Q3 Third quarter 2011 results Q3 2011

Highlights in the third quarter 2011

• Operating revenues were NOK 684*) million for the quarter and EBITDA amounted to NOK 125*) million • 247 units were sold during the quarter, and a total of 504 units have been sold so far in 2011 • Sales commenced on 130 properties in the quarter: 47 flats in Bjørnåsen, 30 terraced houses in Skullerudlia, 34 flats in Kjørbo in Sandvika, and 19 terraced houses at Lervik Brygge in Stavanger • Work commenced on 100 flats during the quarter • In total the company had 995 flats under construction at the end of September 2011 • Selvaag Bolig ASA has reached agreement with the other shareholders in Bo En AS for Selvaag Bolig ASA to acquire 37.5% of the shares in the company • The merger with Hansa Property Group AS and private placement to participants in Selvaag Pluss Eiendom KS was undertaken in August 2011

*) The operating figures are based on internal segment and operating reports that differ from consolidated accounting figures

(IFRS)

Key figures

(figures in NOK 1 000) Q3 2011 Q3 2010 9M 2011 9M 2010 2010 IFRS main figures Operating revenues 37,066 78,643 142,499 282,373 379,130 Operating profit/loss 63,340 -6,806 41,933 6,810 20,726 Profit/loss before taxes 32,875 -11,041 8,422 -7,464 -2,530

Cash flow from operating activities -27,791 18,265 -57,739 2,869 28,580 Net c ash flow 356,872 19,447 369,260 26,372 9,197 Interest-bearing liabilities 2,825,435 657,594 2,825,435 657,594 627,901 Total assets and liabilities 4,431,502 1,139,918 4,431,502 1,139,918 1,082,170 Equity ratio 28.2 % 28.3 % 28.2 % 28.3 % 29.8 % Earnings per share (whole NOK) 2.24 -137,352 1.28 -141,413 -163,230

Segment reporting: Operating revenues 684,058 57,301 784,824 164,747 241,993 EBITDA 124,694 8,034 105,927 9,008 26,323 EBITDA margin 18.2 % 14.0 % 13.5 % 5.5 % 10.9 %

Key figures: Number of sold units 247 79 504 266 388 Number of commenced units 100 116 678 116 354

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Q3 2011

Financial review

The third quarter of 2011 is the first quarter when Hansa Property Group and SPE KS have been consolidated in Selvaag Bolig ASA.

The third quarter of 2011 is not directly comparable with the previous year and the prior quarter because projects have previously been owned through part-ownership (associated companies), while the majority of the projects are now consolidated into the accounts.

Operating revenues Results (figures for the corresponding period last year are shown in The group’s operating profit for the quarter amounted to parentheses) NOK 63.3 million (-6.8). For the first nine months of 2011 the operating profit was NOK 41.9 million (6.8). Selvaag Bolig did not supply properties from its projects in the third quarter 2011. Therefore in accordance with the Net financial income (expenses) totalled NOK – 30.5 million accounting standards of the IFRS no proceeds from the sale for the period (-4.2) and NOK -33.5 million for the first nine of properties in the quarter have been recognised in the months (-14.3). income statement. The income tax expense for the quarter was NOK 10 million The final operating revenue figure of NOK 37.1 million (-2.7) and for the first nine months came to NOK 16 million (78.6) in the quarter is due to activities outside the core (-6.7). business, principally within estate agency services and Modul. The decline in operating revenue is due to the The group’s net income totalled NOK 42.9 million (-13.7) business area Modul having made more deliveries to and NOK 24.4 million for the first nine months (-14.1). external parties in 2010, whereas over the coming years Modul will largely earn revenues from internal projects that will be eliminated from the consolidated accounts. Cash flow The group’s net cash flow from operating activities was NOK Operating revenues for the first nine months of the year -28.8 million for the quarter (18.3). The profit before taxes were NOK 142.9 million (282.4). This performance is for the quarter of NOK 32.9 million was an increase of NOK explained by the same aforementioned circumstances. 43.9 million compared with the same period last year (-11). The profit includes group gains of NOK 77.2 million from gradual acquisitions that have not had an effect on cash Operating expenses flow. Changes in working capital gave an increase in cash Total operating expenses (excluding profit from associated flow of NOK 13 million. companies and losses) were NOK 48.3 million (64.9) during the quarter. Expenses have fallen as a result of gradually Net cash flow from investing activities was NOK 93.5 million phasing out external Modul deliveries. for the quarter (-6.1). Cash in acquired businesses represented NOK 270.8 million, partly offset by loans taken During 2011 Selvaag Bolig has increased the promotion of over and additions of associated companies. the group as Norway’s largest property developer in step with the sales start of several projects. In addition the Net cash flow from financing activities amounted to NOK group has prepared for its stock exchange listing and 292.2 million. Net new borrowings represented NOK 186.1 merged with Hansa Property Group. This has led to an million, while receipts from share issues in SPE KS totalled increase in the item ”other operating expenses” to NOK NOK 106 million. 16.4 million in the quarter (6.6) and NOK 48.7 for the first nine months of the year (30.5). This resulted in an increase in cash and cash equivalents during the period of NOK 356.9 million (19.5). The item “gains (losses), net associated companies and joint ventures” includes gains of NOK 77.2 million resulting from gradual acquisitions in connection with the merger Financial position with Hansa Property Group and a private placement to SPE At the end of the third quarter Selvaag Bolig’s inventories KS. These are simply gains for accounting purposes on (plots of land and properties under construction) had a book interests owned prior to the transactions noted here. value of NOK 3,027.0 million compared with NOK 375.4 million at the end of the second quarter and NOK 365.8 million at the end of the previous year. The amount has

