Norwegian Property (Buy, TP: NOK17.00) - Stable despite restrictions
Despite offices standing empty on work-from-home orders and the restaurants at Aker Brygge closed, Q1 was solid. However, EBIT was 6% below our forecast as the rent at Snarøyveien 36 was lower than we expected. However, the group’s reported rental contract was in line with our forecast at NOK976m/year. Net lettings were NOK17m/year. The end of one of the company’s most expensive swaps has cut our funding costs and raised our EPS by 31.4% for 2021e and 20.6% for 2022e. We reiterate our BUY and NOK17 target price.Norwegian Property operates in management, acquisitions, sales and development of commercial real estate, including participation in other companies as well as businesses which are related as such. Co.'s properties primarily comprise office premises with associated warehousing and car parks, and retail and catering space. Co.'s activities are organized in four business areas: marketing and letting; property management; property development; as well as transactions and financing. As of Dec 31 2013, Co. owned 41 office and commercial properties in Norway, located in Oslo, Baerum, at Gardermoen and in Slavenger.
DNB Markets is the investment banking arm of DNB Bank ASA and is focused primarily on the Nordic region, as well as internationally on niches such as global shipping, energy and related services, and seafood. DNB Markets offers services in FICC, Equities and Investment Banking advisory from offices in Oslo, Stockholm, London, Singapore and New York. Equity research coverage is offered on c250 Nordic companies. DNB was ranked no.2 in Extel Nordic Research 2017. The DNB Markets’ Credit and FICC Macro & FX Research teams are repeatedly highly rated by Prospera Nordic Institutional Investor Surveys.
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