AI Terminal

MODULE: AI_ANALYST
Interactive Q&A, Risk Assessment, Summarization
MODULE: DATA_EXTRACT
Excel Export, XBRL Parsing, Table Digitization
MODULE: PEER_COMP
Sector Benchmarking, Sentiment Analysis
SYSTEM ACCESS LOCKED
Authenticate / Register Log In

Platzer Fastigheter Holding

Interim / Quarterly Report Apr 28, 2016

2955_10-q_2016-04-28_4044ba57-5f98-48c9-8a9e-b5185eaa21d4.pdf

Interim / Quarterly Report

Open in Viewer

Opens in native device viewer

Interim report 1 January - 31 March 2016

  • Rental income increased to SEK 157 million (139)
  • Income from property management improved by 14% to SEK 67 million
  • Profit for the period amounted to SEK 15 million (39)
  • Property portfolio increased in value to SEK 9,924 million (9,784)
  • Net asset value per share was SEK 39.81 (38.62)
  • Earnings per share amounted to SEK 0.14 (0.41)
  • A favourable detailed planning decision by the Building Committee, giving the green light for Phase 1, which comprises future building rights for 120,000 sq m in Södra Änggården

PLATZER IN BRIEF

Platzer is one of the largest, as well as one of the leading, commercial property companies in Gothenburg, primarily in office property. The company owns and develops 58 properties with a total area of approximately 465,000 sq m. Platzer creates growth and profitability through letting and management, property projects and urban development, as well as acquisitions and disposals of properties. Platzer prioritizes good relationships with tenants and offers a service that focuses on close relationships and commitment. At the end of the period, Platzer had 59 employees.

Business concept

Platzer creates value by owning and developing properties in the Gothenburg area.

Vision

Platzer is to be the leading property company in commercial premises in the Gothenburg area.

Core values

  • Freedom with responsibility
  • Long-term development
  • Openness

Financial targets

  • Net asset value per share: SEK 40 (2017)
  • Return on equity:
  • Risk-free interest + 5 percentage points *)
  • Equity ratio: > 30%
  • •Loan-to-value ratio: 65%

See key performance indicators, page 12, and key performance indicators per share, page 23, for outcome.

*) risk-free interest = interest rate for a 5-year Swedish government bond

CALENDAR

Strategy

• Grow and be the leading player in the Gothenburg area, focusing on selected segments.

• Develop long-term relationships on a commercial, sustainable and ethical basis by actively working with customers and suppliers.

• Conduct continuous improvements of the property portfolio through value generating property and project development.

• Debt financing of business based on the value of properties. Use existing cash for value-generating property investments.

Sustainability

Sustainability is about continually taking decisions that facilitate long-term, sustainable development. This is achieved by reaching a balance between several factors -a healthy financial position, satisfied employees, minimal environmental impact and a positive contribution to society. At Platzer, sustainability is an integral part of operating activities and applies to economic, ecological and social sustainability. The company takes a systematic approach to day-today environmental performance and Platzer has held ISO 14001 certification since 2009.

Annual General Meeting 2016 28 April 2016 at 12:00 Interim Report January-June 2016 8 July 2016 at 08:00 Interim Report January-September 2016 27 October 2016

For further information, please visit platzer.se or contact P-G Persson, CEO, +46 (0)734 11 12 22 / Lennart Ekelund, CFO, +46 (0)703 98 47 87

A WORD FROM THE CEO

Platzer's operating surplus increased by 12%, while income from property management was up by 14% compared with the same period in the previous year. The increase was due to a larger property portfolio, as well as the fact that some of our development projects currently underway are starting to have an impact on the income statement.

The net asset value per share increased by 17% compared with the same period in the previous year to just under SEK 40/share, which is the result of successful letting activity in our projects in the autumn and the fact that required yields continued to fall. Because of our strategy of increasing our property and project development business. We will continue to own properties in the future in which ongoing projects generate a lower cash flow during the construction phase, and we will also continue to own building rights that do not generate any cash flow at all.

Project business showing healthy growth

With a project portfolio of more than 500,000 sq m, we are focusing our work on ensuring detailed development plans are drawn up for our development areas. In the first quarter of this year we were able to make important progress towards this goal. A detailed planning decision regarding Södra Änggården (northern Högsbo) meant the go-ahead for Phase 1, which comprises future building rights of 120,000 sq m, a large proportion of which will be housing. 600 flats in the area will form part of the City of Gothenburg's BoStad 2021 housing project to celebrate the city's 400th Anniversary, which means planning will be prioritised by the municipality. Planning is underway for an area totalling 50,000 sq m in Gårda and the Almedals fabriker area, and consultations regarding this project took place in the first quarter. In Backaplan and Gamlestaden we are working hard on the urban development project that is expected to result in finished detailed development plans. Very soon we will also begin construction of our high-profile property at Gamlestads torg.

Low transaction volume and tough competition for properties

Property prices in the Gothenburg area have continued to increase since the turn of the year and there is a lot of competition for the handful of properties that are being offered for sale. All in all, this has resulted in a low volume of transactions in the first quarter. Our strategy is

– "Progress in development projects"

to acquire properties with potential adjacent to our prioritised markets, and to sell properties in locations where we are not able to create added value in the long term. In the first quarter we carried out a property transaction involving the sale of a small property in Gårda to Fastighets AB L E Lundberg.

Berättarministeriet is coming to Gothenburg

Since the beginning of the year, Platzer has had a sustainability manager, and in January we carried out our largest single social sustainability effort to date by signing an agreement with the Berättarministeriet non-profit foundation. Their objective is to inspire school children in Years 2-5 in areas with high unemployment to rediscover creative writing in a fun way. Since starting operations in the Stockholm area in 2011, more than 20,000 children have participated in the activities organised by the foundation, and now Platzer is helping the foundation to establish operations in Gothenburg.

Platzer planning further expansion

A lot is happening in the Gothenburg area. There is a strong drive to succeed in both industry and the service sector. The vacancy rates for office space are at a historically low level and there is a huge shortage of housing in the region. Municipalities are actively looking to boost construction of housing and office space. As a local player we have a presence in many of the most interesting development areas in and around Gothenburg. We are resolutely trying to initiate as many detailed development plans as possible, including building rights for both housing and office space, with the aim being to launch as many projects as possible to meet demand for office space. As far as the building rights for housing are concerned, we will either sell these or swap them for interesting commercial development or investment properties. In this way, Platzer is contributing to the development of Gothenburg and safeguarding the company's future growth.

