Technopolis Plc Interim Report Q2/2013 · Technopolis Plc Interim Report Q2/2013 . Q2/2013 Recap...
Transcript of Technopolis Plc Interim Report Q2/2013 · Technopolis Plc Interim Report Q2/2013 . Q2/2013 Recap...
Technopolis Plc
Interim Report
Q2/2013
Q2/2013 Recap
Strong growth continued
Vilnius acquisitions support 2013 growth
>4,500 sqm with avg. >5 year leases in Kuopio
Occupancy rose q/q from 92.2% to 92.7%
Lease period avg. rose y/y from 27 to 37 months
Hedging ratio rose y/y from 29.2% to 35.4%
Upgraded guidance to 14%-17% remains valid
2
Strategy Check 2013: Targets
3
Old target
2012-2016
Actual 2012 Target 2014-2016
Net sales +15% p.a. 15.6% Unchanged
EBITDA +15% p.a. 17.3% Unchanged
International net sales 50
million euros by 2016
9.8 EUR million Unchanged
ROCE >6% p.a. 5.0% EPRA Standard
Equity ratio >35% over the
cycle
Year-end 2012 36.2% Unchanged
Dividend payout 40%-50% of
net income
50.6% Dividend policy avg.
1/3 of net income
Markets Are Holding Up and Growing
Source: ´Federation of Finnish Financial Services,
Bloomberg, for Baltic countries company gathered consensus
(can be delivered by request) and Standard & Poors
Finland 2013E
GDP growth 0.1%
Unemployment 8.3%
Credit rating AAA
Sweden 2013E
GDP growth (%) 1.4%
Unemployment 8.2%
Credit rating AAA
Denmark 2013E
GDP growth (%) 0.5%
Unemployment 6.1%
Credit rating AAA
Estonia 2013E
GDP growth (%) 2.8%
Unemployment 9.5%
Credit rating AA-
Russia 2013E
GDP growth (%) 2.6%
Unemployment 5.5%
Credit rating BBB+
Latvia 2013E
GDP growth (%) 2.5%
Unemployment 13.6%
Credit rating BBB+
Lithuania 2013E
GDP growth (%) 3.0%
Unemployment 12.0%
Credit rating BBB
Norway 2013E
GDP growth (%) 2.5%
Unemployment 3.3%
Credit rating AAA
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Finland
Existing operations
in 8 cities
Sweden
No operations as of today
Germany
Denmark
No operations as of today
Poland
Lithuania
Operations in Vilnius as of May 2013
Latvia
Estonia
Existing operations in Tallinn
Russia
Existing
operations
in
St. Petersburg
Norway
No operations as of today
Key Figures
5
Financials H1/2013 H1/2012 Δ, % 2012
Net sales, EUR million 60.9 52.1 16.8 107.3
EBITDA, EUR million 30.2 25.9 16.5 55.8
Operating profit, EUR million 22.4 18.8 19.3 48.0
Direct result (EPRA), EUR million 18.5 12.5 48.2 29.9
Investments in properties, EUR million 72.1 42.6 69.3 107.2
Real Estate Operations 0.9
Financial occupancy rate, % 92.7*) 94.1 -1.4 95.3
Net rental yield, % 7.5 7.7 -0.2 7.8
Total space, 1 000 sqm 717,500 604,200 18.8 644.3
*) Effected by Peltola and Vilnius acquisition
Lease Portfolio
Long-term leases contributed to the average lease length and lease stock
At the end of the period the average lease period was 37 (27) months
Lease stock was EUR 342.2 (239.7) million
6
% of lease stock Lease length in months
0
5
10
15
20
25
30
35
40
45
0%
10%
20%
30%
40%
50%
60%
0-3 mo 3-6 mo 6-9 mo 9-12 mo Over 12 mo
H1/2012 H1/2013 LEASE LENGTH, MO
Equity and Debt - Ratios
7
Loan to Value and Equity Ratio Interest Rate and Interest Coverage Ratio
Equity ratio was boosted by EUR 75 million hybrid bond
LTV stayed under 60
Average interest rate 25 basis points down from Q2/2012
Strong operational performance boosted ICR
2,32
2,12
1,83 1,95
2,07
3,9 4
4,5
5
5,5
3
4
5
6
1,0
1,5
2,0
2,5
Q2/2012 Q3/2012 Q4/2012 Q1/2013 Q2/2013
Average interest rate Interest coverage ratio
37,3 36,9
36,2
40,1 39,3
58,2
59,5 59,5
57,5 57,8
56
57
58
59
60
61
62
63
64
35
37
39
41
Q2/2012 Q3/2012 Q4/2012 Q1/2013 Q2/2013
Equity ratio Loan to value
8
Location: Oulu, Finland
The fifth largest city in Finland
Approximately 190,000 inhabitants
Capital and business center of Northern
Finland
Peltola Acquisition
Peltola
EUR 31.7 million
