Quarterly Report • Feb 8, 2021
Quarterly Report
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AB Sagax is a property company whose business concept is to invest in commercial properties, primarily in the warehouse and light industry segment
Profit from property management for 2021, meaning profit before revaluations and tax, based on the current property portfolio, announced acquisitions and divestments and current exchange rates, is expected to amount to SEK 2,550 M.
| Selected key performance indicators | ||||||
|---|---|---|---|---|---|---|
| 2020 Jan-Dec |
2019 Jan-Dec |
2018 Jan-Dec |
2017 Jan-Dec |
2016 Jan-Dec |
2015 Jan-Dec |
|
| Profit from property management per Class A and B share after dilution, SEK |
6.62 | 5.51 | 4.31 | 3.70 | 2.98 | 2.45 |
| Change compared with preceding year, % | 20 | 28 | 16 | 24 | 22 | 31 |
| Earnings per Class A and B share after dilution, SEK | 10.78 | 12.13 | 9.24 | 8.85 | 7.25 | 4.93 |
| Dividend per Class A and B share, SEK (2020 proposed) | 1.65 | 1.30 | 1.00 | 0.90 | 0.72 | 0.58 |
| Net debt/EBITDA, multiple | 6.4 | 6.6 | 7.4 | 8.1 | 8.7 | 9.3 |
| Interest coverage ratio, multiple | 5.7 | 4.9 | 4.2 | 3.7 | 3.4 | 2.9 |
| Debt ratio, % | 43 | 44 | 47 | 50 | 54 | 59 |
| Properties' market value, SEK M | 37,548 | 32,625 | 29,024 | 23,771 | 20,628 | 16,189 |
| Property yield, % | 6.3 | 6.4 | 6.8 | 6.9 | 7.1 | 7.4 |
A property portfolio consisting of five properties in the Netherlands was acquired in the fourth quarter of 2020. These properties encompass a total of 54,000 square metres of lettable area and 104,000 square metres of land. The properties are fully let to Scheuten Glas Nederland BV, which is a part of the Swiss glass company Glas Trösch AG. The premises are used for the storage and production of glass.
AB Sagax is a property company whose business concept is to invest in commercial properties, primarily in the warehouse and light industry segment.
The overriding objective is the long-term generation of the maximum possible risk-adjusted return to the company's owners. To achieve this objective, Sagax has set the following business targets:
The table and charts below illustrate the outcome for the past five years in relation to the financial targets.
Sagax invests primarily in warehouse and industrial properties. Properties designed as warehouses and for light industries are
attractive investment opportunities, since they generate a high yield combined with a low rate of new production and stable occupancy rates. Sagax invests in add-on acquisitions and in existing properties. Property acquisitions and investments in the existing portfolio aim to increase cash flow and diversify rental revenue, thereby reducing the company's operational and financial risks.
Sagax's financial structure is designed with a clear focus on operating cash flow and interest coverage ratio. This is expected to create both excellent prerequisites for expansion and an attractive return on equity.
The company has four classes of shares: Class A, B and D common shares, and preference shares. The aim of the Class D shares, like the preference shares, is to attract investor categories that value steady ongoing dividends.
Sagax pursues efficiency and sustainability in its management strategy. The management strategy includes clearly prioritising reputable customers with high credit ratings and obtaining long leases. This is regarded as being advantageous since it reduces the risk of vacancies, while leading to lower costs for letting premises and adapting premises to tenant needs.
| Outcome rolling 12 months |
Five-year average |
|
|---|---|---|
| Return on equity, measured over a five-year period, should not fall below 15% per year |
18% | 26% |
| Profit from property management per Class A and B share should increase by a minimum of 15% per year |
20% | 23% |
Annual percentage growth rate, rolling 12 months
Objective for annual growth rate is not less than 15%
The company mainly enters into triple net leases and is thus only affected to a limited extent by changes in consumption or changed rates for such utilities as heating, electricity, property tax, water and sewage.
The aim of Sagax's sustainability activities is to avoid shortterm gains arising at the expense of negative longer-term consequences, such as in the form of externalities. The company's investing activities, management and funding are conducted to achieve the best possible long-term – meaning sustainable – outcome. The planning, governance and monitoring of sustainability activities follow Sagax's organisational structure with well-defined delegation of responsibilities and authorities. Sustainability activities are based on applicable legislation and internal policies.
Sagax has identified the following focus areas:
Sagax's business model is characterised in all areas by a longterm approach. Short-term gains are subordinate to the company's long-term value creation. Accordingly, sustainability work is integrated into the business model.
Sagax works actively to combat all forms of corruption, and has a whistle-blower function available on the Sagax website and a Code of Conduct for Suppliers.
Heating premises and the use of electricity account for the largest share of properties' energy use. Sagax takes regular measures to reduce consumption in a bid to continuously enhance the efficiency of the properties' energy use.
The development of the company is dependent on highly skilled employees. For this reason, it is important that the company is an attractive employer that can attract and has the ability to retain highly skilled personnel. In exchange, employees are expected to assume responsibility of their work duties and also serve as good representatives of the company's values and culture.
The profit/loss and cash flow items below refer to the January to December 2020 period. The comparative items refer to the year-earlier period. Amounts for the balance-sheet items and comparative figures refer to the position at the end of the current period and end of the year-earlier period.
Profit from property management rose 19% to 2,389 M (2,001), of which joint ventures and associated companies accounted for SEK 565 M (441). The increase in profit from property management was attributable to property acquisitions and higher profit from property management in joint ventures and associated companies. Profit from property management per Class A and B share after dilution rose 20% to SEK 6.62 (5.51).
Changes in the value of properties increased profit by SEK 2,003 M (1,956).
Revaluation of financial instruments had an impact of SEK 210 M (884). The revaluation of listed shares resulted in an unrealised change in value of SEK 77 M (594). The revaluation of financial instruments attributable to joint ventures amounted to SEK 156 M (305) pursuant to IFRS 9, while fixed-income derivatives accounted for SEK –24 M (–15).
Profit after tax for the year was SEK 3,711 M (4,111).
Rental revenue rose 12% to SEK 2,898 M (2,581). Revenue was primarily affected by property acquisitions.
Other revenue amounted to SEK 10 M (27). The previous period was primarily impacted by compensation from tenants who prematurely vacated premises, damages due to inadequate maintenance and insurance compensation.
During the year, rental revenue in comparable portfolios increased 2.5% (3.3) excluding currency effects. The largest increase was found in the market segments of the Netherlands (4.2%), Helsinki (4.1%) and Paris (3.9%). Other market segments reported revenue increases of an average of 1.4% in comparable portfolios.
The economic occupancy rate amounted to 95% (95). During the year, the vacancy value rose SEK 128 M (93) due to tenants vacating premises and declined SEK 123 M (98) due to new lettings. Fixed-term rent discounts for new tenants increased SEK 13 M (4) to SEK 35 M (22) on an annual basis at the end of the period. Acquisitions and property divestments during the year increased the vacancy value by SEK 10 (16) M. In total, the vacancy value increased SEK 24 M (3) to SEK 159 M (135) at year end.
Rolling 12 months
Annual change in rental revenue in comparable portfolios
At year end, notice of termination had been served for leases with a rental value of SEK 68 M (85), of which leases with notice of vacating the premises accounted for SEK 68 M (81) and leases with notice of renegotiation for SEK 0 M (4). Of the leases for which notice had been received, vacancies corresponding to SEK 44 M will occur in 2021. Leases for premises that have not yet been occupied reduced the adjusted vacancy value by SEK 17 M (14).
Operating and maintenance costs amounted to a total of SEK 311 M (306). Expenses for property tax increased to SEK 141 M (121). Other property expenses rose to SEK 60 M (47). The increase was due primarily to property acquisitions.
Central administration costs amounted to SEK 132 M (122), corresponding to 4.5% (4.7) of the year's rental revenue.
| Amounts in SEK M | 2020 Jan-Dec |
2019 Jan-Dec |
|---|---|---|
| Opening vacancy for each year | 135 | 132 |
| Vacancies | 128 | 93 |
| New lettings | –123 | –98 |
| Change in discounts provided | 13 | 4 |
| Vacancy value, acquired properties | 11 | 23 |
| Vacancy value, sold properties | –1 | –7 |
| Adjustment of vacancy value | – | –14 |
| Change in exchange rates | –3 | 1 |
| Closing vacancy value | 159 | 135 |
| Terminated for renegotiation | – | 4 |
| Terminated lease, not vacated | 68 | 81 |
| Letting, not occupied | –17 | –14 |
| Adjusted closing vacancy value | 210 | 205 |
At year-end, Sagax had 77 (69) employees. Functions such as property care-taking and on-call operations are outsourced. Sagax has offices in Stockholm, Helsinki, Rotterdam, Paris and Barcelona.
| Total |
|---|
| 35 |
| 24 |
| 7 |
| 7 |
| 4 |
| 77 |
| Year of vacancy | No. of leases |
Rental value, SEK M |
|---|---|---|
| 2021 | 51 | 44 |
| 2022 | 6 | 9 |
| 2023 | 2 | 11 |
| 2024 | 4 | 4 |
| 2025 | – | – |
| >2025 | – | – |
| Total | 63 | 68 |
| Area | Rental value, SEK M |
Vacancy value, SEK M1) |
Economic vacan cy rate1) |
Lettable area, sqm |
Vacant area, sqm |
Vacancy rate by area |
|---|---|---|---|---|---|---|
| Stockholm | 702 | 48 | 7% | 655,000 | 37,000 | 6% |
| Helsinki | 622 | 51 | 8% | 577,000 | 58,000 | 10% |
| Netherlands | 337 | 13 | 4% | 466,000 | 9,000 | 2% |
| Paris | 317 | 11 | 4% | 305,000 | 11,000 | 4% |
| Finland, university cities | 326 | 11 | 3% | 356,000 | 11,000 | 3% |
| Madrid & Barcelona2) | 116 | 15 | 13% | 235,000 | 31,000 | 13% |
| Rest of Sweden | 149 | – | – | 261,000 | – | – |
| Rest of Finland | 216 | 2 | 1% | 326,000 | 5,000 | 2% |
| Rest of Europe | 239 | 7 | 3% | 299,000 | 6,000 | 2% |
| Total | 3,024 | 159 | 5% | 3,480,000 | 168,000 | 5% |
1) The vacancy value and economic vacancy rate take into account both vacancies and discounts provided.
2) Madrid & Barcelona, which was previously reported under Rest of Europe, is reported as a separate segment from 2020.
Profit of joint ventures and associated companies for the period amounted to SEK 1,033 M (917), of which profit from property management accounted for SEK 565 M (441), changes in the value of fixed-income derivatives for SEK –18 M (–5) and changes in the value of properties for SEK 759 M (695). Profit was charged with deferred tax of SEK 272 M (214). Refer also to page 11 for more information.
Interest-bearing liabilities increased to SEK 19,904 M (17,519) due to financing of property acquisitions.
Financial expenses amounted to SEK 481 M (470). The average interest rate was 1.8% (1.9) on 31 December 2020 due to refinancing and new borrowing at lower interest rates.
Financial income of SEK 39 M (20) pertained to interest on bonds and other financial investments.
Sagax obtains external value assessments to determine the properties' market value. The valuations are carried out by independent valuation companies and updated on a quarterly basis. As of 31 December 2020, 98% of the properties were valued by authorised property appraisers. Other properties were acquired in December 2020, and the acquisition price is thus deemed to correspond to the market value.
