Interim Report January-March 2020 JM Group 1) Revenue: SEK 15.8 - - PowerPoint PPT Presentation

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Interim Report January-March 2020 JM Group 1) Revenue: SEK 15.8 - - PowerPoint PPT Presentation

Jun 28, 2023 228 likes •577 views

Interim Report January-March 2020 JM Group 1) Revenue: SEK 15.8 billion Total assets: SEK 17.4 billion No. of building rights: 35,900 No. of employees: 2,540 6% Market Cap: SEK 12.1 billion 2) 20 % 74 % Sweden Norway Finland 1) According

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Interim Report

January-March 2020

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SLIDE 2

04/28/2020 Investor presentation / ytf 2

JM Group 1)

Revenue: SEK 15.8 billion Total assets: SEK 17.4 billion

  • No. of building rights: 35,900
  • No. of employees: 2,540

Market Cap: SEK 12.1 billion 2)

Norway Sweden Finland

1) According to segment reporting 2) SEK 174 per share, April 27, 2020

74 % 20 % 6%

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SLIDE 3

Group Summary 1)

  • Revenue increased to SEK 3,814m (3,669) and operating

profit increased to SEK 483m (313) 2).The operating margin increased to 12.7 percent (8.5)

  • Revenue excluding JM Construction, Business area

Construction (under closure), amounted to SEK 3,768m (3,719), the operating profit to SEK 491m (506) and the

  • perating margin to 13.0 percent (13.6)
  • Gains from sale of properties and operations

SEK 18m (38).

2 4 6 8 10 12 14 16 18 20 500 1 000 1 500 2 000 2 500 2016 2017 2018 2019 April/March 2019/2020 % SEK m Operating profit Operating margin

04/28/2020 Investor presentation / ytf 3

J A N U A RY – M A RC H 2 0 2 0

1) According to segment reporting 2)The profit included a one-off cost for the discontinuation of the housing

  • perations (Business area Construction) in JM Construction of SEK -180m

reported during Q1 2019.

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SLIDE 4

Group Summary 1)

  • Profit before tax increased to

SEK 462m (291)

  • Earnings per share increased to

SEK 5.20 (3.30)

  • Return on equity amounted to

23.3 percent (18.4)

  • Cash flow from operations was

SEK 188m (468)

04/28/2020 Investor presentation / ytf 4

J A N U A RY – M A RC H 2 0 2 0

1) According to segment reporting

Bekkeskogen tr 1, Tønsberg,, Norway 6 single-family homes Ikon, Linköping 63 residential units

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Group Summary

  • Number of residential units sold

increased to 805 (667)

  • Number of housing starts increased

to 637 (406)

  • Residential building rights portfolio

35,900 (36,400)

  • COVID-19 creates caution from

customers

04/28/2020 Investor presentation / ytf 5

J A N U A RY – M A RC H 2 0 2 0

Rörviksbacke, Årsta, Stockholm 129 residential units

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SLIDE 6

Operating profit

According to segment reporting, SEK m January – March 2020 2019 JM Residential Stockholm

250 229

JM Residential Sweden

166 180

JM International

51 98

JM Property Development

3 6

JM Construction

22

  • 189

Group-wide expenses

  • 9
  • 11

Total

483 313

Of which sale of properties 18 38

04/28/2020 Investor presentation / ytf 6

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SLIDE 7

Stable development in the first quarter

  • The housing market in Stockholm continued to improve during most
  • f the first quarter.
  • The rest of Sweden showed good profitability with good sales and level
  • f housing starts in a market that continues to be stable.
  • Increased transaction volume and decreased supply of newly produced

residential units in Sweden during the first quarter.

  • In Norway, activity level in the housing market was good with

somewhat increased prices during the first quarter. The market has become more cautious towards the end of the quarter. In Finland, the housing market was stable until the COVID-19 problems were accentuated at the end of the quarter.

  • Customers on all markets have become more cautious since the end
  • f March due to COVID-19.
  • The percentage of sold/reserved residential units in relation

to ongoing production 69 % (61), with an interval of 60-65 percent considered normal.

  • JM’s strategy for bridging the acute COVID-19 period is to safeguard

cash flows and production capacity.

04/28/2020 7 Investor presentation / ytf

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SLIDE 8

04/28/2020 Investor presentation / ytf 8

Prices on the existing home market

10 000 20 000 30 000 40 000 50 000 60 000 70 000 80 000 90 000 100 000 Q1 2011 Q1 2012 Q1 2013 Q1 2014 Q1 2015 Q1 2016 Q1 2017 Q1 2018 Q1 2019 Q1 2020 Stockholm Inner city Stockholm Nearby suburbs Gothenburg Malmö

Tenant-owned apartment prices in cities, existing home market Q1 2011 – Q1 2020

SEK/sq.m.

