Citycon Presentation Q2 2006 Figures Citycon’s Mission and Vision Mission Demonstrating expertise in retail property business, Citycon not only owns, manages, leases and develops shopping centres, supermarkets and retail outlets but also plans and commissions the construction of new retail premises. Vision Citycon aims to expand its property portfolio and increase its value. The company’s objective is to serve an array of retailers by providing them with the best industry expertise and premises meeting their needs. Strategy Citycon focuses on retail properties, its core business consisting of shopping centres, supermarkets and other large retail units. Its business operations concentrate on urban growth centres in Finland, Sweden and the Baltic countries. Citycon is the largest owner of shopping centres in Finland. In its operations Citycon seeks to expand the Company’s value and expertise as well as seeking customer relationships based on strong partnership. Citycon’s business strategy is based on the following primary elements: • Focus solely in retail premises • Geographical priority areas are the largest cities in Finland, Scandinavia and the Baltic States • Citycon aims at growing its portfolio by acquisitions and development projects © Citycon Oyj 2 History of Citycon Citycon’s path to becoming the market leader and an international property investment company 2003 2004 2005 Citycon specifies its business Citycon continues to grow and its Citycon enters foreign markets by structure and branches out into the ownership structure becomes very acquiring its first properties in Sweden development of retail properties, in international. It begins to analyse and Estonia. It increases its holding in a addition to owning, leasing and potential for entry into the Baltic number of Finnish shopping centres with managing them. The company’s countries and Scandinavia. a view to enabling more efficient property portfolio expands development operations. The year also considerably. The company’s sees the preparation of several other ownership base changes when the shopping-centre development projects. former main shareholders sell their holdings in the company. International investors become interested in Citycon. © Citycon Oyj 3 Citycon in Brief Citycon’s Shopping Centres ¾ Finnish listed property investment company focusing solely on retail premises • 29 shopping and retail centres, 127 supermarkets and shops • Market value of the property portfolio EUR 1,143.2 million ¾ Citycon’s main geographic operating region is Finland but the company also entered the Swedish, Estonian and Lithuania markets in 2005 and 2006 ¾ Citycon has been quoted on the Helsinki Stock Exchanges’ Main List since 1988 • Citycon is also included in EPRA/NAREIT Real Estate Index © Citycon Oyj 4 Key Strengths ¾ Leading market position in the Finnish shopping centre market • Diverse range of shopping and retail centres in the Baltic Rim ¾ Operational focus in markets with strong economies and solid growth of retail trade • Finnish GDP growth has been stronger than the average of the Euro-area. Consumer purchasing power has increased and consumers’ confidence in their own economy has remained strong ¾ Strong operating cash flow • Citycon’s current property portfolio and rental agreement structure provide a solid basis for a stable cash flow ¾ Expertise in real estate development and shopping centre business • Management of the Citycon has considerable experience in the real estate business. Members of the corporate management committee have long-term experience in letting, maintenance, and development of retail premises © Citycon Oyj 5 Financial Results for 1 January – 30 June 2006 ¾ Turnover increased 29.5 per cent, to EUR 55.0 million mainly due to property acquisitions in Finland, Sweden and Estonia in 2005 and 2006 ¾ Profit before taxes came to EUR 95.8 million, including EUR 75.3 million in fair value increase in investment properties ¾ Earnings per share were EUR 0.47 (EUR 0.11) • Earnings per share, excluding the valuation items and the related tax impact were EUR 0.10 (EUR 0.06) ¾ At the end of the reporting period, Citycon owned 156 properties with a market value totalling EUR 1,143.2 million (EUR 754.7 million) ¾ Net rental income increased to EUR 39.0 million (EUR 31.2 million) while that for like-for-like properties grew by 3.2 per cent ¾ Citycon’s market capitalisation was EUR 595.7 million (EUR 342.5 million) in 30 June 2006 ¾ Business environment remained favourable, with international investors showing a keen interest in Nordic retail properties © Citycon Oyj 6 Key Figures Turnover, profit and market value of Key figures 1-6 2006 1-6 2005 1-12 2005 investment properties, EUR million Income Statement 100 1 000 Gross rental income, EUR million 52.8 41.3 