Financial Results for 1 January-31 December 2009
(Thomson Reuters ONE) - CITYCON OYJ Stock Exchange Release 10 February 2010 at 9:00 a.m.Financial Results for 1 January-31 December 2009Summary of the Last Quarter of 2009- Turnover grew to EUR 48.9 million (Q3/2009: EUR 45.9 million).- Net rental income declined by 2.7 per cent to EUR 31.6 million (EUR 32.5million), mainly due to higher operating expenses than in the previous quarter,reflecting common seasonal fluctuation.- Net cash from operating activities per share was EUR 0.06 (EUR 0.05).- Earnings per share were EUR -0.11 (EUR 0.06).- Direct result per share (diluted) was EUR 0.06 (EUR 0.06).- The fair value change of investment properties was EUR -38.6 million (EUR -1.2million). The fair value change was mainly due to slightly reduced net rentalincome growth in the appraisal assumptions and higher valuation yield in theBaltic Countries. The fair value of investment properties was EUR 2,147.4million (EUR 2,162.7 million).- The average net yield requirement for investment properties remained at theprevious quarter's level and was 6.6 per cent (6.6 %) at the end of the period,according to an external appraiser.- Net financial expenses totalled EUR 12.0 million (EUR 11.7 million).- On the basis of its loan agreement covenants, Citycon's interest cover ratioimproved to 2.3x (2.2x) and equity ratio fell to 40.6 per cent (42.4 %).- Citycon issued new bonds with a total, aggregate value of EUR 40 milliondirected at domestic retail investors. The proceeds thereof will be used tofinance (re)development projects.- During the last quarter of 2009, the Liljeholmstorget shopping centreconstruction project in Stockholm and the redevelopment and extension project ofthe Rocca al Mare shopping centre in Tallinn, Estonia were completed.- The Board of Directors proposes a per-share dividend of EUR 0.04 (EUR 0.04)and, additionally, a return of equity from invested unrestricted equity fund ofEUR 0.10 (EUR 0.10) per share.Summary of the Year 2009- Turnover increased by 4.5 per cent to EUR 186.3 million (2008: EUR 178.3million). This increase was due to the growth in gross leasable area and activedevelopment of the retail properties. Turnover growth was adversely impacted byslightly higher vacancy rates.- Profit/loss before taxes was EUR -37.5 million (EUR -162.3 million), includinga EUR -97.4 million (EUR -216.1 million) change in the fair value of investmentproperties.- Net rental income increased by 3.0 per cent to EUR 125.4 million (EUR 121.8million). If the impact of the weakened Swedish krona (SEK) is excluded, netrental income increased by 5.0 per cent.- Net rental income from like-for-like properties rose by 0.8 per cent.- The company's direct result increased to EUR 50.9 million (EUR 43.8 million).- Direct result per share (diluted) rose to EUR 0.23 (EUR 0.20).- Earnings per share were EUR -0.16 (EUR -0.56). Changes in the fair value ofinvestment properties have a substantial impact on earnings per share.- The occupancy rate was 95.0 per cent (96.0 %). The decrease in the occupancyrate resulted from a slight increase in the vacancy rate in Finland, Sweden andin the Baltic Countries.- Net cash from operating activities per share increased to EUR 0.30 (EUR0.21). This growth was mainly due to one-off exchange rate gains, lower interestexpenses, and positive changes in working capital as well as increased operatingprofit.- The equity ratio was 34.2 per cent (38.5 %). This decrease resulted mainlyfrom fair value changes in investment properties and higher debt due toinvestments.- The company's financial position remained good during the period. Totalavailable liquidity at the end of the reporting period was EUR 205.6 million,including unutilised committed debt facilities amounting to EUR 185.8 millionand EUR 19.8 million in cash. The available liquidity will cover the authorisedinvestments and scheduled debt interest and repayments at least until the end of2010, without any additional financing sources.- In June, an agreement was concluded on the sale of the apartments underconstruction in Liljeholmen, Sweden, totalling SEK 176 million (approximatelyEUR 16.3 million).- In July, Citycon agreed on the sale of the 181 apartments in ?ersbergaCentrum in Greater Stockholm area, Sweden, for approximately EUR 16.7 million.Concurrently, it was decided to redevelop the ?ersberga Centrum shoppingcentre. The estimated total investment amounts to EUR 46 million with Cityconaccounting for 75 per cent.CEO Petri Olkinuora's Comments on the Year 2009: Successful completion of two(re)development projects"The company's net cash from operating activities per share and direct resultper share were among the best in the company's history. Direct result increasedto EUR 50.9 million, thanks to growth in rental income and lower interest costs.Citycon's financial position is stable and we have sufficient committed,non-utilized