Q3 – Sustained growth in value and profit! Manage, refurbish and develop residential properties 1
HIGHLIGHTS Q3 2016 • Sustained pace in refurbishment despite of summer season, 289 apartments in Q3, and 1,173 for the last 12 month • Heavy investments in existing properties amounting to SEK 686 million during the first nine month of the year • Reduced costs, increased rent levels and successful cash management resulting in a 92 percent uplift in the income from property management • Before tax profit of SEK 434m in Q3 and SEK 1,200m first nine months • EPRA NAV up 7% in the quarter to 91.26 per share • Blackstone* new largest owner * Blackstone Real Estate Partners Europe IV and Blackstone Real Estate Partners VIII, through Vega Holdco S.à.r.l. 2
STRONG GROWTH IN RENTAL INCOME AND NET OPERATING INCOME Rental income growth – 7.8% (YOY) Net operating income growth – 15.7% (YOY) 350 60% 332.8 308.8 55% 300 240.0 50% 250 45% 189.9 200 SEKm 164.2 40% 150 35% 121.6 100 30% 50 25% 0 20% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2014 2015 2016 Rental income Net operating income Gross margin Gross margin - target 3
RAPID GROWTH: +51% (YOY) IN ADJUSTED EQUITY (EPRA/NAV) PER SHARE IN Q3 2016 – EQUITY RATIO OVER 30% TARGET 100 35% 91.26 90 30% Equity (EPRA NAV) SEK per share 80 25% 70 60.53 60 Equity ratio 20% 48.61 50 15% 40 30 10% 20 5% 10 0 0% Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2014 2015 2016 Equity (EPRA NAV) per share Equity ratio Equity ratio - target 4
STEADY GROWTH: EARNINGS CAPACITY +17% FOR COMPARABLE PORTFOLIO IN 2015 Current 1,600 Comparable portfolio portfolio 1,365.8 1,400 1,281.6 1,230.6 1,200 1,000 SEKm 800 695.8 651.8 600.2 600 383.7 350.6 400 298.9 200 0 Sep 30 Jan 1 March 31 June 30 Sep 30 Sep 30 2015 2016 2016 Rental income Net operating income Income from property management 5
INCREASED REFURBISHMENT PACE: 1 173 LAST 12 MONTH 400 12% 350 10% Refurbished apartments (no. Of) 289 300 8% 250 200 6% 150 4% 100 2% 40 50 0 0% Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2015 2016 Refurbished apartments per quarter Refurbished apartments (total, %) 6
REFURBISHMENTS DRIVING RAPID GROWTH IN RENTAL INCOME 116 114 Rent development, index 100 (%) 112 110 108 106 104 102 100 Jan Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2014 2015 2016 Rent development public housing Rent development DCAR 7
STEADY DEGEARING AND HIGHER ICR A RESULT OF INCREASED PORTFOLIO VALUE, LOWER FINANCING COSTS AND INCREASED OPERATING INCOME 4.0 70% 3.8 3.5 60% 3.0 50% 2.5 2.5 40% LTV (%) ICR (x) 2.0 1.6 30% 1.5 20% 1.0 10% 0.5 0.0 0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2014 2015 2016 ICR LTV LTV - target ICR – Interest Coverage Ratio LTV – Loan To Value 8
OVER 100% VALUE RETURN ON INVESTMENTS 4,500 4,065 4,000 3,500 3,000 2,500 SEKm 2,000 1,823 1,798 1,500 1,343 1,000 686 657 491 444 500 217 165 0 FY2014 FY2015 2015-9M 2016-9M FY2014-2016-Q3 Investments in existing properties Changes in value of investment properties 9
BLACKSTONE NEW LARGEST SHAREHOLDER • Blackstone* currently owns 32% of the shares and 40% of the votes • Controls 53% of the voting rights through agreement with Kvalitena AB and Frasdale Int. BV • Blackstone has submitted a bid for all shares at SEK 100 per share • Blackstone is a global leader in real estate investing with over $100 billion in capital under management • Unchanged business strategy for D. Carnegie & Co *Blackstone Real Estate Partners Europe IV and Blackstone Real Estate Partners VIII, through Vega Holdco S.à.r.l. 10
BRIGHT OUTLOOK FOR 2017 • New strong main shareholder • Strong focus on growth – New acquisitions – Continued high level of refurbishment – Development of building rights – Preparation for possible start of production of new residential buildings – Continued focus on co-op conversions after successful trial in Q2 11
THANK YOU! CONTACT: ULF NILSSON, CEO, 08-121 317 25 ULF.NILSSON@DCARNEGIE.SE D. Carnegie & Co AB Strandvägen 5A 114 51 Stockholm www.dcarnegie.se
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