Citycon's Interim Report 1 January-30 June 2006

Stock exchange releases - 21 July 2006


Citycon's Interim Report 1 January-30 June 2006

Summary

- Turnover increased by 29.5 per cent, to EUR 55.0 million (1-6/2005: EUR 42.5
million).

- Net rental income increased to EUR 39.0 million (EUR 31.2 million) while that
for like-for-like properties grew by 3.2 per cent.

- Profit before taxes came to EUR 95.8 million (EUR 17.2 million), including EUR
75.3 million (EUR 7.8 million) in fair-value increase in investment properties.

- Earnings per share were EUR 0.47 (EUR 0.11).
Earnings per share excluding the valuation items and the related tax impact were
EUR 0.10 per share (EUR 0.06).

- The market value of Citycon's property portfolio increased by 51.5 per cent, to
EUR 1,143.2 million (30 June 2005: EUR 754.7 million).

- Net financial expenses decreased by 29.5 per cent to EUR 12.9 million (EUR 18.3
million). 1-6/2005 figure included one-off expenses of EUR 5.7 million.

- Citycon expanded its business operations to Lithuania by buying the Mandarinas
shopping centre and made several major investments in Finland and Sweden during
the reporting period.

- Citycon successfully completed a EUR 75 million rights issue.

Key Figures and Ratios
1-6 2006 1-6 2005 1-12 2005
Turnover, EUR million 55.0 42.5 92.2
Operating profit, EUR million 108.7 35.6 105.2
% of turnover 197.5 83.8 114.1
Profit before taxes, EUR million 95.8 17.2 74.2
Profit for the period, EUR million 72.7 13.3 59.8

Fair market value of investment
properties, EUR million 1,143.2 754.7 956.6

Earnings per share (basic), EUR 0.47 0.11 0.47
Earnings per share (diluted), EUR
(EPRA EPS) 0.47 0.11 0.46
Earnings per share (basic), excluding the
effects of change in fair values, EUR 0.10 0.06 0.20
Net cash from operating activities
per share, EUR 0.10 0.05 0.19
Equity per share, EUR (EPRA NAV) 2.98 1.94 2.45
Triple net NAV per
share, EUR (EPRA NNNAV) 3.00 1.94 2.45
P/E (price / earnings) ratio 4 14 7

Return on equity (ROE), % 35.0 11.2 22.5
Return on investment (ROI), % 20.4 9.5 13.5
Equity ratio, % 42.3 28.9 36.7
Gearing, % 122.9 217.2 156.8
Net rental yield, % 8.0 8.8 8.5
Occupancy rate, % 96.7 96.3 97.2
Personnel at the end of the period 61 46 57

CEO Petri Olkinuora: "Citycon's business operations have progressed according to
plan. During the period, we have announced transactions worth approximately EUR
350 million out of which about EUR 225 million is expected to close during the
next quarter. Our operations have expanded to new markets in Lithuania and the
Greater Gothenburg region in Sweden.

Implemented capital expenditure totalled EUR 114.2 million, pushing the market
value of Citycon's property portfolio to EUR 1,143.2 million. The market for the
shopping-centre business remained favourable, in spite of increasing competition.

Citycon improved its reported turnover by 29.5 per cent, to EUR 55.0 million, due
mainly to strategy-based property investments made in Finland, Sweden and the
Baltic countries in 2005 and 2006.

Profit for the reporting period increased to EUR 72.7 million, while earnings per
share amounted to EUR 0.47.

We will continue to implement our growth strategy by making new acquisitions if
good opportunities come up and by developing our existing property portfolio."

The EPRA Best Practices Policy Recommendations

In January 2006 the European Public Real Estate Association (EPRA), which
represents listed European property investment companies, published financial
reporting recommendations for these companies. Citycon Oyj has started to apply
these recommendations in its financial reporting as of this Interim Report. The
recommendations do not replace IAS/IFRS standards, but complement them.

In conjunction with the adoption of the EPRA recommendations, Citycon Oyj has
changed its income statement presentation so that information is presented by
function instead of by expense type. Thus, the income statement also includes
gross and net rental income.

Citycon is confident that the adoption of the EPRA recommendations helps
investors to better evaluate its earning power and increases the transparency of
its investor information. In addition to the new income statement presentation,
Citycon publishes a new key figure Triple net NAV (EPRA NNNAV). The
recommendations are available in their entirety on EPRA's website at
www.epra.com.

As Citycon applies the fair-value model in the measurement of its investment
properties under IAS 40, Citycon IFRS profit equals the EPRA profit. IFRS diluted
earnings per share is the same as EPRA earnings per share. EPRA NAV corresponds
to the reported IFRS shareholders' equity.

Citycon's NNNAV increased by 114.1 per cent, to EUR 494.3 million in the first
half of the year. NNNAV per share was EUR 3.00.

