Telefonplan Stockholm Property AB (publ) REPORT FOR THE PERIOD January 1 December 31, 2015

Transcription

1 REPORT FOR THE PERIOD January 1 December 31, 2015 Image: View of Timotejen 19

2 Corp. Reg. No Telefonplan Stockholm Property AB (publ) REPORT FOR THE PERIOD January 1 December 31, 2015 JANUARY 1 DECEMBER 31, 2015 COMPARED WITH THE YEAR-EARLIER PERIOD The Group s net revenue amounted to SEK 9,152 thousand (8,136) The operating net amounted to SEK 455 thousand (834) Property management net (EBITDA) amounted to SEK 7,717 thousand (loss: 13,774) The loss after tax was SEK 63,489 thousand (loss: 46,619) OCTOBER 1 DECEMBER 31, 2015 COMPARED WITH THE SAME PERIOD IN 2014 The Group s net revenue amounted to SEK 2,848 thousand (183) The operating net amounted to SEK 359 thousand (loss: 1,939) Property management net (EBITDA) amounted to a loss of SEK 2,330 thousand (loss: 5,836) The loss after tax was SEK 20,811 thousand (loss: 16,982) SIGNIFICANT EVENTS AND COMMENTS ON PERFORMANCE During the reporting period (January 1 December 31, 2015) Development planning is in progress in collaboration with White architects for the Timotejen 19 and 28 properties. On September 1, 2014, the company submitted the complete documentation for consultation to the City of Stockholm. In February 2015, the Swedish Armed Forces gave notice that construction of the Timotejen 17 property, adjacent to the Timotejen 28 property owned by the SSM Group, was not permitted at the proposed location. The plan for the Timotejen 17 property comprises a 237-meter high building with 75 floors and falls within the scope of the same detailed development plan as the Timotejen 19 and 28 properties. The decision of the Swedish Armed Forces is irrevocable and will impact the ongoing detailed development plan process in respect of when it can be approved. In September 2015, the Air Navigation Services Provider of Sweden (LFV) announced that all heights over 80 meters above sea level cause conflict with the radar facility at Bällsta radar tower. The radar tower has been shut down for several years and not comprised any hindrance for currently approved detailed development plans. Therefore, the total heights for Timotejen 19 and 28 have been adjusted and calculations are ongoing with the aim of investigating any lost development rights in terms of space. The new date stipulated for when the City of Stockholm can be expected to adopt the detailed development plan for Timotejen 19 and 28 has been set for June In conjunction with the start of the spring term in 2015, the Internationella Engelska Skolan expanded its space at Timotejen 19. CrossFit Telefonplan is a new tenant and, in March, opened a new gym at Timotejen 19 with opening hours from 5:00 a.m. to 11:00 p.m. daily. The Internationella Engelska Skolan continues to increase the size of its establishment at Telefonplan in the Timotejen 19 property. In August 2015, the school took possession of an additional 2,700 square meters of space and, accordingly, leases a total of approximately 6,250 square meters, which will be increased by an additional 1,200 square meters from Page 2 of 12