Source: Mäklarstatistik and WSP

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04/28/2020 Investor presentation / ytf 9

Higher level of residential units sold

117 238 347 244 243 300 119 186 158 734 882 673 841 576 829 376 851 1,120 917 1,084 695 1,015 376 200 400 600 800 1 000 1 200 1 400 1 600 1 800 2018 2019 2020 2018 2019 2020 2018 2019 2020 2018 2019 2020 Number

  • f units

JM Residential Stockholm JM Residential Sweden JM International Q1 Q2 - Q4 JM Property Development

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04/28/2020 Investor presentation / ytf 10

Higher level of housing starts

215 89 240 286 271 261 69 46 136 642 900 757 824 846 996 320 143 857 989 1,043 1,095 915 1,042 320 143 200 400 600 800 1 000 1 200 1 400 1 600 1 800 2 000 2018 2019 2020 2018 2019 2020 2018 2019 2020 2018 2019 2020 JM Residential Stockholm JM Residential Sweden JM International JM Property Development Number

  • f units

Q1 Q2 - Q4

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SLIDE 11

Number of housing starts Q1 2020 70 Completed in 2022

04/28/2020 Investor presentation / ytf 11

Strandkanten, Masugnen

B RO M M A , S TO C K H O L M

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SLIDE 12

Number of housing starts Q1 2020 105 Completed in 2022

04/28/2020 Investor presentation / ytf 12

Operan och Operetten

M A L M Ö

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Entréen Urban

Number of housing starts Q1 2020 94 Completed in 2021

LØ R E N S KO G , N O RG E

04/28/2020 Investor presentation / ytf 13

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04/28/2020 Investor presentation / ytf 14

Average number of housing starts per phase, units in apartment blocks

60 52 45 53 20 40 60 80 100 120 140 160 Stockholm Sweden International Average value, total Number

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SLIDE 15

0% 20% 40% 60% 80% 100% 1 000 2 000 3 000 4 000 5 000 6 000 7 000 8 000 9 000 10 000 Q1 2015 Q2 Q3 2015 Q4 Q1 2016 Q2 Q3 2016 Q4 Q1 2017 Q2 Q3 2017 Q4 Q1 2018 Q2 Q3 2018 Q4 Q1 2019 Q2 Q3 2019 Q4 Q1 2020

04/28/2020 Investor presentation / ytf 15

7,583 1) residential units in current production

P E RC E N TAG E S O L D / R E S E RV E D I M P L I C AT E S N O R M A L R I S K I N C U R R E N T P RO D U C T I O N I N Q 1 2 0 2 0 Number Percentage of sold/reserved in current production, Group (%) JM International JM Residential Sweden JM Residential Stockholm Normal level sold/reserved (%) Total

1) Including 600 rental and residential care units within JM Property Development – not included in percentage sold/reserved

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04/28/2020 Investor presentation / ytf 16

Residential units in current production

March 31 2020 March 31 2019 Dec 31 2019 Number of residential units 1) 7,583 7,842 7,813 Number of residential units sold 3,772 3,952 3,798 Number of residential units reserved 1,028 457 906 Sold residential units, % 54 55 53 Reserved residential units, % 15 6 12 Sold/reserved residential units, % 69 61 65 Completed production, no. of unsold units 2) 193 107 157 Number of unsold units in the balance sheet 108 89 82

1) Including rental and residential care units within

JM Property Development – not included in percentage sold/reserved 600 593 600

2) After final occupancy according to plan

J M G RO U P

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JM Residential Stockholm

04/28/2020 Investor presentation / ytf 17

January - March Full Y ear SEK m 2020 2019 2019 Revenue 1,622 1,435 5,575 Operating profit 1) 250 229 916 Operating margin, % 15.4 16.0 16.4 Number of available building rights 12,900 13,400 12,800 Number of residential units in current production 3,035 3,042 3,171

1) Of which property sales

  • The housing market continued to improve during most of the first quarter.

