INTERIM FINANCIAL STATEMENT HALF YEAR 2016 Helgi S. Gunnarsson 24 th August 2016
OPERATIONS AND RESULTS Reginn’s Results for the half year 2016 are good and consistent to • operational objectives. INCOME for fyrst half amounted to 3.222 m. ISK. There off leasing ⇧ 26% • income amounted to 2.946 m. ISK corresponding to 26% growth compared to same period 2015. OPERATIONAL RESULTS before assessment change and depreciation • ⇧ 25% / EBITDA were 2.126 m. ISK corresponding to 25% growth compared to the year 2015. THE RATIO „ Operational Results before assessment change and • 72% depreciation” / Leasing Income is just over 72% for the period and in accordance with the company’s objectives. ⇧ 65% NET RESULTS after tax amounted to 2.002 m. ISK which is 65 % • increase from the year before. • YIELD from investment properties is 5,9 % in the first half of 2016.* 5,9% *) Yield is calculated as Operational Results before assessment change and depreciation /assessment of properties using the average values for the period.
OPERATIONS AND RESULTS CONT. • Calculated ASSESSMENT CHANGES of investment properties in the quarter were 1.869 m. ISK. INVESTMENT PROPERTIES at the end of the period were assessed • to be 79.015 m. ISK and the equity ratio was 34% . INTEREST BEARING DEBTS were 47.767 m. ISK at the end of the • period compared to 39,474 m. ISK at the end of the year 2015. Leverage as a percentage of investment properties is 60% . INTEREST EXPENCES in the period were 1.009 m. ISK. compared • to 731 m. ISK. for the same period 2015. Total financial expenses were 1.512 m. ISK compared to 1.254 m. ISK. in 2015. NET CASH FLOW from operations amounted to 924 m. ISK in the • period. Net Cash at the end of the first half2016 was 511 m. ISK. REAL RETURN on equity was 16,8% on annual basis. •
OPERATIONS AND PROSPECTS Operations are as planned, revenues are growing and the • Quarterly Overwiev 2Q 2016 1Q 2016 demand for commercial properties increases. Leasing Leasing Revenues 1,555 1,391 rates are rising significanly. Revenues, Operations in properties 137 139 • Control of spending is successful, increases in the operational costs of investment properties are due to Total Revenues 1.692 1.530 increases in real estate taxes and in offset of projects. • Income and expenses for " The Centra - collection" are fully Operational costs of investement properties -319 -302 included in the quarter. Operational costs in properties -155 -141 • The restructuring of Smáralind is above expectations, the main objective to have H & M as an anchor store in the Administrative expenses -95 -84 mall was successful. • Accelerated restructuring progress of Smáralind will Gross profit before assessment changes 1.123 1.003 strengthen the company's cash flow earlier than planned. • Structural changes in the company are completed and operational projects on normal course. Head office has Assessment changes of investement properties 1.352 517 been moved within Smáralind, Reginn’s employees are now 19. Results from operations 2.475 1.520
COMPARISON OF QURTERS Key Figures 2014-2016 2014 2015 2016 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Leasing Revenues 902 1.023 1.140 1.172 1.107 1.231 1.281 1.378 1.391 1.555 Other Revenues 129 127 137 135 135 138 136 139 139 137 Total Revenues 1,031 1,150 1,277 1,307 1,242 1,369 1,417 1,517 1,530 1,692 Operatioal Costs of Investm. properties - 197 - 215 - 216 - 230 - 218 - 238 - 265 - 256 - 302 - 319 Administrative Expenses - 73 - 85 - 70 - 64 - 81 - 75 - 73 - 89 - 84 - 95 Operational Revenues before assm. chg. 618 703 862 852 799 906 940 980 1,003 1,123 • Even and steady growth has marked the operations. Typically profit has been in line with expectations . • Growth of revenues between quarters is excellent in spite of three larger temporary projects with lower revenues as of resturcturing. These projects are Smáralind, Hlíðasmári 1 og Tjarnarvellir 11. • The Occupancy Ratio of the portfolio is very good. The lowest ratio was 91% after purchasing "Fastengissafns", but has grown rapidly and has now reached 97,5% . • The core operations are strong and in line with objectives, the company's performance in the reception and processing of properties is high.
