Financial
Review 2023
Lippulaiva residentials
Contents
About this report
Accounting principles and key estimates and
assumptions regarding business activities
are presented together with the relevant note.
The aim is to improve the presentation of how
operating result was formed, what assets were
used to achieve the business profits and how
business and asset transactions were financed.
The accounting principles have been marked with
a grey background.
Information on the key estimates and assumptions
have been marked with a beige background.
CFO Sakari Järvelä comments on significant
items during the reporting period.
Information to shareholders ..........................................................3
Citycon in brief ..................................................................................... 4
CEO’s interview .................................................................................... 5
Key figures ............................................................................................. 7
How we create value .........................................................................8
Report by the Board of Directors ................................................9
EPRA performance measures ................................................... 21
Operational key figures ................................................................. 28
(Re)development projects in progress .................................. 33
Risk and risk management ......................................................... 34
Shares and shareholders ............................................................. 36
Key figures and financial development for five years ...38
Formulas for key figures and ratios ........................................ 39
Citycon Oyj’s consolidated financial statements ���������41
Consolidated income statement, IFRS .................................. 41
Consolidated statement of other comprehensive
income, IFRS ....................................................................................... 41
Consolidated statement of financial position, IFRS ....... 42
Consolidated cash flow statement, IFRS ............................43
Consolidated statement of changes in
shareholders’ equity, IFRS ........................................................... 44
Notes to the consolidated financial statements �����������45
1� Operating performance ����������������������������������������������������� 47
1.1. Segment information ...............................................................47
1.2. Gross rental income ................................................................49
1.3. Revenue from contracts with customers .....................50
1.4. Property operating expenses ............................................. 51
1.5. Administrative expenses .......................................................52
1.6. Employee benefits and personnel expenses ..............52
1.7. Other operating income and expenses ......................... 55
1.8. Earnings per share .................................................................. 55
2� Property portfolio and assets �����������������������������������������55
2.1. Investment properties and related liabilities .............. 55
2.2. Investment properties held for sale ............................... 59
2.3. Right-of-use assets ............................................................... 60
2.4. Investments in joint ventures and associates ........... 61
3� Financing �������������������������������������������������������������������������������63
3.1. Equity ............................................................................................. 63
3.2. Net financial income and expenses ...............................64
3.3. Classification of financial instruments ........................65
3.4. Loans .............................................................................................67
3.5. Financial risk management ...............................................68
3.6. Derivative financial instruments....................................... 71
3.7. Commitments and contingent liabilities .......................73
3.8. Cash and cash investments ...............................................73
4� Other notes to the accounts �������������������������������������������� 73
4.1. Income taxes ...............................................................................73
4.2. Deferred tax assets and liabilities ................................... 74
4.3. Intangible assets ......................................................................75
4.4. Trade and other receivables ...............................................75
4.5. Trade and other payables ................................................... 76
5� Consolidation ������������������������������������������������������������������������ 77
5.1. Business combinations and goodwill .............................78
5.2. Acquisition of non-controlling interests ...................... 79
5.3. Related party transactions and changes in
group structure ................................................................................ 80
5.4. Changes in IFRS and accounting policies ................... 81
5.5. Events after the reporting date ......................................... 81
Parent company financial statements, FAS �������������������82
Notes to the parent company’s financial
statements, FAS ...............................................................................85
Signatures to the financial statements ................................89
Auditor’s report ................................................................................. 90
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Financial statementsFinancial review Financial Review 2023
Information to shareholders
Listing of Citycon’s shares
Citycon Oyj’s shares are listed on the Nasdaq Helsinki
Ltd. Large Cap list under the trading code CTY1S.
Citycon has one series of shares, and each share
entitles its holder to one vote at the General Meeting of
shareholders and to an equal dividend.
Annual general meeting
Citycon Oyj’s Annual General Meeting will be held on 19
March 2024 at 12:00 noon. The notice, topics discussed
in the meeting, proposals made for the Annual General
Meeting, as well as the instructions on how to register
will be found on Citycon’s website.
Shareholders wishing to attend the meeting must be
registered in Citycon’s shareholder register at Euroclear
Finland Ltd. on the record date 7 March 2024.
Changes of address
Shareholders are requested to notify their book-entry
account operator or Euroclear Finland Ltd., whichever
holds the shareholder’s book-entry account, of any
changes to their name or address.
Publication of financial information
Citycon publishes financial information in English and
Finnish. All materials are available on Citycon’s website.
Subscription to publications
Citycon’s financial reports, stock exchange releases and
press releases can be ordered by registering an e-mail
address on Citycon’s website at citycon.com/newsroom.
Investor relations contacts
Citycon’s Investor Relations function assists in all
investor relations related questions. The primary contact
is the Manager, Legal and Investor Relations, Valtteri Piri
(ir@citycon.com).
Asset distribution
The Board of Directors proposes to the Annual General
Meeting that the Board of Directors will be authorized
to decide on the distribution of assets from the invested
unrestricted equity fund.
Based on the proposed authorization, the maximum
total amount of equity repayment, shall not exceed 0.30
per share. Based on the current total number of issued
shares in the company, the authorization would equal
a maximum of EUR 51,598,261.2 in equity repayment.
The equity repayment would be paid to shareholders in
four installments.