The willingness to sign a contract early in the process was at a normal level

  • Positive sales development with 347 residential units sold in the first quarter

compared to 238 residential units in the same period the previous year

  • Current projects with completion in 2020 have a high sales rate – supports profitability

and cash flow

  • Cash flow is in balance taking into consideration the reduction in development properties
  • The market has become more cautious since the end of the quarter due to COVID-19

Fredsborgsdalen, Österåker 34 townhouses

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SLIDE 18

JM Residential Sweden

04/28/2020 Investor presentation / ytf 18

  • Stable demand with good sales
  • The willingness to sign a contract early in the process was at a normal level
  • Good level of profitability
  • Current projects with completion in 2020 have a high sales rate – supports

profitability and cash flow

  • Cash flow is burdened by a temporary increase in working capital
  • The market has become more cautious since the end of the quarter due to

COVID-19

January - March Full Y ear SEK m 2020 2019 2019 Revenue 1,050 1,110 4,468 Operating profit 1) 166 180 719 Operating margin, % 15.8 16.2 16.1 Number of available building rights 10,500 10,500 10,500 Number of residential units in current production 1,930 2,547 1,994

1) Of which property sales

  • Tornträdgården 3, Uppsala 59 residential units
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JM International

04/28/2020 Investor presentation / ytf 19

  • Good level of activity in Norway with slightly increased prices and stable

housing market in Finland

  • Decreased profit and margin – profit from property sales during first quarter 2019
  • f SEK 38m
  • Current projects with completion in 2020 have a high sales rate – supports

profitability and cash flow

  • Cash flow is burdened by investments in development properties and a slight increase

in working capital

  • The market has become more cautious since the end of the quarter due to COVID-19

January - March Full Y ear SEK m 2020 2019 2019 Revenue 882 860 4,021

  • f which JM Norway

674 721 3,186

Operating profit 1) 51 98 355

  • f which JM Norway

41 89 298

Operating margin, % 5.8 11.4 8.8

  • f which JM Norway

6.1 12.3 9.4

Number of available building rights 11,600 11,700 11,800 Number of residential units in current production 2,018 1,660 2,048

1) Of which property sales

  • 38

38

Entréen, Lørenskog, Norway 94 residential units

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JM Property Development

04/28/2020 Investor presentation / ytf 20

  • Two completed rental projects in JM’s balance sheet

‐ Tjärtunnan, Stureby, 187 apartments ‐ Alphyddan, Nacka, 93 student apartments

  • Ongoing production in three rental projects in JM’s balance sheet

‐ Alba Lilium, Bredäng, 137 apartments ‐ Manegen, Täby Park, Täby, 128 apartments ‐ Havreflingan, Järfälla, 192 apartments

  • 600 rental units and residential care units in current production

January - March Full Y ear SEK m 2020 2019 2019 Revenue 35 24 227 Operating profit 3 6 194 Number of available building rights 900 800 800 Number of residential units in current production 600 593 600

1) Of which property sales

  • 170

Rental project Valla Park, Sundbyberg

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JM Construction

04/28/2020 Investor presentation / ytf 21

  • Good demand in the civil engineering market in Stockholm
  • Revenue excluding Business area Construction decreased due to lower

activity in the civil engineering operations

  • Operating profit in Q1 2019 of –189m was primarily due to the

discontinuation of the housing operations

  • Some project risks will remain until ongoing projects within the housing
  • perations are completed
  • Cash flow is burdened by a increase in working capital

January - March Full Y ear SEK m 2020 2019 2019 Revenue 1) 296 312 1,691

  • f which Business area Construction

46

  • 50

254

Operating profit 2) 22

  • 189
  • 141
  • f which Business area Construction
  • 8
  • 193
  • 235

Operating margin, % 7.4

  • 60.6
  • 8.3
  • f which Business area Construction
  • 17.4
  • 92.5

1) Of which internal

71 72 290

2) Of which sale of properties and operations

  • 68
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SLIDE 22

Available building rights portfolio

  • No. of building rights 1)

Region 03/31/2020 03/31/2019 Stockholm

13,800

2)

14,200 2)

Malmö/Lund

2,900 2,900

Gothenburg 3)

3,700 3,700

Uppsala 4)

3,900 3,900

Norway

7,400 8,200

Helsinki

4,200 3,500

Total

35,900 36,400

04/28/2020 Investor presentation / ytf 22

1) Rounded to the nearest hundred 2) Of which 900 and 800 building rights for rental units and residential care units 3) West region 4) East region

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SLIDE 23

Jan-Mar SEK m 2017 2018 2019 2020 Opening balance 7,121 7,543 8,306 8,938 Additions 2,017 2,402 1,745 273 Subtractions

  • 1,595
  • 1,639
  • 1,113
  • 617

Closing balance 7,543 8,306 8,938 8,594

04/28/2020 Investor presentation / ytf 23

Decreased level of development properties

B U I L D I N G R I G H T S I N B A L A N C E S H E E T

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04/28/2020 Investor presentation / ytf 24

