• Nordicom enjoyed a satisfactory level of activity on the rental side in Q1
2009. The Group's rental income for Q1 2009 comprised DKK 67.6 m (Q1 2008: DKK
62.6 m), which corresponds to an increase of DKK 5 m. Operating income before
interest on the Group's completed investment properties amounts to DKK 51.6 m
(Q1 2008: DKK 50.9 m).
• Operating cash flow for Q1 2009 amounts to DKK -31.6 m (Q1 2008: DKKK -77.4
m), which corresponds to an improvement of DKK 45.8 m compared to the same
period last year. Cash flow from primary operations improved by 52.7 m while
financial costs increased by DKK 7.8 m.
• Net adjustments to fair value amount to DKK -16.2 m (Q1 2008: DKK 25.6 m) and
relate to bond debt and mortgage deeds holdings. In addition, DKK 7.6 m has
been written down on two projects where the expected project costs exceed the
sales amount.
• Net profit before tax for Q1 2009 comprises DKK -61.6 m (Q1 2008: DKK 28.8
m). The decrease in profit is due to no projects being delivered in 2009,
negative fair value adjustments and higher interest expenses compared to the
same period last year. Profit from leasing investment properties is still
increasing, while the profitability of the development activities has decreased
significantly.
• On the development front, the implementation of the new strategy has meant
the discontinuation of a planned development project in Høje-Tåstrup. The
project is deemed as having too long a time horizon and involving too many
risky elements along the way, which is why it is no longer attractive under
current market conditions. Abandoning the project has meant an accounting loss
of DKK 12.5 m. The reimbursement of previously deposited cash will, however,
have a positive cash flow impact of approx. DKK 15 m in Q2 2009.
• In Q1 2009 two smaller properties were sold with a profit of DKK 0.6 m. The
Group did not acquire any new properties in the period.
• In the course of Q1, Nordicom has received offers to extend more than DKK 1
billion worth of debt maturing in 2009. The extensions are expected to be
carried out on more competitive terms, so that interest rate expenses will
decrease in H2 2009. Negotiations are expected to conclude by the end of June.
In addition, the share of long-term debt has been increased since year end via
refinancing of debt (from 52.4% to 54.7% end of Q1).
• At the company's extraordinary general meeting on May 25th 2009, a proposal
was adopted to authorize the board of directors to increase the company's share
capital by up to DKK 150 m until April 1st 2014, and to issue convertible bonds
or other convertible letters of debt for an amount of up to DKK 150 m.
• Net profit for the accounting year of 2009 before valuation adjustments and
tax is expected to amount to between DKK 0 - 50 million. These expectations are
based on the following assumptions:
- renewals of the company's borrowing agreements are expected to conclude by
the end of Q2 2009 on more competitive terms than the present ones
- the staff reductions carried out will come into full effect in H2 2009
- the vacancy rate of the portfolio of rental properties will not deteriorate
in H2 2009.
