Investors House

Country:
Sector:
Market cap (m):
Finland
Construction and Real Estate
EUR 38.82
Bloomberg:
Reuters:
Website:
INVEST FH
INVEST.HE
Share price (close):
EUR 6.28

Latest Reports

3 JAN 2022
Commissioned Research: Flash comment: Large EUR 1 extra dividend and strategy for 2023 confirmed
Investors House announced today that it will propose an extra dividend of EUR 1 (~16% dividend yield) for the EGM on 24 January. After recent asset divestments, Investors House has a cash position of EUR 23m, and EUR 23m of potential loan capacity. Additionally, EUR 2.8m will be used to repay debt and EUR 2.8m to be invested in equity stake in the Kukkula JV in Jyväskylä. This leaves Investors House with EUR 34m of potential investment ammo and in addition, Investors House has authorisation to issue 5m new shares if needed. At the CMD today, Investors House reiterated its 2023 strategy, which aims at a profitability development which enables an increasing dividend. The company will also focus on recurring revenues, which is supported by the fact that service income is now higher than income from property leases. In the coming years, Investors House will focus on development projects on its own or with partners, and on increasing property service business. Furthermore, Investors House will maintain its equity ratio above 45%; in Q3 2021 equity ratio was 49%. Investors House will provide a new guidance for 2022 in conjunction with the Q4 report on 3 March. The CMD does not trigger any estimate changes and we will update our numbers once the EUR 1 extra dividend proposal is approved by the EGM on 24 January.

26 NOV 2021
Commissioned Research: Speeding up capital recycling
On 25 November, Investors House announced the divestment of associated company IVH Kampus to Swedish real estate company Nyfosa for a total consideration of EUR 56.3m. Investors House owns 48% of IVH Kampus and will receive net proceeds of some EUR 15m from the divestment, taking its cash position to EUR 23m. We estimate a negative impact on Investors House's associates line of slightly more than EUR 1m annually, with a -21% impact on our adjusted EBIT for 2022E-23E. The company will use part of the funds to finance the EUR 46m Kukkula JV in Jyväskylä, Finland, of which it owns one-third. Although the negative EPS impact is ~30% in the near term, we believe the dividend growth story is intact and new investments will gradually contribute to earnings. We keep our fair value range unchanged at EUR 5.7-8.0 per share. Marketing material commissioned by Investors House.

25 NOV 2021
Commissioned Research: Flash comment: Divests associated company IVH Kampus and issues a positive profit warning for 2021
Investors House issued a positive profit warning today (25 November) following the sale of associated company IVH Kampus. Investors House now expects the operative result for 2021 to improve significantly from 2020 (previously: operative result to improve). Investors House announced it will sell its associated company IVH Kampus to Swedish real estate company Nyfosa. Investors House owns 48% of IVH Kampus. The transaction will bring Investors House service fees of one-off nature although the divestment will reduce associated company income, which will improve the operative result in Q4 as the deal is expected to close in the quarter. Investors House will continue to manage the IVH Kampus properties for an undisclosed period. The transaction results in realised value changes of EUR -0.7m. The transaction will improve Investors House’s cash position by EUR 15m (after repayment of associated company loans) which will increase the cash position to EUR 23m.The transaction highlights Investors House’s ambition to accelerate recycling of capital and the company recently announced the Kukkula JV in Jyväskylä, Finland, where Investors House owns one-third and will develop the area over the coming 10-15 years to develop e.g. residentials in the Jyväskylä region together with its JV partners. The announced transaction will lower the associated income from 2022 by over EUR 1m annually, we estimate, but will improve the financial position considerably to focus on development projects and continue to expand the service business.

16 NOV 2021
Commissioned Research: Transaction level high; JV moves forward
Investors House reported Q3 revenue of EUR 2.4m, 8% below our EUR 2.6m estimate, while net operating income (NOI) was EUR 1.1m, 17% below our EUR 1.3m forecast. Adjusted EBIT including associates was EUR 1.5m, 12% below our EUR 1.7m estimate. The Q2 operative result was EUR 0.9m and improved by 2% y/y. The share of revenue from Services increased y/y to 54%, from 36%. The EUR 46m Kukkula JV in Jyväskylä should start to generate rental income in 2022. We estimate a EUR 0.7m positive impact on the associated companies line annually, although the long-term potential is more interesting from developing the area, mostly for residential use. With a growing pipeline and a growing Service business, we see good potential for further value creation. Marketing material commissioned by Investors House.

