interest rate: 4.7%.

• Economic occupancy rate: 86% (89%).

• Operating surplus for H1 2024 was SEK 1,223 million, with an operating margin of 65%.

Outlook and guidance

• Continued focus on strengthening the balance sheet and long-term sustainable financing.

• Optimizing property management, improving occupancy and operating margin.

• Selective approach to new projects, prioritizing new lettings.

• Management expects continued divestments and operational optimization, with a more stable market and improved capital market liquidity.

• Some new lettings will impact occupancy and margins in 2025 and 2026.