Cofinimmo announces first half 2004 results (BE)

Highlights: equity reinforcement with 2 capital increases: € 159.1 million, Egmont acquisition for € 173.7 million: initial yield of 6.15%, net current result per ordinary share at 30.06.2004: € 3.82 in line with forecasts.

During the 1st semester of 2004, the Belgian office rental market has been affected by the small number of letting transactions concluded and by the decrease of rents in certain districts. Given this unfavourable context the company´s commercial teams have focused on enhancing the loyalty of existing customers, creating reinforced relations with the real estate agents and finally converge rents for marketed properties to the market prices. The success of this exercise has mitigated the impact of the current climate on occupancy rates and consequently on the current result.

Simultaneously during the past semester, Cofinimmo has undertaken an important investment project. Based on an initial yield of 6.15%, the company has acquired the Egmont complex, which is 100% let for 18 years to the Public Federal Service of Foreign Affairs, Foreign Trade and Development Aid. This operation allows the company to improve its net current income by almost EUR 0.20 per ordinary share on average during the following 5 years as well as the quality of its portfolio. It adds up to last year’s commitments on the North Galaxy (18 year lease) and Tour Albert (25 year lease) projects, where works are still progressing according to schedule. The reception as well as the favourable impact on the company’s result will take place at the end of the 1st semester of 2005.

During the past semester, the company has also been particularly active and innovative in financing its activities. It executed 2 capital increases, one to finance half of the acquisition of the Egmont complex (EUR 83.3 million) and the other to refinance the third party stake (institutional investors) in the absorbed subsidiary Belgian Office Properties (BOP) (EUR 75.8 millions). Both transactions have led to the issuing of almost 1.5 million preference shares, with a preferential but capped yield (6% average1), convertible in ordinary shares from 2009. These shares were issued without a discount compared to the stock price and with a premium compared to the revalued net assets.

Moreover, benefiting from the favourable situation of the credit markets, Cofinimmo has refinanced almost half of its financial debt by offering a bond for public subscription (EUR 100 million

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