Solid performance enhanced by low financing costs
Summary of the Third Quarter of 2009 Compared with the Previous
Quarter
- Turnover increased slightly to EUR 45.9 million (Q2/2009: EUR
45.6 million).
- Net rental income increased by 4.8 per cent to EUR 32.5 million
(EUR 31.0 million) mainly due to lower property operating expenses
than in the previous quarter, reflecting common seasonal variations.
- Net cash from operating activities per share was EUR 0.05 (EUR
0.09). The reduction was due to extraordinary items during the
previous quarter and timing differences.
- Earnings per share were EUR 0.06 (EUR -0.03).
- Direct result per share (diluted) was EUR 0.06 (EUR 0.06).
- The fair value change of investment properties was EUR -1.2 million
(EUR -26.0 million). The fair market value of investment properties
was EUR 2,162.7 million (EUR 2,104.5 million).
- The average net yield requirement for investment properties
remained at the previous quarter's level, at 6.6 per cent (6.6%) at
the end of the period, according to an external appraiser.
- Financial expenses totalled EUR 11.7 million (EUR 11.8 million).
- On the basis of Citycon's loan agreement covenants, Citycon's
interest cover ratio improved and was 2.2x (2.1x) and equity ratio
declined to 42.4 per cent (42.9%).
- Citycon agreed on the sale of 181 apartments in Åkersberga Centrum
in the Greater Stockholm area for a sale price of approximately EUR
16.7 million. Simultaneously, the company made a decision on the
redevelopment of the shopping centre. The estimated total investment
is EUR 46 million with Citycon accounting for 75 per cent.
Summary of January-September 2009 Compared with the Corresponding
Period of 2008
- Turnover increased by 3.2 per cent to EUR 137.4 million (Q1-3/2008:
EUR 133.1 million), due to growth in gross leasable area and
development of retail properties. Turnover growth was reduced by
slightly higher vacancy.
- Profit/loss before taxes was EUR -13.1 million (EUR -121.4
million), including a EUR -58.7 million (EUR -156.7 million) change
in the fair value of investment properties.
- Net rental income increased by 2.4 per cent to EUR 93.8 million
(EUR 91.6 million). If the impact of the weakened Swedish krona is
excluded, net rental income increased by 5.1 per cent.
- Net rental income from like-for-like properties rose by
0.5 per cent.
- The company's direct result was EUR 38.4 million
(EUR 31.9 million).
- Direct result per share (diluted) increased to EUR 0.17 (EUR 0.15).
- Earnings per share were EUR -0.05 (EUR -0.42). The fair value
changes in investment properties have a significant impact on
earnings per share.
- The occupancy rate was 94.7 per cent (95.6%). The decrease in
occupancy rate resulted from a slightly increased vacancy in Finland
and the Baltic countries.
- Net cash from operating activities per share remained strong and
increased to EUR 0.24 (EUR 0.14). The increase was due mainly to
non-recurring realised foreign exchange rate gains, positive change
in working capital, lower financing costs as well as higher operating
profit.
- The equity ratio was 35.9 per cent (40.3%). This decrease resulted
mainly from the fair value changes in the investment properties and
higher debt due to investments.
- The company's financial position remained good during the period.
Total liquidity at the end of the reporting period was
EUR 212.6 million, including unutilised committed debt facilities
amounting to EUR 193.2 million and EUR 19.4 million in cash. The
available liquidity will cover the authorised investments and
scheduled debt interest and repayments until at least the end of
2010, without the need for additional financing.
- In June, Citycon agreed to sell the apartments under construction
in Liljeholmen, Stockholm, for SEK 176 million (approx. EUR 16.3
million).
Key figures
Q3/ Q3/ Q2/ Q1-Q3/ Q1-Q3/ Change-%
2009 2008 2009 2009 2008 1) 2008
Turnover, EUR
million 45.9 44.6 45.6 137.4 133.1 3.2% 178.3
Net rental
income, EUR
million 32.5 31.5 31.0 93.8 91.6 2.4% 121.8
Operating
profit/loss, EUR
million 27.4 -44.1 1.1 22.7 -77.1 - -105.0
% of turnover 59.6% - 2.4% 16.5% - - -
Profit/loss
before taxes,
EUR million 15.6 -59.3 -10.7 -13.1 -121.4 -89.2% -162.3
Profit/loss
attributable to
parent company
shareholders,
EUR million 13.3 -46.0 -7.0 -10.5 -93.5 -88.8% -124.1
Direct operating
profit, EUR
million 28.6 27.6 27.1 81.4 79.7 2.1% 105.3
% of turnover 62.2% 61.9% 59.4% 59.2% 59.9% - 59.1%
Direct result,
EUR million 14.2 11.3 12.6 38.4 31.9 20.1% 43.8
Indirect result,
EUR million -0.9 -57.3 -19.5 -48.9 -125.4 -61.0% -167.9
Earnings per
share (basic),
EUR 0.06 -0.21 -0.03 -0.05 -0.42 -88.8% -0.56
Earnings per
share (diluted),
EUR 0.06 -0.21 -0.03 -0.05 -0.42 -88.8% -0.56
Direct result
per share
(diluted),
(diluted EPRA
EPS), EUR 0.06 0.05 0.06 0.17 0.15 18.4% 0.20
Net cash from
operating
activities per
share, EUR 0.05 0.02 0.09 0.24 0.14 70.3% 0.21
Fair value of
investment
properties, EUR
million 2) 2,104.5 2,162.7 2,184.8 -1.0% 2,111.6
Equity per
share, EUR 3.35 3.41 3.87 -11.9% 3.62
Net asset value
(EPRA NAV) per
share, EUR 3.58 3.64 4.16 -12.5% 3.88
EPRA NNNAV per
share, EUR 3.46 3.46 4.05 -14.7% 3.80
Equity ratio, % 36.2 35.9 40.3 - 38.5
Gearing, % 157.4 159.5 133.8 - 141.3
Net
interest-bearing
debt (fair
value), EUR
million 1,234.8 1,272.3 1,221.1 4.2% 1,194.6
Net rental
yield, % 6.0 6.1 5.6 - 5.8
Net rental
yield,
like-for-like
properties, % 6.5 6.6 5.8 - 6.1
Occupancy rate,
% 94.8 94.7 95.6 - 96.0
Personnel (at
the end of the
period) 114 117 112 4.5% 113
1) Change-% is calculated from exact figures and refers to the change
between 2009 and 2008.
2) Due to the adoption of amended IAS 40 Investment property
-standard, the fair value of investment properties also includes
development properties.
CEO Petri Olkinuora's Comments on January-September 2009:
"Citycon's cash flow, financial performance and financial position
remained good during the period. The direct result increased to EUR
38.4 million mainly due to higher net rental income and clearly lower
financial expenses. Also, net cash flow from operating activities
increased. Net rental income from like-for-like properties was
slightly higher than during the comparison period (0.5%), despite the
0.9 per cent fall in occupancy rate year-on-year. Aggregate sales in
our shopping centres were almost at the previous year's level despite
the general slowdown in retail sales.
During the period under review, Citycon decided to launch a
redevelopment project in the Åkersberga Centrum shopping centre in
the Greater Stockholm area. This project supports Citycon's growth
strategy and further strengthens its position in Sweden. The
pre-leasing of the project has been successful and the execution of
the project will benefit from lower building costs.
Citycon's two largest projects, the new Liljeholmstorget shopping
centre in Stockholm and the redevelopment of Rocca al Mare shopping
centre in Tallinn, have progressed as scheduled. The grand opening of
Liljeholmstorget will be on 22 October and the final phase of Rocca
al Mare will be completed and opened to the public in November. Both
shopping centres are almost fully leased and their completion will
strengthen Citycon's rental income and cash flow.
We continue to focus on investing in our existing portfolio to
improve the long-term competitiveness of our properties. New projects
in the pipeline include the developments of the Martinlaakso and
Myllypuro shopping centres in Helsinki Metropolitan Area. Citycon has
a planning reservation for Matinkylä metro station site on the
Länsimetro western metro line which provides the company with the
opportunity to extend Iso Omena shopping centre and to develop its
commercial concept."
Business Environment
The economic environment remained challenging during the third
quarter due to the global economic downturn. However, consumer
confidence has strengthened in Finland and Sweden. In Sweden, retail
sales saw an upward turn in the summer, and in Finland retail has
picked up a little from the figures in the spring. Meanwhile,
economic conditions continue to be harsh in the Baltic countries and
retail sales have fallen. (Sources: Statistics Finland, Statistics
Sweden, Statistics Estonia)
Grocery sales grew in Finland and Sweden, and even in Estonia grocery
sales decreased less than retail sales in general (The Finnish
Grocery Trade Association, Statistics Sweden, Statistics Estonia).
Affordable clothing sales grew in Finland and Sweden while furniture
and car sales were most adversely affected (Newsec Property Report,
Autumn 2009).
Inflation is negative and interest rate levels have, so far, reached
a record low in all of Citycon's operating countries (Statistics
Finland, Statistics Sweden, Statistics Estonia).
The volatility of the global financial markets continues to affect
the cost and availability of financing. Although availability has
improved from the first half of the year, loan margins continue to be
rather high. Citycon's long-term relationship with banks has been a
key factor in financing decisions.
Occupancy rates in shopping centres continue to be high both in
Finland and in Sweden. The steepest fall in occupancy rates was
experienced in large-format retail units that do not represent
Citycon's core business. (Jones Lang Lasalle, Nordic City Report,
Autumn 2009)
Although the property market has shown signs of recovery after a
quiet first half of the year, few deals have been closed. At the
moment, investors are primarily interested in prime properties that,
however, are not for sale (Jones Lang Lasalle).
Construction costs have decreased clearly, enhancing Citycon's
property development business.
