UPP Olaines OÜ consolidated unaudited financial results for Q1 of 2021
MANAGEMENT REPORT FOR 3 MONTHS 2021
General information
UPP Olaines OÜ (hereafter ‘the Company’) was established for the purpose of funding, acquiring and managing the real estate investment of Olaines Logistics Park: (buildings and land) located at “Šarlotes”, Olaines county, Olaines parish, Latvia, cadastre number 8080 003 0029, registered in the Land Register compartment No.5439 of the city of Olaine parish. The Company was established on 24.08.2017 and had no economic activity until 15.12.2017, when it acquired the cold storage warehouse Olaines Logistics Park.
The management board is aware of no trends, uncertainties, demands, commitments or events that are reasonably likely to have a material effect on the Company’s prospects for the period after the reporting period of these financial statements outside the course of its regular business activities.
UPP Olaines OÜ is operating based on going concern.
Financial commentary for the first quarter of 2021
Net rental income was 600 198 euros for the 3 months of 2021 (2020 3 months: 657 214). Operating profit was 562 109 euros for the 3 months of 2021 (2020 3 months: 619 887). Net income was 303 501 euros for the 3 months of 2021 (2020 3 months: 358 561).
The company’s sole business activity is to collect rental revenue, manage the Olaine property and service its liabilities to lenders and investors. Liabilities include the subordinated bonds with a fixed interest rate and the investment loan which’ rate is also fixed with an interest rate swap agreement. On the revenue side the company earns stable triple-net rental income from reputable tenants, which is fixed with medium-term agreements but is subject to indexation. Due to the economically fixed nature of the company, there needs to be major event in the overall economy or in the company’s business activities for them to have significant effect on the company’s financial results.
Changes in lease agreements
On 15th January 2021 the lease agreement expired with Plesko Real Estate SIA, who leased 1,573 sqm of warehousing and administrative premises.
On 15th March 2021 the lease agreement expired with Premier Restaurants Latvia SIA, who leased 2,382 sqm of warehousing and administrative premises.
On 18th January 2021 a new lease agreement was concluded with NNL LV SIA for 5 years. NNL LV SIA will lease 2,663 sqm of warehousing and administrative premises. The company is offering 3PL services to known Baltic clients such as Premia and Maxima.
On 16th April 2021 the lease agreement with Girtekos Logistikos SIA was amended, SIA Girtekos Logistikos will lease additional 1,177 sqm of warehousing and administrative premises.
The changes in lease agreements will not impact the Group’s 2021 income noticeably, except for the 1st quarter of 2021 when the handing over of the premses took place.
Changes in United Partners Group logistics investments structure
In March 2021 United Partners Group OÜ restructured its logistics investment holding structure. Previously the direct parent of the Company was United Partners Property OÜ, which also managed United Partners Group residential development investments. As of March 2021 United Partners Group OÜ logistics investment holding companies, including the Company, are now under the direct ownership of holding company UPP Logistics Properties OÜ, which in turn is under the ownership of United Partners Property OÜ. The goal of the restructuring was to create separate administration units for United Partners Goup logistics and residential investments.
Key indicators of financial performance and position for 3 months 2021
| (in EUR) | Q1 2021 | Q1 2020 | ||
| Net rental income | 600 198 | 657 214 | ||
| Operating profit | 562 109 | 619 887 | ||
| Profit for the period | 303 501 | 329 107 |
| (in EUR) | 31.03.2021 | 31.03.2020 |
| Investment property | 31 320 000 | 30 909 000 |
| Interest-bearing loans | 27 156 360 | 28 226 632 |
| Interest-bearing loans less shareholder loan | 24 214 332 | 25 278 332 |
| (in EUR) | Q1 2021 | Q1 2020 |
| Net profit margin (Total comprehensive income for the period / Net rental income) | 50,6% | 49% |
| ROA (Net profit for the period / Average total assets for the period) | 0,94% | 1,04% |
| DSCR (Operating profit / Loan principal and interest payments on interest-bearing loans) | 1,1 | 1,2 |
Management board and supervisory board
The management board of UPP Olaines OÜ has one member: Marko Tali, the chairman of the management board.
The supervisory board of UPP Olaines OÜ has three members: Mart Tooming, Tarmo Rooteman, Hallar Loogma.
No remuneration or other benefits have been allotted to the members of the management board and supervisory board.
There are no employees in the company besides the members of the management and supervisory board.
CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
Condensed consolidated interim statement of comprehensive income
| (in EUR) | Note | Q1 2021 | Q1 2020 | ||
| Net rental income | 5 | 600 198 | 657 214 | ||
| Net rental income | 600 198 | 657 214 | |||
| General and administrative expenses | (38 089) | (37 327) | |||
| Operating profit | 562 109 | 619 887 | |||
| Financial income / (cost) | (258 608) | (290 780) | |||
| Profit before income tax | 303 501 | 329 107 | |||
| Income tax | 0 | 0 | |||
| Profit for the period | 303 501 | 329 107 | |||
| Total comprehensive income for the period | 303 501 | 329 107 |
Condensed consolidated interim statement of financial position
| (in EUR | Note | 31.03.2021 | 31.03.2020 |
| Cash and cash equivalents | 671 494 | 534 344 | |
| Trade and other receivables | 197 408 | 313 568 | |
| Total current assets | 868 902 | 847 912 | |
| Investment property | 31 320 000 | 30 909 000 | |
| Total non-current assets | 31 320 000 | 30 909 000 | |
| TOTAL ASSETS | 32 188 902 | 31 756 912 | |
| Trade and other payables | 438 615 | 379 344 | |
| Financial derivatives | 331 384 | 448 432 | |
| Loans and borrowings | 6 | 1 064 004 | 1 064 004 |
| Total current liabilities | 1 834 003 | 1 891 780 | |
| Loans and borrowings | 6 | 26 092 356 | 27 162 628 |
| Total non-current liabilities | 26 092 356 | 27 162 628 | |
| TOTAL LIABILITIES | 27 926 359 | 29 054 408 | |
| Share capital | 2 500 | 2 500 | |
| Retained earnings | 4 260 043 | 2 700 004 | |
| TOTAL EQUITY | 4 262 543 | 2 702 504 | |
| TOTAL EQUITY AND LIABILITIES | 32 188 902 | 31 756 912 |
Siim Sild
+372 5626 0107
siim.sild@unitedpartners.ee
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