Cibus Nordic Real Estate AB (publ)

STO:CIBUS

Earnings Call Transcript

[Operator]

Welcome to the Cibus Q4 2024 Report Presentation. [Operator Instructions]

Now, I will hand the conference over to CEO, Christian Fredrixon; and CFO, Pia-Lena Olofsson. Please go ahead.

[Christian Fredrixon, executive]

Thank you. Thank you, AI voice. It sounded very, very human that AI voice actually. Good morning, everybody. Christian Fredrixon here, CEO of Cibus. We're speaking to you from a sunny but wintry Stockholm today. I'm joined here by...

[Pia-Lena Olofsson, executive]

Pia-Lena Olofsson, CFO.

[Christian Fredrixon, executive]

So good morning, everyone, and thank you for joining us on this conference call to present the Q4 2024 year-end report.

So diving into the presentation. This, as some of you know, is my favorite slide because it says exactly what we do with our slogan. I think it really hits the nail on the head with what Cibus does, converting food into yield. So that's exactly what we do and we aim to do and do every day. So we are a real estate company focused purely on daily goods properties. We aim to create stable cash flows, and that's why we've selected the grocery and daily goods business as the underlying business that we buy real estate assets in. We've been listed since March 2018. Our market cap is approached EUR 1.1 billion as of yesterday. We're the only listed pure daily goods real estate vehicle in the Nordics. And as you are aware of our announcement from the 18th of December last year and going forward, we have now started to create a pan-European pure grocery player with a pan-European foothold. So we've updated the map, as you can see here on the right to include parts of Northern Europe as well through our acquisitions of the portfolio company, Forum Estates in the Benelux, which was closed earlier this year in 2025. We pay a monthly dividend to our shareholders.

So what do we mean when we say these stable cash flows? Just briefly reminding everyone and ourselves about this. We focus purely on daily goods properties, stable underlying business, stable tenants with a large multinational organizations and then the noncyclical daily goods business underlying, people buy food, whatever the weather. What you'll see throughout the presentation is the words pro forma. And that's because we carried out a large number of transactions at the end of the year, which some of them closed earlier this year. So when we use the word pro forma throughout the presentation, we mean the Q4 2024 reported figures and then added on the acquisitions we've closed so far in 2025. Those acquisitions being the Forum Estates, Benelux acquisition, Part 2 of the Danish portfolio, we bought also announced on the 18th of December and the Norwegian acquisition of a single asset outside of Stavanger. That's what we say when we mean pro forma throughout the presentation.

So looking at some pro forma figures already here, 81% of our rental income is from daily goods tenants and 94% of our 642 properties are anchored by daily goods tenants, and then 99% of our rents are linked to CPI development. Steady WAULT and steady store location stability through the stickiness of the underlying business.

What we have done with the acquisitions is that, we have continued to diversify our business. We now have assets in 7 countries. We have more than 640 assets, the largest one still being below -- this used to be 1.7%. This is now 1.3%. This is still 1 asset in Finland, a Kesko hypermarket. And we have now also diversified among our tenants. We now have more than 15 of the major European grocery chains as our tenants, as we will show you a bit later on. Still over 90% of our leases are net or triple net sheltering as a financial property cost. And then we still have and will continue to have a high share of our debt hedged, 96% interest rate hedged.

So looking back on 2024, it was an exciting and fruitful year for Cibus. We started off the year this time last year by refinancing the whole bond portfolio. In some cases, we halved the bond spreads from 700 basis points down to 350 basis points in the beginning of the year there. And we also pushed out the maturity of the first bond to mature to February 2027. That made us come back in acquisition mode. We acquired a portfolio in Sweden. And then backed by a feeling of strong support from our investors, we started to strengthen again our cash earnings per share accretive acquisition pipeline in both the Nordics and also in Mainland Europe.

