PRELIMINARY FINANCIAL STATEMENT Q4 2019 PRELIMINARY FINANCIAL - - PowerPoint PPT Presentation

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PRELIMINARY FINANCIAL STATEMENT Q4 2019 PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG ATRIUM LJUNGBERG IN BRIEF 13% UPPSALA Number of properties 70 72% STOCKHOLM Property value SEK 49 billion Contracted annual rent SEK 2,6

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SLIDE 1

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

PRELIMINARY FINANCIAL STATEMENT Q4 2019

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SLIDE 2

UPPSALA STOCKHOLM GÖTEBORG MALMÖ

Offices 50 %, 1 296 mkr Retail 26 %, 662 mkr FMGC 6 %, 158 mkr Restaurants 5 %, 121 mkr Culture / education 4 %, 108 mkr Healthcare 4 %, 96 mkr Other 3 %, 88 mkr Residential 2 %, 49 mkr

ATRIUM LJUNGBERG IN BRIEF

Number of properties 70 Property value SEK 49 billion Contracted annual rent SEK 2,6 billion Lettable area 1 176 000 m2 Letting rate 93 %

Contracted annual rent per premises type

13% 72% 6% 9%

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

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SLIDE 3

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

REFINEMENT OF THE PROPERTY PORTFOLIO 31/12/2009 – 31/12/2019

Reduction of retail in favour of offices

Offices 50 % Retail 26 % FMGC 6 % Restaurants 5 % Culture / education 4 % Healthcare 4 % Other 3 % Residential 2 %

2019

Offices 31 % Retail 51 % Other 14 %

2009

Stockholm 72 % Uppsala 13 % Malmö 9 % Gothenburg 6 %

2019

Stockholm 81 % Uppsala 9 % Malmö 6 % Sweden other 4 %

2009

Now only in Sweden’s four major cities

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SLIDE 4

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

STRONGLY EXPANDED PROJECT PORTFOLIO

10 000 20 000 30 000 40 000 50 000 2009-12-31 2019-12-31

SEK m

Land and development rights Development properties Propject properties Investment properties 10 000 20 000 30 000 2009-12-31 2019-12-31

SEK m

Change of detailed development plan required Detailed development plan exists Decided projects

Increased property value Increased project portfolio

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SLIDE 5

EVENTS FOURTH QUARTER 2019

  • Lease agreement with Nordic Choice for an

additional 3,000 sqm in Tapetfabriken

  • Decision to start Sickla Galleria phase IV, with

200 parking spaces and 3,000 sqm of new retail space

  • Several lettings in Sickla Front II and Curanten in

Sickla

  • Prepared the organization for the future with a

new organization and the appointment of several new positions.

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

Sickla Galleria phase IV

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SLIDE 6

AN INTENSE 2019

  • Access to 14 properties in Slakthusområdet (Meat

Packing district)

  • Sale of residential properties in Kista
  • After some delays, several major projects are now

underway, Life City and Bas Barkarby

  • Entry into the EPRA index, which have significantly

increased turnover in the share

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

Kylhuset 15 in Slakthusområdet

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SLIDE 7

RECORD VOLUME ON TRANSACTION MARKET

Transaction volume, SEK billion Dividend yield requirements for offices and 10-year government bond interest

50 100 150 200 250 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Stockholm Gothenburg Malmö Sweden Other

  • 1%

0% 1% 2% 3% 4% 5% 6% 7% 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

SE GOV 10Y Prime yield (Offices Stockholm CBD) Prime yield (Offices Gothenburg CBD) Prime yield (Offices Malmö CBD) Shopping centers

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

Source: Savills

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SLIDE 8

LOW VACANCIES KEEPING DEMAND UP

Contracted annual rent per area, SEK/m2

Source: Savills

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

1 000 2 000 3 000 4 000 5 000 6 000 7 000 8 000 9 000 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Stockholm CBD Prime Vasastaden/Norrmalm Kista Southern suburbs Södermalm Lindholmen Malmö CBD