3 Corp. Reg. No The Timotejen 19 property has been subdivided to create a new property, Timotejen 29. The Timotejen 29 property comprises a three-dimensional property unit comprising a total of 2,180 square meters. Prior to signing a contract with ICA for the purchase of Timotejen 29, all shares were acquired in the dormant company Scanprop Fastigheter 1 AB, with its wholly owned dormant subsidiary Scanprop Fastigheter 2 AB, with the aim of creating a holding company under Telefonplan Stockholm Property AB (publ). In conjunction with establishment of Timotejen 29, the property was also transferred internally in the Group to Scanprop Fastigheter 2 AB. On November 6, ICA Fastigheter acquired the newly formed Timotejen 29 property through a company. ICA intends to develop an ICA Kvantum on the property, which includes Ericsson s old canteen. The transaction took place at a property value of SEK 19.2 million and was announced earlier in the company description prepared in conjunction with the listing of the company s bond. The earnings effect of the transaction is recognized in the fourth quarter of 2015 and resulted in an accounting loss of SEK 7.3 million. The sale is to be seen in light of the future market advantage of being able to offer an ICA Kvantum on the property for the future residents of the tenant-owner apartments. After the reporting period In a press release published on February 22, 2016, Telefonplan Stockholm Property AB (publ) announced that a process had been initiated to explore the possibility of obtaining additional financing to further strengthen the company s financial capacity in relation to its strategic real estate investments on the properties. For an update of Telefonplan Stockholm Property AB (publ) and the investment project, please see the presentation on the company's website, FUTURE OUTLOOK The delay in the new detailed development plan is putting pressure on the Group s liquidity in the short term. As the properties are developed, they will be divided into saleable units, which will lead to gradual strengthening of the total cash flow. As announced in the press release, a process is under way to obtain additional financing to further strengthen the company s financial capacity. This process is expected to be completed during the first quarter of OVERVIEW OF OPERATIONS The Group s property portfolio comprises mainly properties held for future development and development properties. The properties were originally acquired to be converted from their existing uses into properties with other uses that are in demand in the property market for that area. The conversion process is being implemented in collaboration with the surrounding property owners and the City of Stockholm. Telefonplan is an area located in the Midsommarkransen city district, in southern Stockholm, only about three kilometers from Hornstull. The area is dominated largely by LM Ericsson s former telephone plant, constructed in the 1940s. Telefonplan is currently undergoing the biggest change in the area for more than 60 years. Plans are in place to redevelop and convert the characteristic Ericsson building, Timotejen 19, on Tellusborgsvägen, into housing units, stores and a school. COMMENTS ON THE FINANCIAL PERFORMANCE Net revenue/income The Group s income in the fourth quarter of 2015 amounted to SEK 2,848 thousand (183), and to SEK 9,152 thousand (8,136) for the full-year Page 3 of 12

4 Corp. Reg. No During the property portfolio s development process, parts of the property portfolio are successively being converted from former operations, and old tenants are moving out to facilitate the planned remodeling of the buildings and the area. In November 2013, the last of Ericsson s operational departments and personnel vacated the premises, in parallel with space being created in part of the property for the Internationella Engelska Skolan to move in. The fact that rental income declined or even ceased during the conversion process is according to plan and is a natural part of the development process. However, the properties are still kept available for temporary tenants during the development process. Earnings Property management net (EBITDA) for the fourth quarter amounted to a loss of SEK 2,330 thousand (loss: 5,836), and to a loss of SEK 7,717 thousand (loss: 13,774) for the full-year For the fourth quarter, a loss after tax was reported totaling SEK 20,811 thousand (loss: 16,982), and a loss of SEK 63,489 thousand (loss: 46,619) was reported for the full-year Traditional operating and maintenance costs are declining as the properties are emptied before reaching a lowest level. Part of Timotejen was subdivided in November 2016 and divested to ICA Fastigheter. The earnings effect of the transaction resulted in an accounting loss of SEK 7.3 million. Equity and liabilities The Group s equity amounted to SEK 39,354 thousand (102,844) at December 31, The equity/assets ratio was 5.89% (14.01) on December 31, Cash flow and cash and cash equivalents The Group s cash flow from operations for the fourth quarter amounted to negative SEK 15,995 (neg: 14,628) and negative SEK 57,568 thousand (neg: 9,775) for the full-year Cash flow from investment activities in the fourth quarter amounted to SEK 14,096 thousand (neg: 5,372) and SEK 10,582 thousand (neg: 143,726) for the full-year Cash flow from financing activities in the fourth quarter was SEK 0 thousand (0) and SEK 0 thousand (195,209) for the full-year At the end of the period, the Group s cash and cash equivalents amounted to SEK 66,039 thousand (106,775). Deferred tax The Group reported no deferred tax since no temporary differences are deemed to exist that are expected to lead to future taxation. Accordingly, prior years recognized deferred tax was reversed in the fourth quarter of Investments and financing Telefonplan Stockholm Property AB (publ) has raised a bond loan of SEK 250,000 thousand. The bond has a duration of 24 months from May 23, 2014, with an annual interest rate of 10%. The bond s issue costs, SEK 7,500 thousand, were capitalized under fixed assets and will be amortized over the duration of the bond. The residual value of the asset will be offset as a longterm liability under the item Bond issues. The Group s interest-bearing liabilities pertaining to property acquisitions amounted to SEK 500,000 thousand. On the balance-sheet date, the average interest rate for loans from credit institutions in the Group amounted to SEK 10,356 thousand or 4.14% on an annual basis. The loan pertains to an amount of SEK 250,000 thousand and extends until March 31, The loan was extended on a rolling three-month basis until further notice at otherwise unchanged terms and conditions. Page 4 of 12

