Good morning, everyone. Welcome to this presentation of Castellum's Q2 report.

There will be a Q&A session in the end of the webcast. If you'd like to ask a question by phone, please dial pound key five on your telephone keypad and ask your question.

Let's start. Go ahead, Pål.

Thank you, Christoffer. Let's start with some highlights from the second quarter.

Divestment to Wihlborgs. We sold all our properties in the Öresund region, minus Copenhagen, to Wihlborgs.

Sales price was SEK 13.3 billion. We also sold the portfolio here in Stockholm with two buildings, we sold it to Alecta, the sales price was SEK 5 billion.

The common denominator for both of those transaction were that we received a good price, we think that we will not be able to meet our return targets given the price we achieved in those two transactions. We have continued to conduct share buybacks.

For the first six months of 2026, we have purchased 39 million shares for SEK 4.6 billion. On the leasing side, Ericsson did not use its option to not lease the full Infinity, they would rather lease the full Infinity.

We also made a leasing contract with Ericsson for two additional buildings in Hagastaden, Emerald House and Jubileumshuset. There are some conditions to those two agreements.

These two lease agreements are not a part of our net leasing this year, probably not until the end of next year in 2027. A short introduction of Castellum.

We have a property portfolio of SEK 134 billion. We also own 37% of the listed Norwegian company, Entra.

Currently, we have 5.2 million square meters, 650 properties, and around 500 employees. That will reduce as we have the closing on the announced transactions.

We are working quite diligently with sustainability and not the least with reducing our energy consumption. This first half year, we have reduced our energy consumption with 2 percentage points.

Net leasing, obviously very important for a commercial real estate company. It's very nice to see a positive net leasing for the first six months of 2026, despite quite big terminations in the last quarter.

Net leasing is SEK 110 million. A lot of that is obviously driven by the Ericsson leasing over Infinity, which is around SEK 140 million.

If we move on to the next slide, you can see the net leasing excluding projects. What you can see here is that it's still negative when we remove the projects we are doing, but perhaps a bit better than it has been for the past three years.

This picture also gives us a nice bridge to the next slide, where we can see our vacancy, which today is 87.5%. It has increased a bit also in this quarter.

What we can see is that the vacancy rate or the occupancy rate has gone down, and this is all due to the net lease that has been negative for quite a long time, actually. Here are some key figures regarding the contracts.

Roughly one-third in annualized terms, there has been action in the contracts. 9% annualized figures has just been prolonged.

No change in rent level. Roughly only 3% has been renegotiated, and those terms have then been 4% lower rent level than before the renegotiation.

Quite a big chunk has been terminated, 11% in annualized terms. A lot of that is actually driven by AFRY.

It was a pretty big contract that was terminated during the quarter. If you weigh in on prolonged and renegotiated leases, the change in rent level is -1%.

Here on the next slide, you can see the in-place rent, the contractual value of our rent levels, how that has changed during the past year. We have disposed assets, and we have removed assets from the like-for-like where we are making projects, and the like-for-like in-place rents have declined with 1.3%, and that's mainly driven by an increased vacancy.

Of course, with increasing vacancy, you get a negative income growth in the like-for-like portfolio and has been -2%, basically the same as we reported in the first quarter. NOI is also negative for the full period, -4.8%.

Negative income growth but also a bit higher costs, mainly driven by a pretty cold winter, so more cost for snow removal and heating, and so on. Over to you, Christoffer.

Thank you. As Pål mentioned, we have been quite active on the transaction market the first six months of this year.

We have signed deals totaling SEK 24 billion of value, which the large one being the divestment to AP7, signed in February, SEK 5.6 billion of public properties. The divestment to Alecta, signed a couple of weeks ago, SEK 5 billion of office properties in Stockholm.

The divestment of our assets and our organization in Skåne, south of Sweden, to Wihlborgs, SEK 14.3 billion, also signed a couple of weeks ago. In addition to that, we have signed a couple of smaller transactions totaling close to SEK 400 million in property value.

This is a mix, mostly offices. One small one in Copenhagen, one small one in Malmö, one small one in Stockholm, a couple of ones in Linköping.

