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KMC Properties ASA
Interim / Quarterly Report • Aug 16, 2022
3645_rns_2022-08-16_4db86e2d-2f0f-426a-a317-11b97b393de2.pdf
Interim / Quarterly Report
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Letter from the CEO
Highlights
Second quarter of 2022 First half of 2022 Subsequent events
Key figures
Financial review
Financial results Financial position and cash flow Operational review Outlook Responsibility statement
Financial statements
Consolidated statement of comprehensive income Consolidated statement of financial position Consolidated statement of changes in equity Consolidated statement of cash flows
Notes to the financial statements
Selected notes to the interim financial statements
Note 01 Company information Note 02 Basis of preparation and accounting principles Note 03 Investment properties Note 04 Interest bearing debt Note 05 Tenancy agreements Note 06 Financial instruments Note 07 Discontinued operation Note 08 Related party transactions Alternative Performance Measures Definitions
Letter from the CEO
Highlights
Second quarter of 2022 First half of 2022 Subsequent events
Key figures
Financial review
Financial results Financial position and cash flow Operational review Outlook Responsibility statement
Financial statements
Consolidated statement of comprehensive income Consolidated statement of financial position Consolidated statement of changes in equity Consolidated statement of cash flows
Notes to the financial statements
Selected notes to the interim financial statements
Note 01 Company information Note 02 Basis of preparation and accounting principles Note 03 Investment properties Note 04 Interest bearing debt Note 05 Tenancy agreements Note 06 Financial instruments Note 07 Discontinued operation Note 08 Related party transactions Alternative Performance Measures Definitions
Comments from the CEO
In KMC Properties, we continue to execute on our growth strategy. 2022 has so far been eventful. We have had good progress on our development projects, announced three acquisitions, including four production properties, and announced a transformative property transaction with BEWI.
For the second quarter this year, we deliver a rental income of NOK 65 million, up from NOK 49 million for the same period last year, and from NOK 63 million for the previous quarter this year, primarily driven by additional income generated from new investments. For the first six months of 2022, rental income was NOK 127 million, compared to NOK 97 million for the comparable period of 2021.
Towards the end of the second quarter, we announced that we had entered an agreement with the listed packaging and insulation company BEWI, our largest tenant, for acquisition of an attractive property portfolio with up to 24 properties and one land plot with a gross asset value of up to approximately NOK 2.0 billion. The portfolio fits fully with our strategy of entering long lease agreements with solid tenants for properties with strategic locations. The additional portfolio will provide us with a strengthened market position and a new platform for accelerated value creation.
In addition to the BEWI transaction, we could announce our acquisition of two production properties in Denmark for DKK 151 million. The properties also have strategic locations and long lease agreements with solid tenants. At the end of the second quarter this year, our investment properties were valued at NOK 4 129 million, up from NOK 4 028 at the end of the previous period and from 4 001 million at the end of 2021. For the period, the increase relates to upgrades of existing properties by NOK 31 million and fair value adjustments of close to NOK 8 million, while translation adjustments contribute with NOK 63 million of the increase.
As communicated in the first quarter, we have decided to discontinue our operations in Russia and thus divest our office building in Moscow. The property is therefore currently classified as held for sale. The sales process has progressed throughout the second quarter.
Our development projects continued to show good progress this quarter, including the development of the new packaging hub for BEWI at Jøsnøya, Hitra, which commenced in May, the production facility for Oppdal Spekemat where we expect completion in the third quarter this year, and the development of the salmon slaughterhouse facility for Slakteriet.
To conclude, we are very pleased with what we have achieved so far this year. Our key priority the next few months will be to secure completion of the BEWI transaction and make sure the properties acquired are well integrated into our property management, and at the same time continue to further develop our pipeline of attractive M&A opportunities. We are very well positioned to reach our strategic target of a NOK 8 billion real estate portfolio by the end of 2024, one year ahead of the previous growth plan.
Trondheim, 15 August 2022
Liv Malvik Chief executive officer, KMC Properties ASA
Letter from the CEO
Highlights
Second quarter of 2022 First half of 2022 Subsequent events
Key figures
Financial review
Financial results Financial position and cash flow Operational review Outlook Responsibility statement
Financial statements
Consolidated statement of comprehensive income Consolidated statement of financial position Consolidated statement of changes in equity Consolidated statement of cash flows
Notes to the financial statements
Selected notes to the interim financial statements Note 01 Company information Note 02 Basis of preparation and accounting principles Note 03 Investment properties Note 04 Interest bearing debt Note 05 Tenancy agreements Note 06 Financial instruments Note 07 Discontinued operation Note 08 Related party transactions Alternative Performance Measures
KMC Properties Second quarter and first half 2022 3
About KMC Properties
KMC Properties is an Oslo Børs listed real estate company focusing on industrial- and logistic properties. The company has a diversified portfolio of properties in the Nordics and the Netherlands. The properties are strategically located and have long lease agreements with solid tenants.
KMC Properties is focusing on the high-yield segment. The majority of the company's rental agreements, both existing and potential, are long-term triple net bare house contracts resulting in low operational expenses and a solid operational cash flow. A large share of the company's gross asset value is related to a contractual cash flow. As the properties are at very strategic locations for the tenants, contract extensions are likely and will have a positive value adjustment potential.
The company has an ambitious growth strategy with a solid pipeline of M&A initiatives and development projects. KMC Properties expects its growth to eventually have positive impact on its financial expenses, as a result of expected lower interest margin on interest-bearing debt, further improving the income from property management.
Letter from the CEO
Highlights
Second quarter of 2022 First half of 2022 Subsequent events
Key figures
Financial review
Financial results Financial position and cash flow Operational review Outlook Responsibility statement
Financial statements
Consolidated statement of comprehensive income Consolidated statement of financial position Consolidated statement of changes in equity Consolidated statement of cash flows
Notes to the financial statements
Selected notes to the interim financial statements
Note 01 Company information Note 02 Basis of preparation and accounting principles Note 03 Investment properties Note 04 Interest bearing debt Note 05 Tenancy agreements Note 06 Financial instruments Note 07 Discontinued operation Note 08 Related party transactions Alternative Performance Measures Definitions
Contact information
Highlights*
Second quarter of 2022
- Income of NOK 64.7 million (49.0) for the second quarter of 2022
- Net income from property management of NOK 28.1 million (12.7)
- Invested NOK ~30.7 million in development of existing properties
- Agreement for transformative acquisition of NOK 2.0 billion real estate portfolio from BEWI
- Ongoing process for sale of office building in Moscow
First half of 2022
- Income of NOK 127.4 million for the first half of 2022
- Net income from property management of NOK 51.1 million
- Invested NOK ~52.9 million in development of existing properties
- Completed acquisitions of NOK 190 million with gross yield of ~7.6 per cent
- Following initiation of a sales process, the office building in Moscow has been re-classified as held for sale.
Subsequent events
■ Acquisition of two properties in Denmark for DKK ~151 million
Portfolio value ˜ 4.1bn
* Numbers in parenthesis refers to comparable figures for the corresponding period of 2021.
Letter from the CEO
Highlights
Second quarter of 2022 First half of 2022 Subsequent events
Key figures
Financial review
Financial results Financial position and cash flow Operational review Outlook Responsibility statement
Financial statements
Consolidated statement of comprehensive income Consolidated statement of financial position Consolidated statement of changes in equity Consolidated statement of cash flows
Notes to the financial statements
Selected notes to the interim financial statements
Note 01 Company information Note 02 Basis of preparation and accounting principles Note 03 Investment properties Note 04 Interest bearing debt Note 05 Tenancy agreements Note 06 Financial instruments Note 07 Discontinued operation Note 08 Related party transactions Alternative Performance Measures Definitions
Contact information
Key figures
The investment in Russia is presented as a discontinued operation and the associated assets and liabilities presented as held for sale in accordance with IFRS 5 as of 30 June 2022. Comparative figures, including key figures, are changed accordingly.
| Amounts in NOK million except percentage | Q2 2022 | Q2 2021 | H1 2022 | H1 2021 | 2021 |
|---|---|---|---|---|---|
| Rental income | 64.7 | 49.0 | 127.4 | 97.2 | 205.0 |
| Change period-on-period | 32% | - | 31% | - | |
| Net operating income (NOI) | 64.4 | 49.0 | 126.1 | 95.0 | 202.4 |
| Change period-on-period | 31% | - | 33% | - | |
| Net income from property management 1) | 28.2 | 12.7 | 51.1 | 14.8 | 12.7 |
| Change period-on-period | 121% | - | 245% | - | |
| Profit before tax from continued operations | 96.4 | 41.8 | 179.6 | 115.8 | 379.8 |
| Change period-on-period | 131% | - | 55% | - | |
| Profit from discontinued operations | 2.2 | 1.7 | (49.5) | 4.2 | 1.9 |
| Change period-on-period | 27% | - | (1285%) | - | |
| Profit after tax | 75.0 | 30.9 | 87.1 | 91.5 | 304.8 |
| Change period-on-period | 143% | - | (5%) | - | |
| Group property portfolio value | 4 129 | 3 307 | 4 129 | 3 307 | 4 002 |
| Net nominal interest bearing debt 1) | 2 075 | 1 873 | 2 075 | 1 873 | 2 012 |
| Group net loan to value (%) 1) | 50.3% | 56.6% | 50.3% | 56.6% | 50.3% |
| Net asset value adjusted 2) | 2 157 | 1 404 | 2 157 | 1 404 | 1 968 |
| Number of shares | 284 643 649 | 241 746 544 | 284 643 649 | 241 746 544 | 281 871 544 |
| Number of properties 2) | 46 | 41 | 46 | 41 | 44 |
| Property net yield | 6.4% | 6.1% | 6.4% | 6.1% | 6.4% |
| WAULT (years) | 10.0 | 10.6 | 10.0 | 10.6 | 10.4 |
| Occupancy rate (%) | 100.0% | 98.8% | 100.0% | 98.8% | 98.8% |
| All amounts in NOK per share except percentage | Q2 2022 | Q2 2021 | H1 2022 | H1 2021 | 2021 |
| Net income from property management per share | 0.10 | 0.05 | 0.18 | 0.06 | 0.05 |
| Change period-on-period | 94% | - | 198% | - | - |
| Profit after tax per share | 0.26 | 0.13 | 0.31 | 0.38 | 1.08 |
| Change period-on-period | 106% | - | (19%) | - | - |
| Net asset value adjusted pr share | 7.58 | 5.81 | 7.58 | 5.81 | 6.98 |
| Change period-on-period | 30% | - | 30% | - | - |
| Share price end of period 3) | 8.26 | 6.81 | 8.26 | 6.81 | 10.70 |
| Change period-on-period | 21% | - | 21% | - | - |
| Share price 3) / NAV | 1.09 | 1.17 | 1.09 | 1.17 | 1.53 |
| Change period-on-period | (7%) | - | (7%) | - | - |
1) See section concerning "Alternative performance measures" for calculation of the key figure.