15 NOV 2021
Commissioned Research: Flash Comment: Q3 operationally stable y/y and mix continues to improve
Investors House reported Q3 revenues of EUR 2.4m, compared to our EUR 2.6m estimate. Net operating income was EUR 1.1m versus our EUR 1.3m estimate. The Q3 operative result was EUR 0.9m, up 2% y/y. Reported EBIT of EUR 0.1m included e.g. EUR 0.9m of negative fair value changes due to the sale of a EUR 15.5m residential portfolio below accounted value. The 2021 guidance is reiterated: operating result will improve. On divisional level, Real Estate top line was slightly below our estimates while Services fell short most likely owing to lower AUM in Fund management. EPRA NRV was EUR 8.55 per share, up from EUR 8.11 at the end of Q2 2021. EPRA NRV increased from EUR 8.30 y/y and it is worth keeping in mind that EUR 0.8 dividend (0.27 cash and 0.53 Ovaro shares) has been distributed over the past 12 months. The Services business accounted for 54% of sales and Real Estate for 46% compared to 36% and 64% a year ago, respectively. The increase in Service share of sales comes from e.g. the acquisition of Juhola Asset Management. Investors House’s EUR 46m JV in Jyväskylä is progressing and will start generating rental income during Q4, although more focus will be on developing the area over the years to come Solidity remained strong at 49%. Investors House trades at a 33% discount to EPRA NRV. We expect a neutral to slightly positive share price reaction on Investors House’s Q3 report, mainly owing to the increased EPRA NRV, stable y/y performance and maintained positive guidance for 2021.

17 AUG 2021
Commissioned Research: Operative result improved 28% y/y in Q2
Investors House reported Q2 revenue of EUR 2.5m, 8% below our EUR 2.7m estimate, while net operating income (NOI) was EUR 1.1m, 16% below our EUR 1.3m estimate. The Q2 operative result was EUR 0.8m and improved 28% y/y. Juhola Asset Management, a Finnish real estate asset management company, was incorporated for the first full quarter, boosting the top line. The share of revenue from Services increased y/y to 58%, from 19%. Investors House has signed an agreement to divest a residential project in Vantaa and will book a gain of EUR 2-3m, most likely in 2024. The project to develop an old hospital building in Jyväskylä for other use is progressing and Investors House will own a third of it. With a growing pipeline and a growing Service business, we see good potential for value creation. Marketing material commissioned by Investors House.

16 AUG 2021
Commissioned Research: Flash comment: Investors House – Comparable result improved 28% y/y and EPRA NRV increased q/q
Investors House reported Q2 revenues of EUR 2.5m, compared to our EUR 2.7m estimate. Net operating income was EUR 1.1m versus our EUR 1.3m estimate. The Q2 operative result was EUR 0.8m, up 28% y/. The 2021 guidance is reiterated: operating result will improve. EPRA NRV was EUR 8.11 per share, up from EUR 7.90 at the end of Q1 2021. EPRA NRV declined from EUR 8.60 y/y but it is worth keeping in mind that EUR 0.8 dividend (0.27 cash and 0.53 Ovaro shares) has been distributed over the past 12 months. The Services business accounted for 58% of sales and Real Estate for 42% compared to 19% and 81% a year ago, respectively. The increase in Service share of sales comes from e.g. the acquisition of Juhola Asset Management and the accounting change of the real estate fund as ownership declined below 50% . The new reporting structure has been in place since Q3 2020. Several projects progressed during and after the quarter, while the planned real estate loan fund preparation was terminated, which will reduce personnel costs going forward. Solidity remained strong at 47.5%. Investors House trades at a 27% discount to EPRA NRV. We expect a neutral to slightly positive share price reaction on Investors House’s Q2 report, mainly owing to the increased EPRA NRV and maintained positive outlook for 2021.

12 MAY 2021
Commissioned Research: Expanding in Real Estate and Services
Investors House reported Q1 revenue of EUR 1.9m, clearly above our EUR 1.4m estimate, while net operating income was EUR 0.4m, below our EUR 0.7m estimate. The Q1 operative result of EUR 0.1m was virtually flat y/y, burdened by property taxes for the full year being paid in the quarter and by investments in new business and an increased headcount. The acquired Juhola Asset Management, a Finnish real estate asset management company, was incorporated for only three weeks in Q1. The acquisition will increase the share of Services business sales to more than 50% of group sales after Q1. In April, Investors House announced it is part of a consortium that is preparing to acquire an old hospital (85,000 m2 for EUR 46m). This should open up property development potential for the next five to ten years. With a strong Service business and a growing development pipeline, we see good growth potential for Investors House. Marketing material commissioned by Investors House.

11 MAY 2021
Commissioned Research: Flash Comment: Investors House – Somewhat weak Q1 but guidance is for result to improve in 2021
Investors House reported Q4 revenues of EUR 1.9m, 39% ahead of our EUR 1.4m estimate. Net operating income was EUR 0.4m, 45% below our EUR 0.7m estimate. The Q1 operative result was EUR 0.1m, up 3% y/y and was burdened by investments into new businesses (recruitments) and by the fact that property tax is fully accounted for in Q1. The reported Q1 net result of EUR -0.5m included EUR -0.6m of negative fair value changes. EPRA NRV was EUR 7.90 per share, up from EUR 7.60 at the end of Q4 2020. The Services business accounted for 39% of sales and Real Estate for 61%. After Q4, Investors House announced the acquisition of Juhola Asset Management, which will increase the share of sales and NRV contribution from Service. The acquisition impacted Q1 for only three weeks. Solidity remained strong at 52%. On Friday 7 May, Investors House reintroduced its guidance. For 2021, Investors House now guides for the operative result to improve from 2020, which is in line with our expectations. Investors House trades at a 25% discount to EPRA NRV. We expect a slightly negative share price reaction on the back of the somewhat weak Q1.