Key Figure in Accordance with EPRA Recommendations
EUR million
1-6 2006 1-6 2005 1-12 2005
EPRA NAV 491.4 230.9 356.6
(iv) Fair value gains/losses of
financial instruments in the income
statement - - -
(iv) The difference between the
fair and book value of debt 3.0 0.0 0.5
(iii) Deferred taxes - - -
EPRA NNNAV 494.3 230.9 357.1

per share (diluted), EUR

EPRA NAV 2.98 1.94 2.45
(iv) Fair value gains/losses of
financial instruments in the income
statement - - -
(iv) The difference between the
fair and book value of debt 0.02 0.00 0.00
(iii) Deferred taxes - - -
EPRA NNNAV 3.00 1.94 2.45

Business Environment

International investors continued to show a keen interest in Finnish retail
properties. Finnish retail sales continued to grow, further strengthening retail
traders' positive expectations. Demand for retail premises was still active and
occupancy rates remained high. The growth in inflation and interest rates did not
have any major effect on the market situation. The interest rates continue to be
at low levels despite the latest growth.

Property Portfolio in Summary

Citycon engages in the retail-property business throughout the entire ownership
chain, i.e. development, ownership, leasing and management of properties. Citycon
operates through the following three divisions: Shopping Centres, Supermarkets
and Shops, and Property Development.

At the end of the reporting period, the company owned 29 (16) shopping and retail
centres and 127 (127) supermarkets and shops. On 30 June 2006, the market value
of the company's property portfolio totalled EUR 1,143.2 million (31 December
2005: EUR 956.6 million), of which shopping and retail centres accounted for 70.1
per cent (60.9 per cent) and supermarkets and shops 29.9 per cent (39.1 per
cent). Finland, Sweden, Estonia and Lithuania account for 83.2 per cent, 10.0 per
cent, 5.6 per cent and 1.3 per cent of the company's property portfolio,
respectively, based on fair values.

Changes in Property Portfolio Fair Value

Citycon applies the fair-value model in the measurement of its investment
properties under IAS 40, whereby changes in fair value are recognised through
profit or loss. The most recent valuation statement, dated 10 July 2006, on the
Citycon property portfolio's June-end status, based on an appraisal by Aberdeen
Property Investors Finland Oy, is available on the company's website at
www.citycon.fi. More detailed information on this valuation method is available
in Citycon's Annual Report 2005, page 14.

During the reporting period, the fair value change of Citycon's property
portfolio totalled EUR 75.3 million. The period saw a total value increase of EUR
82.5 million and a total value decrease of EUR 7.1 million.

The average net yield requirement defined by Aberdeen Property Investors Finland
Oy for Citycon's property portfolio decreased to 7.1 per cent (on 31 December
2005, the average net yield requirement was 7.6 per cent). This decrease is
mainly due to the very active property market.

Lease Portfolio and Occupancy Rate

At the end of the period, Citycon had a total of 2,373 leases with 1,475 lessees,
and the occupancy rate for the company's property portfolio stood at 96.7 per
cent (96.3 per cent) with a net yield of 8.0 per cent (8.8 per cent).

Net rental income during the reporting period increased by 25.0 per cent, to EUR
39.0 million while gross rental income increased by 27.9 per cent, to EUR 52.8
million, due mainly to property investments made during the period. Citycon's
income statement includes net and gross rental income in accordance with EPRA's
recommendations.

Net rental income for like-for-like properties grew by 3.2 per cent. Like-for-
like properties refer to properties held by Citycon through the 24-month
reference period. Properties under development and expansion as well as lots are
excluded from like-for-like properties.

The calculation method for net yield and standing investments (like-for-like) is
based on the guidelines of the KTI Institute for Real Estate Economics and the
IPD Investment Property Databank.

Lease portfolio summary
1-6 2006 1-6 2005 1-12 2005
Number of leases started
during the period 201 130 298
Total area of leases started, sq.m. 48,986 24,895 51,476
Occupancy rate at end of the period, % 96.7% 96.3% 97.2%
Average length of lease portfolio at
the end of the period, year 2.9 3.4 3.2

Shopping Centres

Citycon leads the Finnish shopping centre business. The company's net rental
income from shopping centres improved by 41.8 per cent, to EUR 26.0 million.
Shopping centres accounted for 66.7 per cent of Citycon's total net rental
income.

Lease portfolio summary, shopping centres
1-6 2006 1-6 2005 1-12 2005
Number of leases started during
the period 156 101 233
Total area of leases started, sq.m. 23,249 10,213 29,160
Occupancy rate at end of the period, % 97.4% 96.8% 98.0%
Average length of lease portfolio at
the end of the period, year 2.3 2.6 2.6

Financial performance, shopping centres
1-6 2006 1-6 2005 1-12 2005
Turnover, EUR million 37.3 25.3 57.4
Net fair value gains on investment
property, EUR million 62.1 4.4 22.1
Operating profit, EUR million 86.8 22.0 61.2
Gross rental income, EUR million 35.2 24.3 54.5
Net rental income, EUR million 26.0 18.4 41.3
Net rental yield, % 7.7 8.3 8.2
Net rental yield, like-for-like
properties, % 8.2 8.4 8.4
Market value of property portfolio,
EUR million 801.8 459.4 636.7
Capital expenditure, EUR million 113.4 2.4 174.9

Capital expenditure and development projects

During the reporting period, Citycon made several major investments in Finland,
Sweden and the Baltic countries.

