2015-08-13 07:00:00 CEST
2015-08-13 07:00:05 CEST
REGULATED INFORMATION
Orava Asuntorahasto Oyj - Interim report (Q1 and Q3)
ORAVA RESIDENTIAL REIT’S FINANCIAL RESULT 1 JANUARY – 30 JUNE 2015
Orava Residential REIT plc
INTERIM REPORT 13 July 2015 at 8:00 a.m.
ORAVA RESIDENTIAL REIT'S FINANCIAL RESULT 1 JANUARY - 30 JUNE 2015
1 April - 30 June 2015
- Revenue: EUR 4.7 million (1 April - 30 June 2014: EUR 4.1 million)
- Comprehensive profit: EUR 1.9 million (EUR 2.4 million)
- Earnings per share: EUR 0.19 (EUR 0.58)
- Economic occupancy rate: 90.9% (92.7%)
- Gross rental yield: 6.8% (6.8%)
- Net rental yield: 3.7% (4.9%)
- Profit from assignments and changes in fair value: EUR 2.9 million (EUR
2.6 million)
- Total dividends distributed during the period under review: EUR 0.30 per
share (EUR 0.28 per share)
1 January - 30 June 2015
- Revenue: EUR 9.3 million (1 January - 30 June 2014: EUR 8.4 million)
- Comprehensive profit: EUR 4.1 million (EUR 4.8 million)
- Earnings per share: EUR 0.54 (EUR 1.15)
- Economic occupancy rate: 90.4% (87.4%)
- Gross rental yield: 6.8% (6.6%)
- Net rental yield: 3.9% (4.2%)
- Profit from assignments and changes in fair value: EUR 4.5 million (EUR
5.6 million)
- Total dividends distributed during the period under review: EUR 0.60 per
share (EUR 0.56 per share)
Net assets per share of Orava Residential REIT plc amounted to EUR 11.98
(adjusted), while they were EUR 12.02 (adjusted) at the beginning of the year.
The company has continued growing, and the value of its investment properties
totalled EUR 166.2 million at the end of the period (31 December 2014: EUR
130.7 million).
CEO's comments:"Orava Residential REIT's result for the second quarter was almost in
accordance with the target.
The state of the Finnish housing market has not picked up, and the fair value
of the apartments owned by the Residential REIT for the entire quarter remained
unchanged. The returns arisen from wholesale discounts on apartment
acquisitions again helped the company to accumulate earnings. In the second
quarter, the company agreed on the acquisition of 142 apartments from three
different properties at a total of EUR 17.1 million. The fair value of the
investment properties owned by the Residential REIT increased from EUR 152.1
million at the end of March to EUR 166.2 million at the end of June.
The construction of the Residential REIT's first wholly new building project
was begun in the second quarter. The terraced house project to be completed in
Hämeenlinna next year will include 52 apartments.
The gross rental yield of the portfolio remained unchanged. As anticipated, we
managed to increase the economic occupancy rate slightly, so that it was again
over 90 per cent.
With regard to apartment sales, the situation has not become any easier; in the
difficult market situation, apartments were sold at roughly the pace of the
first quarter.
The maintenance and repair costs of investment properties in relation to the
value of the portfolio were 3.1 per cent converted to the annual level, i.e.
0.3 per centage points higher than in the first quarter. The rise is explained
by extra ordinary items, more substantial repair construction than in the first
quarter, and the accrual of heating costs partly in the second quarter.
The number of Orava Residential REIT's shareholders increased from
approximately 6,500 at the end of April to about 6,800 at the beginning of
August. The Residential REIT has shareholders from a total of 22 different
countries. Trading in the company's shares on the Helsinki Stock Exchange has
continued to be active; the average daily turnover in January-June was EUR
306,000 (EUR 289,000 a year before).
Shareholders have been paid a total of EUR 0.60 per share in dividends on the
last business days of March and June according to the decision of the Annual
General Meeting. The next dividend payments will take place at the end of
September and December.
The company estimates that it has reasonable prerequisites for maintaining good
profitability and achieving the targeted total return of 10 per cent on
shareholders' equity this year."
Operating environment
National economy
The change in the Finnish GDP is estimated to remain at 0.0%-0.7%, and next
year it is forecasted to settle in the range 1.0%-1.6%. The change in private
consumption, which is having a key impact on the housing market, is expected to
be 0.2%-0.8% this year, and its growth in 2016 is forecasted to be 0.3%-1.2%.
