ANNUAL STATEMENT 2019 INVESTORS PRESENTATION WHAT STANDS OUT IN THE - - PowerPoint PPT Presentation

ANNUAL STATEMENT 2019

INVESTORS PRESENTATION

WHAT STANDS OUT IN THE YEAR 2019?

✓ The configuration of the company‘s lessees is the main pillar for its strength. ✓ The introduction of a new strategy has and will change the company‘s focus and appearance in the future. ✓ Extensive and good results have been achieved in dealing with the costs of properties operations and the cost of operations in the properties. ✓ Excellent results achieved in leasing. ✓ Höfðatorg and Smáralind are the large core projects with extensive future expectations. ✓ Smáralind received environmental certification BREEAM In-use first of all buildings.

KEY FIGURES

COMPARISON WITH THE YEAR 2018

REVENUES GROWTH BETWEEN YEARS

20%

(17%)

EBITDA GROWTH BETWEEN YEARS

25%

(19%)

LEASING RATIO

97.5%

(97.5%)

EBITDA RATIO OF LEASING REVENUES

72.4%

(70%)

YEALD OF INVESTMENT PROPERTIES

5.0%

(4.9%)

REAL RETURN ON EQUITY

10.6%

(8.9%)

LEVARAGE

60.9%

(62.5%)

EQUITY RATIO

31.8%

(31.6%)

GROUP‘S INVESTMENT PROPERTIES

138.0 b.ISK.

(128.7 b.ISK.)

VALUATION CHANGE

4,089 m.ISK.

( 2.921 m.ISK.)

INTEREST BEARING DEBTS

84.0 b.ISK.

(80.5 b.ISK)

Operations Profitability Economics PROFIT AFTER TAX

4,486 m.ISK.

(3,226 m.ISK.)

CARBON FOOTPRINT

(tCO2e)

⇩ 3%

USE OF ECETRICITY

(kWh)

⇩ 6%

ENVIRONMENTAL CERTIFICATIONS

(m2 of portfolio)

17%

HOT WATER

(m3)

⇩ 10%

Sustainability

FOURTH QUARTER 2019

INCOME STATEMENT

4Q 2019 4Q 2018

%Δ

Leasing revenues 2,421 2,306

5.0%

Revenues, operations in properties 145 138

5,.%

Revenues 2,566 2,444

5,0%

Operational costs of investment properties

• 498
• 466

6.9%

Operations in properties

• 240
• 235

2.1%

Operational costs of investment properties

• 738
• 701

5.3%

Administrative costs

• 116
• 99

17.2%

Operational profit before assessment change 1,712 1,644

4.1%

Operational costs versus leasing revenues 71% 71% Assessment change of investm. properties and depreciations 817 978

Operational profit 2,529 2,622

• 3.5%

Net financial expenses

• 1,321
• 1,457
• 9.3%

Profit before tax 1,208 1,165

3.7%

Income tax

• 238
• 206

Net profit for the period 970 959

1.2%

20,2% 21,5% 21,6% 19,4% 20,6%

4F-18 1F-19 2F-19 3F-19 4F-19

Operational costs of invesment properties

4,3% 5,0% 4,8% 3,9% 4,8%

4F-18 1F-19 2F-19 3F-19 4F-19

Administrative costs

2.306 2.251 2.290 2.304 2.421 1.644 1.607 1.633 1.759 1.712

Q4-18 Q1-19 Q2-19 Q3-19 Q4-19

Leasing income Operational results before assessment change

THE YEAR 2019

COMPARISON WITH 2018

2019 2018

%Δ

Leasing revenues 9,266 7,737

19.8%

Revenues, operations in properties 582 551

5.6%

Revenues 9,848 8,288

18.8%

Operational costs of investment properties

• 1,923
• 1,700

13.1%

Operations in properties

• 787
• 820
• 4.0%

Operational costs of investment properties

• 2,710
• 2,520

7.5%

Administrative costs

• 427
• 378

13.0%

Operational profit before assessment change 6,711 5,390

24.5%

Operational costs versus leasing revenues 72% 70% Assessment change of investm. properties and depreciations 4,075 2,910

Operational profit 10,786 8,300

30.0%

Net financial expenses

• 5,170
• 4,301

20.2%

Profit before tax 5,616 3,999

40.4%

Income tax

• 1.130
• 773

Profit for the period 4,486 3,226

39.1%

20,2% 21,5% 21,6% 19,4% 20,6%

4F-18 1F-19 2F-19 3F-19 4F-19

Operational costs of invesment properties

4,3% 5,0% 4,8% 3,9% 4,8%

4F-18 1F-19 2F-19 3F-19 4F-19

Administrative costs

2.306 2.251 2.290 2.304 2.421 1.644 1.607 1.633 1.759 1.712

Q4-18 Q1-19 Q2-19 Q3-19 Q4-19

Leasing income Operational results before assessment change

REGINN’S SUSTAINABILITY POLICY

RESPONSIBLE OPERATION FOR THE FUTURE

• Reginn's sustainability policy is a guiding principle in all of Reginn's activities and is based on 6 of the 17

UN World Wide Goals, those influencing Reginn's activities mostly: Environmental sustainability Social sustainability Economical sustainability