2) Does not include property in Moscow.
3) Intraday volume-weighted average price (VWAP).
Amounts in NOK million Annual run rate 1) Gross rental income 268.4 Property related expenses (4.1) Net operating income 264.3 SG&A expenses 2) (33.9) EBITDA 230.4 Realised financial expenses 3) (117.4) Net income from property management 113.0
1) Based on final agreements as of period end.
2) Does not include transaction costs and variable remuneration to employees.
3) Based on 3 months Nibor and swap agreements at period end. Does not include interest expenses on revolving credit facility.
Letter from the CEO
Highlights
Second quarter of 2022 First half of 2022 Subsequent events
Key figures
Financial review
Financial results Financial position and cash flow Operational review Outlook Responsibility statement
Financial statements
Consolidated statement of comprehensive income Consolidated statement of financial position Consolidated statement of changes in equity Consolidated statement of cash flows
Notes to the financial statements
Selected notes to the interim financial statements
Note 01 Company information Note 02 Basis of preparation and accounting principles Note 03 Investment properties Note 04 Interest bearing debt Note 05 Tenancy agreements Note 06 Financial instruments Note 07 Discontinued operation Note 08 Related party transactions Alternative Performance Measures Definitions
Contact information
Financial review
KMC Properties has, since the company was established through a transformative transaction with Storm Real Estate in December 2020, owned an office building in Moscow, Russia. During the first quarter of 2022, the company decided to discontinue its operations in Russia completely and thus sell the building. Hence, the accounting figures for the operations in Russia and its assets and liabilities, for the current and previous periods, are presented separately in the financial results and in the financial position.
Financial results
Rental income
Amounts in NOK million
| Rental income current period (Q2 2022) | 64.7 |
|---|---|
| Agio/disagio | 0.2 |
| Income from new investments | 1.7 |
| Rental income previous period (Q1 2022) | 62.7 |
Rental income for the second quarter of 2022 amounted to NOK 64.7 million, up from NOK 49.0 million for the comparable period in 2021. The change of approximately NOK 2.0 million from the contractual rental income in the previous period is specified in the table above. For the first six months of 2022 the rental income amounted to NOK 127.3 million, up from NOK 97.2 million for the comparable period in 2021.
Due to the decision to sell the office building in Moscow, the rental income from Russia (NOK 6.5 million for the second quarter 2022 and NOK 11.0 for the first half of 2022 and NOK 6.6 million for the fourth quarter of 2021) is presented under "Profit from discontinued operations".
KMC Properties has invested NOK 45.7 million in upgrades in its property at Leknes and is currently in the final phase of deciding the rental increase related to the completed capex project together with its tenant. Until the rental increase is set, KMC Properties is invoicing its tenant approximately NOK 0.65 million per quarter. The income is accounted as a financial income.
Contractual rental income development (NOK million) (based on final agreements as of period end) (includes NOK 0.65 million of income from the property at Leknes each quarter, see description above):
Net operating income
Since most of the group's lease agreements are triple net bare house agreements, direct property costs are low. Hence net operating income amounted to NOK 64.4 million for the second quarter and NOK 126.1 million for the first six months of 2022, compared to NOK 49.0 million and NOK 95.0 million respectively for the comparable periods in 2021. The increase is related to income from new investments and CPI adjustments.
Letter from the CEO
Highlights
Second quarter of 2022 First half of 2022 Subsequent events
Key figures
Financial review
Financial results Financial position and cash flow Operational review Outlook Responsibility statement
Financial statements
Consolidated statement of comprehensive income Consolidated statement of financial position Consolidated statement of changes in equity Consolidated statement of cash flows
Notes to the financial statements
Selected notes to the interim financial statements
Note 01 Company information Note 02 Basis of preparation and accounting principles Note 03 Investment properties Note 04 Interest bearing debt Note 05 Tenancy agreements Note 06 Financial instruments Note 07 Discontinued operation Note 08 Related party transactions Alternative Performance Measures Definitions
Employee benefit and salary expenses amounted to NOK 4.9 million for the quarter, up from NOK 3.9 million for the second quarter last year, and NOK 11.6 million for the first six months of 2022, compared to NOK 6.2 million for the same period of 2021. The company has strengthened its organisation significantly during 2021 and 2022.
| Amounts in NOK million | Q2 | Q2 | H1 | H1 |
|---|---|---|---|---|
| 2022 | 2021 | 2022 | 2021 | |
| Administrative costs | 4.1 | 2.3 | 8.1 | 6.7 |
| Transaction costs | 0.1 | 10.2 | 2.7 | 27.7 |
| Other operating expenses | 4.2 | 12.5 | 10.8 | 34.4 |
Other operating expenses came in at NOK 4.2 million for the second quarter this year, compared to NOK 12.5 million last year, and NOK 10.8 million for the first six months, down from NOK 34.4 million for the same period last year. Transaction costs, mainly legal and other advisory fees related to investment and financing activities, amounted to NOK 2.7 million for the first six months of 2022.
Total operating profit before fair value adjustments ended at NOK 55.3 million for the second quarter of 2022, compared to NOK 32.7 million for the second quarter of 2021. For the first half of 2022, the total operating profit came in at NOK 103.6 million, up from NOK 54.4 million for the first half of 2021.
Net financials
| Amounts in NOK million | Q2 2022 | Q2 2021 | H1 2022 | H1 2021 |
|---|---|---|---|---|
| Realised financial income | 0.7 | - | 1.5 | - |
| Interest expenses 1) | (27.8) | (19.9) | (54.0) | (39.6) |
| Net realised financials | (27.1) | (19.9) | (52.5) | (39.6) |
| Change in value financial instruments | 2.9 | (14.9) | 93.9 | 26.8 |
| Other unrealised financials | 56.9 | 7.0 | 29.2 | (27.9) |
| Net financials | 32.8 | (27.8) | 70.6 | (40.7) |
1) Does not include amortisation of capitalised borrowing cost.
Net realised financials came in at a negative NOK 27.1 million for the quarter, compared to a negative NOK 19.9 million) last year. For the first six months, net realised financials amounted to a negative NOK 52.5 million, compared to negative NOK 39.6 million for the first six months of 2021. The cost increase relates to higher interest-bearing debt and higher interest rates.
NOK 0.65 million of the financial income in the second quarter of 2022 was interest income on the investment in the property at Leknes, see comment under "Rental income" above.
Net income from property management (see definition under "Alternative Performance Measures") came in at NOK 28.1 million for the quarter, up from NOK 12.7 million for the corresponding period last year, and NOK 51.1 million for the first six months, up from NOK 14.8 million in 2021.
Tax expense was NOK 23.5 million this quarter, up from NOK 12.6 million for the second quarter of 2021.
For the first half of 2022, the tax expense amounted to NOK 43.0 million. Of this, NOK 9.2 million is tax payable and the remaining NOK 33.8 million is change in deferred tax. For the same period last year, the tax expense was NOK 4.2 million
Net profit after tax was NOK 75.0 million for the quarter and NOK 87.1 million for the first six months of 2022. In comparison, the net profit was NOK 30.9 million and 91.5 million for the same periods of 2021.
Total comprehensive income came in at NOK 138.6 million for the second quarter this year, up from NOK 55.8 million for the same quarter last year, and NOK 125.2 million for the first six months of 2022, up from NOK 55.6 million for the same period of 2021.
Letter from the CEO
Highlights
Second quarter of 2022 First half of 2022 Subsequent events
Key figures
Financial review
Financial results Financial position and cash flow Operational review Outlook Responsibility statement
Financial statements
Consolidated statement of comprehensive income Consolidated statement of financial position Consolidated statement of changes in equity Consolidated statement of cash flows
Notes to the financial statements
Selected notes to the interim financial statements
Note 01 Company information Note 02 Basis of preparation and accounting principles Note 03 Investment properties Note 04 Interest bearing debt Note 05 Tenancy agreements Note 06 Financial instruments Note 07 Discontinued operation Note 08 Related party transactions Alternative Performance Measures Definitions
Financial position and cash flow
Property portfolio
| Amounts in NOK million | Q2 2022 | H1 2022 |
|---|---|---|
| Opening balance | 4 028.1 | 4 001.6 |
| Classified as held for sale | - | (142.6) |
| Purchase of investment properties | - | 188.2 |
| Upgrades of investment properties | 30.7 | 52.9 |
| Fair value adjustments | 7.7 | 4.8 |
| Translation adjustment | 62.8 | 24.4 |
| Value at period end | 4 129.3 | 4 129.3 |
The portfolio is valued by Cushman & Wakefield quarterly. For the second quarter of 2022, the total change in value for the company's investment properties amounted to NOK 101.2 million.
Expansion projects, investments in new facilities, and acquisitions amounted to a total of NOK 30.7 million in the quarter and 52.9 for the first six months.