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Q3 2011

risen substantially as a result of the merger with Hansa as an equity bridge and is scheduled to be paid off in Property Group and SPE KS, while high rates of construction connection with the stock exchange listing of Selvaag Bolig. activity in several projects have boosted the value of these In addition the group has established a new land loan of during the quarter. NOK 550 million allocated across eight different plots of land. This loan will be converted to a construction loan in Equity was NOK 1,255.1 million at the end of the third step with the development of the individual projects. quarter, equivalent to an equity ratio of 28.3 %. The group also has a bank overdraft facility of NOK 150 The group held cash and cash equivalents valued at NOK million for funding the start-up phase of new projects. 382.8 million as at 30 September 2011. In Selvaag Bolig every project is placed in its own separate The merger with Hansa Property Group and increased company, a single purpose vehicle (SPV). In addition to construction activity on projects also increased liabilities in financing in the parent company, this involves each of the Selvaag Bolig ASA’s balance sheet during the period. At the companies in seeking loan capital in connection with end of the quarter the group had NOK 2.2 billion in non- development of a project. The land loans will be converted current interest-bearing liabilities (0.0) and NOK 603.9 to construction loans gradually as the projects are started. million in current interest-bearing liabilities (643.7). The construction costs are 100 % loan financed and increased activity in the companies will therefore lead to Moreover Selvaag Bolig ASA was refinanced in connection increases in the construction loans in line with the with the merger with Hansa Property Group AS in August development. 2011. The board considers the current financial position to be The company currently has an unsecured credit facility of satisfactory. NOK 500 million in the parent company. This loan is defined

Net interest-bearing liabilities

(figures in NOK 1 000) 30.09.2011 30.06.2011* Non-current interest-bearing group liabilities 2 221 498 9 115 Current interest-bearing group liabilities 603 937 712 428 Total bank deposits and cash -382 785 Net interest-bearing liabilities 2 442 651 721 543

* Hansa and SPE KS became legally part of Selvaag Bolig on 22 August 2011

Source: Selvaag Bolig ASA

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Q3 2011

Operating reports

Operating reports follow the segments defined in Selvaag Bolig and are divided up as follows: Property development apportioned geographically in to Greater Oslo, The rest of Norway and Other countries. An additional segment “Other” is also reported on. The segment “Other” contains the estate agency business in Selvaag, Modul, services and administration that is not allocated to other segments due to its size. Note 4 to the accounts shows segment information reconciled against the accounting figures (IFRS). IFRS follows the completed contract method where revenue is recognised on delivery, while the segments (including operating reports) focus on value creation during the period.

Segments 3rd quarter

Operating revenues EBITDA Operating profit/loss (figures in NOK 1 000) Q3 11 Q3 10 Q3 11 Q3 10 Q3 11 Q3 10 Property development - Greater Oslo 523 601 3 563 121 350 6 459 111 226 21 836 - The rest of Norway 131 888 - 14 563 - 10 001 - - Other countries 1 155 - 872 - 245 - Other 27 414 53 963 (12 091) 5 033 (23 787) 18 874 IFRS adjustments (646 992) 21 117 (134 972) 2 320 (34 345) (47 516) Total group 37 066 78 643 (10 278) 13 812 63 340 (6 806)

Source: Selvaag Bolig ASA

Segments first 9 months

Operating revenues EBITDA Operating profit/loss (figures in NOK 1 000) Jan-Sep '11 Jan-Sep '10 Jan-Sep '11 Jan-Sep '10 Jan-Sep '11 Jan-Sep '10 Property development - Greater Oslo 523 601 17 873 121 350 11 105 111 226 33 808 - The rest of Norway 140 356 - 17 419 - 12 857 - - Other countries 1 155 - 872 - 245 - Other 119 712 147 948 (33 714) (2 097) (32 634) 19 991 IFRS adjustments (641 874) 116 552 (129 972) 28 147 (49 761) (46 989) Total group 142 950 282 373 (24 045) 37 155 41 933 6 810

Source: Selvaag Bolig ASA

Property development - Greater Oslo The segment includes projects within the area from The operating expenses including construction costs follow Jessheim in the north, Moss in the south east to Tønsberg in the projects and totalled NOK 402.3 million in the third the south west. quarter. Construction costs exclude financial expenses.

