Our 'A-' issuer and issue ratings on Vacse AB (publ) (Vacse) are unchanged following the publication of its first-quarter results.
Revenues show strong year-on-year growth
Vacse's first-quarter report was in line with our expectations. Revenues in the quarter were SEK 108m (compared with SEK 94m in the first quarter of 2020) and EBITDA was SEK 83m (SEK 69m), corresponding to an EBITDA margin of 76.4% (74.0%) for the period. The net operating income margin was 82.1% (81.0%) for the quarter and 83.8% (82.5%) for the last 12 months.
The average remaining lease term in Vacse's portfolio was 10.5 years, while the occupancy rate was 100%, unchanged from a quarter earlier.
During the quarter, Vacse acquired a preschool property in Stockholm with a remaining 9.6-year lease maturity from Stockholm municipality.
Solid metrics reflect continued strong performance
The NCR-adjusted loan-to-value (LTV) ratio was 38.1%, a decrease from 41.1% a year earlier. The NCR-adjusted EBITDA to net interest ratio was 5.7x, an increase from 5.4x a year earlier. Cash holdings amounted to SEK 774m at the end of the quarter. The average interest rate was 1.9%, while the average debt maturity was 3.6 years and the average interest fixing was 4.2 years.
Financing now 100% green
Following refinancing of secured bank debt in 2020, Vacse's external financing is now 100% green. The company issued a SEK 600m 7-year green bond in March and a SEK 200m 13-year green bond in April. The proceeds were used to settle a new-build property in Jönköping on 1 Apr. 2021 and repurchase part of a SEK 700m bond maturing in 2022. Vacse's liquidity position remains stable, supported by a SEK 700m unutilised revolving credit facility.
Figure 1. Vacse key credit metrics, 2017–Q1 2021
| SEKm | 2017 | 2018 | 2019 | 2020 | LTM to 31 Mar. 2021 |
|---|---|---|---|---|---|
| Total revenue | 334 | 340 | 369 | 384 | 399 |
| NCR-adj. EBITDA | 264 | 263 | 282 | 296 | 310 |
| NCR-adj. investment properties | 5,257 | 5,943 | 6,525 | 7,167 | 7,401 |
| NCR-adj. net debt | 2,046 | 2,416 | 2,687 | 2,791 | 2,820 |
| Total assets | 5,389 | 6,166 | 6,702 | 7,431 | 8,253 |
| NCR-adj. debt/EBITDA | 7.7x | 9.2x | 9.5x | 9.4x | 9.1x |
| NCR-adj. EBITDA/interest | 3.9x | 4.1x | 5.1x | 5.6x | 5.7x |
| NCR-adj. LTV | 38.9% | 40.7% | 41.2% | 38.9% | 38.1% |
Source: company. FY–full year. LTM–last 12 months. LTV–loan to value.
This commentary does not constitute a rating action.
If you have any questions, please contact:
Mille O. Fjeldstad, credit rating analyst, +4799038916, mille.fjeldstad@nordiccreditrating.com
Marcus Gustavsson, credit rating analyst, +46700442775, marcus.gustavsson@nordiccreditrating.com
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