Aalborg, Denmark, 2017-06-16 08:45 CEST (GLOBE NEWSWIRE) --
Summary
Financial performance in Q1 2017/18
The profit before tax for Q1 2017/18 was DKK 0.1 million, as compared with a loss of DKK 4.1 million in Q1 2016/17. The loss after tax was DKK 0.9 million compared with a loss of DKK 3.7 million for Q1 2016/17.
Total assets amounted to DKK 2,893.9 million at 30 April 2017 against DKK 2,852.9 million at 31 January 2017. Consolidated equity stood at DKK 1,296.8 million at 30 April 2017, corresponding to a solvency ratio of 44.8%.
Breakdown by segment:
| DKKm | Property development | Asset management | Unallocated |
| Profit/loss | |||
| Profit/loss before tax | 4.5 | -1.6 | -2.8 |
| Balance sheet | |||
| Development projects | 955.8 | - | - |
| Completed properties under asset management | - | 1,174.0 | - |
| Other asset management projects | - | 108.7 | - |
| Other assets | 320.7 | 259.4 | 75.3 |
| Total assets | 1,276.5 | 1,542.1 | 75.3 |
| Tied-up equity | 711.3 | 527.9 | 57.6 |
Outlook for 2017/18
Management still expects a profit of DKK 100-120 million before tax for 2017/18, assuming a return on equity ratio of about 15% for the Group’s property development activities.
This forecast is based on Management's expectations, including time estimates, for a number of specific projects. Several of the Group’s major development projects have been sold in whole or in part and are expected to contribute to the current financial year’s results, including Strædet, Køge, Denmark, and the Amerika Have residential project in Copenhagen, Denmark. TK Development is recording good progress on the individual projects.
Property development
TK Development handed over a retail park of about 3,200 sqm in Oskarshamn, Sweden, to the investor in the first quarter of 2017/18. In addition, TK Development sold a few minor plots of land and also generated fee income on a few projects.
Major development projects:
- Construction of BROEN Shopping, the new shopping centre in Esbjerg, Denmark, has been completed, and the centre opened as scheduled on 10 April 2017. The current occupancy rate is 91% of the total space (Q4 2016/17: 88%).
- The construction project in Køge, Denmark, is moving ahead. The project will be handed over to the investor in three phases. The first phase, comprising a cinema and restaurants, was completed in May 2017 and will be handed over to the buyer in July 2017. The main part of the project is still expected to be completed and handed over in autumn 2017, while a minor part is scheduled for completion in 2018. The retail project, of which 88% has been let (Q4 2016/17: 86%), has been sold under a conditional sale agreement to Finnish-based Citycon together with the parking facilities. The sale to Citycon is still expected to have a significant positive impact on results for the 2017/18 financial year as the completed part of the project is handed over to the investor.
- Construction of the Amerika Have residential project in Copenhagen, Denmark, was completed shortly after the reporting date, and the apartments that have been sold were handed over to the buyers in May 2017. 114 of the 121 apartments have been sold (Q4 2016/17: 104).
- Construction of the third phase of the Bielany residential project in Warsaw, Poland, is progressing according to plan, as is the pre-completion sale. 54% (Q4 2016/17: 45%) of the residential units have been sold.
Asset management
The portfolio of completed properties in this business area, including joint venture projects, consists of 156,700 sqm and represented a value of DKK 1,593.1 million at 30 April 2017. Based on the current occupancy rate, annual net rent corresponds to a return on the carrying amount of 4.4% (Q4 2016/17: 4.3%). Based on full occupancy, the return on the carrying amount is estimated at 6.2% (Q4 2016/17: 6.2%).
Detailed development and operating plans have been drafted for each property, and the plans are generally progressing as planned.
The expectations stated in this interim report, including earnings forecasts, are inherently subject to risks and uncertainties, and actual results may differ from the guidance provided. Expectations may be impacted by factors generally affecting the sector as well as the factors referred to under Risk management and in note 2 to the consolidated financial statements in the Group’s annual report for 2016/17, Accounting estimates and judgments, including the valuation of the Group’s project portfolio.
Any questions regarding this interim report may be directed to Frede Clausen, President and CEO, tel. +45 8896 1010.
