Annehem Fastigheter : Interim Report Januari-March 2022

Interim report January-March 2022

Strong first quarter

January-March

• • Rent revenue for the period amounted to SEK 50.5 million (45.1)

• • Net operating income amounted to SEK 41.4 million (37.2)

• • Income from property management amounted to SEK 20.3 million

  (19.3)

• • Earnings per share amounted to SEK 2.68 (0.69).

• • Long-term net asset value per share amounted to SEK 44.4 (37.4).

• • Investments in existing properties amounted to SEK 4.6 million

  (22.5)

• • The fair value of investment properties amounted to SEK 4,160.3

  million (3,406.1).

  Valuations of investment properties yielded an increase in fair

  value of SEK 142.6 million (29.6)

Net operating income

Jan- Mar 2022

SEK

41.4million

Property value 31 March 2022

SEK4,160million

Q1

Economic occupancy rate

31 March 2022

95%

Summary of the Group's performance
jan-mar
Mkr	2022	2021	2021
Hyresintäkter	50,5	45,1	187,8
Driftnetto	41,4	37,2	155,8
Förvaltningsresultat	20,3	19,3	86,2
Förvaltningsresultat exkl. jämförelsestörande poster	20,3	19,3	86,2
Förvaltningsresultat exkl. jämförelsestörande poster per aktie, kr	0,34	0,33	1,46
Periodens resultat	158,3	40,8	209,7
Periodens resultat per aktie, kr	2,68	0,69	3,56
Nettobelåningsgrad, %	36,5	33,2	38,3
Soliditet, %	53,9	54,4	53,9
Räntetäckningsgrad, ggr	2,7	2,6	3,0
Räntetäckningsgrad exkl. jämförelsestörande poster, ggr	2,7	2,6	3,0
Ekonomisk uthyrningsgrad, %	95,1	94,9	93,0
Avkastning på eget kapital, %	6,5	1,9	9,2
Överskottsgrad, %	81,9	82,4	83,0

helår

CEO's comments

The world is not what it was three months ago

When we thought that the worst, in the form of the impact of the pandemic on our society, was over the political security landscape was radically redrawn. Russia's invasion in Ukraine has created waves of refugees and human suffering. The sanctions imposed have pushed up the prices of energy, materials and food, among other commodities, increasing inflation to levels we have not experienced for 30 years. One consequence of this is a rapid rise in long-term interest rates. The long bond yield has increased by approximately 150 base points since during the year. Annehem extended its interest rate hedging for a large share of its borrowing in December 2021 and now has fixed-interest period of 3.2 years.

Despite developments, the activity in the transaction market remains high, which entails that the return requirements for the type of properties that Annehem owns have declined somewhat compared with the preceding quarter.

Our foundation remains stable

We are seeing a continued high demand for modern, flexible and environmentally compatible offices. The office is a meeting place where a sense of collectiveness is established and where people develop by sharing experiences. Well-being and security are placed at the centre and the importance of shared spaces for creative meetings is increasing.

Jörgen Lundgren, CEO

Strong financial position

On 31 March, we had cash of SEK 290.0 million and an unutilised credit framework of SEK 345.0 million, totalling SEK 635.0 million. We have signed agreements for the acquisition of a fully rented logistics property in Södertälje, and two housing projects, of which one in Malmö and one in Gothenburg, entailing a total investment of SEK 481.5 million. The current credit agreement gives a total acquisition capacity of approximately SEK 1.6 billion.

Imminent challenges

Globalisation and the uncertain situation in world, which we find ourselves, which is resulting in the availability of a number of essential construction commodities, which leads to increased prices and longer delivery times. This affects tenant-specific modifications and projects related to new production. Overall, this means that we see that the potential for in general lower return requirements has reduced.

However, a high inflation entails that we will to a great extent be compensated through the indexation that applies to the vast majority of our leases.

Positive trend in the first quarter

Quarters one and four are usually charged with higher operating costs related to low temperatures and snow. Despite the higher electricity prices, net operating income was in line with the first quarter of 2021. The economic occupancy rate was 95.1 percent at the end of the first quarter compared with 93.0 percent in the fourth quarter. The real estate value as per March 31st 2022 amounted to SEK 4,160.3 million, out of which 142.6 millions in value increase, the equivalent of 3.6 percent, driven primarily by lower return requirements and a higher net letting.

