Slide 1: Q1 Presentation
Q1 Presentation Helsinki 26 April, 2007
Slide 2: Disclaimer
Disclaimer This document and the information contained herein is strictly confidential and is being provided to you solely for your information. This document may not be retained by you and neither this document nor the information contained herein may be reproduced, further distributed to any other
Slide 3: Contents
Contents Highlights Growth Goals and Key Strengths Financial Targets Property Portfolio Key Figures Development Projects Key figures Key Financials Profitability Columbus Columbus and and Financing and Debt Portfolio Torikeskus Torikeskus Finland Finland Share Performance and Owner
Slide 4: Highlights Q1/2007
Highlights Q1/2007 • Citycon Presentation • Q1 2007 4
Slide 5: Highlights – Geographic Overview
Highlights – Geographic Overview Geographical Overview Finland – 75 % of total net rental income in Q1/2007 Finland (€m) – Net rental income growth of 3.3%, to EUR 17.5m Sweden (€m) 1,046.6 – Net rental income for like-for-like properties rose 414.8 23.9 23.3 by 12.2%. 17.5 8.6 7.9 4.4 – One prope
Slide 6: Highlights – Focus on Development
Highlights – Focus on Development The market value of property portfolio EUR 1,546.9 Citycon’s Citycon’s Shopping Shopping million Centres Centres Two major development projects launched totalling approximately EUR 178 million Two significant property investments: Capital expenditure EUR 78.6
Slide 7: Highlights – Acquisition Track Record
Highlights – Acquisition Track Record Capital expenditure totalled EUR 78.6 million in Q1 120 104,5 100 1) 80,1 80 62,1 61,9 60,8 60 47,4 41,9 37,0 40 27,6 25,4 18,7 17,0 20 14,6 7,9 7,8 8,7 2,1 0 Karjalan Åkersberga Rocca al Mare Trio Lintulankulma/ Åkermyntan, Lindome 26 % of 57.4% ofBacka, Hindås
Slide 8: Highlights – Goals and Focus
Highlights – Goals and Focus Goals Growth Expand the property portfolio and increase its value Retail property management Property Development Sustained shareholder value Strategic focus Retail properties only Geographical focus; growing areas in Finland, Sweden and the Baltic Countrie
Slide 9: Highlights – Favorable Business Environment
Highlights – Favorable Business Environment Strong Growth in Real Gross Domestic Product Consumer Confidence at Record Levels Finland Sweden Estonia Lithuania 8,9% 9,1% 20 18 14 10 7,5% 10 16 18 6 6,8% 6 14 16 2 2 5,2% 12 4,5% -2 14 10 -2 3,5% -6 3,0% 2,7% 2,9% 8 2,5% 2,6% 2,6% 12 -10 -6 2,0% 2,0% 6
Slide 10: Highlights – Financial Targets
Highlights – Financial Targets Growth track Citycon launched two development projects totalling EUR 178 million Capital expenditure Q1 2007 Eur 78.6 million Citycon desires to maintain a solid dividend policy of distributing at least half of its distributable earnings after deduction of taxe
Slide 11: Property Portfolio
Property Portfolio • Citycon Presentation • Q1 2007 11
Slide 12: Property Portfolio – Key Figures
Property Portfolio – Key Figures Finland Q1/2007 Q1/2006 Turnover, EUR million 23.9 23.3 Net fair value gains on investment property, EUR million 14.0 14.9 Breakdown of property portfolio Operating profit, EUR million 30.2 30.7 Gross rental income, EUR million 23.3 22.7 Net rental income, EUR millio
Slide 13: Property Portfolio – Lease Portfolio
Property Portfolio – Lease Portfolio Lease portfolio summary Total Portfolio Q1/2007 Q1/2006 Number of leases started during the period 1) 114 122 Total area of leases started, sq.m. 17,960 39,465 3,387 (2,327) leases with an average length Occupancy rate at end of the period ,% 96.7% 96.7% Averag
Slide 14: Property Portfolio - Development Projects
Property Portfolio - Development Projects On-going development projects Market Area, Post- Total estimated Actual capital Targeted Additional Information value, sq.m. 1) development investment, by the end of year of EUR area, sq.m. EUR million 2) the period, completion million EUR million Property L
Slide 15: Property Portfolio - Development Projects
