Hemnet Group ENG

Cash flow Cash flow from operating activities amounted to SEK 235.0 (127.0) million, of which changes in working capital amounted to SEK -3.3 (1.3) million. The increase in cash flow is mainly attributable to the higher profit from operations. Cash flow from investing activities in tangible and intangible assets resulted in a cash flow of SEK 17.7 (-7.0) million. Cash flow from financing operations amounted to SEK -405.3 (-92.3) million. Financial position The Group’s cash and cash equivalents, including interest bearing securities, amounted to SEK 94.5 (271.6) million at the end of the period and total interest-bearing liabilities to SEK 283.1 (686.7) million. Net debt thus amounted to SEK 188.6 (415.1) million, which corresponds to a debt/equity ratio of 0.6 (2.2) times rolling twelve-month EBITDA. Equity amounted to SEK 1,516.9 (1,349.6) million, which corresponded to an equity/assets ratio of 71.1 (56.9) percent. Quality and sustainability Hemnet’s sustainability efforts is conducted as an integral part of its ongoing operations, which is described inmore detail in the sustainability report, which can be found on pages 16-23. The company does not conduct any permit or notification activities according to the Swedish Environmental Code. Research and development Hemnet’s corporate culture is characterised by a constant desire to refine and improve our products and services. The property platform is built and managed by specialist teams in development, sales, market and product. Learning and development occurs naturally in everyday life between teams. Testing, exploring and taking on new challenges to strengthen our position in the market by building simple and efficient services for our users is a key part of our business. A business characterised by a high rate of development. The vision to be the key to your home journey guides Hemnet’s development work. During the year, SEK 6.5 million (6.0) was capitalised regarding development expenses. The capitalised development expenses are recognised in the balance sheet as intangible assets. Outlook Hemnet sees continued strong visitor development and sees no diminished interest in the property market. The company will continue to develop and improve the product portfolio that is now in place for the main customer groups: property sellers, real estate agents and real estate developers, as well as evaluate and prioritize which additional needs of the housing market players that the company can meet through new or improved services. Furthermore, the focus will continue to be on strengthening our co-operation and our relationships with real estate agents and property developers, which are important partners. Group risks and risk factors All operations are associated with a certain degree of risk-taking, risks that can affect operations, standing and results. Risks related to Hemnet’s operations, as well as its expectations and management, are analysed annually by the Board and Group management. Hemnet continues to have a strong visitor trend to both hemnet.se and the mobile apps, and sees no signs of waning interest in the residential property market. However, there are pressures from old and new competitors and with that competition comes a risk that both visitors, real estate agents and advertisers use services other than Hemnet, which could have a negative impact on the business. In recent years, Hemnet has diversified its revenue streams through a number of changes, including by developing value-added services that give property sellers the opportunity to influence their sale. Hemnet has also introduced new products for companies operating in the residential property market such as real estate agents, property developers and banks. It is important for the company to continue to develop new and existing services that meet the needs of current and future customer groups. The income from property listings is a significant part of sales. Developments in the Swedish housing market can therefore have a significant effect on Hemnet’s operations. Hemnet’s advertising business has continued to develop positively and the company offers advertising both through direct

sales and through programmatic trading. The development and trends for ad purchases in the market can affect Hemnet’s revenue both positively and negatively. The Covid-19 pandemic and the global and regional economic and political changes occurring as a result thereof, as well as changes due to possible future virus outbreaks, can affect the volumes of property transactions and thus also the number of property listings published on the company’s platform. For Hemnet, it is central to have a good relationship with real estate agents and to have a substantial range of property listings. Hemnet’s future business may be threatened if a deteriorating estate agent relationship would lead to a deterioration in the range of property listings. In addition to its own funds, the Group’s operations are also financed through borrowing. As a result, the business is exposed to financing risks, interest rate and credit risks. The Group has a long-term credit agreement that extends until April 2024. Further information on the Group’s debt can be found in notes G21 och G22. For further information on risks, see the section on internal controls and risk management on pages 32-33. Management and employees The organization has continued to grow and the number of employees at the end of the year amounted to 112 people, which is an increase of four people compared with the beginning of the year. The average number of employees at Hemnet in 2021 was 112, with 44 of themwomen and 68 men. Significant events after the end of the financial year No events have occurred after the end of the financial year that have had any significant impact on the business or assessments and assumptions used in the preparation of the annual report. Parent Company’s earnings and financial position Hemnet Group AB (publ) is the parent company in the Hemnet group. From January 2020, the Group’s CEO is employed by the Parent Company. The Parent Company’s net sales of SEK 5.6 (7.1) million referred in their entirety to intra-group services invoiced to other Group companies. The Parent Company’s costs amounted to SEK 59.3 (15.4) million, where the increase in costs consisted mainly of increased external costs, mainly consultancy costs related to the preparations for Hemnet’s IPO. Group contributions received from the subsidiary Hemnet Holding AB amounted to SEK 286.2 (8.3) million, with profit before tax amounting to SEK 227.0 (0.0) million. Cash and cash equivalents amounted to SEK 19.8 (4.7) million. Equity amounted to SEK 996.9 (1,188.8) million. The number of shares amounted to 101,131,478 (100,719,421).

ADMINISTRATION REPORT

HEMNET GROUP | ANNUAL AND SUSTAINABILITY REPORT 2021 · 29

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