In Finland, the company acquired the rest of the Myyrmanni shopping centre in
Vantaa as well as the Tullintori shopping centre in Tampere and the Valtari
shopping centre in Kouvola. In Sweden, Citycon acquired retail centres in
Lindome, Backa, Hindås, Landvetter and Floda in the Greater Gothenburg Area, with
the related capital expenditure totalling EUR 80.1 million.

In the Baltic countries, Citycon expanded its operations to Lithuania by buying
the Mandarinas shopping centre located in Vilnius at the debt-free purchase price
of approximately EUR 14.3 million.

In May, Citycon announced that it will buy the Stenungstorg shopping centre near
Gothenburg, Sweden, for EUR 41.9 million. The transaction is expected to be
finalised in early September 2006.

In June, Citycon announced that it will buy the Columbus shopping centre in
Helsinki for EUR 80.1 million and the Jakobsberg Centrum shopping centre in the
Stockholm Metropolitan Area for EUR 104.5 million. The Columbus deal was closed
in July and the Jakobsberg transaction is expected to be finalised by the end of
August.

Upon the closing of the aforementioned deals, Citycon owns 19 shopping centres in
Finland, 11 shopping and retail centres in Sweden and two shopping centres in the
Baltic countries.

Supermarkets and Shops

Specialising in the development, lease and management of supermarket and other
retail-outlet properties, the Supermarkets and Shops division reported a 1.4 per
cent improvement in net rental income, to EUR 13.0 million.

Lease portfolio summary, supermarkets and shops
1-6 2006 1-6 2005 1-12 2005
Number of leases started
during the period 45 29 65
Total area of leases started, sq.m. 25,737 14,682 22,316
Occupancy rate at end of the period, % 95.4% 95.6% 95.8%
Average length of lease portfolio at
the end of the period, year 4.1 4.6 4.2

Financial performance, supermarkets and shops
1-6 2006 1-6 2005 1-12 2005
Turnover, EUR million 17.8 17.2 34.8
Net fair value gains on investment
property, EUR million 13.3 3.4 23.8
Operating profit, EUR million 26.1 16.2 49.6
Gross rental income, EUR million 17.6 17.0 34.5
Net rental income, EUR million 13.0 12.8 25.6
Net rental yield, % 8.6 9.5 9.1
Net rental yield, like-for-like
properties, % 8.7 9.7 9.2
Market value of property portfolio,
EUR million 341.4 295.3 320.0
Capital expenditure, EUR million 0.7 3.5 3.6

Property Development

The Property Development division's mission is to develop and extend Citycon's
existing and new retail sites together with the company's other divisions. The
division is also responsible for commissioning the construction of new retail
sites. The division's key figures are not reported separately because it has no
property portfolio or rental income.

The division's largest-scale projects underway include the extension and
refurbishment of the Hervanta shopping centre in Tampere and Lippulaiva in Espoo.
Furthermore, Citycon has decided to build a new retail centre in Kaarina, five
kilometres from downtown Turku, the project's value totalling EUR 8.2 million.
Construction of the retail centre for Tokmanni Oy is scheduled for completion by
1 March 2007. In Seinäjoki, Citycon has launched the refurbishment of the
Torikeskus shopping centre, which will be carried out in stages during 2006-2008.
Citycon will invest approximately EUR 4 million in this project.

Human Resources and Administrative Expenses

At the end of the period, Citycon Group had a total of 61 (46) employees, 55 of
whom worked in Finland, 5 in Estonia and 1 in Lithuania. Administrative expenses
increased by 52.5 per cent, to EUR 5.9 million, due in part to the expansion of
the company's operations and property portfolio.

Turnover and Profit

Turnover for the period came to EUR 55.0 million (EUR 42.5 million), of which
gross rental income accounted for 96.0 per cent (97.2 per cent).

Operating profit rose to EUR 108.7 million (EUR 35.6 million). Profit before
taxes amounted to EUR 95.8 million (EUR 17.2 million) and after taxes EUR 72.7
million (EUR 13.3 million). The effect of changes in the property portfolio's
fair value and the related tax impact on the reported profit was EUR 57.0
million. Taking this into account, the reported profit after taxes is EUR 8.1
million above the 1-6/2005 level. The increase in earnings resulted mainly from
higher net rental income and lower net financial expenses. 1-6/2005 net financial
expenses included the one-off expenses of EUR 5.7 million. Earnings per share
excluding the change in fair value were EUR 0.10 (EUR 0.06).