Market interest rates in the euro area are very low, and short-term rates are
also expected to remain below 1% for approximately the next four to five years.
The estimate is based on the most recent economic forecasts by 15 parties
drawing up forecasts on the Finnish economy and the market interest rate
expectations calculated on the basis of the euro interest rate curve published
by the European Central Bank.
The housing market is estimated to start to strengthen slowly as of next winter
as a result of the picking up of general economic development.
Demand in the housing market
During April-June 2015, households drew down EUR 4.5 billion in new mortgages,
or 9% more than a year previously according to statistics from the Bank of
Finland. The euro-denominated mortgage base totalled EUR 90.7 billion at the
end of June, and the annual growth in the mortgage base remained at 2.0%.
The average marketing period for old apartments in the country overall
decreased slightly from 110 days in April to 109 days in July according to the
Finnish Etuovi.com marketing service, while it was 104 days in July in the
previous year.
The demand for apartments during late spring has continued to be slightly more
active than last winter, mainly as a result of seasonal fluctuations.
Supply in the housing market
According to Statistics Finland, building permits for apartment blocks were
granted for 1,551 apartments in May, which was 17% less than a year previously.
Correspondingly, in January-May, building permits for apartment blocks were
granted for a total of 7,559 apartments, or 14% less than a year previously.
The annual change in the sliding annual sum of building permits granted for
apartment blocks was 0%.
The three-month change in the housing construction volume index, which
describes the value of on-going new construction, was -9% in April, and the
change year-on-year was -13%.
According to the August confidence indicator survey of the Confederation of
Finnish Industries, the balance figure for construction production for the past
three months was +32 points in the second quarter of the year, while it was -12
points in the previous quarter and +15 points a year before. The balance figure
for the three-month production expectation was +27 points, compared to +20
points in the previous quarter and +2 points a year before. The number of
unsold residential apartments compared to normal fell from +24 in the first
quarter of the year to +9; a year ago, the balance figure was +29 points.
According to the most recent statistics, supply in the housing market has
continued to decline, even though the expectations of builders have taken a
positive turn.
Prices, rents and return in the housing market
In the second quarter of 2015, the rents of non-subsidised apartments increased
by 2.8% year-on-year. The change in the prices of apartments during the second
quarter was -0.9% compared with the situation a year previously. The ratio of
housing prices to rents is slightly below the long-term average; the ratio
calculated from the square metre prices and rents of the second quarter was
15.3. The 40-year average for the ratio of square metre prices to annual rents
in Finland is 16.7.
We continue to expect housing prices throughout the country to start rising
slightly during the next 12 months and the growth rate in rents for
non-subsidised apartments to remain approximately the same if the market
interest rate expectations and economic forecasts prove to be accurate with
regard to their essential components affecting the housing market.
Rental operations
The occupancy rates of rental operations rose in the second quarter of the year
compared with both the turn of the year and the corresponding period in the
previous year. We have managed to increase the occupancy rate as planned with
regard to apartments acquired without tenants during 2014 and the first half of
2015. The economic occypancy rate of the second quarter of the year was 90.9%.
In the future, any increase in the occupancy rate will be hindered by the
acquisition of apartments without tenants and the rental market in Salo, which
has continued to be weak.
1 Jan - 30 Jun 2015 1 Jan - 30 Jun 2014
Gross rental yield, % 6.8 6.6
Net rental yield, % 3.9 4.2
Economic occupancy rate, % 90.4 87.4
Operational occupancy rate, % 88.8 86.2
Tenant turnover/month, % 2.4 1.9
The economic occupancy rate, adjusted so that acquisitions in the past six
months have been eliminated, was 94.1%.
At the end of the period, the company had a total of 1,594 apartments (2014:
1,002). There were 1,320 leases at the end of the period (2014: 979), and 108
apartments were for sale (2014: 48). Approximately 98% of the entire lease base
for residential apartments is in agreements valid until further notice. A total
of 108 agreements were terminated during the period (2014: 56).
