Increased operating net and lower vacancies

• Net sales increased by 12 per cent to SEK 1,435 (1,277) m.

• Profit before tax was SEK 286 (1,229) m. Net profit was SEK 272 (861) m in the interim period, equivalent to SEK 2.00 (6.30) per share.

• As of 30 June 2008, the property holding comprises 609 (575) properties with a book value of SEK 28,666 (25,737) m.

• In the interim period, 36 (40) properties were acquired for SEK 2,667 (3,110) m; 3 (20) properties were also divested for SEK 147 (1,852) m, generating a profit of SEK 31 (87) m. These divestments affected profit for calculating dividends by SEK 48 (137) m.

• Profit for calculating dividends for the interim period was SEK 322 (440) m. The forecast (unchanged) for full-year 2008 profit for calculating dividends is SEK 900 m, or SEK 6.60 per share.

• After the end of the interim period, seven properties were divested for SEK 704 m and will affect profit for calculating dividends by SEK 59 m.


Second quarter (April-June)

• Net sales increased by 10 per cent to SEK 721 (657) m.

• Profit before tax was SEK 173 (963) m. Net profit was SEK 199 (685) m, equivalent to SEK 1.50 (5.00) per share.

“The second quarter and summer featured generally more restrained sentiment and signs of a cyclical slowdown. Although credit markets are tougher, we have seen bright spots in the property market. Major deals included the acquisitions of Vasakronan and Steen & Ström of Norway, both by long-term investors. Around the mid-point of the year, Kungsleden divested office and warehouse premises totalling over SEK 800 m, at price levels exceeding both acquisition and book values.”

“The underlying rentals market remains positive. Our operating net increased by 17 per cent year on year, while vacancies declined somewhat. With a 58 per cent share of public properties, Kungsleden is in a strong position regardless of the business cycle development. Our strategy is to continue to focus on properties with long rental agreements and strong counterparts that provide us with stable cash flows. Our modular business also sustained its positive progress.”


“Interest costs were higher in the first half-year 2008 than the corresponding period of last year. Apart from higher market interest rates, this is due to Kungsleden being a net buyer of properties of slightly more than SEK 2.6 bn, and rationalizing our capital structure by redeeming some SEK 1.5 bn in late 2007. Despite somewhat higher market interest rates in the period, our average interest rate remained largely unchanged.

Despite conditions being more challenging, we are reiterating our forecast of profit for calculating dividends of SEK 900 m for 2008,” commented Kungsleden’s Chief Executive Thomas Erséus.