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Introduction & Market Context
Catena AB (STO:CATE), a Swedish logistics property company, presented its Q1 2025 results on April 29, showing strong performance despite a cautious market environment. The company’s stock rose 2.9% following the announcement, closing at 453.60 SEK.
The logistics real estate market continues to face low transaction activity, though e-commerce growth remains robust at 11% year-over-year for March 2025. Catena noted regional oversupply leading to high vacancy rates in some areas, prompting a cautious approach to new developments.
Quarterly Performance Highlights
Catena reported impressive financial results for Q1 2025, with rental income increasing by 31% to 644 million SEK compared to 493 million SEK in the same period last year. This exceeded analyst expectations of 637.84 million SEK.
Profit from property management saw an even stronger increase of 40%, reaching 398 million SEK versus 285 million SEK in Q1 2024. On a per-share basis, profit from property management grew 18% to 6.60 SEK, surpassing the forecasted 6.12 SEK.
As shown in the following chart of quarterly financial performance:
The net operating surplus also showed significant improvement, increasing by 36% year-over-year. EPRA NRV per share (a measure of net asset value) continued its steady upward trend, reaching 429 SEK compared to 399 SEK previously.
The company’s rental growth was driven by multiple factors, as illustrated in this breakdown:
Acquisitions contributed 25.4% to the rental growth, while project development added 5.3% and like-for-like growth was 2.2%. Divestments had a negative impact of 2.3%.
Strategic Initiatives & Development Projects
Catena maintains a strong focus on its development pipeline, with several key projects underway. The company highlighted three major developments: Mappen 4 in Linköping, Logistics Position Ramlösa in Helsingborg, and Sockret 4 in Malmö, with a combined investment of approximately 1.27 billion SEK.
The company’s current development projects are strategically positioned across Sweden and Denmark, as shown in this map:
Looking ahead, Catena’s land bank represents significant growth potential. The company controls 4,500,000 square meters of land with potential for 1,600,000 square meters of gross leasable area, representing potential investments of approximately 16.3 billion SEK.
The strategic locations of this future development land bank are illustrated here:
Customer Base & Portfolio
Catena’s customer base remains dominated by logistics and transport companies, which account for 50% of the contractual value. The company’s top ten customers represent 54% of contractual value, with DSV (19%), DHL (8%), and ICA (6%) being the largest tenants.
The following chart shows the distribution of Catena’s customer base by sector:
The company’s portfolio consists of 135 properties with a fair value of 41.5 billion SEK, up from 32.6 billion SEK in Q1 2024. The economic letting ratio remains strong at 97%, while the surplus ratio has improved to 83% from 80% a year earlier.
Sustainability Focus
Catena continues to advance its sustainability initiatives, with 53% of its lettable area now environmentally certified. The company is targeting net-zero greenhouse gas emissions by 2030 and has achieved strong alignment with EU taxonomy requirements.
The company’s sustainability metrics and EU taxonomy alignment are detailed here:
With 76% of turnover, 57% of investments, and 68% of costs aligned with EU taxonomy, Catena demonstrates a strong commitment to sustainable business practices. The company’s green share of debt stands at 76%, exceeding its target of 50% by 2025.
Financial Position & Outlook
Catena maintains a solid financial position with a loan-to-value ratio of 37.8%, well below its policy limit of 50%. The company’s interest coverage ratio stands at 4.0x, comfortably above the 2.0x policy minimum.
Key financial metrics are illustrated in the following chart:
The company has successfully refinanced 650 million SEK of bank debt on improved terms and completed a 500 million SEK bond issue with a 3-year tenor at Stibor + 0.95%. The average debt maturity is 5.0 years, and the cost of debt is 3.3%.
CEO Jörgen Eriksson expressed confidence in the company’s outlook, stating, "We are very well positioned with favorable conditions for continued growth." This optimism is supported by the company’s strong balance sheet, strategic land bank, and stable customer base.
Market Reaction & Analyst Perspectives
Following the earnings announcement, Catena’s stock price increased by 12.8 SEK or 2.9%, reflecting investor confidence in the company’s growth prospects. According to the earnings call transcript, analysts showed particular interest in the company’s recent acquisition in Denmark and its strategy for tenant acquisition.
With a market capitalization of approximately $2.85 billion, Catena has demonstrated consistent growth, achieving a 17.05% revenue increase over the last twelve months. Analysts forecast continued sales growth for the current year, with revenue expected to grow by 20%.
The company’s strong Q1 performance, combined with its strategic positioning in the logistics real estate sector and solid financial foundation, suggests Catena is well-positioned to navigate market uncertainties while pursuing selective growth opportunities.
Full presentation:
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