Hello everyone and welcome to Inderes TV! Today we are going to talk about Logistea, which has recently released its earnings report for the third quarter of 2026, and with me to talk more about the quarterly report and much more is Logistea's CEO Nicklas Zuckerman. Welcome! Nicklas. Thank you so much! It is great to have you here. This is your first time on TV. So I thought, before we get into the report, that you could perhaps explain a bit more about what Logistea is for those who are not familiar with you beforehand?

Absolutely. Logistea is a real estate company listed on the Mid Cap main list. We have a full focus on warehousing and logistics. Light industrial properties, and then we have managed to build a portfolio of just over 20 billion, with the main focus on the Nordic market. So we have managed to both develop and acquire properties that are primarily leased on long-term rental agreements. We have a lot of triple net, as it is called, meaning that the tenant covers operating and maintenance costs, and we place a strong focus on the tenant's ability to pay. That means we would most of all like to develop and acquire properties with extremely strong rent payers.

Yes, exactly. You mentioned the segments you focus on: warehousing, logistics, and light industry. Why those specific segments rather than, for example, offices and residential?

Well, today it is easy to be wise after the event and say that this is the absolute best segment. Which it admittedly is. When we started the company five or six years ago, we saw a need for this. A listed company with this focus. Why is that? Well, generally speaking, as I touched upon, good rent payers. We have a high dividend yield, currently 6.7%, and that should be put in relation to the cost of borrowed capital, which for us is 4.2. We have a high yield spread, meaning a high difference between what the properties yield and what it costs to borrow money in the bank and bond system, meaning good, stable cash flows. We have an average of nearly nine-year lease agreements, so there is good predictability. As I said, good rent payers, and the stock market is rewarding that right now.

So you will have to correct me if I am wrong. But I also imagine that the light industrial companies that rent space there have invested in their own production lines and automation and so on. That also creates a lock-in effect and makes it harder to leave.

Yes, absolutely right. In our typical property, the tenant has often invested more in machinery or automation than the actual building costs or is worth. So that is entirely correct. They are often heavily invested, and for us as property owners, it is important to ensure that the tenant is satisfied. We should be there to grow with them, meaning we should modify the building, make extensions, so that they can do so simply. Or that we have a building that keeps pace with their business and how they develop. Additional investments are something we are happy to make. This means we can often extend the lease agreement in advance, and we can get a good return on that investment, often higher than what we get when we acquire the property.

You touched upon that briefly earlier. Your lease agreements have an average of almost nine years remaining, and most of them are so-called triple net agreements, as you mentioned, with CPI indexing. That can sound very complicated to someone who is not as immersed in real estate as you are, but it is crucial for how predictable the cash flows are. Can you tell us a bit more about what this means?

If we start with the indexing? That means that as inflation is high, we get high indexing, and if it is lower, we naturally get lower indexing, meaning our rental income follows the CPI. After Covid, this meant that we received very high indexations. We were up by a bit over 20% over a three-year period. Then it has been lower for a few years, and now it looks like the CPI for the current year turned out a bit higher, perhaps up towards two percentage points. This means we have a high interest rate environment. Naturally we pay higher interest rates, interest expenses, but we also receive higher income, and income makes up a larger part of the income statement than costs or net financial items do.

If you look at triple net. That means the tenant is responsible for operating and maintenance costs. For one, that is management-efficient, and secondly, utility costs, heating, electricity, and so forth are handled by the tenants. Meaning that high electricity costs mean it is the tenant's expense. Then, of course, for us as property owners. The most important thing is that the tenant is thriving and doing well. That means we do not want too much volatility in either indexing or electricity or utility costs, but predictability and thriving tenants mean they want to continue growing, and then we can invest with them and hopefully get a good return on that investment.

Exciting! Moving on to the third quarter now, for which you released the report this morning. A stable, a stable quarter, even a record quarter, and the market received this somewhat coolly. High expectations possibly, but how would you summarize the quarter?

If you look at the quarter and the whole of 2026, we have been, first of all... We have been very active in the transaction market, acquiring properties for 3.6 billion at an average yield of 7.3% and, as I mentioned, a high yield. Lower financing costs mean that the transactions alone that we have carried out affect or contribute to our earnings per share. Profit from property management per share in the earning capacity by 31 øre, which is a large amount both in terms of crowns and øre and in percentage increase.

Then we have been very successful in the leasing market. We have strong net leasing for us, not that large in the quarter, but if you look at the first nine months, a large amount, 23 million SEK. Then you have to remember that 15 million SEK of those are lease agreements where the tenant has not even moved into their premises yet. So that will affect the occupancy rate and earning capacity here in Q4 and Q1.

Then we have always been active in reviewing our loan portfolio. We have managed to lower the average interest rate here in the quarter, and that is driven by the fact that we started high. Meaning we started with a high margin. A few years ago, and then successively as we renegotiated loan agreements, we have managed to lower the margin and been active in looking at the interest rate market. What opportunities arise to fix interest rates, so an active quarter, active first nine months. And looking at what that entails. Now we have an earning capacity of 1.55 SEK per share, which is a very large increase compared to the beginning of the year and a year ago.

It was also an active quarter on the acquisition side, as we discussed. You have made several acquisitions in Sweden, Denmark, and Finland. At the same time, you have also sold a property in Norway. Can you tell us a bit more about these deals and what they bring to Logistea?