Different categories and different geographies. The total signed divestments has been done at a value just below SEK 500 million, or 2% above fair value, the quarter before the transaction was signed.

We are, of course, more interested in the return we expect from the properties to give us in relation to the price we get, rather than price versus fair value. Still, worth mentioning, especially given the size totaling SEK 24 billion.

As I said, also a mix of property categories and a mix of geography. Interesting, I would say.

In this table, we have also highlighted both the total profit, that is including all effects, including in the income statements—so also value changes in goodwill, tax effects, et cetera. Bottom-line results.

We have also one line here, profit included in the report, which is what we have recorded in the income statement up until this report. The difference, of course, will come in later reports.

Looking at our property value, it's SEK 134 billion as of this report. But in this figure, then the Alecta and the Wihlborgs transactions are included as they have not been closed yet.

If we exclude them, we have approximately SEK 116 billion of asset value. Please also notice that we, in the balance sheet in this report, have reported properties sold to Wihlborgs as assets held for sale.

So they are not included in the line investment properties. During the period, we have invested SEK 2 billion in our existing properties.

Of this, SEK 1 billion is new construction. Roughly SEK 600 million is tenant adaptations.

Approximately SEK 300 million is maintenance, and then some smaller amounts—energy investments and other investments. This is something new that we have added to the report.

A couple of you guys have asked for it, and here you go. Value changes in the period, +SEK 236 million.

If you divide that, it was +SEK 401 million in the first quarter and -SEK 165 million in this quarter. It's roughly the value change in this quarter from the signed transactions.

The rest there is some big positive ones and a couple of minuses. The Infinity property is up quite a lot after the signing of the lease agreement with Ericsson.

The capitalization rate in our valuations is 5.7%. It has been quite stable over the last couple of years.

The value decline over those years has rather been lower cash flow expectations. Loan-to-value, 37.3%.

Healthy headroom, I would say, against our financial policy, which is not to exceed 40%. We have, during the quarter, terminated our S&P rating.

The reason for that is that we believe that one credit rating is sufficient to support our new strategy. Debt maturities, on average four and a half years, unchanged during the quarter.

We have, during the quarter, refinanced SEK 2.3 billion of secured RCFs. We have issued SEK 3.9 billion of unsecured SEK bonds, a mix of two, three, and five years, average credit margin 99 basis points.

We have also repurchased a number of shorter SEK bonds, SEK 1.7 billion in total value. Stable to decreasing margins, I would say, in both the bond and the banking system during the quarter.

So still good financial markets. Interest-bearing liabilities, SEK 57.3 billion, down from SEK 59.5 billion in Q1.

We expect this to come down even further, of course, when we close the transactions later in the year, and that we will reach somewhere SEK 49 billion-SEK 51 billion, given that we will amortize approximately 40% of the Wihlborgs and Alecta transactions. Average interest rate currently at 3.5%.

That one is up from 3.1% in Q1, and that is driven by the redemption of two eurobonds with low fixed coupons. This was something that we had to do to be able to fully execute on our strategy, including the divestments of properties to Wihlborgs and Alecta.

We would not have been able to do those with the previous bond documentation. The total increase in running financial net will be approximately SEK 200 million on an annual basis.

That's approximately SEK 50 million in the shorter bond and approximately SEK 150 million in the longer bond. ICR 3.2x, it's unchanged.

Our policy is to have at least 3x, we had room there as well. The ICR is stable to slightly decreasing due to the higher interest rates following this redemption of eurobonds that I just mentioned.

In the financial net, we can also highlight that we in Q2 had one-offs of SEK 48 million. SEK 31 million of those relates to this redemption of eurobonds.

Most of that is actually not a cash flow effect, rather only income statement effect. We have, during the first six months, bought back shares, as Pål mentioned, for SEK 4.6 billion.

With that, we concluded the share buybacks relating to both the AP7 transaction and results for 2025. Average price has been roughly SEK 117.

As you might have seen, this morning, the board decided upon a new share buyback program of up to SEK 3 billion, that equals 40% of the proceeds from the Alecta transaction. Actually, 60% of the proceeds from the Alecta transaction.

