As at 31 March 2017 the GAV of the Fund increased to EUR 169.0 million (EUR 154.9 million as at 31 December 2016). The increase is mainly related to the closing of the acquisition of the Duetto I office building in Q1 2017.
As of 31 March 2017, the Fund NAV was EUR 76.5 million, compared to EUR 76.8 million as at 31 December 2016. The decrease in NAV is mainly related to a distribution to investors made in February. The average actual occupancy of the portfolio was 96.7% and with all rental guarantees 97,6% (96.5% during Q1 2016). Average Direct Property Yield during Q1 was 7.1% (7.0% during Q1 2016). The uptick is mainly due to improved performance and rental indexations across the portfolio.
During Q1 2017, the Fund recorded a net profit of EUR 950 thousand (EUR 864 thousand during Q1 2016) which had a positive effect on the Fund NAV. The net result was positively affected by the operational performance of the properties. On the other hand, the net profit was negatively affected by the recognition of a deferred tax charge on the revaluation of the land plot of Upmalas Biroji which was not recognized in prior periods. The Group recognized the deferred tax liability during the first quarter of the year (negative effect of EUR 452 thousand). Management is not considering to dispose of the Upmalas Biroji property in a near future, therefore, the deferred tax charged in Q1 2017 is not expected to materialize in the near term. Also, the net profit was negatively affected by the additional costs charged for the second public offering in Stockholm (EUR 202 thousand during Q1 2017). These one-off costs were more specifically related to establishing the connection to allowing trading between the Stockholm and the Tallinn stock exchanges through Swedish central depositary, Euroclear Sweden AB.
In Q1 2017, the net rental operating income (NOI) earned by the Group amounted to EUR 2.5 million and was higher than in Q1 2016 when the Group earned EUR 1.4 million. Compared to Q1 2016, the increase in NOI is related to rental income earned on new acquisitions and, to a lesser extent, the indexation of rents.
STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
| Euro ‘000 | 01.01.2017-31.03.2017 | 01.01.2016-31.03.2016 |
| Rental income | 2,727 | 1,619 |
| Service charge income | 924 | 621 |
| Cost of rental activities | (1,125) | (803) |
| Net rental income | 2,526 | 1,437 |
| Administrative expenses | (730) | (182) |
| Other operating income / (expenses) | 13 | - |
| Operating profit | 1,809 | 1,255 |
| Financial income | 41 | 4 |
| Financial expenses | (332) | (280) |
| Net financing costs | (291) | (276) |
| Profit before tax | 1,518 | 979 |
| Income tax charge | (568) | (115) |
| Profit for the period | 950 | 864 |
| Other comprehensive income to be reclassified to profit or loss in subsequent periods | ||
| Net gains (losses) on cash flow hedges | 138 | (37) |
| Income tax relating to net gains (losses) on cash flow hedges | (17) | 7 |
| Other comprehensive income/ (expense), net of tax, to be reclassified to profit or loss in subsequent periods | 121 | (30) |
| Total comprehensive income/ (expense) for the period, net of tax | 1,071 | 834 |
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
| Euro ‘000 | 31.03.2017 | 31.12.2016 |
| Non-current assets | ||
| Investment properties | 156,538 | 141,740 |
| Investment property under construction | 2,218 | 1,580 |
| Derivative financial instruments | 22 | - |
| Other non-current assets | 82 | 288 |
| Total non-current assets | 158,860 | 143,608 |
| Current assets | ||
| Trade and other receivables | 1,282 | 1,269 |
| Prepayments | 235 | 178 |
| Cash and cash equivalents | 8,641 | 9,883 |
| Total current assets | 10,158 | 11,330 |
| Total assets | 169,018 | 154,938 |
| Equity | ||
| Paid in capital | 66,216 | 66,224 |
| Own units | - | (8) |
| Cash flow hedge reserve | (173) | (294) |
| Retained earnings | 10,463 | 10,887 |
| Total equity | 76,506 | 76,809 |
| Non-current liabilities | ||
| Interest bearing loans and borrowings | 50,662 | 58,981 |
| Deferred tax liabilities | 5,001 | 4,383 |
| Derivative financial instruments | 153 | 345 |
| Other non-current liabilities | 996 | 935 |
| Total non-current liabilities | 56,812 | 64,644 |
| Current liabilities | ||
| Interest bearing loans and borrowings | 32,716 | 10,191 |
| Trade and other payables | 2,534 | 2,876 |
| Income tax payable | 12 | 46 |
| Derivative financial instruments | 76 | - |
| Other current liabilities | 362 | 372 |
| Total current liabilities | 35,700 | 13,485 |
| Total liabilities | 92,512 | 78,129 |
| Total equity and liabilities | 169,018 | 154,938 |
Additional information:
Tarmo Karotam
Baltic Horizon Fund manager
E-mail tarmo.karotam@nh-cap.com
www.baltichorizon.com
Distribution: GlobeNewswire, Nasdaq Tallinn, Nasdaq Stockholm, www.baltichorizon.com
This announcement contains information that the Management Company is obliged to disclose pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the above distributors, at 15:30 EET on 11th May 2017.
