CEO’s review
According to the Kojamo plc’s Financial Statements Release 1 January – 31 December 2024
Total revenue and net rental income grew in 2024, and the fair value of our investment properties stayed at the previous year’s level. FFO decreased due to rising financial and maintenance expenses. Our balance sheet remained solid.
The oversupply of rental apartments continued, especially in the capital region. However, the rental market is expected to balance out as the number of new residential start-ups is historically low while population growth has accelerated in big cities. Since the summer, we have taken several measures to respond to the intense competitive situation. In the autumn, we achieved a clear turn for the better in renting, despite the usual seasonal variation. The occupancy rate in the last quarter of the year improved by 0.3 percentage points from the previous quarter and was 91.6%. In the coming year, our focus continues to be on improving the occupancy rate.
The saving programme was implemented according to the plan. The programme was started in the autumn of 2023 when we wanted to react to the changed operating environment and to take proactive measures in order to safeguard the company’s strong financial situation and investment grade credit rating. We achieved savings in accordance with the targets from administrative expenses and repairs. Additionally, we significantly reduced investments. Due to the measures taken, our financial situation has remained good, and our credit rating has remained unchanged.
We did not make any new investment decisions last year. In the first half of the year, yet another 354 apartments were completed from previously started projects, and our apartment portfolio grew to 40,973 apartments. In the autumn, we started one development project based on a previously signed preliminary agreement, and we are building 119 apartments in Helsinki. For the time being, we are not acquiring new properties. Instead, we are focusing on increasing total revenue in the existing housing stock.
To support the maintenance of investment grade credit rating, Kojamo’s Board of Directors proposes to the Annual General Meeting in spring that no dividend will be paid for 2024. The company aims to carry out property sales. The funds obtained from the possible sales will be used to repay loans. They may also be used to repurchase own shares and to pay dividends.
Our financial position and liquidity situation remained strong throughout the year. We successfully made financing arrangements totalling EUR 600 million by utilising diverse sources of funding. In addition to the bond tap issuance and bank loan made at the beginning of the year, we concluded a financing agreement of EUR 150 million with a new financier in December. Our financial position is secured, and the loans maturing this year have been covered. The next financing arrangements will be for maturities in 2026.
Developing the customer experience is one of our key focus areas. The Net Promoter Score (NPS), which measures customer satisfaction, was 54 at the end of the year, showing a four-point improvement from the previous year. The positive development was especially due to the determined efforts to improve the multichannel capabilities and the efficiency of Lumo service centre as well as due to the development of close collaboration with our new property maintenance partners. For our residents, these efforts have been reflected in a faster and smoother service.
The operating environment remained challenging, but we developed our operations with determination and strived to respond actively to the market situation. I would like to thank the personnel for their exceptional work and ability to renew our operations. I also thank all customers, partners and shareholders for their cooperation and trust in the company.
Erik Hjelt
Interim CEO
Page updated 13 February 2025