The interim consolidated financial statements of Kaldalón hf. for the first half of 2025 were approved by the Company's Board of Directors on 21 August 2025.
Substantial Revenue Growth Driven by Prior-Year Investments
- Rental income increased by 24% year-on-year.
- Operating profit margin (NOI ratio) stood at 78% for the period and remains high.
- Investments amounted to ISK 3.5 billion during the period.
- Profit before income tax amounted to ISK 1,753 million.
- Return on equity was 11.3% on an annualized basis.
- The Company raises its earnings guidance for the year.
Key Milestones During the Period
- Cash flow from operations increases by 74% year-on-year, adjusted for changes in operating assets and liabilities.
- Acquired approx. 10,000 m² of real estate.
- Conditional purchase agreements have been signed for the properties Krókháls 16, Skúlagata 15 and Klettháls 1a in Reykjavík.
- Construction commenced on new industrial premises at Fossaleyni 19-23 for a client.
- Market-based funding increased to 35% of total debt from 21% in line with the long-term strategy. 82% of the Company's real estate portfolio is now mortgaged under the general security arrangement.
- Environmental certification of properties progressing well. Around 30% of the portfolio is expected to be certified by year-end.
Key highlights of the financial results are
| H1 2025 | H1 2024 | |
| Operating revenues | 2.638 | 2.132 |
| Revenue Weighted occupancy rate of delivered properties | 96 % | 97 % |
| Operating profit before fair value adjustments | 2.056 | 1.672 |
| Operation net profit margin | 78 % | 79 % |
| Gains on fair value adjustements | 1.833 | 2.777 |
| Profit before tax | 1.753 | 2.454 |
| Return on equity | 11,3 % | 17,3 % |
| Cash balance at end of period | 1.244 | 3.531 |
| H1 2025 | 2024 | |
| Investment properties | 78.848 | 73.444 |
| Total Assets | 80.916 | 75.823 |
| Interest bearing debt | 45.432 | 42.117 |
| Equity | 27.344 | 25.938 |
| LTV ratio | 57,6 % | 57,3 % |
| Equity ratio | 33,8 % | 34,2 % |
All amounts are in million ISK unless otherwise stated.
Updated Outlook
The Company updates its outlook for the 2025 financial year. Operating revenues are expected to be in the range of ISK 5,500-5,670 million, based on an assumed average inflation rate of 4.1% in the second half of the year. Operating profit is projected to be in the range of ISK 4,270-4,430 million. The forecast assumes that the announced transactions relating to income-generating properties will be completed in the third quarter of 2025.
CEO's Statement - Jón Þór Gunnarsson
"Solid operations and continued growth characterize the first half of the year. We are now seeing the benefits of prior years' investments, resulting in 24% revenue growth and a stronger position for the Company. At the same time, we maintained a 78% operating profit margin (NOI ratio), which remains very strong.
During the period, Kaldalón invested ISK 3.5 billion, with most of the investments made late in the half-year. Revenues from these will therefore be recognized in the second half of the year. These investments include Suðurhraun 4-6 in Garðabær and Grjótháls 2 in Reykjavík. A new service station was also delivered at Lambhagavegur. Kaldalón has, in a short time, developed a dense network of car-wash facilities for a client, with strong demand underscoring the quality and potential of arterial-road sites owned by the Company. Building permits have also been approved for 3,400 m² of industrial premises at Fossaleyni 19-23 in Reykjavík, to house food production. Delivery is scheduled for the second half of next year.
The Company has signed purchase agreements, subject to customary conditions, for Krókháls 16, Skúlagata 15, and Klettháls 1A in Reykjavík. These acquisitions are expected to increase annual revenues by ISK 203 million once completed.
Total assets at mid-year amounted to just under ISK 81 billion. Interest-bearing debt was just over ISK 45 billion, with the loan-to-value ratio broadly unchanged at 57.6%. During the period, the Company issued bonds and commercial papers in the market totaling ISK 6.7 billion. Listed debt now represents 31% of interest-bearing liabilities, in line with the strategy of increasing indexed debt and market-based financing. The Company's market funding terms indicate considerable opportunities for refinancing.
Demand for rental space remains stable, and the economy shows resilience to a high interest rate environment. There are no indications of a change in this trend, although the long-term effects remain to be seen. Risk-free rates increased during the period, with a negative impact on property valuations. Kaldalón continues to benefit from strong cash flows, with a weighted average lease maturity of nearly 10 years.
The Company is well positioned to serve its clients' needs and capitalize on the many opportunities we see in the real estate market."
Purchase Agreements for New Properties
Purchase agreements, subject to conditions, have been signed for Krókháls 16, Skúlagata 15, and Klettháls 1A. The total purchase price is ISK 2,335 million, payable in cash and/or by assumption of debt. The acquisitions are expected to increase Kaldalón's annual operating profit by ISK 171 million. Completion is anticipated in Q3 2025.
Interim Financial Statements 2025
The condensed interim financial statements have been prepared in accordance with IFRS. The report of the Board of Directors and CEO is included therein.
Investor Presentation
In connection with the publication of the results, an investor meeting will be held on Friday, 22 August, at 08:30 at Grand Hotel, Sigtún 28, Reykjavík. Doors open at 08:15. Management will present the Company's operations, interim results, and outlook. The presentation material will be available on Kaldalón's website at the start of the meeting.
The full report is available at kaldalon.is/investors.
Further Information
Jón Þór Gunnarsson, CEO
jon.gunnarsson@kaldalon.is
www.kaldalon.is