Capital Expenditure

Citycon's capital expenditure totalled EUR 114.2 million (EUR 5.9 million), of
which property acquisitions and property development accounted for EUR 101.0
million (EUR 4.1 million) and EUR 13.2 million (EUR 1.9 million), respectively.

Part of the capital expenditure was financed through the EUR 75 million rights
issue arranged during the reporting period.

Balance Sheet and Financial Position

The period-end balance sheet total stood at EUR 1,170.6 million (EUR 800.4
million), of which cash and cash equivalents accounted for EUR 17.7 million (EUR
35.5 million). The Group's financial position remained at a healthy level.

On 30 June 2006, Group liabilities totalled EUR 675.4 million (EUR 569.5
million), short-term liabilities accounting for EUR 104.9 million (EUR 35.0
million).

Interest-bearing liabilities increased by EUR 89.3 million, to EUR 626.2 million
(EUR 536.9 million), their interest rate averaging 4.3 per cent (5.1 per cent).
The average loan maturity, weighted according to loan principals, was 2.5 years
(3.2 years), while the average interest-bearing period was 2.4 years (3.1 years).
The currency risk related to financing the investments in Sweden, Estonia and
Lithuania is hedged by financing in local currency.

The Group's equity ratio was 42.3 per cent (28.9 per cent). Interest cover, or
the previous 12 months' profit before interest expenses, taxes and depreciation
relative to net financial expenses, was 2.5 (2.2). Period-end gearing stood at
122.9 per cent (217.2 per cent).

Citycon's period-end interest-bearing liabilities included 88.5 per cent (86.9
per cent) of floating-rate loans, of which 71.3 per cent (72.7 per cent) had been
converted into fixed rate loans, based on interest-rate swaps. The overall
hedging rate of the loan portfolio was 63.1 per cent. On 30 June 2006, the
nominal value of interest rate-swaps totalled EUR 395.1 million (EUR 337.9
million) while the market value of derivatives came to EUR -6.0 million (EUR
-24.1 million).

Net financial expenses totalled EUR 12.9 million (EUR 18.3 million). The decrease
in net financial expenses resulted mainly from the one-off expenses of EUR 5.7
million included in 2005 net financial expenses.

Commercial paper programme

In February 2006, Citycon signed a new commercial paper programme worth EUR 100
million, replacing its previous commercial paper programmes valued at EUR 60
million.

Rights issue

During the period, Citycon carried out a EUR 75 million rights issue that was
successfully completed on 21 April 2006. Consequently, a total of 27,274,949 new
shares were subscribed at a subscription price of EUR 2.75 per share, equalling
approximately 99.4 per cent of the shares offered. The resulting share-capital
increase of EUR 36,821,181.15 was registered in the Trade Register on 28 April
2006 and the new shares have been available for public trading on the Helsinki
Stock Exchange's Main List as of 2 May 2006.

More detailed information on the rights issue can be found in Citycon's stock-
exchange releases, published in March-April 2006 and available on the company's
website at www.citycon.fi.

Share Capital and Shares

Under the Articles of Association, Citycon's minimum share capital totals EUR 100
million and maximum share capital EUR 500 million, within which limits the
company may reduce or increase its share capital without altering its Articles of
Association. The company has a single series of shares, with each share entitling
its holder to one vote at the shareholders' meeting.

At the beginning of 2006, Citycon had a share capital of EUR 184,115,724.30 and
the number of shares totalled 136,382,018. The reporting period saw Citycon
increase its share capital through a rights issue and share subscriptions based
on stock options by a total of EUR 37,632,509.55. The attached table shows the
changes in share capital in more detail. The company's period-end registered
share capital amounted to EUR 222,781,429.35 and the number of shares totalled
165,023,281, each share bearing a nominal value of EUR 1.35.

Changes in share capital from 1 January to 30 June 2006

Date Reason/ Change in Share capital, Number of
2006 Change, No. of EUR shares
EUR shares
1 Jan. 184,115,724.30 136,382,018
16 Feb. Increase (stock options)
1,012,945.50 750,330 185,128,669.80 137,132,348
28 March Increase (stock options)
20,250.00 15,000 185,148,919.80 137,147,348
18 April Increase (stock options)
737,572.50 546,350 185,886,492.30 137,693,698
28 April Increase (rights issue)
36,821,181.15 27,274,949 222,707,673.45 164,968,647
4 May Increase(stock options)
51,629.40 38,244 222,759,302.85 165,006,891
20 June Increase(stock options)
22,126.50 16,390 222,781,429.35 165,023,281
30 June 222,781,429.35 165,023,281

In January-June, the total number of Citycon shares traded on the Helsinki Stock
Exchange totalled 29.1 million (21.9 million) at a total value of EUR 108.4
million (EUR 58.3 million). The highest quotation was EUR 4.23 (EUR 3.09) and the
lowest EUR 3.02 (EUR 2.40). The reported trade-weighted average price was EUR
3.73 (EUR 2.66), and the share closed at EUR 3.61 (EUR 3.05). The company's
market capitalisation on 30 June 2006 totalled EUR 595.7 million (EUR 342.5
million).

