Interim Report, January - March 2002

PRESS RELEASE Profit after net financial income and expense, SEK 134.0 million · Profit after net financial income and expense for the period amounted to SEK 134.0 million (97.2). No items affecting comparability are included (18.7). · Profit after tax totalled SEK 93.9 million (71.6). · Net rents from property management increased by 14.5 per cent compared with the preceding year and the gross profit by 41.9 per cent, or 26.6 per cent excluding costs for special projects. · Stockholm, May 8, 2002 HUFVUDSTADEN AB (publ) Ivo Stopner President Enclosure: Interim Report, January - March, 2002. Questions will be answered by Ivo Stopner and Anette Ekstrand, telephone +46 8-762 90 00 HUFVUDSTADEN Interim Report, January - March 2002 · Profit after net financial income and expense for the period amounted to SEK 134,0 million (97.2). No items affecting comparability are included (18.7). · Profit after tax totalled SEK 93.9 million (71.6). · Net rents from property management increased by 14.5 per cent compared with the preceding year and the gross profit by 41.9 per cent, or 26.6 per cent excluding costs for special projects. · CONSOLIDATED RESULTS Property management 1) Gross profit for the period totalled SEK 183.3 million (129.2), an increase of 41.9 per cent. Excluding costs for special projects, the gross profit rose by 26.6 per cent. Net rents from property management during the year amounted to SEK 311.4 million (272,0), equivalent to an increase of 14.5 per cent. Of the net rents from property management, the Stockholm Business Area accounted for SEK 211.4 million (186.3), the NK Business Area for SEK 66.9 million (58.9) and the Gothenburg Business Area for SEK 33.1 million (26.8). Property management expenses for the period totalled SEK 128.1 million (142.8). Divided according to business area, the Stockholm Business Area accounted for SEK 75.2 million (92.6), the NK Business Area for SEK 43.1 million (36,5) and the Gothenburg Business Area for SEK 9.8 million (13.7). Of the total maintenance costs for the Stockholm Business Area, special projects accounted for SEK 2.9 million (14.2). The turnover-based rental supplement in the NK properties, which totalled SEK 20.1 million in 2001, is reported during the fourth quarter. Apart from this there are no seasonal variations. Other operations Other operations include parking operations at Parkaden in Stockholm, conference operations at the World Trade Center in Stockholm and hotel operations at Norrmalmstorg 1 in Stockholm. Net sales amounted to SEK 31.8 million (30.8), expenses amounted to SEK 26.7 million (24.8) and gross profit totalled SEK 5.1 million (6.0). Other income statement items Central administration totalled SEK -7.8 million (-8.8). Items affecting comparability totalled SEK 0.0 million (18.7). Net financial income and expense amounted to SEK -46.6 million (-47.9). The Group's tax (both paid and deferred) for the period totalled SEK - 40.1 million (-25.6). SPECIAL PROJECTS Special projects refer to expensed measures taken to improve and develop the properties. The costs that arise in conjunction with this are in the short term a charge on profit. In the long term, however, special projects increase the return on property holdings. The profit for the period was charged with costs of the above nature amounting to SEK 3.5 million (18.4). The costs refer mainly to planning of Norrmalmstorg 1 and reconstruction of the lower floor of NK Stockholm. Norrmalmstorg 1 was acquired in 2000. Extensive upgrading and rebuilding of the property will take place, beginning in summer 2002. Extensive rebuilding of the lower floor of NK Stockholm has commenced with the aim of improving accessibility and creating a wider range of shops. Rebuilding will continue throughout most of 2002. During the remainder of the year the profit will be charged with a higher cost per quarter for special projects. INVESTMENTS Investments in properties and equipment during the period totalled SEK 14.9 million (51.8). The largest single items are planning of Norrmalmstorg 1 and reconstruction of the lower floor of NK Stockholm. PROPERTY PORTFOLIO The book value of Hufvudstaden's property portfolio as at March 31, 2002 was SEK 10,552.4 million (10,562.6 at the turn of the year) and the rentable space was 434,648 square metres (434,562 at the turn of the year). The total floor space vacancy level as at March 31 was 5.2 per cent (3.9 at the turn of the year) and the total rental vacancy level was 5.5 per cent (3.9 at the turn of the year). The increase is due mainly to the release of floor space in the project property Norrmalmstorg 1 and a weak new lease market. It is estimated that vacancies will continue to increase during the year. THE RENTAL MARKET Market rents for office space in central Stockholm fell during the period, mainly as a result of the continued weak growth in the economy and an increasing level of vacant