That is roughly equal to the remaining part of the authorization that the board has from the AGM. As of today, we hold approximately 5% of our own shares.

Income from property management per share increased 7.3% when comparing the first six months of this year with the same period last year. We have, of course, bought back shares during this period for proceeds from the AP7 transaction, that transaction was closed on 15th of June, almost fully in the income from property management during the period.

Looking at the last 12 months, comparing with 2025, it's instead 3.5%. Net asset value per share, here measured as EPRA NRV, has increased 4.6% since year end.

Roughly half of it is due to profit, roughly half of it is due to the share buybacks that we have executed below net asset value. As most of you know, our overall financial target is a return on equity over a business cycle above 10%.

Taking the first half of 2026 and annualizing that figure, we are at 5.2%. Far from the goal, but at least a step in the right direction.

We will continue to fully focus on this in everything we do. With that, it's time for questions.

I repeat, if you'd like to ask a question by phone, please dial pound key five. The first question comes from Staffan Bülow, SB1 Markets.

Good morning, thank you for the presentation. I have a couple of questions starting off with the AP7 divestment.

How much did that impact rental income in Q2?

Do I have actually that figure somewhere here? As I said, with almost the full quarter, as we closed it on 15th of June.

I think in the press release, it was a preliminary closing date of 29th of April. As I said, in the end, it was 15th of June, so almost a full quarter.

If you give me one minute, I can perhaps—I have to come back on that one.

No worries. I can move on to the next question a bit more on capital allocation.

At what share price level would share buybacks no longer be an attractive use of capital in your view?

We haven't really discussed that in the board. It's quite a big difference still between the share price and the NAV, I think it's around SEK 40.

It has not been a topic, of course, when approaching the net asset value, share buybacks won't be as attractive as it is right now. I think we have some headroom still.

Thank you. Following the Wihlborgs divestments, what distribution alternatives are you considering for the excess capital?

Could you consider a mix of dividends, buybacks, or what options are you considering?

I think we are considering all options. Also, as we have said, I think we wrote it in the press release today as well that today we have decided upon the proceeds from the Alecta transaction.

The proceeds from the Wihlborgs transaction will be at a later stage. Of course, we will take all options into the equation and decide what's best at that point in time.

Yes, since the closing is a couple of months ahead, we don't know where share price is moving and so on. It would be a bit stupid to make that decision right now.

We have to come back when we actually know where the markets are when we are receiving the proceeds.

Understood. Makes sense.

Next question, after the announced divestments that you have made here, what share of the remaining portfolio still fails to meet your return requirements?

It's extremely difficult to answer that. It's much dependent on what prices we may achieve on the transaction market.

If we look at the fair values we have today, I wouldn't say it's a big proportion, but it's a significant proportion of the portfolio where we probably would be better off if we could sell them at fair value. As I think I write in the letter or in the CEO comment, it's tricky with fair values because there are very few comparables in the market, so they are guesstimates.

That's why we are discussing a lot with other property companies and other interested investors in what prices may be achievable actually in the transaction market. We do absolutely have a big chunk of our portfolio where if we would receive the fair value, we would probably be better off selling them.

That remains to be seen how much we will get for different type of properties.

Thank you. One final question from me.

Do you see a broader base of buyers of your assets versus the beginning of the year, or is it the same conditions?

I think already in the beginning of the year, actually, was very large and broad interest in transaction market. Perhaps it's increased a little bit since then, as I said, I think it was very large interest already at that point in time.

Thank you. Those were my questions.

Thank you. Next one, Lars Norrby, SEB.

Thank you. Question regarding net lease, obviously positive in the quarter, but negative excluding previously announced lease with Ericsson.

You're also, I think, saying something like conditions in the rental market remains sluggish. Looking ahead at the remaining two quarters of the year, what's your aim in terms of net lease?

The aim can only be to work as hard as we can to get as many signed contracts as possible. Forecast for the demand is something that we can't do.

We don't have that glass ball, so to say. We don't know, but we can only do our best to sign as many lease contract as possible.