Operating revenues in the third quarter were NOK 523.6 EBITDA is the earnings before interest, taxes, depreciation million (NOK 3.5 million compared with the same period and amortisation. The operating profit of NOK 121.4 million last year). The revenues originate from eight different (6.5) is due to the projects having achieved a robust projects on which construction work has commenced in number of advanced sales, as well as making good progress 2011. on the projects with expenses fixed at satisfactory levels. A large portion of the sales costs have already been expensed in the projects. From the third quarter 2011 onwards these

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Q3 2011

costs will be consolidated. The margin for the quarter alone operating expenses totalled NOK 0.3 million for lease is therefore higher than what the projects will achieve as a management. whole over their durations. Other - Unallocated Property development – The rest The segment is composed of several activities in the group of Norway that viewed in isolation do not represent core activities, are not sufficiently large or are not followed up internally. In addition to Greater Oslo and central Eastern Norway, In addition the segment includes administration and Selvaag Bolig also focuses on large cities in other parts of management which cannot be attributed to the projects the country. The business area "Property development – The directly and are therefore not allocated to the main rest of Norway" includes these. segments.

The operating revenues in the third quarter totalled NOK Operating revenues in the third quarter amounted to NOK 131.9 million (0.0) and principally come from a project in 27.4 million. This is largely due to Modul and Meglerhuset Bergen. Selvaag. The revenues for Moduler will gradually be phased out as its activities are becoming increasingly directed The operating expenses including construction costs follow towards internal deliveries and direct orders in the property the project and came to NOK 117.3 million excluding projects. financing expenses. Total operating revenues for the segment represented NOK The operating profit for the segment is satisfactory and 39.5 million in the third quarter of 2011. This can largely be gives an EBITDA margin of 11% in the third quarter of 2011, attributed to company promotion, preparing the group for including expensing value added tax at the group level. The the stock exchange listing, undertaking the merger with underlying project margin is a little higher. Hansa Property Group AS, as well as a private placement to Selvaag Pluss Eiendom KS. Property development – Other EBITDA of NOK –12.1 million for the segment is satisfactory countries and as expected given the activities undertaken during the The segment includes projects that the group is involved in period. outside Norway. As at the third quarter of 2011 there are no active projects in the segment.

The operating revenues in the third quarter were NOK 1.1 million which were entirely due to lease income, while

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Q3 2011

Operating review

Operations Number of units sold There has been a high level of activity in the company, There has been good sales performance in the third quarter construction projects have surged and sales of properties of 2011, and total sales via both wholly owned and partly have risen. To show the value creation in the company the owned companies reached 247 units in the third quarter of segment reports have listed revenues and expenses from 2011 (Selvaag Bolig’s portion). During the first nine months the various projects given that the company would have of this year the company has sold 504 units (Selvaag Bolig’s used the accounting policy of recognising revenues from portion). projects on an ongoing basis.

Projects The company has projects in Oslo, Lørenskog, Moss, Jessheim, Drammen, Kristiansand, Stavanger, Trondheim, Tromsø and Stockholm.

Quarterly development in inventories

Q1 2010 Q2 2010 Q3 2010 Q4 2010 Q1 2011 Q2 2011 Q3 2011 Number of units sold 67 120 79 122 87 170 247 Number of commenced units 0 116 0 238 536 49 100 Number of units in production 0 116 116 354 862 895 995 Proportion of sold units in production 0 % 61 % 73 % 30 % 48 % 59 % 71 % Number of completed unsold units 44 35 29 20 16 13 11

Source: Selvaag Bolig ASA

Market development In the third quarter Selvaag Bolig has made 130 units available for sale* via wholly owned or partly owned A total of 504 units have been sold in 2011, of which 247 companies, while the group has commenced 100 units. took place in the third quarter of 2011. At the same time last year 266 units had been sold. In the business area of projects there has been a high level of activity over the last year and during the course of the Number of units sold first nine months in 2011 work has commenced on 678 units. At the end of the third quarter Selvaag Bolig had 995 600 units under development, compared with 116 units under development at the end of the third quarter 2010. 400 Projects in progress

200 Project Number of units Property type Bjørnåsen Syd 47 Flats 0 Skullerudlia 30 Terraced houses 2010 2011 Kjørbo 34 Flats Q1 Q2 Q3 Lervig Brygge 19 Terraced houses

Total 130 * Selvaag Bolig's share of sales commenced is 109 units Source: Selvaag Bolig ASA

Source: Selvaag Bolig ASA

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Q3 2011

Commenced units AS became a 100% owned subsidiary following approval from the extraordinary general meeting which was held on 21 November 2011. Selvaag Bolig would like to use BO En as a 800 platform for further growth in the Stavanger region. By 600 owning the company as a fully owned subsidiary the projects will be profiled as Selvaag Bolig projects, and the 400 various concepts Start, Hjem and Pluss will be used when marketing future projects in Stavanger. 200