In addition, fair value adjustments contributed with NOK 7.7 million for the quarter and adjustment of right-of-use asset according to IFRS 16 amounted to NOK 0.6 million which in total gives the NOK 8.3 million change in fair value adjustments in the statement of comprehensive income. The change in fair value for the first six months was NOK 4.8 million.
Translation adjustments contributed with NOK 62.8 million for the quarter and 24.4 for the first six months of 2022.
Other assets consist primarily of interest rate and currency rate swap agreements of NOK 161.9 million, other long-term assets of NOK 4.9 million, trade receivables of NOK 8.0 million, prepaid expenses, VAT receivables, tax receivables, and other current receivables of NOK 7.8 million, assets held for sale at 151.4 million as well as NOK 136.3 million in cash.
Total non-current liabilities amounted to NOK 2 523.3 million at the end of the quarter, up from NOK 2 436.3 million at the end of 2021. The liabilities consist mainly of net interest-bearing debt of NOK 2 336.2 million, deferred tax liabilities of NOK 165.9 million, and land lease liabilities of NOK 18.0 million.
Total current liabilities amounted to NOK 85.1 million on 30 June 2022, up from NOK 60.9 million at the end of 2021, consisting mainly of short-term interest-bearing debt (construction loan) of 28.6, trade payables of NOK 23.5 million, taxes of NOK 3.6 million, other current liabilities of NOK 18.0 million and liabilities held for sale 11.5 MNOK.
Total equity was NOK 1 991.2 million on 30 June 2022, representing an equity ratio of 43.3 per cent, compared to NOK 1 836.0 million at the end of 2021, equalling an equity ratio of 42.4 per cent.
Consolidated cash flow
Operating activities generated a cash inflow of NOK 53.4 million for the second quarter, compared to NOK 3.1 million for the same quarter last year, and NOK 115.2 million for the first six months of 2022, up from NOK 4.3 million for the same period of 2021.
Investment activities generated a cash outflow of NOK 29.3 million for the quarter and NOK 239.7 million for the first six months of 2022, due to investments in expansion projects, investments in new facilities, and acquisitions of new properties. For the corresponding periods of 2021, investment activities amounted to NOK 101.6 million and 151.5 million, respectively.
Financing activities led to a cash outflow of NOK 11.6 million for the quarter and an inflow of NOK 53.8 million for the first six months of 2022. In 2021, the company had a cash inflow of NOK 154.0 million for the second quarter and NOK 169.4 million for the first half of the year.
Letter from the CEO
Highlights
Second quarter of 2022 First half of 2022 Subsequent events
Key figures
Financial review
Financial results Financial position and cash flow Operational review Outlook Responsibility statement
Financial statements
Consolidated statement of comprehensive income Consolidated statement of financial position Consolidated statement of changes in equity Consolidated statement of cash flows
Notes to the financial statements
Selected notes to the interim financial statements
Note 01 Company information Note 02 Basis of preparation and accounting principles Note 03 Investment properties Note 04 Interest bearing debt Note 05 Tenancy agreements Note 06 Financial instruments Note 07 Discontinued operation Note 08 Related party transactions Alternative Performance Measures Definitions
Operational review
KMC Properties ASA is a real estate company focused on owning industrial- and logistics properties. The company owns a diversified portfolio in the Nordics and the Netherlands. The properties have long-term lease agreements with solid counterparties, strategically located for the tenants.
Before 28 December 2020, the company's legal and commercial name was Storm Real Estate ASA (Storm). An agreement was completed on 20 December 2020, combining Storm and KMC Properties AS, and transforming the company (Storm) from a single asset company to a strong real estate group.
History and important events in the development of the group
| 2020 | EVENT |
|---|---|
| 20 December | Completion of the agreement to combine Storm Real Estate ASA (later KMC Properties ASA) and KMC Properties AS into one entity |
| 30 December | Storm Real Estate ASA changed its name to KMC Properties ASA and its municipality from Oslo to Trondheim |
| 2021 | EVENT |
|---|---|
| 19 February | Completion of subsequent offering related to the NOK 300 million private placement |
| 3 March | Letter of intent with BEWI for development of packaging hub at Hitra |
| 13 April | Acquisition of industrial property in Denmark |
| 27 May | Acquisition of industrial property outside Molde in Norway |
| 27 May | Appointment of Kristoffer Holmen as CFO |
| 2 July | Agreement with Oppdal Spekemat for construction of new production facility |
| 8 July | Long-term lease agreement with BEWI for the new packaging hub at Hitra |
| 12 July | Acquisition of industrial property with long-term lease at Mongstad for NOK 285 million |
| 23 August | Letter of Intent with Slakteriet Holding AS to build NOK 620 million salmon slaughterhouse facility |
| 16 September | Private placement of NOK 300 million successfully completed |
| 28 October | Subsequent offering completed |
| 25 November | Acquisition of modern industrial property at Ågotnes for NOK 128 million |
| 15 December | Acquisition of industrial property in Fredrikstad in Norway for NOK 52 million |
| 2022 | EVENT |
|---|---|
| 21 January | Acquisition of herring production facility in Sweden from Klädesholmen Seafood for SEK 94 million |
| 2 February | Acquisition of meat processing facility near Narvik for NOK 100 million |
| 9 February | Process agreement for construction of salmon slaughterhouse facility with Slakteriet, following LOI in August 2021 |
| 2 June | Announced agreements for development of salmon slaughterhouse facility for Slakteriet, following LOI in August 2021 |
| 30 June | Agreement for transformative acquisition of NOK 2.0 billion real estate portfolio from BEWI |
| 15 July | Acquisition of two production properties in Denmark for DKK ~151 million |
Important events in the first half of 2022 Acquisitions
Acquisition of herring production facility in Sweden for SEK 94 million
On 21 January 2022, KMC Properties announced the acquisition of a herring production and cold storage facility in Rönnäng, in the Swedish country of Västra Götaland, from Klädesholmen Seafood AB for approximately SEK 93.6 million (approximately NOK 90 million).
The property included a triple-net bare house agreement with Klädesholmen Seafood with an initial lease term of 15 years and a yield-on-cost estimated at 7.5 per cent.
Klädesholmen Seafood, owned by Grøntvedt which is KMC Properties' fourth' largest tenant, is a modern herring production company.
Letter from the CEO
Highlights
Second quarter of 2022 First half of 2022 Subsequent events
Key figures
Financial review
Financial results Financial position and cash flow Operational review Outlook Responsibility statement
Financial statements
Consolidated statement of comprehensive income Consolidated statement of financial position Consolidated statement of changes in equity Consolidated statement of cash flows
Notes to the financial statements
Selected notes to the interim financial statements
Note 01 Company information Note 02 Basis of preparation and accounting principles Note 03 Investment properties Note 04 Interest bearing debt Note 05 Tenancy agreements Note 06 Financial instruments Note 07 Discontinued operation Note 08 Related party transactions Alternative Performance Measures Definitions
NOK 30 million of the consideration was settled by issuance of new shares in KMC Properties to the seller at a subscription price of NOK 10.8221 per share, equal to the volume weighted average share price for trades in the company's shares on the Oslo Stock Exchange the last 30 days prior to the date of completion of the transaction. The remainder, approximately NOK 64 million was settled in cash.
Acquisition of meat processing facility near Narvik in Northern Norway for NOK 100 million
On 2 February 2022, KMC Properties announced its acquisition of a modern meat processing facility, strategically located at Fagernes near Narvik in Norway, from Kubera AS for a consideration of approximately NOK 100 million.
The property came with a bare house agreement with the tenant, Kuraas AS, which is on a 6.5-year lease with the option to extend. The total consideration for the property was approximately NOK 100 million, with a yield of 7.8 per cent based on the rent for 2022.
Kuraas is a Norwegian producer and seller of meats, headquartered in Narvik.
The acquisition was completed on 10 February 2022 and was financed through a combination of bank loan and equity.
Entered a conditional agreement for acquisition of properties in Denmark for DKK 151 million
On the morning of 19 May 2022, KMC Properties announced that it had received acceptance of a conditional offer for the acquisition of two industrial properties in Denmark for approximately DKK 151.1 million.
The properties are composed of a total 85 866 sqm BTA of land and 43 361 sqm BTA of buildings, with further development potential.
The properties come with a triple-net bare house agreement with the two tenants, KpK Døre og Vindue A/S and Outline Vinduer A/S, with an initial lease of 10 years and an option to extend. Total consideration for the two properties is approximately DKK 151.1 million, with a gross yield of 7.85 per cent.
The tenants are part of the listed company Inwido, a leading European provider of customised solutions for windows and doors, with net sales of SEK 7.7 billion in 2021.
The transaction is subject to customary closing conditions and is expected to be completed in the third quarter of 2022.
Agreement for transformative acquisition of NOK 2.0 billion real estate portfolio from BEWI
On 30 June 2022, KMC Properties announced that the company, through a wholly owned subsidiary, entered an agreement with BEWI ASA for the acquisition of up to 24 properties and one land plot with a gross asset value of up to approximately NOK 2.0 billion.
In connection with the transaction, long term triple net rental agreements, averaging an initial lease of 16.5 years, will be entered into for the properties.
The 24 properties and one land plot included in the transaction are composed of a total 244 415 sqm gross area (BTA) of buildings and 999 714 sqm BTA of land, with a gross yield of 6.31 per cent. 19 of the properties are currently owned by Jackon, which BEWI is in the process of acquiring, hence, completion of the transaction is subject to closing of BEWI's acquisition of Jackon.
KMC Properties is obligated to acquire the Norwegian and Swedish properties comprised by the agreement valued to approximately NOK 970 million, including 12 properties and one land plot, with a gross yield of 6.31 per cent. KMC Properties expects the acquisition of these properties to happen shortly after BEWI has completed its acquisition of Jackon, which BEWI has communicated is expected to happen in the third quarter of 2022. A due diligence of the properties is currently ongoing.
