Baltic Horizon Fund consolidated unaudited results for Q4 2025
Management Board of Baltic Horizon Capital AS has approved the unaudited financial results of Baltic Horizon Fund (the Fund) for the twelve months of 2025.
The Fund reports Q4 2025 and full year 2025 unaudited results in the spirit of fresh start under new ownership of the Management Company, strengthened organization, and at the same time communicates a decision to proceed with the secondary public offering of new units.
The Fund generated a total of EUR 15,098 thousand of rental income during 2025. Due to significant vacancies across the portfolio (13.8% at the end of 2025), the limitations of rental contracts, and the write-offs of old debts, the total volume of property costs not recovered from the tenants amounted to EUR 3,435 thousand during the year, thus resulting in the Net Operating Income (NOI) of EUR 11,663 thousand. Excluding the effect of properties disposed during 2024 and 2025, the like-for-like NOI comparison would amount to EUR 11,473 thousand for 2025 vs. EUR 11,339 thousand for 2024. NOI during Q4 2025 alone amounted to EUR 2,954 thousand, which also covers significant provisions (EUR 540 thousand) made for those historic tenants’ debts.
The portfolio continued undergoing major transformation of its leases also during Q4 2025, with particular attention on the leasing up of our largest assets – Galerija Centrs and Europa SC as well as the office properties in Tallinn and Riga.
The overheads of the Fund amounted to the total of EUR 1,923 thousand for 2025 (EUR 2,373 thousand for 2024). The Management is terminating all non-essential costs both for the Fund and in each subsidiary. Several of the subsidiaries are merged by the end of the year (further mergers underway in 2026) in order to minimize the administration cost involved, discontinued listing of SDRs – all these steps will start bearing noticeable savings from 2026 onwards.
The total cost of financing in the amount of EUR 9,193 thousand (incl. various fees), continued weighing heavily on the financial performance. The Fund remains overleveraged and this creates a dual challenge in the form of both high overall debt volume to be continuously serviced, as well as the perceived risk profile, and therefore – the pricing – of debt from the financiers of the Fund.
In the light of the portfolio characteristics, persistent adverse commercial market conditions, and with latest assumptions on the capex needed to upgrade the properties of the Fund, the revaluation of the property portfolio performed by independent valuators resulted in the total actual portfolio value at year end of EUR 208.9 million (the write-down effect of EUR 20,602 thousand recorded in Q4 2025). Total capital expenditure incurred during the year and expensed through fair value adjustment against year-end values amounted to EUR 4,764 thousand (including accrued brokerage cost on long-term leases, fit-out provisions for incoming tenants, etc.).
With this updated valuation of the property portfolio and the actual volume of financial debt in the amount of EUR 133,285 thousand (as well as other balance sheet items), the Fund equity ratio (equity-to-assets) stands at 36.1%, which is below the minimum level of 37.5% set out in the Terms & Conditions of the Bonds (ISIN: EE3300003235). The bondholders are being notified today of the occurrence of this non-compliance event which must be cured within a period of 20 days.
Furthermore, the three loans maturing in Latvia at the end of Q1 2026 require strengthening of the Funds equity by at least EUR 7.0 million as a condition for prolongations as well as source for partial prepayments.
In this light, the Management has taken a decision to proceed with the Secondary Public Offering of the units of the Fund in the total amount of up to EUR 25.0 million, as mandated by the Unitholders’ Meeting on 16 December 2025. Management believes that the minimum amount required to address imminent liquidity needs of the Fund, restore sufficient equity ratio level, and with that – ensure going concern of the Fund – will be met. On this basis the final audited accounts for 2025 will be prepared and published during the last week of March 2026.
The Baltic commercial property markets continue to face elevated uncertainty. Nevertheless, Management believes that the Fund reached an operational inflection point toward the end of 2025, from which a gradual improvement is expected during 2026. This expected improvement is based on concrete measures already underway, including the ongoing transformation of lease structures, active leasing of key vacant assets, the insourcing of property management functions, and the reduction of overhead and financing costs.
These expectations do not constitute specific financial, valuation, or distribution guidance and are contingent upon the timely execution of the planned turnaround actions, successful completion of the secondary public offering and related refinancing processes, as well as the absence of further adverse developments in the Fund’s operating markets or within its property portfolio.
Overview of the Fund’s investment properties as of 31 December 2025
| Property name | Sector | Fair value1 | NLA | Net initial yield | Occupancy rate |
| (EUR ‘000) | (sq. m) | 20252 | |||
| Vilnius, Lithuania | |||||
| Europa SC | Retail | 31,836 | 17,430 | 2.7% | 82.5% |
| North Star | Office | 18,778 | 10,706 | 6.5% | 93.2% |
| Total Vilnius | 50,614 | 28,136 | 4.2% | 86.6% | |
| Riga, Latvia | |||||
| Upmalas Biroji BC | Office | 14,610 | 11,095 | 4.7% | 56.6% |
| Vainodes I | Office | 12,400 | 8,128 | 8.1% | 100.0% |
| S27 Centre | Office | 12,270 | 7,348 | (1.3%) | 58.7% |
| Sky SC | Retail | 4,700 | 3,260 | 9.0% | 100.0% |
| Galerija Centrs | Retail | 58,356 | 19,956 | 4.6% | 87.8% |
| Total Riga | 102,336 | 49,787 | 4.7% | 79.3% | |
| Tallinn, Estonia | |||||
| Postimaja | Retail | 21,270 | 9,232 | 6.0% | 99.8% |
| Apollo Plaza complex | Leisure | 13,260 | 7,877 | 6.8% | 100.0% |
| Lincona | Office | 11,410 | 10,767 | 7.9% | 90.7% |
| Pirita SC | Retail | 10,050 | 5,425 | 8.5% | 95.1% |
| Total Tallinn | 55,990 | 33,301 | 7.1% | 96.1% | |
| Total portfolio | 208,940 | 111,224 | 5.2% | 86.2% |
- Based on the latest valuation as of 31 December 2025, recognised right-of-use assets and subsequent capital expenditure.