0 2010 2011 Risk and elements of Q1 Q2 Q3 Q4 uncertainty Source: Selvaag Bolig ASA Selvaag Bolig ASA is a property developer. There is therefore risk associated with the company selling the properties that have been made available for sale. Thus Share information expectations about the level of unemployment and interest rates in the future are two parameters that are very important to people considering purchasing a new property. At the end of the quarter the company had 96 shareholders, In relation to input factors for building properties, the of these 4 are foreign. trajectory of construction costs is the single largest element that will affect future margins in the company. 15 largest shareholders as of 30/09/2011

Shareholders Number of shares Ownership interest % Selvaag Gruppen AS 41 285 920 62.8 % Outlook Ferd Eiendomsinvest AS 3 604 856 5.5 % Havfonn AS 3 604 856 5.5 % The demand and need for properties in the largest cities in Skips AS Tudor 3 235 517 4.9 % Norway is substantial, driven by high rates of migration. IKM Eiendom AS 3 058 938 4.7 % The migration requires that access to new properties Storebrand Livsforsikring 2 741 388 4.2 % increase significantly over the next several years, but we Toluma Invest AS 813 318 1.2 % think that the greatest growth will come from properties in Veidekke Eiendom AS 753 238 1.1 % the low to medium price segment. MP Pensjon 522 829 0.8 % Svithun Finans AS 448 709 0.7 % Contracts have risen markedly during the last year as a TS Eiendom AS 448 709 0.7 % result of growing activity. Through Selvaag Bolig’s industrial SEB Enskilda ASA 383 225 0.6 % approach, in several projects we will be able to moderate AS Wingana 353 359 0.5 % the price pressure to some extent which will then result in Hustadlitt AS 351 449 0.5 % our competitive ability exceeding that of our competitors. Megaron AS 340 924 0.5 % Total 15 largest shareholders 61 947 235 94.2 % Other shareholders 3 797 805 5.8 % Instability in Europe over the short term will contribute to Total number of shares 65 745 040 100.0 % moderating people’s property investment proclivity and the instability might result in the bank’s credit situation deteriorating and make it harder to secure mortgage Source: Selvaag Bolig ASA financing.

Selvaag Bolig expects a stabile, healthy market in 2012 and will present almost 1,500 new properties for sale during the Events occurring after the next year. We think that low interest rates and low balance sheet date unemployment rates coupled with historically high migration will contribute to continued strong growth in property investments. Selvaag Bolig ASA has reached agreement with the other shareholders in Bo En AS for Selvaag Bolig ASA to acquire 37.5% of the shares in the company. This means that Bo En

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Q3 2011

Quarterly accounts (IFRS)

Summary statement of comprehensive income

(figures in NOK 1 000, except earnings per share) Q3 2011 Q3 2010 9M 2011 9M 2010 2010 Revenues 4 397 73 573 101 739 266 435 357 468 Other revenues 32 669 5 070 41 211 15 938 21 662 Total operating revenues 37 066 78 643 142 950 282 373 379 130

Project expenses -15 807 -48 653 -69 671 -181 752 -219 127 Salaries and personnel costs -15 162 -9 614 -48 642 -33 011 -51 202 Depreciation and amortisation -994 -60 -1 276 -205 -491 Other operating expenses -16 375 -6 564 -48 682 -30 455 -43 249 Other gains (losses), net -990 - - -25 -25

Associated companies and joint ventures 75 602 -20 558 67 254 -30 115 -44 310 Total operating expenses 26 274 -85 449 -101 017 -275 563 -358 404 Operating profit 63 340 -6 806 41 933 6 810 20 726

Financial income 3 207 3 046 10 743 9 736 13 327 Financial expenses -33 672 -7 281 -44 254 -24 010 -36 583 Net financial expenses -30 465 -4 235 -33 511 -14 274 -23 256 Profit before taxes 32 875 -11 041 8 422 -7 464 -2 530 Income taxes 10 030 -2 695 15 990 -6 677 -13 793 Net income 42 906 -13 735 24 412 -14 141 -16 323

Other comprehensive income/expenses Translation differences 3 6 -4 -61 -74

Total comprehensive income for the period 42 909 -13 729 24 408 -14 202 -16 397

Net income for the period attributable to: M inority interests - - - - Shareholders in Selvaag Bolig ASA (majority interests) 42 906 -13 735 24 412 -14 141 -16 323

Total comprehensive income for the period attributable to: M inority interests - - - - Shareholders in Selvaag Bolig ASA (majority interests) 42 909 -13 729 24 408 -14 202 -16 397

Earnings per share for net income attributed to sharholders in Selvaag Bolig ASA

Earnings per share (basic and diluted) in NOK 2.24 -137 352 1.28 -141 413 -163 230 The summary consolidated financial information has not been audited

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Q3 2011

Summary statement of financial position

(figures in NOK 1 000) 30.09.2011 30.09.2010 31.12.2010 ASSETS Non-current assets Deferred tax assets 60 777 10 971 3 847 Goodwill 288 906 7 007 7 007 Other intangible assets 92 000 - - Property, plant and equipment 5 802 3 481 3 774 Investments in associated companies and joint ventures 388 761 382 740 371 452 Loans to associated companies and joint ventures 36 339 233 958 240 027 Other non-current assets 50 688 - - Total non-current assets 923 273 638 157 626 107