When the pipeline was strong and solid, we raised a EUR 82 million capital raise in a directed share issue, which allowed us to carry out those larger transactions, which we had identified. And within 3 months, we deployed that raised capital by doing the acquisitions in Denmark, Finland, Sweden and Norway. And, of course, all of these transactions are according to our strategy, cash earnings per share accretive.

And then a larger and transformative transaction was carried out and announced on the 18th of December, which was the acquisition of Forum Estates in Benelux. And it's not only a fantastic portfolio, which matches our portfolio very, very well. They also convert through into yield as a strategy, but it's also a great platform for further growth in the area. And this has also elevated us to a pan-European platform, which already now is giving us some interesting new dialogues on a kind of pan-European basis. So very happy about that.

So summarizing 2024, we carried out 11 acquisitions, total value of about EUR 680 million and increased our property value portfolio pro forma by about 35%. All of the transactions, cash earnings per share accretive as they were, they increased our earnings capacity per share by 9% pro forma and our earnings -- NOI measured as earnings capacity by 37%.

And then looking at our expansion pipeline or time line, sorry, then as you saw, we had steady growth between 2018 and then 2022. We had a period of plateauing between 2022 and then to 2024 when we've now taken off, and we're firmly back on the cash earnings per share accretive growth track.

Looking more at the quarter itself. So transformative acquisitions announced, 7 acquisitions in 7 countries in Q4, 185 properties acquired as mentioned, EUR 650 million, moving the property pro forma value up 35%. And as mentioned, the NOI increased by 37% year-on-year, measured as earnings capacity. And then earnings capacity per share in the quarter itself without the transactions which were closed at the end of the quarter, we increased our earnings capacity by 4% year-on-year, sixth consecutive quarter where we increased our earnings capacity. And then pro forma, the earnings capacity per share will increase to EUR 1.04 pro forma, 9% year-on-year.

We also, during the period, carried out refinancing of our bank loans. We refinanced about 40% of our bank loans that was at lower margin than bank loans were before and about the same level as the Cibus average bank margins as reported. We've also raised about EUR 57 million of acquisition financing for the transactions we've carried out, and those have been at margins below the average margin within Cibus.

I'm also happy that we've continued to have a healthy share of hedging, and we carried out some in hindsight, great hedging in Q4 2024 at what now looks like very attractive levels, 1.90%, 2.06% were the different levels for the hedging we did. So compared to the yield curve or the interest rate curve right now, very, very happy the team carried out those transactions.

In the quarter, we also prepaid the last bond, which matured in 2025. That's what we did 1 year ago when we raised a new bond to be able to repay the bonds maturing in 2024, 2025. We did that and repaid that on the 2nd of December. And then at the end of the period or in this year, what we did, we have raised a new 4-year Eurobond at a 2.5% spread, which is, of course, 1.5 percentage points lower than 1 year ago, the 4-year Eurobond we did in March. So that's an impressive move. I'm happy to see that as well.

And regarding dividends, during the quarter, we paid out monthly EUR 0.22 per share. And as you've read in today's press release, the Board has proposed an unchanged dividend of EUR 0.9 per share to the AGM in April. So that's a stable dividend level, but it also gives the company an enhanced opportunity for internal deployment of capital in accretive investments.

And then moving to the next slide. This is what our property portfolio looked like at the end of Q4. This is a bit of old news, of course, when Forum Estates and the second part of the Danish portfolio and the Norwegian acquisition are coming in. So let's move directly to the pro forma figures instead.

So this is our property portfolio pro forma today, 642 assets, EUR 2.4 billion of property value, almost EUR 176 million of NOI earnings capacity and 1.3 million square meters of lettable area. And when looking on the tenants share of NOI, I think it's interesting to see how the diversification and the tenant mix has changed, adding a number of European players as seen, both on the picture on this slide, but also the names you see there, Carrefour, Jumbo, Colruyt, et cetera, and our wholesalers, which is Albert Heijn in the Benelux, that's one of their brands. But interesting to see that, for example, our 2 previous largest tenants, the still largest Kesko and Tokmanni in Finland, they used to account for over 50% of our NOI, and now that's dropped to just above 1/3. So very many household names of our tenants in the 7 countries. So happy to see that as well.