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SLIDE 9

RETAIL SALES GREW BY 3.5 % DURING 2019

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

Retail sector’s development and forecast 1991 - 2020 (rolling prices, %)

  • 6%
  • 3%

0% 3% 6% 9% 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019

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SLIDE 10

FASHION STILL STRUGGLES

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

4,4% 4,0% 1,2% 1,0%

  • 5,3%

3,4% 3,6% 3,5%

  • 6,00%
  • 4,00%
  • 2,00%

0,00% 2,00% 4,00% 6,00%

Source: SCB (preliminary full-year development)

Retail development by industry, current prices

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SLIDE 11

RECOVERY ON THE HOUSING MARKET

Prices for tenant-owned dwellings, SEK/m2 New production for sale

10 000 20 000 30 000 40 000 50 000 60 000 70 000 80 000 90 000 100 000 2005 2007 2009 2011 2013 2015 2017 2019 Stockholm inner city Stockholm close suburbs Göteborg inner city 1 000 2 000 3 000 4 000 5 000 6 000 7 000 8 000 9 000 10 000 2015 2016 2017 2018 2019 2020 Stockholms län Västra Götalands län Skåne län Uppsala län

Queue times for new production, years

1 2 3 4 5 6 7 8 9 2001 2004 2007 2010 2013 2016 2019 Stockholm region Uppsala Malmö region

Source: Värderingsdata Source: Booli Source: Bostadsförmedlingen Stockholm, Boplats Syd and Uppsala Bostadsförmedling

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SLIDE 12
  • 80
  • 60
  • 40
  • 20

20 40 60 80 100 Investment properties Project properties Net letting

Q2 Q3

NET LETTING

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

  • Net letting during the fourth quarter SEK -8 m of which

SEK -4 m in project properties. Affected by a couple of notice of terminations in offices in Hagastaden, SEK

  • 22 m.
  • SEK -82 m for the period, of which SEK -46 m in

project properties. Katarinahuset in Slussen that is being prepared for project contributes with SEK -85 m.

Glashuset and Katarinahuset in Slussen

SEK m 2017 2018

Q4 Q4 Q2 Q1 Q3 Q2 Q1 Q3 Q1

2019

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SLIDE 13

CONSOLIDATED INCOME STATEMENT

SEK m 2019 Jan-Jun 2018 Jan-Jun Δ % Rental income 2,577 2,412 + 6.9 % Property costs*

  • 844
  • 764

+ 10.5 % Operating surplus * 1,733 1,648 + 5.2 % Central administration (property management)

  • 80
  • 73

Project- and construction work

  • 59
  • 59

Net financial items

  • 360
  • 302

Profit/loss before changes in value 1,234 1,214 + 1.7 % Change in the value of properties, unrealised 2,283 2,516 Change in the value of properties, realised 73 121 Change in the value of financial instruments

  • 139
  • 69

Profit/loss before tax 3,450 3,781 Tax

  • 643
  • 329

Profit for the period 2,807 3,453

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

*excluding effect of introduction of IFRS 16

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SLIDE 14

RENTAL INCOME AND PROPERTY COST

  • Like-for-like portfolio

– Rental income increased by 5.9% – Property cost increased by 11.1%

  • EPRA vacancy rate 6%
  • Some bad debt losses
  • New concepts
  • Property tax, increased costs and

increased surcharges

2019 1/1-31/12 2018 1/1-31/12 Δ % Like-for-like portfolio 2,223 2,099 + 5.9 % Non-recurring renum. 4 5 Project properties 184 117 Acquisitions 127 14 Sold properties 39 177 Rental income 2,577 2,412 + 6.9 %

Rental income trend (SEK m)

2019 1/1-31/12 2018 1/1-31/12 Δ % Like-for-like portfolio

  • 730
  • 657

+ 11.1 % Project properties

  • 59
  • 46

Acquisitions

  • 41
  • 9

Sold properties

  • 14
  • 52

Property cost

  • 844
  • 764

+ 10.5 %

Property cost trend (SEK m)

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

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SLIDE 15

7,0% 5,0% 5,9% Office- properties Retail- properties Residential- properties Total

