Nordicom achieved a gross profit of DKK 339.2 m for the first three quarters of
2008 compared to DKK 327.6 m for the same period in 2007. The increase of DKK
11.6 m is due to a larger value creation achieved through project development
for own portfolio.
The Group's profit before tax amounts to DKK 167.0, which is a drop of 15%
compared to the profit before tax for Q1-Q3 2007. This decrease is mainly due
to increased interest expenses and, in light of the current situation in the
financial markets, this is a satisfactory result.
The Group generated a positive free cash flow from primary operations of DKK
77.3 m. As at end Q3, the Group's cash holdings amount to DKK 332.7 m.
Occupancy rates of the company's properties are still high and the relatively
high inflation in 2008 has given rise to relatively high inflation linked
adjustments of rental revenues for 2009. The cash flow from property leases is
sufficient for Nordicom to have a healthy liquidity situation and no property
sales are therefore required.
The value of Nordicom's finished investment properties came to DKK 3,798 m at
the end of the quarter, and consists mainly of high yielding properties. Over
the past few years, which have seen a number of high price rises in the
property market, the portfolio has been consistently marked at a conservative
and high market yield. End Q3, Nordicom's portfolio continues to be valued
using the same principles as end 2007, corresponding to an average yield of
approx. 6.7%.
Our areas of focus for current development projects are retail and office
development, where we continue to see a positive demand in spite of the
financial crisis. New projects will only be started if finance has been
achieved beforehand.
The previously expected profit before tax of DKK 300 m has been adjusted
downwards to a level of around DKK 200 m before tax. It is the substanitally
diminished oportunities for sales of properties and the increased interest
expenses that have resulted in the downwards adjustment in expectations. Our
new estimate does not account for the sale of properties in Q4.
