In accordance with Nasdaq’s recommendations, from Q4 2018, and retroactively, SSM applies the completed contract method for reporting cooperative apartment projects.
Summary of January – March 2019
- Net sales for projects run entirely by SSM totaled 15.4 MSEK (225.5).
- Operating loss was -12.4 MSEK (34.7).
- Cash flow from operating activities amounted to -33.7 MSEK (-88.6).
- 27 (6) pre-purchase agreements were signed. 6 (0) agreements were cancelled due to changes within the Bromma Boardwalk project.
- The Stockholm City Planning Committee decided to continue planning for Tellus Towers. Consultations are planned to the third and fourth quarters 2019.
- The Clustret project in Jakobsberg, which has 200 building rights, was terminated due to a significant change in the municipality’s planning work.
- A cost-efficiency program was introduced to reduce overhead costs by 50.0 percent, or 25.0 MSEK, in 2019.
There were no significant events after the balance sheet date
Mattias Roos, President & CEO, comments on the first quarter:
“The sales of cooperative apartments, especially those within new production, remain cautious even if there has been a certain stabilization in the market. Earlier in the year, we launched over 100 redesigned, smart and affordable homes in the Elverket Nacka and Täby Market projects, most of which are priced under 2.0 MSEK. The aim going forward is for 70.0 percent of our cooperative apartments for sale to be priced under 2.0 MSEK. During the quarter, we sold 27 cooperative apartments and at the end of the quarter, the company’s sales rate in ongoing production was 96.6 percent.
The quarter’s operating loss was -12.4 MSEK (34.7) due to fewer cooperative apartments where revenue was recognized and lower revenue from contracting operations. From the third quarter of 2019, profit recognition will commence for West Side Solna project. To increase profitability in the near future, a cost-efficiency program has been initiated to cut the company’s overhead costs by 50 percent to about 25.0 MSEK in 2019.
SSM’s flexible project portfolio was a strength for the company when the market for new production of cooperative apartments slowed in the second half of 2017. Today, nearly half of our projects are rentals. The rental unit business has strong potential due to the conversions of rental units to cooperative apartments in the last ten years and conversions planned by municipal housing companies. There is significant interest from investors in our rental projects and in the next two years, we expect good growth within this product area.
I believe that with our housing concept and attractive project portfolio, SSM is correctly positioned for good growth and value creation over time. In 2019, SSM aims to start production of approximately 300 homes, and then gradually increase production to 1,500 homes by 2023.”
The information in this press release is such, which SSM Holding AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out below, at 07:00 CEST on May 15, 2019.
For more information, please contact:
President & CEO
Chief Communications & IR Officer
Phone: +46 761-65 17 71
About SSM Holding AB (publ)
SSM produces functionally smart and affordable homes with attractive common areas, close to public transport and the city center for the company’s target group – the urbanites of tomorrow. The company envisions a housing market that is accessible to as many people as possible and aspires to produce 50 percent cooperative apartments and 50 percent rental units. SSM is the leading property developer in its niche within the Greater Stockholm area and at end of March 2019, the company has approximately 6,200 building permits in its portfolio. SSM has been listed on Nasdaq Stockholm (Small-Cap) since April 6, 2017. www.ssmlivinggroup.com