Board authorisations

The AGM held in March authorised the Board of Directors to decide to increase
share capital through one or several rights issues by offering a maximum of
50,000,000 new shares at a nominal per-share value of 1.35 for subscription by
shareholders, i.e. the share capital may increase by a maximum total of EUR
67,500,000. The authorisation does not entitle the Board to deviate from the pre-
emptive subscription right of the shareholders. The Board exercised this
authorisation in March when it decided on a share issue based on the
shareholders' pre-emptive subscription right. Following the share issue, the
authorisation entitles the Board to increase the company's share capital by a
further EUR 30,678,818.85 at the most, by issuing a maximum of 22,725,051 new
shares. The authorisation is valid until 14 March 2007.

In addition, the AGM authorised the Board to decide to issue one or several
convertible bonds, issue stock options and increase the company's share capital
through one or several rights issues in such a way that, based on these issues,
the company's share capital may increase by a maximum of EUR 37,025,733 and that
a maximum of 27,426,468 new shares may be offered at a nominal per-share value of
EUR 1.35. Valid until 14 March 2007, this authorisation includes a right to waive
the shareholders' pre-emptive right to subscribe for company shares. Citycon may
not use these stock options as part of its employee incentive scheme.

More detailed information on the other decisions taken by the AGM is set out in
Citycon's interim report published on 27 April 2006.

Stock Options

Citycon has two option schemes in force, the 1999 A/B/C scheme and the 2004 A/B/C
scheme. Stock options attached to the 1999 stock-option scheme are listed on the
Helsinki Stock Exchange. These stock-option schemes form part of Citycon's Group-
wide employee incentive and commitment programme.

Citycon's stock options' terms and conditions were amended due to the rights
issue carried out during the reporting period in order to ensure equal treatment
of holders of Citycon stock options and shares. The amended terms and conditions
took effect on 24 March 2006. The table below shows a condensed summary of the
stock-option terms and conditions in force.

Under the company's 2004 stock option scheme, Citycon's Board of Directors
decided in April 2006 to grant a total of 1,250,000 C stock options to the
Group's employees. The subscription price of the C stock options, determined on
the basis of trading volume of Citycon share in April, is EUR 4.62. The
subscription price is decreased by half of the amount of distributed annual
dividends.

Citycon's Board of Directors has decided to transfer the 2004 stock options to
the book-entry securities system before the subscription period for 2004A stock
options begins on 1 September 2006. Furthermore, the Board has decided to apply
for the listing of the A stock options on the Helsinki Stock Exchange as of 1
September 2006.

1999 stock options
Number Subscription Subscription Subscription Subscription
ratio, stock price per period period ends
option/share share, EUR starts
1999A
1,800,000 1:1.0927 1.35 1 Sept. 2000 30 Sept. 2007
1999B
1,800,000 1:1.0927 1.35 1 Sept. 2002 30 Sept. 2007
1999C
1,727,500 1:1.0927 1.35 1 Sept. 2004 30 Sept. 2007
Not distributed
172,500 1:1.0927 1.35 1 Sept. 2004 30 Sept. 2007
Total
5,500,000

2004 stock options

2004A
1,040,000 1:1.0611 2.2336 1 Sept. 2006 31 March 2009
2004B
1,200,000 1:1.0611 2.6766 1 Sept. 2007 31 March 2010
2004C
1,250,000 1:1.0611 4.62 1 Sept. 2008 31 March 2011
2004A, not distributed
260,000 1:1.0611 2.2336 1 Sept. 2006 31 March 2009
2004B, not distributed
100,000 1:1.0611 2.6766 1 Sept. 2007 31 March 2010
2004C, not distributed
50,000 1:1.0611 4.62 1 Sept. 2008 31 March 2011
Total
3,900,000

In accordance with the amended terms and conditions, the 2004 stock options
entitle their holders to subscribe for a maximum of 4,138,290 shares, with the
result that the company's share capital may increase by a maximum of EUR
5,586,691.50.

Information on the share and stock option holdings of the members of Citycon's
Board of Directors and Corporate Management Committee can be found on the
company's website at www.citycon.fi. Further information on the company's stock
option schemes is available in the Financial Statements Appendix to the Annual
Report 2005, pages 8-9 and 26-28.

Events after the Period

On 16 June 2006, Citycon announced that it will buy the Columbus shopping centre
in Vuosaari, Helsinki. The transaction was finalised on 4 July 2006 for a debt-
free purchase price of EUR 80.1 million equalling approximately 5.8 per cent
initial net yield. The shopping centre will be extended by 7,500 sq.m.,
increasing the gross leasable area to around 20,000 sq.m.