Business and Property Portfolio Summary
Citycon is an active owner, operator and long-term developer of
shopping centres, laying the foundation for a successful retail
business. The company aims to increase its net yield over the long
term through active retail property management and redevelopment
efforts. Citycon's retail properties serve both consumers and
retailers.
Citycon is the market leader in the Finnish shopping centre business
and holds a strong position in Sweden and a firm foothold in the
Baltic countries. It assumes responsibility for the business
operations and administration of its investment properties.
Citycon continuously monitors its shopping centres for footfall and
tenant sales development in order to identify opportunities for
actively improving the occupancy rate. The company is involved in
the day-to-day operations of its shopping centres and, in
co-operation with its tenants, aims to increase the attractiveness,
footfall, sales and profits of its shopping centres on a continuous
basis.
Citycon is a pioneer in the Nordic shopping centre market, as it aims
to factor environmental considerations into its shopping centre
management as well as its redevelopment and development projects.
During the period under review, the Trio shopping centre in Lahti,
Finland, was awarded the first LEED® (Leadership in Energy and
Environmental Design) environmental certificate in the Nordic
countries. Trio's redevelopment project was one of Citycon's three
sustainable construction pilot projects.
Citycon operates in Finland, Sweden and the Baltic countries. In
compliance with its strategy, Citycon has been able to acquire
shopping centres in major growth centres in the countries in which it
operates. Citycon's investments are focused on areas with expected
population and purchasing power growth.
At the end of the period under review, Citycon owned 33 (33) shopping
centres and 51 (51) other properties. Of the shopping centres, 22
(22) were located in Finland, eight (8) in Sweden and three (3) in
the Baltic countries.
At the end of September, the market value of the company's property
portfolio totalled EUR 2,162.7 million (EUR 2,184.8 million) with
Finnish properties accounting for 67.0 per cent (70.2 %), Swedish
properties for 25.5 per cent (23.5 %) and Baltic properties for
7.5 per cent (6.3 %). The gross leasable area at the end of September
totalled 944,300 square metres.
Changes in the Fair Value of Investment Properties
Citycon measures its investment properties at fair value, under the
IAS 40 standard, according to which changes in the fair value of
investment properties are recognised through profit or loss.
Furthermore, due to the amendment to IAS 40 standard effective from 1
January 2009, Citycon also measures its development properties at
fair value instead of at cost and no longer presents development
properties separately from investment properties on its statement of
financial position. In accordance with the International Accounting
Standards (IAS) and the International Valuation Standards (IVS), an
external professional appraiser conducts a valuation of Citycon's
property portfolio on a property-by-property basis at least once a
year. However, in 2009, Citycon will have its properties valued by an
external appraiser on a quarterly basis, due to market volatility.
Citycon's property portfolio is valued by Realia Management Oy, part
of the Realia Group. Realia Management Oy is the preferred appraisal
service supplier of CB Richard Ellis in Finland. A summary of Realia
Management Oy's Property Valuation Statement at the end of September
2009 can be found at www.citycon.com/valuation. The valuation
statement includes a description of the valuation process and the
factors contributing to the valuation, as well as the results of the
valuation, and a sensitivity analysis.
During the period under review, the fair value of Citycon's property
portfolio decreased. This decrease was due to changes in the general
conditions in the property and financial market and to higher yield
requirements resulting from the general economic downturn. The period
saw a total value increase of EUR 10.7 million and a total value
decrease of EUR 69.5 million. The net effect of these changes on the
company's profit was EUR -58.7 million (EUR -156.7 million).
On 30 September 2009, the average net yield requirement defined by
Realia Management Oy for Citycon's property portfolio came to 6.6 per
cent (30 June 2009: 6.6% and 30 September 2008: 6.2 %).
Lease Portfolio and Occupancy Rate
At the end of the period under review, Citycon had a total of 4,033
(3,647) leases. The average remaining length of the lease agreements
was 3.0 (3.0) years. Citycon's property portfolio's net rental yield
was 6.1 per cent (5.6 %) and the economic occupancy rate was 94.7 per
cent (95.6 %). The decrease in occupancy rate was a result of a
slight increase in vacancy across the portfolio in all of Citycon's
operating countries, due to tighter market conditions.
Citycon's net rental income grew by 2.4 per cent to EUR 93.8 million
during the period under review. The leasable area rose by
1.7 per cent to 944,300 square metres. Net rental income from
like-for-like properties grew by 0.5 per cent, excluding the impact
of the weakened Swedish krona.
Like-for-like properties are properties held by Citycon throughout
the 24-month reference period, excluding properties under
refurbishment and redevelopment as well as undeveloped lots. 78.1 per
cent of like-for-like properties are located in Finland. The
calculation method for net yield and standing (like-for-like)
investments is based on guidelines issued by the KTI Institute for
Real Estate Economics and the Investment Property Databank (IPD).
During the last 12 months, the rolling twelve-month occupancy cost
ratio for like-for-like properties was 8.9 per cent. The occupancy
cost ratio is calculated in terms of net rent and potential service
charges paid by a tenant to Citycon, as a share of the tenant's
sales, excluding VAT. The VAT percentage is an estimate.
Lease Portfolio Summary
Q3/ Q3/ Q2/ Q1-Q3/ Q1-Q3/
2009 2008 2009 2009 2008 Change-% 2008
Number of leases
started during
the period 140 81 219 487 317 53.6 572
Total area of
leases started,
sq.m. 23,789 12,810 32,511 72,366 55,230 31.0 124,960
Occupancy rate at
end of the
period, % 94.8 94.7 95.6 -0.9 96.0
Average remaining
length of lease
portfolio at the
end of the
period, year 3.0 3.0 3.0 0.0 3.1 1)
1) Interpretation of the remaining length of a lease agreement has
been revised.
Acquisitions and Divestments
Citycon continues to focus on the development and redevelopment of
the company's shopping centres, and follows developments in the
shopping centre market across its operating regions. No new shopping
centres were acquired during the period.
In July, Citycon agreed on the sale of 181 apartments in Åkersberga
Centrum for a sale price of SEK 181 million (approx. EUR 16.7
million). The transaction is expected to be concluded during the
fourth quarter, and will not generate any gain on sale.
In June, Citycon agreed to sell the 72 apartments under construction
in connection with the Liljeholmstorget shopping centre located in
Stockholm, for approximately SEK 176 million (approximately EUR 16.3
million). The gain on sale is estimated to be around SEK 30 million
(around EUR 2.8 million) depending on the final construction
expenditure. Gain on sale will be recognised under fair value changes
in the statement of comprehensive income along with the progress of
the apartments' construction.
At the end of January, Citycon divested all the shares in its
subsidiary MREC Kiinteistö Oy Keijutie 15. The debt-free selling
price of this non-core property in Lahti amounted to approximately
EUR 3 million and the company booked a gain on sale of EUR 0.1
million. As part of its strategy, Citycon aims to continue the
disposal of non-core properties.
Development Projects
Citycon is pursuing a long-term increase in the footfall and cash
flow, as well as in the efficiency and return of its retail
properties. The purpose of the company's development activities is to
keep its shopping centres competitive for both customers and tenants.
In the short term, redevelopment projects may weaken returns from
some properties, as some retail premises may have to be temporarily
vacated for refurbishment, which affects rental income. Citycon aims
to carry out any redevelopment projects phase by phase so that the
whole shopping centre does not have to be closed during the works in
question, thus ensuring continuous cash flow.
During the period under review, Citycon had three major development
and redevelopment projects in progress: Rocca al Mare in Tallinn,
Liljeholmstorget in Stockholm and most recently, the redevelopment
and extension project of Åkersberga Centrum shopping centre in
Greater Stockholm Area. In Finland, redevelopment plans for the
Martinlaakso and Myllypuro shopping centres are currently on the
pipeline. In addition, together with NCC, Citycon was granted a
reservation for land use involving a metro station for the Länsimetro
western metro line, to be constructed adjacent to the Iso Omena
shopping centre. The completion of the western metro line connecting
Helsinki and Espoo is scheduled for 2014.
(Re)development Projects in Progress
The table below lists the most significant development and
redevelopment projects in progress, as approved by the Board of
Directors. More information on planned projects can be found on the
corporate website at ww.citycon.com and in the Annual Report 2008.
Capital expenditure during the course of 2009 on all development
projects amounted to EUR 9.0 million in Finland, EUR 62.4 million in
Sweden and EUR 12.2 million in the Baltic countries.
30.9.2009 (Re)development Projects in Progress, 30 September 2009 1)
Actual gross
expenditure
Estimated by 30 Sept. Estimated
total cost 2009 final year
(EUR (EUR of
Location million) million) completion
Stockholm,
Liljeholmstorget Sweden 130 2) 121.5 2009
Tallinn,
Rocca al Mare Estonia 58.3 48.2 2009
Österåker,
Åkersberga Centrum Sweden 45.6 9.8 2011
Seinäjoki,
Torikeskus Finland 4 2.7 2009
1) Calculated based on period end exchange rates.
2) Excluding the residential units to be sold.
The company's largest development project, which is also its main
sustainable construction project, involves the construction of a new
shopping centre in Liljeholmen, Stockholm. This project has advanced
within the planned budget and schedule. Among others, the shopping
centre's anchor tenants include the ICA-Kvantum grocery retailer,
Hennes & Mauritz, MQ-fashion chain and Systembolaget. The new
shopping centre will be opened in October 2009 and its premises are
almost fully leased.
The second stage of the redevelopment project of the Rocca al Mare
shopping centre in Tallinn was completed in May 2009, and the fully
redeveloped shopping centre is scheduled to open in November. Rocca
al Mare is the largest shopping centre in Estonia and has
considerably attraction not only in the Tallinn area but also for
shopping tourists. Its success is driven by Estonia's lower prices,
which undercut Finland's by as much as a third, for instance.
Citycon's Board of Directors has also approved a redevelopment
project involving the Torikeskus in Seinäjoki. No other projects had
been approved by the company's Board of Directors by the end of the
period under review, and new development projects will be started
only once financing and lease agreements have been adequately
secured.
