Investors House: Strong Q4 supported by associated companies and upbeat 2024 guidance - Nordea

Investors House reported Q4 revenues of EUR 1.8m, in line with our estimate. Net operating income was EUR 0.6m, which was down 15% y/y and 32% below our estimate. The dividend proposal is EUR 0.33 per share, as we expected. Real Estate division posted 6% sales growth (3% below our estimate) with net operating income down 17% y/y. The Services segment posted weaker results than we had anticipated with sales down 22% y/y and operative EBIT down 57% y/y. Services also had in impairment charge of EUR -0.6m in the quarter. Associated companies, which includes e.g. the Kukkula-project in Jyväskylä, contributed more to earnings in Q4 than we expected. Fair value changes were EUR -1.0m in Q4. EBIT excluding fair value change was EUR 1.6m, 61% above our estimate but likely includes significant amount of fair value changes in associated companies, we believe. The Services business accounted for 49% of sales and Real Estate for 51% in Q4. A guidance for 2024 was introduced: earnings will be at the same level as in 2023 (2023: EUR 3.5m). As 2023 included a significant amount of positive fair value changes, we have expected the 2024 result to decline from 2023 as we do not forecast fair value changes. EPRA NRV was EUR 5.76 per share, virtually unchanged q/q, which translates to a 10% EPRA NRV discount. The equity ratio was flat q/q at 63% in Q4 and cash position was EUR 8.5m. We expect an initial positive share price reaction on the upbeat 2024 guidance.