In February, Citycon announced that it considers selling its non-core properties,
due to favourable market conditions and investor interest. On 20 July 2006,
Citycon signed an agreement to sell 76 non-core properties. Closing is expected
to take place by the end of September 2006. The debt-free sale price of the
properties is EUR 74 million. The fair value of the sold-off properties totalled
EUR 66.5 million on 31 March 2006 and EUR 67.9 million on 30 June 2006. Citycon
will book a gain on sale before taxes of EUR 6.1 million in the third quarter
provided that the closing of the transaction takes place in the planned schedule.
The gain on sale of EUR 7.5 million announced on 20 July 2006 was based on fair
values of the properties on 31 March 2006.

The positive impact of the transaction to the company's 2006 EPS is approximately
EUR 0.02 and to 2006 profit approximately EUR 2.5 million taking into account of
the gain on sale, transaction costs, lost net rental income for the fourth
quarter and taxes. The profit impact of EUR 3.8 million announced on 20 July 2006
was based on fair values of the properties on 31 March 2006. All of the sold-off
properties with a gross leasable area of 77,000 square meters are located in
Finland. After the transaction Citycon's Supermarkets and Shops portfolio will
consist of 51 properties in Finland.

A total of 269,433 new Citycon shares at a per-share nominal value of EUR 1.35
were subscribed in July, exercising stock options based on the 1999 A/B/C stock-
option scheme. The resulting share-capital increase of EUR 363,734.55 will be
registered in the Trade Register circa 27 July 2006 and the new shares should
become available for public trading on 28 July 2006.

The per-share subscription price of the shares subscribed with stock options was
EUR 1.35. The new shares will confer entitlement to dividend for the financial
year 2006. The other shareholder entitlements will come into force when the
increase in the share capital is registered. Each share entitles to one vote.

The unexercised stock options based on Citycon's 1999 stock-option scheme entitle
their holders to subscribe for a further 2,906,511 new shares, with the result
that the company's share capital may increase by a further EUR 3,923,789.85. The
share subscription period will expire on 30 September 2007.

After the increase, the registered share capital of Citycon Oyj is EUR
223,145,163.90 and the total number of shares 165,292,714.

Outlook

In its interim report published on 27 April 2006, Citycon said it expects the
demand, occupancy rates and rents for its retail premises to remain stable in the
Helsinki Metropolitan Area and Finland's major cities, as well as in Sweden and
Estonia. This outlook has not changed in the second quarter.

In the increasingly intensified competitive environment, the company continues to
seek out opportunities to expand its business in Finland, Scandinavia and the
Baltic countries.

Citycon's business risks relate to those associated with its lessees, customers,
property portfolio, price developments and business expansion, as well as
financial risks. However, due to favourable market prospects and acquisitions and
extension projects carried out in 2005 and 2006, Citycon expects growth in
business and operating results.

Condensed consolidated income statement, IFRS

EUR MILLION 4-6 4-6 1-6 % 1-6 % 1-12
2006 2005 2006 2005 2005

Gross rental income 26.7 20.6 52.8 96.0 41.3 97.2 89.1
Service charge income 1.1 0.7 2.2 4.0 1.2 2.8 3.1
Turnover 27.8 21.3 55.0 100.0 42.5 100.0 92.2
Property operating
expenses 8.1 5.5 15.9 28.8 11.1 26.1 24.7
Other expenses from
leasing operations 0.2 0.2 0.2 0.3 0.2 0.5 0.5
Net rental income 19.6 15.5 39.0 70.9 31.2 73.4 67.0
Administrative expenses 2.7 2.2 5.9 10.8 3.9 9.2 8.3
Other operating income
and expenses 0.1 0.2 0.3 0.5 0.2 0.5 0.3
Net fair value gains on
investment property 59.8 7.8 75.3 136.9 7.8 18.4 45.9
Net gains on sale of
investment property - - - 0.0 0.3 0.0 0.3

Operating profit 76.8 21.3 108.7 197.5 35.6 83.8 105.2

Net financial income and

Expenses 5.9 11.9 12.9 23.4 18.3 43.1 31.1
Profit before taxes 70.9 9.4 95.8 174.0 17.2 40.5 74.2
Current taxes -1.6 -3.2 -3.0 -5.5 -3.8 -9.0 -3.5
Change in deferred tax -15.5 1.3 -20.1 -36.6 -0.1 -0.2 -10.8
Profit for the period 53.7 7.5 72.7 132.0 13.3 31.4 59.8

Attributable to
Parent company
shareholders 54.3 7.5 72.4 0.0 13.3 0.0 59.2
Minority interest -0.6 - 0.2 0.0 - 0.0 0.6

Earnings per share
(basic), EUR 0.34 0.06 0.47 0.00 0.11 0.00 0.47
Earnings per share
(diluted), EUR 0.33 0.06 0.47 0 0.11 0.00 0.46

