Company presentation Baard Schumann, CEO Haavard Rønning, CFO August 2013
Selvaag Bolig is a residential developer that provides targeted housing concepts to suit aspirations of different households in and around the main cities: Oslo , Stavanger and Bergen
Norway’s leading homebuilder Tromsø 243 units ¡ Sales in 1H: 443 units ¡ Industrial approach to homebuilding Trondheim 260 units ¡ Land bank for 10 800 homes ¡ Housing concepts Bergen tailored to house buyer 189 units Greater-Oslo requirements 7859 units Stavanger Stockholm 1 891 units 79 units Other 310 units Note: The numbers represent the size of the land portfolio as at 30. June 2013. All numbers are adjusted for Selvaag Bolig’s share in joint ventures. 1) Greater Oslo area: Oslo, Akershus, Buskerud, Vestfold and Østfold, 2) 260 units at Stord (Hordaland county) and 50 units at Alfaz Del Sol (Spain), 3) The residential property development portfolio consists of land plots that are to be paid for when planning permission is received. These have a development potential of ~3 350 residential units, whereof the company has purchasing obligations for ~2 900 and purchasing options for ~450. units.
Three well defined and robust concepts § Affordable apartments based on a "no frills" model § Low cost land plots situated in fringe zones of large cities § Mostly modular based construction § Young people in the start-up phase § Apartments/small houses situated in high density areas § Established housing solutions, solid quality and well planned living environment § Modular and on site construction § Single people/couples in all ages, with/without children § Apartments with attractive, central location in large cities § High quality standard coupled with a service concept § On site construction § Affluent customers who value comfort and convenience
Housing for all Housing for all The Gullhaug House 2013 50 000 homes Pluss: Housing with completed extra service 2012 Modular construction 2011 Listed at Oslo Børs 2003 2000 ����������������������� 1999 Løren district Terraced 1988 buildings «You can't criticise things unless you can simultaneously present 1958 Industrial production an alternative or a solution which 1951 is better than the one you're criticizing» 1948 Veitvet district The Ekeberg Olav Selvaag House
Value creation in Selvaag Bolig 6 – 36 MONTHS 12 – 24 MONTHS 6 – 12 MONTHS 3 – 9 MONTHS development Residential Acquire and Marketing refine land for Project design Construction and sale development creation Value Zoning Sales start Construction start Deliveries optimization § Plan and § Buy (i) options on § Target 60% pre-sale § Fixed price contracts with prepare for unzoned land, or (ii) before start-up reputable and solid Project construction ready to build land (irrevocable purchase counterpart contracts) § Lever acquired land § Construction costs financed to improve ROE § Prices on remaining 40% with construction loans increased gradually § Target 100% sale at delivery during sell out phase
Industrial approach ¡ Modular construction ¡ Profitable ¡ High quality ¡ Sub-contractors in ¡ Lower construction costs ¡ Reduced risk of faults Estonia and Poland ¡ Higher project margins ¡ Technically better homes ¡ Modern factories ¡ Sensible house prices ¡ Energy efficient homes ¡ 13 years of experience
Core business Organisation Employees: 80 Selvaag Bolig CEO Finance and Administration accounting Selvaag Bolig Sales and Property Portfolio Selvaag Pluss marketing investment management Service Modulbygg Customer SBO Rogaland support SBO Vestfold
FINANCIAL UPDATE Income statement IFRS (figures in NOK million) Q2 2013 Q2 2012 1H 2013 1H 2012 2012 Total operating revenues 620.9 494.4 1 144.6 686.4 2 812.0 Project expenses (479.9) (388.0) (857.8) (524.0) (2 141.3) Other operating expenses (56.9) (57.6) (100.4) (99.4) (212.7) Other gains (loss) - 0.1 - 0.1 0.1 Associated companies and joint ventures 10.2 15.2 10.0 22.6 53.4 EBITDA 94.3 64.190 196.5 85.7 511.5 Depreciation and amortisation (5.7) (4.8) (11.2) (9.9) (21.9) EBIT 88.6 59.433 185.2 75.8 489.6 Net financial expenses (6.5) (17.0) (21.1) (33.6) (41.5) Profit/(loss) before taxes 82.1 42.4 164.2 42.2 448.1 Income taxes (23.4) (17.9) (44.0) (11.8) (101.8) Net income 58.7 24.6 120.2 30.4 346.3 Net income for the period attributable to: Minority interests 2.7 (0.4) 7.7 (0.5) 68.0 Shareholders in Selvaag Bolig ASA (majority interests) 56.0 25.0 112.4 31.0 278.4
