Citycon Oyj

Good morning everyone and welcome to Citicon's first nine months 2025 results audiocast. My name is Anni Torkko and I work in the investor relations here at Citicon. Last night we published our nine-month interim report and in this audiocast our CEO Eshel Pesti and our CFO Eero Sihvonen together with our incoming CFO Hilik Attias will present the results. Eshel will first go through our business and operational highlights, and after that Eero, together with Hilik, will go through our financial results. Please, Eshel, go ahead.

Good morning, all of you. Thank you for coming to our quarterly report results. Our portfolio is including above million square meter, 76% of that is retail, then we have 187,000 square meter of office and storages, and the rest is residential and hotels. We have 28 mixed necessity base centers, 1 in Estonia, 9 here in Finland, 6 in Sweden, 10 in Norway and 2 in Denmark. We will go to the results now. We continue to deliver solid results and it's clear that we are in the right direction of growth. Like for like NOI, growth by 5.7%, The retail economic occupancy rate is 95.2%. The average rent per square meter is 27.5% for the retail and it's a growth of 2.7% in the last nine months. The footfall grew by 1.5%. The like-for-like tenant sales grew by 1.4%. We gain in our valuation 42.8 million euros in the last nine months. The NRI margin is 94. And here we have the quarterly results. And you see that they are in the same direction. We have a growth of 6.8%. The retail economic occupancy is 95.2%. The average rent is 27.5%. The retail average rent grew by almost 4%. The footfall grew by almost 3%. The sales grew by 1.6% and the valuation grew by 8.6%. NRI margin is 95%. Now, how the NRI divided between the portfolio, between the countries. So Norway contributes 3%, Sweden and Denmark 4% and Finland and Estonia 8.4% and our mixed results is 5.7% growth. And on the right side of the table you can see the bar how the average rent per square meter growth in the last 12 months between the third quarter of 24 to the third quarter of 25, which is 2.7%, one euro. This is the detail NRI bridge. I will pay your attention to the higher bar, which is the nine months results. you can see that actually we lost between the years 15.2 million euro as a result of selling the asset or as a result of the asset that we sold last year and we finished less than 5 million less than that number and what is donating to the increase of the NOI is the like for like in the properties which give us 6.8 million and the Kista that we purchased 50% is another 1.5 million and the redevelopments especially in Roka in Estonia donate for us another 1.3 and actually this is the explanation for this breach. Okay, go ahead. From here, I want to actually give the floor to Aero. And I will use this opportunity to thank Aero on behalf of all the employees in CityCon and the board member from the last seven years. Aero print fingers, you can see all over the company. and I am privileged to work with him in the last, let's say, one and a half months. And it's the secret asset that we have here in Citicon. And I will welcome Mr. Hili Katias. He is qualified, he has experience, And the big advantage is he is young and motivated, and I'm sure that he will enter to Aero's shoes smoothly, and we will together take the company forward. So thank you, Aero, and the floor is yours.