Further, the company has an exclusive right to acquire the remaining part of the portfolio, including properties in Germany, Belgium, Poland, Finland, and Denmark, within twelve months from today. KMC Properties intends to utilize the exclusive right.
KMC Properties will finance the transaction by a combination of new equity, drawings on existing loan facilities, new committed loans, and cash on balance sheet and from operations. Accordingly, the company is contemplating a private placement of new shares to be conducted in the third quarter of 2022 to raise gross proceeds in the amount of NOK 350 million, subject to prevailing market conditions.
The private placement is fully underwritten by a group of investors including BEWI Invest AS and HAAS AS at a minimum subscription price of NOK 8 per share. BEWI Invest, the company's largest shareholder, will at least be allocated a percentage of the new shares equal to its holding. The underwriters will receive a 4 per cent underwriting commission based on the sum of the respective underwriter's commitment. KMC Properties obligation to pay the underwriting commission will be settled by issuance of new shares at the same price as the other shares in the private placement.
Ongoing development projects
Progress to new conditional agreement with Slakteriet for development of salmon slaughterhouse facility
On 2 June 2022, KMC Properties announced that it had entered a conditional share purchase agreement (SPA) and a conditional lease agreement with Slakteriet for development of the salmon slaughterhouse facility, as previously announced in stock exchange announcement of 23 August 2021 (LOI) and the update of 9 February 2022.
The agreements include the acquisition of the land plot and preliminary works for approximately NOK 41.3 million. Further,
Letter from the CEO
Highlights
Second quarter of 2022 First half of 2022 Subsequent events
Key figures
Financial review
Financial results Financial position and cash flow Operational review Outlook Responsibility statement
Financial statements
Consolidated statement of comprehensive income Consolidated statement of financial position Consolidated statement of changes in equity Consolidated statement of cash flows
Notes to the financial statements
Selected notes to the interim financial statements
Note 01 Company information Note 02 Basis of preparation and accounting principles Note 03 Investment properties Note 04 Interest bearing debt Note 05 Tenancy agreements Note 06 Financial instruments Note 07 Discontinued operation Note 08 Related party transactions Alternative Performance Measures Definitions
Contact information
the parties have entered a triple-net bare house lease agreement for the slaughterhouse facility with an initial term of 20 years, with an option for the tenant to extend for 4 times 5 years. The agreements are subject to customary closing conditions and financing.
The development project is progressing according to plan and is expected to be completed during the first half of 2024. Estimated total investment has been updated from NOK 620 million to NOK 682 million, still with a yield-on-cost of 6.75 per cent.
Established in 1989, Slakteriet is one of Norway's biggest fish slaughter companies, with major facilities in Florø and Brekke.
Conditional long-term lease agreement with BEWI for new packaging hub at Jøsnøya
In March 2021, KMC Properties entered a letter of intent (LOI) with BEWI ASA for development of a new packaging facility on Jøsnøya, Hitra, on the west coast of Central Norway. In July 2021, the company announced that it had entered a conditional long-term lease agreement for the property with BEWI with an initial term of 15 years, with an option for BEWI to extend the lease term two times by five year each.
The project commenced in May 2022 and BEWI has entered a long-term supply agreement for delivery of fish boxes from the new facility to the listed seafood company Mowi, the world's largest producer of Atlantic salmon.
Completion of the development is expected in the second half of 2023.
Agreement with Oppdal Spekemat for construction of a new production facility
On 2 July 2021, KMC Properties entered an agreement with Oppdal Spekemat AS for construction of a new production facility at Oppdal, in Trøndelag county in central Norway.
The agreement stipulates that KMC Properties acquires a plot from Oppdal Spekemat and finances and builds the new production facility. When completed, the facility will be leased to Oppdal Spekemat on a triple-net bare-house agreement, with an initial lease term of 15 years, with the option of an extension. The initial lease term is irrevocable.
The construction cost is estimated to be approximately NOK 85 million, and the yield-on-cost is set on 7.5 per cent.
The development project is progressing according to plan, with expected completion in the third quarter of 2022.
Impacts from Russia's invasion of Ukraine
Since KMC Properties was established through the combination with Storm Real Estate, the company has had an intention to divest the property in Russia, as it does not fit the company's investment strategy.
Early in the first half of 2022, prior to Russia's invasion of
Ukraine, the company initiated a sale of the office building in Moscow. As a result, the building and related operations were re-classified as held for sale in the Q1 report, as explained above. Due to the effects of Russia's invasion of Ukraine, the value of the property was written-down by NOK 52.7 million in Q1 2022.
Sanctions imposed on Russia following the invasion, has significantly increased the risks related to KMC Properties' operations in Russia. Since the invasion, the company has, with assistance from Baker McKenzie in Russia, performed a sanction control on its current tenants in Russia without any significant findings. In addition, KMC Properties is monitoring the changing regulatory requirements with assistance from legal and financial consultants in Norway and Russia.
On 30 June 2022, the property in Russia was valued at NOK 135.8 million. The valuation is unchanged in RUB from 31 March, hence the increase in value in NOK is due to translation adjustments.
Share information
KMC Properties ASA is listed on the Oslo Børs (Oslo Stock Exchange) under the symbol KMCP.
The company has a total of 284 643 649 issued and outstanding shares as of 15 August 2022.
For a continuously updated overview of the company's largest shareholders, see the Investor section at the company's homepage: www.kmcp.no
During the first half of 2022, the KMC Properties' share was traded between NOK 7.80 and NOK 11.10 per share, with a closing price of NOK 8.12 on 30 June 2022.
Significant risks and uncertainties
KMC Properties' risks and risk management are described in the group's annual report for 2021.
For the second half of 2022, KMC Properties' most significant risks and uncertainties relate to construction risk related to development projects. At the end of the first half of 2022, the company had three ongoing development projects, as described above, whereas one is expected to be completed in the third quarter this year.
Although KMC Properties is well experienced in executing on development projects, there is always a risk related to construction projects. The risk is mitigated as KMC Properties always enters turnkey contracts with suppliers, and thus the company considers the risk to be limited.
Further, the company is in the process of divesting its office building in Russia. The significant geopolitical risks related to Russia is affecting the sale process. Currently, the office building is valued at approximately RUB 700 million, down from approximately RUB 1 200 million at year-end 2021. In addition, there are significant risks related to the final currency
Letter from the CEO
Highlights
Second quarter of 2022 First half of 2022 Subsequent events
Key figures
Financial review
Financial results Financial position and cash flow Operational review Outlook Responsibility statement
Financial statements
Consolidated statement of comprehensive income Consolidated statement of financial position Consolidated statement of changes in equity Consolidated statement of cash flows
Notes to the financial statements
Selected notes to the interim financial statements
Note 01 Company information Note 02 Basis of preparation and accounting principles Note 03 Investment properties Note 04 Interest bearing debt Note 05 Tenancy agreements Note 06 Financial instruments Note 07 Discontinued operation Note 08 Related party transactions Alternative Performance Measures Definitions
Contact information
conversion to NOK, and whether a potential buyer is able to transfer the amount to KMC Properties' bank account in Norway. For more details, see note 7 below.
The significant increase in inflation worldwide and the central banks reaction to this has resulted in increased interest rates. This is affecting KMC Properties' financial expenses and may affect the valuation of the portfolio. However, KMC Properties has a 54 per cent hedging ratio and is operating in a high yield segment, hence the company has solid foundation for handling this risk.
The economic uncertainty worldwide may affect KMC Properties' tenant's ability to pay their rent. However, the company
Outlook
KMC Properties continues to execute on its growth strategy. The company has announced three acquisitions year to date, including four production properties, in addition to a transformative agreement with the listed company BEWI for the purchase of a real estate portfolio of up to NOK 2 billion with long lease agreements. All acquisitions are in line with the company's investment strategy, focusing on properties and property portfolios in Northern Europe within foodstuff facilities and light industry, in collaboration with current and new tenants.
In the first half of 2022, KMC Properties has completed and committed investments in current portfolio (capex) of NOK 48 million with a yield on cost of approximately 7.5 per cent and has a 100 per cent occupancy rate and very solid tenants, thus the company considers the risk to be limited.
Subsequent events
KMC Properties signs agreement for acquisition of two production properties in Denmark
On 15 July 2022, with reference to stock exchange notice of 19 May 2022 regarding KMC Properties receiving acceptance of a conditional offer for the acquisition of two industrial properties in Denmark for approximately DKK 151.1 million, the company announced that it had signed an agreement.
in greenfield projects of NOK 180 million with a yield on cost of approximately 7.1 per cent. The company has completed acquisitions of approximately NOK 190 million, with gross yield of 7.6 per cent. In addition, KMC Properties is actively pursuing specific acquisitions in 2022 valued at approximately NOK 1,365 million with weighted average gross yield of 6.6 per cent, which includes the Norwegian and Swedish properties in the transformative agreement with BEWI.
Following the recent acquisitions and the transformative agreement with BEWI, KMC Properties is very well positioned to reach NOK 8 billion in GAV by the end of 2024, one year ahead of the previous growth plan.
Responsibility statement
We declare that, to the best of our knowledge, the half year financial statements for the period 1 January to 30 June 2022 have been prepared in accordance with IAS 34 – Interim Reporting, and that the information contained therein provides a true and fair view of the Group's assets, liabilities, financial position, and overall results.
We further declare that, to the best of our knowledge, the halfyear report provides a true and fair view of important events that have taken place during the accounting period and their impact on the half-year financial statements, as well as the most important risks and uncertainties facing the business in the forthcoming accounting period.