And then a bit more on Cibus pro forma, what we look like. As you see, the map has been extended. The red dots are assets which have been closed upon during 2025. The blue dots are closed in Q4 2024. And then looking at the pie chart, how the portfolio has transformed. One can see starting with the top left, the properties per country. You can see that it's a good and well-divided [ divisible ] property portfolio going forward as well. There will be probably more diversification to come. When we look at the property value by country, it's same thing there. Denmark and Belgium are fighting for second spot as our largest countries by property value. And then when it comes to NOI income, then you can see that Belgium and Denmark both are about 16%.

Looking at our tenants and how the tenant structure is built up. There are 2 ways of looking at it. One is the pie down to the left, which is called rental income by tenant. So that's line by line, showing that 81% of our rental income is from daily goods tenants. And then the pie chart to the right is then by anchor tenant, i.e., which is the anchor tenant in each property. So that's 94% of our properties showing that they're anchored by daily goods tenants. And what's also interesting is, comparing these 2, you can see that the division is pretty much the same, which means that every single asset is more or less anchored by the same tenant. There's only 1 tenant in most of our assets. That's what the comparison of these charts show when putting them side by side.

And then just moving on briefly to talk about the acquisitions announced in Q4. I won't dive too much into the Forum Estates deal and the transaction because if you want to read more about that, then there was an extensive presentation on that delivered on the 18th of December last year. So there's a presentation and webcast on that on our website for those of you who want to dive more into that. But an update on the situation is that, the transaction closed at the end of January 2025. It's a great converting food into yield portfolio, as mentioned, much like ours, great strategic fit, 149 assets, just over EUR 500 million of asset value, a local team in place, which we are working on integrating and getting to know our colleagues better. So we're having great fun with them. It's a cash earnings per share accretive transaction from day 1 and it is helping us in creating a leading pan-European daily goods real estate platform.

In the end, almost 88% of the shareholders or the subordinated loan holders of Forum Estates offered to convert their loans into Cibus shares, and that meant we issued 13.3 million new shares. We've taken room to make issues of 14.2 million new shares as if we do not know if 100% would convert. But we're very happy with the 88% of the shareholders converted. I'm happy to welcome these about 200 shareholders and subordinated loan shareholders as new shareholders in Cibus. So the integration process is ongoing. The first time the Forum Estates figures will be in our results is, of course, in our Q1 figures where part of that quarter will include the Forum Estates figures as they closed at the end of January. So together, we're looking for more cash earnings per share growth opportunities in the Benelux.

And then moving on to talk a bit more about the Danish acquisition we announced on the 18th of December. It's a great portfolio. In my view, we got lost a bit in the attention of the Forum Estates transaction, which came out the same day. But this is a great supermarket portfolio, which we managed to acquire in Denmark. It was bought from ATP, which is a Danish pension fund who put this portfolio together over a number of years. So very happy to get our hands on this. So 31 properties, it's a modern portfolio. It's 99% daily goods tenants. So it's individual supermarkets spread out over Denmark. The acquisition price, the underlying property value was EUR 118 million, which is about EUR 3,260 per square meter. Lease length, almost 7 years. The tenants are REMA 1000 or the tenants and the brands are REMA 1000, the Netto Group, Netto Stores and Coop Danmark.

Modern assets, EPC ranking, 100% are A or B ranked and its taxonomy aligned. And then 65% of the assets were built after 2014 and only 5% were built before 2010. So it's a real modern portfolio. The first part was closed in December last year, and then the second part was closed in February this year.