The value growth for the properties amounted to SEK 1,244 M (1,261), of which unrealised changes in value amounted to SEK 1,274 M (1,301).
| Amounts in SEK M | Jan-Dec 2020 |
|---|---|
| New lettings/Renegotiations | 485 |
| Vacancies/Renegotiations | –364 |
| General change in market value | 1,154 |
| Total | 1,274 |
The change in the value of financial instruments amounted to SEK 210 M (884), of which SEK –18 M (–5) referred to joint ventures.
The change in value attributable to fixed-income derivatives amounted to SEK –24 M (–15), of which SEK –18 M (–5) referred to joint ventures.
Revaluation of listed shares resulted in an unrealised change in value of SEK 77 M (594).
Revaluation of financial instruments regarding joint ventures amounted to SEK 134 M (305) in accordance with IFRS 9.
Sagax recognised a current tax expense of SEK 108 M (100). The deferred tax expense amounted to SEK 511 M (416). The Group's deferred tax liabilities at year end amounted to SEK 2,476 M (2,018).
Cash flow from operating activities before changes in working capital amounted to SEK 2,219 M (1,795). Changes in working capital had a positive impact of SEK 314 M (16) on cash flow. Investing activities had an impact of SEK –5,543 M (–3,051) on cash flow, while cash flow from financing activities amounted to SEK 2,950 M (1,252). In total, cash and cash equivalents changed SEK –62 M (13) during the period.
The Parent Company, AB Sagax, is responsible for stock market issues, such as financial reporting and stock market information. Services between Group companies are charged on commercial terms and conditions and in accordance with market-based pricing. Intra-Group services comprise management services and internal interest charging. The Parent Company's management fees from Group companies amounted to SEK 57 M (55).
Profit from property management for 2021, meaning profit before revaluations and tax, based on the current property portfolio, announced acquisitions and divestments and current exchange rates, is expected to amount to SEK 2,550 M.
Current earnings capacity is reported in conjunction with interim reports and year-end reports.
The table below shows the company's earnings capacity on a 12-month basis at 1 January 2021. It is important to note that this capacity cannot be compared with a forecast for the forthcoming 12 months because it does not contain assessments about, for example, future vacancies, the interest rate scenario, currency effects, rent trends or changes in value.
The rental value is based on contractual rental revenue on an annual basis, with supplements for estimated market rents for vacant premises. Property expenses are based on actual
Current earnings capacity
| Amounts in SEK M | 1 Jan 2021 | 1 Jan 2020 |
|---|---|---|
| Rental value | 3,024 | 2,735 |
| Vacancy | –159 | –135 |
| Rental revenue | 2,865 | 2,600 |
| Property expenses | –495 | –466 |
| Net operating income | 2,370 | 2,134 |
| Central administration | –132 | –122 |
| Joint ventures and associated | ||
| companies | 638 | 539 |
| Net financial items | –372 | –352 |
| Lease expenses | –26 | –22 |
| Profit from property management | 2,479 | 2,178 |
| Tax | –471 | –414 |
| Profit after tax | 2,008 | 1,764 |
| – of which, holders of preference shares |
34 | 34 |
| – of which, holders of Class D shares | 252 | 216 |
| – of which, holders of Class A and B shares |
1,723 | 1,515 |
| Run rate yield, % | 6.2 | 6.5 |
| Net debt/run rate EBITDA, multiple | 6.5 | 6.6 |
dard tax rate of 19% (19).
Shares in profit in joint ventures and associated companies are calculated in accordance with the same assumptions as for Sagax, taking into account the size of the participations.
outcomes over the past 12 months adjusted for the holding period. Central administration costs are based on actual outcomes over the past 12 months. Net financial items are calculated based on interest-bearing liabilities and assets on the balance sheet date. Expenses for interest-bearing liabilities are based on the Group's estimated average interest rate, plus financing costs allocated over time and costs attributable to credit facilities that were unutilised on the balance sheet date. Lease expenses essentially pertain to site leasehold fees that are based on actual outcomes over the past 12 months adjusted for the holding period. Dividends attributable to the company's holdings of listed shares were not taken into account in the earnings capacity. Tax is calculated at the stan-
On 31 December 2020, the property portfolio comprised 673 (553) properties with a lettable area of 3,480,000 square metres (3,022,000). At year-end, the rental value and contractual annual rent amounted to SEK 3,024 M (2,735) and SEK 2,865 M (2,600), respectively. This corresponds to an economic occupancy rate of 95% (95).
During the year, Sagax invested SEK 6,251 M (3,544), of which property acquisitions accounted for SEK 5,585 M (2,836).
A total of 175 properties were acquired with a total lettable area of 661,000 square metres. The largest investment referred to a portfolio of 37 properties in Sweden encompassing 203,000 square metres of lettable area and 560,000 square metres of land. The portfolio was acquired with the intention to establish a joint venture with NP3 Fastigheter AB. The joint venture structure was established on 11 December 2020. In the fourth quarter, a total of 18 properties were acquired with a total lettable area of 105,000 square metres, of which the largest investment referred to a property portfolio of five properties in the Netherlands. A total of SEK 666 M (707)
was invested in the existing property portfolio. SEK 47 M of the investments during the year was made against rent supplements, SEK 123 M was invested in conjunction with new lettings, SEK 324 M in conjunction with new production and SEK 172 M pertained to property maintenance.
The Group has agreed to acquire two properties in France for which possession will be taken after the end of the year. The total investment will amount to SEK 68 M.
During the year, 55 properties were divested for a total of SEK 1,456 M, of which the largest divestment was a portfolio of 37 properties in Sweden in conjunction with the establishment of a joint venture with NP3 Fastigheter AB. Agreements were signed for the sale of one property in Sweden and two properties in Finland for a total of SEK 284 M which will be vacated after the end of the year.
The yield for the year in relation to market value amounted to 6.3% (6.4).
| Market value | Rental value | Economic | annual rent | Contractual | ||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Segment | No. of properties |
Lettable area, sqm |
Vacant area, sqm |
SEK M | SEK per sqm |
SEK M | Share | occupancy rate |
SEK M | Share |
| Stockholm | 78 | 655,000 | 37,000 | 10,552 | 16,100 | 702 | 23% | 93% | 654 | 23% |
| Helsinki | 72 | 577,000 | 58,000 | 6,771 | 11,700 | 622 | 21% | 92% | 572 | 20% |
| Netherlands | 89 | 466,000 | 9,000 | 4,262 | 9,100 | 337 | 11% | 96% | 324 | 11% |
| Paris | 82 | 305,000 | 11,000 | 3,465 | 11,400 | 317 | 10% | 96% | 306 | 11% |
| Finland, university cities | 66 | 356,000 | 11,000 | 3,180 | 8,900 | 326 | 11% | 97% | 314 | 11% |
| Madrid & Barcelona | 67 | 235,000 | 31,000 | 1,813 | 7,700 | 116 | 4% | 87% | 101 | 4% |
| Rest of Sweden | 30 | 261,000 | – | 1,886 | 7,200 | 149 | 5% | 100% | 149 | 5% |
| Rest of Finland | 129 | 326,000 | 5,000 | 2,527 | 7,800 | 217 | 7% | 99% | 215 | 7% |
| Rest of Europe | 60 | 299,000 | 6,000 | 3,093 | 10,300 | 239 | 8% | 97% | 232 | 8% |
| Total | 673 | 3,480,000 | 168,000 | 37,548 | 10,800 | 3,024 | 100% | 95% | 2,865 | 100% |
| Amounts in SEK M | Property acquisitions |
Existing portfolio |
Total | Share of total investments |
Divestments | Net investments |
|---|---|---|---|---|---|---|
| Stockholm | 386 | 297 | 683 | 11% | –295 | 387 |
| Helsinki | 32 | 237 | 269 | 4% | – | 269 |
| Netherlands | 1,039 | 56 | 1,096 | 18% | –55 | 1,040 |
| Paris | 519 | 22 | 541 | 9% | – | 541 |
| Finland, university cities | 97 | 28 | 125 | 2% | –3 | 122 |
| Madrid & Barcelona | 839 | 1 | 840 | 13% | –10 | 831 |
| Rest of Sweden | 1,073 | 7 | 1,080 | 17% | –1,073 | 7 |
| Rest of Finland | – | 14 | 14 | 0% | –20 | –6 |
| Rest of Europe | 1,600 | 3 | 1,604 | 26% | – | 1,604 |
| Total | 5,585 | 666 | 6,251 | 100% | –1,456 | 4,795 |
Sagax has a diverse lease structure, which better allows the company to maintain an even occupancy rate. To reduce the risk of lower rental revenue, Sagax endeavours to create longterm relationships with the company's existing tenants and to achieve favourable diversification in terms of the length and size of its leases.
Sagax's annual rent at year end was distributed between 1,813 leases (1,724), with about 1,200 tenants (1,000). The table below presents the size of Sagax's leases in relation to the Group's annual rent at year end. The table shows that 1,802 leases (1,715) each had a rental value of less than 1% of the Group's annual rent. The total rental value for these leases accounted for 80% (83) of Sagax's annual rent. In addition, Sagax is party to eight leases (six) with a rental value corresponding to 1–2% of the Group's annual rent. Combined, these leases total 11% (9) of Sagax's annual rent. Only three (three) of Sagax's leases had an annual rental value that accounted for more than 2% of the Group's rental revenue. These leases together represented 8% (8) of the Group's contractual annual rent.
Sagax's tenants operate in a variety of sectors. 16% (13) of rental revenue comes from tenants with food-related operations, 16% (18) from companies in the manufacturing industry and 11% (12) in the automotive-related industry, including sales, service and manufacturing. Diverse tenant industries is considered to lower the risk of vacancies and rent losses. The main sectors are presented in the pie chart below.
According to Sagax's management strategy, the company strives to secure long-term leases and an even distribution of contract maturities over the years. This is deemed to reduce the risk of significant variations in the Group's occupancy rate. Leases representing 52% of the annual rent expire in or after 2025. 10-14% of annual rent expires every year between 2021 and 2024.
| Share of contractual annual rent |
Annual rent SEK M Share |
No. of leases |
Average annual rent, SEK M |
Lease term, years |
|
|---|---|---|---|---|---|
| > 2% | 241 | 8 | 3 | 80 | 10 |
| 1–2 % | 322 | 11 | 8 | 40 | 6 |
| < 1% | 2,302 | 80 | 1,802 | 1 | 5 |
| Total | 2,865 | 100 | 1,813 | 2 | 5 |
Other, 14%
Industry exposure
| Lease terms | |||
|---|---|---|---|
| Annual rent | |||
| Year of expiry | Area, sqm | SEK M | Share |
| 2021 | 461,000 | 390 | 14% |
| 2022 | 391,000 | 374 | 13% |
| 2023 | 360,000 | 341 | 12% |
| 2024 | 269,000 | 288 | 10% |
| 2025 | 548,000 | 375 | 13% |
| > 2025 | 1,282,000 | 1,098 | 39% |
| Total | 3,312,000 | 2,865 | 100% |
Year of maturity of annual rent
Sagax prepares its consolidated financial statements in accordance with International Financial Reporting Standards (IFRS). The company has chosen to recognise its properties at fair value in accordance with the Fair Value Method.
Sagax obtains external value assessments to determine the properties' market value. The valuations are carried out by independent valuation companies and updated on a quarterly basis.
At 31 December 2020, the total market value of Sagax's 673 properties (553) was SEK 37,548 M (32,625). Exchange-rate fluctuations during the year resulted in property values abroad declining by SEK 1,146 M (209).
The total unrealised change in value recognised during the year was SEK 1,274 M (1,301).
