Kojamo Oyj

Quarterly Report • Feb 15, 2024

15 February 2024 Jani Nieminen, CEO Erik Hjelt, CFO

Financial Statements Release 2023

Kojamo plc

• Financial development
• Outlook and financial targets

Summary of January– December 2023

Kojamo plc`s Financial Statements Release 2023 3

Total revenue and FFO increased in 2023 in a challenging operating environment

• Total revenue, net rental income and FFO increased
• Occupancy rate improved and tenant turnover decreased
• The yield requirements for the valuation of the investment properties were increased by 0.43 percentage points, of which the fourth quarter accounted for 0.37 percentage points. The increase in net rental income and changes in other parameters significantly mitigated the impact of the increase on the fair value
• Balance sheet has remained strong and financing figures good
• Saving programme is proceeding according to plans
• After the review period, we issued a new EUR 200 million green bond as a private placement

Operating environment

General operating environment

• The outlook for the global economy is uncertain; high interest rates, weak consumer confidence as well as geopolitical tensions cast a shadow over the outlook
• Inflation has slowed down quickly, and employment has remained high
• The Finnish economy contracted slightly in 2023, but it is expected to turn to a small growth in 2024
• The fall in interest rates and the slowdown in inflation will increase consumers' purchasing power as well as investments. Employment is estimated to decrease temporarily, but it will remain at a high level
• The rate hike cycle is estimated to be over, and the market expects interest rate cuts to start in the first half of 2024

Industry key figures	2024E	2023E
Residential start-ups, units	<19,500	<16,000
of which non-subsidised block-of-flats	5,000	3,800
Building permits granted, annual, units *	n/a	20,992
Construction costs, change, % **	n/a	1.1
GDP growth, %	0.7	-0.5
Unemployment, %	7.5	7.2
Inflation, %	2.0	6.3

5

*2023E Rolling 12 months, November 2023; ** 2023E: building cost index, December 2023 Sources: Ministry of Finance, Economic Survey, 12/2023; CFCI's economic survey, September 2023; Statistics Finland, Building and dwelling production; Statistics Finland, Building cost index;

Construction companies' interim reports

Kojamo plc`s Financial Statements Release 2023

Operating environment

Kojamo plc`s Financial Statements Release 2023

The situation in the rental market has improved

• Urbanisation, decreasing average household size and demand focusing on central locations support the demand for rental apartments in the long term
• The population growth of the capital region, Tampere and Turku accelerated during 2023. Increased immigration advances urbanisation
• Economic uncertainty, risen interest rates of mortgages, increasing property charges and a significant decrease in housing production are expected to increase the demand for rental apartments

Population growth forecast 2022–2040, %

6

* Helsinki, Espoo, Kauniainen, Vantaa ** Capital region, Hyvinkää, Järvenpää, Kerava, Kirkkonummi, Mäntsälä, Nurmijärvi, Pornainen, Porvoo, Riihimäki, Sipoo, Tuusula, Vihti Sources: Nordea's Housing Market Review September 2023; MDI, Population forecast 2040, September 2023; Statistics Finland, Dwellings and housing conditions 2022;

Operating environment

Housing production and demand

• The housing start-ups declined to a historically low level last year, and they are estimated to remain almost as low this year as well
• The strong contraction in residential construction is due to weak demand and high plot and construction prices
• Construction may be at a standstill for a longer period of time, which reduces the housing supply

Sources: CFCI's economic survey, September 2023; Construction companies' interim reports; Housing production need: VTT, Need for housing 2020-2040;

Kojamo plc`s Financial Statements Release 2023 7

Housing production need 2020–2040, %

Residential start-ups in Finland 2013–2023E

Ongoing development projects

Kojamo's projects on map

• 354 apartments** under construction in the Helsinki region
• Costs of completing these is EUR 10.0 million
• Owned plots enable starts of about 2,300 apartments
• For the time being, we will not make new investment decisions due to the uncertainty in the market

Estimate of completions, units

** Does not include binding preliminary agreements of 119 apartments

Housing stock and customer distribution

• Kojamo's housing stock meets the demand nicely
• All age groups are well represented among the tenants

