Summary
• TK Development recorded a profit of DKK 6.2 million after tax, compared to
DKK 68.2 million in the same period the year before.
• Consolidated equity totalled DKK 1,610.3 million at 31 July 2010,
corresponding to a solvency ratio of 35.1 %.
• The Group's 10,900 m² retail park in Uppsala, Sweden, was completed and
opened fully let in March 2010. The retail park was sold, based on forward
funding, and handed over to the investor, an institutional fund of German IVG
Funds, in April 2010.
• The Group's Sillebroen Shopping Centre in Frederikssund, Denmark, was
completed and opened as planned on 25 March 2010. The shopping centre has a
current occupancy rate of 92 %, and negotiations with tenants for the remaining
premises are ongoing. The centre enjoyed a successful opening and has a
satisfactory influx of customers.
• The Group's total project portfolio amounted to DKK 3,440 million at 31 July
2010, of which DKK 2,059 million is attributable to projects that have been
completed and thus generate cash flow. The annual net rent from the current
leases amounts to DKK 148.3 million, equal to a return on invested capital of
about 7.2 %.
• In August 2010, the Group took over the development of a 5,400 m2 property
project at Trøjborgvej in Århus, Denmark. A building permit has been granted,
and the project has been fully financed. The project will be carried out in
cooperation with Nordica Real Estate A/S via a jointly owned project company in
which the Group has a 20 % stake.
• In conjunction with the takeover of the Trøjborgvej project in Århus,
Denmark, the Group sold two completed retail parks to the jointly owned project
company.
• Based on satisfactory pre-construction letting, TK Development began building
the second phase of the Fashion Arena Outlet Center, Prague, the Czech
Republic, of about 7,000 m² in April 2010. Construction on the second phase is
progressing according to plan, and the opening is scheduled for October 2010.
• The Group's project portfolio comprised 986,000 m² at 31 July 2010 (957,000
m2 at 31 January 2010).
• Since the beginning of 2010, the market situation has developed favourably.
The general investment climate is marked by cautious optimism and a higher
propensity to invest. There is growing demand for real property, with investors
continuing to focus mainly on quality and location.
• Management believes that land prices, construction costs, rent levels and
property prices have stabilized at a new level. The new price levels underpin
the profitability of future property development, and new projects in the
portfolio are thus expected to generate a normal profit.
• An Extraordinary General Meeting was held on 1 July 2010, at which the
General Meeting resolved to carry out a capital increase in the form of a
rights issue with total gross proceeds of DKK 210.3 million. The capital
increase was implemented in August 2010.
• The capital increase has placed TK Development in a stronger position to
seize the project opportunities in the present market.
• For the 2010/11 financial year, the Group still expects to generate a profit
after tax of about DKK 100 million.
Further information is available from Frede Clausen, President and CEO, on tel.
+45 8896 1010.
The expectations for future developments presented in this announcement,
including earnings expectations, are naturally subject to risks and
uncertainties and may be affected by various factors, such as global economic
conditions and other significant issues, including credit-market, interest-rate
and foreign-exchange developments. Reference is also made to the section “Risk
issues” in the Group's 2009/10 Annual Report.