The valuations were carried out in accordance with generally accepted international valuation methods. As of 31 December 2020, 98% of valuation objects were valued by authorised property appraisers from independent valuation companies.
The principle method of appraisal used was cash flow calculations in which the present value of net operating income, investments and residual values was calculated. The calculation
| SEK M | No. of | |
|---|---|---|
| Property portfolio, 31 December 2019 | 32,625 | 553 |
| Acquisition of properties | 5,585 | 175 |
| Investments in the current portfolio | 666 | |
| Property sales | –1,456 | –55 |
| Translation effect, currencies | –1,146 | |
| Unrealised changes in value | 1,274 | |
| Property portfolio, 31 December 2020 | 37,548 | 673 |
period was adjusted to the remaining term of existing leases and varies between five and 20 years. As a rule, the calculation period is ten years. For more information, see Sagax's 2019 Annual Report, page 93.
The cost of capital for the present value calculation of cash flows (4.6–16.0%), the cost of capital for the present value calculation of residual values (4.6–16.0%) and the yield requirement for the residual value calculations (4.0–14.0%) are based on analyses of transactions carried out and on individual assessments of the risk level and market position of each property.
The weighted cost of capital for the present value calculation of cash flows and residual values for the property portfolio was 7.4% (7.8) and 7.7% (8.1), respectively. The weighted yield requirement was 6.5% (6.6) on 31 December 2020. By comparison, the yield reported by Sagax for the year was 6.3% (6.4). A comparison of the yield reported over time and the yield requirement used in valuations is provided below. A sensitivity analysis is found on page 25.
Sagax's joint ventures and associated companies contributed a total of SEK 562 M (441) to profit from property management during the year. Sagax's share of changes in the value of properties amounted to SEK 759 M (695) and the share of changes in the value of derivatives was SEK –18 M (–5) for the period. The total value of the commitment related to ownership of joint ventures and associated companies amounted to SEK 6,833 M (5,693).
Via Hemsö Intressenter AB, Sagax indirectly owns 15% of Hemsö Fastighets AB, with the remaining share owned by the Third Swedish National Pension Fund. Hemsö Fastighets AB conducts operations in Sweden, Germany and Finland. Operations consist of owning, managing and developing public properties. The property portfolio encompasses 392 properties with a total property value of SEK 62 billion at 31 December 2020. 94% of rental revenue derives from tax-financed operations. For more information, refer to the company's website, hemso.se.
Sagax owns 50% of Söderport Holding AB, with the remaining share owned by Nyfosa AB. Söderport's operations consist of owning, managing and developing properties in Sweden. On behalf of Söderport, Sagax handles the financial administration and most of the property management of the Söderport Group. Nyfosa is responsible for property management in Gothenburg.
A corresponding 69% of Söderport's rental value of SEK 894 M was located in Stockholm on 31 December 2020. Söderport's economic vacancies amounted to SEK 51 M (33) at year end, corresponding to a vacancy rate of 6% (4). Of the economic vacancies, SEK 21 M (9) comprised fixed-term rent discounts provided for new lettings. At year end, Stockholm accounted for 95% of the economic vacancies. Söderport also owns 78.4% of Torslanda Property Investment AB, which is thus included as a subsidiary in Söderport's consolidated financial statements.
Sagax owns 50% of Fastighetsaktiebolaget Ess-Sierra, with the remaining share owned by NP3 Fastigheter AB. Ess-Sierra was established in December 2020 and its operations entail owning and managing 37 properties that are let to Beijer Byggmaterial AB. The lettable area amounts to 203,000 square metres, of which 64% comprises warehouse premises, 27% building materials retail and 9% office premises. Most of the properties are situated in university and regional towns.
Sagax owns 20% of the votes and 14% of the capital in NP3 Fastigheter AB. NP3 Fastigheter AB is a property company focusing on commercial investment properties with high yields mainly in northern Sweden. The company's property portfolio encompassed 382 properties with a total property value of SEK 12.1 billion and a rental value of SEK 1,198 M on 30 September 2020. NP3 Fastigheter AB is listed on Nasdaq Stockholm, Mid Cap. For more information, refer to the company's website, np3fastigheter.se.
Sagax owns 25% of Fastighetsbolaget Emilshus AB. Emilshus acquires, develops and manages commercial properties in Småland. The property portfolio encompassed 56 properties on 30 September 2020. For more information, refer to the company's website, emilshus.com.
| Hemsö | Söderport | Sierra1) | |||||
|---|---|---|---|---|---|---|---|
| Jan – Dec 2020 | Jan – Dec 2019 | Jan – Dec 2020 | Jan – Dec 2019 | Jan – Dec 2020 | Jan – Dec 2019 | ||
| Sagax's participating interest, % | 15 | 15 | 50 | 50 | 50 | – | |
| Rental revenue, SEK M | 3,270 | 3,027 | 818 | 708 | 5 | – | |
| Profit from property management, SEK M | 1,768 | 1,760 | 466 | 384 | 3 | – | |
| Profit for the year, SEK M | 3,333 | 3,111 | 844 | 929 | 49 | – | |
| Sagax's share of profit from property | |||||||
| management, SEK M | 223 | 218 | 217 | 192 | 1 | – | |
| – | |||||||
| No. of properties | 392 | 370 | 82 | 80 | 37 | – | |
| Carrying amount of properties, SEK M | 62,240 | 55,027 | 11,909 | 10,853 | 1,440 | – | |
| Lettable area, sqm | 2,005,000 | 1,884,000 | 778,000 | 761,000 | 203,000 | – | |
| Lease term, years | 9.9 | 9.9 | 4.8 | 4.6 | 6.8 | – | |
| Economic vacancy rate, % | 2 | 2 | 6 | 4 | – | – | |
| Interest-bearing liabilities, SEK M | 38,652 | 35,542 | 6,354 | 5,828 | 842 | – | |
| Loan maturity, years | 6.7 | 7.4 | 3.5 | 4.5 | 4.0 | – | |
| Fixed interest, years | 6.2 | 6.4 | 3.1 | 3.1 | 3.2 | – | |
| Market value of derivatives, SEK M | –231 | –211 | –219 | –208 | – | – | |
| Carrying amount, SEK M | 2,318 | 1,821 | 1,903 | 1,804 | 264 | – | |
1) Sierra was established in December 2020
Consolidated equity amounted to SEK 22,452 M (19,257) at 31 December 2020. Changes in equity during the year were attributable to comprehensive income of SEK 3,374 M, a new issue of Class D common shares of SEK 508 M after transaction costs, a new issue of Class B common shares linked to the incentive plan of SEK 11 M and a share dividend of SEK –697 M.
Sagax's interest-bearing liabilities at the end of the year amounted to SEK 19,904 M (17,519). An amount corresponding to SEK 15,403 M (13,557) of liabilities was raised in EUR.
Gross interest-bearing debt to banks totalled SEK 4,125 M (4,257). The remaining interest-bearing debt comprised listed bond loans of SEK 14,698 M (12,070) and commercial paper of SEK 1,081 M (1,192).
Unsecured liabilities corresponded to 74% (69) of Sagax's interest-bearing liabilities. Secured liabilities and commercial paper comprised 26% (31) of Sagax's interest-bearing liabilities.
The interest coverage ratio at the end of the year amounted to 575% (492) and the debt ratio to 43% (44). Net interestbearing debt for the past 12 months was 6.4 (6.6) times EBITDA and 6.5 (6.6) times run rate EBITDA, see page 7 for more information.
A total of SEK 7,927 M (7,366) in loans was raised, of which SEK 3,309 M (5,031) in the form of bond loans under the framework of Sagax's EMTN programme. Repayments during the period totalled SEK 4,791 M (5,734). Exchangerate fluctuations reduced interest-bearing liabilities by SEK 750 M (increased SEK 124 M for the preceding year).
Net interest-bearing debt totalled SEK 17,190 M (15,232).
Allocated borrowing costs of SEK 76 M (82) reduced interest-bearing liabilities in the balance sheet. Interestbearing liabilities of SEK 19,828 M (17,437) were recognised. The average remaining fixed-interest and loan maturity terms were 3.4 years (3.5) and 3.4 years (3.8), respectively, at year end. The average interest rate on the company's interestbearing liabilities was 1.8% (1.9), including the effect of derivatives.
| Fixed interest | Loan maturity | Interest-rate swaps | |||||
|---|---|---|---|---|---|---|---|
| Year of expiry | SEK M | Interest rate | Share | SEK M | Share | SEK M | Interest rate |
| 2021 | 2,760 | 0.3% | 14% | 700 | 4% | – | – |
| 2022 | 1,253 | 3.0% | 6% | 1,637 | 8% | 453 | 0.7% |
| 2023 | 2,295 | 2.8% | 12% | 4,837 | 24% | 430 | 0.2% |
| 2024 | 5,235 | 1.9% | 26% | 5,019 | 25% | – | |
| 2025 | 4,068 | 1.9% | 20% | 4,701 | 24% | – | |
| > 2025 | 4,294 | 1.2% | 22% | 3,011 | 15% | 1,283 | 1.3% |
| Total/average | 19,904 | 1.8% | 100% | 19,904 | 100% | 2,166 | 0.9% |
| Net debt | |
|---|---|
| ---------- | -- |
| Amounts in SEK M | 31 Dec 2020 | 31 Dec 2019 |
|---|---|---|
| Interest-bearing liabilities | 19,904 | 17,519 |
| Interest-bearing assets | –550 | –511 |
| Cash and cash equivalents | –24 | –86 |
| Listed shares | –2,140 | –1,690 |
| Net debt | 17,190 | 15,232 |
Net debt/EBITDA, rolling 12 month
Sagax has SEK 12,393 M (9,720) in loans at fixed interest rates. The company has interest-rate caps and interest-rate swaps with a total nominal value of SEK 6,060 M (6,261), of which interest-rate swaps with an average interest rate of 0.9% (1.4) accounted for SEK 2,166 M (2,009).
Sagax's working capital, excluding prepaid rental revenue and including listed shares, amounted to SEK –137 M (140) on 31 December 2020. At the same date, unutilised credit facilities including back-up facilities for commercial paper programmes amounted to SEK 5,424 M (3,652). No additional collateral needs to be pledged to utilise these credit facilities.
| Maturity | SEK M | Current interest | Interest terms | Maturity date | ISIN code |
|---|---|---|---|---|---|
| 2017-2021 | 600 | 2.20% | Stibor 3M+2.25% | 1 Feb 2021 | SE0010636274 |
| 2017-2022 | 1,250 | 2.10% | Stibor 3M+2.15% | 15 Feb 2022 | SE0010324228 |
| 2019-2023 | 500 | 0.85% | Stibor 3M+0.90% | 16 June 2023 | XS2093119175 |
| 2019-20231) | 250 | 1.13% | 1.13% | 16 June 2023 | XS2093119845 |
| Total/average | 2,600 | 1.79% | |||
| Maturity | EUR M | ||||
| 2018-20241) | 500 | 2.00% | 2.00% | 17 Jan 2024 | XS1877540465 |
| 2019-20251) | 300 | 2.25% | 2.25% | 13 Mar 2025 | XS1962543820 |
| 2019-20251) | 1052) | 0.87% | 2.25%3) | 13 Mar 2025 | XS1962543820 |
| 2020-20271) | 300 | 1.12% | 1.12% | 30 Jan 2027 | XS2112816934 |
| Total/average | 1,205 | 1.75% | |||
| 1) Fixed-rate loans |
2) The nominal value is EUR 100 M.