Trondheim, Norway, 15 August 2022 The board of directors and CEO – KMC Properties ASA
Pål Aglen Morten Eivindssøn Astrup Nini Høegh Nergaard Anna Musiej Aanensen Chair Director Director Director
Stig Wærnes Marianne Bekken John Thoresen Liv Malvik
Director Director Director Chief executive officer
Letter from the CEO
Highlights
Second quarter of 2022 First half of 2022 Subsequent events
Key figures
Financial review
| Financial results | |
|---|---|
| Financial position and cash flow | |
| Operational review | |
| Outlook | |
| Responsibility statement |
Financial statements
Consolidated statement of comprehensive income Consolidated statement of financial position Consolidated statement of changes in equity Consolidated statement of cash flows
Notes to the financial statements
Selected notes to the interim financial statements Note 01 Company information Note 02 Basis of preparation and accounting principles Note 03 Investment properties Note 04 Interest bearing debt Note 05 Tenancy agreements Note 06 Financial instruments Note 07 Discontinued operation Note 08 Related party transactions Alternative Performance Measures Definitions
Consolidated statement of comprehensive income
| Amounts in NOK thousand | Note | Q2 2022 Unaudited |
Q2 2021 Unaudited |
H1 2022 Unaudited |
H1 2021 Unaudited |
2021 Audited |
|---|---|---|---|---|---|---|
| Rental income | 5 | 64 656 | 48 981 | 127 354 | 97 225 | 204 976 |
| Total income | 64 656 | 48 981 | 127 354 | 97 225 | 204 976 | |
| Property related expenses | 5 | 267 | (54) | 1 293 | 2 216 | 2 545 |
| Salary expenses | 4 911 | 3 882 | 11 646 | 6 207 | 20 567 | |
| Other operating expenses Total operating expenses |
4 219 9 397 |
12 507 16 335 |
10 817 23 756 |
34 368 42 791 |
43 477 66 589 |
|
| Operating profit (loss) before fair value adjustments | 55 259 | 32 646 | 103 597 | 54 434 | 138 388 | |
| Change in fair value adjustments on investment property | 3 | 8 330 | 36 952 | 5 420 | 102 025 | 317 331 |
| Total operating profit (loss) | 63 590 | 69 598 | 109 017 | 156 459 | 455 719 | |
| Fair value change of financial instruments Net currency exchange differences |
6 | 6 412 58 766 |
(14 874) - |
100 117 32 821 |
26 849 (38 305) |
63 812 (47 027) |
| Financial income | 738 | 12 648 | 1 518 | 12 704 | 6 553 | |
| Financial expenses | 4 | 33 132 | 25 578 | 63 845 | 41 921 | 99 243 |
| Net financial income (expense) | 32 784 | (27 804) | 70 612 | (40 673) | (75 905) | |
| Earnings before tax (EBT) | 96 374 | 41 794 | 179 629 | 115 786 | 379 814 | |
| Tax expense | 23 547 | 12 592 | 43 013 | 28 445 | 76 880 | |
| Profit from continued operations | 72 827 | 29 202 | 136 615 | 87 341 | 302 934 | |
| Profit from discontinued operations | 7 | 2 175 | 1 709 | (49 527) | 4 178 | 1 914 |
| Profit for the period | 75 002 | 30 911 | 87 088 | 91 519 | 304 847 | |
| Other comprehensive Income: | ||||||
| Items that may be reclassified to profit or loss: | ||||||
| Other comprehensive income (translation reserves) | 63 620 | 24 810 | 38 074 | (35 893) | (23 818) | |
| Tax on comprehensive income | - | - | - | - | - | |
| Other comprehensive income for the period, net of tax | 63 620 | 24 810 | 38 074 | (35 893) | (23 818) | |
| Total comprehensive income for the period | 138 622 | 55 721 | 125 162 | 55 626 | 281 029 | |
| Profit attributable to: Equity holders of the company |
75 002 | 30 911 | 87 088 | 91 519 | 304 847 | |
| Non-controlling interest | - | - | - | - | - | |
| Total comprehensive income attributable to: | ||||||
| Equity holders of the company | 138 622 | 55 721 | 125 162 | 55 626 | 281 029 | |
| Non-controlling interest | - | - | - | - | - |
Letter from the CEO
Highlights
Second quarter of 2022 First half of 2022 Subsequent events
Key figures
Financial review
Financial results Financial position and cash flow Operational review Outlook Responsibility statement
Financial statements
Consolidated statement of comprehensive income Consolidated statement of financial position Consolidated statement of changes in equity Consolidated statement of cash flows
Notes to the financial statements
Selected notes to the interim financial statements
Note 01 Company information Note 02 Basis of preparation and accounting principles Note 03 Investment properties Note 04 Interest bearing debt Note 05 Tenancy agreements Note 06 Financial instruments Note 07 Discontinued operation Note 08 Related party transactions Alternative Performance Measures Definitions
Consolidated statement of financial position
| 30.06.2022 | 30.06.2021 | 31.12.2021 | ||
|---|---|---|---|---|
| Amounts in NOK thousand | Note | unaudited | unaudited | audited |
| ASSETS | ||||
| Non-current assets | ||||
| Investment properties | 3 | 4 129 308 | 3 307 386 | 4 001 593 |
| Financial derivatives | 6 | 161 908 | 35 883 | 67 721 |
| Other long-term assets | 6 | 4 897 | - | 5 042 |
| Total non-current assets | 4 296 113 | 3 343 373 | 4 074 355 | |
| Current assets | ||||
| Trade receivables | 6 | 8 005 | 10 974 | 24 458 |
| Other receivables, prepaid expenses, and tax | 6 | 7 804 | 36 097 | 26 869 |
| Cash and cash equivalents | 6 | 136 331 | 147 285 | 207 512 |
| Assets held for sale | 7 | 151 367 | - | - |
| Total current assets | 303 506 | 194 653 | 258 839 | |
| Total assets | 4 599 619 | 3 538 026 | 4 333 194 | |
| Equity | ||||
| Share capital | 56 929 | 48 349 | 56 374 | |
| Share premium | 1 225 469 | 898 795 | 1 196 023 | |
| Sum paid-in equity | 1 282 398 | 947 144 | 1 252 398 | |
| Retained earnings and translation reserves | ||||
| Translation reserves | 4 197 | (45 952) | (33 877) | |
| Retained earnings | 704 568 | 424 626 | 617 479 | |
| Sum retained earnings and translation reserves | 708 765 | 378 674 | 583 601 | |
| Total equity | 1 991 163 | 1 325 818 | 1 835 999 | |
| LIABILITIES | ||||
| Non-current liabilities | ||||
| Deferred tax liabilities | 165 855 | 78 214 | 132 002 | |
| Interest bearing debt | 4, 6 | 2 336 224 | 1 867 025 | 2 275 035 |
| Other long-term Liabilities | 6 | 21 251 | 31 416 | 29 279 |
| Total non-current liabilities | 2 523 330 | 1 976 655 | 2 436 317 | |
| Current liabilities | ||||
| Short-term interest bearing debt | 4, 6 | 28 577 | 172 500 | - |
| Trade payables | 6 | 23 502 | 22 838 | 23 608 |
| Current tax liabilities | 6 | 3 560 | 3 957 | 2 906 |
| Other current liabilities | 6 | 18 032 | 36 257 | 34 364 |
| Liabilities held for sale | 7 | 11 455 | - | - |
| Total current liabilities | 85 126 | 235 553 | 60 878 | |
| Total liabilities | 2 608 456 | 2 212 208 | 2 497 195 | |
| Total equity and liabilities | 4 599 619 | 3 538 026 | 4 333 194 |
Trondheim, Norway, 15 August 2022 The board of directors and CEO – KMC Properties ASA
| Pål Aglen Chair |
Morten Eivindssøn Astrup Director |
Nini Høegh Nergaard Director |
Anna Musiej Aanensen Director |
|---|---|---|---|
| Stig Wærnes | Marianne Bekken | John Thoresen | Liv Malvik |
| Director | Director | Director | Chief executive officer |
Letter from the CEO
Highlights
Second quarter of 2022 First half of 2022 Subsequent events
Key figures
Financial review
Financial results Financial position and cash flow Operational review Outlook Responsibility statement
Financial statements
Consolidated statement of comprehensive income Consolidated statement of financial position Consolidated statement of changes in equity Consolidated statement of cash flows
Notes to the financial statements
Selected notes to the interim financial statements
Note 01 Company information Note 02 Basis of preparation and accounting principles Note 03 Investment properties Note 04 Interest bearing debt Note 05 Tenancy agreements Note 06 Financial instruments Note 07 Discontinued operation Note 08 Related party transactions Alternative Performance Measures Definitions
Consolidated statement of changes in equity
| Amounts in NOK thousand | Share capital |
Share premium |
Translation reserves |
Retained earnings |
Total equity |
|---|---|---|---|---|---|
| Total equity at 31.12.2020 | 48 153 | 892 397 | (10 059) | 312 631 | 1 243 122 |
| Issue of Shares | 8 221 | 318 173 | - | - | 326 394 |
| Transaction cost issue of shares | - | (14 547) | - | - | (14 547) |
| Profit /(loss) for the period | - | - | - | 304 847 | 304 847 |
| Other comprehensive income (translation reserves) | - | - | (23 818) | - | (23 818) |
| Total equity at 31.12.2021 | 56 374 | 1 196 023 | (33 877) | 617 478 | 1 835 599 |
| Issue of Shares | 554 | 29 446 | - | - | 30 000 |
| Transaction cost issue of shares | - | - | - | - | - |
| Profit /(loss) for the period | - | - | - | 87 088 | 87 088 |
| Other comprehensive income (translation reserves) | - | - | 38 074 | - | 38 074 |
| Total equity at 30.06.2022 | 56 929 | 1 225 469 | 4 197 | 704 568 | 1 991 163 |
Letter from the CEO
Highlights
Second quarter of 2022 First half of 2022 Subsequent events
Key figures
Financial review
Financial results Financial position and cash flow Operational review Outlook Responsibility statement
Financial statements
Consolidated statement of comprehensive income Consolidated statement of financial position Consolidated statement of changes in equity Consolidated statement of cash flows
Notes to the financial statements
Selected notes to the interim financial statements
Note 01 Company information Note 02 Basis of preparation and accounting principles Note 03 Investment properties Note 04 Interest bearing debt Note 05 Tenancy agreements Note 06 Financial instruments Note 07 Discontinued operation Note 08 Related party transactions Alternative Performance Measures Definitions
Contact information