Acquisitions
Acquisitions during the second quarter of the year
Debt-free Directed
Investment purchase price Loan issues Apartments
Time property (EUR million) (EUR million) (1,000 shares) (pcs)
29 May 2015 A property in 5.8 4.0 50 52
Hämeenlinna
(a building project)
29 Jun 2015 Apartments in 4.2 - 369 46
1 property (Vantaa)
30 Jun 2015 2 properties 7.1 4.0 138 44
(Lahti)
TOTAL 17.1 9.4 487 142
On 29 May 2015, the company agreed with Rakennusliike Leimarakentajat Oy on the
construction of 52 apartments in Hämeenlinna. The apartments to be built will
be completed by the end of 2016. The company is financing the building project
with directed issues allocated to Rakennusliike Leimarakentajat Oy and company
loans taken out for the company established. The total value of the directed
issues allocated to Rakennusliike Leimarakentajat Oy during the building period
is approximately EUR 1.8 million. At the time of the agreement, Rakennusliike
Leimarakentajat Oy subscribed to a total of 50,450 shares at EUR 0.6 million.
The subscription price of the shares was the weighted average price during the
five days of stock exchange trading on the NASDAQ OMX Helsinki preceding the
subscription. The remainder of the directed issues will be subscribed after the
project has been completed.
Through a transaction concluded on 29 June 2015, the company acquired 46
apartments from Asunto Oy Vantaan Kaakkoisväylä 4 at a purchase price of EUR
4.15 million. The transaction was financed through a directed issue allocated
to Maakunnan Asunnot Oy, where Maakunnan Asunnot Oy subscribed to 369,218 new
shares issued by the company. Of these shares, 192,889 do not provide
entitlement to dividends paid in 2015. The subscription price of the shares was
the weighted average price during the five days of stock exchange trading on
the NASDAQ OMX Helsinki preceding the subscription.
On 30 June 2015, the company concluded a binding agreement to acquire a total
of 44 apartments from Asunto Oy Lahden Jukolan Aapo and Asunto Oy Lahden
Jukolan Tuomas at a debt-free purchase price of EUR 7.1 million. The
transaction will be partly financed through a directed issue allocated to
Suomen Vuokrakodit Oy, where Suomen Vuokrakodit Oy has undertaken to subscribe
to 138,163 new shares issued by the company. Of these shares, 71,684 do not
provide entitlement to dividends paid in 2015. The subscription price of the
shares is the weighted average price during the five days of stock exchange
trading on the NASDAQ OMX Helsinki preceding the subscription.
Apartment sales
In the difficult market situation, apartment sales remained at the same level
as in the first quarter of the year. During the second quarter of the year, the
company sold a total of 7 apartments from six different housing companies. The
debt-free selling prices of the apartments totalled EUR 0.7 million. The sales
commissions totalled EUR 28 thousand. The total apartment sales EUR 1.5 million
on the first half of the year exceeds the total apartment sales on the same
period of the previous year (1 Jan - 30 Jun 2014: EUR 1.2 million).
Investment properties on 30 June 2015
The fair value of investment properties at the end of the period totalled EUR
166.2 million (31 December 2014: EUR 130.7 million). Orava Residential REIT had
a total of 1613 apartments on 30 June 2015 (31 December 2014: 1,318) with an
aggregate leasable surface area of approximately 99.0 thousand m2 (31 December
2014: 82,200 m2). The apartments were located at 80 different housing
companies, and the company's holding was 100% in 18 of the cases. More detailed
information on the investment properties is presented in the tables section.
Age and regional distributions of the investment portfolio
30 Jun 2015 30 Jun 2014
Newer (1990-present) 61% 55%
Older (until 1989) 39% 45%
Helsinki Region 36.5% 43%
Major towns 30.4% 19%
Rest of Finland 33.1% 38%
The values of the apartments owned by the REIT are measured at fair value at
least on a monthly basis, and are published at least on a quarterly basis, and
always when a change in the REIT's economic situation requires it or when
changes in the condition of the real estate have a material impact on the value
of the holdings of the REIT. A more detailed account of the apartment price
measurement model is presented in the 2014 financial statements.
Consolidated profit for the second quarter of the year
Consolidated revenue for the second quarter of the year totalled EUR 4.7
million (2014: EUR 4.1 million). The revenue was divided between income from
ordinary operations of EUR 2.5 million (2014: EUR 1.6 million) and capital
gains of EUR 2.2 million (2014: EUR 2.6 million). Income from ordinary
operations includes rental income, compensation for use and other income.
Capital gains are made up of profit from sales of investment properties less
sales commissions for sold apartments, as well as the change in the fair value
of apartments.
Operating expenses totalled EUR 2.3 million (2014: EUR 1.3 million), of which
maintenance costs and annual repairs accounted for EUR 1.3 million (2014: EUR
0.4 million).