3) Coupon rate.
| Amounts in SEK M | Nominal amount |
Years to maturity |
Market value 31 Dec 2020 |
Market value 31 Dec 2019 |
Change for the period |
|---|---|---|---|---|---|
| Nominal interest-rate swaps | 2,166 | 4.9 | -118 | -119 | 1 |
| Interest-rate caps | 3,894 | 1.6 | 0 | 0 | 0 |
| Total | 6,060 | -118 | -119 | 1 |
| Financial covenant in EMTN programme |
2020 31 Dec |
2019 31 Dec |
|
|---|---|---|---|
| Rating according to Moody's Investor Services | Baa3, Stable outlook | Baa3, Stable outlook | |
| Net debt/Total assets | < 65% | 37% | 38% |
| Interest coverage ratio | >1.8x | 6.5x | 5.3x |
| Secured liabilities/total assets | < 45% | 11% | 14% |
Year-end report 2020 13 This document is an in-house translation of the Swedish Interim report. In the event of discrepancies, the Swedish original will supersede the translation.
| 2020 | 2019 | 2020 | 2019 | |
|---|---|---|---|---|
| Amounts in SEK M | Jan-Dec | Jan-Dec | Oct-Dec | Oct-Dec |
| Rental revenue | 2,898 | 2,581 | 746 | 663 |
| Other revenue | 10 | 27 | 3 | 1 |
| Operating expenses | –232 | –222 | –62 | –57 |
| Maintenance costs | –79 | –84 | –22 | –25 |
| Property tax Other property expenses |
–141 –60 |
–121 –47 |
–38 –17 |
–32 –14 |
| Net operating income | 2,397 | 2,133 | 610 | 536 |
| Central administration | –132 | –122 | –46 | –44 |
| Profit from joint ventures and associated companies | 1,033 | 917 | 446 | 463 |
| – of which, profit from property management | 565 | 441 | 146 | 126 |
| – of which, changes in value | 741 | 690 | 412 | 441 |
| – of which, tax | –272 | –214 | –112 | –105 |
| Financial income | 39 | 20 | 9 | 2 |
| Financial expenses | –455 | –446 | –120 | –96 |
| Financial expense, interest component of leases | –26 | –24 | –7 | –6 |
| Profit including changes in value of | ||||
| joint ventures and associated companies | 2,857 | 2,478 | 894 | 854 |
| – of which, profit from property management | 2,389 | 2,001 | 594 | 518 |
| Changes in value: | ||||
| Properties, realised | –30 | –40 | –19 | –22 |
| Properties, unrealised | 1,274 | 1,301 | 824 | 775 |
| Financial instruments, realised | 1 | – | 1 | – |
| Financial instruments, unrealised | 228 | 889 | 106 | 146 |
| Profit before tax | 4,330 | 4,627 | 1,806 | 1,753 |
| Deferred tax | –511 | –416 | –250 | –298 |
| Current tax | –108 | –100 | –24 | 74 |
| Profit for the period | 3,711 | 4,111 | 1,532 | 1,529 |
| Other comprehensive income | ||||
| – items that may be reversed to profit or loss: | ||||
| Translation differences for foreign operations | –693 | 217 | –845 | –343 |
| Share of other comprehensive income for joint ventures | –13 | 13 | –21 | –10 |
| Translation differences pertaining to hedge accounting | 355 | –143 | 434 | 181 |
| Tax on items that may be reversed to profit or loss | 14 | 3 | 18 | 7 |
| Comprehensive income for the period | 3,374 | 4,201 | 1,118 | 1,365 |
| Earnings per Class A and B share, SEK | 10.80 | 12.15 | 4.61 | 4.61 |
| Earnings per Class A and B share after dilution, SEK | 10.78 | 12.13 | 4.60 | 4.60 |
| Earnings per Class D share, SEK | 2.00 | 2.00 | 2.00 | 2.00 |
| Average no. of Class A and B shares, millions | 317.1 | 316.9 | 317.3 | 317.0 |
| Average no. of Class A and B shares after dilution, millions | 317.7 | 317.3 | 317.8 | 317.5 |
| Average number of Class D shares, millions | 118.4 | 105.7 | 125.8 | 105.7 |
| Amounts in SEK M | 2020 31 Dec |
2019 31 Dec |
|---|---|---|
| Investment properties | 37,264 | 32,333 |
| Investment properties for sale | 284 | 292 |
| Leases, right-of-use assets | 368 | 346 |
| Joint ventures and associated companies | 6,833 | 5,693 |
| Interest-bearing non-current receivables | 550 | 511 |
| Other fixed assets | 130 | 58 |
| Total fixed assets | 45,429 | 39,233 |
| Cash and bank balances | 24 | 86 |
| Listed shares | 738 | 405 |
| Other current assets | 430 | 429 |
| Total current assets | 1,193 | 921 |
| Total assets | 46,622 | 40,154 |
| Equity | 22,452 | 19,257 |
| Non-current interest-bearing liabilities | 17,977 | 16,052 |
| Deferred tax liabilities | 2,476 | 2,018 |
| Fixed-income derivatives | 118 | 119 |
| Lease liability, right-of-use assets | 394 | 370 |
| Other non-current liabilities | 145 | 94 |
| Total non-current liabilities | 21,110 | 18,653 |
| Commercial paper | 1,081 | 1,192 |
| Other current interest-bearing liabilities | 770 | 193 |
| Other current liabilities | 1,209 | 858 |
| Total current liabilities | 3,060 | 2,243 |
| Total equity and liabilities | 46,622 | 40,154 |
| 2020 | 2019 | 2020 | 2019 | |
|---|---|---|---|---|
| Amounts in SEK M | Jan-Dec | Jan-Dec | Oct-Dec | Oct-Dec |
| Profit before tax | 4,330 | 4,627 | 1,806 | 1,753 |
| Changes in value of financial instruments | –228 | –889 | –107 | –146 |
| Change in value of properties | –1,244 | –1,261 | –805 | –755 |
| Result from ownership of joint ventures and associated companies |
–1,033 | –917 | –446 | –463 |
| Dividend from joint ventures and associated companies | 424 | 281 | 20 | 17 |
| Dissolution of allocated borrowing costs | 47 | 42 | 18 | 8 |
| Other items not included in cash flow | –21 | –14 | –17 | –13 |
| Tax paid | –55 | –74 | –27 | –2 |
| Cash flow from operating activities before | ||||
| changes in working capital | 2,219 | 1,795 | 441 | 426 |
| Cash flow from changes in current receivables | 77 | –4 | 49 | 108 |
| Cash flow from changes in current liabilities | 237 | 20 | 105 | –142 |
| Cash flow from operating activities | 2,533 | 1,811 | 595 | 392 |
| Acquisition of properties | –5,585 | –2,836 | –747 | –921 |
| Property sales | 1,426 | 1,413 | 1,380 | 492 |
| Investments in existing properties | –666 | –707 | –209 | –184 |
| Acquisition of listed shares | –256 | –64 | –155 | – |
| Acquisition of financial instruments | –7 | –503 | – | –503 |
| Acquisition of joint ventures and associated companies | –260 | –178 | –246 | –178 |
| Capital contribution to joint ventures and associated | ||||
| companies | –150 | –150 | – | – |
| Lending to joint ventures and associated companies | –41 | – | –41 | – |
| Increase in other fixed assets | –10 | –25 | – | –21 |
| Decrease in other fixed assets | 6 | – | 11 | – |
| Cash flow from investing activities | –5,543 | –3,051 | –7 | –1,315 |
| Issue of Class D and B shares | 527 | 198 | – | – |
| Dividend paid to shareholders | –679 | –560 | –278 | –62 |
| Incentive plan | –9 | 9 | – | – |
| Borrowings | 7,886 | 7,322 | 255 | 1,087 |
| Repayment of loans | –4,791 | –5,734 | –706 | –482 |
| Redemption of financial derivatives | –8 | – | –8 | – |
| Deposits from tenants | 24 | 28 | – | 5 |
| Increase in other non-current liabilities | 1 | – | – | – |
| Decrease in other non-current liabilities | – | –11 | –1 | –3 |
| Cash flow from financing activities | 2,950 | 1,252 | –739 | 544 |
| Cash flow for the period | –60 | 12 | –151 | –380 |
| Exchange rate differences in cash and cash equivalents | –2 | 1 | –2 | –1 |
| Change in cash and cash equivalents | –62 | 13 | –153 | –381 |
| Cash and cash equivalents at beginning of period | 86 | 73 | 177 | 467 |
| Cash and cash equivalents at end of period | 24 | 86 | 24 | 86 |
| Amounts in SEK M | Share capital | Other contributed capital |
Reserves, translation differences |
Profit earned incl. net profit for the period |
Total equity1) |
|---|---|---|---|---|---|
| Equity, 31 December 2018 | 487 | 3,126 | 585 | 11,218 | 15,416 |
| Issue of Class D shares | 10 | 191 | _ | _ | 201 |
| Transaction costs | –3 | – | – | –3 | |
| Bonus issue | 279 | –279 | – | – | – |
| Issue of Class B shares, incentive plan | 0 | 11 | – | – | 11 |
| Dividends | – | – | – | –566 | –566 |
| Redemption of incentive plan | – | – | – | –7 | –7 |
| Incentive plan | – | – | – | 4 | 4 |
| Comprehensive income, January-December 2019 |
– | – | 90 | 4,111 | 4,201 |
| Equity, 31 December 2019 | 776 | 3,046 | 675 | 14,760 | 19,257 |
| Issue of Class D shares | 32 | 481 | – | – | 513 |
| Transaction costs | – | –5 | – | – | –5 |
| Issue of Class B shares, incentive plan | – | – | – | 20 | 20 |
| Dividends | – | – | – | –697 | –697 |
| Redemption of incentive plan | – | – | – | –14 | –14 |
| Incentive plan | – | – | – | 5 | 5 |
| Comprehensive income, January-December 2020 |
– | – | –337 | 3,711 | 3,374 |
| Equity, 31 December 2020 | 808 | 3,522 | 338 | 17,785 | 22,452 |
1) Equity is attributable in its entirety to the Parent Company's shareholders.
