Eik fasteignafélag hf.: Condensed Interim Financial Statement for the first three months 2025

Condensed Interim Financial Statement of Eik fasteignafélag hf. the period 1. January to 31. March 2025 was approved by the Board of Directors and the CEO on 8th of May 2025

The main results from the Condensed Interim Financial Statements are as follows:

• Income from operations amounted to ISK 2,964 million
  • Thereof, rental income amounted to ISK 2,589 million and has increased 9.5% between years.
• Operating profit before changes in fair value, sales gain and depreciation and amortization amounted to 1,817 million.
• Total comprehensive profit amounted to ISK 1,366 million.
• Net cash from operations amounted to ISK 1,038 million.
• The book value of investment properties amounted to ISK 147,606 million. 
• The book value of assets for own use amounted to ISK 5,816 million
• Change in value of investment properties amounted to ISK 1,532 million.
• Cash and cash equivalents amounted to ISK 5,44 million.
• Interest-bearing debt amounted to ISK 87,366 million
• Equity ratio was 33.6%.
• Earnings per share was ISK 0.4.
• Economic occupancy rate was 94.3%.
• Weighted indexed interest was 3.50%.
• Weighted unindexed interest was 7.67%.
• The loan-to-value ratio (net interest-bearing debt / value of real estate, building permits and plots) was 54.6% at the end of the period.

In case of any discrepancy in the English and the Icelandic versions of this announcement or the Financial Statements, the Icelandic version shall prevail.

Attached is the Interim Consolidated Financial Statements for the first nine months of the year 2024.

New CEO

Hreiðar Már Hermannsson took over as CEO of the Company from Garðar Hannes Friðjónsson following the annual general meeting on April 10th.

Operation of the period

There was strong growth in the Company's revenue and EBITDA in the first three months of the year, and operations were in line with budget. The Company's operating revenue amounted to ISK 2,964 million in the first three months of 2025, an increase of 9.4% compared to the same period in 2024. Of this, rental income was ISK 2,589 million, with a real growth of 4.7% year-on-year. Operating expenses amounted to ISK 1,147 million.

Operating profit before valuation changes, sales gain and depreciation and amortization amounted to ISK 1,817 million compared to ISK 1,700 million in the same period the previous year, an increase of 6.9%. Profit before income tax amounted to ISK 1,708 million, and the total profit of the Group in the first three months of 2025 amounted to ISK 1,366 million.

The Net Operating Income (NOI) ratio (i.e., operating profit before valuation changes and depreciation as a percentage of rental income) was 69.6% in the first three months of 2025 compared to 71.0% for the same period in 2024.

Balance sheet

The Company's total assets amounted to ISK 160,890 million on March 31, 2025. Of this, investment properties were valued at ISK 147,606 million, and assets for own use amounted to ISK 5,816 million. The Company's equity amounted to ISK 54,027 million at the end of the period, and the equity ratio was 33.6%. At the Company's annual general meeting on April 10, 2025, it was approved to pay out dividends to shareholders for the financial year 2024 amounting to ISK 3,393.4 million. The payment was approved to be in two instalments. The first payment amounting to ISK 1,696.7 million was paid to shareholders on April 23, 2025, and the second payment of the same amount will be paid on October 8, 2025. The equity position as of March 31, 2025, does not take these obligations into account.

The Company's total liabilities amounted to ISK 106,863 million on March 31, 2025. Of this, interest-bearing liabilities were ISK 87,336 million, and deferred tax liability were ISK 14,492 million. The Company's loan-to-value ratio, i.e., the net position of interest-bearing liabilities against the value of real estate and building permits, was 54.6%. The Company issued a new bond series, EIK 150536, at the beginning of February 2025. The series carries 3.8% inflation-indexed interest and was sold for ISK 4,000 million at the beginning of February and ISK 2,000 million at the end of February. The total size of the series after the increase was thus ISK 6,000 million, but its maximum size is ISK 10,000 million. Part of the financing was used to pay down less favorable bank financing. The proportion of inflation-indexed loans was nearly 97.3% at the end of the first quarter of 2025.