Absolutely, if you look at the sale we have made, a slightly smaller property that we sold in Norway to a tenant. A well-priced deal for us. As I said, it was not a huge property, and that allows us to trim operations slightly.

If you look at the acquisitions, we are extremely pleased. Our first acquisition in Stockholm: we bought a so-called cross-dock, meaning a terminal building outside Stockholm in Spånga, right where the new Forbifarten highway comes up and down. We have done business with DSV previously. We felt that we had the opportunity to make this deal provided we were quick, which we managed to deliver on. So we have bought a seven-year lease agreement with an option in case they should move, at a yield level corresponding to 7% in the Stockholm area. And that is very good, if I may say so. So extremely pleased with that transaction.

Then we have made our largest transaction of the year in Denmark. We bought a portfolio of properties leased to Velux, a window manufacturer. A huge Danish company, surely familiar to those who renovate at home. If you look at the type of windows that come, especially roof windows, it is often Velux, so stable. A good tenant, eleven-year lease agreements, and there we are almost up to an 8% initial yield. Both of these transactions contribute to an increase in earnings from property management, of course, and we are adding two that we previously... But with these tenants, both of them enter the top ten. And about as good a rent payer as you can possibly imagine.

I find it exciting because you write in the report that the property value now exceeds 20 billion SEK, of which 2 billion are in Denmark and 1 billion in Finland, and that this creates both operational and financial synergies. Can you explain a bit? What does this mean in practice with operational and financial synergies?

For one, it means, if you look at Finland, that we have now built, as you say, a portfolio of around 1 billion Swedish crowns. We have then hired a Finnish Head of Property. We felt that was completely necessary. The Finnish market is in many ways similar to the rest of the Nordics, but in several ways it is not. We see a clear advantage in having a Finnish speaker on site quite simply. Simply because we want to. Even though we have long-term lease agreements, we want to ensure that we stay close to the tenants, that we can grow with them. And we see a much better opportunity to do that with a Finnish speaker. Quite simply.

And in much the same way. In Denmark, we have built up 2 billion. It will continue to be managed from our Norwegian office, but we are building a better presence, and in addition, this means we will be able to scout out hopefully even more and better deals, both in terms of leasing, transactions, or new production. Furthermore, as we grow in certain markets, hopefully better financing opportunities arise. Even though in these specific deals it is, so to speak, prior relationships for us in the form of Nordic banks. But clearly, with a slightly larger portfolio, new opportunities arise to look at potentially other financing options.

And speaking of financing options. So the loan-to-value ratio amounted to 52% at the end of the quarter. You have an upper limit of 60%. How do you view today's level? What level is reasonable in the medium term to balance risk and return?

We have said that 55 is something we can live with. We are not going towards that 60%, but around 55%. We are not quite there yet, even though we will go up somewhat in terms of loan-to-value after the latest transaction in Denmark. But to answer the question: 55 or just below.

How are you thinking about capital allocation going forward? How do you prioritize between buying new properties, investing in the existing portfolio, amortizing, distributing money, buybacks, and so on? Can you tell us a little bit about that?

A very interesting question and a current question of course, which is constantly discussed both within the company and with the board and with analysts and investors. In this earnings report, we put together a good calculation example of what and why it was better for us to do the DSV and Velux transaction, for the reason that it creates better earnings per share compared to the average share price during the third quarter. That is the day-one effect. Then you must remember that if you buy a property or properties, they will yield something, and with that capital you can continue to invest so you can, for example, buy more properties or you can choose to invest in your own portfolio. For us, it has so far been better, more advantageous for us and our shareholders to buy properties or invest in the portfolio instead of doing buybacks. That can of course change from time to time.

Then you have to remember that if you go back a few years, we have had a clear growth focus. It has been important that we grew larger. 6 billion in properties. Being listed on the main list, we felt was way too small. Now we have reached a critical mass. So with that said, we will evaluate each transaction and see what is best. In this case. Is it better to buy properties or is it better to do buybacks? That will certainly or potentially change from time to time.

The dividend is something we have had for the past two years. No huge amounts, but still fairly large amounts, and that is clear proof of, or a sign of, that we are to be a dividend-paying company for the reason that we have stable cash flows. We have, for a real estate company, a large free cash flow every quarter that we can choose to reinvest or distribute. So this type of real estate company, of properties, we think is well suited to be able to pay a dividend.

Finally, besides keeping an eye on capital allocation, what do you think an investor should look out for when it comes to Logistea going forward?

On the one hand, you should look at the history and see what we have accomplished from time to time. Then you will hopefully notice that for every quarter that passes, we deliver better and better figures. That is to say, the earnings per share are constantly increasing from time to time. That is driven a lot by the fact that we have been successful in the leasing market, but not least that we have made such good real estate transactions, and feeling a comfort that what we said three years ago and two years ago and one year ago, matches pretty well with what we deliver, if not better. We stick to our business model and I would say that it has proven itself, that it works pretty well actually. That is something to keep an eye on.

Then you should hopefully expect more of the same, more good deals. Gladly some development, construction, and that can be both new construction and it can be that we build for tenants of course. Keep an eye on potential development in Lockryd, a large ballpark that we have worked with for a long time. Yes, that is probably.

More of everything, simply put.

Simply. More of everything.

More of everything. That sounds great! Thank you very much, Niklas, for coming here today!

Thank you!

And thank you to those of you who joined and watched.