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Published: 2022-04-28 07:24:18 CEST
Arco Vara
Quarterly report

Unaudited consolidated interim report for Q1 2022


The first quarter of this year brought important changes to the Arco Vara group – we founded a construction contracting company Arco Tarc OÜ. This company provides services to the developments of Arco Vara with the main task of ensuring efficient construction activities. Today, the team of Arco Tarc employs five specialists of their field whose first site is Kodulahe Rannakalda stage.

The premium-class building in Rannakalda in particular has been under observation both in terms of sales volumes and construction prices due to the geopolitical situation of the first quarter. Considering that the fluctuation of construction prices also impacts sales prices and the completion of buildings is planned for early 2024, we do not intend to hurry up with preliminary sales. In the starting stages of the project, we have concluded sales contracts on approximately 30% of total volume and we continue at an easy pace.

With increasing interest rates, Arco Vara can be glad that the 18 million development loan for Rannakalda from Coop Bank is concluded with a fixed interest rate and we have no reason to worry about the fluctuations of Euribor in the next few years.

The second quarter is expected to bring the completion of the stages of Pagi 3 and Pagi 5 at Kodulahe, as works are in schedule and preliminary sales contracts have been concluded for all apartments as of today. Again, sales revenue and profit should be seen on the income statement!

The year 2022 marks 100 years of diplomatic relations between Bulgaria and Estonia. Arco Vara will also attend the celebrations, international cooperation is useful for both parties.

As an aftershock of Covid, there is certain waned interest in office premises across Sofia. Currently, the challenge for the Bulgarian team is one vacant office space sized nearly 800 m2 in Madrid Blvd building and finding a tenant for it has taken longer than anticipated.

However, the development of Botanica Lozen Residences is nearing the process of applying for a construction permit, the objective of acquiring it is set for the second quarter of this year. Even though the buildings are still being designed, a booking agreement has also been concluded with a client in the interim and new interest in the first 16 private homes is seen daily.

The objective of our team for the next quarter is the continued concluding of preliminary and final sales for the Kodulahe buildings and booking contracts for Botanica Lozen.


In Q1 2022, the group’s revenue was 302 thousand euros, which is times higher than the revenue of 9,166 thousand euros in Q1 2021.The group’s revenue for a period depends on the completion time of the apartment buildings.

In Q1 2022, the group’s operating profit (=EBIT) was 103 thousand euros and net profit 16 thousand euros. In Q1 2021, the group had operating profit of 1,809 thousand euros and net profit of 1,700 thousand euros.

In Q1 2022, one land plot was sold in Latvia. In Q1 2021, 58 apartments had final sales in projects developed by the group.

In the Q1 of 2022, the group’s debt burden (net loans) increased by 979 thousand euros up to the level of 10,300 thousand euros as of 31 March 2022. As of 31 March 2022, the weighted average annual interest rate of interest-bearing liabilities was 5.3%. This is an increase of 0.1% compared to 31 December 2021.


The revenue of the group totalled 302 thousand euros in Q1 2022 (in Q1 2021: 9,166 thousand euros), including revenue from the sale of properties in the group’s own development projects in the amount of 31 thousand euros in Q1 2022 (in Q1 2021: 8,902 thousand euros).

Most of the other revenue of the group consisted of rental and property management services income from commercial and office premises in Madrid Blvd building in Sofia, amounting to 203 thousand euros in Q1 2022 (in Q1 2021: 194 thousand euros). By the time of publishing the present report, one office space was vacant, but all commercial spaces, together with parking places, were rented out. The free office space makes 11.7% of the rented office and retail area.

In Q1 2022, the construction company Arco Tarc OÜ was established, which laid the foundation for a new business segment. In 2022, the service will be offered only intra-group with a fixed profit margin of 4%.

The construction of buildings in Stages IV-V of Kodulahe is nearing completion. Two 36-apartment residential buildings at Pagi 3 and Pagi 5 in Merimetsa are under construction. Construction has progressed according to plan. The apartment buildings will reach the stage of final sales in summer 2022. All 72 apartments have been presold.

The construction of the Stage VI of Kodulahe project at Lammi 8 started in February 2022 by Arco Vara’s own construction company Arco Tarc OÜ. The plan is to build a pavilion, 4 commercial areas and 108 apartments, out of which many have sea view. The apartment buildings will become ready in about 2 years after the construction begins. Apartment sales also commenced in February 2022. As at the date of publishing the annual report, 28 apartments out of the 108 had been presold. The company is limiting the number of apartments to be presold, in order to respond to the effects of inflation in the course of the development as necessary.

A subsidiary of Arco Vara, Aktsiaselts Kolde, signed an agreement for land acquisition beside Lake Harku, address Paldiski road 124b, Tallinn. More than 35,000 m2 of residential and commercial real estate (GBA) is planned for development. The expected development period is 6 years with the start of construction planned for 2023. The detailed planning is in process.
The plan is to build a cluster house with 5 homes Pirita Kuldlehe project. Preparations for the site are underway. Construction is planned for the second half of 2022 and the house will be completed within a year. The sale of the project has not started.

The last vision of the Botanica Lozen project foresees construction of 54 homes (houses) in three stages. The expected start time of construction is the autumn of 2022, when the construction of the first 16 buildings will start. Minimum construction period is 2 years.

As of 31 March 2022 and the date of this report, 3 Marsili residential plots remained unsold in Latvia.


In thousands of euros3m 20223m 2021
Revenue from sale of own real estate318,902
Revenue from rendering of services271264
Total revenue3029,166
Cost of sales-109-7,119
Gross profit1932,047
Other income19410
Marketing and distribution expenses-44-35
Administrative expenses-239-184
Other expenses-1-29
Operating profit1031,809
Finance costs-87-109
Profit before tax161,700
Net profit for the period161,700
   attributable to owners of the parent161,700
Total comprehensive income for the period 161,700
   attributable to owners of the parent161,700
Earnings per share (in euros)  
- basic0.000.19
- diluted0.000.18



 In thousands of euros31 March 202231 December 2021
Cash and cash equivalents2,4601,863
Receivables and prepayments3,8933,701
Total current assets24,56521,325
Receivables and prepayments225
Investment property9,4199,943
Property, plant and equipment176154
Intangible assets7887
Total non-current assets9,69510,189
TOTAL ASSETS34,26031,514
Loans and borrowings7,6266,043
Payables and deferred income3,5222,368
Total current liabilities11,1488,411
Loans and borrowings5,1345,141
Total non-current liabilities5,1345,141
Share capital7,2727,272
Share premium3,8353,835
Statutory capital reserve2,0112,011
Retained earnings4,8604,844
Total equity attributable to owners of the parent17,97817,962
TOTAL EQUITY17,97817,962

Tiina Malm
Arco Vara AS
Phone: +372 614 4630


Overview 2022_Q1.pdf