5 Corp. Reg. No Human resources The Group has no employees. All management and maintenance services are managed through agreements with subcontractors. PARENT COMPANY The Parent Company s income in the fourth quarter amounted to SEK 2,796 thousand (172), and to SEK 8,929 thousand (8,119) for the full-year In the fourth quarter, the loss before tax was SEK 21,053 (loss: 15,191) and a loss of SEK 59,932 thousand (loss: 44,582) for the full-year Cash and cash equivalents at the end of the year, December 31, 2015, were SEK 58,142 thousand (101,656). In general, the above comments about the Group s financial position also apply to the Parent Company in applicable sections. RISKS AND UNCERTAINTIES Telefonplan Stockholm Property AB (publ) is exposed to risks and uncertainties through its operations. Information about the Group s risks and uncertainties is available in the company description prepared in conjunction with the listing of the company s bond on the Nasdaq First North Bond Market. PROPERTY VALUES On February 19, 2016, external, professional property appraisers have valued the Group s property portfolio at SEK 1,115,000 thousand following the adoption of the detailed development plan. The value appraisals pertain to Timotejen 19 and 28 following the divestment to ICA Fastigheter. Additional information about the property appraisal is available in the company description prepared in conjunction with the listing of the company s bond on the Nasdaq First North Bond Market. ACCOUNTING POLICIES Telefonplan Stockholm Property AB (publ) applies the rules and regulations of the K3 framework from the beginning of This report has been prepared in accordance with the Swedish Annual Accounts Act. The report is unaudited but was prepared in consultation with the company s auditor. The report pertains to full-year 2015, with comparative figures for the corresponding period in 2014, for both the Group and the Parent Company, Telefonplan Stockholm Property AB (publ). In addition to the Parent Company, Telefonplan Stockholm Property AB (publ), the Group comprises the wholly owned subsidiaries Telefonplan Garage Holding AB, which owns Telefonplan Garage AB, Telefonplan Byggrätt AB, Scanprop Fastigheter 4 AB and Telefonplan Timotejen Holding AB, which owns eight dormant companies. All companies in the Group structure are wholly owned. The Group s companies own no interests in associated companies. The Parent Company owns the Timotejen 19 property, while Telefonplan Garage AB owns the Timotejen 28 property. These two properties constitute the Group s total property portfolio. The total leasable space of the properties comprises about 60,000 square meters. Since the properties are development properties and are largely empty, a loss is recognized in the operating activities and consists of non-capitalized costs for operation, maintenance and interest. Remodeling costs for new tenants are capitalized and amortized over the duration of the lease agreement. Page 5 of 12