Operating profit amounted to EUR 2.4 million (2014: EUR 2.9 million)
Financial income and expenses stood at EUR -0.9 million (2014: EUR -354,000)
and taxes for the period at EUR 20,000 (2014: EUR 6,000).
Profit for the second quarter of the year amounted to EUR 1.4 million (2014:
EUR 2.5 million). Comprehensive income items totalled EUR 503,000 (2014: EUR
-140,000) and comprehensive profit for the period totalled EUR 1.9 million
(2014: EUR 2.4 million).
Financing
Net financial expenses totalled EUR 1.3 million in the period 1 January - 30
June 2015 (2014: EUR 726,000), and repayments of the parent company's loans
from financial institutions totalled EUR 17.4 million (2014: EUR 330,000). The
interest rate risk of the parent company's loans from financial institutions is
hedged in their entirety through interest rate swaps concluded with Danske
Bank.
The interest-bearing loans of Orava Residential REIT and the company loans
allocated to the shares in housing companies totalled EUR 79.6 million on 30
June 2015 (31 December 2014: EUR 60.0 million).
In addition to these, the long-term loans on the statement of financial
position also include EUR 585,000 in rental deposits paid by tenants (31
December 2014: EUR 478,000).
Shares and shareholders of Orava Residential REIT
In the second quarter, the company implemented directed issues of a total of
1,119,668 shares, and applied for the shares to be admitted to trading on the
main list of the Helsinki Stock Exchange (trading codes OREIT and OREITN0115).
The company allocated 200,000 and 500,000 shares to itself in a charge-free
share issue on 4 June 2015 and 17 June 2015. In addition, in directed issues
related to acquisitions, Rakennusliike Leimarakentajat Oy subscribed to 50.450
shares on 29 May 2015 and Maakunnan Asunnot Oy subscribed to 369,218 shares on
29 June 2015 was entered into the Trade Register by 3 July 2015. Of the shares
subscribed to in the issues, 419,383 shares do not provide entitlement to
dividends paid from the profit for 2014 during 2015, but they will provide
entitlement to dividends in 2016 and subsequent years.
The trading codes of the company's shares are OREIT and OREITN0115. During the
period under review, the average turnover of shares was approximately EUR
306,000.
The company had more than 6,800 shareholders at the beginning of August.
LIST OF OWNERS ON 5 AUGUST 2015, TEN LARGEST
Shareholder Number of shares %
Royal House Group*** 497,925 6.4
Maakunnan Asunnot Oy* 436,640 5.6
Godoinvest Oy** 229,360 2.9
Yli-Torkko, Erkki 135,205 1.7
Osuusasunnot Oy 124,704 1.6
Rannikko, Reino 90,000 1.2
Vähävara Oy 55,000 0.7
Orava Funds plc**** 45,639 0.6
Signe och Ane Gyllenbergs Stiftelse 43,845 0.6
Talvio, Pirkko 38,100 0.5
Total 1,696,418 21.7
* Companies under the control of Board members Tapani Rautiainen and Timo
Valjakka
** Company under the control of Board member Timo Valjakka
*** Company under the control of Board member Tapani Rautiainen
*** Company under the control of Board member Jouni Torasvirta
Management of the Residential REIT
Orava Residential REIT was established on the initiative of Orava Funds plc.
Orava Funds is responsible for the organisation, management and development of
the operations and administration of the Residential REIT. The Residential REIT
has no personnel of its own.
As compensation for management services, Orava Residential REIT pays the
management company 0.6% of the fair value of the assets of the REIT as an
annual fixed management fee and 20% of the annual return on the REIT exceeding
the hurdle rate of 6% as a performance-based management fee. The stock exchange
price is used in the calculation of the performance-based management fee if it
is lower than net assets per share. The performance-based management fee is
only paid if the closing stock exchange price for the financial period is
higher than the highest closing stock exchange price for the previous financial
periods, adjusted for dividends, issues and splits.
The fixed management fee is calculated on a quarterly basis, and the value is
considered to be the latest fair value of the assets according to IFRS in the
previous quarter. The fixed management fees during the period 1 January - 31
December 2015 amounted to EUR 439,000 (2014: EUR 273,000), including value
added tax.
On the basis of the company's net assets per share, share price and dividend
distribution realised in 2015, a performance-based management fee of EUR
704,000 has been booked (2014: EUR 934,000). The performance-based management
fee will be paid after the end of 2015, on the basis of the company's realised
net assets per share or the adjusted share price in March 2016.