P-G Persson CEO

COMMENTS JAN-MAR 2016

Comparative values for income statement items refer to the corresponding period in the previous year and for balance sheet items as at 31/12/2015.

Results

Income from property management for the period amounted to SEK 67 million (59), an improvement of 14%. The improvement in results was partly due to a larger property portfolio in the first quarter of 2016 compared with the same period in the previous year, and partly to the fact that completed development projects were occupied, while letting in existing properties increased. Changes in the value of properties in the first quarter of the year amounted to SEK 77 million (60), while changes in the value of financial instruments totalled SEK -128 million (-69). Profit after tax for the period amounted to SEK 15 million (39).

Rental income

Rental income for the period increased by 13% and amounted to SEK 157 million (139). The increased income is primarily attributable to a larger property portfolio, new leases and completed development projects. Rental income from existing lease agreements was estimated to amount to SEK 664 million (547) on an annual basis as at 31 March 2016. The economic occupancy rate for the period amounted to 93% (92). Platzer has a number of large projects/ refurbishment projects underway, where lease agreements have been signed and occupancy is scheduled for the coming quarter. During the project phase the impact on both income, results and occupancy rate is negative.

Property costs

In the first 3 months of the year, property costs amounted to SEK -45 m (-39). The increase was largely due to a larger property portfolio, the acquisition of the property Olskroken 18:7 in the second quarter of 2015, and a colder first quarter. Property operating and maintenance costs are subject to seasonal variations and the first quarter was weighed down by large costs compared with the remainder of the year.

Operating surplus

The operating surplus for the period amounted to SEK 112 million (100), equivalent to an increase of 12%.

The surplus ratio was 71% (72), which was

lower than the rolling twelve-month surplus ratio of 74% because of seasonal variations. The investment yield for the properties was 4.6% (4.8). The decrease was primarily due to a large volume of projects, since several ongoing refurbishment projects resulted in loss of rental income, thus lowering the operating surplus, in addition to which the value of properties increases successively over the project phase whereas income is not generated until projects are completed and tenants move in. In addition, a declining yield requirement in the market, which, all else being equal, results in higher property values, means the investment yield goes down.

Central administration

Central administration expenses for the quarter amounted to SEK -11 million (-8). The increase was primarily due to a larger workforce, up to 59 employees at the end of the period from 47 as at 31 March 2015, with the increase being prompted by the larger property portfolio and larger project portfolio. Furthermore, in the second quarter of 2015, the company launched a share incentive plan aimed at senior management, which weighed down results in the period by around SEK 0.6 m (-).

Net financial items

Net financial items for the period amounted to SEK -34 m (-33). Both interest margins and market rates were lower compared with the same period in 2015, and the higher financial cost is entirely due to the slightly larger property portfolio and thus increased borrowings. At the end of the period, the average interest rate, including the effects of signed derivative instruments, amounted to 2.38% (2.70).

Tax

Tax for the period amounted to SEK -1 m (-11). Property disposals, which give rise to realised capital gains/losses, are normally conducted as corporate divestments. This means the gains are exempt from tax, which also had an impact on tax for the period.

Cash flow

Net investments in property in the first quarter amounted to SEK 63 m (88). Investments in existing properties totalled SEK 105 million (88), while sales amounted to SEK 42 m (-). No acquisitions took place in the period (-). The investments were fully financed from the company's cash assets. Cash flow for the period was SEK -43 million (36). At the end of the period, cash and cash equivalents amounted to SEK 184 million (227). In addition to cash and cash equivalents, as at 31 March 2016 the company had unutilised loan commitments of SEK 213 million and an unutilised overdraft facility of SEK 50 million.

Investment properties and changes in the value of properties

Properties were recognised at a fair value of SEK 9,924 million (9,784), which is based on an internal valuation as at 31 March 2016. The properties are valued internally at the end of each quarter, using a ten-year cash flow model for all properties. At each year-end, Platzer also carries out an external valuation of a selected number of properties that constitute a cross-section of the property portfolio, corresponding to around 30% of the total value of the property portfolio, in order to ensure the quality of the internal valuation. The investment properties are valued within level 3 in the IFRS 13 fair value hierarchy.

The internal property valuation for the period showed a change in the value of investment properties of SEK 77 million (60). The majority of the change in value in the period was due to lower yield requirements in the market. The average required yield based on the valuation as at 31 March 2016 was 5.5%, down from 5.7% at end-March in the previous year, when it was 5.7%.

The property Gårda 8:2 was disposed of in the first quarter through a corporate divestment. Investments in existing properties in the period amounted to SEK 105 million (88), with the largest individual investments being the new build project Hårddisken 1, Mölndal and the rebuilding project KvarterETT at Polhemsplatsen (Stampen 4:44).

Equity

Equity for the Group amounted to SEK 3,608 million (3,592) as at 31 March. The equity/ assets ratio amounted to 35% (35). Equity per share as at 31 March 2016 was SEK 37.20 (37.05), while the long-term net asset value, EPRA NAV, amounted to SEK 44.57 (43.16). The net asset value, which is one of Platzer's financial goals, totalled SEK 39.81 (38,62).

Debt financing and changes in the value of derivatives

At end-March, non-current interest bearing liabilities amounted to SEK 5,659 million (5,690), which corresponded to a loan-to-value ratio of 57% (58). Debt financing primarily comprises bank loans secured by mortgages in property. In addition, Platzer is borrowing SEK 300 m through a Green Bond issue via Nya SFF. In the quarter, Platzer repaid loans in connection with the sale of the property Gårda 8:2. The average fixed interest term, including the effect of derivatives contracts, was 3.9 years as at 31 March 2016 (4.0). The average loan term was 1.7 years (1.9).

In order to achieve the desired fixed interest rate structure the company uses interest rate derivatives in the form of interest rate swaps, which are recognised at fair value in the balance sheet, while gains/losses are recognised in the income statement without applying hedge accounting. The market value as at 31 March was SEK -320 million, which corresponded to a change in value of SEK -128 million for the period. The changes in value do not affect cash flow. During the remaining term of the derivatives, the undervalue will be resolved and will reduce financial costs in the income statement by an equivalent amount.