Moving on then to the transactions in Sweden and Norway in Q4. Then there were 3 single asset acquisitions, which I think is great that we can show that we're active in all of our markets, and we can do very nice cash earnings per share accretive deals also in all of our markets. In Norway, we bought the asset, which is on the picture on the right, which is a newly built Bunnpris asset. So it's just bottom floor there in a residential building. We bought that for about EUR 2,400 per square meter. In Sweden, we bought 2 assets, one ICA and Willys at the -- a low square meter price of EUR 1,105 per square meter. And then during the quarter, we also sold 1 asset in Angelholm. And this is a small asset bought, it's an ex Coop store. It used to be a Netto store, then it was a Coop store. And now we've sold it to a local investor who is planning to have his own business in the store, not grocery, but still paid a good price for the asset. So EUR 2,200 per square meter. So as one investor put it to me who read the press release said, so you managed to sell an empty grocery asset for double the price of fully let grocery assets in the rest of Sweden. And the answer is yes. So happy to do that and it kind of also shows how we trim our portfolio and work with assets, which are no longer grocery.

Our most important metric that we follow is the earnings capacity per share. And as mentioned, for the sixth consecutive quarter, we have now managed to grow our earnings capacity per share. So 4% year-on-year, just looking at the Q4 figures. And then the pro forma figures, we have managed to raise it 9% year-on-year to EUR 1.04 per share. So happy to see this continued growth.

And now handing over to Pia-Lena for the financial overview. I'd just like to remind everyone that the acquisitions, which we've now announced in December, they've only partly or not at all affected the results that Pia-Lena will be showing, of course, for the fourth quarter and only partly affected the balance sheet at year-end. So, please keep that in mind when we've carried out so many transactions.

[Pia-Lena Olofsson, executive]

Perfect. Thank you, Christian. So here are some key figures for the fourth quarter. Rental income was EUR 31 million. Net operating income grew 2% to EUR 28.7 million. Profit from property management was EUR 11.1 million, but excluding nonrecurring items and exchange rate effects, it was EUR 12.5 million. Earnings after tax amounted to EUR 2.6 million. Unrealized changes in value was included in the earnings and amounted to EUR 7.7 million on properties, which is equivalent to minus 0.4% of property value. And we also had unrealized changes in interest rate derivatives of minus EUR 0.5 million.

So we had significant events during the period. We have been active with several acquisitions during the fourth quarter. The 23rd of October, we announced that we have acquired 3 grocery stores in Finland at the value of EUR 14.8 million. The 29th of October, we acquired 1 grocery store in Sweden of SEK 75 million. The 6th of November, we announced that we redeemed the last bond that matures in 2025. So all refinancing of all bonds has been finalized. The 11th December, the Nomination Committee announced that Stefan Gattberg has been proposed as the new Chairman of the Board. Patrick Gylling declined reelection as Chairman, but is available to serve as ordinary Board member. All other Board members are proposed for reelection.

The 18th of December, we announced that we were considering to acquire Forum Estates in Benelux. The same day, the 18th of December, we also announced that we had acquired 31 grocery stores in Denmark, of which 22 was taken in possession the same date and 9 had right-of-first-refusal options and was acquired all 9 properties at the 5th of February 2025. The 20th of December, we acquired 3 grocery stores in -- and 2 in Sweden and 1 in Norway, and we sold 1, as Christian said.

So we also have been active after the period. So the 10th of January, we announced that we issued a new unsecured green bond of EUR 50 million. It had a margin of 250 basis points with a 4-year tenure, which is the lowest margin to date. In the 10th of January also the Nomination Committee announced that Stina Lindh Hok has been proposed as a new Board member at Cibus. The 14th of January, we had an Extraordinary General Meeting at which the Board of Directors were mandated to acquire Forum Estates, which we did the 27th of January, and we approved the new issue of 13 million shares as consideration for the acquisition. And as mentioned, we take possession of the 9 previously communicated properties in Denmark.

So if we go into more details, we had high activity with our acquisition, as mentioned during the quarter. We do have a nonrecurring expense of minus EUR 0.6 million due to an advanced acquisition process where the transaction has not been completed and was not completed. Net financial items include a nonrecurring item for the early redemption of minus EUR 0.6 million for the last bond that mature in 2025, as well as an exchange rate change of minus EUR 0.2 million. Net financial items also include interest costs for the called bond of minus EUR 0.4 million for the fourth quarter, and this is not classified as a nonrecurring cost. And now all the old bonds have been repaid and we will not have additional costs for them.