| Profit items | Net operating | Changes in value, properties | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| per segment | Rental revenue1) | income | Unrealised | Realised | Total yield | |||||
| Amounts in SEK M | 2020 Jan-Dec |
2019 Jan-Dec |
2020 Jan-Dec |
2019 Jan-Dec |
2020 Jan-Dec |
2019 Jan-Dec |
2020 Jan-Dec |
2019 Jan-Dec |
2020 Jan-Dec |
2019 Jan-Dec |
| Stockholm | 671 | 657 | 565 | 542 | 324 | 362 | –3 | – | 886 | 904 |
| Helsinki | 593 | 581 | 469 | 468 | 64 | 65 | – | –12 | 532 | 521 |
| Netherlands | 291 | 212 | 281 | 190 | 411 | 277 | –17 | – | 675 | 467 |
| Paris | 299 | 242 | 238 | 181 | 159 | 223 | – | –1 | 398 | 404 |
| Finland, university cities | 335 | 317 | 263 | 249 | 40 | 52 | 2 | –3 | 305 | 298 |
| Madrid & Barcelona2) | 101 | 10 | 87 | 10 | 236 | 54 | –1 | – | 322 | 63 |
| Rest of Sweden | 151 | 195 | 143 | 185 | 51 | 16 | –1 | –14 | 193 | 187 |
| Rest of Finland | 231 | 233 | 209 | 210 | –1 | 179 | –11 | –13 | 196 | 376 |
| Rest of Europe | 225 | 134 | 206 | 124 | –9 | 74 | – | 1 | 197 | 199 |
| Non-specified | – | – | –64 | –25 | – | – | 1 | – | –63 | –25 |
| Total | 2,898 | 2,581 | 2,397 | 2,133 | 1,274 | 1,301 | –30 | –40 | 3,641 | 3,393 |
| Asset items per segment |
Market value properties |
Investment properties |
Acquisition properties |
Divestment properties |
||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Amounts in SEK M | 2020 31 Dec |
2019 31 Dec |
2020 Jan-Dec |
2019 Jan-Dec |
2020 Jan-Dec |
2019 Jan-Dec |
2020 Jan-Dec |
2019 Jan-Dec |
||||
| Stockholm | 10,552 | 9,840 | 297 | 302 | 386 | 27 | –295 | –672 | ||||
| Helsinki | 6,771 | 6,708 | 237 | 206 | 32 | 53 | – | –43 | ||||
| Netherlands | 4,262 | 2,982 | 56 | 16 | 1,039 | 859 | –55 | – | ||||
| Paris | 3,465 | 2,919 | 22 | 125 | 519 | 674 | – | –117 | ||||
| Finland, university cities | 3,180 | 3,148 | 28 | 23 | 97 | 309 | –3 | –4 | ||||
| Madrid & Barcelona2) | 1,813 | 888 | 1 | – | 839 | 846 | –10 | – | ||||
| Rest of Sweden | 1,886 | 1,828 | 7 | 2 | 1,073 | – | –1,073 | –583 | ||||
| Rest of Finland | 2,527 | 2,634 | 14 | 31 | – | 43 | –20 | –25 | ||||
| Rest of Europe | 3,093 | 1,676 | 3 | 3 | 1,600 | 25 | – | –10 | ||||
| Total | 37,548 | 32,625 | 666 | 707 | 5,585 | 2,836 | –1,456 | –1,453 |
1) All rental revenue pertains to external tenants.
2) Madrid & Barcelona, which was previously reported under Rest of Europe, is reported as a separate segment from 2020.
| 2020 Jan-Dec |
2019 Jan-Dec |
2018 Jan-Dec |
2017 Jan-Dec |
2016 Jan-Dec |
2015 Jan-Dec |
|
|---|---|---|---|---|---|---|
| Property-related key figures | ||||||
| Yield, % | 6.3 | 6.4 | 6.8 | 6.9 | 7.1 | 7.4 |
| Surplus ratio, % | 83 | 83 | 83 | 83 | 85 | 86 |
| Occupancy rate by area, % | 95 | 95 | 95 | 95 | 93 | 97 |
| Economic occupancy rate, % | 95 | 95 | 95 | 94 | 94 | 96 |
| Lettable area at the end of the period, 000 sqm | 3,480 | 3,022 | 2,850 | 2,489 | 2,312 | 1,860 |
| No. of properties at the end of the period | 673 | 553 | 512 | 495 | 440 | 225 |
| Financial key figures | ||||||
| Return on total capital, % | 7 | 7 | 7 | 7 | 7 | 8 |
| Return on equity, % | 18 | 24 | 24 | 30 | 33 | 32 |
| Average interest rate, % | 1.8 | 1.9 | 2.2 | 3.0 | 3.1 | 3.3 |
| Fixed-interest period incl. derivatives, years | 3.4 | 3.5 | 3.0 | 2.1 | 2.7 | 3.0 |
| Loan maturity, years | 3.4 | 3.8 | 3.6 | 3.1 | 3.6 | 4.2 |
| Equity/assets ratio, % | 48 | 48 | 46 | 42 | 38 | 34 |
| Debt ratio, % | 43 | 44 | 47 | 50 | 54 | 59 |
| Net debt/run rate EBITDA, multiple | 6.5 | 6.6 | 7.1 | 7.7 | 7.8 | 8.3 |
| Net debt/EBITDA, multiple | 6.4 | 6.6 | 7.4 | 8.1 | 8.7 | 9.3 |
| Interest coverage ratio, multiple Interest coverage ratio, EMTN programme, multiple |
5.7 6.4 |
4.9 5.3 |
4.2 4.3 |
3.7 4.0 |
3.4 3.7 |
2.9 3.3 |
| Data per Class A and B share1) | ||||||
| Price of Class B share at the end of the period, SEK | 169.60 | 136.20 | 65.70 | 49.10 | 40.87 | 35.87 |
| Net asset value, SEK | 66.38 | 56.77 | 44.22 | 35.04 | 26.89 | 17.76 |
| Equity, SEK | 55.19 | 46.86 | 35.70 | 27.15 | 19.61 | 13.01 |
| Equity after dilution, SEK | 55.09 | 46.78 | 35.67 | 27.13 | 19.57 | 12.96 |
| Earnings, SEK | 10.80 | 12.15 | 9.24 | 8.86 | 7.27 | 4.94 |
| Earnings after dilution, SEK | 10.78 | 12.13 | 9.24 | 8.85 | 7.25 | 4.93 |
| Profit from property management, SEK | 6.63 | 5.51 | 4.31 | 3.71 | 2.99 | 2.46 |
| Profit from property management after dilution, SEK | 6.62 | 5.51 | 4.31 | 3.70 | 2.98 | 2.45 |
| Cash flow, SEK | 6.10 | 4.86 | 3.95 | 3.27 | 2.57 | 2.00 |
| Cash flow after dilution, SEK | 6.09 | 4.86 | 3.95 | 3.26 | 2.56 | 2.00 |
| Dividend per share, SEK (proposed for 2020) | 1.65 | 1.30 | 1.00 | 0.90 | 0.72 | 0.58 |
| No. at end of period, millions | 317.3 | 317.1 | 316.8 | 316.5 | 316.5 | 316.5 |
| No. at end of period after dilution, millions | 317.9 | 317.5 | 317.1 | 316.7 | 317.1 | 317.5 |
| Average no., millions | 317.1 | 316.9 | 316.7 | 316.5 | 316.5 | 316.5 |
| Average no. after dilution, millions | 317.7 | 317.3 | 316.9 | 317.0 | 317.2 | 317.6 |
| Data per Class D share | ||||||
| Share price at the end of period, SEK | 32.05 | 36.35 | 31.70 | 29.92 | 28.30 | – |
| Equity, SEK | 35.00 | 35.00 | 35.00 | 35.00 | 35.00 | – |
| Earnings, SEK | 2.00 | 2.00 | 2.00 | 2.00 | 2.00 | – |
| Dividend per share, SEK | 2.00 | 2.00 | 2.00 | 2.00 | 2.00 | – |
| No. at end of period, millions | 125.8 | 107.8 | 101.9 | 63.6 | 18.2 | – |
| Average no., millions | 118.4 | 105.7 | 83.0 | 43.1 | 2.9 | – |
| Data per preference share | ||||||
| Share price at the end of period, SEK | 35.70 | 38.40 | 34.85 | 33.40 | 30.40 | 31.30 |
| Equity, SEK | 32.00 | 32.00 | 32.00 | 32.00 | 32.00 | 32.00 |
| Earnings, SEK | 2.00 | 2.00 | 2.00 | 2.00 | 2.00 | 2.00 |
| Dividend per share, SEK | 2.00 | 2.00 | 2.00 | 2.00 | 2.00 | 2.00 |
| No. at end of period, millions | 16.8 | 16.8 | 16.8 | 16.8 | 58.2 | 58.2 |
| Average no., millions | 16.8 | 16.8 | 16.8 | 35.5 | 58.2 | 57.8 |
1) Excluding 2,000,000 Class B shares bought back.
| 2020 | 2019 | |
|---|---|---|
| Amounts in SEK M | Jan-Dec | Jan-Dec |
| Net sales | 77 | 73 |
| Administration costs | –94 | –89 |
| Loss before financial income and expenses | –17 | –16 |
| Profit from participations in Group companies | 511 | 258 |
| Profit from participations in joint ventures | 85 | 64 |
| Financial income | 44 | 616 |
| Financial expenses | –85 | –673 |
| Profit before tax and appropriations | 538 | 249 |
| Appropriations | 52 | 98 |
| Tax | –2 | –4 |
| Profit for the period | 589 | 343 |
| Other comprehensive income | ||
| Other comprehensive income | 0 | 0 |
| Comprehensive income for the period | 589 | 343 |
| 2020 | 2019 | |
|---|---|---|
| Amounts in SEK M | 31 Dec | 31 Dec |
| Receivables from Group companies | 1,654 | 1,627 |
| Other financial fixed assets | 8,035 | 6,778 |
| Total fixed assets | 9,690 | 8,404 |
| Cash and bank balances | 0 | 1 |
| Receivables from Group companies | 13,669 | 11,497 |
| Other current assets | 93 | 58 |
| Total current assets | 13,762 | 11,556 |
| Total assets | 23,453 | 19,961 |
| Equity | 4,227 | 3,821 |
| Untaxed reserves | 30 | 30 |
| Non-current interest-bearing liabilities | 10,673 | 7,868 |
| Liabilities to Group companies | 3,554 | 3,423 |
| Deferred tax liabilities | 4 | 3 |
| Total non-current liabilities | 14,232 | 11,294 |
| Current interest-bearing liabilities | 1,081 | 1,295 |
| Liabilities to Group companies | 3,514 | 3,223 |
| Other current liabilities | 368 | 298 |
| Total current liabilities | 4,964 | 4,815 |
| Total equity, untaxed reserves and liabilities | 23,453 | 19,961 |
At the end of the period, Sagax had 19,807 (14,830) shareholders. Sagax's market capitalisation amounted to SEK 58,412 M (47,812). Sagax has four classes of shares: Class A, B and D common shares, and preference shares. The shares are listed on Nasdaq Stockholm, Large Cap.
A total of 461,863,558 shares were outstanding at the end of the period, of which 2,000,000 were Class B treasury shares.
In June, Sagax completed a private placement of 18,000,000 Class D common shares. Moreover, 288,119 Class B common shares were issued due to the exercise of warrants under the 2017/2020 Incentive Plan. In total, the issues generated equity of SEK 532 M for the company.
According to the Articles of Association, each preference share confers a preferential right to SEK 2.00 in annual dividends. Class D shares are entitled to five times the total dividend on Class A and B shares, although not more than SEK 2.00 per share annually.
Sagax has three warrant plans for the company's employees. In total, Sagax's employees hold warrants corresponding to 0.6% of the number of Class A and B shares outstanding. The company's CEO and Board Members do not participate in the plans. These plans are valid for three years, and encompass the
periods 2018-2021, 2019-2022 and 2020-2023. The subscription price corresponds to the price paid for the Class B share at the start of the warrant plan, converted using the average share price trend for the listed property companies in accordance with Carnegie's property index (CREX) during the corresponding period. Accordingly, the warrants will have a value on condition that the price performance of the Sagax share exceeds the average for the listed property companies during each three-year period.
Profit from property management per Class B share after dilution on a rolling 12-month basis amounted to SEK 6.62 (5.51), which, compared with the share price of the Class B share at the end of the period, corresponded to a multiple of 25.5 (24.7).
