Public Property Invest

Investor Presentation • Jul 11, 2024

Public Property Invest ASA Half -year results presentation - 11 July 2024

I. Highlights

• II. Operations
• III. Financial update
• IV. Summary and concluding remarks

V. Q&A

Highlights

Key Figures H1 2024

• Net operating income (NOI) NOK 279m with NOI-margin 89.4%.
• Adjusted cashflow from operations NOK 254m.
• Negative portfolio value changes from Q1 affecting results H1 2024. Values flat Q2.
• 92% income from public tenants
• Prolonged or new leases NOK 67.9m positive net letting NOK 11m.
• IPO, SBB acquisition and refinancing: Strong balance sheet, Run-rate NET DEBT/EBITDA 7.8x, LTV 40.2%.

Key Events

NOK 312m Rental income	NOK 279m NOI	NOK 129m Income from property management	NOK 0.62 EPRA Earnings per share
NOK 692m	NOK 1,872	4.8 years	93%
Normalized GRI	GRI / BTA	WAULT	Occupancy
NOK 9.8bn	NOK 26.7k	6.3 %	NOK 26.02
Investment properties	Property value / BTA	NOI yield	EPRA NRV per share

Highlights

Normalised annual run rate

Run rate figures below are presented on a 12 months basis from period end.

1) Based on signed agreements at period end. 2) PPI receives reimbursement of property management fees from management of properties not owned by the Group. The organisation in PPI manages SBB's remaining Norwegian portfolio as well as Nordiqus AB's Norwegian portfolio. 3) Based on interest rates and swap agreements after closed refinancing in April and September 2024. Does not include amortisation of capitalised borrowing cost.

NOK Amounts in million	Q2 2024
Rental income ) 1	692
Other income	0
Property expenses	-69
Net operating income	623
Administration expenses	-66
Reimbursed fee property management ) 2	18
Run EBITDA rate	575
financials Net realised 3)	-265
income from Net property management	310
Net income from per share (NOK) property management	1.49
debt/Run Net Rate EBITDA	7.8x
Run ICR rate	2.2x
LTV	40.2%

PPI will position itself as a leading consolidator with low leverage, high growth ambitions and an attractive dividend policy

1. Subject to growth and overall financial position. The dividend will be paid quarterly. In the short term, the Company intends to take advantage of the current market situation and may prioritise acquisitions and therefore not pay dividends in

accordance with the dividend policy

• I. Highlights
• II. Operations
• III. Financial update
• IV. Summary and concluding remarks
• V. Q&A

7

OPERATIONS

Evenly distributed lease maturity profile

Letting & Occupancy

OPERATIONS

• New and renewed leases of NOK 67.9 million (33,000 sqm)
• No terminated contracts first half year
• Net letting of NOK 10.8 million
• Occupancy at 93%
• Wault at 4.8 years

Property	Tenant	Sqm Contract
Kunnskapsveien 55, Kjeller	Oslo Met	27,000 Renegotiation
Fjørevegen 20, Sogndal	Police	1,740 Renegotiation
Nordstrandveien 41, Bodø	Norgesgruppen	1,689 Renegotiation

Largest new and renegotiated tenants

PPI's competitive rent levels vs. newbuild alternative is a key factor in ensuring costumers retention – and one of the main reasons why OsloMet prolonged its contract at Kunnskapsveien 55

Certified Eco-lighthouse in December 2023 Corresponds with the EU's EMAS eco-labelling (ISO 14001)

Detailed and concrete sustainability strategy, with goal to be climate neutral by 2030

1) Framework and strategy

OPERATIONS

Company commitments and requirements to be certified:

• 1. Develop policies for their property operations
• 1. Map environmental aspects of the properties
• 1. Set goals and measures for sustainability improvement
• 1. Involve tenants in reducing emissions
• 1. Set requirements for suppliers

Overall strategy:

