Catena AB (publ) (STO: CATE) Q2 2025 Earnings | 07/04/2025

Catena AB (publ) delivered solid Q2 2025 results in a cautious market, demonstrating continued growth through strategic acquisitions and development projects.

Key Highlights:

• Significant Acquisition: Catena signed an agreement to acquire El Giganten's distribution and central warehouse in Jönköping for SEK 1.275 billion. This off-market transaction will add approximately 200,000 square meters of logistics space leased to El Giganten, with an estimated net operating income of SEK 80 million.

• Strong Financial Performance:

  • Rental income for the first half of 2025 was up 26% year-over-year, largely driven by acquisitions (over 22% of growth) and completed development projects (4.5%).

  • Net operating surplus increased by 31%, and profit from property management rose by 32%.

  • Earnings per share from property management grew by 16% to SEK 13.27.

  • Earnings capacity implies SEK 26.3 per share on a full-year basis, 15% above the previous year.

• Positive Net Letting: Achieved +SEK 16 million in net letting for Q2 and +SEK 63 million for the first six months. The weighted average lease expiry (WALe) is 6.6 years, and the letting ratio stands at 96.5%.

• Stable Property Values: Property values remained stable, with a positive value change of SEK 174 million (0.4% of total portfolio). The average weighted valuation yield exit yield is 5.9%, and EPRA net initial yield is 5.6%.

• Robust Capital Structure:

  • Equity ratio stood at 52%.

  • EPRA NRV per share increased to SEK 428.

  • Net debt to EBITDA at 7.6 times, interest coverage at 4 times, and loan-to-value (LTV) at 38.6%. These figures are well within policy levels, providing flexibility for new investments.

• Financing and Liquidity:

  • Updated MTN program, increasing the framework to SEK 8 billion.

  • Issued SEK 450 million in secured bonds (2-year maturity) in Q2.

  • Completed a SEK 1 billion senior unsecured bond transaction (3- and 5-year maturities) in early July.

  • Average debt maturity is 4.8 years.

  • Strong liquidity with SEK 3.1 billion in cash.

  • Average interest cost is 3.2%.

  • 61% of outstanding debt has fixed interest.

Development and Land Bank:

• Ongoing Project Portfolio: Totals SEK 1.2 billion, with SEK 400 million remaining to invest, which will add 91,000 square meters to the portfolio at a 7% yield.

• Future Development: Approaching adoption of new zoning plans for areas in Skjæra (Ängelholm) in September and Örebro by Q4.

Sustainability Efforts:

• Environmentally Certified Area: Now 57% and expected to increase.

• Scope 3 Emissions: Decreasing due to fewer projects.

• EU Taxonomy Alignment: High level of alignment, with 76% of turnover aligned.

• Solar Energy: Produced approximately 23,000 MWh from solar panels (rolling 12-month basis), with total installed output above 71 MW.

Outlook:

Catena remains focused on its growth journey, leveraging strategic acquisitions, robust project pipeline, and strong financial health to navigate the market. The company sees the real estate transaction and credit markets picking up.