Condensed consolidated balance sheet, IFRS

EUR MILLION 30 June 30 June 31 Dec.
Assets 2006 2005 2005

Non-current assets
Investment property 1,143.2 754.7 956.6
Property, plant and equipment 0.7 1.1 0.7
Deferred tax assets - 3.8 -
Other non-current assets 0.4 0.0 0.2
Total non-current assets 1,144.3 759.6 957.6

Current assets
Trade and other receivables 8.6 5.2 9.9
Cash and cash equivalents 17.7 35.5 15.6
Total current assets 26.3 40.7 25.5

Total assets 1,170.6 800.4 983.1

Liabilities and Shareholders' Equity

Equity attributable to parent company shareholders
Share capital 222.8 151.6 184.1
Share issue - - 1.1
Share premium fund and other reserves 116.0 46.8 85.4
Fair value reserve -4.2 -17.8 -10.5
Treasury shares - - -
Retained earnings 156.7 50.3 96.5
Total equity attributable to parent
company shareholders 491.4 230.9 356.6
Minority interest 3.8 - 3.6

Total shareholders' equity 495.2 230.9 360.2

Liabilities

Long-term liabilities 542.7 534.5 542.7
Deferred tax liabilities 27.7 - 5.8
Total long-term liabilities 570.5 534.5 548.4

Short-term liabilities 104.9 35.0 74.4

Total liabilities 676.4 569.5 622.9

Total liabilities and
shareholders' equity 1,170.6 800.4 983.1

Condensed consolidated statement of changes in shareholders' equity, IFRS
EUR MILLION
Equity attributable to parent company shareholders

Share Share Share Fair Treasury Retained
capital issue premium value shares earnings
fund and reserve
other
reserves
Balance at
1 Jan. 2005 156.8 - 41.5 -13.3 -4.7 57.4
Cash flow hedges -4.5
Profit for the period 13.3
Total recognized
income and expense
for the period -4.5 13.3
Change in share
capital -5.2 5.2 4.7 -4.7
Dividends -15.7
Balance at
30 June 2005 151.6 - 46.8 -17.8 - 50.3

Balance at
1 Jan. 2006 184.1 1.1 85.4 -10.5 - 96.5
Cash flow hedges 6.3
Profit for the period 72.4
Total recognized
income and expense
for the period 6.3 72.4
Change in share
capital 38.7 -1.1 37.2
Dividends -6.6 -12.6
Other changes 0.4
Balance at
30 June 2006 222.8 - 116.0 -4.2 0.0 156.7

Equity Minority Shareholders'
attributable interest equity,
to parent total
company
shareholders
Balance at
1 Jan. 2005 237.7 - 237.7
Cash flow hedges -4.5 -4.5
Profit for the period 13.3 13.3
Total recognized
income and expense
for the period 8.8 8.8
Change in share
capital 0.0 0.0
Dividends -15.7 -15.7
Balance at
30 June 2005 230.9 - 230.9

Balance at
1 Jan. 2006 356.6 3.6 360.2
Cash flow hedges 6.3 6.3
Profit for the period 72.4 0.2 72.7
Total recognized
income and expense
for the period 78.8 78.8
Change in share
capital 74.8 74.8
Dividends -19.2 -19.2
Other changes 0.4 0.4
Balance at
30 June 2006 491.4 3.8 495.2

Condensed consolidated cash flow statement, IFRS
EUR MILLION 1-6 2006 1-6 2005 1-12 2005

Cash flow from operating activities
Profit before taxes 95.8 17.2 74.2
Adjustments -62.2 9.6 -14.1
Cash flow before change in
working capital 33.5 26.9 60.1
Change in working capital 0.0 1.9 1.9

Cash generated from operations 33.5 28.8 62.0

Paid interest and other
financial charges -17.0 -20.4 -32.3
Received interest and other
financial income 0.2 0.2 0.4
Taxes paid -2.1 -2.8 -5.2

Net cash from operating activities 14.7 5.8 24.8

Cash flow from investing activities
Acquisition of subsidiaries,
less cash acquired -66.7 -9.8 -92.6
Acquisition of investment properties -32.3 - -
Capital expenditure on investment properties,
PP&E and intangible assets -13.2 -1.6 -7.2
Sale of investment properties - 2.8 2.8
Proceeds from sale of other
investments - 1.0 1.0
Net cash used in investing
activities -112.1 -7.7 -96.1

Cash flow from financing activities
Proceeds from share issue 73.6 74.4
Proceeds from short-term loans 180.0 13.0 134.6
Repayments of short-term loans -132.0 -2.0 -108.6
Proceeds from long-term loans 30.0 169.7 199.7
Repayments of long-term loans -32.8 -135.5 -205.6
Dividends paid -19.2 -15.7 -15.7
Net cash from/used in financing
activities 99.6 29.5 78.9

Net change in cash and cash
equivalents 2.1 27.6 7.7
Cash and cash equivalents at
period-start 15.6 7.9 7.9
Effects of exchange rate changes 0.0 -
Cash and cash equivalents at
period-end 17.7 35.5 15.6