The financial assets and liabilities that are measured at fair value in the Group comprise the derivative instruments and capital redemption policies described above. Both the derivative instruments and the capital

redemption policies are included in Level 2 in the IFRS 13 fair value hierarchy. The fair value of non-current, interest bearing liabilities is equivalent to their carrying value because the discounting effect is not significant when the interest rate on the loans is variable and in line with market rates.

Personnel and organisation

The workforce increased by 5 people during the period and the company had 59 employees at the end of March. Following a restructuring of the organisation as of 1 January 2016, Platzer's property portfolio is now divided into two market segments instead of three. The market segments are Platzer's units with responsibility for daily operation, management and development of properties. The market segments are supported by two specialist units: Project development, which is responsible for project development and project management, and Letting, which supports the letting business. Platzer's Group and staff functions comprise the CEO, business development, finance, accounts, communication, sustainability and HR.

Events after the end of the reporting period

Platzer has concluded an agreement with the University of Gothenburg on acquisition of the leasehold for Lorensberg 62:1, better known as the Student Union Building. The agreed property value is SEK 50 million and completion will take place on 1 June. The University of Gothenburg has signed a lease for the entire building.

Parent company

The parent company does not own any properties of its own, and instead manages certain Group-wide functions regarding management and financing. Parent company revenue is solely derived from invoicing services to Group companies.

Significant risks and uncertainty factors

The property business, as all businesses, is always exposed to risks. Good internal controls and checks performed by external auditors, well-functioning administrative systems and

policies, as well as proven procedures for property valuations are among the methods used by Platzer to manage and reduce risks. The main risks and uncertainty factors that affect Platzer have not changed over the year, and they are described in detail in the Annual Report for 2015 on pages 48-49, 53-54 and 68-69.

Related party transactions

The company's ongoing transactions with related parties are described in the Annual Report for 2015, page 81. There are no significant transactions with related parties apart from these continuing agreements, and this situation did not change in the first quarter.

Accounting principles

Platzer prepares its consolidated financial statements in accordance with IFRS (International Financial Reporting Standards) as adopted by the EU. The same accounting and valuation principles have been applied as in the most recent annual report. New or revised IFRS standards that have come into force in 2016 have not had any material effect on the Group's financial statements. The interim report has been prepared in accordance with IAS 34, Interim Financial Reporting. The parent company applies the Annual Accounts Act and RFR2.

This interim report has not been reviewed by the company's auditors.

Gothenburg, 28/04/2016

Platzer Fastigheter Holding AB (publ)

P-G Persson CEO

CONSOLIDATED INCOME STATEMENT SUMMARY

SEK million 2016
Jan-Mar
2015
Jan-Mar
2015
Jan-Dec
2015/2016
Apr-Mar
Rental income 157 139 589 607
Property costs -45 -39 -152 -158
Operating surplus 112 100 437 449
Central administration -11 -8 -35 -38
Net financial items -34 -33 -136 -137
Income from property management 67 59 266 274
Change in value, investment properties 77 60 510 527
Change in value, financial instruments -128 -69 64 5
Profit before tax 16 50 840 806
Tax on profit for the period -1 -11 -176 -166
Profit for the period 1) 15 39 664 640
Profit for the period attributable to:
Parent company's shareholders 14 39 653 628
Non-controlling interests 1 - 11 12
Earnings per share 2) 0.14 0.41 6.81 6.55

1) There is no other comprehensive income for the Group, and therefore the consolidated profit for the period is the same as the comprehensive income for the period.

2) There is no dilution effect because there are no potential shares. However, the number of outstanding shares will increase by 250,000 when the share saving scheme is completed.

CONSOLIDATED BALANCE SHEET SUMMARY

SEK million 31/03/2016 31/03/2015 31/12/2015
Assets
Investment properties 9,924 8,491 9,784
Other non-current assets 5 6 5
Non-current financial assets 43 37 60
Current assets 102 62 63
Cash and cash equivalents 184 132 227
Total assets 10,258 8,728 10,139
Equity and liabilities
Equity 3,608 3,005 3,592
Deferred tax liability 392 251 399
Non-current interest bearing liabilities 5,659 4,900 5,690
Other non-current liabilities 334 361 224
Current liabilities 265 211 234
Total equity and liabilities 10,258 8,728 10,139
Pledged assets 5,767 5,035 5,798
Contingent liabilities 8 56 55

CONSOLIDAT ED S TAT EMEN T OF CHANGES IN EQUITY SUMMARY

2016 2015 2015
SEK million Jan-Mar Jan-Mar Jan-Dec
Equity attributable to parent company's shareholders
At the beginning of the period 3,548 2,966 2,966
New share issue - - 0
Share buy-back - - 0
Reversal, share saving scheme 1 - 1
Comprehensive income for the period 14 39 653
Dividend - - -72
At end of period 3,563 3,005 3,548
Equity attributable to non-controlling interests
At the beginning of the period 44 - -
Consolidation of subsidiary - - 33
Comprehensive income for the period 1 - 11
At end of period 45 - 44
Total equity 3,608 3,005 3,592

CHANGE IN VALUE OF PROPERTIE

SEK million 2016
Jan-Mar
2015
Jan-Mar
2015
Jan-Dec
Value of properties, opening balance 9,784 8,343 8,343
Investments in existing properties 105 88 359
Property acquisitions - - 745
Property sales -42 - -259
Consolidation of subsidiary - - 86
77 60 510
Value of properties, closing balance 9,924 8,491 9,784

CONSOLIDATED CASH FLOW STATEMENT

SUMMARY

SEK million 2016
Jan-March
2015
Jan-Mar
2015
Jan-Dec
2015/2016
Apr-Mar
Operating activities
Operating surplus 112 100 437 449
Central administration -10 -8 -32 -34
Net financial items -34 -33 -136 -137
Income tax -12 -4 -14 -22
Cash flow from operating activities before changes in
working capital 56 55 255 256
Change in current receivables -8 -10 -30 -28
Change in current liabilities 4 33 68 39
Cash flow from operating activities 52 78 293 267
Investing activities
Investments in existing investment properties -105 -88 -359 -376
Acquisitions of investment properties - - -745 -745
Sales of investment properties 42 - 259 301
Consolidation of subsidiary - - -86 -86
Cash flow from investing activities -63 -88 -931 -906
Financing activities
Change in interest-bearing liabilities -32 46 836 758
Changes in non-current receivables - - -33 -33
Changes in non-current liabilities - - 5 5
Dividend - - -72 -72
Consolidation of subsidiary - - 33 33
Cash flow from financing activities -32 46 769 691
Cash flow for the period -43 36 131 52
Cash and cash equivalents at the beginning of the
period 227 96 96 132
Cash and cash equivalents at end of period 184 132 227 184

INCOME STATEMENT, PARENT COMPANY

SUMMARY

SEK million 2016
Jan-Mar
2015
Jan-Mar
2015
Jan-Dec
Net sales 3 3 12
Operating expenses -4 -3 -12
Net financial items -21 -15 -72
Change in value, financial instruments -128 -24 18
Profit before tax and appropriations -150 -39 -54
Appropriations - - 153
Tax 33 9 -19
Profit for the period 1) -117 -30 80

1) The parent company has no other comprehensive income and total comprehensive income is therefore the same as the profit for the period.