FINANCIAL UPDATE Cash Flow statement (figures in NOK million) Q4 2012 Q4 2011 1H 2013 1H 2012 2012 Net cash flow from operating activities 152.4 28.1 471.9 (296.7) 464.3 Net cash flow from investment activities 17.8 19.3 38.1 13.4 18.0 Net cash flow from financing activities (39.1) 30.1 (361.0) 277.4 (319.5) - - - - - Net change in cash and cash equivalents 131.1 77.5 149.0 (5.8) 162.8 Cash and cash equivalents at start of period 575.9 311.8 558.0 395.2 395.2 Cash and cash equivalents at end of period 707.0 389.4 707.0 389.4 558.0
FINANCIAL UPDATE Balance sheet (figures in NOK million) Q2 2013 Q2 2012 2012 Intangible assets 449.9 470.3 459.6 Property, plant and equipment 6.2 6.8 6.5 Investments in associated companies and joint ventures 155.3 135.1 158.4 Other non-current assets 129.5 83.0 152.4 Total non-current assets 741.1 695.1 776.8 Inventories (property) 3 915.2 4 599.4 3 910.7 - Land 1 870.9 2 425.4 1 961.0 - Work in progress 1 895.0 2 076.5 1 831.7 - Finished goods 149.3 97.5 118.0 Other current receivables 219.0 248.3 489.3 Cash and cash equivalents 707.0 389.4 558.0 Total current assets 4 841.2 5 237.0 4 958.0 TOTAL ASSETS 5 582.3 5 932.1 5 734.9 Equity attributed to shareholders in Selvaag Bolig ASA 2 184.6 1 813.1 2 072.2 Non-controlling interests 27.3 5.9 74.4 Total equity 2 211.9 1 819.0 2 146.6 Non-current interest-bearing liabilities 1 843.2 2 551.7 1 461.5 Other non-current non interest-bearing liabilities 257.2 139.0 213.1 Total non-current liabilities 2 100.4 2 690.7 1 674.6 Current interest-bearing liabilities 680.9 860.7 1 368.8 Other current non interest-bearing liabilities 589.0 561.8 544.8 Total current liabilities 1 269.9 1 422.4 1 913.7 TOTAL EQUITY AND LIABILITIES 5 582.3 5 932.1 5 734.9 * Corresponding to a book value of NOK 23.3 per share
FINANCIAL UPDATE Interest bearing debt Drawn per 30 June Interest rate Interest bearing debt as at 30 June 2013 Loan facility (NOKm) margin 1 NOK 500 million senior 500 4.75% unsecured bond loan 2 NOK 150 million revolving credit 0 2.50% 486 facility from DNB maturing in 2014 798 3 NOK 150 million working capital 0 2.50% NOK facility from DNB maturing in 2 524 2014 4 NOK 500 million long term land 432 2.25% Million loan from DNB 5 Land loan facilities from a range 808 2.20% - 3.15% of Nordic credit institutions 1 240 6 Construction loan facilities from 798 2.20% - 3.00% a range of Nordic credit institutions Top-up loan Land loan Construction loan Note: Bond loan of NOK 500m differs form the summed up top up loan in the table (NOK 486m). The difference is due to NOK -14m in amortized cost which is not actual debt. 12
Appendix
OPERATIONAL UPDATE Sales according to plan Residential units sold Sales value of sold units No of units No of units 1 011 966 897 834 820 722 649 443 388 # units # units # units # units # units 200 243 221 303 243 2010 2011 2012 2013 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Q1 Q2 Q3 Q4
OPERATIONAL UPDATE Production volume upheld Quarterly development Segment distribution as at 30.06.2013 39 No of units 213 1 131 Greater Oslo 1 067 1 059 1 058 1 131 993 Rest of Norway units Other countries 880 Sales status as at 30.06.2013 17 % 1 131 Sold units Unsold Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Note: All numbers are adjusted for Selvaag Bolig’s ownership in joint ventures. 83 % Measure point: decision of construction start. Selvaag Bolig has a number of joint venture projects under construction. The joint venture partners’ share amount to 56 residential units, implying that Selvaag Bolig currently manages 1 187 residential units under construction
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