Citycon's first half pre-tax profit rises to EUR212.5m

Finland's Citycon said that its pre-tax profit for the first six months of 2007 rose to EUR 212.5 mln, up from EUR 95.8 mln for the same period last year, helped by an EUR 191.6 mln increase in the fair value of investment properties. Turnover in the period rose 27.5% to EUR 70.2 mln, due mainly to property acquisitions, while reported net rental income increased by 25.6% to EUR 49 mln. Rental income of like-for-like properties increased by 8.8% in the first six months of the year.

Among other first-half figures released, Citycon noted that earnings per share rose to EUR 0.90 from EUR 0.47, although earnings per share excluding the effects of fair value changes fell to EUR 0.08 from EUR 0.10. The fall was explained by a one-time exchange rate gain in the comparison period, along with the divestment of non-core properties, a higher number of shares along with increased development activities and costs related to the expansion of business operations. Per share net asset value grew to EUR 4.42 from EUR 2.98. The occupancy rate for properties was strong at 95.8%, although Citycon noted it suffered from an increase in the number of premises temporarily vacated for redevelopment projects.

'I am delighted with the level of activity in development and redevelopment, which is a direct execution of our strategy and will lead to strong internal growth and improved quality of our portfolio,' Citycon ceo Petri Olkinuora said in a statement. 'We are seeking better long-term return from development projects compared to acquisitions.' Olkinuora added that there are currently 6 major development and redevelopment projects underway, with total investments of about EUR 340 mln. At the beginning of July, Citycon was upgraded from mid cap to large cap company on the Nordic Exchange based on its market capitalisation in May.