Catella concluded a successful year with a strong quarter. Compared to 2021 full year operating profit more than tripled to SEK 618 M, while Assets under Management increased by 15 percent to SEK 141 Bn. Backed by a strong financial position, we look forward to invest in long-term value creation and generate value for our customers, shareholders and society in 2023 and beyond.
Since the decision in 2021 to focus on property operations, we have continued to deliver on our targets and advanced our position in prioritised markets. The focused Catella that we continue to build now summarizes its strongest year to date. The results are built on a dedicated strategy and efforts to strengthen our three property-focused business areas in 12 European markets. Our progress is also founded on our belief that qualified advice, investment management, and own investments generate value over time and therefore require a long-term approach from a social, environmental and investor perspective.
2022 was characterized by strengthening our position and product offering in existing markets, entering new markets, and by ending businesses with limited synergies and low profitability. This included acquiring a majority share in WPP in Poland (now Catella Poland), which opens up opportunities for growth and investments in an additional major European market with high potential. Through our UK company Catella APAM we also entered the Irish market where we are now pleased to offer our services. In Corporate Finance, we focused operations to five markets from a previous eight, and can now wholeheartedly focus on strengthening Corporate Finance on these remaining markets.
In addition to structural changes we also advanced in the area of sustainability. For example, we launched our second Article 9 fund under Sustainable Finance Disclosure Regulation (SFDR), which means that the fund’s investments have a direct positive impact on the environment and society, while also not negatively affecting other sustainability goals. The fund’s long-term ambition is to develop 100 energy-positive residential properties around Europe. In addition, we decided on our long-term ESG strategy and goals at group level, a very significant step forward for us.
Assets under management up 15 percent in the year
During the year, assets under management increased by SEK 18 Bn to SEK 141 Bn in Investment Management. Compared to the previous quarter, assets under management decreased slightly as an effect of the strategic sale of 34 residential properties in Germany and the Netherlands. The reason behind the transaction was to modernize the property portfolios and to release liquidity for new investments with an improved sustainability profile.
On a subdued transaction market with reduced investment appetite and lower capital inflows in the most recent quarter we are encouraged by that interest in products with a sustainability profile remains strong. We will continue to invest the substantial liquidity in funds in future-focused assets. In addition, we are pleased with our balanced offering and expertise in managing underperforming property assets in our management mandates, and we strongly believe that our Asset Management companies will grow ahead, as value-add and re-positioning mandates will be key market needs from 2023 onwards.
A strong year for Principal Investments
Principal Investments completed three sales of development projects in the year, which contributed to an operating profit exceeding SEK 180 M. Given the current market conditions, no divestments were made in the fourth quarter and we continue to lean on our strong financial position awaiting the market uncertainty to subside.
At the same time we continue to develop our projects according to plan, albeit at a slightly slower pace and identifying opportunities for the next long term value investments. The European property market will certainly be exciting in 2023 and we anticipate interesting investment opportunities that we can back by our strong liquidity.
At the end of the quarter, Principal Investments’ investments in six countries totalled approximately SEK 1.2 Bn in 9 projects.
Positive result despite slow transaction market
At the start of the year, a decision was made to discontinue Corporate Finance operations in Germany and the Baltics in order to wholeheartedly allocate time and resources to develop operations on the five remaining markets. The focus of the operations is behind the year’s positive operating profit of SEK 22 M despite a very slow transaction market during the second half of 2022.
Priorities looking ahead
In order to take the next step in our profitable growth journey, we have identified four prioritised areas that we will focus on over the coming years.
With the strong financial position of Catella and in our funds, we look forward to investing in long-term value creation and to generate value for our customers, shareholders and society in 2023 and beyond.
Christoffer Abramson, CEO and President
Catella presents the Interim Report and answers questions today at 10 a.m. CET. To participate, go to
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