Unrealized changes in value on properties affected earnings with minus EUR 7.7 million. Property values rose in all Nordic markets, except in Finland and the negative change in Finland is in the fourth quarter, mainly due to a building in the center of Helsinki with only minor grocery components and will probably, in the long term, be more suitable for -- to be developed to a residential property.

Looking at earnings capacity, the 1st of January shows a net operating income of EUR 122.3 million, which is an increase of plus 7% from 1st of January 2024. And if we add the earnings capacity from the acquisitions made up until today pro forma, the NOI amounts to EUR 155.7 million, which is an increase of plus 37%. Profit from property management, minus expense for the hybrid bond and adding back noncash items amounted to EUR 62.3 million or EUR 0.99 per share. Adding the acquisitions made, profit from property management cash pro forma amounts to EUR 79 million or EUR 1.04 per share, an increase with plus 9% since January 2024.

Looking at the net operating income in a comparable portfolio, effect of changes in occupancy was unchanged since Q3 2024 at minus 0.9% (sic) [ 1.9% ]. Indexation is lower due to low inflation in the Nordic countries. The index increase in Sweden and Norway is from the 1st of January every year, while in Finland and Denmark, it's on the anniversary of when the agreement was signed.

Cibus segments or countries. Finland is the largest with 68% of NOI in the fourth quarter. Looking at the pro forma figures, including acquisitions, Finland's part of NOI will be 51% and Denmark and Belgium will be -- will have 15% each on NOI.

Looking at the balance sheet at the end of the fourth quarter, property value was slightly below EUR 1.9 billion. Secured debt was EUR 947 million, giving a loan-to-value on secured debt of 50.6%. Unsecured bonds were EUR 191 million, giving a net loan-to-value of 58.1%. Net asset value EPRA NRV was EUR 735 million or EUR 11.7 per share.

The weighted average remaining lease term, WAULT, is continuing to be very stable at around 5 years and was 4.9 years at the end of the fourth quarter.

Regarding funding, closing average interest rate was 4.2% compared to 4.5% last year. Bank financing continues to be the largest part of Cibus's external funding with more than 80% of funding. The average credit margin was 1.6% and a weighted average capital maturity of 2.3 years. EUR 383 million has been refinanced during the quarter at a low credit margin in line with the average credit margin. All current bank loans of EUR 121 million are expected to be refinanced at the end of the second quarter 2025.

Regarding bonds, we now have called and repaid the last bond maturing 2025. And after the period, we have issued a new EUR 50 million green bond with a 4-year tenure at Euribor plus 250 basis points, which is the lowest margin to date.

For Cibus, stable cash flows are very important. Cibus has a high degree of hedging. And during the fourth quarter, we have done additional hedging of EUR 176 million at levels between 1.90% to 2.06%. Based on the earnings capacity and taking all the interest rate hedging into consideration, an increase of the market interest rate with 1 percentage point would affect profit with minus EUR 1.1 million annually. A decrease of 1 percentage point of the market interest rate would affect profit with plus EUR 1.6 million annually.

Looking at the key credit metrics, net LTV has increased to 58.1%. Since the funds raised through the directed share issue has been deployed. Covenants in the MTN program is 70% on the net LTV. Interest coverage ratio is stable at 2.2x and well above the covenant of 1.5x. The net debt-to-EBITDA has increased in the fourth quarter due to the acquisition has increased debt while the EBITDA is built over time.

Cibus generates stable cash flows, so we can pay out dividends on a monthly basis for our shareholders. And the Board proposes an unchanged dividend of EUR 0.90 per share divided between 12 payment occasions.

