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2016-11-09

Hemfosa Fastigheter AB: Interim report January - September 2016

This information is information that Hemfosa Fastighter AB is obliged
to make public pursuant to the EU Market Abuse Regulation and the
Securities Markets Act. The information was submitted for
publication, through the agency of the contact person set out below,
at 07.30 CET on November 9, 2016.

STRONG PLATFORM FOR CONTINUED GROWTH

THE QUARTER - JULY-SEPTEMBER 2016

· Rental income amounted to MSEK 666 (615)

· Profit from property management totaled MSEK 582 (345),
corresponding to SEK 3.52 per ordinary share (2.35)

· Profit after tax amounted to MSEK 1,389 (587), corresponding to SEK
8.59 per ordinary share (4.13)

· Cash flow from operating activities was MSEK 398 (291),
corresponding to SEK 2.35 per ordinary share (1.96)

INTERIM PERIOD - JANUARY-SEPTEMBER 2016

· Rental income amounted to MSEK 1,958 (1,819)

· Profit from property management totaled MSEK 1,275 (958),
corresponding to SEK 8.23 per ordinary share (6.48)

· Profit after tax amounted to MSEK 2,746 (1,766), corresponding to
SEK 19.40 per ordinary share (12.34)

· Recognized property value of SEK 33.0 billion (28.4) pertains to 418
(369) directly owned properties

· Net asset value (EPRA NAV) per ordinary share was SEK 88.40 (71.61)

· Cash flow from operating activities was MSEK 812 (824),
corresponding to SEK 5.03 per ordinary share (5.50)

SIGNIFICANT EVENT DURING AND AFTER THE QUARTER

· In total, Hemfosa took possession of four properties in the care
services and school segments during the quarter at an underlying
property value of approximately MSEK 390.

· Streamlining of the property portfolio continued and Hemfosa vacated
three units in the Other properties area during the quarter at an
underlying property value of MSEK 126.

· During the quarter, Hemfosa established a direct presence in Finland
by employing Pasi Nieminen as Head of Property Management with
responsibility for the Finnish property portfolio.

· After the end of the quarter, Hemfosa acquired and took possession
of two properties in Espoo, Finland, with the police authority and
the office of the public prosecutor as the largest tenants. The
property value amounted to approximately MSEK 420.

· Joacim Sjöberg took office as Deputy CEO on October 3.

COMMENTS FROM THE CEO

Hemfosa reports a very strong third quarter; both profit from property
management and comprehensive income improved considerably and
earnings increased. At the same time, we are continuing to conduct
long-term and structured work to strengthen our position as
specialists in community service properties and we have acquired
community service properties for more than SEK 2.2 billion to date
this year. We are financially strong and both equipped and ready to
capitalize on attractive acquisition opportunities.

A CHALLENGING ACQUISITION MARKET
We know what we are looking for and, as always, we are selective in
our acquisitions. In the challenging Swedish property market in which
Hemfosa is currently active, our assessment is that pricing on the
supply side is high. As a result, we opted to abstain from a number
of transactions during the quarter when we concluded that the price
tag was too high. In fact, we have never abstained from as many
transactions due to pricing as we have this year. This is
particularly apparent in Sweden, with a highly liquid market and with
many new players, not least financial investors. We are beginning to
see a similar trend in the Norwegian market, while we view the
competitive situation for community service properties as somewhat
less intensive in Finland. Since Hemfosa started to focus on
community service properties at an early stage, we have relatively
quickly accumulated knowledge that we believe will give us strength
to decide correctly whether to buy or pass. Everyone who knows
Hemfosa is aware that we are keen on implementing interesting
acquisitions but, in the final analysis, it is always about ensuring
that we can add value for the shareholders.

Hemfosa has a long-term strategy and an alert organization. We
continue to methodically analyze all business opportunities of
interest and the pace is high. We're building close partnerships with
established community players that have operations with which we can
grow, such as large school and care companies, municipalities and
county councils. We're identifying complex and unconventional
transactions, such as portfolios comprising a variety of property
types, in which our experience and financial capacity gives us
strength. Viewed as a whole, this means that we have a solid platform
for continued growth.

At the same time, we're continuing to manage and add value to
Hemfosa's existing property portfolio, with a property value of
approximately SEK 33 billion at period-end. During the quarter, our
investment activity was high. This autumn, for example, we are
refurbishing previously vacant floor space for new tenants in Mölndal
and for hotel operations, among other activities, in Haninge, where
we are also working to establish care service operaions in parts of
the property.

A STRONGER ORGANIZATION
Hemfosa is continuing to build an organization with skilled employees
adapted to a growing operation. We announced during the quarter that
we as of October 3rd are strengthening Group Management with Joacim
Sjöberg as Deputy CEO. We have also strengthened other important
functions in the company, in both financing and property management
and, in Finland, Pasi Nieminen has been employed as Head of Property
Management.

Following a relatively calm quarter in terms of transactions, we now
want to proceed by getting more capital to work. With strong
financial performance figures and good access to capital, Hemfosa has
all the prerequisites to take the next step in its growth in
community service properties. We believe that attractive business
opportunities will arise, and then we will be prepared - financially,
organizationally and mentally.

Jens Engwall, CEO

For further information, please contact:

Jens Engwall, CEO, jens.engwall@hemfosa.se, mobile +46 70 690 65 50

Karin Osslind, CFO, karin.osslind@hemfosa.se, mobile +46 70 794 93 37

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http://news.cision.com/hemfosa-fastigheter-ab/r/interim-report-january--...
http://mb.cision.com/Main/7964/2118436/587068.pdf

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