Consolidated statement of cash flows
| Amounts in NOK thousand | Note | Q2 2022 | Q2 2021 | H1 2022 | H1 2021 | 2021 |
|---|---|---|---|---|---|---|
| Cash flows from operating activities | ||||||
| Earnings before tax | 96 374 | 41 794 | 179 629 | 115 786 | 379 814 | |
| Depreciation of tangible assets | 5 | 307 | 5 | 613 | 308 | |
| Fair value adjustment of investment properties | 3 | (8 330) | (36 952) | (5 420) | (102 025) | (317 331) |
| Financial items | (32 784) | 27 804 | (70 612) | 40 673 | 75 905 | |
| Change in working capital: | - | - | - | |||
| - change in trade and other receivables | (3 882) | 18 054 | 35 664 | 24 257 | 20 001 | |
| - change in trade and other payables, excl. corporate tax | 6 650 | (47 744) | (19 494) | (73 757) | (78 689) | |
| Taxes paid | (4 614) | (131) | (4 613) | (1 275) | (2 326) | |
| Net cash flow from operating activities | 53 419 | 3 132 | 115 158 | 4 272 | 77 682 | |
| Acquisition of businesses, net of cash acquired | - | - | - | - | - | |
| Purchase of investment properties | - | (101 777) | (188 213) | (151 505) | (520 082) | |
| Capital expenditure on investment properties | (30 716) | - | (52 918) | - | (140 064) | |
| Interest received | 1 437 | 134 | 1 437 | - | - | |
| Net cash flow from investment activities | (29 279) | (101 643) | (239 694) | (151 505) | (660 146) | |
| Cash flows from financing activities | ||||||
| Capital increase from issue of shares | - | - | 30 000 | 6 594 | 326 394 | |
| Proceeds interest bearing debt | 4 | - | 36 293 | 65 000 | 34 680 | 439 480 |
| Repayment interest bearing debt | 4 | (4 852) | - | (6 811) | - | (2 790) |
| New short-term interest bearing debt | 28 577 | 145 000 | 28 577 | 172 500 | - | |
| Change in other long-term debt | (6 617) | - | (8 028) | 4 773 | 2 636 | |
| Transaction fees paid and other financial costs | (897) | - | (897) | (2 270) | (14 547) | |
| Interest paid | (27 762) | (27 325) | (54 000) | (46 875) | (86 504) | |
| Net cash flow from financing activities | (11 551) | 153 968 | 53 841 | 169 402 | 664 669 | |
| Effects of exchange rate changes on cash and cash equivalents | (616) | 360 | (487) | - | 191 | |
| Net change in cash and cash equivalents | 11 974 | 55 818 | (71 181) | 22 170 | 82 396 | |
| Cash and cash equivalents at beginning of period | 124 357 | 91 468 | 207 512 | 125 116 | 125 116 | |
| Cash and cash equivalents at end of period | 136 331 | 147 285 | 136 331 | 147 285 | 207 512 | |
Letter from the CEO
Highlights
Second quarter of 2022 First half of 2022 Subsequent events
Key figures
Financial review
Financial results Financial position and cash flow Operational review Outlook Responsibility statement
Financial statements
Consolidated statement of comprehensive income Consolidated statement of financial position Consolidated statement of changes in equity Consolidated statement of cash flows
Notes to the financial statements
Selected notes to the interim financial statements
Note 01 Company information Note 02 Basis of preparation and accounting principles Note 03 Investment properties Note 04 Interest bearing debt Note 05 Tenancy agreements Note 06 Financial instruments Note 07 Discontinued operation Note 08 Related party transactions Alternative Performance Measures Definitions
Contact information
Selected notes to the interim financial statements
Note 01 Company information
The KMC Properties ASA Real Estate Group conducts business in Europe. The group's business idea is primarily to acquire and manage commercial industry and logistics properties. The property portfolio is mainly comprising industrial and logistics properties, in addition to a smaller proportion office property. The holding company, KMC Properties ASA, is a public limited liability company with headquarter in Trondheim, Norway.
The company's shares are listed on the Oslo Stock Exchange under the ticker "KMCP".
For more information, including company related risks, please see the annual report for 2021.
Note 02 Basis of preparation and accounting principles
The results for the period have been prepared in accordance with IAS 34 Interim Financial Reporting. The accounting principles that have been used in the preparation of the interim financial statements are in conformity with the principles used in preparation of the annual financial statements for 2021.
In the first half of 2022 the group decided to exit the Russian market and initiated an active process to locate a buyer for its Russian subsidiary owning the company's office building in Moscow. The investment in Russia is consequently presented as a discontinued operation and the associated assets and liabilities presented as held for sale in accordance with IFRS 5 as of 30 June 2022. Comparative figures are changed accordingly.
The financial reporting covers KMC Properties ASA and subsidiaries. The interim financial statements have not been audited.
Note 03 Investment properties
The valuation of the properties on 30 June 2022 has been performed by the independent expert valuer, Cushman & Wakefield.
| Amounts in NOK million | Q2 2022 | Q2 2021 | H1 2022 | H1 2021 | 2021 |
|---|---|---|---|---|---|
| Opening balance | 4 028 | 3 090 | 4 002 | 3 090 | 3 090 |
| Classified as held for sale | - | - | (143) | - | - |
| Purchase of investment properties | - | 72 | 188 | 72 | 520 |
| Upgrades of investment properties | 31 | 80 | 53 | 80 | 140 |
| Fair value adjustments | 8 | 37 | 5 | 102 | 310 |
| Translation adjustment | 63 | 29 | 24 | (36) | (58) |
| Value at period end | 4 129 | 3 307 | 4 129 | 3 307 | 4 002 |
The sensitivity of the fair-value assessment of investment properties depends to a considerable extent on assumptions related to yield, interest rates, market rents and operating costs for the properties. The table below presents examples of how changes related to each of these variables influenced property values, on 30 June 2022, assuming all other variables remained constant (amounts in NOK million). However, there are interrelationships between these variables, and it is expected that a change in one variable may influence one or more of the other variables.
| Variables | Change of variables | Value change (+) | Value change (-) |
|---|---|---|---|
| Exit yield | +/- 0.25 per cent points | (55) | 60 |
| Discount rate | +/- 0.25 per cent points | (87) | 88 |
| Operating costs | +/- 10 per cent | (11) | 11 |
| Market rent | +/- 10 per cent | 187 | (187) |
| Average rental growth | +/- 0.5 percentages points next 10 years | 143 | (138) |
The calculations have been performed by Cushman & Wakefield in connection the valuations at 30 June 2022.
Letter from the CEO
Highlights
Second quarter of 2022 First half of 2022 Subsequent events
Key figures
Financial review
| Financial results |
|---|
| Financial position and cash flow |
| Operational review |
| Outlook |
| Responsibility statement |
Financial statements
Consolidated statement of comprehensive income Consolidated statement of financial position Consolidated statement of changes in equity Consolidated statement of cash flows
Notes to the financial statements
Selected notes to the interim financial statements
| Note 01 Company information | |
|---|---|
| Note 02 Basis of preparation and accounting principles | |
| Note 03 Investment properties | |
| Note 04 Interest bearing debt | |
| Note 05 Tenancy agreements | |
| Note 06 Financial instruments | |
| Note 07 Discontinued operation | |
| Note 08 Related party transactions | |
| Alternative Performance Measures | |
| Definitions |
Contact information
Note 04 Interest bearing debt
| Q2 2022 | Q2 2021 | 2021 |
|---|---|---|
| 1 850 | ||
| - | - | - |
| 1 850 | 1 850 | 1 850 |
| (9) | (15) | (12) |
| 1 841 | 1 835 | 1 838 |
| (52) | 27 | 43 |
| 1 850 | 1 850 |
* The fair value presented above is the excess value given by Nordic Bond Pricing AS.
| Bank loans: | |||
|---|---|---|---|
| Amounts in NOK million | Q2 2022 | Q2 2021 | 2021 |
| Opening balance | 500 | - | - |
| Net change in debt | (5) | 32 | 437 |
| Interest-bearing debt at period end | 495 | 32 | 437 |
| Capitalised borrowing cost | - | - | - |
| Carrying amount interest-bearing debt at period end | 495 | 32 | 437 |
| Additional bank loan obtained before report date | - | 294 | - |
| Bank loan at report date | 495 | 326 | 437 |
Construction loan bank:
| Amounts in NOK million | Q2 2022 | Q2 2021 | 2021 |
|---|---|---|---|
| Opening balance | - | - | - |
| Net change in debt | 29 | - | - |
| Interest-bearing debt as at period end | 29 | - | - |
| Capitalised borrowing cost | - | - | - |
| Carrying amount interest-bearing debt | 29 | - | - |
Revolving credit facility:
| Amounts in NOK million | Q2 2022 | Q2 2021 | 2021 |
|---|---|---|---|
| Opening balance Net change in debt |
- - |
- 173 |
- - |
| Interest-bearing debt as at period end | - | 173 | - |
| Capitalised borrowing cost | - | - | - |
| Carrying amount interest-bearing debt | - | - |
Interest-bearing debt at period end:
| NOK million |
Weighted average current interest |
Weighted average interest terms |
Weighted average amortisation plan bank loans (years) |
Weighted average years to final maturity |
In compliance with covenants? |
|
|---|---|---|---|---|---|---|
| Bond loan | 1 850 | 5.93% | 3 months NIBOR+4.25% |
None | 1.4 | Yes |
| Bank loan | 495 | 4.17% | 3 months NIBOR+2.5% |
22.7 | 6.2 | Yes |
| Construction loan | 29 | 4.68% | 3 months NIBOR+3% |
None | N/A | Yes |
| Revolving credit facility | - | 3.93% | 3 months NIBOR+2.25% |
N/A | N/A | Yes |
| Total | 2 373 | 5.55% | 2.4 | Yes |
1) 3 months Nibor is set to 1.68%.