credit facilities to finance the projects under construction.Over the year, the occupancy rate showed only a slight decrease and was 95 percent. Total sales of all of Citycon's shopping centres remained at almost theirprevious year's levels, although the retail environment continued todeteriorate.At the end of 2009, the largest development projects in the history of Cityconwere completed in Stockholm and in Tallinn where Liljeholmstorget and Rocca alMare were opened to the public very successfully. These completed projectsstrengthen the company's market position within the Swedish and the Estonianshopping centre business.Citycon continues to have several (re)development projects under planning in allof its operating countries. The company's investments mainly aim at improvingthe long-term competitiveness of its existing property portfolio. The extensionand redevelopment of the ?ersberga Centrum shopping centre in Sweden, thethorough redevelopment of the Espoontori shopping centre in Finland, and theconstruction of the new Helsinki Myllypuro shopping centre are some of thelatest projects. Significant development projects currently under planning inFinland include the extension of Iso Omena above the future metro station, a newshopping centre to be constructed in Vantaa Martinlaakso, and the redevelopmentof the shopping centre Forum in Jyv?yl?These projects are targeted to meetthe quality standards of the international LEED (Leadership in Energy andDesign) certification."Board Proposal for Dividend Distribution and Distribution of Assets from theInvested Unrestricted Equity FundThe parent company's retained earnings amount to EUR 27.5 million, of whichprofit for the period is EUR 18.5 million. On 31 December 2009, the funds in theparent company's invested unrestricted equity fund amounted to a total of EUR157.0 million.The Board of Directors proposes to the Annual General Meeting of 11 March 2010that a per-share dividend of EUR 0.04 be paid out for the financial year endingon 31 December 2009, and that EUR 0.10 per share be returned from the investedunrestricted equity fund. The Board of Directors proposes that the record datefor dividend payment and equity return be 16 March 2010 and that the dividendand equity return be paid on 7 April 2010.OutlookCitycon continues to focus on increasing its net cash from operating activitiesand direct operating profit. In order to implement this strategy, the companywill pursue value-added activities while cautiously monitoring the market forpotential acquisitions.Due to market changes and tight financing conditions, the initiation of plannedprojects will be carefully evaluated against stricter pre-leasing criteria.Citycon intends to continue the divestment of its non-core properties to improvethe property portfolio and strengthen the company's financial position. Thecompany is also considering alternative property financing sources.The grocery sales sector, which accounts for a substantial share of thecompany's lease portfolio, cushions the impact of rental cyclicality in thecompany's business. The company expects only moderate changes in net rentalincome, direct operating profit and direct result in 2010, since new(re)development projects will not be fully operational until towards the end of2010.Amsterdam, 9 February 2010Citycon OyjBoard of DirectorsThe entire report with tables as well as the company's Financial Statements2009 and the Corporate Governance Statement 2009 in pdf-format can be downloadedfrom the links below. They are also available on the corporate websitewww.citycon.com.Financial reports in 2010Citycon will publish its Annual Report 2009 on the corporate website in week9/2010 at the latest, and in print in week 10/2010 at the latest.Citycon will issue three interim reports during the financial year 2010 asfollows:January-March 2010, on Wednesday 21 April 2010, at approximately 9:00 a.m.January-June 2010, on Wednesday 14 July 2010, at approximately 9:00 a.m. andJanuary-September 2010, on Wednesday 13 October 2010, at approximately 9:00 a.m.Annual General MeetingCitycon Oyj will hold its Annual General Meeting at Finlandia Hall, HelsinkiAuditorium, Mannerheimintie 13e, Helsinki, Finland, on Thursday 11 March 2010,starting at 2:00 p.m.For more investor information, please visit the corporate website atwww.citycon.com.For further information, please contact:Petri Olkinuora, CEOTel +358 20 766 4401 or +358 400 333 256petri.olkinuora(at)citycon.fiEero Sihvonen, Executive Vice President and CFOTel +358 20 766 4459 or +358 50 557 9137eero.sihvonen(at)citycon.fiDistribution:NASDAQ OMX HelsinkiMajor mediawww.citycon.com[HUG#1382568] CG Statement 2009: http://hugin.info/3030/R/1382568/341462.pdf Financial Results 2009: http://hugin.info/3030/R/1382568/341458.pdf Financial Statements 2009: http://hugin.info/3030/R/1382568/341460.pdf
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