Value-generating sustainability work

Annehem has initiated an external analysis of the Company's sustainability work with the help of CICERO Shades of Green. The outcome of the analysis was deemed to be very positive, entailing that Annehem will apply to Nasdaq for Designation Green Equity, a so-called green share. The assessment analyses, for example, how much of the Company's rent revenue derives from environmentally certified properties with the right energy classification A och B, according to the EU taxonomy's guidelines. The evaluation also assesses how much of the investments made are green. In summary, 73 percent (61) of the rental value, and 86 percent (79) of the fair value of properties, was green according to CICERO Shades of Green 2021.

Klippans municipality has as per March 23rd informed Migrationsverket, via Länsstyrelsen, that Annehems Park in Ljungbyhed has the capacity to offer 180 places for immigrants.

Jörgen Lundgren

CEO

Interim report January-March 2021

This is Annehem Fastigheter

Business concept

Annehem Fastigheter owns and manages high-quality commercial, community service and residential properties located near good transport links. The properties are located in growth areas in the Nordics and possess a clear environmental profile. Annehem Fastigheter builds lasting relationships and value through management close to customers.

Vision

Annehem Fastigheter is to always be the number one choice for customers and employees wherever we choose to operate.

Mission

Annehem Fastigheter creates attractive and sustainable meeting places and homes. We believe that workplaces, meeting places and homes are tools for nurturing growth and attractiveness. The positive development of our customers in turn creates growth and attractiveness in the cities in which we operate.

Property portfolio

Annehem Fastigheter's current property portfolio has the following geographic range:

• • Capital Region: Stockholm, Helsinki and Oslo

• • South Region: Malmö, Ljungbyhed, Ängelholm, Gothenburg and Helsingborg

Sadelplatsen 4 in Solna

Comments on the Group's performance

Income statement

First quarter

Rent revenue amounted to SEK 50.5 million (45.1), other property income amounted to SEK 10.4 million (9.6), and total property expenses to SEK 19.5 million (17.5), which means that net operating income increased to SEK 41.4 million (37.2). The positive trend for rent revenue was mainly attributable to the additional properties compared with the year-earlier period.

Net operating income per quarter

SEK million 45

Other property income amounted to SEK 10.4 million (9.6) and comprised invoiced operating costs, income from short leases and from the rental guarantees issued (by Peab) for the properties Stenekullen 2, Ultimes I&II and Jupiter 11, which amounted to SEK 2.0 million for the quarter. Rental guarantees were issued for 100 percent of the vacant spaces in Stenekullen 2 (from 1 March 2020) and Ultimes I & II (from 1 July 2020) and Jupiter 11 (from 1 May 2021) by Peab. These guarantees are valid until the vacant spaces are let, but not longer than for 36 months from the issuing date.

40

35

Income from property management amounted to SEK 20.3 million (19.3) in the quarter. Interest expenses amounted to SEK 11.9 million (12.0), which is in line with the year-earlier period. Other financial items amounted to SEK -0.5 million (1.7) and mainly comprised currency effects of SEK 5.5 million (9.2) and changes in value of currency futures of SEK -6.0 million (-7.5).

30 2021 2021 2021 2021 2022 Q1 Q2 Q3 Q4 Q1

The effects of unrealised changes in value of properties amounted to SEK 142.6 million (29.6). The effects of changes in value of fixed-interest derivatives amounted to SEK 35.5 million (0.0).

Tax expense for the period amounted to SEK 40.1 million (7.8). Tax expense is due primarily to deferred tax on the growth in value of the property portfolio and the fair value measurement of fixed-interest derivatives.

Income from property management per quarter excl. items affecting comparability

Income for the period amounted to SEK 158.3 million (40.8).

Balance sheet

SEK million 30

The value of the Company's investment properties amounted to SEK 4,160.3 million (3,406.1) on 31 March 2022. Of the total value, SEK 2.0 million comprised the effect of lease value of leasehold rights in the Kamaxeln 2 property.

The fair value of properties is based on internal valuations conducted on 31 March 2022. During the quarter, Annehem Fastigheter also invested in existing properties with a value amounting to SEK 4.6 million (22.5) at 31 March 2022. The value of the properties in Finland and Norway at 31 March 2022 was positively impacted by the stronger EUR/SEK rate compared with 31 December 2021, yielding a total effect of SEK 19.0 million.

The Company's equity amounted to SEK 2,437.1 million (2,106,6).