B ALANCE SHEET, PARENT COMPANY

S U M M A R Y

SEK million 31/03/2016 31/03/2015 31/12/2015
Assets
Participations in Group companies 1,053 1,020 1,053
Other non-current financial assets 2,222 1,624 2,203
Receivables from Group companies 1,045 1,085 1,072
Other current assets 23 8 17
Cash and cash equivalents 4 2 8
Total assets 4,347 3,739 4,353
Equity and liabilities
Equity 1,801 1,878 1,917
Untaxed reserves 50 42 50
Non-current liabilities 2,463 1,804 2,352
Current liabilities 33 15 34
Total equity and liabilities 4,347 3,739 4,353
Pledged assets 2,138 1,569 2,138
Contingent liabilities 3,117 3,290 3,149

KEY PERFORMANCE INDICATORS

2016
Jan-Mar
2015
Jan-Mar
2015
Jan-Dec
2015/2016
Apr-Mar
Financial
Debt/equity ratio (multiple) 1.6 1.6 1.6 1.6
Interest coverage ratio (multiple) 2.9 2.7 3.0 3.0
Loan-to-value ratio, % 57 58 58 57
Equity/assets ratio, % 35 34 35 35
Return on equity, % 4.7 5.9 20.0 19.1
Property-related
Investment yield, % 4.6 4.8 4.8 4.9
Surplus ratio, % 71 72 74 74
Economic occupancy rate, % 93 92 91 92
Rental value, SEK/sq m 1,501 1,486 1,532 1,477
Lettable area, sq m (thousand) 463 415 465 463

For definitions of Key Performance Indicators, please see page 24.

SEGMENT REPORTJ A N -M A R 2016

Project
Investment properties
properties
Total
Central
Gothenburg
South/West
Gothenburg
North/East
Gothenburg
SEK million 2016 2015 2016 2015 2016 2015 2016 2015 2016 2015
Rental income 90 83 28 30 38 25 1 1 157 139
Property costs -22 -21 -10 -11 -12 -6 -1 -1 -45 -39
Operating surplus 68 62 18 19 26 19 0 0 112 100
Investment properties, fair
value 6,376 5,682 1,260 1,362 2,104 1,270 184 177 9,924 8,491

In the Group's internal reporting, activities are divided into the segments shown above. The total operating surplus above is the same as the operating surplus reported in the income statement.

The difference between the operating surplus of SEK 112 million (100) and profit before tax of SEK 16 million (50) consists of central administration SEK -11 million (-8), net financial items SEK -34 million (-33) and changes in value of properties and derivatives SEK -51 million (-9).

The property Gårda 8:2, which was part of the Central Gothenburg segment, was sold in the accounting period.

INTEREST BEARING LIABILITIES

Interest
maturity
Loan Average
amount, SEK Share, interest, Loan amount, Share,
%
2,419 43 1.22 1,364 24
- - - 1,948 34
120 2 3.41 1,455 26
200 3 3.20 892 16
300 5 4.14
670 12 2.96
550 10 3.48
100 2 3.48
1,000 18 3.25
300 5 2.49
5,659 100 2.38 5,659 100
million % % Loan maturity
SEK million

QUARTERLY SUMMARY

2016 2015 2015 2015 2015 2014 2014 2014
Ju
Jan Oct Ju Apr Jan Oct ly Apr
SEK million Mar Dec ly-Sept June Mar Dec Sept June
Rental income 157 160 146 144 139 131 133 131
Property costs -45 -44 -35 -34 -39 -34 -33 -28
Operating surplus 112 116 111 110 100 97 100 103
Central administration -11 -11 -8 -8 -8 -10 -7 -8
Net financial items -34 -34 -34 -35 -33 -36 -38 -39
Income from property management 67 71 69 67 59 51 55 56
Change in value, investment properties 77 205 196 49 60 167 126 91
Change in value, financial instruments -128 63 -74 144 -69 -76 -47 -56
Profit before tax 16 339 191 260 50 142 134 91
Tax on profit for the period -1 -66 -42 -57 -11 -34 -29 -20
Profit for the period 15 273 149 203 39 108 105 71
Investment properties 9,924 9,784 9,491 9,192 8,491 8,343 7,363 7,195
Investment yield, % 4.6 4.8 4.8 5.0 4.8 4.9 5.5 5.8
Surplus ratio, % 71 73 76 76 72 74 75 79
Economic occupancy rate, % 93 92 91 90 92 97 92 93
Return on equity, % 4.7 12.3 9.7 11.7 5.9 7.9 8.3 7.4
Equity per share. SEK 37.20 37.05 34.32 32.76 31.39 30.98 29.85 28.75
Net asset value per share, SEK 39.81 38.62 36.40 34.24 34.04 33.07 31.32 29.84
Share price, SEK 44.50 38.00 34.70 34.20 39.00 33.50 30.00 30.10
Earnings after tax per share, SEK 0.14 2.74 1.56 2.12 0.41 1.13 1.10 0.74
Cash flow from operating activities per
share, SEK 0.55 1.22 0.85 0.18 0.82 0.51 0.56 0.39