9 MAR 2021
Commissioned Research: Increasing Services' exposure through M&A
Investors House reported Q4 revenues of EUR 1.73m, largely in line with our estimates. Net operating income was EUR 0.83m, 20% below our EUR 1.04m estimate. The Q4 operative result of EUR 0.51m was down 24% y/y and was burdened by investments in new business and increased headcount. More importantly, Investors House announced at the end of February that it will acquire Juhola Asset Management Oy, a Finnish real estate asset management company. We have incorporated the acquisition into our estimates from Q2 2021. The acquisition will increase the share of Services business sales to close to 60% of group sales. We believe the move is logical and will bring diversification and stability. The property holdings will still form over 50% of the company's value going forward, we estimate. Marketing material commissioned by Investors House.

Equity analysts

Director
Senior Analyst, Sector Coordinator

Key persons

CEO: Petri Roininen

CFO: Matti Leinonen

Chairman: Tapio Rautiainen

Numbers
Export to Excel
Nordea
EURm
2017
2018
2019
2020
2021E
2022E
2023E
Total revenues
6,449.0
8,276.0
11,461.0
9,465.3
9,558.4
10,136.4
10,589.1
Ebitda (adj.)
3,394.00
3,611.00
5,273.00
333.36
3,949.16
4,273.26
4,487.34
Ebitda - margin
52.6%
43.6%
46.0%
3.5%
41.3%
42.2%
42.4%
EBIT (adj.)
3,394.0
3,611.0
5,273.0
333.4
3,949.2
4,273.3
4,487.3
EBIT (adj.) margin
52.6%
43.6%
46.0%
3.5%
41.3%
42.2%
42.4%
PTP (adj.)
2,972.0
3,020.0
4,060.0
-782.6
3,356.5
3,699.3
3,893.4
Net profit from cont oper (adj)
2,460.00
1,072.00
3,391.54
-1,103.50
3,192.90
3,469.43
3,650.63
Shareholders´ Equity
46,128.0
46,815.0
43,477.0
37,562.0
33,833.0
34,295.1
34,738.3
Net interest bearing debt
24,266.0
35,017.0
16,081.0
19,505.0
7,268.9
9,658.9
11,320.3
Net gearing
52.6%
70.8%
36.0%
50.4%
20.2%
25.8%
29.1%
Net debt/EBITDA
4.1
7.5
4.1
n.a.
5.3
2.3
2.5
Free cash flow to equity
2,449.0
-4,909.7
-11,500.2
-2,205.4
13,905.3
-597.1
255.1
Diluted number of shares in issue, year-end (m)
6,182.3
6,182.3
6,182.3
6,182.3
6,182.3
6,182.3
6,182.3
Nordea Markets estimates published on Nov 26, 2021
Source: Company data, Nordea estimates
Per share data and multiples
Export to Excel
Nordea
EUR and %
2017
2018
2019
2020
2021E
2022E
2023E
EPS (adj.)
0.55
0.17
0.48
-0.18
0.36
0.40
0.42
EPS (adj.) growth
-3.2%
-68.4%
176.0%
-137.3%
304.4%
9.5%
4.7%
DPS
0.21
0.23
0.25
0.27
0.29
0.31
0.33
BVPS
7.5
7.6
7.0
6.1
5.5
5.5
5.6
P/E (adj.)
n.a.
34.6
13.5
n.a.
17.2
15.7
15.0
EV/Sales
n.a.
9.04
4.99
5.90
6.35
6.32
6.31
EV/EBITDA (adj.)
n.a.
20.71
10.84
167.64
15.36
14.99
14.88
EV/EBIT (adj.)
n.a.
25.28
9.76
17.94
22.07
18.58
18.41
P/BV
n.a.
0.79
0.92
0.94
1.15
1.13
1.12
Dividend yield
n.a.
3.8%
3.9%
4.7%
4.6%
4.9%
5.3%
FCF Yield bef A&D, lease adj
n.a.
0.7%
3.9%
2.3%
-0.2%
6.2%
5.8%
RoE
14.9%
4.6%
3.7%
-3.8%
-1.0%
6.6%
6.8%
ROIC
4.8%
3.6%
5.7%
0.4%
n.a.
7.4%
7.2%
Nordea Markets estimates published on Nov 26, 2021
Source: Company data, Nordea estimates

Source: Refinitiv