Welcome to Neobo Q1 report 2023. For the first part of the conference call, the participants will be in listen-only mode. During the questions -and -answer session, participants are able to ask questions by dialing star five on their telephone keypad. I will hand the conference over to CEO, Ylva Sarby Westman. Please go ahead. Good morning, everyone, welcome to the presentation of Neobo's Q2 2023 report. My name is Ylva Sarby Westman, with me here today, I have our CFO, Maria Strandberg, and Head of IR, Johan Bergman. Our vision is to create attractive and sustainable living environments where people can thrive and feel secure. I feel confident that Neobo, with this vision as a starting point, have good opportunities to create value for both tenants and shareholders. In this picture, you can see one of our properties in Sundsvall. Operations have continued to develop in a positive direction, in the like-for-like portfolio, net operating income increased by 6.9% due to both increased rental income and reduced property costs. Profit from property management decreased to SEK 75 million as a result of higher financial expenses during the period. The change in value of properties amounted -3.6% as a consequence of higher yield requirements in the market. Neobo is a residential-focused company with a property value slightly below SEK 15 billion. We have 8,400 apartments in 267 properties, residential properties account for 95% of the property value, the remaining value mainly consists of community service properties. Our rental value has increased by 3.5% from the beginning of the year to SEK 956 million, constitutes of 76% from residential properties and 21% from commercial contracts. The total rental value for residentials has now been negotiated with an average increase of 4.5% that will have full effect during the third quarter. The increase is below current inflation, but as you can see on this slide, property owners have historically been fully compensated for inflation over time, which we expect will also be the case moving forward. You can see the increases in rental value on this slide. Increasing our occupancy rate is top priority. During the second quarter, the occupancy rate is unchanged, but reducing vacancies is a long-term commitment, focusing on a number of measures, such as renovating empty apartments and conducting activities to increase tenant satisfaction and reduce tenant turnover. We see continued strong demand for rental apartments in Sweden, with a growing population, a majority of the municipalities reporting housing shortage, and a very low market vacancy for rental apartments below 1%. According to Boverket, the annual need for new residentials in Sweden amounts to 63,400 during the coming year, which, combined with a very low level of new constructions, gives us an opportunity to increase the occupancy rate in existing buildings. Transaction volumes remain low compared to the first half previous years, and the share of residential properties has also decreased sharply. However, during the spring, we have seen transactions in the residential segment, such as divestments from K2A, Trianon, and Heba, at good price levels. Hopefully, the market will continue to open up after summer. Sustainability is an important and value-creating part of our strategy, and we have therefore started the important work of producing a sustainability strategy and an energy management system with concrete targets. As part of this effort, we have now completed a stakeholder analysis and begun a materiality analysis based on the requirements of the CSRD, Corporate Sustainability Reporting Directive, which sets new requirements for corporate sustainability reporting and is a key component of the EU's strategy to promote sustainable investment and achieve the overall goals. I'm very happy to inform that our General Counsel, Malin Axland, also has taken on the role as Head of Sustainability. Malin has solid competence, extensive experience, and a great commitment when it comes to ESG issues, and I'm convinced that our continued sustainability work will add value to Neobo under her leadership. In the last interim report, we referred to work carried out in Tidaholm with the properties, heating system, and solar cell installation. The properties have now received the Sweden Green Building Council's Miljöbyggnad iDrift Silver certification. During the second quarter, we also began installation of solar cells on a property in Oskarshamn. Rental income increased to SEK 434 million, and in the like-for-like portfolio with 4.7%, due to rent increases in commercial premises and to the portion of rent increases in the residential portfolio that began to take effect during the second quarter. Property management costs decreased during the period by SEK 13 million, and the reduction is a net effect of a slight increase in operating costs derived from higher costs for electricity and heating, which were offset by reduced costs for property administration attributable to lower personal costs. Net operating income increased with SEK 25 million to SEK 226 million during the period. For the like-for-like portfolio, the corresponding increase was 6.9%, mainly attributable to higher rental income. Central administrative costs increased by SEK 7 million. In the period, we had non-recurring costs of SEK 9 million relating to the separation and listing on Neobo and startup costs for the company. Excluding non-recurring costs, central administrative costs were reduced by SEK 2 million due to lower personal costs. Net financial items increased as a result of higher underlying interest rates and raised margins in refinancing, and profit from property management decreased to SEK 19 million as a result of increased financial costs. The value of the property portfolio declined by 3.6% during the period as a result of increased yield requirements for residential properties in the market. The average yield requirement in the valuation has increased from 4.1% in the beginning of the year to 4.4% in the end of June. SEK 84 million was invested in existing properties during the period. We have completed renovation of 48 apartments and also carried out some sustainability investments. Neobo has a strong financial position with a low LTV of 47.5% and 100% of the financing from banks. We have a long average debt duration of 3.9 years, and as you can see to the right, almost no maturities before 2025. The Swedish Central Bank raised the key interest rate to 3.75% in June and indicated that there will probably be at least one further increase during the autumn. Our average interest rate is now 3.1% as a result of higher interest rates. Since we have a high hedge ratio of 77%, our interest costs are not fully affected by increased interest rates, and we have a good predictability of profit from property management going forward. The average fixed interest term increased from 1.7 to 2.1 years, and the ICR amounted 1.7 times at the end of the period on a rolling 12-month basis. Neobo's earnings capacity, it's not a forecast and does not include any assessment for future trends, but the rental income is up 3.5% compared to the earnings capacity