Equity per Class A and B share after dilution amounted to SEK 55.09 (46.78). Net asset value per Class A and B share amounted to SEK 66.38 (56.77). The share price for the Class B share at the end of the period was 307% (292) of equity per Class B share and 255% (240) of net asset value per Class B share.
| Price paid, SEK | Turnover rate on an annual basis, % |
Average trading volume per trading day, SEK M |
|||||
|---|---|---|---|---|---|---|---|
| 31 Dec 2020 | 31 Dec 2019 | Jan-Dec 2020 | Jan-Dec 2019 | Jan-Dec 2020 | Jan-Dec 2019 | ||
| Class A shares | 168.50 | 139.00 | 4 | 3 | 0.5 | 0.4 | |
| Class B shares | 169.60 | 136.20 | 22 | 9 | 33.4 | 9.5 | |
| Class D shares | 32.05 | 36.35 | 58 | 62 | 8.3 | 9.3 | |
| Preference shares | 35.70 | 38.40 | 30 | 36 | 0.7 | 0.9 |
| 2020 31 Dec |
2019 31 Dec |
2018 31 Dec |
2017 31 Dec |
2016 31 Dec |
2015 31 Dec |
|
|---|---|---|---|---|---|---|
| Share price at the end of period, SEK | 169.60 | 136.20 | 64.70 | 49.10 | 40.87 | 35.87 |
| Profit from property management after dilution, SEK | 6.62 | 5.51 | 4.30 | 3.70 | 2.98 | 2.45 |
| Cash flow after dilution, SEK1) | 6.09 | 4.86 | 3.94 | 3.26 | 2.56 | 2.00 |
| Equity after dilution, SEK | 55.11 | 46.78 | 35.67 | 27.13 | 19.57 | 12.96 |
| Net asset value, SEK | 66.38 | 56.77 | 44.22 | 35.04 | 26.89 | 17.76 |
| Share price/Profit from property management, multiple | 25.6 | 24.7 | 15.0 | 13.3 | 13.7 | 14.6 |
| Share price/Cash flow, multiple1) | 27.9 | 28.0 | 16.4 | 15.1 | 16.0 | 18.0 |
| Share price/Equity, % | 308 | 292 | 182 | 181 | 209 | 277 |
| Share price/Net asset value, % | 255 | 240 | 147 | 140 | 152 | 202 |
1) Cash flow pertains to cash flow from operating activities before changes in working capital.
Share prince/profit from property management per Class B share, rolling 12 months 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 0
| No. of shares | No. of shareholders |
Shareholder category |
No. of share holders |
Share of voting power |
Shareholders by country |
No. of share holders |
Share of voting power |
|---|---|---|---|---|---|---|---|
| 1–500 | 12,955 | Private individuals | Sweden | 18,618 | 89% | ||
| 501–1,000 | 1,799 | residing in Sweden | 17,825 | 9% | Switzerland | 19 | 3% |
| 1,001–2,000 | 1,424 | Private individuals | |||||
| 2,001–5,000 | 1,538 | residing abroad | 113 | 0% | USA | 35 | 2% |
| 5,001–10,000 | 759 | Companies/institutions in Sweden |
793 | 80% | Ireland | 33 | 1% |
| 10,001–50,000 | 912 | Companies/institutions | UK | 61 | 1% | ||
| 50,001– | 420 | abroad | 1,076 | 11% | Other | 1,041 | 4% |
| Total | 19,807 | Total | 19,807 | 100% | Total | 19,807 | 100% |
| No. of shares | Percentage of | |||||
|---|---|---|---|---|---|---|
| Class A shares |
Class B shares |
Class D shares |
Preference shares |
Share capital |
Votes2) | |
| David Mindus and companies | 10,648,800 | 68,865,112 | 1,192,228 | 775 | 17.5% | 25.2% |
| Staffan Salén and companies | 4,264,928 | 34,970,660 | 95,600 | – | 8.5% | 11.1% |
| Rutger Arnhult and companies | 5,778,141 | 24,836,508 | 6,652,150 | – | 8.1% | 12.7% |
| Fourth Swedish National Pension Fund | 5,716 | 17,882,616 | 12,821,678 | – | 6.6% | 4.4% |
| Third Swedish National Pension Fund | – | 24,227,658 | – | – | 5.2% | 3.5% |
| SEB Fonder | – | 15,327,139 | 139,000 | – | 3.3% | 2.2% |
| Avanza Pension | 45,330 | 953,171 | 11,726,480 | 1,359,742 | 3.0% | 2.1% |
| Länsförsäkringar Fonder | – | 13,340,935 | – | – | 2.9% | 1.9% |
| Swedbank Robur Fonder | 500,000 | 8,959,127 | – | – | 2.0% | 2.0% |
| ODIN Fonder | – | 8,366,052 | – | – | 1.8% | 1.2% |
| Erik Selin and companies | 1,160,000 | 4,480,000 | 2,028,868 | – | 1.7% | 2.6% |
| Johan Thorell and companies | 203,254 | 6,949,125 | – | – | 1.5% | 1.3% |
| Filip Engelbert and companies | 241,000 | 2,119,784 | 4,200,000 | – | 1.4% | 1.2% |
| Handelsbanken Fonder | – | 6,234,678 | – | – | 1.3% | 0.9% |
| Second Swedish National Pension Fund | – | 5,219,916 | – | – | 1.1% | 0.7% |
| Didner & Gerge Fonder | – | 4,660,376 | – | – | 1.0% | 0.7% |
| ICA-Handlarnas Förbund | – | – | 4,400,000 | – | 1.0% | 0.6% |
| Patrik Brummer and companies | – | – | 166,666 | 3,440,000 | 0.8% | 0.5% |
| Vanguard | – | – | 3,056,555 | 508,217 | 0.8% | 0.5% |
| Lars Ingvarsson and companies | – | 3,346,410 | 100,000 | – | 0.7% | 0.5% |
| Total 20 largest shareholders | 22,847,169 250,739,267 | 46,579,225 | 5,308,734 | 70.5% | 75.7% | |
| Other shareholders | 3,985,715 | 39,707,379 | 79,220,775 | 11,475,294 | 29.1% | 24.3% |
| Sub-total | 26,832,884 290,446,646 | 125,800,000 | 16,784,028 | 99.6% | 100.0% | |
| Shares held by AB Sagax | – | 2,000,000 | – | – | 0.4% | 0.0% |
| Total | 26,832,884 292,446,646 | 125,800,000 | 16,784,028 | 100.0% | 100.0% | |
| – of which, Board and employees | 15,533,388 | 116,872,066 | 5,908,142 | 923 | 29.9% | 39.7% |
1) The ownership structure on 31 December 2020 is based on information from Euroclear Sweden and Modular Finance. 2) Voting rights for treasury shares held by AB Sagax have been excluded.
| Voting rights and proportion of share capital | |||||
|---|---|---|---|---|---|
| Class of share | No. of shareholders |
Voting rights per share |
No. of votes | Proportion of votes |
Proportion of share capital |
| Class A shares | 26,832,884 | 1.0 | 26,832,884 | 38% | 6% |
| Class B shares | 292,446,646 | 0.1 | 29,244,665 | 42% | 63% |
| Class D shares | 125,800,000 | 0.1 | 12,580,000 | 18% | 27% |
| Preference shares | 16,784,028 | 0.1 | 1,678,403 | 2% | 4% |
| Total | 461,863,558 | 70,335,952 | 100% | 100% |
To prepare the accounts based on generally accepted accounting policies, company management must make judgements and assumptions that affect asset and liability items, revenue and expense items recognised in the accounts and other information provided. The actual outcome may differ from these judgements. Sagax is also exposed to various risks that may be of significance to the company's future business, earnings and financial position.
The valuation of investment properties can be significantly affected by the judgments and assumptions made by company management. To reduce the risk of incorrect valuations, Sagax has engaged authorised external valuation companies to assess the market value of the majority of the properties as of 31 December 2020. When valuing properties, the constant existence of uncertainties regarding the assumptions made must be taken into account.
Sagax prioritises leasing to tenants with a high credit rating and long-term leases, despite these entailing slightly lower immediate earnings. The intention is to reduce the risk of rent losses and the risk of vacancies.
The geographic distribution of Sagax's property portfolio and the industries of its tenants are highly diversified. Sagax's lease structure of many small leases help reduce the risks of vacancies and rent losses.
Sagax's financial expenses comprise the single largest expense for the Group. To reduce Sagax's exposure to rising interest rates, the Group has a significant number of its interest expenses from fixed-rate loans. To limit interest-rate risk for loans at floating interest rates, interest-rate swaps and interest-rate caps are used. Sagax's funding primarily comprises
equity and interest-bearing liabilities. Sagax endeavours to secure a long, average remaining term of interest-bearing liabilities in a bid to limit its refinancing risk, defined as the risk that refinancing existing debt cannot take place on reasonable terms. The company's long-term funding comprises listed bond loans and bank loans. The complete terms and conditions for the bond loans are available at www.sagax.se.
The amounts in the consolidated balance sheet are partly exposed to exchange-rate fluctuations, particularly for the EUR. Net exposure on 31 December 2020, assets less liabilities in EUR, amounted to SEK 8,496 M (6,205). In accordance with IAS 21, the currency effects for foreign operations and hedge accounting are recognised in Other comprehensive income. Other currency effects are recognised in profit or loss.
The COVID-19 pandemic has resulted in weaker macroeconomic conditions and increased uncertainty. The effect on the company will depend on how quickly and the level at which the economy will stabilise.
Sagax's exposure to particularly vulnerable sectors, such as the hotel, restaurant and tourism sectors, is low. Rental revenue is distributed between 1,813 leases. 80% of revenue was attributable to 1,802 leases, each with a rental value of less than 1% of the company's rental revenue.
Sagax's average rent losses have amounted to less than 0.1% of rental revenue for the past ten years and amounted to 0.02% in 2020. However, the impact of the negative macroeconomic trend on Sagax's tenants is unavoidable.
On 31 December 2020, Sagax's cash and cash equivalents and available credit facilities amounted to SEK 4,367 M, of which SEK 24 M in cash and cash equivalents. Sagax's cash flow from operating activities amounted to SEK 2,219 M.
| Sensitivity analysis for property values | ||||||
|---|---|---|---|---|---|---|
| –20% | –10% | 0% | +10% | +20% | ||
| Value change, SEK M | –7,510 | –3,755 | – | 3,755 | 7,510 | |
| Debt ratio, % | 51 | 47 | 43 | 39 | 37 |
| –10% | –5% | 0% | +5% | +10% | |
|---|---|---|---|---|---|
| Occupancy rate, % Interest coverage |
86 | 90 | 95 | 100 | N/A |
| ratio, % | 514 | 544 | 575 | 605 | N/A |
| Change | Value change, SEK M |
|
|---|---|---|
| Yield requirement | +/– 0.25% points | –979/+1,053 |
| Cost of capital | +/– 0.25% points | –896/+921 |
| Rental revenue | +/– 5% | +1,432/–1,427 |
| Property expenses | +/– 5% | –234/+235 |
In a decision of 7 December 2017 pertaining to the 2015 income year, the Tax Agency denied the group company Firethorne AB deductions for loss carryforwards of SEK 1,166 M. In a ruling on 7 February 2019, the Administrative Court upheld the Tax Agency's decision. Sagax is of the opinion that the Tax Agency's decisions are incorrect and
the companies concerned have appealed the decision. If the Tax Agency's decisions were to be upheld, Sagax estimates that the negative effect recognised in earnings for the Group would be SEK 156 M.
Sagax's other risks are described in the 2019 Annual Report, on pages 46-48.
