Investors House: Strong reported Q1 results on asset revaluations - Nordea

Investors House reported Q1 revenues of EUR 1.6m, 4% below our 1.7m estimate. Net operating income was EUR 0.2m, which was up from EUR 0.1m y/y and above our EUR 0.1m estimate. Real Estate division posted 4% sales growth, in line with our estimate, with net operating income up 126% y/y in the seasonally small quarter. The Services segment posted slightly weaker results than we had anticipated with sales down 6% y/y while operative EBIT was up y/y. Associated companies, which includes e.g. the Kukkula-project in Jyväskylä (Apitare), contributed less to earnings in Q1 than we expected. EBIT excluding fair value change was EUR 0.0m, we had expected EUR 0.3m which is to a large extent explained by higher administration costs y/y. Reported Q1 earnings were EUR 0.8m versus EUR -0.2m a year ago and the biggest impact comes from the revaluation of Investors House increasing its ownership in JV Apitare from 1/3 to 2/3. This is included in other income, which amounted to EUR 1.0m in Q1. The former JV Apitare will be consolidated from Q2 onwards. The guidance for 2024 was reiterated: earnings will be at the same level as in 2023 (2023: EUR 3.5m). Equity per share was EUR 5.40 versus EUR 5.27 in Q4 2023. The equity ratio declined q/q from 63% in Q4 2023 to 44% following the Apitare consolidation at the end of Q1 We expect an initial neutral to slightly positive share price reaction.