in the beginning of the year, since we have now completed negotiations in our residential portfolio. This rental increase will take full effect in the third quarter. Property management costs consists of budgeted costs for a normal year, and our assessment is that they will be on the same level. Net operating income has increased by SEK 8 million since Q1 due to higher rental income. Central administration stays on the same level, but no one-off costs attributable to the separation are included. Net financial items is based on existing credit agreements and STIBOR on the last of June, and profit from property management sums up to SEK 211 million. As of today, we have also implemented some changes in the management team to increase focus on core business. Anna-Carin Skoglund, Head of Region North, and Per Sundequist, Head of Region South, have today joined the management team, while Head of IR, Johan Bergman, has stepped down from the management team. Here you can see our largest shareholders in the end of June. According to Euroclear, the total number of shareholders is now 158,000. Key takeaways from the first half of the year. Continued positive development of operations. NOI increased by 6.9% in the like-for-like portfolio. We have a solid financial position and see a strong underlying demand for rental apartments in Sweden. Our focus remains on increasing the return by raising rental income and reducing vacancies and carry through value-generating investments in the properties. Now we will open up for questions. If you wish to ask a question, please dial star five on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial star five again on your telephone keypad. The next question comes from Bertil Nilsson from Carlsquare. Please go ahead. My question regards to the drop valuation. Have you seen any transactions in your region or any negotiation concerning an unfinished transaction that indicates what yield does it indicate compared to your valuation of your property portfolio? Also there is a talk about a gap between buyers' yield and sellers' yield. Mm. Which lead to few actual transactions closed. Yeah. Any comments about that? Yes. Our external valuations, evaluators, they have, of course, looked into the transaction market deeply before setting the values in the second quarter. We have, as I mentioned, an average valuation yield on 4.4% in our portfolio, and we have seen some transactions in the market supporting that. As an example, Heba sold some properties in Hökarängen, south of Stockholm, on a lower yield level. There are some transactions, but as I said earlier, the volume is absolutely lower than previous years. Still some transactions in the market. Okay. Do we have? As a reminder, if you wish to ask a question, please dial star five on your telephone keypad. There are no more questions from the teleconference, so I hand the conference back to the speakers for any closing comments and written questions. Very much. I will read the question from the webcast. Good morning. Since Neobo share price have a very large discount compared to market value, have you considered to sell properties? That would lower risk and show that it's possible to sell properties as today, at today's valuation, if that's possible. Yes, absolutely. We are considering that, and I think that optimizing the portfolio is good in both when it comes to the efficiency in the property management organization and also in that we will be able to make the balance sheet stronger. Absolutely, we are considering that. Thank you. We have two questions concerning the vacancy, so I will read both at the same time. Why is the vacancy rate so high for residential? Can you elaborate about vacancy, possibilities to lower the vacancy, and the time horizon for progress? Yes. Vacancy in our residential part of the portfolio is 6.4% at the moment. I think, as I mentioned, that we have a good potential to lower the vacancy since the market vacancy is below 1%, and it's almost no new supply to the market at all in this situation. I think that we have a good opportunity, and we are focusing hard on renovating empty apartments, working with activities to in order to increase tenant satisfaction and to be able to lower the turnover rate in the portfolio. I think it's a long-term commitment. It's not a quick fix. We need to do the homework, but the organization is very committed and everything, everyone in the organization is focused on the target to lower the vacancies right now. Thank you. Do you feel comfortable with your ICR going forward with interest rates, on the rising? Yes, I do. I mean, in the quarter, we had ICR of 1.8. We have a financial target that the ICR shall always be above 1.5 times. And since we have a long average fixed rate period of 2.1 years and a high hedge ratio of 77%, I feel very confident that we will, the ICR will. I'm not worried about the ICR, even if the underlying market rents will continue to increase. So we have the situation under good control. Thank you. Just coming back to the vacancy again, if you could elaborate a little bit why it's so high? Yeah. I think it's a number of different answers to that question. One is, as I mentioned, that we need to make renovations to be able to lease them out. Another is that we have in some areas a little bit too high turnover rate, so we really need to focus on tenant satisfaction to be able to lower that rate. We also have some interesting vacancies in the commercial portfolio. I think that maybe we haven't had the focus on the commercials vacancies in the right way before, so we are really working hard with that now, trying to find the right tenants and try to convert some commercial properties also. In some markets, only a few, one, though, we can see that maybe the rent is a little bit too high, so we are looking into that analysis as well right now. Maybe, during the last year, with a lot of mergers and acquisitions and the transactions, it was a difficult situation for the organization to really focus on the task, and I think we have better opportunities now with this purely residential-focused company and a very engaged organization, motivated. Thank you. Considering the very large discount to the share, the share has to NAV, would you be open to liquidation of the company? I don't see that that would be necessary. I think that we have in the business plan and in our strategy, good opportunities to create shareholder values by both increasing the return from the property portfolio, by continue to increase rents and decrease vacancies, and also carry on some value-creating investments, and also optimize the portfolio to be able to add further value. I think that's a better way to go in order to be able to create shareholder value. Okay, thank you. When will the new sustainability strategy be implemented? It will be implemented during this autumn. We are working hard right now with setting the sustainability strategy in place, and so during the autumn, we will start to work in line with it. Thank you, Ylva. There is no further question on the webcast. Thank you very much for listening in. Hope you all have a great summer. We'll have a great summer. Bye!