Wallenstam (WALL) Q3 2024 earnings summary

Executive summary

• Rental income for Jan–Sep 2024 rose to SEK 2,187 million, up 7% year-over-year, with net operating income increasing by 11% to SEK 1,686 million.

• Income from property management for Jan–Sep 2024 was SEK 880 million, up from SEK 828 million year-over-year.

• Construction activity resumed, with 1,379 apartments under construction and 169 new apartments started in Nacka and Mölndal during Q3.

• Entered the commercial segment in Stockholm CBD with the acquisition of the fifth Hötorgsskrapan for SEK 2.8 billion, with possession in January 2025.

• Profit after tax for Jan–Sep 2024 was SEK 139 million, compared to SEK 134 million in the same period last year.

Financial highlights

• Surplus ratio for Jan–Sep 2024 was 77.1%; Q3 surplus ratio was 79.0%.

• Profit before tax for Jan–Sep 2024 was SEK 278 million, up from SEK 95 million year-over-year.

• Operating expenses decreased by 3% (SEK 17 million), mainly due to a 40% drop in electricity prices.

• Financial net increased by 24% year-over-year, but the pace of increase is slowing as interest rates decline.

• Net asset value per share was SEK 56.40 as of Sep 30, 2024.

Outlook and guidance

• 1,379 apartments are under construction, with major completions expected in 2024–2027.

• Rent increases for 2025 have been agreed and are on par with 2024, supporting stable income growth.

• Residential rent growth secured at 4.5% for this year and similar growth expected next year due to a two-year agreement.

• Residential and commercial demand remains stable, with a 90% tenant retention rate and full occupancy in residential holdings.

• The business plan 2030 targets a net asset value of SEK 100 per share, with a minimum equity/assets ratio of 35%.