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Investing.com -- NP3 Fastigheter AB (ST:NP3) stock gained 2.5% on Friday after the Swedish property company reported positive asset value growth in the first half of 2025, despite showing signs of weakening fundamentals in its rental business.
The company’s net asset value (NAV) increased by 3% year-to-date and 15.5% YoY to SEK159.26 per share, benefiting from positive fair value changes of 0.9% in H1-25.
This growth has now more than offset the previous peak-to-trough asset value decline of 1.9%, with valuation yields remaining stable at 7.1% in Q2-25.
However, NP3’s like-for-like rental growth decelerated sharply to just 2% compared to 8% in fiscal year 2024. When adjusted for one-time early termination fees, like-for-like growth was effectively flat, suggesting a negative reversion rate of approximately -5%.
The company also saw its vacancy rate deteriorate by an estimated 40 basis points YoY to 7.8%.
The property firm’s profit from property management (PFPM) surged 37% YoY to SEK515 million in H1-25, representing a 31% increase on a per common share basis to SEK7.68.
This growth was driven by a 14% increase in rental income to SEK1,115 million, a 2.3 percentage point improvement in EBITDA margin, and a 6% decrease in financial costs.
NP3 continued its preference share issuance strategy, completing a directed issue of 13.7 million new preference shares in May 2025, raising SEK394 million.
This approach, while helping to fund operations, increases the voting power of preference shares from an estimated 6.4% to 8.3% of total votes, potentially diluting minority shareholders.
The company’s leverage remains high, with an economic loan-to-value (LTV) ratio of 58% when factoring in preference shares as debt, though its published LTV stands at 51%, down 80 basis points since the start of the year.
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