Cibus share price was SEK 176.2 per share at the end of the fourth quarter. Dividend yield for the full year was 7.7%. Total yield, including the share price increase was 39% for 2024. And with dividend reinvested, the total yield was 41%. Cibus is a very liquid share. During 2024, Cibus' market cap was traded 1.6x, which is more than double the liquidity of the average of all other real estate companies with a market cap of more than SEK 10 billion at Nasdaq Stockholm.

Looking at the shareholder list, the 15 largest shareholders own 42% of the shares. We have continued strong support from the Nordic institution specialists and real estate funds. Many have been shareholders for several years. Cibus has at the end of the fourth quarter, 55,000 shareholders.

Over to you, Christian.

[Christian Fredrixon, executive]

Thank you, Pia-Lena. So moving forward and looking at the future. Our overall strategy is, of course, to continue to grow earnings capacity per share, as mentioned. So that's what we will aim to do and trying to do by increasing income, but also for reducing costs where possible. So we're looking across the business to see how can we continue to increase earnings capacity per share. We're working with integrating the Forum Estates platform, as mentioned, as a platform for growth in the Benelux and together with our colleagues there, both managing the portfolio and also looking for new opportunities in Mainland Europe. We want to carry out cash earnings per share accretive transactions going forward as well, of course. We see interesting opportunities in all of our existing markets, liquid markets as written in the report and in my CEO comments, we see that there is a buoyant market and very interesting opportunities that are arising in many markets. And we're also actively evaluating opportunities in Mainland Europe.

We'll continue with the balance sheet optimization, refinancing and hedging through the form as we've done last year. We have competent and experienced employees now with our employee in the Benelux as well, who together, we are working on taking action and increasing cash earnings per share. And we're committed to deliver shareholder value by converting food into yield. So no surprises there either.

A bit of a commercial break here. So -- but let's move on to the Q&A then, please.

[Operator]

[Operator Instructions] The next question comes from Svante Krokfors from Nordea.

[Svante Krokfors, analyst]

Thank you, Christian and Pia-Lena, for the presentation. The first question is about the dividend. I know it's a question for the Board, not very surprising that you have an unchanged dividend, but in the CEO comment, you mentioned that you're looking for enhanced opportunities for creation of shareholder value through internal deployment of capital investment opportunities. So how should we weigh -- I mean, you also, on your web pages in your earlier communication, say that you aim for a growing dividend. So how should we look at the capital allocation between dividends and M&A going forward?

[Christian Fredrixon, executive]

Yes. Should I -- did you have several questions? Should we start with, Svante? Thank you for calling in, by the way.

[Svante Krokfors, analyst]

Yes, please.

[Christian Fredrixon, executive]

Yes. No, as mentioned, the dividend is proposed to be unchanged. But over time, the strategy is to grow the dividend going forward as well. So that is also unchanged. The company wants and --. Sorry?

[Svante Krokfors, analyst]

Yes. And going forward, how should we look at the weighting between growing dividend and deploying capital into growth investments?

[Christian Fredrixon, executive]

That is, of course, a question for the Board and ultimately, the AGM. But from a management perspective, what we see now is, there's 2 ways we can invest and create cash earnings per share growth. One is, of course, raising new capital to carry out transactions and investments. The other is to deploy capital, which is preserved internally. So I think that you can read that as that is a mix of those 2. I think it's fair to say that if we're doing larger transactions, then we will be coming to the market to raise capital as we have done in the past since inception and listing. And -- but we are also looking at other internal ways to deploy capital in investments in our current portfolio and also in transactions. And, I guess, the dividend, keeping it unchanged as the Board is proposing is one way to do that.

[Svante Krokfors, analyst]

And is your target still to pay an increasing dividend over time?

[Christian Fredrixon, executive]

Over time, yes.

[Svante Krokfors, analyst]

And looking at the transaction market in different countries, what do you see there going on?