During the period, Newsec Asset Management Oy and Ovenia Oy were paid a total
of EUR 383,000 for financial administration and other support activities and
for apartment rental operations and administrative services, including value
added tax.
Personnel
The personnel of Orava Residential REIT are part of the business organisation
of the management company. The management company is responsible for the
personnel expenses incurred from the operational activities of the Residential
REIT.
Board of Directors and auditors
Orava Residential REIT's Board of Directors is composed of six members: Tapani
Rautiainen, Veli Matti Salmenkylä, Jouni Torasvirta, Timo Valjakka, Mikko
Larvala and Patrik Hertsberg (as of 19 March 2015) and Peter Ahlström (until 19
March 2015). The Chairman of the Board is Jouni Torasvirta, and the Vice
Chairman is Tapani Rautiainen. The Board of Directors convened twelve times
during the period under review. The Board members' rate of attendance at Board
meetings was 97%.
Orava Residential REIT's auditor is PricewaterhouseCoopers Oy, with Eero
Suomela, APA, as the chief auditor. The auditor is paid a fee in accordance
with the invoice.
Authorisations of the Board of Directors
The Board of Directors has an authorisation for a share issue of 6,000,000
shares given by the Annual General Meeting on 19 March 2015. On 30 June 2015, a
total of 4,190,191 shares remain of the share issue authorisation.
Management
Pekka Peiponen is the CEO of Orava Residential REIT. The management of Orava
Residential REIT is part of the business organisation of the management company
Orava Funds plc. The management company is responsible for the costs of
personnel and management incurred from the REIT's operational activities.
Regulation
The current rules for real estate investment operations are available on the
company's website at www.oravaasuntorahasto.fi, and they are included as an
appendix.
Near-term risks and uncertainties
Orava Residential REIT estimates that the key risks and uncertainties for the
company in the near future will be related to the acquisition of investment
properties, changes in the value of apartments and repair costs.
It may be challenging and difficult for the company to acquire investments that
meet the company's goals. In addition, it may be difficult for the company to
secure debt financing for investments under competitive terms and conditions.
Major unexpected repairs and repair costs would result in a decline in the
occupancy rate of apartments, loss of rental income and a decline in
profitability.
Major events 1 January - 30 June 2015
The 500,000 shares that Orava Residential REIT plc allocated to itself in the
charge-free share issue on 17 December 2014 were recorded in the Trade Register
on 5 January 2015. The company may use the shares allocated to itself to
strengthen its capital structure, develop its business and widen its ownership
base through both acquisition of investment properties and the issue of
convertible bonds. After the issue, the number of the company's shares totalled
5,706,123.
On 19 January 2015, Orava Residential REIT submitted a listing application for
47,800 shares to be admitted to trading on the stock exchange list of the
Helsinki Stock Exchange as of 20 January 2015. The shares are included in the
500,000 shares recorded in the Trade Register on 1 January 2015. The trading
code of the shares is OREIT, and the ISIN code is FI4000068614. After the
listing, the total number of the company's listed shares was 5,253,923.
On 23 January 2015, the Financial Supervisory Authority approved the company's
prospectus, which was related to the listing of a total of 1,056,122 shares.
The shares were related to the directed issue allocated to Osuusasunnot Oy
(235,922 shares), communicated by the company on 28 November 2014, the directed
issue allocated to Royal House Oy (368,000 shares), communicated on 31 December
2014, and the charge-free directed issue allocated to the company itself
(500,000 shares, of which 47,800 shares were listed on 20 January 2015),
communicated on 5 January 2015. In the directed issues subject to a payment,
the subscription price of new shares was the average stock exchange price on
the Helsinki Stock Exchange weighted by the share turnover during the five
trading days preceding the subscription. The subscription price of Osuusasunnot
Oy was EUR 11.33 per share, and the subscription price of Royal House Oy was
EUR 10.60 per share.
The 368,000 new shares allocated by Orava Residential REIT plc to Royal House
Oy in connection with a property acquisition on 31 December 2014 and the
200,000 shares allocated to the company itself in a charge-free share issue on
9 February 2015 were recorded in the Trade Register on 12 February 2015. The
company may use the new shares allocated to itself to strengthen its capital
structure, develop its business and widen its ownership base through both
acquisition of investment properties and issue of convertible bonds. After the
issues, the number of the company's shares recorded in the Trade Register
totalled 6,510,045.