Business Units
Citycon's business operations are divided into three business units:
Finland, Sweden and the Baltic Countries. These are sub-divided into
two business areas: Retail Properties and Property Development. The
Finnish business unit also includes a Commercial Development
function, responsible for the commercial development of Citycon's
Finnish shopping centres and the development of new commercial
concepts.
Finland
Citycon is the market leader in the Finnish shopping centre business.
Citycon's market share was 24 per cent of the Finnish shopping centre
market last year (source: Entrecon). The company's net rental income
from Finnish operations during the period under review was EUR 69.4
million (EUR 68.2 million). The business unit accounted for
73.9 per cent of Citycon's total net rental income.
The key figures for the Finnish property portfolio are presented
below. Ongoing development projects have been covered previously in
this document.
Lease Portfolio Summary, Finland
Q3/ Q3/ Q2/ Q1-Q3/ Q1-Q3/
2009 2008 2009 2009 2008 Change-% 2008
Number of leases
started during the
period 65 66 80 211 259 -18.5 452
Total area of
leases started,
sq.m. 20,530 11,090 9,080 38,800 47,200 -17.8 79,130
Occupancy rate at
end of the period,
% 94.5 94.1 95.7 -1.7 95.7
Average remaining
length of lease
portfolio at the
end of the period,
year 2.9 2.9 3.1 -6.5 3.1
Financial Performance, Finland
Q3/ Q3/ Q2/ Q1-Q3/ Q1-Q3/
2009 2008 2009 2009 2008 Change-% 2008
Gross rental
income, EUR
million 31.3 30.8 31.4 95.0 91.7 3.7 122.5
Turnover, EUR
million 32.4 31.9 32.6 98.5 94.8 3.9 126.8
Net rental
income, EUR
million 23.4 23.4 22.9 69.4 68.2 1.6 90.9
Net fair value
losses/gains on
investment
property, EUR
million -4.6 -45.0 -20.5 -50.6 -105.6 -52.1 -154.3
Operating
profit/loss, EUR
million 17.4 -22.9 1.0 14.4 -41.2 - -62.9
Capital
expenditure, EUR
million 2.8 18.2 3.2 9.2 59.2 -84.5 69.2
Fair value of
investment
properties, EUR
million (1 1,451.6 1,449.7 1,532.9 -5.4 1,494.0
Net rental yield,
% (2 6.3 6.4 5.8 - 6.0
Net rental yield,
like-for-like
properties, % 6.5 6.6 5.9 - 6.1
1) Due to the adoption of amended IAS 40 Investment property
-standard, the fair value of investment properties also includes
development properties.
2) Includes the lots for development projects.
Sweden
Citycon has strengthened its position in the Swedish shopping centre
market and owns eight shopping centres and seven other retail
properties in Sweden, located in the Greater Stockholm and Greater
Gothenburg areas and in Umeå. The company's net rental income from
Swedish operations decreased by 8.5 per cent and totalled EUR 17.2
million (EUR 18.8 million). If the impact of the weakened Swedish
krona is excluded, net rental income increased by 4.2 per cent from
the previous year. The business unit accounted for 18.3 per cent of
Citycon's total net rental income.
The key figures for the Swedish property portfolio are presented
below. Ongoing development projects have been covered previously in
this document.
Lease Portfolio Summary, Sweden
Q3/ Q3/ Q2/ Q1-Q3/ Q1-Q3/
2009 2008 2009 2009 2008 Change-% 2008
Number of leases
started during the
period 71 13 72 204 39 423.1 58
Total area of leases
started, sq.m. 2,995 1,670 7,320 17,188 6,280 173.7 15,340
Occupancy rate at end
of the period, % 94.4 95.0 94.8 0.2 96.0
Average remaining
length of lease
portfolio at the end
of the period, year 2.4 2.2 2.4 -8.3 2.4
Financial Performance, Sweden
Q3/ Q3/ Q2/ Q1-Q3/ Q1-Q3/
2009 2008 2009 2009 2008 Change-% 2008
Gross rental income,
EUR million 9.6 11.3 9.2 27.8 31.3 -11.0 41.1
Turnover, EUR million 9.9 10.5 9.5 28.7 31.8 -9.8 41.9
Net rental income, EUR
million 6.4 6.5 5.6 17.2 18.8 -8.5 24.1
Net fair value
losses/gains on
investment property,
EUR million -1.3 -29.3 -4.7 -2.6 -48.7 -94.7 -70.1
Operating profit/loss,
EUR million 4.4 -23.3 0.1 12.3 -32.2 - -49.1
Capital expenditure,
EUR million 29.1 18.9 18.9 62.4 43.9 42.3 65.6
Fair value of
investment properties,
EUR million (1 496.8 551.0 513.3 7.4 462.4
Net rental yield, % (2 4.9 4.8 4.7 - 5.0
Net rental yield,
like-for-like
properties, % 6.1 6.4 5.4 - 5.6
1) Due to the adoption of amended IAS 40 Investment property
-standard, the fair value of investment properties also includes
development properties.
2) Includes the lots for development projects.
Baltic Countries
At the end of the period under review, Citycon owned three shopping
centres in the Baltic countries: Rocca al Mare and Magistral in
Tallinn, Estonia, and Mandarinas in Vilnius, Lithuania. The
deteriorating economic situation in the Baltic countries has affected
the sales and footfall of Citycon's shopping centres and increased
tenants' requests for rent reductions. This has also increased the
credit loss risk. Vacancy has not, however, increased markedly in the
Baltic countries during the period. Net rental income from Baltic
operations amounted to EUR 7.3 million (EUR 4.6 million). The
business unit accounted for 7.8 per cent of Citycon's total net
rental income.
The key figures for the Baltic property portfolio are presented
below. Ongoing development projects have been covered previously in
this document.
Lease Portfolio Summary, Baltic Countries
Q3/ Q3/ Q2/ Q1-Q3/ Q1-Q3/
2009 2008 2009 2009 2008 Change-% 2008
Number of leases
started during the
period 4 2 67 72 19 278.9 62
Total area of leases
started, sq.m. 264 50 16,111 16,378 1,750 835.9 30,490
Occupancy rate at end
of the period, % 99.9 99.7 99.8 -0.1 99.8
Average remaining
length of lease
portfolio at the end
of the period, year 5.6 5.4 2.2 145.5 5.4 1)
1) Interpretation of the remaining length of a lease agreement has
been revised.
Financial Performance, Baltic Countries
Q3/ Q3/ Q2/ Q1-Q3/ Q1-Q3/
2009 2008 2009 2009 2008 Change-% 2008
Gross rental income, EUR
million 3.4 2.1 3.3 9.7 6.3 54.8 9.3
Turnover, EUR million 3.6 2.1 3.5 10.2 6.5 57.3 9.6
Net rental income, EUR
million 2.7 1.5 2.5 7.3 4.6 58.9 6.8
Net fair value
gains/losses on
investment property, EUR
million 4.7 2.6 -0.7 -5.6 -2.4 133.0 8.3
Operating profit/loss,
EUR million 7.2 4.0 1.5 1.1 1.8 -40.3 14.4
Capital expenditure, EUR
million 1.2 4.0 5.7 12.2 16.7 -26.6 22.7
Fair value of investment
properties, EUR million
(1 156.1 162.0 138.6 16.9 155.3
Net rental yield, % (2 6.4 6.7 5.8 - 6.2
Net rental yield,
like-for-like
properties, % 7.8 8.1 7.2 - 7.4
1) Due to the adoption of amended IAS 40 Investment property
-standard, the fair value of investment properties also includes
development properties.
2) Includes the lots for development projects.
Turnover and Profit
Turnover for the period came to EUR 137.4 million (EUR 133.1
million), principally derived from the rental income generated by
Citycon's retail premises. Gross rental income accounted for 96.5 per
cent (97.1%) of turnover.
Operating profit came to EUR 22.7 million (EUR -77.1 million). Profit
before taxes was EUR -13.1 million (EUR -121.4 million) and profit
after taxes attributable to the parent company's shareholders EUR
-10.5 million (EUR -93.5 million). The increase in operating profit
was mainly due to the fair value change of the property portfolio. As
a result of the completed redevelopment projects, the operating
profit rose also due to net rental income generated by increased and
refurbished premises. Credit losses continued to be minor, at EUR 0.1
million. In addition to this, a credit loss provision of EUR 0.2
million was recognized under the statement of comprehensive income.
The effect of changes in the fair value of the property portfolio, of
gains on sales and of other indirect items on the profit attributable
to parent company shareholders, was EUR -48.9 million (EUR -125.4
million), tax effects included. Taking this into account, the direct
result after taxes was EUR 6.4 million above the reference period
level (cf. Note "Reconciliation between direct and indirect result").
The increased direct result was mainly attributed to the increased
net rental income, as well as exchange rate changes and decreased
interest rates resulting in lower financial expenses. In addition, a
gain of EUR 0.4 million, including tax effects, for the buybacks of
convertible bonds was recognised under the direct result.
Current taxes on the direct result were higher during the reporting
period than during the reference period, due to growth in the direct
result and the buybacks of convertible bonds.
Earnings per share were EUR -0.05 (EUR -0.42). Direct result per
share, diluted, (diluted EPRA EPS), was EUR 0.17 (EUR 0.15). Net cash
flow from operating activities per share amounted to EUR 0.24 (EUR
0.14).
Human Resources and Administrative Expenses
At the end of the period, Citycon Group employed a total of 117 (112)
persons, of whom 76 were employed in Finland, 33 in Sweden and eight
in the Baltic countries. Administrative expenses remained almost
unchanged at EUR 12.4 million (EUR 12.3 million), including
EUR 0.2 million (EUR 0.3 million) in calculated non-cash expenses
related to employee stock options and the company's share-based
incentive scheme.