Letter from the CEO
Highlights
Second quarter of 2022 First half of 2022 Subsequent events
Key figures
Financial review
Financial results Financial position and cash flow Operational review Outlook Responsibility statement
Financial statements
Consolidated statement of comprehensive income Consolidated statement of financial position Consolidated statement of changes in equity Consolidated statement of cash flows
Notes to the financial statements
Selected notes to the interim financial statements
Note 01 Company information Note 02 Basis of preparation and accounting principles Note 03 Investment properties Note 04 Interest bearing debt Note 05 Tenancy agreements Note 06 Financial instruments Note 07 Discontinued operation Note 08 Related party transactions Alternative Performance Measures Definitions
Contact information
Security bond loan:
| Amounts in NOK million | H1 2022 | H1 2021 | 2021 |
|---|---|---|---|
| Pledged property portfolio Disposal Account |
3 029.1 40.7 |
2 943.3 - |
2 943.3 - |
| Opening balance security 1) | 3 069.8 | 2 943.3 | 2 943.3 |
| Investments in pledged property portfolio | 11.3 | 80.0 | 110.9 |
| Sale of assets in pledged property portfolio | - | - | (133.3) |
| Inflow Disposal Account | - | - | 133.3 |
| Outflow Disposal Account | - | - | (92.6) |
| Fair value and translation adjustments pledged property portfolio 2) | 15.2 | 60.9 | 108.2 |
| Value security end of period | 3 096.3 | 3 084.1 | 3 069.8 |
1) The bond is secured by, in addition to mortgages over the properties, share charges over the shares of the guarantors, pledges over bank accounts, Norwegian floating charges over trade receivables, and certain other floating charges / enterprise mortgages in Finland, Denmark and Sweden. 2) In accordance with valuation from Cushman & Wakefield at 30 June 2022.
The bond terms governing the bond issue, require that all funds received from sale of pledged properties shall be paid into a bank account blocked and pledged in favour of the bond holders (the "Disposal Account"). Funds from the Disposal Account may be used to finance development of properties in the bond security package. Hence, in accordance with the bond terms, KMC Properties ASA sold KMC Havnegata 16 AS from KMC Properties AS to KMC Properties II Norway AS for NOK 133.3 million, on 2 July 2021. The purchase was done using standard terms, and the price was based on Cushman and Wakefield's valuation of the property on 15 June 2021. The acquisition was partly financed through a bank loan of NOK 86 million. The purchase price was paid to the Disposal Account. Since then, Nordic Trustee has released NOK 92.6 million from the Disposal Account to finance the investments in the pledged property portfolio.
Note 05 Tenancy agreements
The group mainly enters into long-term lease agreements with solid counterparties, for properties that are strategically located for the tenants. Most lease contracts are "triple-net bare house lease agreements". Lease payments of the contracts include CPI increases.
Net operating income (NOI) from properties:
| Amounts in NOK million | Q2 2022 | Q2 2021 | H1 2022 | H1 2021 | 2021 |
|---|---|---|---|---|---|
| Rental Income Norway | 41.8 | 26.5 | 82.7 | 53.9 | 121.7 |
| Rental Income Sweden | 8.8 | 6.7 | 16.6 | 13.7 | 28.2 |
| Rental Income Denmark | 6.1 | 5.1 | 12.2 | 11.1 | 23.7 |
| Rental Income Holland | 6.8 | 9.5 | 13.5 | 16.2 | 26.8 |
| Rental Income Finland | 1.2 | 1.2 | 2.3 | 2.3 | 4.6 |
| Total rental income | 64.7 | 49.0 | 127.4 | 97.2 | 205.0 |
| Property related costs | (0.3) | 0.1 | (1.3) | (2.2) | (2.5) |
| NOI from properties | 64.4 | 49.0 | 126.1 | 95.0 | 202.4 |
Summary of significant contracts
There were no significant investments or acquisitions with related parties in the first half of 2022, but a substantial part of rental income is from rental contracts with related parties.
| Amounts in NOK million | Q2 2022 | Q2 2021 | H1 2022 | H1 2021 | 2021 |
|---|---|---|---|---|---|
| BEWI & subsidiaries | 25.2 | 23.9 | 50.2 | 49.7 | 93.9 |
| Insula & subsidiaries | 12.8 | 12.0 | 25.6 | 24.0 | 47.5 |
| Grøntvedt & subsidiaries | 7.8 | 6.4 | 14.7 | 12.4 | 24.0 |
| PSW Technology | 7.8 | - | 15.6 | - | 10.8 |
| Other | 11.0 | 6.7 | 21.3 | 11.1 | 28.8 |
| Total | 64.7 | 49.0 | 127.4 | 97.2 | 205.0 |
Letter from the CEO
Highlights
Second quarter of 2022 First half of 2022 Subsequent events
Key figures
Financial review
Financial results Financial position and cash flow Operational review Outlook Responsibility statement
Financial statements
Consolidated statement of comprehensive income Consolidated statement of financial position Consolidated statement of changes in equity Consolidated statement of cash flows
Notes to the financial statements
Selected notes to the interim financial statements
Note 01 Company information Note 02 Basis of preparation and accounting principles Note 03 Investment properties Note 04 Interest bearing debt Note 05 Tenancy agreements Note 06 Financial instruments Note 07 Discontinued operation Note 08 Related party transactions Alternative Performance Measures Definitions
Note 06 Financial instruments
The carrying amount of financial instruments in the group's balance sheet is considered to provide a reasonable expression of their fair value, with the exception of interest-bearing debt. The fair value of interest-bearing debt is described in note 5. A specification of the group's financial instruments is presented below.
| Amortised | Fair value through | |||
|---|---|---|---|---|
| cost | profit or loss | Total | ||
| Amounts in NOK million | 30.06.2022 | 30.06.2022 | 30.06.2022 | 31.12.2021 |
| Financial assets | ||||
| Cash and cash equivalents | 136.3 | - | 136.3 | 207.5 |
| Land plot lease agreements (financial asset) | - | - | - | - |
| Currency and interest swaps (long-term) | - | 161.9 | 161.9 | 67.7 |
| Trade receivables (non-interest bearing) | 8.0 | - | 8.0 | 24.5 |
| Other receivables | 12.4 | - | 12.4 | 14.2 |
| Total financial assets | 156.8 | 161.9 | 318.7 | 314.0 |
| Financial liabilities | ||||
| Interest-bearing loans and borrowings | 2 364.8 | - | 2 364.8 | 2 275.0 |
| Land plot lease agreements (financial liability) | 18.3 | - | 18.3 | 19.5 |
| Other financial liabilities | - | - | - | 9.4 |
| Trade payables (non-interest bearing) | 23.5 | - | 23.5 | 23.6 |
| Other current liabilities (non-interest bearing) | 21.6 | - | 21.6 | 38.0 |
| Total financial liabilities | 2 428.2 | - | 2 428.2 | 2 365.5 |
| Net financial assets and liabilities | (2 271.5) | 161.9 | (2 109.6) | (2 051.5) |
Interest bearing loans
| Amounts in NOK million | 30.06.2022 | 31.12.2021 |
|---|---|---|
| Bond | 1 850.0 | 1 850.0 |
| Bank loan | 494.9 | 436.7 |
| Construction loan (short-term) | 28.6 | - |
| RCF (short-term) | - | - |
| Total interest-bearing loans | 2 373.5 | 2 286.7 |
| Hedged amount (fixed interest) | 1 275.0 | 1 240.0 |
| Hedge ratio | 54% | 54% |
Swap agreements at period end
| Swap agreement | Currency amount (million) |
Start date | Maturity date | Fixed currency rate | Fixed interest |
|---|---|---|---|---|---|
| Interest & currency | NOK 335 | 23.12.2020 | 11.12.2023 | EUR/NOK = 10.630 EURIBOR = -0.51% | |
| Interest & currency | NOK 240 | 23.12.2020 | 11.12.2023 | SEK/NOK = 1.050 | STIBOR = 0.017% |
| Interest & currency | NOK 165 | 23.12.2020 | 11.12.2023 | DKK/NOK = 1.428 | DANISH IBOR = -0.505% |
| Interest | NOK 500 | 13.07.2021 | 31.12.2030 | Not applicable | NIBOR = 1.5175% |
| Interest | EUR 32 | 11.12.2023 | 13.12.2027 | Not applicable | EURIBOR = -0.03% |
| Interest | SEK 120 | 11.12.2023 | 13.12.2027 | Not applicable | STIBOR = 0,686% |
| Interest | DKK 120 | 11.12.2023 | 13.12.2027 | Not applicable | DANISH IBOR = 0.215% |
| Interest | NOK 35 | 10.02.2022 | 10.02.2027 | Not applicable | NIBOR = 2.305% |
The table below shows an analysis of fair values of financial instruments in the Statement of Financial Position at 30.06.2022, grouped by level in the fair value hierarchy:
■ Level 1 - Quoted prices in active markets that the entity can access at the measurement date.
■ Level 2 – Use of a model with inputs other than level 1 that are directly or indirectly observable market data.
■ Level 3 - Use of a model with inputs that are not based on observable market data.
