Interim Report, 1 January - 30 June 2000

Interim Report, 1 January - 30 June 2000 * Management profit rose by nearly 30 per cent to SEK 60m (47m). * Pre-tax profit amounted to SEK 91m (90m), of which profits from property sales made up 27m (34m). * Mandamus has expanded its operations in Greater Stockholm through the acquisition of four housing properties comprising 590 flats in Åkersberga. * The company's ongoing concentration and increasing focus means that 90 (81) per cent of the property stock is now located in Mandamus' selected areas. The proportion of housing properties continues to rise, and is now 82 (75) per cent. * In June, Mandamus bought back 624,400 of its own shares, corresponding to more than 3 per cent of outstanding shares. * The forecast for pre-tax profit for the year has been adjusted upwards by SEK 10m to SEK 155m. Mandamus is a property company that seeks to own, develop and manage a stock of high-yield, low-risk properties. The aim is for the property stock to be located in growth areas in Southern and Central Sweden, with residential properties making up at least 80%. Mandamus owns properties with a book value of some SEK 5,500m, with annual rental income of around SEK 830m. OPERATIONS IN THE FIRST HALF OF 2000 Continued focus on housing and concentration in growth areas Mandamus is continuing to focus its operations on residential properties, with the emphasis on areas of strong growth. This concentration of activities is reducing the group's operating risk, which permits lower equity ratio. The aim is to keep an equity ratio of at least 20 per cent. For the purpose of consolidating this focus on growth areas, acquisitions in suburbs of Stockholm and Gothenburg -- five properties containing more than 650 flats -- took place during the first half of the year. During this period 49 properties were sold, further concentrating the property stock in metropolitan areas and housing properties. At 30 June, 61 per cent of Mandamus' stock of flats was located in the metropolitan areas of Stockholm, Gothenburg and Malmö/Lund. Residential Enhancement Co-operation with Telia continues to develop well. In Borås, Mandamus' apartment buildings have now obtained access to ADSL broadband technology, and tenants' interest in getting connected has exceeded expectations. Installation of broadband in co-operation with Telia is now to be carried out, in the immediate future, in Lund and Trollhättan. This venture with Telia is among those that benefit Mandamus' tenants within the framework of Residential Enhancement. Co-operation with Birka Energi, another example, is presented in detail elsewhere in this interim report. Rent and profit trends Rental income amounted to SEK 408m (389m), just under 5 per cent up on the previous year. The average economic letting ratio for the period was 96.7 per cent, which is 1.2 percentage points higher than at year-end and 2.1 percentage points higher than the corresponding period in 1999. Net of property costs, trading profit was SEK 197m (187m). Depreciation on the properties amounted to SEK 24m (23m) and central administrative expense to SEK 10m (18m). Compared with the previous year, the administrative expense attributable to operations was roughly SEK 12m higher on an annual basis. Interest expense totalled SEK 104m (100m). Management profit, i.e. profit before items affecting comparability, amounted to SEK 60m (47m), corresponding to a gross margin of 14.7 (12.1) per cent. Management profit for the (rolling) past 12-month period was SEK 128m, which represents an improvement of SEK 13m compared with the figure for the 1999 financial year. The diagram below shows quarterly management profit and rolling 12-month profit. ------------------------------------------------------------ This information was brought to you by BIT http://www.bit.se The following files are available for download: http://www.bit.se/bitonline/2000/08/10/20000810BIT00350/bit0001.doc The full report http://www.bit.se/bitonline/2000/08/10/20000810BIT00350/bit0002.pdf The full report