In short

<p class="Preamble" style="font-size: 1.35em;">Aros Bostad is a residential developer focusing on developing functional and sustainable residential housing with timeless design, in attractive geographical areas.</p>
<p class="Preamble" style="font-size: 1.35em;">The Company acquires and develops land into building rights and subsequently into residential housing.</p>
<p class="Preamble" style="font-size: 1.35em;">With a long-term perspective and responsibility for the entire value chain, Aros Bostad creates a safe deal for home buyers as well as stable returns for the investors.</p>


<p>The primary geographical market is the greater Stockholm area and Uppsala. The Company’s project portfolio has historically been built up through fund structures in collaboration with institutional investors, as well as through own acquisitions.</p>
<p>Main investors in Aros Bostad’s funds are primarily institutional capital from AP1, Varma, SEB Trygg-Liv, SEB Pensionsstiftelse, Östersjöstiftelsen as well as several prominent and financially strong entrepreneurs and investors.</p>
<p>The Company’s ordinary shares and class B preference shares are listed on Nasdaq First North Growth Market.</p>


Aros Bostad in short

Financial targets

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<p class="Preamble" style="font-size: 1.35em;">Aros Bostad has clear financial and operational targets for the business.</p>
<p>The Company focuses on risk management as well as continuous monitoring of cash flows of the project portfolio, paving the way for sustainable value creation in combination with balanced growth and financial profitability.</p>
<h5>Project targets</h5>
<p>Each project should, through project development, project-specific marketing and sales efforts as well as through cost-efficient execution, maximise the market value of the project, and ultimately result in solid returns in combination with a balanced project risk.</p>


<h3>Financial targets</h3>
<p>Aros Bostad has clear financial and operational targets for the business. The Company focuses on risk management as well as continuous monitoring of cash flows of the project portfolio, paving the way for sustainable value creation in combination with balanced growth and financial profitability.</p>
<h5>Project targets</h5>
<p>Each project should, through project development, project-specific marketing and sales efforts as well as through cost-efficient execution, maximise the market value of the project, and ultimately result in solid returns in combination with a balanced project risk.</p>
<h5>Units in production</h5>
<p>The number of units in production should amount to 1,200-1,400 each year.</p>
<h5>Equity ratio</h5>
<p>The long-term equity ratio should exceed 30 per cent.</p>
<h5>Project margin</h5>
<p>The project margin, defined as project profits divided by project costs, should amount to, at least, 20 per cent over time. The target is based on the historical average of project margins as well as the current business plan for the project portfolio.</p>


January – December 2022

<p><strong>Aros Bostad’s Year-end report 2022 shows strong operating profit and high sales ratio in projects under production</strong></p>
<p>Aros Bostad reports strong operating profit and a sales ratio of 88 percent in projects under production at year-end, as a result of strategic residential rental apartments divestment and acquisition of a large portfolio.</p>
<p>According to the segment reporting, the total operating income amounted to 954,451 TSEK (543,506). The gross result amounted to 238,444 TSEK (143,811) and the gross margin was 25.0 percent (26.5).</p>
<p>According to the segment reporting, operating profit amounted to till 141,348 TSEK (61,981) and the operating margin was 14.8 percent (11.4). The profit for the period, according to segment reporting amounted to 136,156 TSEK (58,988).</p>


<p>Operating income for the period, according to IFRS, was 41,137 TSEK (104,892) and operating profit was –62,550 TSEK (47,385).</p>
<p>Revenue recognition according to IFRS is created at the time when the main part of the units has been handed over to customers.</p>
<p>Handover and profit recognition, according to percentage of completion method, was done for O2 Orminge, Invernesshöjden and Milstena Skarpäng.</p>
<p>The number of profit recognized apartments, according to IFRS, were 58 (316). 122 (277) apartments have been handed over to buyers during the period.</p>
<p>The number of sold units during the period amounts to 1,015 (466).</p>
<p>&nbsp;</p>


The period January – December 2022

Key ratios 2021

Key ratios 2019-2020

Previous reporting periods

IFRS vs Segment Reporting

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<h3>IFRS vs Segment Reporting</h3>
<p>The difference between applying segment reporting and IFRS is that the income from sales of residential units, in accordance with the previous applied accounting method, is accounted for when the project is sold to the tenant-owner association. The income is then reported according to the percentage-of-completion method.</p>
<p>As a consequence of changing reporting method, it is the homebuyer of the apartment, and not the tenant-owner association, that is identified as Aros Bostad’s customer. After the change of accounting standard, the income is reported when the customer moves in. Before the customer moves in, the residential unit is treated as a current asset under the line-item development properties.</p>
<p>Aros Bostad intends to continue to report in accordance with both accounting methods and finds that segment reporting gives a more complete view of the Company’s business, which is also in line with the Company’s internal reporting.</p>


History

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<h3>History</h3>
<p class="Preamble" style="font-size: 1.35em;">The Company was founded in 2006 and its primary market is the greater Stockholm area, including Stockholm county and Uppsala.</p>
<p>The Company’s focus has transferred from historically having converted commercial buildings to housing, to focusing on developing and producing new residential units and housing. The Company’s project portfolio has historically been built up through fund structures in collaboration with institutional investors, as well as through own acquisitions.</p>


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<p>Since November 2018, Aros Bostad has had preference shares listed on Nasdaq First North Growth Market. In September 2019, First Swedish National Pension Fund (AP1) acquired a large stake in the Company through a directed issue of ordinary shares for an amount of c. SEK 150 million.</p>
<p>The directed issue of ordinary shares to AP1 was part of Aros Bostad’s continued ambition to create favourable conditions for further expansion of the Company’s project portfolio through value-adding building rights acquisitions, in addition to strengthening the shareholder base with a well-renowned institutional investor. Moving forward, the Company’s intention is to develop a larger share of the projects on the balance sheet to enable further financial growth going forward.</p>
<p>In June 2021 Aros Bostad listed the ordinary shares on Nasdaq First North Growth Market.</p>


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Press releases

<p>All Aros Bostad’s press releases will be published in English, alongside Swedish, as of 25 May 2021. Please feel welcome to contact any of our key contacts below in order to get more detailed company- or projectrelated information in English.</p>