Current assets Inventories (property) 3 027 005 374 136 365 822 Trade receivables 24 337 31 601 8 278 Other current receivables 74 102 65 324 68 438 Cash and cash equivalents 382 785 30 700 13 525 Total current assets 3 508 229 501 761 456 063 TOTAL ASSETS 4 431 502 1 139 918 1 082 170

EQUITY AND LIABILITIES Equity attributed to shareholders in Selvaag Bolig ASA 1 247 593 322 084 322 042 Non-controlling interests 7 477 - - Total equity 1 255 070 322 084 322 042

LIABILITIES Non-current liabilities Pension liabilities 533 3 044 533 Deferred tax liabilities - - - Provisions 14 700 90 750 84 364 Other non-current non interest-bearing liabilities 29 565 - - Non-current interest-bearing liabilities 2 221 498 13 900 - Total non-current liabilities 2 266 296 107 694 84 897

Current liabilities Current interest-bearing liabilities 603 937 643 694 627 901 Trade payables 57 788 9 782 9 090 Current tax payables -81 32 - Provisions - - - Other current non interest-bearing liabilities 248 492 56 632 38 240 Total current liabilities 910 136 710 140 675 231 Total liabilities 3 176 432 817 834 760 128 TOTAL EQUITY AND LIABILITIES 4 431 502 1 139 918 1 082 170 The summary consolidated financial information has not been audited

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Q3 2011

Summary statement of changes in equity

Share Other Cumulative Equity attributed Non- Share premium paid-in translation Other Retained to shareholders in controlling Total (figures in NOK 1 000) capital account capital differences reserves earnings Selvaag Bolig ASA interests equity EQUITY AS OF 1 JANUARY 2011 159 7 286 699 132 1 149 3 528 -389 212 322 042 - 322 042

Transactions with owners:

Share issue in connection with business combinations 48 897 852 246 901 143 901 143 Conversion of liabilities to equity 82 413 17 587 100 000 100 000 Group contribution paid -100 000 -100 000 -100 000 Business combination - 7 477 7 477

Total comprehensive income for the period: Net income for the period 24 412 24 412 24 412 Other comprehensive income/loss for the period -4 -4 -4 EQUITY AS OF 30 SEPTEMBER 2011 131 469 877 119 699 132 1 145 3 528 -464 800 1 247 593 7 477 1 255 070

EQUITY AS OF 1 JANUARY 2010 159 7 286 560 546 1 223 1 375 -345 313 225 276 - 225 276

Transactions with owners: Group contribution received 131 000 131 000 131 000 Group contribution received (after tax) 7 586 7 586 7 586 Group contribution paid (after tax) -27 576 -27 576 -27 576

Total comprehensive income for the period: Net income for the period -14 141 -14 141 -14 141 Other comprehensive income/loss for the period -61 -61 -61 EQUITY AS OF 30 SEPTEMBER 2010 159 7 286 699 132 1 162 1 375 -387 030 322 084 - 322 084 The summary consolidated financial information has not been audited

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Q3 2011

Summary statement of cash flows (figures in NOK 1 000) Q3 2011 Q3 2010 9M 2011 9M 2010 2010

CASH FLOW FROM OPERATING ACTIVITIES Profit before taxes 32 875 -11 041 8 422 -7 464 -2 530 Income taxes paid - - - - - Depreciation and amortisation 994 60 1 276 205 491 Other gains (losses), net - - 25 25 Share of profits from associated companies and joint ventures -75 602 20 558 -67 254 30 115 44 310 Changes in inventories (property) -110 927 -2 138 -127 437 78 650 86 964 Changes in trade receivables -9 019 2 057 -24 717 19 012 42 335 Changes in trade payables -402 -2 434 3 694 -7 038 -7 730 Changes in other operating working capital 69 232 7 308 66 359 55 890 57 976 Changes in other operating working capital 64 068 3 895 81 918 -166 526 -193 261

Net cash flow from operating activities -28 781 18 265 -57 739 2 869 28 580

CASH FLOW FROM INVESTMENT ACTIVITIES Proceeds from sale of property, plant and equipment and intangible assets - - - -

Purchases of PPE and intangible assets - - -151 -45 -624 Proceeds from disposal of businesses and subsidiaries, net of cash disposed - - 6 328 - - Purchases of businesses and subsidiaries, net of cash acquired 270 777 - 270 777 -164 -164 Proceeds from sale of associated companies - - - - - Purchases of associated companies -41 368 - -90 156 -123 -11 790 Proceeds from sale of other investments and repayment of accounts receivable - - - - - Purchases of other investments and accounts receivable -135 930 -6 125 -147 265 -18 924 -24 993 Dividends and disbursements from associated companies and joint ventures - - 1 650 10 550 15 671 Net cash flow from investment activities 93 479 -6 125 41 183 -8 706 -21 900