The Helsinki Stock Exchange approved Orava Residential REIT's listing
application concerning the aforementioned 568,000 shares, and the new shares
have been subject to trading on the stock exchange list since 13 February 2015.
The trading code of the 368,000 shares allocated to Royal House Oy is OREIT and
the ISIN code is FI4000068614. The trading code of the 200,000 shares allocated
by the company to itself is OREITN0115 and the ISIN code is FI4000148036. The
shares with the trading code OREITN0115 do not provide entitlement to dividends
paid from the profit for 2014 during 2015, but they will provide entitlement to
dividends in 2016 and subsequent years. After these issues, the number of the
company's listed shares totalled 6,510,045.
The company's Annual General Meeting was held on 19 March 2015. The AGM decided
to change the company name to Orava Residential REIT plc (previously Orava
Residential Real Estate Investment Trust plc). The related amendment to section
1 of the Articles of Association was recorded in the Trade Register on 31 March
2015.
The AGM decided to make a specification in the rules for real estate investment
operations concerning the payment of the performance-related management fee so
that the stock exchange price of the share shall be used in the calculation of
the management fee if it is lower than net assets per share. According to the
decision of the AGM, the rules for real estate investment operations (section
11, paragraph 3) were specified with regard to the determination of the
management fee. The clause "if the stock exchange price of the share is lower
than net assets per share" was added to the end of the sentence, "After
listing, the stock exchange price of the share shall be used in the calculation
instead of net assets per share" in section 11, paragraph 3.
The AGM decided to grant a share issue authorisation to the Board of Directors
so that, on the basis of the authorisation, the Board may decide to issue no
more than 6,000,000 new shares in the company (of which no more than 1,500,000
shares shall provide entitlement to dividends as of 1 April 2015 and 4,500,000
shares shall not provide entitlement to dividends during 2015).
The company acquired a total of 140 apartments through transactions made and an
agreement concluded on 31 March 2015. Their aggregate debt-free purchase price
was EUR 16.1 million. The company concluded a binding agreement with Skanska
Talonrakennus Oy on a transaction of 53 apartments, which are located in a
total of nine properties in Tampere (11 apartments), Turku (5), Oulu (7), Vaasa
(5), Rovaniemi (13), Kokkola (3) and Savonlinna (9). In addition, a residential
property of 36 apartments at Hoviherrankatu 3 in Kaarina and a residential
property of 51 apartments at Kunnaankatu 7 in Raisio were purchased from
Osuusasunnot Oy. The transaction was partly financed through a directed issue
allocated to Osuusasunnot Oy, where Osuusasunnot Oy subscribed to 244,193 new
shares issued by the company. Of these shares, 128,461 do not provide
entitlement to dividends paid in 2015. The subscription price of the shares was
the weighted average price during the five days of stock exchange trading on
the NASDAQ OMX Helsinki preceding the subscription.
Orava Residential REIT issued a bond of EUR 20 million on 1 April, and
communicated its decision to issue the bond on 26 March 2015. The bond will
fall due on 1 April 2020, and a fixed coupon of 4.25% will be paid on it. The
bond was listed on the regulated market of the Helsinki Stock Exchange on 2
April 2015. Danske Bank Plc acted as the lead manager in the issue of the bond,
and Castrén & Snellman Attorneys Ltd acted as the legal advisor in the
arrangement.
The 244,193 new shares allocated by Orava Residential REIT plc to Osuusasunnot
Oy in connection with an acquisition on 31 March 2015 were recorded in the
Trade Register on 17 April 2015. After the issue, the number of the company's
shares recorded in the Trade Register totalled 6,754,238. Of the shares
allocated to Osuusasunnot Oy, the ISIN code of 115,732 shares is FI400068614
(trading code OREIT), and the ISIN code of 128,461 shares is FI4000148036
(trading code OREITN0115). The shares whose trading code is OREITN0115 do not
provide entitlement to dividends paid from the profit for 2014 during 2015, but
they will provide entitlement to dividends in 2016 and subsequent years. The
company submitted a listing application to the Helsinki Stock Exchange
concerning the aforementioned 244,193 shares, and the new shares have been
subject to trading on the stock exchange list since 21 April 2015. After the
listing, the number of the company's listed shares totalled 6,754,238.
