Suomen Hoivatilat Oyj: Revenue grew by almost 70 %, strong operational result
Suomen Hoivatilat Plc
Stock Exchange Release, 13 February 2018, at 8:00 a.m. (EET)
Suomen Hoivatilat Oyj
Financial Statements Bulletin for 2017 (unaudited)
Revenue grew by almost 70 %, strong operational result
Financial Statements Bulletin for 2017
Suomen Hoivatilat Oyj stock exchange release, 13/02/2018, 8:00 a.m.
January-December 2017 in brief (January-December 2016 in brackets for comparison)
Revenue: EUR 12.4 (7.4) million, growth 66.9%
Profit for the financial year: EUR 25.5 (14.7) million, growth 73.5%
Operational result: EUR 5.4 (2.9) million, growth 90.7%
Earnings per share, undiluted: EUR 1.05 (0.75), growth 40.0%
Earnings per share, diluted: EUR 1.04 (0.75), growth 38.7%
Operational result per share: EUR 0.22 (0.15), growth 46.7%
Value of investment properties: EUR 247.1 (154.8) million, growth 59.7%
Economic occupancy rate: 100% (100%)
Net asset value (NAV) per share: EUR 5.67 (4.00), growth 41.8%
Value of the agreement portfolio (no index increases): EUR 316.0 (214.2) million, growth 47.5%
Average maturity of the agreement portfolio: 14.4 (14.2) years.
July-December 2017 in brief (July-December 2016 in brackets for comparison)
Revenue: EUR 7.1 (4.0) million, growth 74.3%
Profit for the period: EUR 10.7 (8.1) million, growth 33.0%
Operational result: EUR 3.3 (1.6) million, growth 113.0%
Earnings per share, undiluted: EUR 0.42 (0.39), growth 7.7%
Earnings per share, diluted: EUR 0.42 (0.39), growth 7.7%
Operational result per share: EUR 0.13 (0.07), growth 85.7%
Financial guidance for 2018
The company expects its total revenue to reach at least EUR 17.5 million in 2018. The operating profit is expected to amount to approximately 40 per cent of the revenue. The fair value of investment properties is expected to be at least EUR 340 million at the end of 2018.
The guidance is based on the assumption that the company will not have any significant purchases or sales of ready investment properties in 2018 and that the return requirements used for valuation remain at their present level.
Jussi Karjula, CEO:
For Hoivatilat, 2017 was a year with significant quantum leaps of growth. During the year, all key indicators improved considerably: revenue grew by almost 70%, the value of investment properties increased by approximately 60% and operating profit by more than 70%. The return on equity - an indicator important to shareholders - was also excellent at 25%. During the year, we implemented 34 projects regarding facilities for early education and care services. The number of our employees increased, and our cooperation network expanded further. We succeeded well in serving our long-term partners and in winning new customers.
For many years now, Hoivatilat has been a strong actor in kindergarten, nursing home and service block projects. We have implemented or started approximately 80 kindergarten projects and approximately 50 nursing home projects for different target groups in more than 50 municipalities. As a new opening, we published the "Investment-free school" concept in September 2017. The new curriculum will speed up the renewal of learning environments. Studying will increasingly focus on learning by doing, problem-solving and the students' own deliverables. Our school concept provides one solution to this need for change.
Aged properties with their inherent problems will also speed up the process of reforming the facilities. In addition to technically flexible facility solutions, the models of ownership and real estate management are also undergoing a change. The facilities can be rented and the responsibility for their life span can be borne by a private operator so that rather than concentrating on walls, the municipality can concentrate on its core mission, the production of good services. Hoivatilat is actively participating in this change process. Last autumn, we initiated the first life span project of Hoivatilat, implemented for the Municipality of Siilinjärvi with a 20-year lease and maintenance agreement.
Material events during the review period
During the financial period, a total of 34 (18) new real estate properties were completed, seven in Uusimaa, four in the Kouvola region, three in the Turku region and two in each of the regions of Tampere, Oulu, Kuopio and Lahti. Individual properties were implemented in several locations including Jyväskylä, Kajaani, Mikkeli, Kokkola and Tornio. Furthermore, a service block consisting of three real estate properties was completed in Uusikaupunki.
On 1 March 2017, the company was moved from the market place of First North to the list of Nasdaq Helsinki. The move was driven by the aim to increase the company's auspiciousness, to improve the liquidity of its shares and to involve new owner groups. At the end of March, the company carried out a shares issue directed at institutional investors where 4,500,000 new shares were subscribed and EUR 31.5 million of new capital was collected before expenses. In addition, the issue significantly improved the company's possibilities to increase its real estate portfolio. The issue introduced notable investors into the company's owner base from Sweden, Norway and the UK, in addition to Finland. The investors' interest in Hoivatilat remained strong throughout the year, and at the end of the financial period, the company already had over 8,200 shareholders.
Events after the review period
No material events after the review period.
Financial goals for 2018-2020
Hoivatilat expects an annual revenue growth of at least 40% in 2018 and at least 30% in 2019-2020. The operational result is expected to be on average 40% of revenue and the equity ratio to be on average 35% in 2018-2020.
The Board of Directors' proposal regarding distribution of profits
At the end of the financial period, the parent company's distributable funds stood at EUR 42,472,257. The Board proposes to the GM convening on 27 March 2018 that the company's distributable funds are used so that a dividend of EUR 0.13 per share is paid, i.e. a total of EUR 3,287,551.67 on the basis of the number of shares on the balance sheet date. The proposed dividend corresponds to approximately 60.5% of the operational result for the financial period.
According to Hoivatilat's dividend distribution policy, the goal is to distribute at least 50% of the operational result as dividends every year. If dividends are paid, all the company's shares entitle to equal dividends. The operational result describes the profitability of the company's business operations without the effect of changes in the fair values of real estate properties. In keeping with the dividends, policy, the company's distribution of dividends is based on the operational result.
There have not been any material changes in the financial position of Hoivatilat after the end of the financial period. The liquidity of Hoivatilat is good, and the company's Board of Directors is of the opinion that the proposed distribution of dividends will not compromise the company's liquidity.
General Meeting of 2018
The Ordinary General Meeting of 2018 will be held in Oulu on 27 March 2017 starting at 3:00 p.m.
Financial communications in 2018
Hoivatilat will publish the Financial Statements Bulletin for 2017 on 13 February 2018. The stock exchange release an materials in Finnish and English will be published at that time on the company's website at www.hoivatilat.fi/en/investors The company will organise a results announcement event in Helsinki on 13 February 2018.
The Business Review for January-March 2018 will be published on 3 May 2018. The Six-month Review of Hoivatilat for January-June will be published on 16 August and the Business Review for January-September on 1 November 2018.
Suomen Hoivatilat Plc
Board of Directors
Suomen Hoivatilat Plc, Jussi Karjula, CEO, email@example.com, tel. +358 40 773 4054
Hoivatilat in brief:
Suomen Hoivatilat specialises in producing, developing, owning and leasing out daycare centre and nursing home premises, service blocks and schools. Hoivatilat was established in 2008 and cooperates with around 50 Finnish municipalities. It has completed over 100 real estate projects throughout Finland. The company was listed on Nasdaq OMX Helsinki on 1 March 2017.