Year-End Report 1998

Year-End Report 1998 www.scandic-hotels.com 1998 in brief * Income after net financial items rose by 60 per cent to SEK 274 million (171m). Adjusted for an item affecting comparability, earnings improved by 71 per cent to SEK 293 million (171m). * Sales rose by 35 per cent to SEK 5,004 million (3,697m). For comparable units, sales rose by 8 per cent, due to an increase in volumes and average room revenues. * The operating margin rose to 6.2 per cent (5.2%) and the return on equity was 19 per cent (24%). Adjusted for an item affecting comparability, the operating margin was 6.5 per cent. * A total of 22 hotels were added to the Group's portfolio during the year, including 20 in Finland. This corresponds to a 20 per cent increase in room capacity. * In conjunction with the acquisition of the Finnish hotel chain Arctia a new share issue, at the value of SEK 783 million, was carried out. * An agreement has been reached regarding the sale of the majority of independent restaurants taken over as part of the acquisition of the Finnish hotel chain, Arctia. The transaction will be completed during the first quarter of 1999. * At the beginning of the year, Scandic formed the property company Hotellus International, to which the company's five properties were transferred. Hotellus has since expanded and now owns 14 hotel properties with a book value of SEK 1,700 million. During the period, Scandic gradually reduced its ownership interests in the company from 100 per cent to 49.9 per cent. * The cash flow amounted to SEK 127 million (175m). Adjusted for acquisitions and sales of fixed assets, the cash flow amounted to SEK 255 million (158m). * Earnings per share amounted to SEK 9.79 (8.10). Adjusted for an item affecting comparability, earnings per share amounted to SEK 10.69. ------------------------------------------------------------ Please visit http://www.bit.se for further information The following files are available for download: http://www.bit.se/bitonline/1999/02/08/19990208BIT00300/bit0001.doc http://www.bit.se/bitonline/1999/02/08/19990208BIT00300/bit0002.pdf