NPRO 4Q 2013: Rental income and vacancy ratio temporarily affected by conversions

Conversion projects under way in the portfolio mean a high level of temporarily vacant space and a decline in rental income for several large properties. Rental income totalled NOK 169.5 million, yielding an operating profit before fair-value adjustments of NOK 121.4 million. After realised financial items, profit before fair-value adjustments came to NOK 21.5 million.

Negative fair-value adjustments for investment properties totaled NOK 54.7 million for investment properties, while negative fair-value adjustments for financial derivatives came to NOK 39 million. After NOK 12.9 million in tax income, the loss for the period came to NOK 56.6 million. This yielded negative ordinary earnings per share (EPS) of NOK 0.10 for the fourth quarter. Carried equity per share came to NOK 9.22 per share at 31 December 2013, down from NOK 9.32 per share at 30 September 2013 (Epra: NOK 10.07 at 31 December 2013).

As part of the group’s financing Norwegian Property has accepted an offer for an additional borrowing facility of NOK 600 million in the form of a revolving credit facility related to the existing borrowing facility with DNB and Danske Bank. The borrowing facility will be established during February 2014.

CEO Olav Line says in a comment: “After a period in the second half of 2013 with several refurbishment projects in parallel, it is a milestone that the annual rental run rate increases again as we gradually complete the ongoing projects. During the fourth quarter the annual rental run rate increased by NOK 47.2 million to NOK 732.8 million. The run rate will continue to increase at a significant rate also in 2014. In the first half year of 2015 we will see the full revenue effect of the then completed projects.

We continue to enter into new and important rental contracts. In the fourth quarter the largest contracts were entered into with the law firm DLA Piper DA and the Grieg Group. The high current pre let ratio of 74 per cent on Aker Brygge confirms that the market appreciate the future qualities of the major upgrade of Aker Brygge.”

The quarterly report for the fourth quarter 2013 is attached. Please also find attached the presentation material relating to the quarterly report.

Webcast link: http://webtv.hegnar.no/presentation.php?webcastId=19209808

This information is subject of the disclosure requirements according to §5-12 of the Norwegian Securities Trading Act (’Verdipapirhandelloven’).

For further information, please contact:

Olav Line, CEO

Telephone: +47 482 54 149

Email: ol@npro.no

Svein Hov Skjelle, CFO

Telephone: +47 930 55 566

Norwegian Property is a focused and fully integrated office property company with 41 properties located in the Oslo area and Stavanger in Norway. The portfolio, which has a total fair value of NOK 14.5 billion, is characterized by central location and attractive premises high quality tenants. The group’s properties consist largely of office premises, associated warehousing and car parking, as well as retail and catering space. The company has identified four value drivers for long-term value creation; Marketing & letting, Property management, Property development and Transactions & finance.

Norwegian Property is listed on Oslo Stock Exchange with the ticker NPRO.

www.npro.no