Key figures of sustainability 1–12/2023

business growth

SUSTAINABILITY PROGRAMME

Kojamo plc`s Financial Statements Release 2023

11

reporting

Total revenue and net rental income increased

• Total revenue increased due to the growth of property portfolio as well as due to the development of rents and the financial occupancy rate
• Net rental income increased due to higher total revenue and lower repair costs but was weakened by higher property maintenance costs

Kojamo plc`s Financial Statements Release 2023

Profit before taxes and FFO

• FFO grew compared to previous year. The increase in FFO was especially attributable to the improvement in net rental income and the profit from the repurchase of bonds

The comparison figures for 2020 have been adjusted to reflect the current calculation method

+4.1%

14

Kojamo plc`s Financial Statements Release 2023

Financial occupancy rate improved

• Financial occupancy rate was 93.0 (92.0) per cent during the financial year
• Occupancy rate increased to 94.0 (93.0) per cent during the last quarter
• Tenant turnover decreased compared to the previous year

Tenant turnover, %

excluding internal turnover

15

Tenant turnover = (terminated rental agreements under the period / number of apartments) * 100

Kojamo plc`s Financial Statements Release 2023

Financial occupancy rate, %

Development of Like-for-Like rental income

The past 12 months compared to the previous 12-month period

Development of Like-for-Like rental income as at 31 December 2023

Investments

• We will not make new investments nor will we launch new modernisation projects for the time being
• Ongoing projects will be completed as agreed
• We will focus repairs to support renting of apartments

Gross investments and sales of investment properties, M€

Modernisation investments and repairs, M€

Gross investments Sales of investment properties

Kojamo plc`s Financial Statements Release 2023

17

The value of investment properties was EUR 8.0 billion

• The net result from the fair valuation of investment properties in 2023 was EUR -295.4 million, of which the fourth quarter accounted for EUR -158.7 million
• Yield requirements were increased by 0.43 percentage points, of which the fourth quarter accounted for 0.37 percentage points. The impact of the change in yield requirements was EUR -815.5 million
• The impact of increase in net rental income was EUR 305.9 million
• The inflation assumption was increased by 0.2 percentage points, rent growth assumption by 0.4 percentage points and expense growth assumption by 0.2 percentage points. The impact of these was EUR 181.7 million

Changes in fair value

M€	1–12/2023	10–12/2023
Change in yield requirement	-815.5	-661.3
Change in net rental income	305.9	330.8
Change in inflation, rents and expense growth assumptions	181.7	181.7
Other	32.5	-9.8
Profit/loss on fair value of investment properties	-295.4	-158.7

Fair value of investment properties, M€ *

-1.4 %

18

Kojamo plc`s Financial Statements Release 2023

* Investment properties include completed apartments, development projects and land areas as well as investment properties held for sale

Equity ratio and Loan to Value (LTV) at a strong level

• Equity ratio and Loan to Value (LTV) remained strong
• Moody's affirmed Baa2 rating in December. There's a significant buffer to LTV limit of 50 per cent

Equity ratio, %

Loan to Value (LTV), %

2024 maturing loans are covered

• The EUR 425 million syndicated loan made in the autumn was undrawn at the end of the year
• After the review period, we issued a new EUR 200 million bond which will be used for refinancing of loans maturing in 2025

The Group's liquidity, M€ Financing key figures

275

15 3

425

Cash and cash equivalents 15 M€ Financial assets 3 M€ Unused committed credit facilities 275 M€ Unused syndicated loan 425 M€

	31 Dec 2023
Interest-bearing liabilities, M€	3,600.4
Hedging ratio, % ¹⁾	93
Average interest rate, % ²⁾	2.4
Coverage ratio	3.6
Average loan maturity, years	2.8
Average interest rate fixing period, years	2.9

¹⁾ Bond maturing in 06/2024 is included in fixed rate loans

²⁾ Includes interest rate derivatives

Distribution of the Group's loan maturities, M€

Syndicated loan maturity 2028 assumes that two one-year extension options will be used

20

Key figures per share

• Key figures per share was especially impacted by the fair value decrease of the investment properties

Outlook and financial targets

Kojamo plc`s Financial Statements Release 2023 22

Outlook for Kojamo in 2024

Kojamo estimates that in 2024, the Group's total revenue will increase by 4–8 per cent year-on-year. In addition, Kojamo estimates that the Group's FFO for 2024 will amount to between EUR 154–166 million, excluding non-recurring costs.

