Due to the prevailing situation on the stock market, Castellum has been flooded with questions from investors and market players which we unfortunately, owing to volatile circumstances, do not have the possibility to answer in full. We would therefore like to transmit this comprehensive fact commentary out to the equities market.
The stock market's pricing of the Castellum share is currently SEK 151, indicating at this time of writing that Castellum is now valued at approx. 77% of its long-range Net Asset Value at last yearend and that the yield amounts to 4.3%, based on the 2019 dividend of SEK 6.50 that the AGM decided upon yesterday. It is apparent that this valuation reflects strong concerns about very weak development for Castellum going forward. These concerns are not specific for Castellum, but for the industry in general. Against this background, Castellum considers it crucial to remind investors of the following.
Each crisis is unique, but there are always common factors, where securing human as well as financial resources is important, and should be attended to in such a way that does not damage Castellum in the long run. At this time of writing, Castellum has strong financial muscles and unutilized credits which will adequately cover all eventualities in 2020 and a little into 2021, while assuring sufficient fiscal elbow room for meeting operational requirements. A loan-to-value ratio of 43%, an interest-coverage ratio of 500%, and a debt/GDP ratio of 10 - all serve to demonstrate a financially solid company.
Castellum's customer structure reflects a sound distribution of segments, wherein a fifth of operating revenues comes from public service authorities and agencies - a stable and secure customer base which represents longer duration contracts in the portfolio. This is also a customer group which is more independent of economic highs and lows, or crises. Our exposure to the currently vulnerable sectors such as hotels and restaurants is low.
The large new construction projects in Malmö are progressing according to plan, where E.ON's Nordic headquarters and the Swedish National Courts Administration building will contribute to Castellum's 2020 net leasing of approx. MSEK 146.
Of course we are aware that Castellum will come up against the wave of issues that now engulfs many companies. The number of bankruptcies in our community will likely rise, and a number of our tenants could run into liquidity issues. To what extent this will occur and how it will affect Castellum is too early to quantify. However, with a strong balance sheet, financial resources in place and a dedicated and action-oriented organization, Castellum has substantial background conditions for standing strong throughout this crisis.
For further information, contact:
Ulrika Danielsson, CFO, Castellum AB (publ) +46 31-60 74 74
Henrik Saxborn, CEO, Castellum AB (publ) +46 31-60 74 50
Castellum is one of the largest listed real estate companies in Sweden. Property values total SEK 95.2 billion and holdings comprise office, warehousing/logistics and public-sector properties, covering a total leasable area of 4.3 million square metres. The real estate portfolio is owned and managed under the Castellum brand through a decentralized organization with strong and clear local presence in 17 cities in Sweden, as well as Copenhagen and Helsinki. Castellum is ranked as the most equal of 600 listed European companies by European Women on Boards 2020. Castellum is the only Nordic real estate and construction company elected to the Dow Jones Sustainability Index (DJSI), joining a select group of companies in the world who perform best on sustainability issues. In 2019, Castellum received two awards for sustainability efforts; designated Number One in the world by GRESB for the offices-and-logistics sector, as well as the Level Gold award for sustainability reporting from the EPRA (European Public Real Estate Association). The Castellum share is listed on Nasdaq Stockholm Large Cap. For further information visit www.castellum.com.