Diös Fastigheter (DIOS) Q3 2024 earnings summary

Executive summary

• Income remained flat in Q3 2024 compared to Q3 2023, with asset divestments offsetting like-for-like growth, while property management income rose 17% to SEK 258m and net letting was SEK 8m, reflecting a shift toward growth and profitability.

• Economic occupancy at 91% at end of Q3 2024, down 1ppt year-over-year due to divestments.

• Portfolio rotation and a SEK 940m acquisition in Luleå and Gävle signal renewed growth focus.

• CEO Knut Rost will step down at year-end, succeeded by David Carlsson, after overseeing significant company growth since 2014.

Financial highlights

• Q3 2024 income was SEK 622m (621), operating surplus SEK 462m (449), and property management income SEK 258m (221).

• Like-for-like rental growth reached 6.5%, driven by indexation and rent reversion.

• Surplus ratio improved to 75% in Q3 2024 from 73% in Q3 2023.

• Profit after tax for Q3 was SEK -11m (88), mainly due to negative derivative revaluations; EPS was SEK -0.08 (0.62).

• Loan-to-value ratio improved to 52.6% (54.4), equity ratio at 36.4% (34.6), and interest coverage at 2.4x (2.1).

Outlook and guidance

• Management expects continued financial improvement, supported by lower interest rates, strong leasing, and robust market fundamentals in northern Sweden.

• The company targets an average return on equity of at least 12% over five years and a 50% reduction in CO2 emissions by 2030.

• Rental growth potential supported by rent reversion and indexation; centrally located assets expected to drive higher rents and limit vacancy risk.

• Market outlook supported by significant green industry investments and job creation in the region.

• Short-term challenges expected in 2025 due to lease terminations and higher utility costs, but long-term outlook remains positive.