The transaction of 53 residential apartments agreed with Skanska Talonrakennus
Oy in March 2015 was completed on 28 April 2015.
On 29 may 2015, the company agreed with Rakennusliike Leimarakentajat Oy on the
construction of 52 apartments in Hämeenlinna. The apartments to be built will
be completed by the end of 2016. The company is financing the building project
with directed issues allocated to Rakennusliike Leimarakentajat Oy and company
loans taken out for the company established. The total value of the directed
issues allocated to Rakennusliike Leimarakentajat Oy during the building period
is approximately EUR 1.8 million. At the time of the agreement, Rakennusliike
Leimarakentajat Oy subscribed to a total of 50,450 shares at EUR 0.6 million.
The subscription price of the shares was the weighted average price during the
five days of stock exchange trading on the NASDAQ OMX Helsinki preceding the
subscription. The remainder of the directed issues will be subscribed after the
project has been completed.
The 200,000 shares that Orava Residential REIT plc allocated to itself in the
charge-free share issue on 4 June 2015 were recorded in the Trade Register on 9
June 2015. The company may use the shares allocated to itself to strengthen its
capital structure, develop its business and widen its ownership base through
both acquisition of investment properties and the issue of convertible bonds.
After the issue, the number of the company's shares recorded in the Trade
Register totalled 6,954,238. Of the shares allocated to the company itself, the
ISIN code of 150,000 shares is FI400068614 (trading code OREIT), and the ISIN
code of 50,000 shares is FI4000148036 (trading code OREITN0115). The shares
whose trading code is OREITN0115 do not provide entitlement to dividends paid
from the profit for 2014 during 2015, but they will provide entitlement to
dividends in 2016 and subsequent years.
The company submitted a listing application to the Helsinki Stock Exchange
concerning the aforementioned 200,000 shares, and the new shares have been
subject to trading on the stock exchange list since 10 June 2015. After the
listing, the number of the company's listed shares totalled 6,954,238.
The 500,000 shares that Orava Residential REIT plc allocated to itself in the
charge-free share issue on 17 June 2015 were recorded in the Trade Register on
23 June 2015. The company may use the shares allocated to itself to strengthen
its capital structure, develop its business and widen its ownership base
through both acquisition of investment properties and the issue of convertible
bonds. After the issue, the number of the company's shares recorded in the
Trade Register totalled 7,454,238. Of the shares allocated to the company
itself, the ISIN code of 350,000 shares is FI400068614 (trading code OREIT),
and the ISIN code of 150,000 shares is FI4000148036 (trading code OREITN0115).
The shares whose trading code is OREITN0115 do not provide entitlement to
dividends paid from the profit for 2014 during 2015, but they will provide
entitlement to dividends in 2016 and subsequent years.
The 50,450 shares allocated by the company to Rakennusliike Leimarakentajat Oy
in May 2015 and the 377,502 shares assigned by the company on the basis of
convertible bond agreements concluded between 1 March and 31 May 2015 were
recorded 23 June 2015 in the company's shareholders' equity items. The increase
in share capital is EUR 4.3 million, in addition to which EUR 0.8 million was
booked in the company's reserve for invested unrestricted equity. After the
increases, the company's share capital was EUR 67,057,020.00.
Through a transaction concluded on 29 June 2015, the company acquired 46
apartments from Asunto Oy Vantaan Kaakkoisväylä 4 at a purchase price of EUR
4.15 million. The transaction was financed through a directed issue allocated
to Maakunnan Asunnot Oy, where Maakunnan Asunnot Oy subscribed to 369,218 new
shares issued by the company. Of these shares, 192,889 do not provide
entitlement to dividends paid in 2015. The subscription price of the shares was
the weighted average price during the five days of stock exchange trading on
the NASDAQ OMX Helsinki preceding the subscription.
On 30 June 2015, the company concluded a binding agreement to acquire a total
of 44 apartments from Asunto Oy Lahden Jukolan Aapo and Asunto Oy Lahden
Jukolan Tuomas at a debt-free purchase price of EUR 7.1 million. The
transaction will be partly financed through a directed issue allocated to
Suomen Vuokrakodit Oy, where Suomen Vuokrakodit Oy has undertaken to subscribe
to 136,163 new shares issued by the company. Of these shares, 71,684 do not
provide entitlement to dividends paid in 2015. The subscription price of the
shares is the weighted average price during the five days of stock exchange
trading on the NASDAQ OMX Helsinki preceding the subscription.
