Eik fasteignafélag hf.: Financial Statements 2023
Main results from the Company’s financial statement of
the year 2023:
- Income from operations for the year amounted to ISK 11,224
millon.
- Thereof revenue from lease income amounted to 9,514
million.
- Operating profit before changes in value and depreciation
amounted to 7,475 million.
- Total comprehensive income amounted to ISK 7,279 million.
- Net cash provided by operating activities amounted to ISK 4,083
million.
- The book value of investment properties amounted ISK 132,106
million at the end of the period
- The book value of assets for own use amounted to ISK 5,975
million at the end of the period.
- Changes in value of investment properties amounted to ISK 7,513
million.
- Revaluation of assets for own use amounted to ISK 1,784
million.
- Cash equivalents amounted to ISK 984 milllion at the end
of the period.
- Interest-bearing debt amounted to ISK 75,567 million at the end
of the period.
- Equity ratio was 34.6%.
- Profit per share was ISK 1.71.
- Economic occupancy rate was 94.3% at the end of the
period.
- Weighted indexed interest rates were 3.12% at the end of the
period.
- Weighted unindexed interest rates were 9.63% at the end of the
period
- The loan-to-value ratio (net loss-bearing debt / value of real
estate, building permits and plots) was 54.8% at the end of the
period.
- The Board of Directors proposes a dividend payment of ISK 2,540
million
The financial statements of Eik fasteignafélag were approved by
the Company’s Board of Directors and CEO on 15 February 2024.
Attached is an interim financial report which contains Condensed
Consolidated Financial Statements for the year 2023 together with
further information on the Company’s operations than are included
in the announcement.
In case of any discrepancy in the English and the Icelandic
versions of this announcement or the Financial Statements, the
Icelandic version shall prevail.
Operation of the year
The Company's operations went well in 2023 and the profit of the
year exceeded the Company's initial expectations despite that the
year was characterized by demanding challenges.
The Company's operating revenues amounted to ISK 11.224 million
in 2023. Of that, rental income was ISK 9.514 million. Operating
expenses amounted to ISK 3.924 million and the reversal of
previously recognized impairment losses on trade receivables
resulted in a positive impairment reversal of ISK 175 million.
Operating profit before changes in fair value and depreciation
amounted to ISK 7.475 million and increased by about 13% between
years. Profit before income tax amounted to ISK 7.318 million, net
profit amounted to ISK 5.853 million. Other comprehensive income
amounted to ISK 1.427 million. The Company's total comprehensive
income for 2023 amounted to ISK 7.279 million.
One-time items had an unusually large impact on the company's
EBITDA in 2023. Reversal of doubtful accounts provision had a
positive impact of ISK 195 million. Cost that inncured due to
takeover bid, merger discussion and other items had negative impact
of ISK 53 million. The Radisson Hotel Group, the operator of Hotel
1919, estimated that the earthquakes on the Reykjanes and the
uncertainty associated with them had about ISK 40 million negative
impact on the last six weeks of the year and the company granted a
discount on rent of ISK 28 million. due to the overhaul of one of
the company's properties. Adjusted for one-time items, operating
profit before valuation changes and depreciation amounted to ISK
7,400 million. during the year.
The Net Operating Income (NOI) ratio (i.e. operating profit
before changes in value and depreciation correct for one time items
as a ratio of lease income) was 74.6% for the year 2023, compared
to 74.1% for the year 2022.
Balance sheet
Total assets of the Company amounted to ISK 141,629 million as
at 31 December 2023, whereof investment properties amounted to ISK
132,106 million, assets for own use ISK 5,975 million and
development properties ISK 1.079 million. The Company’s equity at
year end 2023 amounted to ISK 49,023 million and equity ratio was
34.6%. The Company’s Annual General Meeting on 30 March 2023
approved an ISK 2,00 million payment of dividend to shareholders
for the operating year 2022 and it was paid on 12 April 2023.
The Company’s total liabilities amounted to ISK 92.606 million
as at 30 December 2023, of which interest-bearing debt was ISK
75.567 million and deferred tax liability ISK 12.648 million. The
loan-to-value ratio (net loss-bearing debt / value of real estate,
building permits and plots) was 54.8% at the end of the period.
Company Portfolio
In the fourth quarter the Company acquired 820 square meters of
office and retail space at Hafnarstræti 7, 101 Reykjavík. Following
the purchase, the Company owns the entire area bounded by
Pósthússtræti 2, Tryggvagötu 24-28, and Hafnarstræti 5-9. Earlier
in the year, the Company had acquired Ármúli 2 and a portion of
Síðumúli 20-22.
Proposal for payment of dividend
The policy of the Board of Directors is to pay the shareholders
up to 50% of net cash provided by operating activities less the
amount used for repurchasing of own shares up until the call for
the Annual General Meeting. The Board of Directors proposes a
dividend payment of ISK 2,540 million to shareholders for the
operating year 2023, taking into account the Company’s dividend
policy and considering the historically low loan-to-value ratio.
The proposal will be submitted at the annual general meeting which
is planned on 11 April 2024.
Outlook
According to the financial budget for 2024, the Company
estimates that its operating revenues will be in the range of
11,250 – 11,710 million ISK at a fixed price level based on the
consumer price index in January 2024. The Company also estimates
that its EBITDA for the year will be in the range of 7,250 – 7,560
million ISK.
Rentals have been successful so far this year. New leases have
been signed for approx. 4,500 sq.m. of non-revenue generating
spaces that become revenue generating as the year progresses.
The Company sees significant opportunities in its asset
portfolio, and by investing in its development, the Company can
unlock considerable value for its shareholders, both in the form of
higher rental income and the realization of the value of
development assets. On that basis, the Company's management
believes that there is potential for increased profitability.
Further discussion of the Company's financial plan for 2024, as
well as its outlook for the future, can be found in the attached
Annual Report.
Briefing session
An open briefing sessionfor market participants will be held on
Friday 16 February 2024 at 8:30 AM at Hilton Reykjavík Nordica,
Suðurlandsbraut 2, second floor. A light breakfast will be served
from 8:00 AM. Garðar Hannes Friðjónsson CEO and Lýður H. Gunnarsson
CFO will present the results and respond to questions following the
presentation.
A live stream from the session and registration for the
electronic presentation is here:
https://vimeo.com/event/4092938/a5ea76e65a
Following registration, participants will receive an e-mail with
further information.
Market participants can send questions before or during the
meeting to the e-mail address fjarfestatengsl@eik.is. Management
encourages marketers to submit questions prior to the meeting so
that answers can be prepared, if needed. Questions will be answered
after the presentation.
Financial Calendar
Following are planned dates for publishing of interim and annual
results:
Annual General
Meeting
11 April 2024
Quarterly results Q1 2024
2 May 2024
Quarterly results Q2
2024
15
August 2024
Quarterly results Q3 2024
31
October 2024
2024 Annual
Results 13
February 2025
Announcements of financial information will be published after
closing of markets.
Further information will be provided by:
Garðar Hannes Friðjónsson CEO, gardar@eik.is, tel.
590-2200
Lýður H. Gunnarsson CFO, lydur@eik.is, tel. 820-8980
- Eik fasteignafélag - Condensed Consolidated Financial Statement
2023
Eik Fasteignafelag Hf (LSE:0R70)
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