SBB Norden (SBB) Q4 2024 earnings summary

Executive summary

• Like-for-like rental income increased by 5.5% and net operating income grew by 7.1% year-over-year, reflecting operational improvements despite overall declines from asset sales.

• Debt reduced by SEK 32.7 billion over 24 months, with a continued focus on financial stability and liquidity.

• Group restructured into three main business areas: community, residential, and educational properties, with Sveafastigheter listed and Nordiqus established as key subsidiaries.

• Loss before tax improved to SEK -7,174m from SEK -20,722m, with a net loss for the period of SEK 6.2bn.

• Disputes with bondholders and hedge funds resolved; no ongoing litigation or acceleration claims.

Financial highlights

• Rental income for 2024 was SEK 3,708m, down from SEK 4,581m, but up 5.5% in comparable portfolios year-over-year; NOI was SEK 2,572m, down from SEK 3,209m, but up 7.1% like-for-like.

• Q4 2024 profit for the period was -SEK 878m, a significant improvement from -SEK 3,314m in Q4 2023.

• Loan-to-value ratio at 61% in Q4 2024; interest coverage ratio at 2.0x; average interest rate 2.43%.

• Rental occupancy rate was 91.5%–92% at Q4 2024.

• EPRA NRV per share was SEK 8.66, down from SEK 12.81; EPRA NTA per share was SEK 7.64, down from SEK 11.07.

Outlook and guidance

• Management expects 2024 to be the last year of negative property value trends, with stabilization and potential value growth in 2025.

• Further asset sales of approximately SEK 10bn in non-strategic assets planned to improve liquidity and reduce debt.

• Focus on reducing central costs by 50% by end of 2025 and continued debt reduction, with no additional dividend and limited new acquisitions.

• Residential segment expected to deliver high rental and NOI growth, while community sector rental growth may slow due to lower indexation.