CASH FLOW FROM FINANCING ACTIVITIES Proceeds from borrowings 936 135 - 945 250 - - Repayments of borrowings -221 500 - -221 500 -25 714 -25 714 Net change in bank overdrafts (Selvaag Gruppen group account) -528 528 7 308 -444 001 -45 312 -75 005 Proceeds from share issues 106 067 - 106 067 - - Proceeds from group contributions - - - 141 536 141 536 Payment of group contributions - - - -38 300 -38 300 Net cash flow from financing activities 292 174 7 308 385 816 32 210 2 517 Effects of exchange rate changes on cash and cash equivalents - - - - -

Net change in cash and cash equivalents 356 872 19 447 19 447 26 372 9 197 Cash and cash equivalents as of 1 January 25 913 11 253 13 525 4 328 4 328 Cash and cash equivalents as of 30 September 382 785 30 700 32 972 30 700 13 525 The summary consolidated financial information has not been audited

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Q3 2011

Selected notes to the quarterly financial statements

1. General information and accounting policies are largely the same as the estimates that were applied to Selvaag Bolig ASA ("The company") and its subsidiaries the group accounts for the 2010 financial year. (consolidated into “The group”) is a property development group, whose principle activity is the development and sale 3. Transactions with related parties of properties. The summary consolidated financial See note 23 in the group financial statements for the year information comprises the group and the group’s ownership 2010 for detailed information on transactions with related interests in associated companies and joint ventures. parties in previous years.

The group’s summary consolidated financial information for The following material new transactions with related the nine month period ended 30 September 2011 has been parties were undertaken during the first nine months of prepared in accordance with IAS 34 Interim Financial 2011: Reporting. The report does not contain all the information and notes required of annual financial statements and must On 4 May 2011 the group signed an agreement to transfer be read in connection with the group accounts for Selvaag all ownership interests in the wholly owned subsidiary Bolig AS for 2010. During the period there have been two Selvaaghus AB to Selvaag Eiendom AS, a subsidiary of substantial mergers that have had a material effect on the Selvaag Gruppen AS for a consideration of NOK 7.4 million. composition of the group. For information on these see Note 4. On 24 May 2011 approval was granted for an increase in share capital in Selvaag Bolig AS of NOK 100 million. The The accounting policies underlying the preparation of this increase was undertaken by converting liabilities with summarised financial information for the interim period are Selvaag Gruppen AS, and was entered in the Register of in accordance with the policies applied in the group Business Enterprises on 18 June 2011. financial statements for the 2010 accounting year. On 10 June 2011 the Annual General Meetings in Selvaag The standards and interpretations that apply from 1 Bolig AS and Hansa Property Group AS approved a merger of January 2011, and have been expounded in note 2.21 to the the two companies. As a condition of the merger the group accounts for the 2010 financial year, do not have a company has made a private placement to the owners in material effect on the group’s summary financial Selvaag Pluss Eiendom KS. Both transactions were information for the nine month period ending on 30 implemented on 24 August 2011 and more information on September 2011. these can be found in note 4 Business Combinations.

The group executive management has not yet evaluated the In June 2011 the group sold the "Ekely" property in Skøyen effect of introducing new, revised or adjusted standards to Sealbay AS for NOK 5 million. Sealbay AS is controlled by with a later implementation date. two of the board members in Selvaag Bolig AS, Olav Hindahl Selvaag and Gunnar Frederik Selvaag. 2. Accounting judgements, estimates and assumptions The preparation of interim financial statements requires In the second quarter of 2011 the negative balance of NOK the executive management to make judgements, estimates 170 million in Selvaag Gruppen’s cash pool account service and assumptions that affect the application of accounting was converted to new current interest-bearing liabilities for policies and the reported amounts of assets, liabilities, Selvaag Gruppen. revenues and expenses. Actual results may differ from these estimated figures. In the first nine months of 2011 the group made a capital contribution to associated companies of NOK 25.5 million in In preparation of the summary consolidated financial Hansa Property Group AS and for NOK 64.7 million in information for the nine month period ended 30 September Selvaag Pluss Eiendom KS. 2011 the material estimates made by the executive management in applying the group’s accounting policies and the principal sources of uncertainty in the estimates

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Q3 2011

4. Segment information The group has changed the definition of operating segments group also reported the segments Modul, Service and in the nine month period ended 30 September 2011. As a Meglerhuset. These are now included in ”Other” together result of the transactions with Hansa Property Group AS and with unallocated revenues and expenses. The comparison SPE KS the principal segments are now defined as Property figures are restated in accordance with the new segment development divided according to the regions Greater Oslo, divisions. See note 4 to the group financial statements for The rest of Norway and Other countries. Previously the the year 2010 for further segment information.