• PPI's board of directors has resolved that PPI must become a climateneutral company within 2030
• The goal is to reduce greenhouse gas emissions by 20% by 2030, of which 16% will come from lower energy use and 4% will come from installation of local solar power, and increased use of renewable energy in the energy mix
• Mechanisms to offset remaining carbon footprint will be:
  • Purchase of Guarantees of Origin (GoO) of Norwegian power for all electricity use in the real estate portfolio
  • Purchase of CO2 allowances for other residual emissions

Share of renewable energy in the energy mix and greenhouse gas emission goals set in line with Carbon Risk Real Estate Monitor (CRREM) Global Pathways

2) KPIs and goals

✓ 1) Framework and strategy ✓ ✓ 3) Measuring and reporting

PPI has mapped out the entire property portfolio using Malling and Co's Energy and Environment tools and created a reporting framework for its KPIs and goals. The mapping of waste handling is still ongoing.

Energy consumption

Water consumption

• I. Highlights
• II. Operations
• III. Financial update
• IV. Summary and concluding remarks
• V. Q&A

IPO and refinancing built the base for strong balance sheet and long-term performance

• Full refinancing of NOK 4 698 million secured bonds and bank loan. Maturity all debt is increased to 3.1 years.
• Acquisition of a portfolio of 13 properties with settlement in shares completed.
• Successful listing at Oslo Stock Exchange. Public offering with cash proceeds from IPO of NOK 1 523 million. Net proceeds from offering amounted to NOK 1 336 million, of which NOK 1 020 million will be used to repay existing debt.
• The completion of above financial transactions has provided the Company with a total new equity of NOK 2 785 million.

Strong performance

▪ Net operating income (NOI) NOK 279m with NOI-margin 89.4%.

▪ EBITDA adjusted for NOK 8m non-recurring administrative expenses relating to IPO was NOK 263m.

▪ Cash-flow from operations NOK 254m, adjusted with non-recurring IPO costs.

▪ EPRA Earnings per share NOK 0.62

12

Income statement

Condensed consolidated statement of comprehensive income Comments

• Rental income for the first half year of 2024 was NOK 312 million, an increase of NOK 23 million compared to the previous period last year. The majority of the increase relates to income from new acquisitions and CPI adjustments from 2023 to 2024.
• NOI amounted to 279 million, NOI margin at 89.4%
• Administrative expenses amounted to 28 million (12). The increase in expenses is mainly due to non-recurring expenses related to the preparation for listing the company on Oslo Stock Exchange as well as cost for converting to IFRS before the IPO. The Group has an income from managing properties not owned by the group. Administration expenses, adjusted with this income and non-recurring costs, was 17 million.
• Transaction costs are due to IPO-process in first half year and are non-recurring costs.

	Half year	Half year	Full year
millions in NOK Amounts	2024	2023	2023
Rental income	312	289	575
Other income	0	0	0
Operating income	313	289	576
Property expenses	-33	-27	-75
operating income Net	279	262	501
Administration expenses	-28	-12	-31
Reimbursed fee property management	4	0	0
realised financials Net	-126	-119	-247
income from Net property management	129	131	223
unrealised financials Net	-25	-12	-25
Transaction costs	-92	0	0
Changes value of financial in instruments	25	33	-25
of Changes value in investment properties	-240	-442	-1 143
(loss) Profit before tax	-203	-290	-969
Income tax expense	-22	22	69
(loss) profit Net	-225	-268	-900

13

Balance sheet summary IFRS figures

FINANCIAL UPDATE

• Approx. NOK 86 million in capex, related to committed tenant alterations, technical upgrades and ESG initiatives for Anton Jenssens gate 5 in Tønsberg
• Tenant alterations are costs solely associated with new lease contracts, extensions, or investment leases for existing tenants
• Tenant alterations include all associated renovation costs, capitalized broker fees and leasing fees to managers

Comment on capex

Comment on value

• 100 % of portfolio valued externally
• Slightly decrease in external valuations for total portfolio in first quarter, below 2 %, flat development in second quarter
• Portfolio net yield 6.3 %

• Like-for-like property values written down by 22 % since peak in 2022

• New equity during first half year amounted to approximately 2.7 million

• Nominal interest-bearing debt is by the end of period 5.5 billion but will be reduced in Q3.