6 Corp. Reg. No All comparative figures for both the Group and the Parent Company pertain to the full-year and quarters in FORTHCOMING INFORMATION DATES Year-end report for 2015 February 29, 2016 Annual Report March 9, 2016 Annual General Meeting March 31, 2016 Interim report, first quarter of 2016 May 31, 2016 Interim report, first six months of 2016 August 31, 2016 Interim report, third quarter of 2016 November 30, 2016 ABOUT TELEFONPLAN STOCKHOLM PROPERTY AB (PUBL) Within the Group, Telefonplan Stockholm Property AB (publ) owns the two properties, Timotejen 19 and Timotejen 28 at Telefonplan in Stockholm, where the telecom company Ericsson previously had operations. Telefonplan Property now adds value to properties in accordance with the objectives of the City of Stockholm in a development planning effort aimed at making the area into a vibrant city district with offices and housing that are well integrated with Central Stockholm. Telefonplan Stockholm Property AB (publ) has initiated a process to have the properties reclassified as residential properties. Telefonplan Stockholm Property AB (publ) is a wholly owned subsidiary of Telefonplan Stockholm AB, which in turn is a wholly owned subsidiary of Scanprop KB, a private venture capital company founded in 2011 with a focus on strategic investment in the property sector. Telefonplan Stockholm Property AB (publ) has issued the TELEFONPLAN1 bond, which is listed on Nasdaq First North Bond Market, with Wildeco as the Certified Advisor. Page 6 of 12

7 INCOME STATEMENT, THE GROUP Oct 1, 2015 Jan 1, 2015 Jan 1, 2014 Amount SEK thousand Dec 31, 2015 Dec 31, 2015 Dec 31, 2014 Revenues Net sales Rental income 2,848 9,152 8,136 Total income 2,848 9,152 8,136 Property costs Operating and maintenance costs -2,112-7,188-5,794 Property Tax ,508-1,508 Net Operating income (NOI) Property management costs -2,689-8,172-14,608 EBITDA -2,330-7,717-13,774 Depreciations Depresiation on assets -2,047-8,229-7,645-2,047-8,229-7,645 Financial items Financial income 1,672 1,672 2,012 Financial expenses -18,106-47,720-33,314-16,435-46,048-31,302 Profit/loss before tax -20,811-61,993-52,721 Tax -1,495 6,102 Profit/loss for the period after tax -20,811-63,489-46,619 Page 7 of 12

8 BALANCE SHEET, THE GROUP Amount SEK thousand Assets Dec 31, 2015 Dec 31, 2014 Fixed assets Property 547, ,286 Work in progress 36,283 32,362 Total fixed assets 584, ,648 Current assets Receivables 1,228 2,482 Other current receivables 22,751 13,251 Cash and cash equivalents 59, ,775 Total current assets 83, ,508 Total assets 667, ,156 Equty and Liabilities Dec 31, 2015 Dec 31, 2014 Equity Share capital Retained earnings 102, ,963 Profit/loss for the period -63,489-46,619 Total equity 39, ,844 Non-current liabilities and provisions Deferred tax Bond issues 248, ,688 Non-current interest bearing liabilities 250, ,000 Total non-current liabilities and provisions 498, ,688 Current liabilities Other current liabilities 130, ,624 Total current liabilities 130, ,624 Total equity and liabilities 667, ,156 CHANGES IN EQUITY, THE GROUP Oct 1, 2015 Jan 1, 2015 Jan 1, 2014 Amount SEK thousand Dec 31, 2015 Dec 31, 2015 Dec 31, 2014 Opening balance of equity 60, , ,629 Profit/loss for the period -20,811-63,489-46,619 Closing balance of equity 39,354 39, ,844 Page 8 of 12

9 CASH FLOW, THE GROUP Oct 1, 2015 Jan 1, 2015 Jan 1, 2014 Amount SEK thousand Dec 31, 2015 Dec 31, 2015 Dec 31, 2014 Operations Profit/loss before tax -20,811-61,993-52,721 Adjustments not included in cash flow from operations 11,627 20,651 8,188 Tax payed 0-1,495-1 Cash flow from operations before change in working capital -9,185-42,838-44,534 Changes in working capital -6,810-14,730 34,759 Cash flow from operations -15,995-57,568-9,775 Cash flow from investment activities 14,096 10, ,726 Cash flow from financing activities 195,209 Cash flow for the period -1,899-46,986 41,708 Opening cash and cash equivalents 61, ,775 65,068 Closing cash and cash equivalents 59,789 59, ,775-0,0002 Page 9 of 12

