VVO Group plc's Interim Report 1.1- 30.9.2016
VVO GROUP PLC
STOCK EXCHANGE RELEASE
3 November, 2016 at 13.00 EET
VVO Group plc's Interim Report 1.1- 30.9.2016
SUMMARY JANUARY-SEPTEMBER 2016
SUMMARY JULY-SEPTEMBER 2016
CEO JANI NIEMINEN
In approximately five years' time, the company has invested nearly EUR 1.5 billion in market-based rental housing. In 2016, our investments in Finnish rental housing will be approximately EUR 650 million, and at the end of the review period, there were 1,415 new rental apartments under construction, of which 1,233 were in the Helsinki region. We want to respond to the demand for rental housing, particularly in the Helsinki region, making it easier for people to move around in pursuit of employment in urbanising Finland. We are actively fighting the grey economy well beyond the legislative requirements. VVO Group's share of the entire rental housing market is approximately 4.4 per cent.
VVO Group plc issued a new EUR 200 million secured bond after the review period on 17 October 2016. The transaction attracted a wide audience from investors in Fin-land, other Nordic countries and Europe and it was clearly oversubscribed, with subscriptions from over 40 investors. The bond was listed on the Nasdaq Helsinki Ltd stock exchange on 21 October 2016. The company's goal is to diversify its funding sources in order to finance growth.
As a housing investment company, our annual investment target is 1,000 rental apartments. This target can be reached, but it would be significantly easier to increase the number of rental apartments if there was a sufficient supply of plots suitable for immediate construction in growth centres. It is possible to influence the housing situation in the Helsinki Metropolitan Area and the market price of rents by increasing the amount of plots suitable for construction and by enhancing the supply.
This year, we have divested our ARA properties that are subject to long-term restrictions and focused on market-based operations, where we can develop our operations extensively and carry out service design. Our goal is to create more offering and new service solutions in rental housing in order to make it easier to acquire rental apartments and to live in them. In rental operations, we apply overall rent without any separate additional charges - a convenient approach for our customers! Nearly all of our rents include water and broadband Internet, for example. The Lumo homenow.fi online service channel, now up and running for approximately a year, revolutionised the rental housing sector and has convinced customers of its merits: more than 760 tenancy agreements have been signed through the apartment rental service.
|Net rental income, M€||55.9||57.3||172.4||170.5||227.4|
|Profit before taxes, M€||49.0||42.9||154.4||167.3||224.7|
|Earnings per share, €||5.27||4.86||16.80||18.09||24.23|
|Equity per share, €||233.93||228.57||234.85|
|Return on equity, % (ROE)||9.6||10.9||10.8|
|Return on investments, % (ROI)||7.0||7.7||7.6|
|Loan to Value, %||47.7||47.9||42.8|
|Equity ratio, %||39.5||41.2||41.1|
|Financial Occupancy rate, %||97.8||97.8||97.2||97.5||97.6|
|Gross investments, M€||519.5||44.2||609.4||159.2||235.0|
|Investment properties, M€||4,127.5||3,907.9||3,999.2|
|Interest bearing liabilities, M€||1,984.8||1,888.4||1,494.6|
|Number of personnel, end of period||290||363||356|
OUTLOOK FOR VVO GROUP
VVO Group specifies its outlook for 2016 with regard to investments.
VVO Group estimates that net rental income will remain at the 2015 level. Investments are forecast to be approximately EUR 650 million (previous estimate: over EUR 600 million). The outlook takes into account the effects of the divestment of 8,571 apartments and the acquisition of 2,274 apartments, the estimated occupancy rate for the remainder of the year and the number of apartments under construction. VVO Group's financial occupancy rate is expected to remain at the current level throughout 2016, due to continuing stable demand for rental housing. The estimate is based on currently valid tenancy agreements and the stable demand in growth centres.
VVO Group plc
Jani Nieminen, CEO, tel. 020 508 3201
Erik Hjelt, CFO, tel. 020 508 3255
VVO Group plcUnder the Lumo and VVO brands, VVO Group plc offers versatile and effortless rental solutions coupled with an extensive range of housing services for different life situations. VVO Group aims to invest heavily in increasing its housing supply by 2021 through the development of new properties and acquisition of existing properties. www.vvokonserni.fi