SPACES that
care for PEOPLE

MESSAGE FROM

C E O

I am proud of our talented team who have broken the 200 million barrier in sales – a 30% increase compared to 2021. If you add to this the fact that this year’s refinancing with Alantra resulted in savings of around SEK 10 million per year on the bottom line, with full impact in 2023, the situation is different from just a year ago. As a result, we are now much better equipped to face new challenges including higher electricity costs, inflation, higher market interest rates, and our own growth ambitions.

In a challenging travel market, it is positive to see that, through the Boho Club restaurant, we have been even more successful in attracting the local market, with fourth quarter restaurant sales up 34% compared to 2021. It confirms that the focus on service, hospitality and quality, as well as increased investment in marketing and sales, has paid off. A more stand-alone restaurant that is independent of the hotel not only creates an important stability in the business but also underscores our operational expertise, which is a tool we intend to use to grow the brand in more destinations and properties. An early sign of spring is that apartment sales have picked up again. The fourth quarter underperformed but the first quarter looks good, and my forecast is for nine apartment sales. Hotel bookings and rental activities are also moving in the right direction, and I expect much better figures for the full year for the hotel business compared to 2022. With continued improvements in the restaurant business, combined with stronger hotel and apartment sales, we are clearly heading for a bright spring.

Accounting technicalities mean that earnings do not fully reflect activities during the year. For example, the apartments we are now selling were valued before we started selling, which means that the acquisition value of apartments sold corresponds to the previous valuation and not the real acquisition value. Adjusted for this, the result would have been about SEK 52 million better for the full year. Nevertheless, our ambition is, of course, to continuously improve performance and profitability.

This year’s refinancing with Alantra, as mentioned above, has a positive impact of SEK 10 million per year in the current interest rate environment, which has been an important step in optimising the cost base. Further optimisations will be made as the business enters a more normalised stage. However, I believe that the best solution is growth, where operational synergies and economies of scale are exploited for higher profitability. An example of investments in this direction is the completion of ten new detached villas for the Boho Club hotel, which is expected to contribute to a high contribution margin as early as April and thus improve the profitability of the Boho Club and the business as a whole.

With the strong foundation we have in the company today, I believe that all shareholders expect us to capitalise on our strengths and grow the company immediately through strategic investments to increase sales and profitability. In order to start this journey now and find a solution to the preference share situation, which is the aftermath of Covid-19, we are analysing a balanced way to compensate the preference shareholders that benefits all shareholders and the company, even if it would imply some concessions in terms of accumulated dividends and resumption of ordinary dividends. It should be possible to present a concrete solution that benefits all shareholders and the company shortly.

Marcus Johansson Prakt,
VD Quartiers Properties