Capital Expenditure and Divestments
Citycon's reported gross capital expenditure during the reporting
period totalled EUR 84.1 million (EUR 120.4 million). Of this,
property acquisitions accounted for EUR 0.0 million
(EUR 11.1 million), property development EUR 83.7 million
(EUR 108.5 million) and other investments EUR 0.5 million
(EUR 0.8 million). These investments were financed through cash flow
from operations and existing financing arrangements.
In July, Citycon agreed on the sale of 181 apartments in Åkersberga
Centrum for a sale price of SEK 181 million (approx. EUR 16.7
million). In June, Citycon agreed to sell the apartments under
construction in connection with the Liljeholmstorget shopping centre
located in Stockholm for approximately SEK 176 million (approximately
EUR 16.3 million). At the end of January, Citycon divested itself of
all shares in its subsidiary MREC Kiinteistö Oy Keijutie 15. The
debt-free selling price of this non-core property in Lahti amounted
to approximately EUR 3 million.
Statement of Financial Position and Financing
The total assets at the end of the reporting period stood at
EUR 2,207.4 million (EUR 2,238.3 million). Liabilities totalled
EUR 1,416.1 million (EUR 1,337.4 million), with short-term
liabilities accounting for EUR 155.6 million (EUR 158.6 million). The
Group's financial position remained good. At the end of the period
under review, Citycon's liquidity was EUR 212.6 million, of which EUR
193.2 million consisted of undrawn, committed credit facilities and
EUR 19.4 million of cash and cash equivalents. At the end of the
period, Citycon's liquidity, short-term credit limits and commercial
papers excluded, stood at EUR 196.1 million (30 June 2009: EUR 222.5
million).
For the purpose of short-term liquidity management, the company uses
a EUR 100 million non-committed Finnish commercial paper programme
and a non-committed Swedish commercial paper programme worth SEK one
billion. The Finnish commercial paper markets perked up in the third
quarter, and by the end of the period Citycon had issued commercial
papers to the value of EUR 16.5 million. Citycon's financing is
mainly arranged on a long-term basis, with short-term
interest-bearing debt constituting approximately eight per cent of
the Group's total interest-bearing debt at the end of the report
period.
From the reference period, interest-bearing debt increased by EUR
57.1 million, to EUR 1,281.3 million (EUR 1,224.2 million). The fair
value of the Group's interest-bearing debt stood at EUR 1,291.6
million (EUR 1,239.8 million).
The Group's cash and cash equivalents totalled EUR 19.4 million
(EUR 18.7 million). The fair value of the Group's interest-bearing
net debt stood at EUR 1.272,3 million (EUR 1,221.1 million).
The year-to-date weighted average interest rate decreased compared to
the previous year and was 4.24 per cent (4.92% during reference
period). The average loan maturity, weighted according to the
principal amount of the loans, stood at 3.9 years (4.7 years). The
average interest-rate fixing period was 3.2 years (3.5 years).
Citycon's interest cover ratio improved due to lower interest costs
and came to 2.2 (Q2/2009: 2.1). The company's equity ratio as defined
in the covenant's of the loan agreements decreased due to investments
which were financed using debt financing, and was 42.4 per cent
(Q2/2009: 42.9%).
The weighted average interest rate, interest-rate swaps included,
decreased and was 3.93 per cent on 30 September 2009.
At the end of the period the Group's equity ratio was 35.9 per cent
(40.3%). Gearing stood at 159.5 per cent (133.8%).
Of Citycon's interest-bearing debt at the end of the period under
review, 77.5 per cent (74.1%) was in floating-rate loans, of which
71.4 per cent (67.3 %) had been converted into fixed-rate loans by
means of interest-rate swaps. Fixed-rate debt accounted for
77.8 per cent (75.8 %) of the Group's year-end interest-bearing debt,
interest-rate swaps included. The loan portfolio's hedging ratio is
in line with the Group's financing policy. During the third quarter
of 2009, Citycon took advantage of the current low interest rates and
rolled forward maturing interest rate swaps, entering into new hedges
which slightly increased the hedge ratio.
Citycon applies hedge accounting, whereby changes in the fair value
of interest-rate swaps subject to hedge accounting are recognised
under other comprehensive income. The period-end nominal amount of
interest-rate swaps totalled EUR 774.8 million (EUR 669.7 million),
with hedge accounting applied to interest-rate swaps whose nominal
amount totalled EUR 750.4 million (EUR 593.3 million).
On 30 September 2009, the nominal amount of all of the Group's
derivative contracts totalled EUR 777.9 million (EUR 826.8 million),
and their fair value was EUR -30.2 million (EUR 16.1 million). The
decline of market interest rates during 2009 decreased the fair value
of Citycon's interest rate derivatives. Hedge accounting is applied
for the majority of interest rate derivatives, meaning that any
changes in their fair value will be recognised under other
comprehensive income. Thereby, the fair value loss for these
derivatives does not affect the profit for the period or earnings per
share but the total comprehensive income. On 30 September 2009, the
fair value loss recognised under other comprehensive income, taking
into account the tax effect, totalled EUR -5.8 million (EUR 0.1
million).
Net financial expenses totalled EUR 35.8 million (EUR 44.2 million).
The decrease in financial expenses during 2009 is mainly attributable
to lower interest rates and the buybacks of convertible bonds.
Net financial expenses in the statement of comprehensive income
include a one-off gain of EUR 0.6 million for the buybacks of the
convertible bonds. In addition, net financial expenses in the
statement of comprehensive income include EUR 1.1 million
(EUR 1.4 million) in non-cash expenses related to the option
component on convertible bonds.
Loan Market Transactions
In March, Citycon signed an agreement for a EUR 75 million unsecured
revolving credit facility with a group of three Nordic banks. The
agreement is valid for three years.
The new syndicated loan will further strengthen the company's
available liquidity and provide the means to finance Citycon's growth
on a committed basis. Proceeds from the credit facility will be used
to finance strategic investments such as shopping centre
redevelopment projects. The credit margins of the loan are subject to
a pricing grid based on Citycon's interest cover ratio covenant, as
has been the case with the company's previous loan agreements.
Buybacks of Subordinated Convertible Capital Bonds Issued in 2006
In July 2006, Citycon's Board of Directors decided to issue 2,200
subordinated capital convertible bonds with a face value of EUR
50,000 each, totalling EUR 110 million, directed at international
institutional investors. The issue of these convertible bonds,
waiving the shareholders' pre-emptive subscription rights, was based
on the authorisation given at Citycon's Annual General Meeting on
14 March 2006. These convertible bonds have been listed on the NASDAQ
OMX Helsinki exchange since 22 August 2006. The maturity of the bonds
is 7 years and they will yield a coupon of 4.5 per cent annually, in
arrears. The conversion period runs from 12 September 2006 to 27 July
2013 and the maturity date is 2 August 2013. The current conversion
price is EUR 4.20.
In the autumn of 2008, Citycon began to repurchase its convertible
bonds, since the market situation enabled the company to do so at a
price clearly below their face value and the repurchases enabled the
company to strengthen its statement of financial position and
decrease its net financial expenses. In November-December 2008,
Citycon repurchased a total of 542 bonds, each with a face value of
EUR 50,000, which the company's Board of Directors decided to cancel
on 9 December 2008 and 11 February 2009, in accordance with the terms
and conditions of the convertible bonds.
Citycon continued these buybacks of convertible bonds during the
period under review by repurchasing a total of 128 bonds for EUR 3.6
million (including interest accrued), on 27 February 2009 and 10
March 2009. The repurchased bonds were cancelled on 18 March 2009.
After this cancellation, the outstanding number of convertible bonds
is 1,530 and the maximum number of shares to be subscribed for with
the bonds is 18,214,285. As a result of the cancellation, the maximum
increase in Citycon's share capital on the basis of the convertible
bonds decreased from EUR 26,646,428.25 to EUR 24,589,284.75. The
amendments to Citycon's convertible bonds were registered in the
Trade Register on 2 April 2009.
By the end of September, Citycon had repurchased a total principal
amount of EUR 33.5 million of the 2006 convertible bonds,
corresponding to approximately 30.5 per cent of the aggregate amount
of convertible bonds. The weighted average repurchase price was 53.5
per cent of the face value of the bonds.
Short-term Risks and Uncertainties
For risk management purposes, Citycon has a holistic Enterprise Risk
Management (ERM) programme in place. Citycon's risk management aims
to ensure that the company can meet its strategic and operational
goals, while the ERM's purpose is to generate up-to-date and
consistent information for the company's senior executives and Board
of Directors on any risks threatening the targets set in strategic
and annual plans.
Citycon's Board of Directors estimates that major short-term risks
and uncertainties are associated with economic developments in the
company's operating regions, the availability of financing as well as
changes in the fair value of investment properties and interest
rates. Redevelopment and construction of the company's own properties
means that the risks associated with project management and the
leasing of new premises will also increase.
A number of factors contribute to the value of retail properties,
such as general and local economic development, investment demand and
interest rates. At present, investment property values are subject to
abnormally high uncertainty due to the global financial crisis and
the dramatically weaker economic outlook in the company's operating
regions.
As a result of the credit crisis, property prices have fallen, and
Citycon has also recorded fair value losses for the period under
review from the lower values of investment properties. During the
period under review, trading activity on the property markets has
been slow. Furthermore, weakening economic conditions make the future
development of properties' fair value even more uncertain. While
changes in the investment properties' fair value have an effect on
the company's profit for the period, they do not have an immediate
impact on cash flow.
Economic fluctuations and developments materially affect demand for
rental premises and rental rates. These represent one of the
company's key short-term risks. All of the company's operating
regions experienced a marked slow-down in economic growth compared
with the same period last year. Several economists forecast markedly
negative economic growth for all of the company's operating regions
for the rest of the year. If these economic conditions continue for a
prolonged period, they will reduce demand for retail premises, weaken
tenants' ability to pay rent, intensify tenants' requests for rent
reductions, and increase the vacancy rate in the company's
properties, all of which may have a negative impact on the company's
business and financial performance.