6 years production in Balance Sheet

  • No. of residential building rights

03/31/2020 In Balance Sheet Housing starts

1)

Average period, years

2)

JM Residential Stockholm

7,700 1,140 6.8

JM Residential Sweden

6,800 1,085 6.3

JM International

6,500 1,132 5.7

JM Property Development

100 143 0.7

Group

21,100 3,500 6.0

1)

12 month period

2)

Guideline value 5 years

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04/28/2020 Investor presentation / ytf 25

Project properties

Carrying amount, SEK m 03/31/2020 03/31/2019 12/31/2019 Properties under development

901 912

801 Fully developed rental unit properties 1)

587 820

587 Fully developed commercial properties

10 11

11 Total

1,498 1,743

1,399

1) Tjärtunnan, Stureby, 187 apartments

Alphyddan, Nacka, 93 student apartments

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04/28/2020 Investor presentation / ytf 26

108 unsold residential units in Balance Sheet, SEK 438m

434 296 422 366 438 100 200 300 400 500 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020

SEK m

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04/28/2020 Investor presentation / ytf 27

Cash flow

Cash flow statement, SEK m Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 From operating activities 1) 2) 3) 468

  • 97

446 474 188 From investing activities 2

  • 1
  • 6
  • 2
  • 1

From financing activities

  • 9
  • 888

349

  • 28

105 Total cash flow for the quarter 461

  • 986

789 444 292 Cash and cash equivalents end of period 2,150 1,168 1,955 2,397 2,684

1)

Of which net investment project properties

  • 107
  • 122

779

  • 111
  • 100

2)

Of which net investment development properties

  • 83
  • 274
  • 306

123 144

3)

Of which taxes paid

  • 131
  • 141
  • 94
  • 67
  • 165

According to segment reporting

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SLIDE 28

Strong financial position and liquidity

420

  • 1
  • 0,5

0,5 1 1,5

  • 1 000
  • 500

500 1 000 1 500 2016 2017 2018 2019 Jan-Mar 2020 Net interest-bearing liability(+)/receivable(-) Debt/equity ratio

  • Equity/Assets ratio 1) 43 percent (40)
  • Available liquidity was SEK 5,484m (4,950)
  • f which cash and cash equivalents

SEK 2,684m (2,150)

  • Unutilized overdraft facilities and credit lines

SEK 2,800m (2,800)

  • Credit lines of SEK 2,400m have an average

maturity of 3.1 years (3.8)

04/28/2020 Investor presentation / ytf 28

SEK m times

1) According to segment reporting 2) Non interest-bearing liabilities for completed property

acquisitions amounted to SEK 843m (1,494)

Net interest-bearing liability(+)/receivable(-) 1)

2)

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SLIDE 29

Net financial items

January – March SEK m 2020 2019 Financial income 2 1 Financial income 2 1 Interest expenses

  • 16
  • 14

Interest expense pensions

  • 7
  • 9

Financial expenses

  • 23
  • 23

Net financial items

  • 21
  • 22

04/28/2020 Investor presentation / ytf 29

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04/28/2020 Investor presentation / ytf 30

Components of profit/loss – housing business

P E RC E N TA G E O F C O M P L E T I O N M E T H O D ( G RO S S ) Q 1 2 0 2 0 ( Q 4 2 0 1 9 ) Cost-based effect SEK 345m (424) Revaluation effect SEK 146m (255)

+ + =

Profit/loss for the period SEK 669m (771) Sales effect SEK 178m (92) Recognized expenses × contribution margin (for the current period) Changed assessment about forecast total contribution margin and/or total cost of a project that involves revaluation of recognized profit/loss from earlier periods Change in the relationship between stage of completion and sales rate in a period (incoming – outgoing) (Adjustment of accumulated profit for unsold residential units) Always positive Usually positive Positive/negative

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SLIDE 31

04/28/2020 Investor presentation / ytf 31

Revaluation effects – housing business

SEKm

Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020

Group

184 143 198 255 146

Business segment Stockholm Sweden International Total

Q4 2019 17 161 77 255 Q1 2020

  • 30

135 41 146

The net of positive and negative revaluation effects in residential projects during Q1 2020 totaled SEK 146m, with current assessment of market conditions for the actual forecast period.

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JM today

04/28/2020 Investor presentation / ytf 32

Customer focused – strong brand 35,900 building rights in attractive locations Fundamentally favorable prospects COVID-19 creates caution The geographic scope is gradually expanding Sustainable urban planning Efficient management system Investments in digital support Strong balance sheet – offers freedom of action Well balanced risk profile

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SLIDE 33

History is made in

  • ur homes