Letter from the CEO
Highlights
Second quarter of 2022 First half of 2022 Subsequent events
Key figures
Financial review
Financial results Financial position and cash flow Operational review Outlook Responsibility statement
Financial statements
Consolidated statement of comprehensive income Consolidated statement of financial position Consolidated statement of changes in equity Consolidated statement of cash flows
Notes to the financial statements
Selected notes to the interim financial statements
Note 01 Company information Note 02 Basis of preparation and accounting principles Note 03 Investment properties Note 04 Interest bearing debt Note 05 Tenancy agreements Note 06 Financial instruments Note 07 Discontinued operation Note 08 Related party transactions Alternative Performance Measures Definitions
Financial assets measured at fair value:
| Amounts in NOK million | Level 1 | Level 2 | Level 3 | Sum |
|---|---|---|---|---|
| Currency and interest swaps | - | 161.9 | - | 161.9 |
| Sum financial assets measured at fair value | - | 161.9 | - | 161.9 |
Note 07 Discontinued operation
The office building in Moscow was valued at approximately RUB 700 million at the end of June 2022, down from approximately RUB 1,200 million at the end of 2021. The valuation method is the same as previous periods, however, experience from the current sale process is also taken into consideration. The value in RUB is unchanged since last quarter, however the RUB/NOK has increased significantly during Q2 2022, from RUB/NOK = 0.1076 on 31 March 2022 to RUB/NOK = 0.1933 on 30 June 2022, hence the value of the office building in NOK has changed from NOK 75.4 million in Q1 to NOK 135.8 million in Q2.
The current sale process is affected by the significant geopolitical risks related to Russia. The sale price will likely be in RUB and there are significant risks related to the final currency translation to NOK, and whether a potential buyer is able to transfer the amount to KMC Properties' bank account in Norway.
Discontinued operation
| Amounts in NOK thousand | Q2 2022 | Q2 2021 | H1 2022 | H1 2021 | 2021 |
|---|---|---|---|---|---|
| Total income | 6 510 | 4 695 | 11 022 | 9 564 | 21 169 |
| Total operating expenses | 4 356 | 2 777 | 7 318 | 5 147 | 11 714 |
| Operating profit (loss) before fair value adjustments | 2 154 | 1 918 | 3 704 | 4 417 | 9 455 |
| Change in fair value adjustments on investment property | 425 | - | (52 702) | - | (7 184) |
| Total operating profit (loss) | 2 579 | 1 918 | (48 998) | 4 417 | 2 271 |
| Net financial income (expense) | 62 | 44 | 97 | 42 | 186 |
| Earnings before tax (EBT) | 2 641 | 1 962 | (48 901) | 4 459 | 2 457 |
| Tax expense | 466 | 253 | 626 | 281 | 543 |
| Profit from discontinued operation | 2 175 | 1 709 | (49 527) | 4 178 | 1 914 |
| Cash flow from operating activities | 2 817 | 1 889 | 4 996 | 4 126 | 7 983 |
| Cash flow from investing activities | 110 | 29 | (12) | 47 | 227 |
| Cash flow from financing activities | (1 343) | - | (1 857) | (1 144) | (8 756) |
| Net change in cash and cash equivalents | 1 584 | 1 918 | 3 127 | 3 029 | (546) |
Assets and liabilities of disposal group classified as held for sale
The following assets and liabilities were reclassified as held for sale in relation to the discontinued operation at 30 June 2022.
Assets classified as held for sale
| Amounts in NOK thousand | 30.06.2022 | 31.03.2022 |
|---|---|---|
| Investment property | 135 767 | 75 363 |
| Other long-term assets | 35 | 28 |
| Trade receivables | 3 356 | 2 226 |
| Other receivables, prepaid expenses, and tax | 4 324 | 2 798 |
| Cash and cash equivalents | 7 885 | 3 288 |
| Total assets of disposal group held for sale | 151 367 | 83 703 |
Liabilities directly associated with assets classified as held for sale
| Amounts in NOK thousand | 30.06.2022 | 31.03.2022 |
|---|---|---|
| Other long-term liabilities | 313 | 512 |
| Trade payables | 129 | 51 |
| Other current liabilities | 11 013 | 6 108 |
| Total liabilities of disposal group held for sale | 11 455 | 6 671 |
Letter from the CEO
Highlights
Second quarter of 2022 First half of 2022 Subsequent events
Key figures
Financial review
Financial results Financial position and cash flow Operational review Outlook Responsibility statement
Financial statements
Consolidated statement of comprehensive income Consolidated statement of financial position Consolidated statement of changes in equity Consolidated statement of cash flows
Notes to the financial statements
Selected notes to the interim financial statements
Note 01 Company information Note 02 Basis of preparation and accounting principles Note 03 Investment properties Note 04 Interest bearing debt Note 05 Tenancy agreements Note 06 Financial instruments Note 07 Discontinued operation Note 08 Related party transactions Alternative Performance Measures Definitions
Note 08 Related party transactions
The tenants BEWI and Insula are regarded as related parties by their ownership in KMC Properties ASA through BEWI Invest AS and Kverva Industrier AS. Reference is made to note 5 Tenancy agreements for detailed information.
KMC Properties ASA has in the first half of 2022 purchased services for NOK 1.2 million from BEWI related companies, mainly cost of interim hiring of employees and office rent.
Alternative Performance Measures
KMC Properties ASA's financial information is prepared in accordance with the international financial reporting standards (IFRS). In addition, the company reports alternative performance measures (APMs) that are regularly reviewed by management to enhance the understanding of the company's performance as a supplement, but not as a substitute, to the financial statements prepared in accordance with IFRS. Financial APMs are intended to enhance comparability of the results and cash flows from period to period. The financial APMs reported by KMC Properties ASA are the APMs that, in management's view, provide relevant supplemental information of the company's financial position and performance. Operational measures such as, but not limited to, occupancy and WAULT are not defined as financial APMs according to ESMA's guidelines.
Net Asset Value adjusted (NAV adjusted)
| Amounts in NOK million | 30.06.2022 | 30.06.2021 | 31.12.2021 |
|---|---|---|---|
| Total equity Deferred tax liabilities |
1 991 166 |
1 326 78 |
1 836 132 |
| Net asset value (NAV) | 2 157 | 1 404 | 1 968 |
Debt ratio – group net LTV
| Amounts in NOK million | 30.06.2022 | 30.06.2021 | 31.12.2021 |
|---|---|---|---|
| Interest bearing debt (bond, nominal value) | 1 850 | 1 850 | 1 850 |
| Bank loan | 495 | 32 | 437 |
| Loans from credit institutions (Construction loan and RCF) | 29 | 173 | - |
| Cash and cash equivalents | (136) | (147) | (208) |
| Mark-to-market hedge adjustment | (162) | (36) | (68) |
| Net interest-bearing debt | 2 075 | 1 872 | 2 012 |
| Investment property (market value) | 4 129 | 3 307 | 4 002 |
| Group Net LTV | 50.3% | 56.6% | 50.3% |
Net income from property management
| Amounts in NOK million | Q2 2022 | Q2 2021 | H1 2022 | H1 2021 |
|---|---|---|---|---|
| Operating profit (loss) before fair value adjustments Net realised financials |
55.3 (27.1) |
32.6 (19.9) |
103.6 (52.5) |
54.4 (39.6) |
| Net income from property management | 28.2 | 12.7 | 51.1 | 14.8 |
Letter from the CEO
Highlights
Second quarter of 2022 First half of 2022 Subsequent events
Key figures
Financial review
Financial results Financial position and cash flow Operational review Outlook Responsibility statement
Financial statements
Consolidated statement of comprehensive income Consolidated statement of financial position Consolidated statement of changes in equity Consolidated statement of cash flows
Notes to the financial statements
Selected notes to the interim financial statements
Note 01 Company information Note 02 Basis of preparation and accounting principles Note 03 Investment properties Note 04 Interest bearing debt Note 05 Tenancy agreements Note 06 Financial instruments Note 07 Discontinued operation Note 08 Related party transactions Alternative Performance Measures Definitions
Contact information
Definitions
| Bonds, or the bond issue | NOK 1 850 million senior secured bond with 3 years tenor issued on 11 December 2020 |
|---|---|
| Cushman & Wakefield | Cushman & Wakefield Realkapital, Kronprinsesse Märthas plass 1, 0125 Oslo, Norway, |
| Gross Rental Income (GRI) | Equals total income |
| Independent valuer | Cushman & Wakefield |
| Loan-To-Value (LTV) | Total net nominal value of interest-bearing debt divided by the total market value of the property portfolio. |
| Market value of portfolio | The market value of all properties owned by the parent company and subsidiaries. |
| Net Asset Value, adjusted (NAV) | NAV from an ordinary long-term operational perspective of the business. Based on total equity in the balance sheet, adjustments are made for the carrying amount of deferred tax |
| NOK | The Norwegian Krone, the official currency of Norway |
| Occupancy rate (%) | Leased lettable area (sqm) / Total lettable area (sqm) |
| OPEX | Operating expense, measured by total operating expenses – salary expenses |
| SG&A | Selling, general & administrative expenses, calculated as salary expenses |
| Property related expenses | Property-related expenses include administrative costs related to the management of the properties as well as operating and maintenance costs. |
| SWAP | A swap is an agreement between two parties to exchange sequences of cash flows for a set period of time |
| WAULT | Weighted Average Unexpired Lease Term measured as the remaining contractual rent amounts of the current lease contracts of the investment properties of the group, including areas that have been re-let and signed new contracts, adjusted for termination rights and excluding any renewal options, divided by contractual rent, including renewed and signed new contracts. |
Letter from the CEO
Highlights
Second quarter of 2022 First half of 2022 Subsequent events
Key figures
Financial review
Financial results Financial position and cash flow Operational review Outlook Responsibility statement
Financial statements
Consolidated statement of comprehensive income Consolidated statement of financial position Consolidated statement of changes in equity Consolidated statement of cash flows
Notes to the financial statements
Selected notes to the interim financial statements Note 01 Company information Note 02 Basis of preparation and accounting principles Note 03 Investment properties Note 04 Interest bearing debt Note 05 Tenancy agreements Note 06 Financial instruments Note 07 Discontinued operation Note 08 Related party transactions Alternative Performance Measures Definitions
Contact information
Dyre Halses gate 1a NO-7042 Trondheim
[email protected] +47 480 03 175
kmcp.no