The outlook is based on the management's assessment of total revenue, property maintenance costs and repairs, administrative expenses, financial expenses, taxes to be paid and new development to be completed, as well as the management's view on future developments in the operating environment.

The outlook takes into account the estimated occupancy rate and rises in rents as well as the number of apartments to be completed. The outlook does not take into account the impact of potential acquisitions or disposals on total revenue and FFO.

The management can influence total revenue and FFO through the company's business operations. In contrast, the management has no influence over market trends, the regulatory environment or the competitive landscape.

Kojamo plc`s Financial Statements Release 2023 23

Key figure	Actual 2023	Actual 2022	Actual 2021	Actual 2020	Target
Annual growth of total revenue, %	7.0	5.5	2.0	2.3	4–5
Annual investments, M€	190.7	501.6	356.9	371.2	200–400
FFO/total revenue, %	37.8	38.9	39.1	39.5	> 36
Loan to Value (LTV), %	44.6	43.7	37.7	41.4	< 50
Equity ratio, %	44.5	45.3	49.0	45.6	> 40
Net Promoter Score (NPS)*	50	45	20	36	40

* The calculation method has changed for example including digital services in calculation. Actual for 2021 and 2020 have not been adjusted to reflect the current calculation method.

Total revenue, net rental income and FFO increased

Summary

Balance sheet and financial key figures have remained strong

Saving programme is proceeding as planned Occupancy rate improved from previous year

Population grows in cities, and the supply of new apartments will decrease significantly

Thank you!

Contact details:

CEO Jani Nieminen, tel. +358 20 508 3201

CFO Erik Hjelt, tel. +358 20 508 3225

Director, Treasury & Investor Relations Niina Saarto, tel. +358 20 508 3283

www.kojamo.fi

Interim Report January-March 2024 to be published on 8 May 2024

Kojamo plc`s Financial Statements Release 2023 27

Saving programme

• We launched a saving programme in August which aims to achieve total savings of EUR 43 million in costs and investments in 2024, of which the share of costs is estimated to be EUR 18 million
• The change negotiations started as part of the saving programme were concluded. As a result, 59 employees will be laid off until further notice or for a fixed term, and five person's duties will end permanently. Additionally, the number of personnel has decreased by almost 30 positions due to resignations and retirements as well as due to unfulfilled positions
• In accordance with the saving programme, we will not make new investment decisions nor will we launch new modernization projects
• We will reduce repairs other than those supporting the renting of apartments, as long as a repair debt is not incurred
• Moderate property sales may be carried out within the next 12 months
• All of the above measures are aimed at maintaining the company's profitability and credit rating
• Additionally, to strengthen the company's financial position, the company's Board of Directors proposes to the spring 2024 Annual General Meeting that no dividend be paid for 2023

Immigration and its impact

• In addition to migration within the country, immigration that has increased in the 2020s will advance urbanisation.
• Immigration is heavily focused on the capital region and other large cities

Sources: Statistics Finland, population statistics; MDI, Population forecast 2040, September 2023

Kojamo's apartment portfolio

Region	Number of apart ments, units	Number of commercial premises and other leased premises, units	Fair value, (EUR million)	Fair value, (EUR thousand / unit)	Fair value, (EUR / sqm)	Financial occupancy rate, %3)	Share of revenue, %
Helsinki region	25,332	476	5,711	221	4,135	91.9	67
Tampere region	3,949	111	671	165	3,234	96.4	9
Turku region	2,122	25	335	156	2,935	95.8	5
Others	9,216	145	1,018	109	2,063	94.7	19
Total	40,619	757	7,7351)	187	3,523	93.0	100
Others			3042)
Total portfolio	40,619	757	8,039			93.0	100