Citycon's growth relies on the refurbishment and redevelopment of
retail properties. Implementation of this strategy requires both
equity and debt financing. Difficulties in the banking sector have
made banks more reluctant to lend money to enterprises. Furthermore,
due to falling share prices and investors' reluctance to invest in
shares, it is more difficult for listed companies to acquire equity
through share issues. However, Citycon's financial position is good,
enabling it to finance its ongoing projects in full as planned. The
company will need new financing for future new investments and growth
efforts, and the terms of such arrangements will naturally be
affected by the financial situation at that time.
In addition to the availability of financing, Citycon's main
financial risk is the interest-rate risk of the company's loan
portfolio. During the period under review, the six-month interest
rate in the euro area fell by 1.96 percentage points, while in Sweden
the equivalent interest rate dropped 1.71 percentage points. During
this period, Citycon's average interest rate decreased by
0.68 percentage points, due to the clear decline in market rates.
The short-term risks involved in (re)development projects are
associated with the leasing of new premises and the implementation of
construction projects. Leasing risks in projects are minimised by
securing the allocation of sufficient resources to the leasing
operations of new properties, investing in the marketing of new
shopping centres and concluding agreements with anchor tenants prior
to a project's commencement or during its initial stages. Project
implementation risks are managed through the deployment of sufficient
resources. Responsibility for projects is borne by experienced
in-house project managers.
More details on the company's risk management are available on the
company's website at www.citycon.com/riskmanagement and on pages
32-34 of the Financial Statements 2008.
Environmental Responsibility
Citycon seeks to lead the way in responsible shopping centre business
and to promote sustainable development within the business. The
location of Citycon's shopping centres in city centres, local centres
or generally adjacent to major traffic flows, combined with excellent
public transport connections, makes them well positioned to face the
demands of sustainable development.
Citycon has initiated a Green Shopping Centre Management programme to
foster sustainable development in all shopping centres owned by the
company. The programme, to be implemented in 2009, aims to promote
energy efficiency, recycling and other operations that support
sustainable development.
At the end of June, the Trio shopping centre was awarded the first
LEED® (Leadership in Energy and Environmental Design) environmental
certificate in the Nordic countries. Located in Lahti, Finland, Trio
is one of Citycon's three pilot projects in sustainable construction.
The other LEED projects include the redevelopment and extension of
the Rocca al Mare shopping centre in Tallinn, and the construction of
the Liljeholmstorget shopping centre in Stockholm. Citycon will also
seek LEED certification for these projects once they are completed.
Certification forms an essential element of Citycon's efforts toward
sustainable development.
LEED is an internationally recognised and the most widely spread
rating system for green buildings. In the certification process, a
construction project is assessed against six criteria: Sustainable
Sites, Water Efficiency, Energy and Atmosphere, Materials and
Resources, Indoor Environmental Quality and Innovation in Design. The
assessment is conducted by an independent third party, the Green
Building Certification Institute, functioning under the U.S. Green
Building Council.
Annual General Meeting 2009
Citycon Oyj's Annual General Meeting (AGM) took place in Helsinki,
Finland, in March. The AGM adopted the company's financial statements
for the financial year 2008 and discharged the members of the Board
of Directors and the Chief Executive Officer from liability. The AGM
decided on a dividend of EUR 0.04 per share for the financial year
2008 and, in addition, on an equity return of EUR 0.10 per share from
the invested unrestricted equity fund. The dividend and equity return
were paid on 3 April 2009. Other decisions made at the Annual General
Meeting have been reported in the previous interim report, published
on 23 April 2009.
Shareholders, Share Capital and Shares
Trading and Share Performance
During January-September, the number of Citycon shares traded on the
NASDAQ OMX Helsinki totalled 126.1 million (114.1 million) at a total
value of EUR 227.4 million (EUR 380.2 million). The highest quotation
during the period was EUR 2.97 (EUR 4.28) and the lowest EUR 1.30
(EUR 2.25). The reported trade-weighted average price was EUR 1.81
(EUR 3.33), and the share closed at EUR 2.90 (EUR 2.30). The
company's market capitalisation at the end of September totalled
EUR 641.1 million (EUR 508.3 million).
Shareholders
At the end of September, Citycon had a total of 3,692 (2,001)
registered shareholders, of whom 11 were account managers of
nominee-registered shares. Nominee-registered and other international
shareholders held 200.7 (211.7 million) shares, or 90.8 per cent
(95.8%) of shares and voting rights in the company.
Notifications of Changes in Shareholdings
Perennial Investment Partners Limited notified the company in March
that its holdings in Citycon Oyj had fallen below the five per cent
threshold. According to the notification, Perennial Investment
Partners Limited held a total of 7,770,418 Citycon shares on 12 March
2009, equivalent to 3.52 per cent of the company's shares and voting
rights.
AXA Investment Managers Paris notified the company in August that AXA
S.A.'s holdings in Citycon Oyj had exceeded the five percent
threshold. According to the notification, AXA S.A. and its
subsidiaries held a total of 11,105,522 Citycon shares on 7 August
2009, equivalent to 5.02 per cent of the company's shares and voting
rights.
Share capital
At the end of September 2009, the company's registered share capital
totalled EUR 259,570,510.20 and the number of shares 221,059,735.
During the period, there were no changes in the company's share
capital but the number of shares grew by 60,746, which the company
issued through directed, free share issues in May as part of its
long-term, share-based incentive plan. The company has a single
series of shares, with each share entitling to one vote at general
meetings of shareholders. The shares have no nominal value.
Board Authorisations
The AGM for 2007 authorised the Board of Directors to decide on
issuing new shares and disposing of treasury shares through paid or
free share issues. New shares can be issued and treasury shares can
be transferred to shareholders in proportion to their existing
shareholding or through a directed share issue waiving the
pre-emptive rights of shareholders, if a weighty financial reason
exists for doing so. The Board can also decide on a free share issue
to the company itself. In addition, the Board was authorised to grant
the special rights referred to in Section 1 of Chapter 10 of the
Finnish Limited Liability Companies Act, entitling their holders to
receive, against payment, new shares in the company or treasury
shares. The combined number of new shares to be issued and treasury
shares to be transferred, including shares granted on the basis of
the special rights, may not exceed 100 million. At the end of
September, the number of shares that can be issued or disposed of on
the basis of the authorisation totalled 72,317,432. This
authorisation is valid until 13 March 2012.
The AGM for 2009 authorised the Board of Directors to decide on the
acquisition of 20 million of the company's own shares. The
acquisition authorisation will be valid until the next Annual General
Meeting. The company had no treasury shares at the end of the period.
At the end of the period under review, the Board had no other
authorisations.
Stock Options 2004
The Annual General Meeting held on 15 March 2004 authorised the issue
of a maximum of 3,900,000 stock options to the personnel of the
Citycon Group. These stock options are listed on the NASDAQ OMX
Helsinki exchange.
The subscription period for Citycon's stock options 2004 A expired at
the end of March. A total of 386,448 shares were subscribed with
these options. The number of unexercised stock options 2004 A
totalled 694,925. These stock options have been deleted as worthless
from their holders' book-entry accounts.
The table below includes information on the number of stock options
2004 and their subscription ratios and subscription prices. The full
terms and conditions of the stock option plan are available on the
company's website at www.citycon.com/options. No shares were
subscribed based on the stock options 2004 during the period under
review.
Basic Information on Stock Options 2004 as at 30 September 2009
2004 B 2004 C
No. of options granted 1,090,000 1,050,000
No. held by Veniamo-Invest Oy ¹) 210,000 250,000
Subscription ratio, option/shares 1:1.2127 1:1.2127
Subscription price per share, EUR ²) 2.5908 4.2913
Subscription period began 1.9.2007 1.9.2008
Share subscription period ends 31.3.2010 31.3.2011
No. of options exercised - -
No. of shares subscribed with options - -
No. of options available for share subscription 1,090,000 1,050,000
No. of shares that can be subscribed 1,321,843 1,273,335
¹) Veniamo-Invest Oy, a wholly-owned subsidiary of Citycon Oyj,
cannot subscribe for its parent company's shares.
²) Following the dividend payment and equity return in 2009. The
share subscription prices are reduced by half of the per-share
dividends paid and per-share equity returned. However, the share
subscription price is always at least EUR 1.35.
Outlook
Citycon continues to focus on increasing its cash flow and operating
profit (excluding fair value changes). In order to implement this
strategy, the company will focus on value-added activities while
cautiously monitoring the market for potential acquisitions.
Due to market changes and tight financing conditions, the launch of
planned projects will be re-evaluated. Citycon intends to continue
the divestment of its non-core properties to improve the property
portfolio and strengthen the company's financial position. The
company is also considering alternative property financing sources.
The grocery sales sector, which accounts for a substantial share of
the company's lease portfolio, cushions the impact of rental
cyclicality in the company's business. The company expects its
full-year direct result and net cash from operating activities to
increase and net rental income to remain stable as a result of
redevelopment projects coming online, active shopping centre
management as well as lower interest rates.