Are conditions pretty much unchanged from a quarter ago in the market?

I think when I speak with people within the organization working with leasing every day, I think in Stockholm, they say that there's more activity. We have signed more lease agreements than we did a year ago.

In other markets, in Gothenburg, it's still pretty weak, but it's not declining. Perhaps it has bottomed out.

In our regional cities, it seems like it's a bit sluggish still, but it's not declining at least. That's sort of the message I get when I speak with people.

You had AFRY affecting the Q2 net lease figure by a -SEK 95 million. Is that correct?

Yes.

As I understand previously, it was known that that was upcoming.

Yes.

Is there anything else, remind us, that you're waiting to come in terms of termination from any other tenant of size?

No, not in that size. No.

Finally, jumping to a different figure in the report, the SEK 84 million non-recurring item in income in Q2. I think that was related to one of the property divestments, wasn't it?

Is there anything more non-recurring that you know now coming up in Q3, Q4 on that line?

No. Smaller ones.

There are often smaller ones, but typically they are so small that we don't mention it, and you don't notice them. That one was of course quite big.

As I said, that one was related to one of the properties in the AP7 transaction. In the Wihlborgs and the Alecta transactions, no such effects, or at least not of any size.

Perfect. Thank you.

Next question, Nadir Rahman, UBS.

Good morning. Thanks for taking my question.

Three from me. The first one I'll ask in turn.

You mentioned in the report that you see no reinvestment opportunities at suitable yields. Could I ask where are you looking for these reinvestment opportunities?

In all our markets.

Is that across offices, logistics, other asset classes as well?

It's within the asset classes that we are operating.

Are there any that you're more interested in at this stage that you see are more likely to become suitable in the near term?

To be honest, no. We are looking broadly.

My second question is, you also mentioned that part of the value changes in the existing portfolio, excluding the disposals you see the assumption of lower cash flows for parts of these portfolio. Is this due to softer rents, or is this due to occupancy declines or any other factors that is worth noting?

I would say it's a mix of both. We see no actual real growth in rent levels.

It's rather flat and then slightly, what one could say, pushing forward of the decline in vacancy ratios in the property fair valuation discounted cash flows. It's a mix of rental levels and occupancy.

Do you see these value changes concentrated in any particular region or asset class again?

No, not really. It's across the line, I would say.

Both office and light industry and logistics. Might be a bit better for retail.

We do have a small proportion there. It's two small differences to say that it's a significant difference between the asset classes.

My final question is regarding the hybrid reset date that is upcoming in December, and of course you've also terminated your S&P ratings due too. From the 40% of the disposal allocation that you've assigned to debt, do you see any of this being used for the hybrids, or is this purely going to be used for more traditional debt?

We are seeing it as more traditional debt.

What is your thinking on the hybrids given the current market conditions, given that we are now less than half a year away from the reset dates?

The first call date is in December, and the first reset date is March next year. Something we are evaluating, and we'll come back with both how and when.

Very clear. Thank you.

Thank you. Next question, Fredrik Stensved, ABG.

Thank you very much. Two questions, if I may.

First, on the new table that you show in the presentation today of the proportion of leases being renegotiated and terminated and the change in rental levels, et cetera. It seems like a fairly large change this year versus previous years when it comes to the change in rent level.

Would you argue that this is due to a strategy shift, a new management team, et cetera? Are you more open to the idea of lowering rents to keep the properties occupied than previously, or is there a change in the market?

Difficult to answer exactly what proportion you should book on what account, so to say. I would say that the priority is about the market.

Understood. Secondly, on leasing and occupancy, you previously stated, I think several times, that it will get worse before it gets better and occupancy has come down.

Have all the major terminations primarily from last year now? Are all of those reflected as of today or are there any significant move-outs that still remains for the upcoming quarters and years?

All of the large ones from the beginning of last year is in these figures.

Very good. Thanks.

Thank you, Fredrik. Next question, James Cattell, Green Street.

Good morning. I just had a question on the hybrid bonds, but that's already been answered.

Thank you.

Thank you, James. I think that was the last question for today.

Thank you all for listening in and have a great summer.