Apartment distribution, %

through shares

2) Fair value of ongoing projects under construction, plots owned by the company and ownership of certain assets through shares and IFRS 16 right-of-use assets 3) Financial occupancy rate does not include commercial premises and other leased premises

Kojamo plc`s Financial Statements Release 2023 30 1) The figures reflect income-generating portfolio assets, which excludes new projects under construction, plots owned by the company and ownership of certain assets

354 apartments under construction

• During the review period, 0 (985) apartments were acquired, 73 (0) sold and 1,450 (1,348) completed
• During the period, construction of 0 (477) apartments was started

+3.5%

Development of apartment portfolio, units

Apartments under construction, units

-80.4%

Strategic focal points

Renewal through digital solutions The most competent personnel and a dynamic place to work Responsibility and sustainable development Strong growth Operational excellence Delivering the best customer experience We offer easy and effortless services for our customers and create added value through services We seek profitable growth with multi-channel approach and optimised financing structure We create competitiveness and profitability through industryleading operating models Responsibility is a part of our DNA and plays important role in the work of everyone at Kojamo We improve our business and create added value to our customers by taking advantage of solutions enabled by digitalisation We are known for dynamic and effective corporate culture. We ensure our future competitiveness through competence development and employee experience

Sustainability programme guides our systematic sustainability work

STRATEGIC FOCAL POINT: RESPONSIBILITY AND SUSTAINABLE DEVELOPMENT

We create better urban housing

Our sustainability work is proceeding

• We took big steps towards the achievement of the 2030 carbon neutrality goal of our responsibility program by concluding a demand flexibility agreement with Vantaan Energia to optimize our energy use; we get district heating produced with renewable energy sources to almost 70 locations in Vantaa. This reduced the total emissions of Kojamo's real estate stock by up to 20 percent.
• In the customer interface, we have celebrated the theme year of recycling and sorting and encouraged residents to sort more efficiently by, among other things, offering new instructions and communication content and distributing bio waste bags to residents.
• We got the best result ever, 78 points out of 100, when we participated for the fourth time in real estate sector's international GRESB sustainability assesment. With our result, we again earned the Green Star recognition and three out of five stars.

We are commited to complying with the UN Sustainable Development Goals

Our target is carbon-neutral energy use in our properties by 2030

Kojamo plc`s Financial Statements Release 2023 1) Consists of new development projects involving Kojamo's own plot reserve.

2) Consists of new development projects involving Kojamo's own plot reserve where planning has started 2021 or later.

Sustainability is visible in our every day life

Sustainable cities

We are committed to the UN Sustainable Development Goals (SDGs) and carbon-neutral energy use in our property portfolio by 2030

100% of properties use carbonneutral property electricity

77.0% apartments' indoor temperature controlled by optimization solution

100% of Kojamo's offices are WWF Green Office certified

-4.9 heating index (kWh/m³ )

0.8 (-17%) carbon footprint (t CO2e/ apartment)

33 % waste recycling rate

our goal to improve energy consumption during 2017–2025 -7.5% of which we have achieved 98%*

The most competent personnel and a dynamic place to work

100% Coverage of performance appraisals of personnel

60 / 40% Gender ratio (W/M)

96 occupational safety index at our construction sites

The best customer experience

50 Net Promoter Score NPS

Shared cars available for all our residents

A responsible corporate citizen

Our anti-grey economy procedures exceed legislative requirements

4,513 indirect employment effect (person years)

85 tax footprint, EUR million

4 data protection violations or supspected misconducts

50 grants for children families living in Lumo homes to support sports activities of young people

All figures represent the situation at the end 2023 * = In line with VAETS II programme, at the end of 2023, estimate Kojamo plc`s Financial Statements Release 2023 37

Sustainability commitments and reporting

Our sustainability commitments

Our target is carbonneutral energy use in our properties by 2030

We are committed to complying with the UN Sustainable Development Goals

We are committed to improve our energy efficiency by 7.5% during 2017–2025

Our sustainability reporting and recognitions

78/100

We report on our sustainability work with reference to GRI Standards

We participated in the global GRESB sustainability

We apply EPRA's Best Practice Recommendations in our

assessment

reporting

Our memberships

We are a member of FIBS, the largest corporate responsibility network in the Nordic countries, accelerating sustainable and responsible business.