space. Despite this, rents of SEK 4,000-5,000 per square metre per year, excluding the property tax supplement, were noted for new leases for office space in the most attractive locations in Stockholm, within the Golden Triangle. In the same area there was a strong demand for retailing space although available floor space was virtually non-existent. Rent levels of SEK 10,000-12,000 per square metre per year, excluding the property tax supplement, were noted. Interest in modern office and retailing premises in the most sought- after locations in Gothenburg continues to be stable. On the office market there is a balance between supply and demand whilst the level of vacant space in the most attractive areas is low. Market rents for prime location office space were between SEK 1,600 and 2,000 per square metre per year, excluding the property tax supplement. Market rents for store premises continue to be good. Market rents for prime site retailing space are between SEK 5,000 and 8,500 per square metre per year, excluding the property tax supplement. FINANCING STRUCTURE Hufvudstaden's borrowing as of March 31, 2002 amounted to SEK 3,946.5 million (4,061.6 at the turn of the year). The average fixed interest period was 26 months (28 at the turn of the year), the average capital- tie period was 27 months (25 at the turn of the year) and the average interest rate on borrowings was 5.0 per cent (5.0 at the turn of the year). Net liabilities amounted to SEK 3,842.0 million (3,923.5 at the turn of the year). PARENT COMPANY The profit for the period after net financial income and expense was SEK 79.1 million (-180.9). Liquid funds at the period-end amounted to SEK 87.6 million (127.3 at the turn of the year). Investments in properties and equipment during the period amounted to SEK 6.8 million (46.1). ACCOUNTING PRINCIPLES This Interim Report has been prepared in accordance with recommendation RR20 Interim Reports, issued by the Swedish Financial Accounting Standards Council. Compared with the 2001 Annual Report, the following new recommendations have been applied since January 1, 2002: RR1:00 Consolidated Accounts, RR15 Intangible Assets, RR16 Provisions, Contingent Liabilities and Eventuality Assets and RR17, Write-downs. The application of these re- commendations has not had any material impact on the Company's financial results and position. In other respects, the same accounting principles have been applied as in the annual report for the preceding year. FORTHCOMING INFORMATION Interim Report, Jan-June 2002 August 26, 2002 Interim Report, Jan-Sept 2002 Oktober 22, 2002 Year-end Report 2002February 13, 2003 Annual Report 2002March 2003 This information is also published on Hufvudstaden's website, www.hufvudstaden.se Stockholm, May 8, 2002 Ivo Stopner President This Interim Report has not been the subject of an examination by the Company's auditor. DEFINITIONS Central administration. Costs for Group management and Group staff functions, costs for maintaining the Company's stock exchange listing and other costs common to the Company. It should be noted that Central administration attributable to Other operations is included in the Other operations item. Equity per share. Equity in relation to the number of shares at the period-end. Equity ratio. Equity at the period-end in relation to total assets. Floor space vacancy level. Total vacant floor space in square metres in relation to the total rentable floor space. Golden Triangle. The central business district in Stockholm, between Stureplan, Norrmalmstorg and Nybroplan and bordered by Birger Jarlsgatan, Norrlandsgatan and Hamngatan. Investments. Expenses related to planned maintenance, adaptation of premises and special projects, capitalized or expensed in accordance with tax legislation. Net liabilities. Interest-bearing lialibities less interest-bearing assets. Profit per share for the period. Profit for the period in relation to the average number of outstanding shares during the period. Property tax supplement. Property tax payments received from tenants. Rental vacancy level. Vacant floor space at an estimated market rent in relation to the total annual rent. Tax. Total tax for the Group comprises both paid tax and deferred tax. Hufvudstaden AB (publ) NK 100, SE-111 77 Stockholm Visiting address: Regeringsgatan 38 Telephone: +46 8-762 90 00 Fax: +46 8-762 90 01 E-mail: info@hufvudstaden.se Website: www.hufvudstaden.se Company registration number: 556012-8240 Registered office: Stockholm The property holdings remained unchanged between the first quarter of 2001 and the first quarter of 2002. ------------------------------------------------------------ This information was brought to you by Waymaker http://www.waymaker.net The following files are available for download: http://www.waymaker.net/bitonline/2002/05/08/20020508BIT00330/wkr0001.doc The full report http://www.waymaker.net/bitonline/2002/05/08/20020508BIT00330/wkr0002.pdf The full report