Year-End Report 2017: Strong property market strengthens earnings

Year-end report 2017 in brief:

FULL-YEAR

• Rental revenue was SEK 5,582 million (5,482).
  
  
• Net operating income was SEK 3,829 million (3,667), an increase of SEK 162 million, which is largely attributable to commissioning of new buildings and an additional consideration.
  
  
• Changes in property values with an impact on profit totaled SEK 4,979 million (3,682), corresponding with a 6.8 per cent (5.5) increase in the value of the properties, including projects in progress.
  
  
• Changes in the value of financial instruments amounted to SEK –242 million (-241).
  
  
• Profit before tax for the full year amounted to SEK 8,311 million (6,714) and profit for the year was SEK 6,453 million (5,148).
  
  
• Investment in redevelopment and new construction for the full year totalled SEK 2,555 million (2,761).
  
  
• The yield (excluding properties under construction) was 5.5 per cent (5.7). The decline can mainly be attributed to the increase in property value.

FOURTH QUARTER

• Rental revenue was SEK 1,392 million (1,384).
  
  
• Net operating income totalled SEK 836 million (732).
  
  
• Changes in property values amounted to SEK 1,395 million (1,194).
  The change can primarily be attributed to lower yield requirements.
  
  
• Net interest income improved by SEK 40 million to SEK –29 million.
  
  
• Profit before tax was SEK 2,083 million (2,012). The increase is attributable to changes in value.

In 2017 Akademiska Hus took decisions regarding several major investments for a total of SEK 1,900 million. One example is A Working Lab, which is an innovation arena on the Chalmers campus in Gothenburg and represents an investment of SEK 380 million. About 15 innovation projects will be conducted here during the actual construction period together with a number of partners from academia, institutions and business. In 2019, when the tenants move in, this will be an innovative and sustainable collaborative environment. At the end of the year an investment of SEK 1,200 million was approved for development of the Ångström Laboratory at Uppsala University. Examples of important construction starts in 2017 include the new student building on Campus Valla in Linköping (SEK 400 million), and housing for 400 undergraduate and graduate students at Karolinska Institutet in Solna (SEK 430 million).

Innovation is an important part of strategy at Akademiska Hus and the company is now involved as a partner in several projects that can drive Akademiska Hus forward, while also making a positive contribution to society, especially with regard to climate change and the development of future knowledge environments.

“In 2018, we will also focus on addressing the rapid digitisation of properties and society and take advantage of the opportunities that arise to develop value-adding services for our customers,” says Kerstin Lindberg Göransson, President of Akademiska Hus.

• Finance