Comment on equity and liabilites

Figures Key	Half year 2024	2023
Net debt/Run EBITDA rate	8x 7	10 7x
ICR	* 2 0x	1 9x
LTV	40 2%	64 9%
EPRA LTV	5% 45	65 1%

Assets, amounts in NOK million	30.06.2024	31.12.2023
Investment properties	9 847	8 336
Interest rate derivatives	41	37
Other non-current assets	6	7
Total non-current assets	9 894	8 380
Trade receivables	2	5
Other current assets	25	15
Cash and cash equivalents	1 108	123
Total current assets	1 135	142
Total assets	11 029	8 522
Equity and liabilites, amounts in NOK million	30.06.2024	31.12.2023
Share capital	10	4
Share premium	6 297	3 591
Translation reserve		0
Retained earnings	-970	-745
Total equity	5 337	2 850
Deferred tax liabilities	66	66
Non-current interest-bearing liabilities	4 874	3 353
Interest rate derivatives	13	34
Other non-current liabilities	26	23
Total non-current liabilities	4 978	3 476
Current interest-bearing liabilities	662	2 152
Trade payables	23	17
Current tax liabilities	0	0
Other current liabilities	28	27
Total current liabilities	713	2 196
Total liabilities	5 692	5 672
Total equity and liabilities	11 029	8 522

* Adjusted EBITDA with non-recurring IPO costs ICR is 2.1x

With ~45% LTV, PPI is well positioned to reduce funding cost over time

future

• Senior secured bank debt from leading Nordic banks extended to 2026 and 2027

• Senior secured bonds (not listed) extended to 2027 and 2028

• Become frequent investment grade bond issuer

• Decrease borrowing margin

Debt maturity and key credit ratios Investment grade financial policy Financing sources now and in the Credit lines to cover short-term interestbearing debt (<12m)

Interest-bearing debt

Average remaining duration borrowing ,	3 1 yrs
(including margin) Average interest rate	4 92 %
Hedging ratio	70 %

Metric	Policy
LTV	50% Below
ICR	2 2x Minimum
Average time maturity to	Minimum 3 yrs
Credit lines to cover short-term interest (<12m) bearing debt	100 %
Dividend	60% of approx. cash earnings paid
First dividend	Targeting 2025

New debt financing

Near-term plan

Interest rate management

70% interest rate exposure is currently fixed

FINANCIAL UPDATE

In-place swaps

SWAPS In place ,	Amount NOK ,	Maturity date	Fixed interest
IRS Nordea	238 500 000	30 06 2026	% 1 34
IRS Nordea	100 000 000	27 03 2025	1 03 %
IRS Nordea	150 000 000	18 04 2028	1 65 %
IRS Danske	27 540 000	30 06 2027	78 % 3
IRS Nordea	27 540 000	30 06 2027	3 80 %
IRS Nordea	409 750 000	30 06 2025	3 46 %
IRS Danske	409 750 000	30 06 2025	% 3 39
IRS Nordea	143 460 000	30 06 2028	3 93 %
IRS Danske	460 000 143	30 06 2028	98 % 3
Total	650 000 000 1		2 92%

Distribution of fixed and floating interest

• I. Highlights
• II. Operations
• III. Financial update

IV. Summary and concluding remarks

V. Q&A

Closing remarks and outlook

Strong operational performance and financial position

FINANCIAL UPDATE

• Strong operational performance
• Strong balance sheet and available liquidity
• Proceeds from IPO improved debt metrics significantly
• Prudent valuations PPI has taken fair value adjustments of approximately 22% since peak in 2022, substantially more than peers
• Good pipeline with possible transactions to further grow the company both in Norway and the Nordics

18

• I. Highlights
• II. Operations
• III. Financial update
• IV. Summary and concluding remarks

V. Q&A

19

Q & A

- Questions can be sent to ir@publicproperty.no

Thank you!

Next report 31 October 2024

For more information: Public Property Invest | Investor relations