Year-end report January - December 2002

Total property revenue for 2002 amounted to SEK 562.2 M (575.1). The decrease in revenues is due to a weaker hotel market, but in which the Pandox hotel property portfolio has performed better than the market in general. For comparable units the decrease was 2.0 per cent. The operating net decreased by SEK 9.4 M to SEK 469.0 M (478.4).   The direct yield for the period, adjusted for properties bought and sold, was 9.4% (9.6). Net financial expense for the period amounted to SEK -171.0 M (-178.1). Corporate group income, after tax, exclusive of nonrecurring revenue and the tax effects thereof, for the period decreased by SEK 13.7 M and amounted to SEK 168.4 M (182.1) corresponding to SEK 6.76 (7.31) per share.   The Board of Directors have at today's board meeting decided to change the dividend policy to the payment of a dividend of approximately 50 per cent from current operations after paid tax. Furthermore, the Board of Directors will, for future dividend payments, consider the development possibilities, investment needs and financial situation of the company.   As part of Pandox' strategy to concentrate on hotel properties in its priority segments and locations,  the hotel properties First Hotel Jörgen Kock in Malmö and Scandic Hotel Säffle were divested with a total capital gain of SEK 28.8 M. As per December 31, 2002 Pandox owned 44 hotel properties with a total of 8 295 rooms and a book value, including hotel inventory, of SEK 4,961.3 M.   "Despite the global uncertainty, 2002 became a good year with continued stable cash flow. Pandox' focused strategy, the high quality of its hotel property portfolio and active ownership has limited the risks", says Anders Nissen, CEO, Pandox AB.