STRONG INCREASE IN RENTAL INCOME LIKE-FOR-LIKE

Operating surplus and operating surplus margin Like-for-like rental income growth

50 55 60 65 70 75 50 100 150 200 250 300 350 400 450 500 Operating surplus, SEK m Operating surplus, %

Q2 Q4 Q3

SEK m %

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

2017 2018

Q4 Q4 Q2 Q1 Q3 Q2 Q1 Q3 Q1

2019

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SLIDE 16

Profit before changes in value and gearing ratio

LOWER GEARING RATIO AND DECLINING GROWTH AFTER NET SALES IN 2018 AND RECONSTRUCTION PROJECTS

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

34 36 38 40 42 44 46 48 200 400 600 800 1 000 1 200 1 400 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Profit before changes in value Gearing ratio SEK m %

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SLIDE 17

707 768 1 002 1 593 1 758 1 810 200 400 600 800 1 000 1 200 1 400 1 600 1 800 2 000 2014 2015 2016 2017 2018 2019

INVESTMENTS OF SEK 1 810 MILLION IN HELD PROPERTIES

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

SEK m

xxxxxxxxxxxxxxxxxxx Vision for Bas Barkarby in Järfälla

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SLIDE 18

INCREASE IN PROPERTY VALUES WITH 5.4% DURING THE YEAR

2019 Jan-Dec 2018 Jan-Dec Change in yield requirements

1,271 487

Change in operating net etc.

936 2,029

Building rights

76

  • Total

2,283 2,516

Unrealised changes in value, properties (SEK m)

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

Vision for Slussen

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SLIDE 19

(SEK m) 2019 31/12 2018 31/12 Investment properties 47,513 43,310 Leasehold 1 305

  • Goodwill

225 225 Other fixed assets 73 45 Derivatives 82

  • Total fixed assets

49,198 43,579 Development properties 997 891 Current assets 411 323 Liquid assets 457 335 Total current assets 1,865 1,549 Total assets 51,062 45,128

CONSOLIDATED ASSETS

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

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SLIDE 20

Bank loans 33 %, 6 742 m Direct financing 5 %, 1 030 m Green bank loans 8 %, 1 546 mkr Green bonds 29 %, 5 916 m Bonds 11 %, 2 207 m Commercial paper 14 %, 2 769 m

INCREASING SHARE OF CAPITAL MARKET FINANCING

Interest-bearing liabilities Development, financing sources 2014-2019, SEK billion

2 4 6 8 10 12 14 16 18 20 22 Bank loans Direct financing Green bank loans Green bonds Bonds Commercial paper

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

2016 2017 2018 2019 2015 2014

Q3 Q4 Q2 Q1 Q3 Q4 Q2 Q1 Q3 Q4 Q2 Q1 Q3 Q4 Q2 Q1 Q3 Q4 Q2 Q1 Q1 Q2 Q3 Q4

Secured loans correspond to 18% of total assets Green financing represents 37% of liabilities

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SLIDE 21

LOW FINANCIAL RISK AND STRONG KEY RATIOS

  • Interest-bearing liabilities of SEK 20.1 billion
  • Gearing ratio 41.7%
  • Average interest rate 1.6%
  • Fixed interest term 5.4 years
  • Capital commitment 4.3 years
  • Five Nordic banks, capital market, direct

financing

  • Commercial paper backed by secured credit

lines

  • Baa2 credit rating by Moody’s

1 2 3 4 5 6 1 2 3 4 5 6 Average interest (%) Capital committment (years) Fixed interest term (years) 2016 2017 2018 2019 2015 2014

year %

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

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SLIDE 22

FORECAST 2020

Profit before changes in value

SEK 1,200 m

(SEK 1,234 m)

Investments

SEK 2,400 m

(SEK 1,810 m)

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

A concert in Slakthusområdet

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SLIDE 23

PROPOSED DIVIDEND

SEK 5.00 per share

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

Kylhuset 15 i Slakthusområdet

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SLIDE 24

STRONG HISTORY OF INCREASING DIVIDENDS

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

0,00 0,50 1,00 1,50 2,00 2,50 3,00 3,50 4,00 4,50 5,00 5,50 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019