25 20 15 10 5 2021 2021 2021 2021 2022 Q1 Q2 Q3 Q4 Q1

Interest-bearing liabilities totalled SEK 1,808.6 million (1,569,7), of which SEK 2.0 million comprised lease liability attributable to rent for leasehold sites. During the quarter, Annehem Fastigheter utilised a further SEK 75.0 million of the loan facility that the Group secured in December 2020, amounting to a total of SEK 1,912.0 million, distributed between SEK, NOK and EUR. At 31 March 2022, SEK 345.0 million remained unutilised.

Cash flow statement

Cash flow from operating activities amounted to SEK 31.3 million (11.9) during the quarter. The change was mainly attributable to higher income from property management, and higher operating receivables and higher operating liabilities.

Cash flow from investing activities for the quarter amounted to SEK -5.9 million (-22.5), with the majority pertaining to additional investments for the completion of Ledvolten, which was acquired in December 2021.

Cash flow from financing activities amounted to SEK 75.0 million (-), derived from drawing on the existing credit facility.

Cash flow for the quarter amounted to SEK 100.4 million (-10.6).

Our properties

Annehem Fastigheter owned assets in the form of fully developed properties on 31 March 2022 at a fair value of SEK 4,160.3 million. All properties are 100-percent owned by the Company. The properties largely comprise modern, flexible and environmentally compatible commercial, community service and residential properties.

As of March 2022, net letting amounted to SEK 5.3 million (9.0), distributed among newly signed leases amounting to SEK 7.2 million (11.3) less terminated leases amounting to SEK 1.9 million (2.3).

Detailed description of property portfolio

Changes to the portfolio compared with the first quarter of 2021

Additional properties, names

Annualised rental value, Fair value incl leasing,

City

From

Area, sqm

SEK million

SEK million

Ledvolten Jupiter 11

Stockholm Helsingborg

2021-12-07 2021-05-01

Total

4,268 4,807 9,075

Property portfolio at 31 March 2022

12.9 329.1

8.4 135.0

21.3 464.1OtherProperty

Property name

City Ängelholm Ljungbyhed Malmö Malmö Helsingborg Stockholm Stockholm Stockholm Partille Helsingfors Oslo

Area, sqmRent-revenue SEK millionAnnualised rental value, SEK millionFair value incl leasing1, SEK million

Valhall Park, Ängelholm Ljungbyhed Park Kamaxeln

Peab Center Malmö Peab Center Helsingborg Peab Center Solna Sadelplatsen 4 Ledvolten Partille Port

Ulimes I&II inkl Parking Carl Berner Torg

Barkåkra 50:3

Sjöleden 1:5-1:17

Kamaxeln 2

Stenekullen 2

Jupiter 11

Sadelplatsen 3

Sadelplatsen 42 Ledvolten

Partille 11:60 Ultimes

Carl Berner Torg

Total

51,564

35.7

37.3 419.0

73,234

28.0

33.7 196.0

950

1.4

1.4 18.6

4,937

14.0

14.0 244.1

4,807

8.4

8.4 135.0 50%

12,455

38.5

38.5 1,006.0

13,494

14.1

17.5 367.0

4,268

12.9

12.9 329.1 30%

6,431

12.8

13.2 196.0

17,015

62.4

62.4 919.0

3,640 192,795

14.2 242.5

14.2 330.5 10%

253.6

4,160.3

• 1) Leasing refers to site leasehold rights amounting to SEK 2 million to Kamaxeln.

• 2) The property largely comprises a garage (475 spaces) and, in addition, office premises of 2,994 sqm.

Summary of value trend

Changes in the property portfolio SEK million

- 4.6 142.6 19.0 4,160.3

Jan-Mar 2022 3,994.1

2021

Full year 2021

At beginning of the period Acquired properties

Investments in existing properties Unrealised changes in fair value Currency effect on properties abroad At end of the period

3,317.5 3,317.5

- 410.9

22.5 52.5

29.6 172.9

36.4 40.3

3,406.1

3,994.1

Acquisitions and investments

During 2022, investments were made in existing properties totalling SEK 4.6 million, with the investments primarily related to the Ledvolten property.

Acquired but not taken into possession

In 2020 and 2021, Annehem Fastigheter signed agreements with Peab to acquire properties when completed.

Specification of income 2022

Commercial offices

Tenants of community service properties

Parking

Grocery store

Restaurant

Residential

Summary of lease terms (percentage of rental value for

each year)

60%

40%

20%

0%

<1 1-2 2-3 3-4 4-5 >5 year years years years years years