Revenues up but profitability down
Offentliga Hus' third-quarter report was in line with our expectations. Revenues in the quarter were SEK 140.1m (compared with SEK 80.8m in the third quarter of 2019) and EBITDA was SEK 78.4m (SEK 50.2m), corresponding to an EBITDA margin of 56% (62%) for the quarter. The average lease duration was 4.7 years, a small increase from 4.6 years a quarter earlier. The occupancy ratio was 93%, in line with our expectations.
Financial position improves after equity listing in October
Offentliga Hus reported a loan-to-value (LTV) ratio of 62%, while NCR-adjusted LTV (including 50% equity treatment of a SEK 575m hybrid bond among other things) was 70%. We expect the LTV ratio and overall financial gearing to decrease during the fourth quarter, following a successful initial public offering in October. The company's reported EBITDA to net interest ratio was 1.8x. Calculated in accordance with NCR adjustments, the metric was 1.5x, a marginal decrease from 1.6x a quarter earlier. As of 30 Sep. 2020, Offentliga Hus' cash position was SEK 87m.
This commentary does not constitute a rating action.
If you have any questions, please contact:
Marcus Gustavsson, credit rating analyst, +46700442775, marcus.gustavsson@nordiccreditrating.com
Mille O. Fjeldstad, credit rating analyst, +4799038916, mille.fjeldstad@nordiccreditrating.com
OFFENTLIGA HUS I NORDEN AB (PUBL) 