On 30 June 2015, the Financial Supervisory Authority approved the company's
prospectus, which is related to the listing of a total of 937,664 shares. The
shares are related to the directed issues to Maakunnan Asunnot Oy (369,218
shares) communicated on 29 June 2015 and Suomen Vuokrakodit Oy (68,446 shares)
communicated on 30 June 2015, and the charge-free directed issue allocated to
the company itself (500,000 shares) communicated on 23 June 2015 . In the
directed issues allocated to Maakunnan Asunnot Oy and Suomen Vuokrakodit Oy,
the subscription price of the new shares was the average stock exchange price
on the Helsinki Stock Exchange weighted by the share turnover during the five
trading days preceeding 29 June 2015. The subscription prices of the shares
were EUR 11.65 per share (trading code OREIT) and EUR 10.65 per share (trading
code OREIN0115).
Events after the financial period
On 1 July 2015, the company submitted a listing application to the Helsinki
Stock Exchange concerning the admission of the shares subscribed in the
directed issue allocated to Maakunnan Asunnot Oy on 29 June 2015 and the shares
allocated to the company itself and communicated on 23 June 2015, i.e. a total
of 869,218 shares, to trading on the stock exchange list of the Helsinki Stock
Exchange. Trading in the new shares started on 6 July 2015. Of the shares,
526,329 were applied to be admitted to trading on the stock exchange list with
the trading code OREIT (ISIN code FI4000068614) and 342,889 with the trading
code OREITN0115 (ISIN code FI4000148036).
The Financial Supervisory Authority approved the supplement to the company's
prospectus on 2 July 2015. The prospectus estimated that the 937,664 shares
will be applied to be admitted to trading on the stock exchange list of the
NASDAQ OMX Helsinki on 3 July 2015. The 68,446 shares subscribed by Suomen
Vuokrakodit Oy will be applied to be admitted to trading later.
The 369,128 shares allocated by the company to Maakunnan Asunnot Oy on 29 June
2015 were recorded in the Trade Register on 3 July 2015. The increase in the
share capital was EUR 3.7 million. After the increases, the number of the
company's shares recorded in the Trade Register totalled 7,823,456 and the
company's share capital was EUR 70,749,200.00.
Orava Residential REIT allocated a new share issue to Suomen Vuokrakodit Oy on
31 July 2015. Suomen Vuokrakodit Oy has undertaken to subscribe to 69,717 new
shares issued by the company. Of these shares, 35,926 do not provide
entitlement to dividends paid in 2015. The subscription price of the shares is
the weighted average price during the five days of stock exchange trading on
the NASDAQ OMX Helsinki preceding 31 July 2015. The directed issue is related
to the binding agreement communicated on 30 June 2015, by which Orava
Residential REIT acquired a total of 44 apartments from Asunto Oy Lahden
Jukolan Aapo and Asunto Oy Lahden Jukolan Tuomas at a debt-free purchase price
of EUR 7.1 million.
Dividend
The Annual General Meeting of 19 March 2015 decided to distribute a dividend of
EUR 0.30 per share from the profit for 2014 in each quarter of 2015, i.e. in
total at most EUR 1.20 per share in 2015 (100% dividend rights). The dividend
will be paid on the last business day of each quarter.
Dividends per share paid during the period under review:
FI4000068614
(100%)
31 Mar 2015, 1st dividend EUR 0.30
30 Jun 2015, 2nd dividend EUR 0.30
Total EUR 0.60
Future outlook
Orava Residential REIT estimates that it has reasonable prerequisites for
maintaining good profitability and achieving the targeted total return of 10
per cent on shareholders' equity in 2015.
The change in the value of apartments in the investment portfolio is expected
to remain close to zero in the second half of the year. Rental returns are
estimated to remain unchanged or rise slightly, as we believe that we can still
increase the economic occupancy rate slightly compared with the first half of
the year. The result impact of property acquisitions is expected to remain at
the level of the first half of the year. The ratio of maintenance and repair
costs to the value of investment assets is also expected to remain
approximately at the level of the first half of the year or slightly lower.
Helsinki, 12 August 2015
Orava Residential REIT plc
Board of Directors
Additional information:
Pekka Peiponen, CEO, tel. +358 (0)10 420 3104
Veli Matti Salmenkylä, CFO and administrative director, tel. +358 (0)10 420 3102
© 2024 Nasdaq, Inc. All Rights Reserved |