Thank you, Eshel, first of all for your kind words. And I have been honored and privileged to serve the company in this position now for a year again. And I'm sure that the company is in great hands with Eshel taking into account his very good track record and his operational capabilities and uh and hilik who who brings with him a long experience in enlisted retail retail real estate and his particular particular knowledge on everything that has to do with treasury and treasury and financing and on my behalf i would like also to thank the shareholders and advisors for this uh and and and bankers, analysts for this period and I'm sure that our paths will still cross because I will continue on the board of Citicon and also for the next few months also as an advisor to the company. But back to the agenda of the daily agenda. And net rental income, first of all, as Eshel mentioned, we ended up at 2.5 million below at 52.2 on a quarterly basis, which was actually a good achievement, taking into account that we disposed assets and as As Echelle mentioned, it was a solid quarter operationally, and our rents continued to grow. We had like-for-like rental growth for the quarter of 6.8%, also a very solid number. And for the first nine months, our like-for-like net rental income growth was 5.7%. Our operating profit for the first nine months was actually very close to previous year's level, very close to 24 level, due to the fact that last year in 24, we had clearly bigger restructuring costs. The EPRA EPS, we generated 13 cents for the quarter, which was very close, or actually the same as last year. And EPRA EPS excluding hybrid bond costs for the quarter was 17 compared to the 18 last year. And for the first nine months, those numbers were 33 cents for the first nine months. And EpreEPS excluding hybrid bond costs, 47 cents. Solid numbers altogether. Then about the more detailed EPRA earnings bridge. First of all, for the first nine months, you can see that the net rental income was 5.1 million below. But that was more than compensated on SG&A, which was lower by 5.7 million for the first nine months. But as mentioned, this number includes quite substantial restructuring costs. Last year and this year, in 2025, we obviously had clearly less of those. Then, hybrid bond interests for the nine months are higher now, because we refinanced and exchanged our first hybrid as part of our balance sheet de-risking and refinancing, which we have been quite active in doing, and we ended up at 59.9 million as a total nine months' EIPRA earnings. For the quarterly, net rental income was 2.7 million below, but again, we need to keep in mind that we disposed assets in 2024, and we had a strong rental growth during the quarter due to the good like-for-like performance. And the financial income and expenses were actually on a quarterly level, very close to previous year's level. Financial income and expenses was actually 500,000 lower than last year, and hybrid bond interests also. And these numbers demonstrate that we have quite well already absorbed much of the impact of the refinancing of the old legacy low-coupon bonds. Then the next topic is the property valuation, and Q3, as per usual, was an internal valuation quarter. We did receive and we asked, as usual, the opinion from our regular advisors, appraisers, JLL for Finland and Sweden, CBRE for Norway, Estonia and Denmark, We have their confirmation that there were, in their opinion, no substantial changes in the cap rates during the quarter. So we just updated our rent roll and OPEX for the calculations. and the valuation ended up at a positive 8.6 million for the quarter, and naturally, as we did not touch the cap rates, the average yield requirement stayed at 6.2% on average. Then briefly about the very proactive debt management that we have maintained under the entire 2025, So, we have completed a total of more than 750 million of debt repayments and tenders, and all of these have one thing in common. We have refinanced the short-maturing debt and extended the debt maturity and thereby de-risk the balance sheet, and this is a work that I'm sure that will continue with at least the same activity by Hilik and his team going forward. During Q3, the most important achievement was the fact that we successfully refinanced and extended our revolving credit facility. We also increased that by 50 million to 250 million, and that is now completely undrawn, so provides additional liquidity and buffer for the years to come. And the maturity, as mentioned, was extended and is now maturing in 29. with the potential of one year extension until 2030. And here I would like to thank our relationship banks for their very good cooperation and trust in the company in extending this facility. But like I said, the work will continue, and the work will continue with my great successor, Hilik, and his team, and I wish Hilik all the success in his work, and over to you, Hilik, now.

Thank you, Errol, and a special big thanks for you for setting solid foundations. And I'm Chilik Attias. I'm the incoming CFO, and I'm happy to be here. I'm going to walk you through this next slides. So as of Q3 2025, our weighted average maturity was 3.7 and the weighted average interest rate is 4.04%. And it's worth mentioning that we have also 9.2 billion of unencumbered assets. and a strong covenant headroom that give us financial flexibility in the future you could see in the debt amortization schedule that is well staggered and we are in the preparation of the upcoming bond maturities of 300 million euros in september 2026 and january 2027 Our total available liquidity was 278.7 million, and this is before the closing of the secured RCF, which was increased by 50 million euros. As of our key credit metrics, as of Q3 2025, our loan-to-value was 46.9%. Our net debt to EBITDA was 9.6%. Our interest coverage ratio, 2.4%. And our weighted average interest rates, 4.04%, as mentioned. And, of course, we're in compliance with all of our covenants. As for the 2025 outlook, as usual, towards the year end, we are narrowing the outlook range. And you can see that our updated outlook is 0.41 to 0.46 for the APRA earnings per share, and 0.6 to 0.65 for the APRA earnings per share, excluding hybrids. And with that, I'll hand it over to Eshel to walk us through our way forward. Eshel, please.

Thank you, Chilik. Thank you, Eero. I will focus on the fourth quarter, what are our goals. We will be busy with budgeting and our operational assumption for the 2026 budget will be around two main components. The first one is a like-for-like net rental income growth, including special leasing, exceeding the CPI. and optimization and operational cost reduction. On the financing side, we will focus to continue to be further strengthening and the re-risking of the balance sheet. I want to thank you all again for your patience and we will exponentially not take live questions today. in this audio as we, me and Chirik, are fresh and not be able to answer your serious question in a serious matter. So we promise you to do that in our next meeting. I wish you all the best. Thank you very much, and have a nice weekend.