3rd quarter Jan-Sep 2011 2010 2011 2010 Operating revenues by segment Property development Greater Oslo 523 601 3 563 523 601 17 873 Property development The rest of Norway 131 888 - 140 356 - Property development Other countries 1 155 - 1 155 - Other 27 414 53 963 119 712 147 948 IFRS adjustment (646 992) 21 117 (641 874) 116 552 Operating revenue group 37 066 78 643 142 950 282 373

EBITDA by segment Property development Greater Oslo 121 350 6 459 121 350 11 105 Property development The rest of Norway 14 563 - 17 419 - Property development Other countries 872 - 872 - Other (12 091) 5 033 (33 714) (2 097) IFRS adjustment (134 972) 2 320 (129 972) 28 147 EBITDA group (10 278) 13 812 (24 045) 37 155

Operating profit by segment Property development Greater Oslo 111 226 21 836 111 226 33 808 Property development The rest of Norway 10 001 - 12 857 - Property development Other countries 245 - 245 - Other (23 787) 18 874 (32 634) 19 991 IFRS adjustment (34 345) (47 516) (49 761) (46 989) Operating profit group 63 340 (6 806) 41 933 6 810

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Q3 2011

5. Business combinations

Acquisitions during the year

Proportion Date of of voting business equity Main business activity combination acquired

2011 Selvaag Pluss Eiendom KS Development and sale of properties 23.08.2011 66.7 % Hansa Property Group AS Development and sale of properties 22.08.2011 69.8 %

The above companies (with subgroup) have been acquired As a condition for the merger between Selvaag Bolig ASA with a view to extending growth in the group’s activities, and Hansa Property Group AS the company has undertaken which are developing and selling properties in and around a private placement to the owners in Selvaag Pluss Eiendom the largest cities in Norway, and other selected areas. KS. The share issue was implemented on 23 August 2011 and has resulted in Selvaag Bolig ASA currently holding a 100% On 10 June 2011 the Annual General Meetings in Selvaag ownership interest in the company. Bolig ASA and Hansa Property Group AS approved a merger of the two companies. Selvaag Bolig ASA is the continuing entity that will operate after the merger and the acquirer for accounting purposes. The merger will be implemented on 22 August 2011 which is also the date for transferring control.

Compensation Hansa Selvvag Pluss Property Eiendom KS Group AS Shares in Selvaag Bolig ASA 562 893 754 495 Total compensation 562 893 754 495

The fair value of shares issued as part of the compensation The transaction costs of NOK 11 million have not been for Selvaag Pluss Eiendom KS is calculated based on a included in the compensation transferred, but are valuation of the companies involved in the transactions and calculated as a cost in the current period as part of "other the exchange ratio between them. The valuation is based operating expenses" in the comprehensive income. on the management’s pricing of the plots of land and the projects in the individual companies as well as the value of Selvaag Bolig ASA based on continuing operations.

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Q3 2011

Identifiable assets and commitments calculated on the date of the business transfer - Selvaag Pluss Eiendom KS.

Fair value Book value adjustment Fair value ASSETS Non-current assets Deferred tax assets 5 797 (38 248) (32 451) Other intangible assets - 50 000 50 000 Property, plant and equipment - - - Investments in associated companies and joint ventures 39 458 - 39 458 Loans to associated companies and joint ventures 35 000 5 000 40 000 Other non-current assets 4 129 - 4 129 Total non-current assets 84 384 16 752 101 136

Current assets Inventories (property) 569 396 30 000 599 396 Trade receivables 865 - 865 Other current receivables 83 867 - 83 867 Cash and cash equivalents 83 042 - 83 042 Total current assets 737 170 30 000 767 170 TOTAL ASSETS 821 554 46 752 868 306

LIABILITIES Non-current liabilities Pension obligations - - - Deferred tax liabilities 610 - 610 Provisions - - - Non-current interest-bearing liabilities 427 403 - 427 403 Total non-current liabilities 428 013 - 428 013

Current liabilities Current interest-bearing liabilities - - - Trade payables 7 079 - 7 079 Current tax payables - - - Provisions - - - Other current non interest-bearing liabilities 15 286 - 15 286 Total current liabilities 22 365 - 22 365 TOTAL LIABILITIES 450 378 - 450 378

Fair value of net assets 417 928

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Q3 2011

Identifiable assets and commitments calculated on the date of the business transfer - Hansa Property Group AS

Fair value Book value adjustment Fair value

Non-current assets Deferred tax assets 159 612 (137 841) 21 771 Other intangible assets 6 270 35 730 42 000 Property, plant and equipment 197 - 197 Investments in associated companies and joint ventures 501 322 - 501 322 Loans to associated companies and joint ventures 160 990 - 160 990 Other non-current assets 114 160 - 114 160 Total non-current assets 942 551 (102 111) 840 440

Current assets Inventories (property) 2 018 260 - 2 018 260 Trade receivables 1 765 - 1 765 Other current receivables 2 458 - 2 458 Cash and cash equivalents 171 257 - 171 257 Total current assets 2 193 740 - 2 193 740 TOTAL ASSETS 3 136 291 (102 111) 3 034 180

Non-current liabilities Pension obligations - - - Deferred tax liabilities - - - Provisions 68 390 - 68 390 Non-current interest-bearing liabilities 2 224 720 - 2 224 720 Total non-current liabilities 2 293 110 - 2 293 110

Current liabilities Current interest-bearing liabilities - Trade payables 42 019 - 42 019 Current tax payables - - - Provisions - - - Other current non interest-bearing liabilities 74 640 - 74 640 Total current liabilities 116 659 - 116 659 TOTAL LIABILITIES 2 409 769 - 2 409 769

Fair value of net assets 624 411

Assets and liabilities taken over in connection with the business combination of Selvaag Pluss Eiendom KS and Hansa Property Group AS are calculated at the estimated fair value on the date of the takeover. The measurement of identifiable assets and liabilities is based on provisional valuations undertaken by management pending final valuations.