[Christian Fredrixon, executive]

Yes. I'd say, looking at the Nordics, Finland is an attractive market, very attractive yield spreads for assets coming to the market in Finland. I mean, international investors in general kind of retracted from the Finnish market since 2022. And that's not uncommon. That's my experience from over 20 years in Nordic real estate is that, when real estate markets become a bit wobbly, then international investors tend to withdraw from Finland quite early on. So that kind of puts a bit more domestic interest in Finland and also less international competition. I think that's what we're seeing still in Finland. But we see interesting opportunities there.

In Sweden, there is a lot of competition for our daily goods-backed real estate transactions. There are several, both institutional players. There's a number of private players who kind of were out of the market or at least not on the buy side during 2022, 2023 and the beginning of 2024, we now see coming back to the market, having raised money. So -- and continued support for financing and for banks in all of our countries that kind of creates competition in Sweden, where we see like institutional investors like the Third AP Fund and a couple of private investors or private groups looking to invest as well. Denmark, -- we want to grow in Sweden as well, of course. It would be great to be able to grow in Sweden, and let's see what we can do during 2025 there.

When it comes to Norway, the yields are about the same as in Sweden, but the financing costs are about 200 basis points higher. So you need to find really those individual cherry or [indiscernible] transactions where you actually can find every now and then some of the transactions, which is cash earnings per share accretive enough for us to be of interest. So we've had 1 transaction last year there outside Stavanger.

But Denmark is a very liquid market with lots of things happening last year and hopefully also this year. And across all of the markets, we see a lot of sale and leaseback activity as well where the grocers themselves who've been building up portfolios are now coming to the market to lighten their balance sheet by carrying out sale and leasebacks.

When it comes to the Benelux, Belgium is much more of a private-to-private market, so individual assets being sold and bought. So we're hoping to tap into that market as well, of course, now with our colleagues in the Benelux. The Netherlands is a very interesting market for us. Plenty of room to grow for us there. Forum Estates started buying assets there in 2021. It's a professional supermarket market with both private investors, but also private groups and kind of funds working there and selling and buying smaller portfolios. So an interesting market as well there. And then we're looking at the parts of Mainland Europe as well to see what other opportunities there may be out there.

[Svante Krokfors, analyst]

That gives good color on the situation. Perhaps a last question to Pia-Lena regarding the debt outlook for the acquired debt from Benelux and Denmark going forward?

[Pia-Lena Olofsson, executive]

Yes. As we said in the presentation when we announced the acquisition of Forum Estates that we have received waivers from the banks, and we will roll over that debt as mentioned earlier. And the average cost on debt was 3.8%. When it comes to the acquisition of the Danish portfolio, as Christian said also, we have raised additional bank financing at lower margin than the average margin that we have today or end of the [ quarter ].

[Operator]

The next question comes from Ventsi Iliev from Kempen.

[Ventsi K. Iliev, analyst]

First one, a clarification question on the Danish portfolio. Did you buy that with available cash? Or did you draw on Danish mortgages?

[Christian Fredrixon, executive]

Ventsi, thank you for dialing in. Yes, the money we raised in the September dividend -- sorry, the directed share issue in September 2024, that was the equity component used for the transaction. And then we financed it with about 50% of local bank debt, which is then financed through the Danish real credit system, which is a very competitive and well-functioning debt market.

[Ventsi K. Iliev, analyst]

Yes. Great. Can you elaborate a bit more on the spread or the interest rate for the loan component?

[Pia-Lena Olofsson, executive]

I mean, we haven't disclosed that to the market. But as you know, the real credit loans are attractive levels and lower margins than our average margin at the end of the quarter.

[Ventsi K. Iliev, analyst]

Okay. And then last one, I mean, you've already highlighted that you are still seeing a very attractive acquisition pipeline. If I look at your LTV and how it has developed over the years, you typically want to stay below 60%, even though your policy allows you to go to 65%. How should I look at this going forward?

[Christian Fredrixon, executive]

Yes. I think there's -- looking historically, we have been under the kind of the 60% level. And the policy, as you mentioned, 55% to 65% and it makes sense financially as well in kind of in a slightly higher interest rate environment than 2015 to 2022 to be kind of the low end of that or the lower end of that LTV policy.

