Turnover increased by 25.%, to 108.1 mln. (Q1-Q3/2006: 86.4 mln.), due mainly to property acquisitions resulting in an increase in leasable premises. Profit before taxes amounted to 243.5 mln. (131.9 mln.), including a 212.7 mln. (97.0 mln.) increase in the fair value of investment properties.
Citycon's net rental income increased by 25.9% in the reporting period, to 76.3 mln. (60.6 mln.). Net rental income for like-for-like properties rose by 9.1%. Earnings per share were 1.01 (0.64). Earnings per share (basic), excluding the effects of changes in fair value, gains on sale and other extraordinary items were 0.12 (0.15) The reduction was mainly due to increase in net financial expenses, increased development activities and costs related to expanded business operations, divestment of non-core properties and higher number of shares.
Net cash flow from operating activities per share amounted to 0.14 (0.14). Net asset value per share (EPRA NAV) grew to 4.94 (3.42). The equity ratio was 41.2% (36.2 %). According to an external appraiser, the average net yield requirement for investment properties was 5.7% at the end of the reporting period.
In addition to Iso Omena and Magistral, acquisitions during the period included Tumba Centrum, Strömpilen and Länken in Sweden. In February, the company carried out a directed share issue worth 133.8 million by issuing 25,000,000 new shares. During the period, the company decided to initiate development projects in Estonia and Sweden for an estimated total value of 178 million. Lippulaiva shopping centre development project in Espoo will now be continued according to plan as the zoning appeal regarding the shopping centre's expansion was dismissed by the Supreme Administrative Court.
CEO Petri Olkinuora: "Citycon continued to implement its growth strategy through continuous redevelopment of its properties and proactive management of its retail properties, reporting strong growth in like-for-like net rental income in the reporting period, and improved occupancy rate compared to the previous quarter. For its long-term success, the company perceives cash flow as a key measure.
During the reporting period, Citycon acquired shopping centre Iso Omena in Espoo. Iso Omena is a first-class centre with further opportunities for expansion and refurbishment. Iso Omena is located in the affluent western part of the Helsinki Metropolitan Area, where the company from previously holds several retail properties. The acquisition offers Citycon a unique opportunity to develop the area's shopping centres as a whole, and to increase the company's market share in the growing metropolitan retail trade.
In addition to these major acquisitions, the focus of Citycon's strategy is on the company's existing shopping centre portfolio and its continuous development and redevelopment. During the reporting period, development and redevelopment projects progressed according to plan in Estonia, Sweden and Finland. The company aims to make its shopping centres more attractive and pleasant to visit."
Outlook
Citycon expects the development and redevelopment projects to play a central role in its business. The company will remain active in seeking acquisition and development opportunities while implementing its expansion strategy. Citycon estimates that its operating profit, excluding fair value changes and gains on sale of investment properties, will grow in 2007. This outlook is based on the company's focus on the growth in leasable area and therefore in rental income.
Source: Citycon
