UPP Olaines OÜ Consolidated Audited 2023 Annual Report
Management report
UPP Olaines OÜ (hereinafter “the Company” and together with subsidiaries “the Group”) was formed for the financing, acquisition and management of the Olaines Logistics Park investment property (buildings and land). Olaines Logistics Park has two warehouse buildings: warehouse building 1 and warehouse building 2 and is located in Šarlotes, Olaines County, Olaines Municipality, Latvia, land register number 8080 003 0029, recorded in the land register of Olaine Municipality No. 5439. The area of Olaines Logistics Park is 37 204 m2 and the major tenant is Maxima Latvija SIA.
UPP Olaines OÜ consolidated revenue for 2023 was EUR 2.730 million (2022: EUR 2.672 million), up around 2.2% year-on-year. Annual index-based rent increases contributed to revenue growth. Operating profit for the financial year was EUR 2.326 million (2022: EUR 3.275 million) and net profit was EUR 937 thousand (2022: EUR 2.220 million).
Lower operating and net profit were attributable to revaluation of investment property in 2022 and higher net interest expense. Approximately 64% of interest expense (EUR 955 thousand in 2023) is fixed and unaffected by fluctuations in the 3-month EURIBOR. Improved operating efficiency and rent indexation contributed to achieve EBITDA growth compared to the same period from the previous year.
In March 2023, SIA Olaines Logistics and Luminor Bank AS signed a loan amendment under which the loan term was extended with a right to increase the outstanding principal balance to an amount equal to the initial loan amount. The agreement was aimed at extending the term, fund the construction of a 2MW solar park and consolidate aggregate loans of UPP Logistics Properties OÜ.
As a result of the property acquired to construct a solar park, on 19 May 2023, SIA Olaines Logistics was entered in the land register as the owner of property 8080 003 0664. The first 25% instalment was made for the future solar park during the reporting period, classified under non-current prepayments.
On 21 April 2023, SIA Olaines Logistics extended the lease with NNL LV SIA to 2031. NNL LV needed additional cold storage space, therefore we terminated the lease with Girtekos Logistika SIA subtenant and provided an additional 864m2 of freezer space to NNL LV.
During the reporting period, key expenditures related to investment property were incurred totalling EUR 108 thousand, including the capability to connect a backup generator to cold storage, updates to administrative premises and installation of LED lighting for dry storage space.
UNITED PARTNERS
Siim Sild
Managing Director
+372 5626 0107
siim.sild@unitedpartners.ee
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