Park Street A/S – Annual Report 2023

Park Street A/S – Annual Report 2023

Copenhagen, 4 April 2024

Park Street result analysis primarily uses the term EBVAT (Earnings before value adjustments and tax) to measure the Group’s operating results.

The Group achieved in 2023 an EBVAT (profit excluding value adjustments and tax) of DKK 41.4 million (2022:DKK 42.9 million), as compared to expectations of DKK 45-50 million (published in the Park Street Interim Report Half Year 2023 results announcement in Aug 2023), primarily driven due to a combination of reduction in number of assets from sale of properties, leading to lower income, combined with an increase in financial expenses due to changes in interest rates. Furthermore, there was an increase in new leasing adding to costs for marketing activity, and an increase in energy costs related to vacant units. 

We expect the EBVAT for 2024 to be DKK 30-40 million in view of potential new leases in the pipeline and an expected reduction in costs. This outlook takes note of sale of 3 further properties subsequently in 2024. This could change with any significant further sales or additions to the property portfolio. 

The evolution of the EBVAT is influenced by the following factors:

• Gross profit in 2023 is DKK 121.9 million (2022: DKK 104.7 million), equivalent to a increase of DKK 17.2 million. The increase in gross profit is primarily due to rental income (DKK 9.2 million).
• The Group's overheads were DKK 28.1 million in 2023 against DKK 31.8 million in 2022. The decrease of DKK 3.7 million is caused by savings in employee costs and depreciation.
• Net financial items amount to DKK –52.4 million in 2023 against DKK -29.9 million in 2022, representing a negative change of DKK 22.5 million driven by an increase in the interest costs.

The decrease in the Net Result for the period from DKK 55 million in 2022 to DKK –24.2 million in 2023 is due to the following effects:

• Fair value adjustment in 2023 with a net of DKK –73.8 million against DKK 36.6 million in 2022. In both periods an evaluation of the domicile and investment properties have been made adjusting the yield and the estimated profit and loss for the entire portfolio of Park Street A/S and subsidiaries.

The Group's equity as at 31 December 2023 was DKK 1,060 million, compared to DKK 1,087 million as at 31 December 2022. The decline in equity is due to the loss during the year.