Sagax's exposure to material risks in the company's operations is presented below.
| Amounts in SEK M | Change | Effect on profit from property management, annual basis |
Effect on profit after tax, annual basis |
Effect on equity |
|---|---|---|---|---|
| Economic occupancy rate | +/– 1% | +/– 28 | +/– 23 | +/– 23 |
| Rental revenue | +/– 1% | +/– 28 | +/– 23 | +/– 23 |
| Property expenses | +/– 1% | +/–5 | +/– 4 | +/– 4 |
| Interest expenses for liabilities in SEK including fixed-income derivatives |
+/– 1% | –29/+11 | –23/+9 | –23/+9 |
| Interest expenses for liabilities in EUR including fixed-income derivatives |
+/– 1% | –7/–8 | –6/–6 | –6/–6 |
| Interest expenses for liabilities in SEK excluding fixed-income derivatives |
+/– 1% | –43/+25 | –34/+20 | –34/+20 |
| Interest expenses for liabilities in EUR excluding fixed-income derivatives |
+/– 1% | –14/+0 | –12/+0 | –12/+0 |
| Change in SEK/EUR exchange rate2) | +/– 10% | +/–135 | +/–105 | +/–850 |
| Changed rent level for contract maturity in 2021 | +/– 10% | +/–9 | +/–7 | +/–7 |
1) Excluding shares in profit of joint ventures and associated companies.
2) Sagax's net exposure to the SEK/EUR exchange rate comprises assets and liabilities recognised in EUR, in addition to revenue and expenses in EUR.
This condensed interim report has been prepared in accordance with International Accounting Standards (IAS) 34 Interim Financial Reporting. The term "IFRS" in this report means application of the International Financial Reporting Standards (IFRS), as adopted by the EU, and the interpretations of the International Financial Reporting Interpretations Committee (IFRIC). The accounting policies and calculation methods are the same as those applied in the 2019 Annual Report and are to be read together with this Annual Report.
There are no amendments to IFRS in 2020 that are deemed to have any material impact on the company's financial statements. The company's segment division was changed as of 1 January 2020. The Madrid & Barcelona segment, which was previously reported under Rest of Europe, is reported separately. Comparative figures have been adjusted to include this.
Sagax's shares of profit in the associated companies NP3 and Emilshus are based on financial statements as per 31 September 2020. Profit for the full-year was calculated by assuming that the profit for the fourth quarter is the same as in the third quarter. It is assumed that gains/losses from changes in value were unchanged since the preceding quarter.
Rounding-off differences may occur.
On 3 February 2021, Sagax announced that the Board intends to convene an Extraordinary General Meeting to be held on 19 March 2021. The Meeting will resolve on a reduction of share capital through the compulsory redemption of all 16,784,028 preference shares in accordance with Article 5.6 of Sagax's Articles of Association. Redemption of the preference shares is proposed to take place following the distribution of a dividend of SEK 0.50 per preference share on 7 April 2021. For further information refer to the press release, Press release, 3 February 2021.
In January 2021, Sagax issued an unsecured bond of EUR 400 M in the European capital market as part of its EMTN programme. The bond loan extends to 26 January 2028. The fixed interest coupon amounts to 0.75%. The bond will be used to refinance existing liabilities and the company's operating activities. For further information refer to the press release, Press release, 19 January 2021.
The Board of Directors and CEO give their assurance that this interim report provides a fair overview of the company's and the Group's operations, financial position and earnings and describes significant risks and uncertainties faced by the company and the companies included in the Group.
Stockholm, 8 February 2021 AB SAGAX (publ) Corporate Registration Number 556520-0028
Staffan Salén Johan Cederlund Filip Engelbert Chairman of the Board Board member Board member
David Mindus Johan Thorell Ulrika Werdelin CEO and Board member Board member Board member
This year-end report has not been reviewed by the company's auditors.
This constitutes information that AB Sagax (publ) is legally obliged to publish under the EU's Market Abuse Regulation. The information was released for publication on 8 February 2021 at 5:40 p.m. CET.
| Interim Report January-March 2021 Annual General Meeting 2020 |
5 May 2021 5 May 2021 |
|---|---|
| Interim Report January-June 2021 | 15 July 2021 |
| Interim Report January-September 2021 | 28 October 2021 |
| ■ Final day for trading including dividend rights | 29 March 2021 |
|---|---|
| ■ First day for trading excluding dividend rights | 30 March 2021 |
| ■ Record date for dividend payment | 31 March 2021 |
| ■ Expected payment date by Euroclear2) | 7 April 2021 |
| June 20211) | |
| ■ Final day for trading including dividend rights | 28 June 2021 |
| ■ First day for trading excluding dividend rights | 29 June 2021 |
| ■ Record date for dividend payment | 30 June 2021 |
| ■ Expected payment date by Euroclear2) | 5 July 2021 |
| September 20211) | |
| ■ Final day for trading including dividend rights | 28 September 2021 |
| ■ First day for trading excluding dividend rights | 29 September 2021 |
| ■ Record date for dividend payment | 30 September 2021 |
| ■ Expected payment date by Euroclear2) | 5 October 2021 |
| December 20211) | |
| ■ Final day for trading including dividend rights | 28 December 2021 |
| ■ First day for trading excluding dividend rights | 29 December 2021 |
| ■ Record date for dividend payment | 30 December 2021 |
| ■ Expected payment date by Euroclear2) | 5 January 2022 |
1) As proposed by the board.
2) Payment is made on the third banking day following the record date for Swedish issuers. Sagax is unable to affect this date.
David Mindus, CEO +46 8 545 83 540, [email protected]
Agneta Segerhammar, CFO +46 8 545 83 540, [email protected]
Visit us at www.sagax.se.
Sagax applies the European Securities and Market Authority's (ESMA) Guidelines on the Alternative Performance Measures. Alternative performance measures refer to financial measures of historical or future earnings trends, financial position, financial results or cash flows that are not defined or stated in the applicable rules for financial reporting, which in Sagax's case is IFRS. The basis of the alternative performance measures provided is that they are used by company management to assess the financial performance and thus are considered to provide valuable information to shareholders and other stakeholders.
The table below presents definitions of Sagax's key performance indicators. The calculation of alternative performance measures is described separately on the following pages.
| Key performance indicators | Description | Reason for alternative performance measure |
|---|---|---|
| Cash flow per Class A and B share |
Profit before tax adjusted for items not included in cash flow less tax paid in relation to the average number of Class A and B shares. Dividends on Class D shares and preference shares for the period have also been deducted from profit before tax. Dividends received from joint ventures and associated companies have been added to profit before tax. |
The key performance indicator shows the amount of cash flow for the period that can be considered to be attributable to owners of Class A and Class B shares. |
| Debt ratio | Interest-bearing liabilities at the end of the period as a percentage of total assets at the end of the period. |
The key performance indicator shows financial risk. |
| Dilution | Dilution due to outstanding warrants has been calculated, in line with IAS 33, as the number of Class A and B shares to be issued to cover the difference between the strike price and market price for all potential Class A and B shares (warrants) outstanding, insofar as it is probable that they will be utilised. |
Not an alternative performance measure. |
| Earnings per Class A and B share |
Profit in relation to the average number of Class A and B shares after taking into account the portion of profit for the period represented by dividends on Class D shares and preference shares. |
IFRS performance measure. |
| Earnings per Class D share | Class D shares are entitled to five times the total dividend on Class A and B shares, although not more than SEK 2.00 per share annually. |
The key performance indicator shows the shareholders' share of profit. |
| Earnings per preference share | Each preference share entails a preferential right to SEK 2.00 in annual dividends. |
The key performance indicator shows the preference shareholders' share of profit. |
| EBITDA | Net operating income less central administration costs plus dividends received from joint ventures and associated companies. |
Sagax uses EBITDA so that the EBITDA/Net debt key performance indicator shows financial risk. |
| Economic occupancy rate | Contractual annual rent directly after the end of the period as a per centage of rental value directly after the end of the period. |
The key performance indicator shows the economic degree of utilisation of the Group's properties. |
| Equity/assets ratio | Equity in relation to total assets. | The key performance indicator shows financial risk. |
| Equity per Class A and B share Equity at the end of the period in relation to the number of Class A and B shares at the end of the period after taking into account equity attributable to Class D shares and preference shares. |
The key performance indicator shows the owner's share of equity. |
|
| Equity per Class D share | Equity at the end of the period in relation to the number of common shares at the end of the period after taking into account equity attrib utable to preference shares. Equity is restricted to SEK 35.00 per Class D share. |
The key performance indicator shows the owner's share of equity. |
| Equity per preference share | Equity per preference share corresponds to the preferential right of the preference share on liquidation of the company (SEK 30 per preference share) and the share's accumulated preferential right to dividends (SEK 2 per year). |
The key performance indicator shows the owner's share of equity. |
| EURIBOR | EURIBOR, or the Euro Interbank Offered Rate, is a daily reference rate based on the average of the interest rates at which euro interbank term deposits are being offered by one prime bank to another within the EMU zone. |
Not an alternative performance measure. |
| Fixed-income derivatives | Agreements on lending rates that may include the factors of time, inflation and/or maximum interest rates. Usually signed to hedge interest rates for interest-bearing loans. |
Not an alternative performance measure. |
| IFRS | International Financial Reporting Standards. International Financial Report ing Standards (IFRS), to be applied for consolidated financial statements by companies whose securities are listed on a regulated market. |
Not an alternative performance measure. |
| Interest-rate swaps | An agreement between two parties to swap interest rate conditions on loans in the same currency. The swap entails that one party exchanges its floating interest rate for a fixed rate, while the other party receives a fixed rate in exchange for a floating rate. The purpose of an inter est-rate swap is to reduce interest-rate risk. |
Not an alternative performance measure. |
| Key performance indicators | Description | Reason for alternative performance measure |
|---|---|---|
| Interest coverage ratio | Profit from property management, excluding profit from joint ven tures and associated companies but including dividends from joint ventures, after reversal of financial expenses in relation to financial expenses. |
The key performance indicator shows financial risk. |
| Interest coverage ratio, EMTN programme |
Profit from property management after reversal of financial income and expenses as a percentage of net financial items. |
The key performance indicator shows financial risk. |
| Joint ventures | Partnership form whereby several owners have a shared controlling influence. |
Not an alternative performance measure. |
| Net asset value | Recognised equity according to the balance sheet with reversal of reserves for fixed-income derivatives, deferred tax on temporary differences on property values and deferred tax on reserves for fixed-income derivatives. |
An established indicator of the Group's net asset value that facilitates analyses and comparisons. |
| Net debt | Interest-bearing liabilities less interest-bearing assets, cash and cash equivalents, and listed shares. |
The key performance indicator shows the Group's indebtedness. |
| Net debt according to EMTN programme |
Interest-bearing liabilities less listed securities and cash and cash equivalents. |