10 INCOME STATEMENT, PARENT Oct 1, 2015 Jan 1, 2015 Jan 1, 2014 Amount SEK thousand Dec 31, 2015 Dec 31, 2015 Dec 31, 2014 Revenues Net sales Rental income 2,796 8,929 8,119 Total income 2,796 8,929 8,119 Property costs Operating and maintenance costs -2,112-7,055-5,756 Property Tax ,212-1,212 Net operating income (NOI) ,151 Property management costs -2,668-7,751-13,952 EBITDA -2,287-7,089-12,801 Depreciations Depresiation on assets -1,477-5,950-5,964-1,477-5,950-5,964 Financial items Financial income ,751 Financial expenses -18,105-47,710-33,301-17,288-46,893-30,550 Profit/loss before tax -21,053-59,932-44,582 Tax -1,495 4,969 Profit/loss for the period after tax -21,053-61,428-39,613 Page 10 of 12

11 BALANCE SHEET, PARENT Amount SEK thousand Assets Dec 31, 2015 Dec 31, 2014 Fixed assets Property 440, ,602 Work in progress 36,283 32,362 Total fixed assets 476, ,965 Non-current assets Participations in group companies 1, Total non-current assets 1, Long-term receivables Receivables from group companies 91,823 91,823 Total long-term receivables 91,823 91,823 Current assets Receivables 1,163 2,482 Other current receivables 19,362 13,245 Cash and cash equivalents 58, ,656 Receivables from group companies 21,815 25,086 Total current assets 100, ,469 Total assets 670, ,457 Equty and Liabilities Dec 31, 2015 Dec 31, 2014 Equity Share capital Retained earnings 105, ,821 Profit/loss for the period -61,428-39,614 Total equity 44, ,707 Non-current liabilities and provisions Allocation reserve Deferred tax Bond issues 248, ,688 Non current interest bearing liabilities 250, ,000 Total non-current liabilities and provisions 498, ,688 Current liabilities Current liabilities to group companies Other current liabilities 127, ,970 Total current liabilities 128, ,062 Total equity and liabilities 670, ,457 CHANGES IN EQUITY, PARENT Oct 1, 2015 Jan 1, 2015 Jan 1, 2014 Amount SEK thousand Dec 31, 2015 Dec 31, 2015 Dec 31, 2014 Opening balance of equity 65, , ,937 Profit/loss for the period -21,053-61,428-39,614 Closing balance of equity 44,280 44, ,707 Page 11 of 12

12 CASH FLOW, PARENT Oct 1, 2015 Jan 1, 2015 Jan 1, 2014 Amount SEK thousand Dec 31, 2015 Dec 31, 2015 Dec 31, 2014 Operations Profit/loss before tax -21,053-59,932-49,316 Adjustments not included in cash flow from operations 11,056 18,372 5,964 Adjustments not included in cash flow from operations 0-1,495 Cash flow from operations before change in working capital -9,997-43,055-43,352 Changes in working capital -6,011-9,507 9,067 Cash flow from operations -16,008-52,562-34,285 Cash flow from investment activities 12,562 9, ,286 Cash flow from financing activities 195,209 Cash flow for the period -3,446-43,514 36,639 Opening cash and cash equivalents 61, ,656 65,018 Closing cash and cash equivalents 58,142 58, ,656 Stockholm February 29, 2016 On behalf of The Board Curt Ahnström, CEO For further information, please contact: Curt Ahnström, CEO Telephone: +46 (0) Page 12 of 12