Kojamo plc`s Financial Statements Release 2023 38

Dividend policy

Kojamo's objective is to be a stable dividend payer whose annual dividend payment will be at least 60 per cent of FFO, provided that the Group's equity ratio is 40 per cent or more and taking account of the company's financial position.

To strengthen the company's financial position, the company's Board of Directors proposes to the spring 2024 Annual General Meeting that no dividend be paid for 2023.

Dividend history

* Board's proposal for the Annual General Meeting

Kojamo's ten largest shareholders (as at 31 December 2023)

	Shareholder	Number of shares	% of shares
	Nominee-registered shareholders	81,172,598	33.7
1.	Heimstaden Bostad AB	49,389,283	20.0
2.	Ilmarinen Mutual Pension Insurance Company	20,537,814	8.3
3.	Varma Mutual Pension Insurance Company	19,362,375	7.8
4.	The Finnish Industrial Union	16,067,182	6.5
5.	Trade Union of Education in Finland	11,814,417	4.8
6.	Finnish Construction Trade Union	5,708,609	2.3
7.	Trade Union PRO	4,904,150	2.0
8.	Elo Mutual Pension Insurance Company	3,627,000	1.5
9.	OP-Finland Fund	2,231,091	0.9
10.	Service Union United PAM	2,200,000	0.9
	Other shareholders	30,129,880	12.2
Total		247,144,399	100.0

Development of the number of the shareholders

Share of nominee-registered and direct foreign ownership, %

Source: Euroclear Finland

	10–12/2023	10–12/2022	Change, %	1–12/2023	1–12/2022	Change, %
Total revenue, M€	113.5	107.9	5.2	442.2	413.3	7.0
Net rental income, M€	75.5	72.4	4.3	297.2	280.1	6.1
Net rental income margin, %	66.5	67.1		67.2	67.8
Profit/loss before taxes, M€	-119.5	-748.3	84.0	-112.3	-499.8	77.5
Gross investments, M€	29.5	85.1	-65.4	190.7	501.6	-62.0
Funds From Operations (FFO), M€	38.3	40.7	-6.0	167.2	160.7	4.1
FFO per share, €	0.15	0.16	-6.3	0.68	0.65	4.6
Financial occupancy rate, %				93.0	92.0
Fair value of investment properties, Bn€				8.0	8.2	-1.4
Number of apartments				40,619	39,231
Number of apartments under construction				354	1,804
EPRA NRV per share, €				18.45	19.53	-5.5
Equity ratio, %				44.5	45.3
Loan to Value (LTV), %				44.6	43.7

Consolidated income statement

M€	10–12/2023	10–12/2022	1–12/2023	1–12/2022
Total revenue	113.5	107.9	442.2	413.3
Maintenance expenses	-30.0	-26.8	-115.7	-103.1
Repair expenses	-8.0	-8.6	-29.3	-30.2
Net rental income	75.5	72.4	297.2	280.1
Administrative expenses	-13.2	-13.4	-45.6	-43.1
Other operating income and expenses	1.1	1.5	3.7	3.5
Profit/loss on sales of investment properties	0.3	-	0.2	0.2
Profit/loss on sales of trading properties	-	0.0	-	0.0
Profit/loss on fair value of investment properties	-158.7	-792.8	-295.4	-682.0
Depreciation, amortisation and impairment losses	-0.3	-0.3	-1.3	-1.2
Operating profit/loss	-95.2	-732.6	-41.1	-442.5
Total amount of financial income and expenses	-24.4	-15.9	-71.3	-57.4
Share of result from associated companies	0.1	0.1	0.1	0.1
Profit/loss before taxes	-119.5	-748.3	-112.3	-499.8
Current tax expense	-1.6	-2.8	-16.5	-17.3
Change in deferred taxes	26.4	152.4	39.8	117.2
Profit/loss for the period	-94.7	-598.8	-89.0	-399.8