SEK/share

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SLIDE 25

GOAL COMPLETION 2019

ATRIUM LJUNGBERG 31/12/2019

Financial goals

Return on equity Gearing ratio Investments in held properties Dividend share Interest coverage ratio

Goal: Goal: Goal: SEK 1 billion Goal: 2 times Goal: Goal: SEK 2 billion

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SLIDE 26

GOAL COMPLETION 2019

ATRIUM LJUNGBERG 31/12/2019

Sustainability goals

Percentage of environmental certified properties Percentage of green lease contracts Reduction in energy consumption Employee index (GPTW)

Goal: Goal 2021: 188 kWh/sqm Goal 2021: Goal 2021:

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SLIDE 27

EXTENSIVE PROJECT PORTFOLIO

Remaining investment (SEK m)

Ongoing projects 3,060 Potential projects (approx.) 25,000 Total (approx.) 28,000

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

Offices 52 % Residential 34 % Retail 10 % Culture / education 5 %

Potential project area after premises type

Vision for Kylfacket 3, by the new subway station in Slakthusområdet

Land allocations 23 % Own land 77 %

Share of potential project on our own land

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SLIDE 28

23 BILLION SEK IN PROJECTS AT EXISTING OR FUTURE SUBWAY STATIONS

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

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SLIDE 29

TIME TABLE FOR CONFIRMED PROJECTS

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

2020 2021 2022 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Curanten Nobelgaraget Sickla Galleria etapp IV Tapetfabriken Mobilia torghuset Life City Bas Barkarby Gränby Entré hus 3 Parkhusen, phase 1 Forumkvarteret Panncentralen Brf Sicklastråket Planning Construction Completion

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SLIDE 30

SICKLA CURANTEN

Area 11,500 sqm Investment SEK 530 m Completed 2020 A healthcare destination

DECIDED PROJECT

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

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SLIDE 31

SICKLA TAPETFABRIKEN

Area 10,500 sqm Investment SEK 440 m Completed spring 2020 Tenant Nordic Choice Hotels, fully let

DECIDED PROJECT

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

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SLIDE 32

NOBELBERGET

68 tenant owned dwellings + garage Investment SEK 360 m Completed 2020

DECIDED PROJECT

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

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SLIDE 33

GRÄNBYSTADEN ENTRÉHUSEN, HOUSE 1, 2 AND 3

Area 17,200 sqm, 200 apartments Investment SEK 710 m Completed 2020 Residential, office, retail, restaurants

DECIDED PROJECT

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

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SLIDE 34

GRÄNBYSTADEN PARKHUSEN, PHASE 1

Area 2,800 sqm, 44 rental apartments Investment SEK 120 m Completed 2021

DECIDED PROJECT

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

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SLIDE 35

MOBILIA TORGHUSET IN MALMÖ

Area 12,900 sqm Investment SEK 540 m Completed 2020 Residential, movie theatre, retail, children’s culture

DECIDED PROJECT

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

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SLIDE 36

LIFE CITY IN HAGASTADEN, STOCKHOLM

DECIDED PROJECT

Area 27,500 sqm Investment SEK 1,840 m Completed 2022 Tenant: Academic Work 17,000 sqm

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

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SLIDE 37

BAS BARKARBY

Area 24,300 sqm Investment SEK 830 m Completed 2022 Education, culture, sports and business

DECIDED PROJECT

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

BAS BARKARBY IN JÄRFÄLLA, STOCKHOLM

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SLIDE 38

CONTACT

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

Annica Ånäs

CEO

annica.anas@al.se Atrium Ljungberg AB Box 4200 SE- 131 04 Nacka Sweden Visit: Smedjegatan 2C

Martin Lindqvist

CFO

martin.lindqvist@al.se

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SLIDE 39

PRELIMINARY FINANCIAL STATEMENT Q4 2019 ATRIUM LJUNGBERG

PRELIMINARY FINANCIAL STATEMENT Q4 2019