INTERIM FINANCIAL STATEMENT HALF YEAR 2016 Helgi S. Gunnarsson 24 - - PowerPoint PPT Presentation

Helgi S. Gunnarsson 24th August 2016

INTERIM FINANCIAL STATEMENT

HALF YEAR 2016

OPERATIONS AND RESULTS

• Reginn’s Results for the half year 2016 are good and consistent to
• perational objectives.
• INCOME for fyrst half amounted to 3.222 m. ISK.

There off leasing income amounted to 2.946 m. ISK corresponding to 26% growth compared to same period 2015.

• OPERATIONAL RESULTS before assessment change and depreciation

/ EBITDA were 2.126 m. ISK corresponding to 25% growth compared to the year 2015.

• THE RATIO „Operational Results before assessment change and

depreciation” / Leasing Income is just over 72% for the period and in accordance with the company’s objectives.

• 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.*

*) Yield is calculated as Operational Results before assessment change and depreciation /assessment

• f properties using the average values for the period.

⇧ 26% ⇧ 25% 72% ⇧ 65% 5,9%

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

Quarterly Overwiev 2Q 2016 1Q 2016

Leasing Revenues 1,555 1,391 Revenues, Operations in properties 137 139 Total Revenues 1.692 1.530 Operational costs of investement properties

• 319
• 302

Operational costs in properties

• 155
• 141

Administrative expenses

• 95
• 84

Gross profit before assessment changes 1.123 1.003 Assessment changes of investement properties 1.352 517 Results from operations 2.475 1.520

• Operations are as planned, revenues are growing and the

demand for commercial properties increases. Leasing rates are rising significanly.

• Control
• f

spending is successful, increases in the

• perational costs of investment properties are due to

increases in real estate taxes and in offset of projects.

• Income and expenses for " The Centra - collection" are fully

included in the quarter.

• The restructuring of Smáralind is above expectations, the

main objective to have H & M as an anchor store in the mall was successful.

• Accelerated restructuring progress of Smáralind will

strengthen the company's cash flow earlier than planned.

• Structural changes in the company are completed and
• perational projects on normal course. Head office has

been moved within Smáralind, Reginn’s employees are now 19.

COMPARISON OF QURTERS

• 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.

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

PROFIT VS LEASING REVENUES

REVENUES COSTS

450.000 700.000 950.000 1.200.000 1.450.000 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

Fjárhæðir í þ. kr.

Leasing revenues Profit

2012

2013

2014 2015 2016

4,0% 8,0% 12,0% 16,0% 20,0% 24,0% 28,0% (330.000) (230.000) (130.000) (30.000) Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

Hlutfall af leigutekjum Fjárhæðir í þ. kr. Operational Expenses Administrative Expenses Operational Exp. ratio Administrative Exp. ratio 2012 2013 2014 2015 2016

25.000 35.000 45.000 55.000 65.000 75.000 Q2 - 2012 Q3 - 2012 Q4 - 2012 Q1 - 2013 Q2 - 2013 Q3 - 2013 Q4 - 2013 Q1 - 2014 Q2 - 2014 Q3 - 2014 Q4 - 2014 Q1 - 2015 Q2 - 2015 Q3 - 2015 Q4 - 2015 Q1 - 2016 Q2 - 2016

Fjárfestingareignir í m.kr.

REGINN‘S INVESTMENT PROPERTIES

Fastengis-collection Centra-collection

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.

Klasi properties

• 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.

• Following the signing of contracts with H&M as an

anchor tenant in SMÁRALIND and HAFNARTORG, a new phase started in the leasing of these projects.

• Leasing of restructured spaces in Smáralind is in the final

phase.

• Leasing rates have been rising and new leases

demonstrate this.

• The proportion of office space and more expensive

properties in new contracts are more extensive now than in 2015.

LEASING PERFORMANCE

5.000 10.000 15.000 20.000 25.000 30.000 35.000 3M 6M 9M 12M

Útleigðir fermetrar (uppsafnað) Quarter

LEASED SQM ANNUALLY

2012 2013 2014 2015 2016

PUBLIC TENDERS

THE NATIONAL MUSEUM OF ICELAND TJARNARVELLIR 11

4.300 m2

THE STATE PROCECUTOR SUÐURLANDSBRAUT 4

700 m2

THE DIRECTORATE OF IMMIGRATION BÆJARHRAUN 16

1.000 m2

THE SHERIFF OF THE CAPITAL AREA HLÍÐASMÁRI 1

3.000 m2 = 10.500 m2

ADMINISTRATION OF OCCUPATIONAL SAFETY AND HEALTH DVERGSHÖFÐI 2

1.500 m2

REGINN‘S PROPERTY ALLOCATIONS

RETAIL AND SERVICE PROPERTIES has 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. OFFICE AND COMMERCIAL PROPERTIES is 32% and has increased in recent years in accordance with investment objectives. INDUSTRIAL AND STORAGE PROPERTIES percentage has increased as a result

• f

investment strategy of recent year. In total it accounts for 20% of the portfolio. HOTEL AND TURISM now accounts for about 5%

• f Reginn‘s portfolio.

SPORTS AND ENTERTAINMENT continues to decrease and is now about 12% of the total portfolio.