Helsinki, 14 October 2009
Citycon Oyj
Board of Directors
UNAUDITED INTERIM CONDENSED FINANCIAL STATEMENTS
1 January - 30 September 2009
Condensed Consolidated Statement of Comprehensive Income, IFRS
Q3/ Q3/ Q1-Q3/ Q1-Q3/
EUR million 2009 2008 Change-% 2009 2008 Change-% 2008
Gross rental income 44.4 44.1 0.6% 132.6 129.2 2.6% 173.0
Service charge
income 1.5 0.5 218.9% 4.8 3.9 23.7% 5.3
Turnover (Note 3) 45.9 44.6 3.0% 137.4 133.1 3.2% 178.3
Property operating
expenses 13.4 13.1 2.8% 43.2 41.4 4.3% 56.3
Other expenses from
leasing operations 0.0 0.1 -95.8% 0.4 0.1 262.2% 0.2
Net rental income 32.5 31.5 3.3% 93.8 91.6 2.4% 121.8
Administrative
expenses 3.9 3.9 0.1% 12.4 12.3 1.2% 16.9
Other operating
income and expenses 0.0 0.0 - 0.0 0.2 - 6.1
Net fair value
losses/gains on
investment property -1.2 -71.7 -98.4% -58.7 -156.7 -62.5% -216.1
Net gains/losses on
sale of investment
property - 0.0 - 0.1 0.1 -46.5% 0.1
Operating
profit/loss 27.4 -44.1 - 22.7 -77.1 - -105.0
Net financial
income and expenses 11.7 15.2 -22.8% 35.8 44.2 -19.2% 57.3
Profit/loss before
taxes 15.6 -59.3 - -13.1 -121.4 -89.2% -162.3
Current taxes -2.0 -1.0 104.0% -5.3 -4.4 19.6% -6.6
Change in deferred
taxes -0.3 8.4 - 5.8 22.4 -74.3% 30.0
Profit/loss for the
period 13.3 -51.9 - -12.6 -103.4 -87.8% -138.9
Other comprehensive
income/expenses
Net losses/gains on
cash flow hedges -1.8 -13.5 - -7.8 0.2 - -30.5
Income taxes
relating to cash
flow hedges 0.5 3.5 - 2.0 0.0 - 7.9
Exchange
gains/losses on
translating foreign
operations 1.9 -2.9 - 2.1 -3.2 - -13.0
Other comprehensive
income/expenses for
the period,
net of tax 0.6 -13.0 - -3.7 -3.0 21.3% -35.6
Total comprehensive
profit/loss for the
period 13.9 -64.8 - -16.3 -106.5 -84.7% -174.6
Profit/loss
attributable to
Parent company
shareholders 13.3 -46.0 - -10.5 -93.5 -88.8% -124.1
Minority interest 0.1 -5.9 - -2.1 -10.0 -78.9% -14.8
Total comprehensive
profit/loss
attributable to
Parent company
shareholders 12.7 -58.1 - -15.4 -95.6 -83.9% -156.8
Minority interest 1.2 -6.7 - -0.9 -10.8 -91.6% -17.8
Earnings per share
(basic), EUR (Note
5) 0.06 -0.21 - -0.05 -0.42 -88.8% -0.56
Earnings per share
(diluted), EUR
(Note 5) 0.06 -0.21 - -0.05 -0.42 -88.8% -0.56
Direct result (Note
4) 14.2 11.3 25.9% 38.4 31.9 20.1% 43.8
Indirect result
(Note 4) -0.9 -57.3 -98.4% -48.9 -125.4 -61.0% -167.9
Profit/loss for the
period attributable
to
parent company
shareholders 13.3 -46.0 - -10.5 -93.5 -88.8% -124.1
Condensed Consolidated Statement of Financial Position, IFRS
30 Sept. 30 Sept. 31 Dec.
EUR million Note 2009 2008 2008
Assets
Non-current assets
Investment properties 6 2,162.7 2,184.8 2,111.6
Intangible assets and property, plant
and equipment 1.7 1.8 1.7
Deferred tax assets 8.8 - 6.8
Derivative financial instruments and
other non-current assets 8 0.0 7.5 6.0
Total non-current assets 2,173.3 2,194.1 2,126.1
Current assets
Derivative financial instruments 8 3.7 9.5 13.9
Trade and other receivables 11.1 15.9 21.7
Cash and cash equivalents 7 19.4 18.7 16.7
Total current assets 34.1 44.2 52.4
Total assets 2,207.4 2,238.3 2,178.5
Liabilities and Shareholders' Equity
Equity attributable to parent company
shareholders
Share capital 259.6 259.6 259.6
Share premium fund and other
restricted reserves 131.1 131.1 131.1
Fair value reserve 8 -23.4 5.1 -17.7
Invested unrestricted equity fund 9 155.2 177.3 177.3
Retained earnings 9 231.6 282.6 248.8
Total equity attributable to parent
company shareholders 754.1 855.6 799.1
Minority interest 37.3 45.3 38.2
Total shareholders' equity 791.3 900.9 837.3
Liabilities
Long-term interest-bearing debt 10 1,174.5 1,111.2 1,149.2
Derivative financial instruments and
other non-interest bearing liabilities 8 34.6 1.8 25.5
Deferred tax liabilities 51.3 65.8 57.1
Total long-term liabilities 1,260.4 1,178.8 1,231.7
Short-term interest-bearing debt 10 106.8 113.0 50.3
Derivate financial instruments 8 0.5 0.0 4.9
Trade and other payables 48.4 45.6 54.3
Total short-term liabilities 155.6 158.6 109.5
Total liabilities 1,416.1 1,337.4 1,341.2
Total liabilities and shareholders'
equity 2,207.4 2,238.3 2,178.5
Condensed Consolidated Cash Flow Statement, IFRS
Q1-Q3/ Q1-Q3/
EUR million Note 2009 2008 2008
Cash flow from operating activities
Loss/profit before taxes -13.1 -121.4 -162.3
Adjustments 94.9 201.5 268.1
Cash flow before change in working capital 81.8 80.1 105.8
Change in working capital 6.7 -5.2 -2.1
Cash generated from operations 88.6 74.9 103.7
Paid interest and other financial charges -48.4 -46.8 -63.1
Interest income, exchange rate gains and
other financial income received 18.1 3.4 6.3
Taxes paid/received -5.1 -0.3 0.2
Net cash from operating activities 53.1 31.2 47.2
Cash flow from investing activities
Acquisition of subsidiaries, less cash
acquired 6 - -24.0 -24.0
Capital expenditure on investment
properties as well as on intangible assets
and PP&E 6 -78.1 -91.7 -127.0
Sale of investment properties 6 3.1 7.0 7.0
Net cash used in investing activities -75.0 -108.7 -144.1
Cash flow from financing activities
Equity contribution from minority
shareholder - 25.9 25.9
Proceeds from short-term loans 10 103.6 69.3 72.1
Repayments of short-term loans 10 -47.1 -60.0 -125.8
Proceeds from long-term loans 10 214.1 386.5 623.3
Repayments of long-term loans 10 -215.9 -318.1 -473.6
Dividends paid 9 -30.9 -30.9 -30.9
Net cash used in/from financing activities 23.7 72.5 90.9
Net change in cash and cash equivalents 1.8 -5.0 -6.1
Cash and cash equivalents at period-start 7 16.7 24.2 24.2
Effects of exchange rate changes 0.9 -0.4 -1.4
Cash and cash equivalents at period-end 7 19.4 18.7 16.7
Condensed Consolidated Statement of Changes in Shareholders' Equity,
IFRS
Equity attributable to parent company shareholders
Share
Premium
fund and Fair Invested
Share other value un-restricted Translation Retained
capital reserves reserve equity fund reserve earnings
Balance at 1
Jan. 2008 259.6 131.1 4.9 199.3 -0.3 387.3
Total
comprehensive
loss/profit
for the
period 0.1 -2.3 -93.5
Share
subscriptions
based on
stock options 0.0
Dividends and
return from
the invested
unrestricted
equity fund
(Note 9) -22.1 -8.8
Share-based
payments 0.3
Acquisition
of minority
interests
Balance at 30
Sept. 2008 259.6 131.1 5.1 177.3 -2.6 285.2
Balance at 1
Jan. 2009 259.6 131.1 -17.7 177.3 -10.3 259.1
Total
comprehensive
loss/profit
for the
period -5.8 0.9 -10.5
Recognized
gain in the
equity
arising from
convertible
bond buybacks 1.1
Sale of
treasury
shares 0.0
Dividends and
return from
the invested
unrestricted
equity fund
(Note 9) -22.1 -8.8
Share-based
payments 0.2
Balance at 30
Sept. 2009 259.6 131.1 -23.4 155.2 -9.4 241.0
Equity
attributable to
parent company Minority Shareholders'
shareholders interest equity, total
Balance at 1 Jan. 2008 982.0 28.9 1,010.9
Total comprehensive
loss/profit for the period -95.6 -10.8 -106.5
Share subscriptions based on
stock options 0.0 0.0
Dividends and return from the
invested unrestricted equity
fund (Note 9) -30.9 -30.9
Share-based payments 0.3 0.3
Acquisition of minority
interests - 27.1 27.1
Balance at 30 Sept. 2008 855.6 45.3 900.9
Balance at 1 Jan. 2009 799.1 38.2 837.3
Total comprehensive
loss/profit for the period -15.4 -0.9 -16.3
Recognized gain in the equity
arising from convertible bond
buybacks 1.1 1.1
Sale of treasury shares 0.0 0.0
Dividends and return from the
invested unrestricted equity
fund (Note 9) -30.9 -30.9
Share-based payments 0.2 0.2
Balance at 30 Sept. 2009 754.1 37.3 791.3
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Basic Company Data
Citycon is a real estate company investing in retail premises.
Citycon operates mainly in Finland, Sweden and the Baltic countries.
Citycon is a Finnish public limited liability company established
under Finnish law and domiciled in Helsinki. The Board of Directors
has approved the interim financial statements on 14 October 2009.