Segment information
EUR MILLION 4-6 4-6 1-6 1-6 1-12
2006 2005 2006 2005 2005
Turnover
Shopping Centres 18.9 12.6 37.3 25.3 57.4
Supermarkets and Shops 8.9 8.7 17.8 17.2 34.8
Unallocated - - 0.0 - -
Total 27.8 21.3 55.0 42.5 92.2

Operating Profit
Shopping Centres 64.5 12.9 86.8 22.0 61.2
Supermarkets and Shops 14.5 9.5 26.1 16.2 49.6
Unallocated -2.1 -1.0 -4.1 -2.6 -5.5
Total 76.8 21.3 108.7 35.6 105.2

Key financial figures
1-6 2006 1-6 2005 1-12 2005

Earnings per share (basic), EUR 0.47 0.11 0.47
Earnings per share (diluted), EUR
(EPRA EPS) 0.47 0.11 0.46
Equity per share, EUR (EPRA NAV) 2.98 1.94 2.45
Return on equity (ROE), % 35.0 11.2 22.5
Return on investment (ROI), % 20.4 9.5 13.5
Equity ratio, % 42.3 28.9 36.7

Investment property
1-6 2006 1-6 2005 1-12 2005
At period-start 956.6 738.7 738.7
Additions 109.9 11.6 175.4
Disposals - -3.4 -3.4
Net fair value gains 75.3 7.8 45.9
Exchange differences 1.3 - -
At period-end 1,143.2 754.7 956.6

Consolidated contingent liabilities
EUR MILLION 30 June 2006 30 June 2005 31 Dec. 2005
Mortgages on land and buildings 7.8 2.4 7.8

Group's derivative financial instruments
EUR MILLION 30 June 2006 30 June 2005 31 Dec. 2005
Nominal Fair Nominal Fair Nominal Fair
value value value value value value
Interest rate and
foreign exchange derivatives
Interest rate and currency swaps
Maturing in 2007 78.2 0.6 78.2 -1.5 78.2 -0.1
Maturing in 2008 50.0 -0.4 50.0 -2.9 50.0 -1.5
Maturing in 2009 143.9 -2.7 126.7 -10.1 125.3 -6.3
Maturing in 2010 83.0 -3.5 83.0 -9.6 83.0 -6.8
Maturing in 2010 40.0 0.0 - - - -
Total 395.1 -6.0 337.9 -24.1 336.5 -14.7

The fair values of derivatives reflect their values if all agreements were closed
at the market price at the end of the period.
Derivatives have been used for hedging the loan portfolio.
The fair values include an accrued interest of EUR 0.3 million (EUR 0.6 million)
for the period, which has been booked in interest expenses.
The fair values include the positive values of EUR 1.0 million (EUR 0.0 million)
and the negative values of EUR 7.0 million (EUR 24.1 million).

The figures are unaudited.

Accounting Principles

The accounting principles presented in the annual financial statements as of 31
December 2005 are applied in this interim report.

In the annual financial statements of 31 December 2005, Citycon changed its
procedures to calculate wholly owned, domestic real estate companies' deferred
tax liability on the temporary difference between the debt-free cost of these
companies' shares and their fair value.

The figures for the comparison period 1 January-30 June 2005 were changed to
comply with the new accounting practice.

Financial Reports in 2006

Interim report for 1 January-30 September 2006 will be released on 19 October
2006.

Further information for investors is available on Citycon's website,
www.citycon.fi.

Helsinki, 21 July 2006

CITYCON OYJ
Board of Directors

Further information:

CEO Mr Petri Olkinuora
Tel. +358 9 6803 6738, mobile +358 400 333 256
petri.olkinuora@citycon.fi

CFO Mr Eero Sihvonen
Tel. +358 9 6803 6730, mobile +358 50 557 9137
eero.sihvonen@citycon.fi

Distribution:
Helsinki Stock Exchange
Main media
www.citycon.fi

Report on the general review of Citycon Oyj's interim report for the period 1
January - 30 June 2006

We have generally reviewed the interim report of Citycon Oyj for the period 1
January - 30 June 2006. The Board of Directors and the Managing Director have
prepared an interim report in accordance with the Securities Market Act, chapter
2, paragraph 5. 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.

We conducted our general review in accordance with the International Standard on
Auditing applicable to general review engagements. This standard requires that we
plan and perform the review to obtain reasonable assurance as to whether the
financial statements are free of material misstatement. The general review is
limited primarily to inquiries of company personnel and analytical procedures
applied to financial data and thus provides less assurance than an audit. We have
not performed an audit and, accordingly, we do not express an audit opinion.

Based on our general review, nothing has come to our attention that causes us to
believe that the interim report does not give a true and fair view in accordance
with the Securities Market Act regarding the financial position of Citycon Oyj.

Helsinki, 21 July 2006

Ernst & Young Oy
Authorized Public Accountants

Tuija Korpelainen
Authorized Public Accountant