The key performance indicator shows the Group's indebtedness. |
| Net debt according to EMTN programme/Total assets |
Interest-bearing liabilities less listed securities and cash and cash equivalents in relation to total assets. |
The key performance indicator shows financial risk. |
| Net debt/Total assets | Interest-bearing liabilities less interest-bearing assets, cash and cash equivalents, and listed shares as a percentage of total assets. |
The key performance indicator shows financial risk. |
| Occupancy rate by area | Contracted area directly after the end of the period as a percentage of total lettable area directly after the end of the period. |
The key performance indicator shows the occupancy situation. |
| Preference equity | Equity per preference share multiplied by the number of preference shares outstanding. |
The key performance indicator shows equity attributable to preference shareholders. |
| Profit from property management per Class A and B share after dilution |
Profit from property management for the period reduced by dividends on Class D shares and preference shares, divided by the average number of Class A and B shares after dilution. |
An indicator of the earnings generation of the assets, excluding the changes in value accruing to holders of Class A and B shares. |
| Profit from property management |
Profit excluding changes in value and tax. | An indicator of the earnings generation in the opera tions, excluding changes in value. |
| Property | Pertains to properties held under title or site leasehold. | Not an alternative performance measure. |
| Return on equity | Profit for the period, recalculated to 12 months, as a percentage of average equity (opening and closing balances)/2 for the period. |
The key performance indicator shows how share holders' capital yields interest during the period. |
| Return on total capital | Profit for the period, recalculated to 12 months, after net financial items after reversal of financial expenses as a percentage of average total assets for the period. |
The key performance indicator shows the ability to generate earnings on the Group's assets, excluding financing costs. |
| Run rate EBITDA | Net operating income according to current earnings capacity less central administration costs plus dividends received from joint ventures and associated companies. |
Sagax uses EBITDA so that the EBITDA/Net debt, run rate key performance indicator shows financial risk. |
| Run rate yield | Net operating income (including property administration) according to current earnings capacity with add-back of site leasehold fees, as a percentage of the carrying amounts of the properties at the end of the period. |
The key performance indicator shows the earn ings generation of the operations before financial expenses and central administration costs are taken into account. |
| Rental value | The contractual annual rent applicable directly after the end of the period, with supplements for estimated market rents for vacant premises. |
The key performance indicator shows the Group's income potential. |
| STIBOR | STIBOR, or Stockholm Interbank Offered Rate, a daily reference rate based on the average of the interest rates at which banks offer to lend unsecured funds to other banks in SEK in the Swedish whole sale money market. |
Not an alternative performance measure. |
| Secured liabilities/total assets | Liabilities secured with pledged assets as a percentage of total assets. |
The key performance indicator shows financial risk for bond holders. |
| Surplus ratio | Net operating income for the period as a percentage of rental revenue for the period. |
The key performance indicator shows the profitability of the properties. |
| Total return on shares | Total of the change in the share price during the period and the dividend paid during the period as a percentage of the share price at the end of the preceding year. |
The key performance indicator shows the total return that accrues to shareholders. |
| Total yield on property | Total of yield and property revaluations during the period as a percentage of the closing property value adjusted for revaluations for the period. |
The key performance indicator shows earnings generation and value growth for the properties for a period. |
| Triple net lease | A type of lease whereby the tenant pays, in addition to the rent, all costs incurred on the property that would normally have been paid by the property owner. These include operating expenses, maintenance, property tax, site leasehold fees, insurance, property care-taking, etc. |
Not an alternative performance measure. |
| Yield | Net operating income for the period (including property administra tion) with add-back of site leasehold fees, recalculated to 12 months, adjusted for the holding periods of the properties during the period as a percentage of the carrying amounts of the properties at the end of the period. |
The key performance indicator shows the earn ings generation of the operations before financial expenses and central administration costs are taken into account. |
| Amounts in SEK M unless otherwise stated |
2020 Jan-Dec |
2019 Jan-Dec |
|---|---|---|
| Return on equity | ||
| Profit after tax | 3,711 | 4,111 |
| Addition for translation to annual value | – | – |
| Average equity | 20,855 | 17,337 |
| Return on equity | 18% | 24% |
| Return on total capital | ||
| Profit from property management | 2,389 | 2,001 |
| Addition for translation to annual value | – | – |
| Financial expenses | 481 | 470 |
| Addition for translation to annual value | – | – |
| Profit before financial expenses | 2,870 | 2,471 |
| Average total capital | 43,388 | 36,922 |
| Return on total capital | 7% | 7% |
| Occupancy rate by area | ||
| Contracted area, 000s of square metres | 3,312 | 2,868 |
| Total lettable area, 000s of square metres | 3,480 | 3,022 |
| Occupancy rate by area | 95% | 95% |
| Debt ratio | ||
| Interest-bearing liabilities | 19,904 | 17,519 |
| Total assets | 46,622 | 40,154 |
| Debt ratio | 43% | 44% |
| Yield | ||
| Net operating income | 2,397 | 2,133 |
| Add-back of site leasehold fees | –25 | –24 |
| Addition for translation to annual value | – | – |
| Holding adjustment, | ||
| acquisitions/divestments Currency translation to closing rate |
57 –67 |
10 –19 |
| Adjusted net operating income | 2,362 | 2,100 |
| Carrying amount of properties | 37,548 | 32,625 |
| Yield | 6.3% | 6.4% |
| EBITDA rolling 12 months | ||
| Net operating income | 2,397 | 2,133 |
| Central administration Dividends from joint ventures and |
–132 | –122 |
| associated companies | 424 | 281 |
| EBITDA | 2,689 | 2,292 |
| Equity per Class A and B share | ||
| Equity | 22,452 | 19,257 |
| Equity attributable to preference and Class D shares |
–4,940 | –4,310 |
| Corrected equity attributable to Class A and B shares |
17,512 | 14,947 |
| No. of shares | 317,279,530 | 316,991,411 |
| No. of shares after dilution | 317,891,458 | 317,506,353 |
| Equity per Class A and B share, SEK | 55.19 | 46.86 |
| Equity per Class A and B share after | ||
| dilution, SEK | 55.09 | 46.78 |
| Amounts in SEK M unless otherwise stated |
2020 Jan-Dec |
2019 Jan-Dec |
|---|---|---|
| Economic occupancy rate | ||
| Contractual annual rent | 2,865 | 2,600 |
| Rental value | 3,024 | 2,735 |
| Economic occupancy rate | 95% | 95% |
| Run rate yield | ||
| Net operating income according to current | ||
| earnings capacity | 2,370 | 2,134 |
| Add-back of site leasehold fees | –25 | –22 |
| Adjusted net operating income | 2,345 | 2,112 |
| Carrying amount of properties Run rate yield |
37,548 6.2% |
32,625 6.5% |
| Run rate EBITDA | ||
| Net operating income according to current | ||
| earnings capacity | 2,370 | 2,134 |
| Central administration | –132 | –122 |
| Dividends from joint ventures and associated companies |
424 | 281 |
| Run rate EBITDA | 2,662 | 2,292 |
| Profit from property management | ||
| Profit after tax | 3,711 | 4,111 |
| Tax | 891 | 730 |
| Changes in value Profit from property management |
–2,213 2,389 |
–2,840 2,001 |
| Profit from property management per Class A and B share after dilution |
||
| Profit from property management | 2,389 | 2,001 |
| Dividends attributable to preference and Class D shares |
–285 | –249 |
| Adjusted profit from property | ||
| management | 2,104 | 1,752 |
| Profit from property management per Class A and B share after dilution, SEK |
6.62 | 5.51 |
| Cash flow per Class A and B share | ||
| Profit before tax | 4,330 | 4,627 |
| Items not affecting cash flow | –2,055 | –2,758 |
| Tax paid | –55 | –74 |
| Dividends attributable to preference and Class D shares |
–285 | –249 |
| Cash flow | 1,935 | 1,546 |
| Cash flow per Class A | ||
| and B share after dilution, SEK | 6.09 | 4.86 |
| Net debt | ||
| Interest-bearing liabilities | 19,904 | 17,519 |
| Interest-bearing assets | –550 | –511 |
| Cash and cash | ||
| equivalents and listed shares | –2,164 | –1,776 |
| Net debt | 17,190 | 15,232 |
| Amounts in SEK M unless otherwise stated |
2020 Jan-Dec |
2019 Jan-Dec |
|---|---|---|
| Net debt according to EMTN programme | ||
| Interest-bearing liabilities Cash and cash equivalents |
19,904 | 17,519 |
| and listed shares | –2,164 | –1,776 |
| Net debt according to EMTN programme | 17,740 | 15,743 |
| Net debt according to EMTN programme/Total assets | ||
| Net debt according to EMTN programme | 17,740 | 15,743 |
| Total assets | 46,622 | 40,154 |
| Net debt according | ||
| to EMTN programme/Total assets | 38% | 39% |
| Net debt/EBITDA | ||
| Net debt | 17,190 | 15,232 |
| EBITDA rolling 12 months | 2,689 | 2,292 |
| Net debt/EBITDA | 6.4x | 6.6x |
| Net debt/run rate EBITDA | ||
| Net debt | 17,190 | 15,232 |
| EBITDA, run rate | 2,662 | 2,292 |
| Net debt/EBITDA run rate | 6.5x | 6.6x |
| Net debt/Total assets | ||
| Net debt | 17,190 | 15,232 |
| Total assets | 46,622 | 40,154 |
| Net debt/Total assets | 37% | 38% |
| Preference equity | ||
| Equity per preference share, SEK | 32.00 | 32.00 |
| Number of preference shares outstanding | 16,784,028 | 16,784,028 |
| Preference equity | 537 | 537 |
| Earnings per Class A and B share1) | ||
| Profit after tax | 3,711 | 4,111 |
| Dividends attributable to preference and | ||
| Class D shares | –285 | –249 |
| Adjusted profit after tax | 3,426 | 3,862 |
| Earnings per Class A and | ||
| B share after dilution, SEK | 10.78 | 12.13 |
| Interest-bearing liabilities | ||
| Non-current interest-bearing liabilities | 17,977 | 16,052 |
| Commercial paper | 1,081 | 1,192 |
| Other current interest-bearing liabilities | 770 | 193 |
| Reversal of allocated | ||
| borrowing costs | 76 | 82 |
| Interest-bearing liabilities | 19,904 | 17,519 |
| Amounts in SEK M unless otherwise stated |
2020 Jan-Dec |
2019 Jan-Dec |
|---|---|---|
| Interest coverage ratio | ||
| Profit from property management | 2,389 | 2,001 |
| Reversal of profit from property management joint ventures and associated companies |
–565 | –441 |
| Dividend from joint ventures and associated companies |
424 | 281 |
| Financial expenses | 481 | 470 |
| Corrected profit from property management before financial expenses |
2,729 | 2,311 |
| Interest coverage ratio | 5.7x | 4.9x |
| Interest coverage ratio, EMTN programme | ||
| Profit from property management | 2,389 | 2,001 |
| Net financial items | 442 | 470 |
| Profit from property management before net financial items |
2,831 | 2,471 |
| Interest coverage ratio | 6.4x | 5.3x |
| Equity/assets ratio | ||
| Equity | 22,452 | 19,257 |
| Total assets | 46,622 | 40,154 |
| Equity/assets ratio | 48% | 48% |
| Net asset value | ||
| Equity | 22,452 | 19,257 |
| Equity attributable to preference and Class D shares |
–4,940 | –4,310 |
| Reversal of derivatives | 118 | 119 |
| Reversal of deferred tax, temporary differences |
2,590 | 2,333 |
| Reversals due to joint ventures | 881 | 741 |
| Net asset value | 21,101 | 18,140 |
| Net asset value per Class A and B share after dilution, SEK |
66.38 | 56.77 |
| Secured liabilities/total assets | ||
| Secured liabilities | 5,086 | 5,449 |
| Total assets | 46,622 | 40,154 |
| Secured liabilities/total assets | 11% | 14% |
| Surplus ratio | ||
| Net operating income | 2,397 | 2,133 |
| Rental revenue | 2,898 | 2,581 |
| Surplus ratio | 83% | 83% |
1) IFRS performance measure.
AB Sagax is a property company whose business concept is to invest in commercial properties, primarily in the warehouse and light industry segment. Sagax's property holdings on 31 December 2020 amounted to 3,480,000 square metres, distributed between 673 properties. AB Sagax (publ) is listed on Nasdaq Stockholm, Large Cap. More information is available at www.sagax.se.
AB Sagax (publ), Engelbrektsplan 1, SE-114 34 Stockholm, Sweden Corp. Reg. No. 556520-0028 Tel: +46 8 545 83 540 www.sagax.se
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