Citycon’s operational performance remained strong and in line with our expectations as total net rental income increased by 9.9% with comparable FX-rates and like-for-like net rental income by 5.9 % during the first half of the year. At the same time, we saw like-for-like sales growth of 2.6% compared to Q1-Q2/2023. It is notable that consumer spending across our centres has remained to be very robust reflecting the strength of our strategy to focus on everyday convenience with grocery and public service anchors. All our main retail segments continued to show strong sales growth.
Retail occupancy increased by 70 bps compared to Q2/2023, reaching 95.2% and reflecting the attractiveness of our locations. Collection rate remained high at 98% for Q1-Q2/2024 demonstrating again a full pass-through of indexations. Our tenants continue to benefit from increasing sales, and despite the higher rent levels, the occupancy cost ratio remains at a modest 9.4%. Strong operational performance is also supporting the development of the fair values of our properties. There were small upward yield revisions in a few of our prime assets, but these changes were more than offset by positive cash flow growth driven by rent indexations. We see a stabilization in the valuations in the market in general.
In the second quarter, we continued to take actions to strengthen our balance sheet. We extended our revolving credit facility and two term loans and executed an early redemption of our 2024 bond. These were important actions to improve our credit maturity profile and to secure a sufficient liquidity buffer for several years ahead. Most importantly, we successfully executed an exchange of our 2024 hybrid against a new hybrid and cash amount. This transaction underscores our commitment to maintaining an investment-grade credit rating and confirms Citycon’s access to capital markets.
During the quarter, we also completed the divestment of Kongssenteret at a price close to book value. Furthermore, we are currently working on multiple transactions with three signed LOIs of which two are in advanced negotiations and one in early stages. Further strengthening our balance sheet remains a key priority for us and we are committed to our EUR 350 million divestment target by the end of this year.
Henrica Ginström
Chief Executive Officer
Source: Citycon's Interim Report Q2/2024