Rentable space 37,600 sqm
Market yield 8.5%
Stabilized yield 11.2%
Occupancy 64.9%*, we expect it
to increase significantly by YE
Modern, flexible, good location
Up & coming life sciences sector *As of August 15, 2013
Vilnius Acquisition
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Location: Vilnius, Lithuania
Second largest city of the Baltic states
City >530,000 inhabitants, county
>800,000
University with >20,000 students
Vilnius campus
EUR 62.6 million
Rentable space 42,300 sqm
Market yield 8.2%
Stabilized yield 9.6%
Occupancy 99.8%* for
completed buildings
Prelet rate 84%* for 3rd phase
30,000 sqm expansion potential
*As of August 15, 2013
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Viestikatu 7B&C
EUR 17.4 million
Rentable space 9,300 sqm
Market yield 8.3%
Stabilized yield 9.2%
Occupancy 92.2%*
Next to hospital district and
university of applied science
Location: Kuopio, Finland
8th largest city in Finland
>100,000 inhabitants and growing
University city with healthcare and
cleantech focus
Viestikatu 7B and C Completion
*As of August 15, 2013
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Location: Tallinn, Estonia
Largest city in Estonia
> 420,000 inhabitants and growing
Capital and main business center of
Estonia
Lõõtsa 8 A,B&C
EUR 32.7 million
Rentable space 22,500 sqm
Market yield 8.3%
Stabilized yield 9.1%
C 3/2013, occupancy 94.8%
B prelet rate 100% and A 59.3%* 10-year lease with public anchor
B completion in 10/2013
A completion in 02/2014
Lõõtsa 8, Under Construction
*As of August 15, 2013
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Pulkovo 2
EUR 42.0 million
Rentable space 18,700 sqm
Market yield 10.6%
Stabilized yield 12.6%
Prelet rate 10.2%*
Estimated completion in 10/2013
Location: St. Petersburg, Russia
Second largest city in Russia
Ca. 5,000,000 inhabitants
Russian gateway to the Western Europe
and Baltic Sea
Pulkovo 2, Under Construction
*As of August 15, 2013
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Location: Jyväskylä, Finland
Ca. 133,000 inhabitants and growing
Brisk business and university city with
physics, sports and health sciences
focus
Innova 4, Under Construction
Innova 4
EUR 23.7 million
Rentable space 8,900 sqm
Market yield 7.6%
Stabilized yield 8.1%
Prelet rate 87.4%*
Downtown location
Estimated completion in 10/2013
*As of August 15, 2013
Appendices: Additional Data
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Financial Targets 2014 - 2016
• Net sales and EBITDA growth 15% on average per annum
• Net sales outside Finland over EUR 50 million by 2016
• At least 6% return on capital employed* per annum
• Equity ratio over 35% over the cycle
NEW: Dividend policy 1/3 of net profit (excluding fair value
changes and their tax effects) down from 40-50% of net profit
15
* Excluding fair value changes (formula specified)
The Board of Directors reviewed the targets April 15
Realization of Strategic Targets
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H1/2013 H1/2012 Δ, % 2012
Net sales, EUR million 60.9 52.1 16.8 107.3
EBITDA, EUR million 30.2 25.9 16.5 55.8
International operations, EUR million 6.5 4.8 34.1 9.9
Equity ratio, % 39.3 37.3 +2.0 36.2
Market Segments, June, 2013
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Markets, in sqm Markets, in fair value
Fair value y/y EUR -6.5 million
Space increased y/y 18.8
23%
18%
17%
10%
10%
3% 7%
7% 5%
Oulu
HMA
Tampere
Kuopio
Jyväskylä
Lappeenranta
St. Petersburg
Tallinn
Vilnius
32%
12%
16%
10%
8%
4%
3% 11%
4%
Oulu
HMA
Tampere
Kuopio
Jyväskylä
Lappeenranta
St. Petersburg
Tallinn
Vilnius
Customers in June, 2013
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Top 20 Customers Customer Segments