PROFIT VS LEASING REVENUES Leasing revenues Profit 1.450.000 Fjárhæðir í þ. kr. 1.200.000 REVENUES 950.000 700.000 450.000 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2012 2014 2015 2016 2013 (330.000) 28,0% 24,0% Fjárhæðir í þ. kr. (230.000) 20,0% Hlutfall af leigutekjum COSTS 16,0% (130.000) 12,0% 8,0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 (30.000) 4,0% 2012 2013 2014 2015 2016 Operational Expenses Administrative Expenses Operational Exp. ratio Administrative Exp. ratio
VALUE OF INVESTMENT PROPERTIES The portfolio was booked at 79,015 m. ISK at the end of June 2016. New investments in • investment properties in the first half of 2016 amounted to 13,216 m. ISK. • The portfolios of CFV 1 and Ósvör were added in the first quarter of 2016, at over 10 bill. ISK. Reginn’s investments in existing properties has also been about 1,700 m. ISK., the most significant being; Tjarnarvellir 11, Smáralind and Hafnartorg Increases in property taxation, decrease of the property value. Increasing effects are however • improved leasing utilisation and stronger revenues. In the period the company's holdings in Smárabyggð are added to the books, amounting to 805 m. ISK. REGINN‘S INVESTMENT PROPERTIES Centra - collection 75.000 Fjárfestingareignir í m.kr. 65.000 Fastengis -collection 55.000 Klasi properties 45.000 35.000 25.000 Q2 - Q3 - Q4 - Q1 - Q2 - Q3 - Q4 - Q1 - Q2 - Q3 - Q4 - Q1 - Q2 - Q3 - Q4 - Q1 - Q2 - 2012 2012 2012 2013 2013 2013 2013 2014 2014 2014 2014 2015 2015 2015 2015 2016 2016
LEASING PERFORMANCE • The year 2016 starts excellently and already more than 34 thousand square meters have been leased, both with new contracts and renewal of older contracts. Renewal is about 35% of the total number of leased square meters in 2016 Reginn has great capacity in processing and leasing of properties and has been successful in renewing older contracts. The year • 2015 was a record year when the leasing contracts included more than 35 thousand square meters. LEASED SQM ANNUALLY Following the signing of contracts with H&M as an • 35.000 anchor tenant in SMÁRALIND and HAFNARTORG, a Útleigðir fermetrar (uppsafnað) new phase started in the leasing of these projects. 30.000 25.000 • Leasing of restructured spaces in Smáralind is in the final phase. 20.000 • Leasing rates have been rising and new leases 15.000 demonstrate this. 10.000 The proportion of office space and more expensive • properties in new contracts are more extensive now than 5.000 in 2015. 0 3M 6M 9M 12M Quarter 2012 2013 2014 2015 2016
PUBLIC TENDERS THE NATIONAL THE STATE THE SHERIFF OF THE THE DIRECTORATE OF ADMINISTRATION OF MUSEUM OF PROCECUTOR CAPITAL AREA IMMIGRATION OCCUPATIONAL ICELAND SAFETY AND HEALTH HLÍÐASMÁRI 1 TJARNARVELLIR 11 SUÐURLANDSBRAUT 4 BÆJARHRAUN 16 DVERGSHÖFÐI 2 3.000 m 2 4.300 m 2 700 m 2 1.000 m 2 1.500 m 2 = 10.500 m 2
REGINN‘S PROPERTY ALLOCATIONS RETAIL AND SERVICE PROPERTIES has PROPERTY TYPES (m 2 ) declined in Reginn’s porfolio in recent years. Smáralind is 19% of Reginn’s portfolio and other retail and service properties is now 12% of total space. 12% 19% 5% OFFICE AND COMMERCIAL PROPERTIES is 32% and has increased in recent years in accordance with investment objectives. 12% 20% INDUSTRIAL AND STORAGE PROPERTIES percentage has increased as a result of 32% investment strategy of recent year. In total it accounts for 20% of the portfolio. Retail and service properties Smáralind HOTEL AND TURISM now accounts for about 5% Retail and service properties General Retail properties of Reginn‘s portfolio. Office and commercial properties Industrial and storage properties SPORTS AND ENTERTAINMENT continues to Hotels and tourism decrease and is now about 12% of the total Sports and entertainment portfolio.
INVESTMENT AND UPCOMMING KEY PROJECTS
VERÐMÆTASTI LEIGUSAMNINGUR REGINS REGINN´S MOST VALUABLE CONTRACT MILESTONE TWO LOCATIONS IN ICELANDIC RETAIL HAFNARTORG 7.000 m 2
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