Balance sheet

M€	31 Dec 2023	31 Dec 2022
Non -current assets
Intangible assets	0.6	0.7
Investment properties	8,038.8	8,150.2
Property, plant and equipment	28.0	28.4
Investments in associated companies	2.0	1.5
Financial assets	0.8	0.7
Non -current receivables	6.5	6.7
Derivatives	29.8	53.8
Deferred tax assets	4.9	1.5
Total non -current assets	8,111.4	8,243.4
Current assets
Trading properties	-	0.1
Derivatives	0.6	0.2
Current tax assets	11.1	4.0
Trade and other receivables	17.0	11.1
Financial assets	3.3	104.0
Cash and cash equivalents	15.0	119.4
Total current assets	46.9	238.9
TOTAL ASSETS	8,158.3	8,482.3

M€	31 Dec 2023	31 Dec 2022
Equity attributable to shareholders of the parent company
Share capital	58.0	58.0
Share issue premium	35.8	35.8
Fair value reserve	11.2	43.0
Invested non -restricted equity reserve	164.4	164.4
Retained earnings	3,356.4	3,541.4
Equity attributable to shareholders of the parent company	3,625.9	3,842.7
Total equity	3,625.9	3,842.7
Non -current liabilities
Loans and borrowings	3,007.2	3,330.5
Deferred tax liabilities	829.3	873.7
Derivatives	17.3	1.4
Provisions	0.1	0.3
Other non -current liabilities	4.9	5.0
Total non -current liabilities	3,858.9	4,210.9
Current liabilities
Loans and borrowings	593.2	347.7
Derivatives	-	0.0
Current tax liabilities	4.9	2.5
Trade and other payables	75.4	78.5
Total current liabilities	673.5	428.7
Total liabilities	4,532.4	4,639.6
TOTAL EQUITY AND LIABILITIES	8,158.3	8,482.3

Financial key figures

	31 Dec 2023	30 Sep 2023	30 Jun 2023	31 Mar 2022	31 Dec 2022
Equity ratio, %	44.5	45.0	45.3	44.5	45.3
Interest cover	3.2	3.4	3.6	3.7	3.9
Coverage ratio	3.6	3.9	4.1	3.7	3.8
Loan to Value (LTV), %	44.6	44.3	43.8	42.9	43.7
Hedging ratio, % ¹⁾	93	86	86	84	84
Average interest rate, % ²⁾	2.4	2.3	2.3	1.9	1.9
Average loan maturity, years	2.8	2.9	3.2	3.3	3.5
Average interest rate fixing period, years	2.9	2.8	3.1	3.0	3.2

¹⁾ Bond maturing in 2024 is included in fixed rate loans

²⁾ Includes interest rate derivatives

Important information

This presentation shall not constitute an offer to sell or the solicitation of an offer to buy securitites in any jurisdiction. No part of this presentation, nor the fact of its distribution, should form the basis of, or be relied on in connection with, any contract or commitment or investment decision.

This presentation includes forward-looking statements, which include statements regarding the Kojamo's business strategy, operating and financial targets, financial condition, profitability, results of operations and market data, as well as other statements that are not historical facts. Words such as "believe," "anticipate," "plan," "expect," "target," "estimate," "project," "predict," "forecast," "guideline," "should," "aim," "continue," "could," "guidance," "may," "potential," "will," as well as similar expressions and the negative of such expressions are intended to identify forward-looking statements, but are not the exclusive means of identifying these statements. By their nature, forwardlooking statements are subject to numerous factors, risks and uncertainties that could cause actual outcomes and results to be materially different from those projected. Undue reliance should not be placed on these forward-looking statements. Except for any ongoing disclosure obligation as required by applicable law, Kojamo does not have any intention or obligation to publicly update or revise any forward-looking statements, whether to reflect any future events or circumstances or otherwise.