As of 30 June 2013 the 20 largest customers were renting ca. 38% of the company’s space
14%
22%
3% 7% 8%
4%
7%
11%
2%
8%
14%
Professional Services
Information andCommunication
Public Sector
Real Estate
Education
Food Services
Financial Services
Manufacturing
Healthcare
Wholesale and Retail
Other
Technopolis Investment Criteria
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Property Criteria
• Excellent location in the growth hubs and additional building rights
• Good quality, flexible assets
• > 40,000 m2
Customer Criteria
• Corporate and/or public sector and/or academic anchors
• Well balanced customer mix
Management & financial criteria
• Experienced, skilled and connected local teams
• Positive cash flow and EPS impact
Investment Pipeline
20
Area Name
Occupancy
rate, %
Aug 15,’13 sqm
EUR
million Yield, % Completion
Acquired
Tampere Tohloppi 100.0 32,000 23.3 11.8 10/2012
Oulu Peltola 64.9 37,600 31.7 11.2 02/2013
Vilnius Alfa & Beta 99.8 31,200 62.6 *) 9.6 05/2013
Completed
HMA Ruoholahti 2 96.2 8,600 27.1 7.2 06/2012
Tampere Yliopistonrinne 2 96.6 7,500 22.5 7.6 10/2012
Kuopio Viestikatu 7B&C 92.2 9,300 17.4 9.2 02/2013
Tallinn Löötsa 8C 94.8 6,200 8.3 9.1 03/2013
Under construction **)
Vilnius Gamma 84.0 11,000 62.6 *) 8.8 10/2013
Tallinn Löötsa 8A&B 80.7 8,600 12.1 9.2 10/13-02/14
***)
St. Petersburg Pulkovo 2 10.4 18,700 42.0 12.6 10/2013
Jyväskylä Innova 4 87.4 8,900 23.7 8.1 10/2013
*) total value of the Vilnius deal including all phases
**) pre-let rate August 15, 2013
***) commissioning in phases
Breakdown of Debts and Covenants
21
25%
26%
28%
3%
18%
Loans without Covenants or Bank Guarantees
Loans with Covenants (equity ratio)
Loans Requiring Bank Guarantees with Covenants
Loans Requiring Bank Guarantees without Covenants
Loans with Covenants
86,9%
5,6%
7,5% 0,0%
Bank Loan Leasing Debt
Commercial Paper Credit Limit + others
Loan Maturities
22
The Group’s loan maturities on average is 8.3 (8.8) years
Within 12 months EUR 130.5 million of loans are coming to due
EUR 131.6 (137.9) million untapped credit facilities
0,0
50,0
100,0
150,0
200,0
250,0
300,0
< 1 year 1 - 2 years 2 - 3 years 3 - 4 years 4 - 5 years over 5 years
EUR million
Repayments of interest bearing debt Maturity of credit facilities
Financing
23
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Q1/09 Q1/10 Q1/11 Q1/12 Q1/13
Floating-rate loans (0-12 months) Fixed-rate loans (> 12 months) Hedge ratio
Sustainability
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Action 1-6/2011
(base year)
1-6/2012 1-6/2013
Energy kWh/gross sqm 121.5 +1.5% -1.3%
Water m3/FTE 1.074 -5.2% -16.3%
CO2e kg/gross sqm 13.8 -55.7% -57.4%
Reporting Environmental
Sustainability Report GRI, C level
Improved GRI +
EPRA
Green Office (new) 2 9 10
LEED (new) 1 2 5
Shareholders
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Major shareholders July 30, 2013 # of shares % of shares change %
Varma Mutual Pension Insurance Company 18,177,280 23,95 0
Ilmarinen Mutual Pension Insurance Company 7,921,177 10,44 0
City of Oulu 3,655,577 4,82 0
OP-Pohjola Group 1,029,320 1,36 0,1
City of Tampere 956,649 1,26 0
Laakkonen Mikko Kalervo 875,846 1,15 0
Jyrki Hallikainen 874,078 1,15 0
The Finnish Cultural Foundation 848,602 1,12 0
Odin Finland 820,960 1,08 0
Ivvestment Fund Taaleritehdas Arvo Markka Osake 750,000 0,99 0
Kickoff Oy 701,181 0,92 0
The Finnish National Fund for Research and Development Sitra 666,036 0,88 0
City of Vantaa 600,000 0,79 0
City of Espoo 538,548 0,71 0
Mutual Fund Evli Finnish Equity 558,210 0,74 4,7
Jenny and Antti Wihuri´s Foundation 527,428 0,70 0
Lappeenrannan Kaupunkiyhtiöt Oy 511,361 0,67 0
Mutual Insurance Company Pension-Fennia 486,904 0,64 0