• Shared interests of investors, employees, customers and the community:
• Reduced operational risk, both financial and reputation risk
• Reduction of operating costs and lower environmental impact with better utilisation of resources and supplies
• Important in employing and retaining good staff who are familiar with the policy
• Increased customer demand for green properties
• Contributes to increased quality of life and better society
• Disclosure of non-financial aspects integrated with financial informatrion.
• Over 20 measurable objectives, already financial and environmental benefits visible:
• 6% decrease in use of electricity 2019
• 10% decrease in use of hot water 2019
• 17% of property portfolio has BREEAM certification

REGINN‘S PROPERTY PROTFOLIO

FUNCTION GROUPING AND BY SIZE

116 PROPERTIES 377.000 SQUARE METRES

33% 33% 13% 17% 5%

Retail and service Office Sport, entertainment and education Industrial and storage Hotel

REGINN‘S 10 MOST VALUABLE PROPERTIES

DIVERSIFIED AND WELL-KNOWN PROPERTIES Smáralind Katrínartún 2 & Borgartún 8-16 Egilshöll Áslandsskóli Hafnartorg Litlatún 3 Mjölnisholt 12-14 Ofanleiti 2 Hafnarstræti 83-89

40%

57%

*value og Reginn‘s property portfolio

TENNANTS AND LEASING

REGINN‘S UNIQUENESS BASED ON SOLID TENNANTS

Strong tenants characterise Reginn's clientele. The City of Reykjavik is the company's largest tenant, accounting for about 15% of rental

• income. Then comes the state with just under 10%, and Hagar, which

together with other listed companies, accounts for about 9% of Reginn's rental income in 2019. The municipalities of Hafnarfjörður, Garðabær and Akureyri account for just over 4%. Banks are behind, just over 2% of rental income in 2019. The part of the state and banks will increase with new and newly signed contracts in the coming quarters.

2,4% 4,1% 9,0% 9,8% 14,9% Banks Municipalities Listed companies State Reykjavík City 45.771 5.000 10.000 15.000 20.000 25.000 30.000 35.000 40.000 45.000 50.000 1F 2F 3F 4F

2017 2018 2019

LEASED SQ. METRES ANNUALLY

The year 2019 was characterised by very good results in the leasing and renewal of the company‘s leasing contracts. In total, new contracts (renewal 1/3) were made for about 46 th. square meters, which is an increase of 13% from the previous year, and the average length of contracts is unchanged or about 7-8 years. There is a good balance in the company's leasing business and demand for commercial properties is generally good. Consistent with Reginn's leasing ratio for the year, which was just under 98%, it is clear that utilisation of the company‘s properties is very high. It is the company's opinion that

• pportunities exist in further development of the portfolio.

= 40%

20 LARGEST SHREHOLDERS 10TH FEBRUARY 2020*

• Foreing investors about 3,6%

REPURCHASE PLAN - CLOSED

• The former repurchase plan started June 7th 2019 and

closed 30th September 2019.

• The latter repurchase plan started January 7th 2020

and closed last 27th January.

• Purchased 43,091,859 shares (2.36% of issued share

capital) or for 967 m.ISK.

FINANCIAL CALENDER

• 11th March 2020 – Annual Meeting 2020
• 13th May 2020 – Results 1Q 2020

Nr. Nafn Hlutir % 1 Pension Fund of Commerce 185,105,301 10.14% 2 Gildi Pension fund ltd. 158,866,461 8.70% 3 State pension fund 130,000,000 7.12% 4 Stefnir hf. - Investment fund 100,513,069 5.50% 5 Sigla hf. - Investment company 100,000,000 5.48% 6 Birta pension fund ltd. 86,700,743 4.75% 7 Stapi pension fund ltd. 86,135,266 4.72% 8 Eaton Vance Management 64,930,238 3.56% 9 Frjálsi pension fund 63,679,504 3.49% 10 Lífsverk - pension fund 51,404,808 2.81% 11 Söfnunarsjóður lífeyrisréttinda - pension fund 49,094,122 2.69% 12 Brimgarðar ehf. - Investment company 48,633,333 2.66% 13 Júpíter rekstrarfélag ehf. 48,261,978 2.64% 14 Festa - pension fund 47,061,245 2.58% 15 Íslandsbanki hf. 41,786,551 2.29% 16 Sjóvá - Almennar tryggingar hf.-insurance co. 40,204,307 2.20% 17 Arion banki hf. 37,570,000 2.06% 18 Landsbréf hf. - investment fund 35,441,728 1.94% 19 Landsbankinn hf. 31,082,256 1.70% 20 Íslandssjóðir hf. - investment fund 28,689,495 1.57% Total 20 largest 1,460,366,224 79.97%

*Corrected 13th February 2020

OPERATIONAL FORECAST

THE YEAR 2020

• Based on the unchanged portfolio, the company's rental revenues are estimated

to be around 9,750 m.ISK in 2020. (+/- 100 m.ISK), a 5% increase from 2019.

• At the same time, operating profit before valuation changes and depreciation is

expected to be around 7,000 m.ISK. (+/- 70 m.ISK) in 2020.

• The company’s administration costs are estimated 4.5% of leasing revenues in

the year 2020.

• Operational costs of investment properties is estimated about 21% of leasing

revenues in 2020.

ANNUAL PRESENTETION2019

THANK YOU