Property Portfolio - Development Projects Development projects under planning Citycon's Board of Directors has not yet made a decision on the development project, but it is under planning, an alteration of the city plan is pending or Citycon (or its partner) has a site reservation. Market value Proj
Slide 16: Property Portfolio - Development Projects
Property Portfolio - Development Projects Potential development project Citycon is analysing opportunities for the development and/extension of for example the properties below. Neither an alteration of the city plan has been applied nor any other official decisions made. Market value Area, sq.m. Ad
Slide 17: Key Figures
Key Figures • Citycon Presentation • Q1 2007 17
Slide 18: Key figures - Snapshot
Key figures - Snapshot Income Statement and Balance Sheet Income Statement , EUR million Q1/2007 Q1/2006 Gross rental income 32.8 26.1 Turnover 34.2 27.3 Net rental income 23.2 19.4 Net Fair value gains on investment property 31.5 15.5 Operating profit 50.4 31.9 Profit before taxes 40.9 24.9 Profit
Slide 19: Key Figures – Consolidated Cash Flow
Key Figures – Consolidated Cash Flow EUR MILLION Jan-Mar 2007 Jan-Mar 2006 Cash from operations reduced due Cash flow from operating activities Profit before taxes 40,9 24,9 to higher financial expenses paid Adjustments -21,7 -8,7 and negative working capital Change in working capital -5,1 -1,3 de
Slide 20: Key Figures - Net Rental Income
Key Figures - Net Rental Income Actual Q1 2006 vs. Actual Q1 2007 30 25 4.2 1.2 0.1 20 1.4 0.1 15 10 23.2 19.4 5 0 ) 006 i ons nd i a ent i ke min 007 1/2 isit i nla opm f or -L Ad 1/2 al Q cq u t (F e l ke - al Q Act u A n Dev Li Act u es tm e Value Div Change * The figures are rounded, EUR million
Slide 21: Key figures - Profitability
Key figures - Profitability Key Figures Q1 2007 Q1 2006 140 1 600 Equity ratio, % 45.5 33.8 1 500 120 Gearing, % 105.5 178.9 1 400 100 1 300 Earnings per share (basic), EUR 0.18 0.12 1 200 Earnings per share (diluted),EUR (EPRA EPS) 0.17 0.12 80 Earnings per share (basic), excluding the effects 1 10
Slide 22: Key Figures – NAV and EPS Evolution
Key Figures – NAV and EPS Evolution NAV versus Share EPS and Equity Ratio 6 0,80 50 5,5 5 0,70 45 4,5 0,60 40 4 35 0,50 3,5 30 0,40 € % 3 25 2,5 0,30 20 2 0,20 15 1,5 0,10 1 10 0,5 0,00 5 2006/Q1 2006/Q2 2006/Q3 2006/Q4 2007/Q1 0 -0,10 0 2006/Q1 2006/Q2 2006/Q3 2006/Q4 2007/Q1 EPS, € Equity ratio, %
Slide 23: Key Figures – Financing Overview
Key Figures – Financing Overview Maturity profile of loans and derivatives Interest-bearing debt by fixing type 2007 - 2016 EUR 804.1 million 1) 500 EUR 804.1m Floating rate debt Fixed rate debt 450 435 EUR 487.9m 16% 23% 400 EUR 50.0m 350 300 250 200 157 150 139 106 100 86 83 Fixed rate swaps 50 40
Slide 24: Key Figures - Debt Portfolio
Key Figures - Debt Portfolio Breakdown by debt type Breakdown by currency EUR 804.1 million 1) EUR 804.1 million 1) Other LTL 2% EEK 4% 11% CP’s 7% EUR Revolving credit facility Syndicated term loans SEK 60% 6% 54% 34% Bonds 22% The backbone of the debt financing continues to be the syndicated ter
Slide 25: Key Figures – Net Financial Expenses
Key Figures – Net Financial Expenses Net Financial Expenses (EUR million) 1q2007 1q2006 Change-% Financial Expenses: Interest expenses -9,6 -6,8 41,3 % Foreign exchange losses -0,1 -0,1 25,5 % Capitalised fees -0,1 -0,1 35,9 % Non-cash option expense from convertible bonds -0,4 0,0 n.m. Other expens
Slide 26: Key Figures – Share Performance
Key Figures – Share Performance 7 6 5 4 3 2 1 0 01-04 04-04 07-04 10-04 01-05 04-05 07-05 10-05 01-06 04-06 07-06 10-06 01-07 04-07 FTSE EPRA OMX Helsinki CAP Citycon • Citycon Presentation • Q1 2007 26
Slide 27: Key Figures - Share Data
Key Figures - Share Data Turnover and average price Breakdown of shareholders 250,0 6 5.3% 5 200,0 94.7 % 4 150,0 3 100,0 2 50,0 1 0,0 0 2005 2006/Q1 2006/Q2 2006/Q3 2006/Q4 2007/Q1 International Finnish Trading, M€ Average price, € Market capitalisation totalled EUR 1126.7 million on 31 March, 20
