Fabege (FABG) Q2 2024 earnings summary

Executive summary

• Rental income for Jan–Jun 2024 increased to SEK 1,731m from SEK 1,685m, with like-for-like rental growth of 8%.

• Gross profit remained stable at SEK 1,264m–1,269m, while operating surplus rose to SEK 1,269m.

• Net profit after tax improved to -SEK 682m from -SEK 2,535m, despite higher interest costs and negative value changes.

• Property value write-downs were SEK -1,461m, less severe than last year's SEK -3,824m.

• Net leasing was negative at -SEK 74m, with economic occupancy rate declining to 90% from 91%.

Financial highlights

• Earnings per share were -2.17 SEK, an improvement from -8.06 SEK year-over-year.

• Surplus ratio/operating margin was 73% (previous year: 74%).

• Total property return was -0.2% for H1 2024, compared to -3.0% last year.

• Profit from property management was SEK 659m (703).

• Result before tax: SEK -769m (-3,222).

Outlook and guidance

• 2024 net leasing target set at over SEK 80m, with H1 performance at -SEK 74m.

• Management expects stable rental levels in Stockholm but notes longer decision processes and subdued market activity.

• Riksbank and ECB rate cuts are expected to support the market, with further reductions possible in H2 2024.

• Several residential project starts postponed, but planning continues.

• The company aims to end 2024 with positive net letting.