89.1 90 950 55.0 42.5 92.2 Turnover, EUR million 80 Net rental income, EUR million 39.0 31.2 67.0 900 70 Net fair value gains on investment property, EUR 850 million 75.3 7.8 45.9 60 Profit for the period, EUR million 72.7 13.3 59.8 50 800 40 750 Balance Sheet 30 700 Investment property, EUR million 1 143.2 754.7 956.6 20 Non-current assets, EUR million 1 144.3 759.6 957.6 10 650 Current assets, EUR million 26.3 40.7 25.5 0 600 Assets, total, EUR million 1 170.6 800.4 983.1 FAS 2001 FAS 2002 FAS 2003 IFRS 2004 IFRS 2005 Total shareholders' equity, EUR million 495.2 230.9 360.2 Liabilities, EUR million 676.4 569.5 622.9 Turnover, €m Profit, €m MV of investment properties, €m Liabilities and shareholders' equity, total, EUR million 1 170.6 800.4 983.1 Key Financial Figures Return on equity (ROE), % 35.0 11.2 22.5 Return on investment (ROI), % 20.4 9.5 13.5 Equity ratio, % 42.3 28.9 36.7 Gearing, % 122.9 217.2 156.8 Personnel at the end of period 61 46 57 © Citycon Oyj 7 Key Figures per Share EPS and equity ratio -% Share price vs. equity 0,50 40 3,5 0,45 35 3 0,40 30 2,5 0,35 25 0,30 2 € 0,25 20 % 1,5 0,20 15 0,15 1 10 0,10 0,5 0,05 5 0,00 0 0 FAS 2001 FAS 2002 FAS 2003 IFRS 2004 IFRS 2005 FAS 2001 FAS 2002 FAS 2003 IFRS 2004 IFRS 2005 EPS, € Equity ratio, % Equity per share, € Closing price,€ Key figures 1-6 2006 1-6 2005 1-12 2005 Earnings per share, EUR 0.47 0.11 0.47 Earnings per share, diluted, EUR 0.47 0.11 0.46 Earnings per share (basic), excluding the effects of change in fair values, EUR 0.10 0.06 0.20 Net cash from operating activities per share, EUR 0.10 0.05 0.19 Equity per share, NAV, EUR 2.98 1.94 2.45 NNNAV, EUR 3.00 1.94 2.45 P/E (price/earnings) ratio 4 14 7 © Citycon Oyj 8 Citycon Share Turnover and average price Price trend in Citycon share vs. indexes, 3 year 250,0 3 310 % 280 % 2,5 200,0 250 % 2 220 % 150,0 190 % 1,5 160 % 100,0 130 % 1 100 % 50,0 70 % 0,5 40 % 10 % 0,0 0 2001 2002 2003 2004 2005 -20 %7/03 10/03 1/04 4/04 7/04 10/04 1/05 4/05 7/05 10/05 1/06 4/06 7/06 Trading, M€ Average price, € Citycon Oyj EPRA/NAREIT Eurozone index OMX Helsinkin CAP index ¾ High price quoted during the period was EUR 4.23 (EUR 3.09) ¾ Market capitalisation on 30 June 2006 was EUR 595.7 million (EUR 342.5 million) ¾ Citycon is included in international indices of property-investment companies. For example, EPRA/NAREIT Global Real Estate Index serves as a benchmarking index for international investors, tracking share-price performance and total return © Citycon Oyj 9 Citycon – Largest Shareholders on 30 June 2006 ¾ Citycon has 1,571 registered shareholders. Nominee-registered, mostly international investors, shareholders represented 92.4 per cent of the total number of shares % of shares and Name Number of shares votes Odin Forvaltnings AS 1,441,200 0.9 Ilmarinen Mutual Pension Insurance Company 1,372,800 0.8 Etera Mutual Pension Insurance Company 600,000 0.4 Oy Fincorp Ab 480,000 0.3 Fieandt von Johan 420,000 0.3 Tudeer Lauri 415,000 0.3 OP-Suomi Value Investment Fund 413,200 0.3 Investment Fund Celeres Reit Real Estate 224,000 0.1 Odin Eiendom 204,000 0.1 Investment Fund OP-Real Estate 180,000 0.1 10 major, total 5,750,200 3.6 Nominee registered shares, mostly foreign investors, t 152,413,075 92.4 Othre owners, total 12,610,206 7.6 Shares, total 165,023,281 100.00 ¾ The company has not received any statutory notices of changes in ownership during the period. Gazit-Globe Ltd. has informed the company that the number of shares held by it on 31 December 2005 totalled 50,255,000 accounting for 36.8 per cent of the shares and voting rights in the company. Gazit-Globe Ltd.'s shares are nominee registered © Citycon Oyj 10 Financing Maturity profile 30 June 2006 Key figures of financing at June 30, 2006 400 Equity ratio 42,3 % 341 350 Average interest rate 4,3 % 300 Average loan maturity 2,5 years Average interest-bearing period 2,4 years 250 Gearing 122,9 % 200 Interest coverage ratio 2,5 EUR million Hedging percentage 63,1 % 150 137 100 81 82 70 83 52 53 40 50 7 1 0 0 2006 2007 2008 2009 2010 2011 Maturity profile of loan portfolio as per 30 June 2006 Maturity profile of interest rate derivatives as per 30 June 2006 ¾ Unsecured syndicated loans EUR 414 million – EUR 329 million term loans and EUR 85 million revolving credit outstanding (facility EUR 100 million) ¾ Unsecured bank loan SEK 280 million (EUR 30 million) ¾ Unsecured bank loan EEK 470 million (EUR 30 million) ¾ Secured bank loan SEK 54 million (EUR 6 million) ¾ Subordinated loan EUR 70 million ¾ Commercial Paper Programmes EUR 100 million, EUR 74 million outstanding © Citycon Oyj 11 Business Activities and Property Portfolio Summary © Citycon Oyj 12 Citycon Property Portfolio ¾ Citycon’s business activities comprise the entire chain of retail premises ownership, i.e.