EARNING CAPACITY

Eco
nomic
Oper
ating
Sur
Lettable Fair Rental occu Rental sur plus
Number of area, value, value, pancy income, plus, ratio,
properties sq m SEK m SEK m rate, % SEK m SEK m %
INVESTMENT PROPERTIES
Central Gothenburg
Offices/Retail 20 187,233 6,076 396 94 373 297 78
Industrial/Warehouses/
Other 2 23,925 300 17 82 14 11 79
Total 22 211,158 6,376 413 94 387 302 78
South/West Gothenburg
Offices/Retail 9 56,647 625 68 85 58 38 66
Industrial/Warehouses/
Other 9 59,177 635 64 95 61 44 72
Total 18 115,824 1,260 132 90 119 82 69
North/East Gothenburg
Offices/Retail 8 133,155 2,104 167 95 158 115 73
Industrial/Warehouses/
Other - - - - - - - -
Total 8 133,155 2,104 167 95 158 115 73
TOTAL
INVESTMENT PROPERTIES 48 460,137 9,740 712 93 664 499 75
PROJECT PROPERTIES 10 3,475 184 1 - - -1
TOTAL PLATZER 58 463,612 9,924 713 93 664 498 75

The summary comprises the property portfolio as at 31 March 2016 and provides a snapshot of the company's earning capacity, and it does not constitute a forecast.

The profit-related columns include valid lease agreements, including for future occupancy over the next six months, if occupancy relates to existing properties. Lease agreements with a later occupancy date or for properties currently under construction are not included. As at this date, in addition to the above table, lease agreements have been signed for ongoing projects with a rental value of SEK 11 million (Hårddisken 1 and Brämaregården 35:4), for occupancy in the third quarter of 2016 onwards.

Rental value refers to rental income plus the estimated market rent of vacant premises in their existing condition. Rental income refers to contracted rental income including agreed supplements, such as payments for heating and property taxes, and excluding limited period discounts of approximately SEK 15 million.

The operating surplus indicates the properties' earning potential on an annual basis defined as contracted rental income as of 1 April 2016, minus the estimated property costs including property management for a rolling 12-month period.

Project properties in the table refer to income from existing properties before project start. This income will cease when the project commences.

R EN TAL AND PROPER T Y MAR KE T

The property market in Gothenburg remained very strong in the first few months of 2016. Yield requirements in the transaction market were low and levels are expected to continue to decline. This is a consequence of high demand in the Gothenburg property market, combined with current interest rate levels. Office properties that have recently suffered the sharpest drops in required yields are modern properties in prime locations with low vacancy rates and stable cash flows. Demand in the transaction market is expected to remain high, since property is generally considered to be a good investment asset, producing good returns at relatively low risk.

The office rental market has continued to see high demand, primarily in city centre locations. For instance, vacancy rates in areas such as Central Business District (CBD), City centre excl. CBD, and Norra Älvstranden are substantially lower than in other parts of the city. The low supply of vacant office space means that letting volume is relatively low, however, despite high demand. The large pressure on premises in central locations has also ensured that rents have shown good growth in recent years. Rents are expected to continue to rise, provided that demand remains high.

In a few years, a large volume of office space will come to market as a number of projects that are now at the planning stage are realised. In the long term this could result in more relocation and better matching of tenants' need for modern premises that make effective use of floor area with the office space property owners are able to supply.

Office space data by geographical area, fourth quarter 2015

Area Prime rents
SEK/sq m/year
Prime yield (required yield,
high-quality asset), %
Central Business District (CBD) 2,800 4.50
City centre excl. CBD 2,600 4.75
Norra Älvstranden 2,200 5.25
Hisingen, other 1,000 5.50
Mölndal 2,000 6.00
West Gothenburg 1,150 6.75
East Gothenburg 1,100 6.00

New production of office space in Gothenburg

Total new production in Gothenburg, sq m Share of total office space, %

Source: JLL

Source: JLL & Platzer's estimates

PROPERTY PORTFOLIO

Platzer owns and develops commercial properties in the Gothenburg area. The properties can be divided into three geographical areas: Central Gothenburg (Centre, Gårda, Krokslätt and Gullbergsvass), South/West Gothenburg (Högsbo, Långedrag and Mölndal) and North/ East Gothenburg (Backaplan, Gamlestaden and Mölnlycke). Platzer aims to be the leading player in all prioritised areas through profitable growth. Today, the company is the leading player in Gullbergsvass, Gårda, Gamlestaden and Högsbo.

Property portfolio

As at 31 March 2016, the property portfolio comprised 58 properties, ten of which were project properties, with a fair value of SEK 9,924 million.

The total lettable area was 463,612 sq m, divided as follows: offices 68%, retail 4%, industrial/ warehouses 13% and other 15%.

The economic occupancy rate during the period was 93% (92).

Rents

Platzer has 689 lease agreements for non-residential premises. The largest tenants include DB Schenker, the Swedish Migration Board, Mölnlycke Health Care, Länsförsäkringar Göteborg & Bohuslän, Nordea Bank AB, Stampen, the Swedish National Courts Administration, the Swedish Social Insurance Agency, Cochlear and the Göteborg Region Association of Local Authorities.

The twenty largest lease agreements accounted for 33% of the rental value. The average remaining maturity was 45 months.

Platzer has also signed leases for new builds and refurbishment projects for occupancy in the period 2016 – 2018.

Apart from lease agreements for non-residential premises, there are parking agreements for indoor and outdoor parking and short-term parking, as well as agreements for advertising signs and masts with a total rental value of SEK 41 million.

Contract structure/Agreements by year of maturity 1)

Number Rental
income, SEK
million
Share
%
2016 123 45 7
2017 210 96 16
2018 167 133 21
2019 115 124 20
2020 35 64 10
2021 24 112 18
2022- 15 49 8
689 623 100
Multi-storey
car parks/ 41
other
Total 664

1) Excluding lease agreements for projects with future occupancy.

PROPERTY TRANSACTIONS

No acquisitions took place in the period.

In the first quarter of this year, Platzer sold the property Gårda 8:2 to Fastighets AB L E Lundberg through a corporate divestment which valued the property at SEK 44 million. The deal gives Lundberg the opportunity to develop an entire block, to the benefit of the area and also Platzer.

Already at the beginning of January 2015, Platzer signed a contract for the sale of Gullbergsvass 703:53 to the City of Gothenburg, with vacation of the property conditional on various issues, such as whether the detailed development plan for the new Hisingsbro Bridge gains legal force. The property is expected to be vacated in 2016. In connection with the sale, Platzer secured the right to acquire future building rights of around 40,000 sq m when the new bridge is completed, probably in 2021.