The fair value of trade receivables and other receivables in Selvaag Pluss Eiendom KS is NOK 84.7 million and includes trade receivables with a fair value of NOK 0.9 million. No provisions have been made for impairment.

The fair value of trade receivables and other receivables in Hansa Property Group AS is NOK 4.2 million and includes trade receivables with a fair value of NOK 1.8 million. The nominal value of the trade receivables is NOK 7.0 million, of which NOK 5.2 million is considered to be impaired.

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Q3 2011

Goodwill

Selvvag Pluss Hansa Property Eiendom KS Group AS Compensation transferred 562 893 754 495 Non-controlling interests 5 975 1 501 Fair value of identifiable net assets acquired (417 928) (624 411) Goodwill 150 940 131 585

Goodwill on acquisition of Selvaag Pluss Eiendom KS has is included in the item "share of profit and gains (losses) on mainly (NOK 113 million) arisen due to anticipated synergies disposal of associated companies and joint ventures" in the in ongoing operations and the benefit of integrating the comprehensive income. business in its entirety into the group (control premium). NOK 38 million applies to goodwill arising in connection From 24 August 2011 Selvaag Pluss Eiendom KS has with temporary differences between the carrying amounts contributed with NOK 0.9 million in sales revenues and NOK (fair value) and the tax bases of properties and brands. -0.3 million in net income in the consolidated comprehensive income. From 24 August Hansa Property Goodwill in connection with the merger with Hansa Group AS has contributed with NOK 1.7 million in sales Property Group AS is principally due to goodwill on revenues and NOK -4,3 million in net income in the recognition of deferred tax on temporary differences consolidated comprehensive income. between the carrying amounts and tax bases of properties acquired in connection with the business combination. If these businesses had been consolidated from 1 January 2011 the sales revenues for the group would have been NOK Goodwill that has arisen as part of a business acquisition is 129 million and the net income for the group for the nine not tax deductible. month period ended 30 September 2011 would have been NOK -29 million. Non-controlling interests at the date of takeover are measured at the fair value of net assets allocated to 6. Events after the reporting period minority shareholders. Selvaag Bolig ASA has reached agreement with the other Affect on group results shareholders in Bo En AS for Selvaag Bolig ASA to acquire 37.5% of the shares in the company. This means that Bo En The group has recognised a gain of NOK 62.6 million that AS became a fully owned subsidiary following approval from resulted from a prior 33.3% ownership interest in Selvaag the extraordinary general meeting that was convened on 21 Pluss Eiendom KS before the business combination being November 2011. revalued to fair value. Correspondingly a gain of NOK 14.6 million was recognised when revaluing a prior ownership interest in Hansa Property Group AS to fair value. The gain

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Q3 2011

7. Shareholders

Number of Ownership Shareholders shares interest % Selvaag Gruppen AS 41 285 920 62.8 % Ferd Eiendomsinvest AS 3 604 856 5.5 % Havfonn AS 3 604 856 5.5 % Skips AS Tudor 3 235 517 4.9 % IKM Eiendom AS 3 058 938 4.7 % Storebrand Livsforsikring 2 741 388 4.2 % Toluma Invest AS 813 318 1.2 % Veidekke Eiendom AS 753 238 1.1 % MP Pensjon 522 829 0.8 % Svithun Finans AS 448 709 0.7 % TS Eiendom AS 448 709 0.7 % SEB Enskilda ASA 383 225 0.6 % AS Wingana 353 359 0.5 % Hustadlitt AS 351 449 0.5 % Megaron AS 340 924 0.5 % Total 15 largest shareholders 61 947 235 94.2 % Other shareholders 3 797 805 5.8 % Total number of shares 65 745 040 100.0 %

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Q3 2011

Contact information Telephone: +47 02224 / E-mail: [email protected]

About Selvaag Bolig Selvaag Bolig ASA is a property development company built upon Selvaag’s 60 years of history and experience. The company continually has several thousand properties under development across the country. Selvaag Bolig focuses particularly on the areas of Greater Oslo, Bergen and Stavanger, but also has two projects under development in Stockholm. The company manages the entire value chain from purchasing land to selling turn-key properties. Selvaag Bolig has a wide variety of property types that are categorised under the brand names Start, Hjem and Pluss. The company is managed by CEO Baard Schumann and Olav Hindahl Selvaag is the chairman. The company is located in Løren in Oslo.

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