SBB Norden (SBB) Q2 2024 earnings summary

Executive summary

• Like-for-like rental income grew 7.2% and net operating income rose 8.9% year-over-year in Q2 2024, despite overall declines from divestments.

• Debt was reduced by SEK 7.8bn in the period and SEK 43bn over the last two years, supporting financial stability.

• Property values decreased by 1.4% in Q2, but the decline is leveling off.

• Strategic restructuring included joint ventures, asset sales, and capital measures to strengthen liquidity and reduce debt.

• Net profit for the period was SEK -3,429m, a significant improvement from SEK -13,796m last year.

Financial highlights

• Net operating income for Jan–Jun 2024 was SEK 1,455m, down from SEK 1,568m due to divestments, but like-for-like NOI grew 8.9%.

• Rental income for Jan–Jun 2024 was SEK 2,121m, down from SEK 2,317m, but up 7.2% like-for-like.

• Loan-to-value ratio at 54% in Q2 2024; interest coverage ratio at 2.0x.

• Average interest rate at 2.10%; average debt maturity 3.8 years.

• EPRA NRV per share: SEK 10.07 (down from SEK 18.99).

Outlook and guidance

• Management expects rent increases to outpace inflation in 2025 and sees improving market conditions.

• Central costs from reorganization and legal processes are expected to halve by end of 2025.

• Sveafastigheter is prepared for an IPO or strategic partnership to enhance funding and reduce debt.

• No additional dividends planned for the foreseeable future; focus remains on debt reduction and cautious investment.