Sales Lettable
Agreed property area, sq
Quarter Properties Area Segment Vacated value, SEK m m
1 Gårda 8:2 Gårda North/East Gothenburg 01/03/2016 44 1,960
44 1,960

Acquisitions after the end of the reporting period

After the end of the reporting period, Platzer has concluded an agreement with the University of Gothenburg on acquisition of the leasehold for Lorensberg 62:1, better known as the Student Union Building. The property, which has a floor area of around 4,500 sq m, was valued at around SEK 50 million in the deal, and completion will take place on 1 June. The University of Gothenburg has signed a lease for the entire building. Platzer will be cooperating with the University on redevelopment of the property, which will involve part of the property being demolished to make room for student accommodation.

PROPER T Y, PROJEC T AND UR BAN DE VELOPMEN T

Platzer has potential development projects comprising gross floor area (GFA) of around 500,000 sq m, and ongoing projects comprising around 60,000 sq m of lettable area. The projects mainly involve office properties with elements of service, and the mixed use development projects also include residential property. The total project investment is estimated to amount to approximately SEK 12 billion, of which ongoing major projects account for around SEK 800 million. Platzer's strategy is to develop detailed development plans for mixed use development, sell building rights for residential use and focus on developing commercial property.

The project portfolio is divided into two parts, property development and project development. Property development is the development of existing buildings by means of additions, extensions or conversion, and includes everything from minor adjustments for tenants to major projects. Project development involves new construction from the ground up or where previous buildings are demolished to make way for a new construction project.

The occupancy rate for current project development projects is shown in the table on the next page. Gårda 1:15 and Livered 1:329 are both being converted for the Swedish Migration Board, with estimated completion in summer and autumn 2016. Business activities are continuing to take place in the properties while the projects are being implemented. Construction of Hårddisken 1 for Armatec is continuing this year and the project is expected to be completed in the first quarter of 2017. In the second quarter of 2016, construction is expected to start on Gamlestaden 740:132, which is 10% let to Västtrafik.

In addition to the individual development projects listed above and in the table, Platzer is also involved in urban development of entire areas, where Platzer is participating in the development work. The primarily focus is on the areas Backaplan, Södra Änggården, Gamlestaden and Gårda.

With regard to the development of Backaplan, Platzer together with the City Planning Department and four other property owners have worked out a master plan for the area. Work is currently underway on the detailed development plan and it is hoped that the first steps towards redevelopment of the area will be taken in 2017.

As the largest property owner in northern Högsbo, Platzer is the driving force behind the redevelopment of the area into Södra Änggården: a vibrant city district with housing, businesses and small-scale commerce. In March, the Building Committee reached a positive detailed planning decision and commissioned a detailed development plan for mixed use urban development. Phase 1 will comprise 120,000 sq m, of which 75% will be housing, equivalent to around 1,200 flats. 600 of the flats have been allocated to the City of Gothenburg's 400th Anniversary project BoStad 2021, the objective of which is to produce 7,000 new housing units by 2021, in addition to normal housing output. The project is associated with the City's plans to turn the nearby Dag Hammarskjöldsleden highway into a city boulevard.

In the next 10 years, large changes will take place in Gamlestaden, where Platzer's project Gamlestads torg will form the entrance to the district. Construction will start in the second quarter of 2016, and occupancy is anticipated in summer 2018. Adjacent to this project lies Olskroken 18:7, better known as Gamlestadens Fabriker, where work on the detailed development plan is ongoing. In 2015, future building rights for residential use were sold to JM, which is now participating in future development of the area. At Bagaregården 17:26, architecture contest are being prepared for a revised detailed development plan.

Major projects underway

Converted New area,
area, lettable lettable Total inv. Of which
Property Type 1) area,
sq m
area,
sq m
incl. land,
SEK m
outstanding
inv, SEK m
Occupancy rate, % Completed
Stampen 4:44 Proper 14,000 60 20 95 Q2 2016
ty Dev.
Gårda 1:15 Proper 10,000 1,200 110 25 100 Q3 2016
ty Dev.
Livered 1:329 Proper 14,000 65 35 100 Q4 2016
ty Dev.
Hårddisken 1 Project 4,800 85 55 100 Q1 2017
Dev.
Gamlestaden 740:132 Project 16,000 480 420 10 Q2 2018
Dev.
Total 38,000 22,000 800 555

The summary includes potential projects that have been identified for properties that the company owns or has agreed to acquire.

1) Type refers to property development (Property Dev.), which mean existing buildings are used as a base, or project development (Project Dev.), which involves new construction from ground up.

2) Possible construction start means when it is estimated the project could start, provided planning proceeds to plan and leasing has reached a satisfactory level.

Potential development projects

Property Type 1) Type of
property
New floor
area (gross)
sq m
Project phase Possible
construc
tion start 2)
Gårda 4:11 Project Dev. offices 3,000 detailed development
plan available
2016
Gullbergsvass 5:10 Property Dev. offices 4,000 detailed development
plan available
2016
Gårda 2:12 Project Dev. offices 20-25,000 detailed development
plan in progress
2017
Gårda 16:17 Project Dev. offices 15-20,000 detailed development
plan in progress
2017
Bagaregården 17:26 Project Dev. offices 10-15,000 revision of detailed
development plan
2017/2018
Skår 57:14 Project Dev. offices 15-20,000 detailed development
plan in progress
2017/2018
Olskroken 18:7 Project Dev./
Property Dev.
mixed use
development
70-80,000 detailed development
plan in progress
2017/2018
Backaplan (multiple
properties)
Project Dev. mixed use
development
60-90,000 detailed development
plan in progress
2017/2018
Södra Änggården Phase
1(Högsbo, multiple
properties)
Project Dev./
Property Dev.
mixed use
development
120,000 detailed development
plan in progress
2017/2018
Krokslätt 34:13 Property Dev./ Project Dev. mixed use
development
10-15,000 detailed development
plan to commence 2017
2018/2019
Älvsborg 178:9 Property Dev. housing 10-12,000 detailed development
plan to commence 2016
2020
Södra Änggården Phase 2
(Högsbo, multiple
properties)
Total
Project Dev./
Property Dev.
mixed use
development
80-130,000
417,000-534,000
Aiming to apply for
detailed planning decision
in
2016/2017
2020/2021