19% 12% 32% 20% 5% 12% PROPERTY TYPES (m2)

Retail and service properties Smáralind Retail and service properties General Retail properties Office and commercial properties Industrial and storage properties Hotels and tourism Sports and entertainment

INVESTMENT AND UPCOMMING KEY PROJECTS

VERÐMÆTASTI LEIGUSAMNINGUR REGINS 7.000 m2

HAFNARTORG TWO LOCATIONS MILESTONE IN ICELANDIC RETAIL

REGINN´S MOST VALUABLE CONTRACT

BJART FRAMUNDAN Í SMÁRALIND

• NEW STRONG BRAND NAMES IN SMÁRALIND

– Managed to obtain strong foreign retail chains to Iceland. – Impact on Icelandic retail marked will probably be extensive.

• HAGKAUP OPENS A NEW AND ELEGANT STORE

THIS AUTUMN

– At present modifications in Smáralind east space is in

• progress. Hagkaup will open an elegant store there, as
• thers.
• SMÁRABYGGÐ

– Results of years of planning and developement. – Extensive value in building rights and „customers“ instead

• f competition.

– 500-620 apartments – 13.000 m2 commercail space.

• HLÍÐASMÁRI

– The Sheriff of the Capiltal Area moves offices to Hlíðarmári 1 now in September. – Strong commecail area will be stronger.

• THE NORTH TOWER IN FULL OPERATION

– The bank Íslandsbanki mowes it‘s headquartes. – Quite strong branch of Íslandsbanki will occupy 1st floor. – World Class opens new gym on 2nd floor. – Up to 800 emploees will be stationed in the tower.

Sýslumaðurinn á höfuðborgarsvæðinu

BRIGHT FUTURE IN SMÁRALIND

SMÁRALIND 2016 - 2018

FUTURE VISION Create unique experience. Be exceptional on the market. Lead in retail, service and leisure activities . STORE COMPOSITION Retail will be a major factor of the sociaty. Changing focus on retail centres in the world. Shopping Centre → service and leisure activities centre. and a part of larger complex, APPARTMENTS, OFFICES, LEISURE, RESTAURANTS INVESTMENT / PROFITABILITY New investment in Smáralind of 1,8 – 2,3 bill. ISK according to new leassing spaces. Profitability of investment over 7%. SYSTEMATIC REFORMS FROM 2010 In management, operations and revenues with excellent results. Main objective to have H&M as an anchor retailer. The most valuavle leasing contract negotiated last July.

.

SMÁRABYGGÐ SOUTH OF SMÁRALIND

• Accepted local plan.
• Building mass - 84.000 m2.
• 500 - 620 appartments.
• Up to 13.000 m2 in retail and services

space.

• Owners
• Reginn hf. (Property hold. Smáralind)
• Smárabyggð ehf.
• Reginn has in total 34% of the building

mass.

• Construction over the next 8 years.
• Sites next to Smáralind planned at the

end of the construction period.

• Value of building rights in Reginn‘s

books at 805 m. ISK..

CITY CENTRE 2016 - 2018

HAFNARTORG H&M will be the core in the new retail and service space at

• Hafnartorg. Massive interest in retail and service spaces.

KOLAPORT – HAFNARHÚSIÐ Reginn has forwared ideas to connect the Kolaport (retail and flee market) and Hafnarhús (art museum) to Hafnartorg. REYKAVÍK CITY CENTRE The most extensicve investment

• f

the company in the future is Hafnartorg, that will be compleeted mid year 2018. The bulk of the investment will materialise in the years 2017 - 2018.

20 LARGEST STOCKHOLDERS 18TH AUGUST 2016

# Nafn Hlutir % 1 The Pension Fund of Commerce 200.388.362 12,88 2 Stefnir - ÍS 15 (a fund management company) 131.203.014 8,44 3 Sigla ehf. (investment company) 122.265.000 7,86 4 Gildi - pension fund 114.180.738 7,34 5 Stapi pension fund 88.819.956 5,71 6 The pension fund for state employees and the pension fund for nurses, A - dep. 64.400.000 4,14 7 Söfnunarsjóður lífeyrisréttinda - pension fund 52.337.947 3,37 8 Mjölnisholt ehf. 50.265.197 3,23 9 Sameinaði lífeyrissjóðurinn- pension fund 49.553.126 3,19 10 Lífsverk lífeyrissjóður (the pension fund of engineers) 44.948.142 2,89 11 Stefnir - Samval (a fund management company) 39.385.836 2,53 12 Sjóvá-Almennar tryggingar hf. (an insurance company) 33.437.221 2,15 13 Stafir lífeyrissjóður - pension fund 26.915.299 1,73 14 IS Hlutabréfasjóðurinn (a stock management fund) 24.958.792 1,60 15 Festa - pension fund 23.509.069 1,51 16 The pension fund for state employees and the pension fund for nurses, B - dep. 23.460.000 1,51 17 Arion banki hf. 22.823.052 1,47 18 Júpíter - Innlend hlutabréf (fund of Icelandic stock) 20.717.408 1,33 19 Íslandsbanki hf. 18.558.882 1,19 20 Fagfjárfestasjóðurinn IHF (investment fund) 16.756.188 1,08 Total of the 20 largest 1.168.883.229 75,15

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