Slide 28: Backup Information
Backup Information • Citycon Presentation • Q1 2007 28
Slide 29: Business Environment – REIT Legislation
Business Environment – REIT Legislation Finland’s new right-wing Government stated in Government program in April the intention to review the legislation on real estate investment funds and adopt a new taxation policy for Finnish limited real estate funds to ensure their international competitiven
Slide 30: Business Environment – GDP Growth
Business Environment – GDP Growth Economic growth in Citycon’s core markets has been significantly above the European average and promises to stay at healthy levels in the foreseeable future Growth in Real Gross Domestic Product 8,9% 9,1% 7,5% 6,8% 5,2% 4,5% 3,5% 3,0% 2,7% 2,9% 2,5% 2,6% 2,6% 2,0% 2
Slide 31: Business Environment – Consumer Confidence
Business Environment – Consumer Confidence Consumer confidence at or close to record levels in all of Citycon’s markets provides a strong fundamental outlook for Citycon’s customer base Consumer Confidence Finland Sweden Estonia Lithuania 20 18 14 10 16 10 18 6 6 14 16 2 2 12 -2 14 10 -2 -6 8 12 -10
Slide 32: Business Environment – Private Consumption
Business Environment – Private Consumption Growth in private consumption has been considerably above the average for Europe, and consumption is forecast to continue this trend in 2007 and 2008 Private Consumption Growth 14,7% 9,8% 9,5% 7,5% 4,4% 4,0% 3,1% 3,5% 3,0% 3,0% 2,6% 2,4% 2,1% 1,4% 1,7% 1,8%
Slide 33: Citycon in Brief
Citycon in Brief Mission Demonstrating expertise in retail property business, Citycon not only owns, manages, leases and develops shopping centres and other retail properties but also develops new retail premises. Vision Citycon aims to expand its property portfolio and increase its value. The c
Slide 34: Citycon in Brief
Citycon in Brief • Citycon Presentation • Q1 2007 34
Slide 35: Citycon in Brief
Citycon in Brief Citycon’s path to becoming the market leader and an international property investment company 1988 2003 2005 Quoted on the Main List of Property portfolio expands Citycon enters foreign Helsinki Stock Exchange considerably markets by acquiring its Office portfolio Citycon’s
Slide 36: Citycon in Brief – Management
Citycon in Brief Management Petri Olkinuora, CEO Outi Raekivi Eero Sihvonen, CFO Head of Legal Affairs Kaisa Vuorio Ulf Attebrant Harri Holmström Vice President Vice President Vice President Finnish Operations Swedish Operations Baltic Operations • Citycon Presentation • Q1 2007 36
Slide 37: Latest Acquisitions
Latest Acquisitions Debt free purchase price Initial yield with transaction expenses on Post- (acquisition date exchange purchase acquisition Property Location Country rates) , EUR million GLA, total, m2 price, % Purchase date holdings, % Lindome Mölndal SWE 8.0 7 600 7.3% 3 January 100 Myyrmanni Va
Slide 38: Citycon Properties
Citycon Properties Liljeholmen Liljeholmen Sweden Sweden Tumba Tumba Centrum Centrum Sweden Sweden Trio Trio Finland Finland • Citycon Presentation • Q1 2007 38
Slide 39: Citycon Properties – Core shopping centres
Citycon Properties – Core shopping centres Lippulaiva Myyrmanni Trio Columbus Built 1993 1994 1977/87 1997/07 GLA 23.000 m2 40.200 m2 32.200 m2 20.400 m2 Owned 100 % 100 % 89.3 % 100 % Finland Koskikeskus Forum Isokarhu 1988 1953/91 1972/04 25.700 m2 17.400 m2 14.900 m2 88 % Citycon 69 % 100 % Jakob
Slide 40: Citycon Properties
Citycon Properties Torikeskus Torikeskus Lippulaiva Lippulaiva Finland Finland Finland Finland Lindome Lindome Sweden Sweden • Citycon Presentation • Q1 2007 40
Slide 41: Contact Information
Contact Information • Citycon Presentation • Q1 2007 41
Slide 42: Contact Information
Contact Information Investor Relations Mr Petri Olkinuora Koskikeskus Koskikeskus CEO Finland Finland Tel. +358 9 6803 6738 Fax +358 9 6803 6788 Petri.Olkinuora@citycon.fi Mr Eero Sihvonen CFO Tel. +358 50 5579 137 Fax +358 9 6803 6788 Eero.Sihvonen@citycon.fi Ms Hanna Jaakkola Investor Relations Of