Near-term risks and uncertainties

According to the Kojamo plc’s Interim report 1 January – 31 March 2024

Kojamo estimates that the most significant near-term risks and uncertainties are caused by the uncertain situation in property and financial markets, interest rate development as well as by geopolitical tensions.

Geopolitical tensions, including Russia’s war of aggression in Ukraine and the conflict in the Middle East, have caused economic uncertainty and raised oil prices in the early part of the year, which may also have a wider impact on inflation and interest rates. The uncertainty can also have impacts on the housing and property markets, including apartment prices, rents and yield requirements as well as on the operations of the construction companies. If inflation does not decrease as predicted, the decrease in interest rates may be postponed. The increased costs could affect Kojamo’s result and cash flow as well as the fair value of apartments.

The development of the Finnish economy may affect the housing and financial markets in exceptional ways. These factors may have an impact on Kojamo’s profit and cash flow as well as the fair value of apartments. A general downturn may lead to unemployment and reduce household purchasing power, which in turn may affect the ability of residents to pay rent and, subsequently, the company’s rental income.

The weakening of the property and financial markets as well as the changes in market interest rates may lower Kojamo’s credit rating and increase the price of financing as well as weaken financial key figures. These factors may affect Kojamo’s profit and cash flow, as well as the fair value of the apartments.

Urbanisation is expected to continue in the longer term. The supply of rental apartments may increase locally in the main areas in which Kojamo operates, and the changes in supply and demand could have an impact on Kojamo’s tenant turnover or the financial occupancy rate and, thereby, rental income.

Cyber attacks and various other data security threats have increased. These data security breaches could impact Kojamo’s business operations and the reliability of information systems.

Kojamo’s most significant risks are described in more detail in the report on non-financial information.

A more detailed description of Kojamo’s strategic risks and uncertainties is provided in the Financial Statements 2023.

Read more about Kojamo’s risk management here.

Page updated 8 May 2024