Definitions

Hemsö presents some financial measures in interim and annual reports that are not defined under IFRS. The company believes that these measures provide valuable supplemental information to investors and the company’s management since they enable evaluation of the company’s earnings and financial position. Since financial measures are calculated differently by different companies, they are not always comparable with the measures used by other companies.

Financial definitions

Share of secured debt
Interest-bearing secured debt in relation to the market value of properties.

Loan-to-value ratio
Interest-bearing net debt in relation to the market value of properties and
investments in joint ventures.

Property yield
Net operating income over the past 12 months, adjusted for the holding
period and currency of the properties during the period, in relation to market value of properties at period-end, excluding development properties.

Available liquidity
Cash and cash equivalents and current investments plus undrawn committed credit facilities.

Profit from property management
Profit after net interest income after reversal of changes in value and tax from participations in joint ventures.

Average interest rate
The weighted interest rate on interest-bearing liabilities with consideration for interest-rate derivatives and committed credit facilities on the closing date.

Investments in joint ventures
The share of equity in joint ventures, and loans to joint ventures.

Loan maturity
The weighed average of the remaining term of interest-bearing liabilities, including the maturities of undrawn commited credit facilities.

Short-term borrowings
Loan maturities within 12 months.

MTN programme and EMTN programme
Swedish and European bond programmes, respectively.

Net debt
Interest-bearing liabilities less cash and cash equivalents and currernt iinvestments.

Operating cash flow
Profit from property management after reversal of depreciation and profit from property management in joint ventures, less tax paid with additions for dividens from joint ventures.

Interest-coverage ratio
Operating profit in relation to net interest income/expense. 

Operating profit
Net operating income plus share of profit from participations in joint ventures, and administrative expenses.

Debt-coverage ratio
Available liquidity in relation to short-term borrowings.

Total return
The sum of net operating income and value changes in relation to average market value of properties , adjusted for value changes over a rolling 12-month period.

Currency exposure
Net of market value of properties, joint ventures, cash and foreign currency liabilities less currency hedging as a percentage of equity.

Property-related definitions

Net operating income
Rental income less operating and maintenance costs and property tax, ground rent not included in net operating income.

Economic occupancy rate
Contracted annual rental income in relation to rental value.

Rental income
Rental value less vacancies, rent reductions and rental losses.

Rental duration
The weighted average remaining rental duration excluding garage/parking, storage and housing units let to private individuals.

Rental value
Contracted annual rental income plus vacancy rent.

Comparable portfolio
The properties owned throughout the entire period and entire comparative period and not classified as development properties during these periods.

Contracted annual rent
Contracted annual rental income less reductions and rental losses.

Net investments
Total of purchasing, including stamp duty and other direct transaction costs and investments in development projects, less the selling price of properties sold and the selling price of properties sold via companies and direct transaction costs.

Development property
A property or well-defined part of a property that has been vacated in order to convert and develop the property. A development property also refers to a building under construction, or a property with an investment amounting to at least 20 per cent of its market value. A development property is reclassified to completed property on 1 January of the year after completion.

Public property 
A property that is predominantly utilised for taxpayer-funded operations and is purpose-built for public services. Assisted living are also included in the public properties concept.

Large cities
The definition of major cities in Sweden, Finland and Germany according to Statistics Sweden and the OECD: In Sweden and Finland, municipalities with a population of 100,000 or more, and in Germany, with a population of 200,000 or more.

Lettable area
The areas of the properties for which tenants can be charged rent at period-end.

Rent based on vacancy rate
Rental value of vacancy rent as a percentage of total rental value.

Vacancy rent
Estimated market rent for vacant premises in "as-is" condition.

NOI margin 
Net operating income in relation to the sum of property income and other income.