Sponda Group recorded a first-quarter net profit of EUR 79.5 (9.1). Total revenue was EUR 26.2 (29.5) million and was derived from rental income. The operating profit was EUR 82.1 (20.1) million. The result includes a capital gain of EUR 67 million on the sale of the Itäkeskus Shopping Mall. First-quarter earnings per share were EUR 0.98 (0.11).
Net operating income totalled EUR 19.3 (23.0) million, which was 16.1 % lower than one year earlier. The book value of the property portfolio was EUR 958.3 million. Shareholders' equity per share was EUR 7.10 (31 December 2001: EUR 6.12).
Net financial items amounted to EUR -0.2 (-8.8) million and included a dividend of EUR 7.9 million from Wereldhave N.V.
Financing
Interest-bearing net debt amounted to EUR 480.3 million (31 December 2001: EUR 716.0 million) and the equity ratio was 53.5 % (31 December 2001: 41.6 %). The average maturity of Sponda's credit lines was 3.9 years, the average interest rate was 4.9 % and the average interest period was 2.4 years. Sponda had EUR 200 million in unused credit facilities. Financial assets in the balance sheet totalled EUR 103.7 million (31 December 2001: EUR 2.6 million).
Business conditions
The vacancy rate of business premises in the Helsinki Metropolitan Area is rising. The vacancy rate for office premises at the beginning of the year was 3.7 % while for commercial and logistics premises the figure remained at approximately 1.5 %. The highest availability of office space is in Espoo, where the vacancy rate exceeds 6 %.
Leasing
Net operating income from Sponda's properties totalled EUR 19.3 (23.0) million, of which 51.3 % was derived from Helsinki CBD, 17.7 % from Helsinki Metropolitan Area, 17.9 % from Logistics Properties and 13.1 % from the rest of Finland. The economic occupancy rate of Sponda's entire property portfolio at the end of March was 92.5 % (31 December 2001: 93.5 %).
On 31 March 2002 the economic occupancy rate of Sponda's properties in Helsinki CBD was 97.0 % (31 December 2001: 97.1 %) and net operating income totalled EUR 9.9 million. The same figures for Sponda's other business areas were as follows: Helsinki Metropolitan area 76.7 % (31 December 2001: 70.5 %)and EUR 3.4 million, Logistics Properties 93.0 % (31 December 2001: 91.1 %) and EUR 3.4 million, and Sponda's properties in the rest of Finland 96.3 % (31 December 2001: 97.7 %) and EUR 2.6 million.
Sale of the Itäkeskus Shopping Mall
Sponda sold the Itäkeskus Shopping Mall to the Dutch property investment company Wereldhave N.V. for EUR 317 million in January 2002. Under the terms of the deal Sponda subscribed for 1,935,000 Wereldhave shares, representing about 10 % of the Wereldhave stock. The total impact of the Itäkeskus sale on Sponda's result was EUR 75 million, comprising a capital gain of EUR 67 million and a dividend of EUR 7.9 million.
Personnel
The Sponda Group had 51 (54) employees on average between January and March 2002, which included 48 (46) employed by the parent company Sponda Plc. Personnel numbered 50 (55) on 31 March, including 49 (46) in the parent company.
Group structure
Sponda Group comprises the parent company and its wholly owned subsidiaries. With the exception of Tamsoil Oy and Castrum Oyj, these are mutual property companies.
Share performance
Sponda's share price in the 1-3/2002 period was higher than in the previous quarter and the closing price on 31 March was EUR 5.65. The average price between January and March was EUR 5.22, the lowest price being EUR 4.48 and the highest price EUR 5.75. Sponda's market capitalization at the close of the period was EUR 463 million.
Resolutions of Sponda Plc's Annual General Meeting
Sponda Plc's Annual General Meeting on 27 March 2002 approved the consolidated and parent company's financial statements for the year 2001 and discharged the company's officers from liability for the financial year. The meeting carried the Board of Directors' proposal to pay a dividend of EUR 0.30 per share on the financial year 2001.
1. The meeting decided to reduce the share capital by at most EUR 827,400 by annulling the 827,400 Sponda Plc shares acquired by the company. The reduction in share capital will not affect the conversion ratio of the convertible bond loan approved by the Annual General Meeting on 27 March 2000.
2. The meeting decided to authorize the Board of Directors for one year from the AGM to purchase at most 3,500,000 of the company's own shares using distributable funds provided that after the purchase the aggregate nominal value of the shares owned by the Company and its subsidiary companies, or the voting rights carried by these shares, may not exceed five (5) percent of the Company's total share capital or the voting rights carried by all the shares.
3. The meeting decided to authorize the Board of Directors for one year from the AGM to surrender at most 3,500,000 of the acquired company shares.
Composition of the Board of Directors
The following were re-elected to the Board of Directors: Heikki Bergholm, Msc (Eng); Maija-Liisa Friman, President; Harri Pynnä, Legal Counsel; Anssi Soila MSc (Eng), MSc(Econ); and Jarmo Väisänen, Financial Counsellor. Jarmo Laiho, Executive Vice President, was elected as a new member. The Board elected Anssi Soila Chairman and Jarmo Väisänen Deputy Chairman.
Auditors
The meeting appointed Sixten Nyman APA and KPMG Wideri Oy Ab as the company's auditors, and Ari Viitala APA as the deputy auditor.
Subsequent events
Sponda sold all its Wereldhave shares to international institutional investors for EUR 104 million. The impact of this sale is included in the first-quarter accounts.
Prospects
Sponda's result in 2002 will be excellent due to the sale of the Itäkeskus Shopping Mall and clearly better than in 2001. The volume and result of leasing operations will be lower than in 2001.
25 April 2002
Sponda Plc
Board of Directors
The terms "Sponda", "the Group", or "the company" refer to the entire Sponda Group. The term "Sponda Plc" refers to the Group's parent company. The figures in this interim report are unaudited.
The full Interim Report including tables is available to download from the enclosed link.
