Citycon Oyj's Interim Report for 1 January - 31 March 2008

CITYCON OYJ Stock Exchange Release 24 April 2008 at 9.00 hrs Summary of the First Quarter of 2008 Compared with the Previous Quarter   - Turnover increased by 2.3 per cent, to EUR 44.3 million (Q4/2007: EUR 43.3 million). - Net rental income grew by 9.5 per cent, to EUR 29.7 million (EUR 27.1 million). - Net cash from operating activities per share was EUR 0.06 (EUR 0.06). - Earnings per share remained at EUR 0.04 (EUR 0.04). - Direct earnings per share were EUR 0.04 (EUR 0.06). The decline was due mainly to positive tax effect during the comparison period. - Operating profit including the fair value changes rose to EUR 27.4 million (EUR 24.5 million). - The fair value change of investment properties was positive by EUR 1.4 million (EUR 0.7 million) due to higher net rental income and despite the increased average net yield requirement. The fair market value of investment properties grew to EUR 2,226.6 million (EUR 2,215.7 million). The average net yield requirement for investment properties was at 5.7 per cent (5.6 per cent) at the end of the reporting period, according to an external appraiser. - Net financial expenses came to EUR 16.1 million (EUR 14.5 million). The period's net financial expenses include EUR 1.4 million (EUR 0.2 million gain) one-off, non-cash expense resulting from the quarterly valuation of the company's interest rate hedging contracts, mainly due to the decline of long-term interest rates. - In February, Citycon sold 40 per cent of its holding in the Iso Omena shopping centre to the Singaporean GIC Real Estate, for EUR 131.6 million. The purchase price corresponded to the price Citycon paid for Iso Omena in September 2007.   Summary of the First Quarter of 2008 Compared with the Corresponding Quarter of 2007   - Turnover increased by 29.3 per cent, to EUR 44.3 million (Q1/2007: EUR 34.2 million), mainly as a consequence of new property acquisitions carried out during 2007. - Profit before taxes decreased to EUR 11.3 million (EUR 40.9 million), including a EUR 1.4 million (EUR 31.5 million) increase in the fair value of investment properties. - The company's direct result rose to EUR 9.5 million (EUR 6.7 million), up mainly because of business expansion, decreased administrative expenses and lower taxes than during the reference period. - Direct result per share was EUR 0.04 (EUR 0.04). - Earnings per share came to EUR 0.04 (EUR 0.18). The decrease resulted from greater changes in the fair value of properties during the reference period and the higher number of shares. - Net rental income increased by 28.0 per cent, to EUR 29.7 million (EUR 23.2 million). - Net rental income for like-for-like properties rose by 3.1 per cent. - Net cash flow from operating activities per share rose to EUR 0.06 (EUR 0.05). - - The equity ratio was 43.0 per cent (45.5%). - At the beginning of the year, Citycon announced its commitment to sustainable construction, with its key pilot project being the Liljeholmstorget shopping centre underway in Stockholm. - Citycon signed two long-term loan agreements on competitive terms: a loan agreement for 280 million Estonian crowns (approx. EUR 17.9 million) and a credit facility of EUR 50 million, resulting in total liquidity of EUR 332.8 million including unutilized committed debt facilities amounting to EUR 282.1 million and cash EUR 50.7 million.   CEO Petri Olkinuora comments on the beginning of 2008:   "Turnover and net rental income continued to grow, and direct result as well as cash flow from operating activities performed well. The growth in net rental income was also reflected in the increased fair market value of our properties.   Citycon is an expert in asset management and property development. Our development and redevelopment projects progressed as planned, the main projects including Liljeholmstorget shopping centre in Stockholm, Rocca al Mare in Tallinn and Trio in Lahti. Sustainable construction plays a more and more emphasized role in our development and redevelopment activity and we are seeking for an international LEED certification for our main projects. It is my belief that in the future customers are increasingly interested in modern shopping centres focused in green values. It is also a question of a new way of competing providing us with another competitive edge in a current market."   Outlook   Citycon will continue to focus on increasing net operating income and cash flow. The company expects the development and redevelopment projects to continue to play an important role in its business for the current financial year. The company will continue to focus on developing and redeveloping its shopping centres while also seeking to implement its expansion strategy through selected acquisitions. Citycon is also considering the divestment of its non-core properties - such as, its residential properties in Sweden.   The company expects its net rental income and direct operating profit excluding fair value changes to increase in the course of the financial year. The estimate is based on the property portfolio's growth, on investments in shopping-centre management and on expansion and redevelopment projects coming on stream.   The entire report with tables in pdf-format can be downloaded from the link below.   Helsinki, 23 April 2008   Citycon Oyj   Board of Directors   Financial reports in 2008   In 2008, Citycon will publish another two interim reports as follows:   January-June 2008 on Friday, 18 July 2008, and January-September 2008 on Thursday, 16 October 2008.   For further information, please contact: Mr Petri Olkinuora, CEO Tel. +358 9 6803 6738 or +358 400 333 256 petri.olkinuora@citycon.fi   Mr Eero Sihvonen, CFO Tel. +358 9 6803 6730 or +358 50 557 9137 eero.sihvonen@citycon.fi   Distribution: OMX Nordic Exchange Helsinki Major media www.citycon.fi