LIST OF PROPERTIES

Lettable area, sq m
Industrial/ ware-
No. Investment property Address Year of
construction
Offices Retail house Other Total
1 Backa 173:2 Deltavägen 4 1979 151 5,380 420 5,951
2 Balltorp 1:135 Taljegårdsgatan 11 1989 5,515 515 377 6,407
3 Bagaregården 17:26 Gamlestadsvägen 3 / Byfogdegatan 1-3, 11 1941/2010 24,977 365 7,306 2,535 35,183
4 Bosgården 1:71 Södra Ågatan 4 1988 4,687 56 4,743
5 Brämaregården 35:4 Vågmästaregatan 1 1984/1991 12,377 222 855 13,454
6 Forsåker 1:196 Kvarnbygatan 10-14 1955/2002 5,317 150 5,467
7 Fänkålen 2 Johannefredsgatan 4 1990 3,913 45 536 4,494
8 Gullbergsvass 1:1 Lilla Bommen 3 1988 16,003 16,003
9 Gullbergsvass 1:17 Lilla Bommen 8 1993 5,400 5,400
10 Gullbergsvass 5:10 Kämpegatan 3-7 1988 11,736 336 463 12,535
11 Gullbergsvass 5:26 Kilsgatan 4 2010 15,298 1,417 16,715
12 Gullbergsvass 703:53 Hamntorgsgatan 1991 9,000 9,000
13 Gårda 1:15 Vestagatan 2 1971/1992 11,896 11,896
14 Gårda 13:7 Johan Willins gata 5 2003 14,925 14,925
15 Gårda 16:17 Drakegatan 6-10 1986 15,234 278 564 16,076
16 Gårda 3:12 Anders Personsgatan 2-6 1956/2015 3,503 242 3,745
17 Gårda 3:14 Anders Personsgatan 8-10 2015 8,813 95 8,908
18 Gårda 4:11 Anders Personsgatan 14-16 1965/2002 7,468 481 7,949
19 Högsbo 1:4 Olof Asklunds gata 11-19 1980 1,638 1,444 3,082
20 Högsbo 2:1 Olof Asklunds gata 6-10 1991 6,300 6,300
21 Högsbo 3:12 Fältspatsgatan 2-4 1964 2,776 277 6,549 761 10,363
22 Högsbo 3:11 Fältspatsgatan 6 1964 1,802 6,421 20 8,243
23 Högsbo 3:6 Fältspatsgatan 8-12 1964 1,038 5,497 6,535
24 Högsbo 3:9 Olof Asklunds gata 14 1971 2,123 2,210 4,333
25 Högsbo 32:3 J A Wettergrens gata 5 1974 6,381 1,053 570 8,004
26 Högsbo 34:13 Gruvgatan 2 1981 493 1,287 1,780
27 Högsbo 39:1 Ingela Gathenhielms gata 4 1972 3,390 3,390
28 Högsbo 4:1 Fältspatsgatan 1 / A Odhners gata 8 / Olof
Asklunds gata 24
1965/1972 1,310 510 2,823 4,643
29 Högsbo 4:4 Fältspatsgatan 3 1962 2,670 3,718 6,388
30 Högsbo 4:6 A Odhners gata 14 1974 1,349 2,549 3,898
31 Krokslätt 148:13 Mölndalsvägen 40-42 1952 2,581 616 20 3,217
32 Krokslätt 149:10 Mölndalsvägen 36-38 1952/98 6,928 6,928
33 Krokslätt 34:13 Mölndalsvägen 91-93 / Varbergsgatan 2 A-C 1950/88 10,905 725 1,308 375 13,313
34 Livered 1:329 Streteredsvägen 100 1962 13,937 13,937
35 Nordstaden 13:12 Packhusplatsen 6 / N Hamngatan 2 1929/1993 5,070 5,070
36 Nordstaden 14:1 Postgatan 5 / Smedjegatan 2 1993/1995 8,607 8,607
37 Nordstaden 20:5 Packhusplatsen 3 / Kronhusgatan 1A / 1943 2,554 231 2,785
Postgatan 2 A
38 Olskroken 18:7 Gamlestadsvägen 2-4 1729/1960 41,653 102 6,842 13,273 61,870
39 Skår 57:14 Gamla Almedalsvägen 1-51 1929 8,286 119 8,405
40 Solsten 1:110 Företagsvägen 2 1991 1,658 1,089 356 3,103
41 Solsten 1:132 Konstruktionsvägen 14 2002 4,953 4,953
42 Stampen 4:42 Odinsgatan 8-10 / Barnhusgatan 1 2009 5,769 2,847 8,616
43 Stampen 4:44 Polhemsplatsen 5-7 / Odinsgatan 2-4 /
Burggrevegatan 9-11
1930 13,542 13,542
44 Stigberget 34:12 Masthuggstorget 3 1967/1999 4,457 2,801 264 253 7,775
45 Stigberget 34:13 Fjärde Långgatan 46-48 1969 7,246 120 2,382 9,748
46 Tingstadsvassen 3:8 Krokegårdsgatan 5 1991 29 3,966 11 850 4,856
47 Tingstadsvassen 4:3 Motorgatan 2 1943/1986 517 3,268 3,785
48 Älvsborg 178:9 Redegatan 1 1993 9,659 296 3,862 13,817
Total investment properties 314,582 18,130 57,057 70,368 460,137
Project properties Address Year of
construc
tion
Offices Retail Industrial/
warehouse
Other Total
49 Gamlestaden 740:132 Gamlestads torg -
50 Gårda 2:12 Venusgatan 2-6 1959 1,785 1,340 3,125
51 Hårddisken 1 Betagatan, Jolen Södra -
52 Högsbo 2:2 Gruvgatan 1 350 350
53 Högsbo 3:5 Fältspatsgatan 14 -
54 Högsbo 3:13 Fältspatsgatan 2 -
55 Högsbo 33:1 Gruvgatan -
56 Högsbo 757:118 Fältspatsgatan -
57 Högsbo 757:121 Fältspatsgatan -
58 Högsbo 757:122 Fältspatsgatan -
Total project properties 1,785 1,340 - 350 3,475
TOTAL 316,367 19,470 57,057 70,718 463,612

THE SHARE AND SHAREHOLDERS

Platzer Class B shares have been listed on the NASDAQ OMX Stockholm, Mid Cap, since 29 November 2013. In conjunction with the listing, the company carried out a new issue of shares priced at SEK 26.50 each, which raised SEK 651 million net of issue costs. The company's share price as at 31 March 2016 was SEK 44.50 per share, corresponding to a market capitalisation of SEK 4,261 million based on the number of outstanding shares. In the first quarter, a total of 7.1 million shares, worth a total of SEK 276 million, changed hands. Average daily turnover was around 116,000 shares.

