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Trianon

Trianon

Rental apartments and community service properties

Trianon is a real estate company that owns, manages, acquires and develops properties in Malmö, Skåne. The property portfolio encompass rental apartments (62%), retail (22%), office (5%), social infrastructure (10%). Rental apartments and social infrastructure properties account for 72%. Trianon divides it geographic exposure into City (30%), Limhamn/Slottsstaden (21%), Lindägen/Hermodsdal/Oxie (41%) and Rosengård (8%).

Trianon has ~900 apartments in its current project portfolio. The company guides that construction on most of these apartments will be started in 2020 and 2021. We see potential in development profits and an increase in CEPS from its current project portfolio. We argue that Trianon’s book value/sqm is low compared to rental apartment trading peers and residential prices in Malmö, which is why we argue that the company’s properties may be subject to a potential value uplift.

Real estate companies are subject to macro risks, supply of premises risk, supply of capital risk, debt availability risk, forex risk, regulatory risk, rental income risk, property cost risk, property value risk and ownership risk. We argue that specific risks related to Trianon are ownership risk, geographical risk and dependency on certain individuals in the business.

SEKm 2020 2021e 2022e
Rental Income 553 631 684
Rental growth (%) 22,7 14,5 8,4
Net operating income 369 425 465
NOI margin (%) 66,6 67,4 68
CEPS Adj 5,17 6,31 7,19
CEPS Adj. growth (%) 15,5 22 14
DPS 1,8 2,25 2,7
EPRA NAVPS 100,9 115,28 130,69
EPS 13,48 7,57 8,6
EPS Adj 14,27 8,5 9,54
P/CEPS Adj. (x) 26,5 21 18,4
P/E Adj. (x) 9,6 15,6 13,9
P/EPRANAV (x) 1,36 1,15 1,01
Implicit yield (%) 3,6 3,6 3,9
div.yield (%) 1,3 1,7 2
LTV (%) 55,7 56,9 53,5
N/A N/A N/A
SEKm 2020 2021e 2022e
Rental income 553 631 684
Other income 3 6 6
Operating costs -187 -211 -225
Net operating income 369 425 465
NOI margin (%) 66,3 66,8 67,4
Value change realized 0 0 0
Value change unrealized 406 0 0
Administration costs -53 -52 -54
All other income & costs 0 0 0
EBIT 722 373 410
Net financial items -86 -96 -100
Value change derivatives -62 0 0
Pretax profit 567 271 304
Deferred profit tax -33 47 53
Current tax 0 0 0
Net profit 535 318 357
Minority interest 0 0 0
Net profit to shareholders 505 283 322
Cash earnings 194 236 269
Tax rate (%) -5,8 17,4 17,4
Net investments 1098 1584 648
Acquisitions N/A N/A N/A
Other investments 0 0 0
Divestments N/A N/A N/A
EPS 13,48 7,57 8,6
CEPS 5,17 6,31 7,19
CEPS adj. 5,17 6,31 7,19
Dividend per share Adj 1,8 2,25 2,7
Payout ratio of CEPS (%) 34,8 35,7 37,6
Rental growth (%) 22,7 14,5 8,4
NOI growth (%) 29,1 15,3 9,3
CEPS growth (%) 15,5 22 14
CEPS adj. growth (%) 15,5 22 14
Properties 9462 11046 11695
Deferred tax asset 57 0 0
Receivables 213 213 213
Cash and liquid assets 280 280 280
Other assets 291 331 359
Current liabilities 167 0 0
Total assets 10303 11871 12546
Shareholders equity 3635 4145 4719
Minority 0 0 0
Deferred tax 587 737 837
Interest bearing debt 5915 6989 6990
Short-term debt 0 0 0
Derivatives 167 0 0
Total liabilities and equity 10303 11871 12546
Net IB debt 5266 6289 6255
Rental area m2 (000) 402 402 402
Rent per m2 1381 1581 1714
Equity ratio (%) 35,3 34,9 37,6
Loan to value (%) 55,7 56,9 53,5
Net loan to value (%) 65,5 65,8 62,2
ICR real estate 4 4 4
Interest rate on debt (%) 2 2 2
Occupancy rate (%) 94,5 94,5 94,5
NAV per share 0 0 0
BVPS 97,03 110,62 125,96
EPRA NAV per share 100,9 115,28 130,69
Shares outstanding adj. 37 37 37
Share price 114,83 132,5 132,5
Market cap. (m) 4302 4964 4964
P/E 10,2 17,5 15,4
Net IB debt / share 141 168 167
P/CEPS 26,5 21 18,4
P/CEPS adj. 26,5 21 18,4
EV/EBIT 14,4 30,1 27,3
Implicit yield (%) 3,6 3,6 3,9
Yield on BV (%) 3,9 3,8 4
Dividend yield (%) 1,3 1,7 2
P/NAV 0 0 0
P/EPRA NAV 1,36 1,15 1,01
P/BVPS 1,41 1,2 1,05
EV/NOI 28,22 26,47 24,14
N/A N/A N/A

Equity research

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Media

Trianon - Company presentation with CFO/Deputy CEO Mari-Louise Hedbys & IR Manager Nina Gilljam

Main shareholders - Trianon

Main shareholders Share capital % Voting shares % Verified
Olof Andersson 27.4 % 32.8 % 30 Sep 2020
Briban Invest AB 27.4 % 32.8 % 31 Dec 2020
Martin Gren (Grenspecialisten) 10.0 % 7.3 % 31 Dec 2020
Länsförsäkringar Fonder 9.9 % 7.2 % 2 Feb 2021
Mats Cederholm 3.1 % 3.6 % 31 Dec 2020
SEB Fonder 4.1 % 3.0 % 31 Jan 2021
Familjen Eklund 2.5 % 1.8 % 31 Dec 2020
Futur Pension 1.6 % 1.1 % 31 Dec 2020
Idoffs Fastighets AB 1.1 % 0.8 % 31 Dec 2020
Areim Investment 4-5 AB 1.1 % 0.8 % 31 Dec 2020
Source: Holdings by Modular Finance AB

Insider list - Trianon

Name Quantity Code Date
Ann Eriksson + 85 BUY 23 Feb 2021
Ann Eriksson + 55 BUY 27 Aug 2020
Olof Andersson + 4 445 BUY 16 Jul 2020
Olof Andersson + 6 871 BUY 15 Jul 2020
Anna Heide + 8 BUY 9 Jul 2020
Mari-Louise Hedbys - 5 000 SELL 2 Jul 2020
Anna Beatrice Heide - 5 000 SELL 2 Jul 2020
Axel Barchan + 15 000 BUY 1 Jul 2020
Mari-Louise Hedbys - 15 000 SELL 1 Jul 2020
Mats Cederholm - 4 200 SELL 30 Jun 2020

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