2. Basis of Preparation and Accounting Policies
Citycon prepares its consolidated financial statements in accordance
with the International Financial Reporting Standards (IFRS). The
interim condensed consolidated financial statements for the period 1
January-30 September 2009 have been prepared in accordance with IAS
34 Interim Financial Reporting. The following new standards as well
as amendments and interpretations to the existing standards have been
adopted in the interim financial statements: IFRS 8 (new standard)
Operating Segments, IAS 1 (revised) Presentation of Financial
Statements and IAS 40 (amendment) Investment Property and
consequential amendments to IAS 16 Property, Plant and Equipment. The
adoption of IFRS 8 Operating Segments and IAS 1 Presentation of
Financial Statements amended the presentation of financial statements
and the adoption of IAS 40 Investment Property changed the
measurement of development properties. The adoption of IFRS 8
Operating Segments did not change the number or the content of the
reported segments. The corporate management follows the segments'
direct operating profit. Therefore, direct operating profit for each
segment is presented due to the adoption of IFRS 8. The adoption of
IAS 1 Presentation of Financial Statements changed the income
statement format and the format of statement of changes in the
shareholders' equity. Due to the adoption of IAS 40 Investment
Property, Citycon measures its development properties in fair value
instead of at cost. Since the development properties are now measured
at fair value just like the operative investment properties, Citycon
no longer presents development properties separately from investment
properties on the statement of financial position. In the Notes to
the Financial Statements, Citycon divides its investment properties
into two groups: operative investment properties and
development/redevelopment properties. The fair value gains of the
development properties amounted to EUR 11.4 million during the
Q1/2009. Additional information on the new standards as well as on
the amendments and interpretations to the existing standards are
available in Citycon's Financial Statements 2008, in Chapter 3
"Changes in IFRS and accounting policies" under the Notes to the
Consolidated Financial Statements (see pages 18-19 in the Financial
Statements).
Otherwise, same accounting principles and policies are applied in the
interim financial statements as in the annual financial statements
for the year 2008. The interim financial statements do not include
all the disclosures required to be disclosed in the annual financial
statements. Therefore, they should be read in conjunction with
Citycon's annual financial statements for the year 2008.
3. Segment Information
Citycon's business consists of the regional business units Finland,
Sweden and the Baltic Countries.
Q3/ Q3/ Q1-Q3/ Q1-Q3/
EUR million 2009 2008 Change-% 2009 2008 Change-% 2008
Turnover
Finland 32.4 31.9 1.7% 98.5 94.8 3.9% 126.8
Sweden 9.9 10.5 -6.0% 28.7 31.8 -9.8% 41.9
Baltic Countries 3.6 2.1 66.6% 10.2 6.5 57.3% 9.6
Total 45.9 44.6 3.0% 137.4 133.1 3.2% 178.3
Net rental income
Finland 23.4 23.4 0.0% 69.4 68.2 1.6% 90.9
Sweden 6.4 6.5 -2.6% 17.2 18.8 -8.5% 24.1
Baltic Countries 2.7 1.5 79.4% 7.3 4.6 58.9% 6.8
Other 0.0 0.0 - 0.0 0.0 - 0.0
Total 32.5 31.5 3.3% 93.8 91.6 2.4% 121.8
Direct operating
profit/loss
Finland 22.0 22.1 -0.6% 64.9 64.3 0.9% 85.4
Sweden 5.7 6.0 -6.1% 14.9 16.5 -9.7% 21.0
Baltic Countries 2.5 1.4 84.5% 6.6 4.2 58.8% 6.2
Other -1.6 -1.9 -15.8% -5.1 -5.2 -3.6% -7.2
Total 28.6 27.6 3.5% 81.4 79.7 2.1% 105.3
Operating
profit/loss
Finland 17.4 -22.9 - 14.4 -41.2 - -62.9
Sweden 4.4 -23.3 - 12.3 -32.2 - -49.1
Baltic Countries 7.2 4.0 80.7% 1.1 1.8 -40.3% 14.4
Other -1.6 -1.9 -15.8% -5.1 -5.5 -7.1% -7.4
Total 27.4 -44.1 - 22.7 -77.1 - -105.0
EUR million
Assets 30 Sept. 2009 30 Sept. 2008 Change-% 31 Dec. 2008
Finland 1,455.6 1,539.2 -5.4% 1,504.2
Sweden 555.5 520.6 6.7% 466.9
Baltic Countries 162.9 139.4 16.9% 156.3
Other 33.4 39.1 -14.6% 51.1
Total 2,207.4 2 238.3 -1.4% 2,178.5
The change in segment assets was due to the fair value losses in
investment properties, weakened Swedish krona and capital
expenditure.
4. Reconciliation between Direct and Indirect Result
Due to the nature of Citycon's business and the obligation to apply
IFRS, the consolidated statement of comprehensive income includes
several items related to non-operating activities. In addition to the
consolidated statement of comprehensive income under IFRS, Citycon
also presents its profit/loss attributable to parent company
shareholders with direct result and indirect result separately
specified, in an attempt to enhance the transparency of its
operations and to facilitate comparability of reporting periods.
Direct result describes the profitability of the Group's operations
during the reporting period disregarding the effects of fair value
changes, gains or losses on sales, other extraordinary items and
other comprehensive income items. Earnings per share calculated based
on direct result corresponds to the earnings per share definition
recommended by EPRA.
Direct result excludes the changes in fair value of financial
instruments that are recognized in the statement of comprehensive
income under net financial income and expenses. In order to hedge
against interest rate risk, Citycon has entered into, in accordance
with its interest rate risk management policy, interest rate and
inflation derivatives which do not qualify under hedge accounting
treatment under IFRS. Changes in fair value of such derivatives are
recognized in the statement of comprehensive income under net
financial income and expenses. These derivatives hedge the group
against interest rate risk and in accordance with the terms of the
derivatives Citycon receives floating money market interest rate
which has a matching interest rate determination procedure with
group's floating rate debt. The interest rate which Citycon pays
under these derivatives does not depend on the money market interest
rate which means that these derivatives hedge Citycon against rising
floating interest rates. The aim is to ensure effectiveness of the
hedges by matching the interest rate fixing procedure between the
derivatives recognized in the statement of comprehensive income under
net financial income and expenses and floating rate debt of Citycon.
Q3/ Q3/ Change- Q1-Q3/ Q1-Q3/ Change-
EUR million 2009 2008 % 2009 2008 % 2008
Direct result
Net rental income 32.5 31.5 3.3% 93.8 91.6 2.4% 121.8
Direct
administrative
expenses -3.9 -3.9 0.1% -12.4 -11.9 4.1% -16.5
Direct other
operating income and
expenses 0.0 0.0 - 0.0 0.0 - 0.1
Direct operating
profit 28.6 27.6 3.5% 81.4 79.7 2.1% 105.3
Direct net financial
income and expenses -11.7 -14.6 -20.1% -35.8 -42.5 -15.9% -54.2
Direct current taxes -2.0 -1.0 104.0% -5.0 -3.3 49.0% -4.8
Direct change in
deferred taxes 0.1 0.2 -58.6% -0.1 0.2 - 0.2
Direct minority
interest -0.7 -0.9 -18.4% -2.1 -2.1 3.3% -2.8
Total direct result 14.2 11.3 25.9% 38.4 31.9 20.1% 43.8
Direct result per
share (diluted),
(diluted EPRA EPS),
EUR 1) 0.06 0.05 24.0% 0.17 0.15 18.4% 0.20
Indirect result
Net fair value
losses/gains on
investment property -1.2 -71.7 -98.4% -58.7 -156.7 -62.5% -216.1
Profit/loss on
disposal of
investment property - 0.0 - 0.1 0.1 -46.5% 0.1
Indirect
administrative
expenses - 0.0 - - -0.3 - -0.4
Indirect other
operating income and
expenses - - - - 0.1 - 6.0
Movement in fair
value of financial
instruments 0.0 -0.6 -92.8% 0.0 -1.7 - -3.1
Indirect current
taxes - - - -0.3 -1.1 -72.6% -1.8
Change in indirect
deferred taxes -0.4 8.2 - 5.9 22.2 -73.6% 29.7
Indirect minority
interest 0.7 6.8 -90.0% 4.2 12.0 -64.7% 17.6
Total indirect
result -0.9 -57.3 -98.4% -48.9 -125.4 -61.0% -167.9
Indirect result per
share, diluted 0.00 -0.26 -98.5% -0.22 -0.57 -61.2% -0.76
Profit/loss for the
period attributable
to
parent company
shareholders 13.3 -46.0 - -10.5 -93.5 -88.8% -124.1
¹) The calculation of the direct result per share is presented in the
Note 5 "Earnings per share".
5. Earnings per Share
Q1-Q3 Q1-Q3
/2009 /2008 2008
A) Earnings per share calculated from the profit/loss for the
period
Earnings per share, basic
Loss/profit attributable to parent company
shareholders, EUR million -10.5 -93.5 -124.1
Issue-adjusted average number of shares, Million 221.0 221.0 221.0
Earnings per share (basic), EUR -0.05 -0.42 -0.56
Earnings per share, diluted
Loss/profit attributable to parent company
shareholders, EUR million -10.5 -93.5 -124.1
Expenses from convertible capital loan, the tax
effect deducted, EUR million - - -
Loss/profit used in the calculation of diluted
earnings per share, EUR million -10.5 -93.5 -124.1
Issue-adjusted average number of shares, Million 221.0 221.0 221.0
Convertible capital loan impact, Million - - -
Adjustment for stock options, Million - - -
Issue-adjusted average number of shares used in
the calculation of diluted earnings per share,
Million 221.0 221.0 221.0
Earnings per share (diluted), EUR -0.05 -0.42 -0.56
The incremental shares from assumed conversions or any income or cost
related to dilutive potential shares are not included in calculating
Q1-Q3/2009 and 2008 diluted per-share figures because the profit
attributable to parent company shareholders was negative.
B) Earnings per share calculated from the direct result for the
period
Direct result per share (diluted), (diluted EPRA EPS)
Direct result, EUR million (Note 4) 38.4 31.9 43.8
Expenses arising from convertible capital loan,
adjusted with the tax effect deduction, EUR million 3.1 4.3 5.6
Profit used in the calculation of direct result per
share, EUR million 41.5 36.3 49.4
Issue-adjusted average number of shares used in the
calculation of diluted earnings per share, Million 239.6 248.0 247.2
Direct result per share (diluted), (diluted EPRA
EPS), EUR 0.17 0.15 0.20
6. Investment Property
Citycon divides its investment properties into two categories:
properties under redevelopment and operative investment properties.