Share capital

Platzer's holding of own shares now consists of 250,000 Class B shares. As at 31 December 2016, Platzer's share capital amounted to SEK 9,599,743.40, which was distributed among 20,000,000 Class A shares with 10 votes per share, and 75,997,434 Class B shares carrying one vote per share. Each share has a quotient value of SEK 0.10. Platzer owns 250,000 Class B shares

Dividend policy and dividend

The long-term policy is to pay a dividend of 50% of the income from property management after tax (22% flat-rate tax). The Board of Directors proposes to the Annual General Meeting on 28 April 2016 that a dividend of SEK 1.00 per share be paid (0.75), an increase of 33% compared with the previous year.

Ownership

There were 3,924 shareholders as at 31 March 2016. Foreign ownership amounted to 7% of equity.

Platzer's Articles of Association include a pre-emptive rights clause, which states that a buyer of Class A shares, who did not previously own Class A shares, must offer other holders of Class A shares the right of first refusal, unless this acquisition was through an intra-Group transfer or equivalent within the respective current group of shareholders. If the holders of Class A shares do not take up this right of first refusal, the transferred shares will automatically be converted into B shares before the acquiring party is entered in the shareholders' register.

Information for shareholders

Platzer's primary information channel is platzer. se. All press releases and financial reports are published here. Press releases and reports can be obtained by email in connection with publication. The website also includes presentations, general information about the share, reports on corporate governance, financial data as well as information on insiders and insider transactions.

Share price development

MAJOR SHAREHOLDERS

Major shareholders in Platzer Fastigheter Holding AB (publ) as at 31 March 2016

Owners Number of
Class A shares
Number of
Class B
shares
Number of
shares
Voting
rights, %
Share of
equity,%
Ernström & Co 10,000,000 10,000,000 36.3 10.4
Länsförsäkringar Göteborg och Bohuslän 5,000,000 11,162,490 16,162,490 22.2 16.9
Backahill 5,000,000 5,000,000 18.1 5.2
Family Hielte / Hobohm 19,293,745 19,293,745 7.0 20.2
Länsförsäkringar fondförvaltning AB 9,043,615 9,043,615 3.3 9.5
Fourth Swedish National Pension Fund 6,064,699 6,064,699 2.2 6.3
Carnegie Fonder 5,000,000 5,000,000 1.8 5.2
Lesley Invest (incl. private holdings) 2,771,490 2,771,490 1.0 2.9
Svolder AB 1,960,166 1,960,166 0.7 2.0
Nordea Investment Fund 1,359,811 1,359,811 0.5 1.4
Other shareholders 19,091,418 19,091,418 6.9 20.0
Total number of shares outstanding 20,000,000 75,747,434 95,747,434 100.0 100.0
Buyback of own shares 250,000 250,000
Total number of registered shares 20,000,000 75,997,434 95,997,434

KEY PERFORMANCE INDICATORS PER SHARE

2016
Jan-Mar
2015
Jan-Mar
2015
Jan-Dec
2015/2016
Apr-Mar
Equity, SEK 37.20 31.39 37.05 37.20
Long-term net asset value (EPRA NAV), SEK 44.57 37.40 43.16 44.57
Net asset value, SEK 39.81 34.04 38.62 39.81
Share price, SEK 44.50 39.00 38.00 44.50
Profit after tax, SEK 1) 0.14 0.41 6.81 6.55
Income from property management, SEK 0.70 0.61 2.78 2.87
Cash flow from operating activities, SEK 0.55 0.82 3.07 2.79
Number of shares as at end-March, thousand 95,747 95,747 95,747 95,747
Average number of shares, thousand 95,747 95,747 95,747 95,747

For definitions of key performance indicators, please see page 24.

1) There is no dilution effect, as there are no potential shares..

However, the number of outstanding shares will increase by 250,000 when the share savings scheme is completed.

NET ASSET VALUE PER SHARE

DEFINITIONS

FINANCIAL

Debt/equity ratio

Interest-bearing liabilities divided by equity.

Interest coverage ratio

Profit after financial income divided by interest expenses.

Loan-to-value ratio

Interest-bearing liabilities divided by the value of properties.

Equity/assets ratio

Equity divided by total assets.

Return on equity

Profit after tax as a percentage of average equity, translated into full-year value for interim periods. Attributable to parent company's shareholders.

PROPERTY-RELATED

Investment yield

Operating surplus as a percentage of the average value of the properties, translated into full-year value for interim periods.

Surplus ratio

Operating surplus as a percentage of rental income.

Economic occupancy rate

Rental income as a percentage of rental value, where rental income is defined as rents charged plus supplements for heating and property tax, and rental value is defined as rental income plus estimated market rent (excluding supplements) for vacant areas (in their 'as is' condition).

Rental value, SEK/sq m

Rental value divided by lettable area, where rental value is defined as rental income plus estimated market rent (excluding supplements) for vacant areas (in their 'as is' condition). Translated into full-year value for interim periods.

SHARES

Key performance indicators per share

Equity and net asset value are calculated in terms of the number of outstanding shares on the balance date; other key ratios are calculated in terms of the average number of outstanding shares.

Long-term net asset value (EPRA NAV)

Equity as per the balance sheet including reversals of interest rate derivatives and deferred taxes. Attributable to parent company's shareholders.

Net asset value (NAV)

Equity as per the balance sheet including reversal of interest rate derivatives (after deduction of 22% tax). Attributable to parent company's shareholders.

Profit after tax

Attributable to parent company's shareholders.

P l a t z e r F a s t i g h e t e r H o l d i n g A B ( p u b l ) , B o x 2 11 , S E - 4 0 1 2 3 G O T H E N B U R G Office Address: Anders Personsgatan 16 Tel. +46 (0)31 63 12 00, Fax +46 (0)31 63 12 01 [email protected] platzer.se Registered office of Board of Directors: Gothenburg Corp. ID No: 556746-6437

Talk to a Data Expert

Have a question? We'll get back to you promptly.