The Company's Real Estate Portfolio

The Company sold Rauðarárstígur 27 at the end of February and handed over the property at the same time. The property had mostly been vacant since the tenant left last summer. The sales gain of the property amounted to approximately ISK 42 million.

Glerártorg in Akureyri had been in a non-binding offer process since the end of 2024, but at the beginning of March 2025, it was announced that the offer process had ended as it did not yield satisfactory results for the Company. There are significant opportunities in the property and the surrounding land, and the Company will continue to develop the square into the main center for shopping and services in North Iceland with further development along with the planned residential construction that supports the area.

Negotiations for the acquisition of Festing hf. are progressing, and it is expected that a conclusion will be reached in the second quarter. If the acquisition goes through, Eik's real estate portfolio will increase by over 43 thousand square metres.

The Company's Occupancy Rate

The Company's leasing performed well in the first quarter, increasing by 0.7 percentage points from the beginning of the year and was 94.3% at the end of the quarter.

The Company signed lease agreements with new and existing tenants for nearly 6,700 square metres. Notable agreements include the lease of the entire 2nd floor of Skeifan 8, the expansion of a tenant in Holtasmári 1, lease agreements for approximately 700 square metres in Smáratorg 3, and about 500 square metres in Kvosin. Additionally, the Company received nearly 4,600 square metres back from leasing in the quarter.

Unchanged Outlook

The Company's outlook for 2025 remains unchanged from what was published on February 5th. According to the financial plan for 2025, the Company forecasts that its operating revenue will be in the range of ISK 12,055 – 12,545 million at constant prices based on the consumer price index in January 2025. Of this, rental income is estimated to be in the range of ISK 10,375 – 10,800 million, and based on the median forecast, the Company expects approximately 5% real growth in rental income. The Company also estimates that EBITDA for the year will be in the range of ISK 7,620 – 7,940 million.

The Company's goal is that by the end of 2025, its occupancy rate will have reached 95%, along with having signed agreements for 6,400 square metres of development space in addition to the 4,600 square metres of development space already signed. If these plans materialise, the Company expects that on an annual basis, rental income based on the current asset portfolio will increase by ISK 540 – 570 million according to the aforementioned forecast.

The company's offices are moving to Turninn, Smáratorg 3

The company's offices will be moving to Turninn, Smáratorg 3 in the coming weeks. 

Briefing session

An open briefing session for market participants will be held on Friday, May 9, 2025, at 8:30 AM at VOX Club on the 1st floor of Hilton Reykjavík Nordica, Suðurlandsbraut 2. A light breakfast will be offered from 8:00 AM. Hreiðar Már Hermannsson, CEO, and Lýður H. Gunnarsson, CFO, will present the results and answer questions after the presentation.

The meeting will also be streamed online, and registration for the virtual meeting can be done here:

https://vimeo.com/event/5112883/0ba649934b

Following registration, participants will receive an e-mail with further information.

Market participants can submit questions for or at the meeting to the email address fjarfestatengsl@eik.is. Questions will be answered after the presentation.

Changed Financial Calendar

Following are planned dates for publishing of interim and annual results:

Quarterly results Q2 2025                                          13. August 2025
Quarterly results Q3 2024                                          29. October 2025
Management 2025 result and 2026 budget               5. February 2026
2025 Annual Result                                                    12. March 2026

The publication of financial information will take place after market closure. Attention is drawn to the changed dates of interim financial statements.

Further information will be provided by:

Hreiðar Már Hermannsson CEO, hreidar@eik.is, tel. 856-5907
Lýður H. Gunnarsson CFO, lydur@eik.is, tel. 820-8980

Attachment

• Q1 2025 Condensed consolidated interim financial statement