I think we lost Ventsi.

[Operator]

The next question comes from Oscar Lindquist from ABG Sundal Collier.

[Oscar Lindquist, analyst]

Can you hear me?

[Christian Fredrixon, executive]

Yes, we can.

[Oscar Lindquist, analyst]

So most of my questions have been answered, but I have a couple of follow-ups. If we look at the sort of the new shareholders coming from the Forum acquisition, do you have any sense of sort of their long-term intentions? Or have the first tranches sold off? Or can you highlight anything here?

[Christian Fredrixon, executive]

Yes, sure. The first lockup window was on the 5th of February. And as if anyone who's looking at the screens can see that it was a very low number of shares that were transacted as part of that first lockup window. The lockup is being handled by Kempen, of course, who assisted us on the deal. And there was -- it was a very low number. So we're very happy to see that the shareholders of Forum Estates or the former shareholders of Forum Estates, now Cibus shareholders seem to be staying on with us. So very happy to see that.

[Oscar Lindquist, analyst]

Okay. Perfect. And just a follow-up on the Forum acquisition. I understand it will be consolidated by roughly 50% in Q1. Is that correct?

[Christian Fredrixon, executive]

2/3, right? Consolidated 50%. Did you mean time?

[Pia-Lena Olofsson, executive]

Yes. The acquisition was made 27th of January. So from there Forum Estates will be part of Cibus.

[Christian Fredrixon, executive]

So 2/3 of the quarter of Q1 will include the Forum Estates figures.

[Oscar Lindquist, analyst]

Sorry, I have trouble hearing you.

[Christian Fredrixon, executive]

The acquisition -- Forum Estates acquisition closed at the end of January, on the 27th of January. So from that day on, the figures will be included and Forum Estates will be consolidated into Cibus' results. So about 2/3, 2 of the 3 months of the first quarter this year.

[Oscar Lindquist, analyst]

Perfect. And then I'm not sure if I maybe missed it, but did you show a pro forma LTV?

[Pia-Lena Olofsson, executive]

Pro forma...

[Christian Fredrixon, executive]

No, I think have we shown a pro forma LTV? No, we have not shown a pro forma LTV for Cibus plus the transactions we've done. We did communicate in the 18th of December 2024 presentation of the Forum Estates deal that it was an LTV-neutral transaction.

[Oscar Lindquist, analyst]

Yes. Okay. And you presented a sort of earnings capacity adjusted for the completed acquisitions, [Technical Difficulty] central admin costs. Is that a representative figure for the coming 12 months? Or is it also adjusted for the timing of the contribution from the Forum acquisition?

[Christian Fredrixon, executive]

No. The way we set up the earnings capacity, that's forward-looking 12 months. So I think the answer to your question is, yes, it is a forward-looking 12-month figure. It's a snapshot of the next 12 months coming. That's the earnings capacity the way we use it.

[Operator]

There are no more phone questions at this time. So I hand the conference back to the speakers for any written questions or closing comments.

[Christian Fredrixon, executive]

So a couple of questions here. The first one, I think we've already touched upon through the questions from Oscar at ABG. The first -- it's about the Forum Estates form of shareholders. We've mentioned that already on the 5th of February. So, please have a look at the screens there, and you'll see it was a very, very low number of the potential 20% of the shares, which could have been sold, the new shares, which could have been sold. So I think that's the answer to that question.

And then the last question we have here, we've also answered, which is on the LTV pro forma for the Forum Estates transaction, which we also, I think, have answered.

Are there any further questions? Did Ventsi want to come back? Was he cut off? Or is he happy?

Okay. Well, then thank you, everyone, for listening. Great that you joined, and I hope you continue to follow Cibus and what we will be doing in 2025. Thank you for listening.

[Pia-Lena Olofsson, executive]

Thank you so much.

[Christian Fredrixon, executive]

Bye.

[Pia-Lena Olofsson, executive]

Bye.

[Operator]

The host has ended this call. Goodbye.