- The net initial yield (NIY) is calculated by dividing annualized NOI by the market value of the property.
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
| EUR ‘000 | |||||||
| 01.10.2025 – 31.12.2025 | 01.10.2024 – 31.12.2024 | 01.01.2025 – 31.12.2025 | 01.01.2024 – 31.12.2024 | ||||
| Rental income | 3,737 | 3,779 | 15,098 | 15,136 | |||
| Service charge income | 1,165 | 1,145 | 4,947 | 4,744 | |||
| Cost of rental activities | (1,948) | (2,205) | (8,382) | (8,292) | |||
| Net rental income | 2,954 | 2,719 | 11,663 | 11,588 | |||
| Administrative expenses | (404) | (644) | (1,923) | (2,373) | |||
| Other operating income | 87 | 3 | 126 | 18 | |||
| Losses on disposal of investment properties | (125) | (245) | (1,475) | (863) | |||
| Valuation losses on investment properties | (20,589) | (3,052) | (20,602) | (15,581) | |||
| Operating profit (loss) | (18,077) | (1,219) | (12,211) | (7,211) | |||
| Financial income | 4 | 169 | 69 | 196 | |||
| Financial expenses | (2,067) | (2,789) | (9,193) | (10,540) | |||
| Net financial expenses | (2,063) | (2,620) | (9,124) | (10,344) | |||
| Profit (loss) before tax | (20,140) | (3,839) | (21,335) | (17,555) | |||
| Income tax charge | 1,020 | 457 | 1,256 | 774 | |||
| Profit (loss) for the period | (19,120) | (3,382) | (20,079) | (16,781) | |||
| Other comprehensive income that is or may be reclassified to profit or loss in subsequent periods | |||||||
| Net gain (loss) on cash flow hedges | 151 | (446) | 252 | (1,003) | |||
| Income tax relating to net gain (loss) on cash flow hedges | (10) | 1 | (18) | 52 | |||
| Other comprehensive income (expense), net of tax, that is or may be reclassified to profit or loss in subsequent periods | 141 | (445) | 234 | (951) | |||
| Total comprehensive income (expense) for the period, net of tax | (18,979) | (3,827) | (19,845) | (17,732) | |||
| Basic earnings per unit (EUR) | (0.13) | (0.02) | (0.14) | (0.13) | |||
| Diluted earnings per unit (EUR) | – | – | – | (0.12) | |||
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
| EUR ‘000 | 31.12.2025 | 31.12.2024 |
| Non-current assets | ||
| Investment properties | 208,940 | 241,158 |
| Intangible assets | – | 4 |
| Property, plant and equipment | 7 | 5 |
| Derivative financial instruments | – | 1 |
| Other non-current assets | 242 | 1,225 |
| Total non-current assets | 209,189 | 242,393 |
| Current assets | ||
| Trade and other receivables | 1,760 | 2,800 |
| Prepayments | 294 | 802 |
| Cash and cash equivalents | 5,377 | 10,053 |
| Total current assets | 7,431 | 13,655 |
| Total assets | 216,620 | 256,048 |
| Equity | ||
| Paid in capital | 151,495 | 151,495 |
| Cash flow hedge reserve | (186) | (420) |
| Retained earnings | (73,059) | (52,980) |
| Total equity | 78,250 | 98,095 |
| Non-current liabilities | ||
| Interest-bearing loans and borrowings | 113,252 | 98,491 |
| Deferred tax liabilities | 644 | 1,898 |
| Derivative financial instruments | 186 | – |
| Other non-current liabilities | 1,110 | 1,446 |
| Total non-current liabilities | 115,192 | 101,835 |
| Current liabilities | ||
| Interest-bearing loans and borrowings | 20,033 | 50,736 |
| Trade and other payables | 2,729 | 4,473 |
| Income tax payable | 14 | 14 |
| Derivative financial instruments | – | 317 |
| Other current liabilities | 402 | 578 |
| Total current liabilities | 23,178 | 56,118 |
| Total liabilities | 138,370 | 157,953 |
| Total equity and liabilities | 216,620 | 256,048 |
For additional information, please contact:
Tarmo Karotam
Baltic Horizon Fund manager
E-mail tarmo.karotam@baltichorizon.com
www.baltichorizon.com
Baltic Horizon Fund is a registered contractual public closed-end real estate fund managed by Alternative Investment Fund Manager license holder Baltic Horizon Capital AS.
Distribution: GlobeNewswire, Nasdaq Tallinn, www.baltichorizon.com
To receive Nasdaq announcements and news from Baltic Horizon Fund about its projects, plans and more, register on www.baltichorizon.com. You can also follow Baltic Horizon Fund on LinkedIn and YouTube.
This announcement contains information that the Management Company is obliged to disclose pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the above distributors, at 18:40 EET on 17 February 2026.
Attachment