Due to the adoption of amended IAS 40 Investment property -standard,
Citycon presents the development properties under the investment
properties. Therefore, previously presented properties under
redevelopment -category is extended to include also development
properties and is called development/redevelopment properties. During
the period, development/redevelopment properties included the
projects in the following shopping centres: Liljeholmstorget, Rocca
al Mare, Lippulaiva, Åkersberga Centrum, Jakobsbergs Centrum,
Stenungs Torg and Porin Isolinnankatu 18.
EUR million 30 Sept. 2009
Development/ Operative Investment
redevelopment investment properties
properties properties total
At period-start 271.8 1,839.9 2,111.6
Acquisitions - - -
Investments 70.8 7.1 77.9
Disposals - -2.7 -2.7
Capitalized interest 5.5 0.3 5.8
Fair value gains on investment
property 5.5 5.2 10.7
Fair value losses on investment
property -3.9 -65.5 -69.5
Exchange differences 15.0 13.8 28.8
Transfers between items 226.5 -226.5 0.0
At period-end 591.1 1,571.6 2,162.7
EUR million 30 Sept. 2008
Development/ Operative Investment
redevelopment investment properties
properties properties total
At period-start 544.5 1,704.4 2,248.9
Acquisitions 6.8 11.1 17.9
Investments 87.2 9.5 96.7
Disposals - -7.6 -7.6
Capitalized interest 2.4 2.6 4.9
Fair value gains on investment
property 2.2 1.5 3.7
Fair value losses on investment
property -34.1 -126.4 -160.5
Exchange differences -7.9 -11.4 -19.3
Transfers between items -69.9 69.9 0.0
At period-end 531.3 1,653.5 2,184.8
EUR million 31 Dec. 2008
Development/ Operative Investment
redevelopment investment properties
properties properties total
At period-start 544.5 1,704.4 2,248.9
Acquisitions 6.8 10.6 17.4
Investments 120.9 12.0 132.9
Disposals 0.0 -7.6 -7.6
Capitalized interest 6.8 0.0 6.8
Fair value gains on investment
property 4.8 10.5 15.3
Fair value losses on investment
property -44.5 -186.9 -231.4
Exchange differences -28.8 -41.6 -70.4
Transfers between items -338.7 338.5 -0.2
At period-end 271.8 1,839.9 2,111.6
An external professional appraiser has conducted the valuation of the
company's investment properties with a net rental income based cash
flow analysis. Market rents, occupancy rate, operating expenses and
yield requirement form the key variables used in the cash flow
analysis. The segments' yield requirements and market rents used by
the external appraiser in the cash flow analysis were as follows:
Yield requirement (%) Market rents (€/m²)
30 Sept. 30 Sept. 31 Dec. 30 Sept. 30 Sept. 31 Dec.
2009 2008 2008 2009 2008 2008
Finland 6.5 6.2 6.4 22.4 21.7 21.9
Sweden 1) 6.4 6.0 6.4 20.9 13.4 12.3
Baltic
Countries 7.9 7.1 7.4 21.3 20.7 20.2
Average 6.6 6.2 6.4 22.0 19.8 19.9
1) Figures for Sweden on 30 September 2009 include the development
project of the Liljeholmstorget shopping centre.
7. Cash and Cash Equivalents
EUR million 30 Sept. 2009 30 Sept. 2008 31 Dec. 2008
Cash in hand and at bank 19.4 17.0 16.7
Short-term deposits - 1.8 -
Total 19.4 18.7 16.7
8. Derivative Financial Instruments
EUR million 30 Sept. 2009 30 Sept. 2008 31 Dec. 2008
Nominal Fair Nominal Fair Nominal Fair
amount value amount value amount value
Interest rate derivatives
Interest rate swaps
Maturity:
less than 1 year 66.0 -0.4 86.4 0.9 86.0 1.4
1-2 years 118.9 -0.9 66.0 -0.4 46.0 -1.5
2-3 years 40.0 -2.0 70.0 3.0 70.0 3.5
3-4 years 204.8 -12.1 40.0 0.9 41.8 -1.9
4-5 years 202.1 -11.0 178.0 2.0 228.8 -10.1
over 5 years 143.1 -3.6 229.3 3.3 119.0 -8.9
Subtotal 774.8 -30.1 669.7 9.7 591.7 -17.5
Foreign exchange derivatives
Forward agreements
Maturity:
less than 1 year 3.0 -0.1 157.1 6.3 23.1 7.6
Total 777.9 -30.2 826.8 16.1 614.8 -9.8
The fair value of derivative financial instruments represents the
market value of the instrument with prices prevailing at the end of
the period. Derivative financial instruments are used in hedging the
interest rate risk of the interest bearing liabilities and foreign
currency risk.
The fair values include foreign exchange rate gain of EUR 3.6 million
(EUR 9.6 million) which is recognized in the statement of
comprehensive income under net financial income and expenses.
Hedge accounting is applied for interest rates swaps which have
nominal amount of EUR 750.4 million (EUR 593.3 million). The fair
value loss recognized under other comprehensive income taking into
account the tax effect totals EUR -5.8 million (EUR 0.1 million).
9. Dividends and Return from the Invested Unrestricted Equity Fund
In accordance with the proposal by the Board of Directors and the
decision by the Annual General Meeting held on 18 March 2009,
dividend for the financial year 2008 amounted to EUR 0.04 per share
(EUR 0.04 for the financial year 2007) and EUR 0.10 per share was
decided to be returned from the invested unrestricted equity fund
(EUR 0.10 for the financial year 2007). Dividend and equity return of
EUR 30.9 million for the financial year 2008 (EUR 30.9 million for
the financial year 2007) were paid on 3 April 2009.
10. Interest-bearing Liabilities
During the period, Citycon has agreed on a new revolving credit
facility in the amount of EUR 75 million in order to finance future
strategic investments. The loan bears a floating interest rate and is
due within 3 years. During the period, repayments of other bank loans
amounting to EUR 30.2 million were made in line with previously
disclosed repayment terms.
Other proceeds and repayments from/of long-term loans in the
cash-flow statement arose from the use of revolving credit
facilities.
11. Contingent Liabilities
EUR million 30 Sept. 2009 30 Sept. 2008 31 Dec. 2008
Mortgages on land and
buildings 43.0 44.8 40.6
Bank guarantees 43.5 48.0 45.6
Capital commitments 44.5 23.2 13.0
On 30 September 2009, Citycon had capital commitments of EUR 44.5
million (EUR 23.2 million) relating mainly to development and
redevelopment projects.
12. Related Party Transactions
There were no significant transactions with the related parties
during the period.
13. Key Figures
Q3/ Q3/ Q1-Q3/ Q1-Q3/
2009 2008 Change-% 2009 2008 Change-% 2008
Earnings per share
(basic), EUR 0.06 -0.21 - -0.05 -0.42 -88.8% -0.56
Earnings per share
(diluted), EUR 0.06 -0.21 - -0.05 -0.42 -88.8% -0.56
Equity per share,
EUR 3.41 3.87 -11.9% 3.62
Net asset value
(EPRA NAV) per
share, EUR 3.64 4.16 -12.5% 3.88
Equity ratio, % 35.9 40.3 - 38.5
The formulas for key figures can be found from the 2008 annual
financial statements.
Financial statements and financial statements bulletin 2009
Citycon will publish its financial statements and a financial
statements bulletin for the financial year 1 January - 31 December
2009 on Wednesday, 10 February 2010 at about 9:00 a.m.
For further information for investors, please visit Citycon's
website, www.citycon.com.
For further information, please contact:
Petri Olkinuora, CEO
Tel +358 20 766 4401 or +358 400 333 256
petri.olkinuora@citycon.fi
Eero Sihvonen, CFO
Tel +358 20 766 4459 or +358 50 557 9137
eero.sihvonen@citycon.fi
Distribution:
NASDAQ OMX Helsinki
Major media
www.citycon.com
REPORT ON REVIEW OF CITYCON OYJ'S INTERIM FINANCIAL INFORMATION FOR
THE PERIOD JANUARY 1 - SEPTEMBER 30, 2009
To the Board of Directors of Citycon Oyj
Introduction
We have reviewed the accompanying statement of financial position of
Citycon Oyj as of September 30, 2009 and the related statements of
comprehensive income, changes in equity and cash flows for the
nine-month period then ended, and explanatory notes prepared in
accordance with International Financial Reporting Standards as
adopted by the EU. The Board of Directors and the Managing Director
are responsible for the preparation and fair presentation of this
interim financial information in accordance with the Securities
Market Act, chapter 2, paragraph 5 a. Based on our interim review we
express at the request of the Board of Directors a report in
accordance with the Securities Market Act, chapter 2, paragraph 5 a,
sub-paragraph 7.
Scope of Review
We conducted our review in accordance with International Standard on
Review Engagements 2410, "Review of Interim Financial Information
Performed by the Independent Auditor of the Entity." A review of
interim financial information consists of making inquiries, primarily
of persons responsible for financial and accounting matters, and
applying analytical and other review procedures. A review is
substantially less in scope than an audit conducted in accordance
with Standards on Auditing and consequently does not enable us to
obtain assurance that we would become aware of all significant
matters that might be identified in an audit. Accordingly, we do not
express an audit opinion.
Opinion
Based on our review, nothing has come to our attention that causes us
to believe that the accompanying interim financial information,
prepared in accordance with International Financial Reporting
Standards as adopted by the EU, does not give a true and fair view of
the financial position of the entity as at September 30, 2009, and of
its financial performance and its cash flows for the nine-month
period then ended in accordance with the Securities Market Act.
Helsinki, October 14, 2009
Ernst & Young Oy
Authorized Public Accountants
Tuija Korpelainen, Authorized Public Accountant