Financial calendar 2024
Financial Statements Bulletin
and Financial Statements 2023 15 February
Interim Report
January–March 2024 15 May
Half-yearly Report
January–June 2024 17 July
Interim Report
January–September 2024 6 November
AGM record date
Last day for AGM registration
AGM
7 March
12 March
19 March
Preliminary payment date of equity repayment
1
28 March 2024
28 June 2024
30 September 2024
31 December 2024
More information:
Shares and shareholders, pages 36–37
1
Citycon’s Board of Directors will make separate resolutions and
announcements on each distribution of the dividend/equity
repayment subject to been authorized for asset distribution by
the Annual General Meeting.
3
Financial statementsFinancial review Financial Review 2023
Citycon in brief
2
3
2
4
5
2
5
We create cities full of life�
For people� For communities�
For development� For growth�
Citycon is the leading owner and developer of urban hubs in
the Nordics and Baltics. Our 33 mixed-use, necessity-based centres
are located in the major cities in Finland, Sweden, Norway, Denmark
and Estonia. We transform unique locations into sustainable
communities and cities full of life, serving 140 million people each
year and delivering long-term share value.
Tot a l
4.0
Billion
Balanced Nordic portfolio
%
1
Including Kista Galleria 50%.
Finland
Norway
Sweden
1
Denmark & Estonia
27%
11%
20%
42%
33
urban hubs
in 5 countries
serving 140 million
people each year�
Shopping centre
Bergen
Stockholm
Oslo
Gothenburg
Copenhagen
Helsinki
Tallinn
Denmark
& Estonia
4
urban hubs
Finland
9
urban hubs
Norway
14
urban hubs
Sweden
6
urban hubs
4
Financial statementsFinancial review Financial Review 2023
CEO’s interview
What were the highlights
of the year for you?
In 2023, we continued to demonstrate the strength
and stability of Citycon’s necessity-based strategy
regardless of macroeconomic pressures as our business
fundamentals remained and our assets continued to
perform very well. The positive operating results reflect
the quality of our grocery-anchored urban hubs, which
have a high proportion of necessity tenants, connected
to transportation and in convenient locations in the
largest Nordic cities. Our long-stated strategy of
creating mixed-use urban hubs is paying operational
dividends and driving traffic to our centers.
One of the highlights of the year was the opening
of three residential towers in Lippulaiva in the first
quarter of 2023. We are pleased with their leasing
progress as the occupancy rate of the residentials
is currently approx. 90%. These residential units will
create additional demand for the property and diversify
Citycon’s revenue streams. We have two additional
pads at this property where we are negotiating a joint
venture for development. Additionally, we reopened
Myyrmanni centre in Finland, which is our most recent
example of our strategy in action. In Myyrmanni, we
have further improved the tenant mix by increasing the
share of necessity-based tenants with a renewed Lidl
grocer and a 7,300 sq.m. Prisma hypermarket resulting
in groceries representing approx. 60% of the total
GLA. This is consistent with what we have achieved
in many of our properties across the portfolio. These
active asset management initiatives not only provide
stability to revenue growth, but it also has the added
benefit of improving the average credit profile of our
tenant base.
2023 was also the year where we continued our
progress to solidify our investment grade balance
sheet. We refinanced and expanded our credit facility
in April from EUR 500 million to EUR 650 million,
consisting of a EUR 400 million revolver and EUR 250
million term loan. With the proceeds we executed EUR
236 million bond repurchases for our bonds maturing
in the near future. We have continued to execute bond
repurchases from the open market, taking advantage
of discounts and dislocation in secondary trading while
improving the maturity profile.
In November, we executed approx. SEK 1,020 million
7-year mortgage loan secured by one of our Swedish
assets, highlighting Citycon’s access to debt financing
with competitive terms and providing evidence that the
secured loan market is functioning well. Additionally,
in Q4, we executed two hybrid exchanges where we
repurchased our hybrid bonds at a discount compared
to the nominal value in exchange for equity at the
current market value. Through these actions, we were
able to demonstrate our commitment to maintain
our investment grade credit rating and to continue
to mitigate the earnings impact of higher current
market interest rates, while also improving our overall
balance sheet.
We are pleased that these credit actions as well
as Citycon’s sound operating performance were
also recognized by S&P, who reaffirmed Citycon’s
investment grade rating with stable outlook.
We will continue to focus on
delivering on our strategy
of creating and operating
necessity-based retail hubs
in top Nordic locations�
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Financial statementsFinancial review Financial Review 2023
How would you describe Citycon’s
operational performance in 2023?
We continue to see strong performance in our business
fundamentals as sales, footfall, rents, occupancy
collections continue to show sustained growth. Like-
for-like tenant sales increased by 3.4% and like-for-
like footfall 1.8% compared to the previous year. This
combined with increasing average rent and occupancy
rate, you have the recipe for success.
We were pleased to see continued strong demand for
our centres from both new and existing tenants, as
evidenced by our excellent leasing activity with over
132,000 sq.m. of signed leases in 2023 with positive
leasing spreads of 1.4%, resulting in retail occupancy
up 60 bps to 96.0%. Notable, at the same time we were
able to increase the average rent per square meter in
comparable FX, by 1.6 EUR to 24.0 EUR/s.qm.
The net effect of these strong operational KPI’s is that
like-for-like net rental income grew 6.5% in 2023 (in
comparable FX). We benefited by the fact that 93% of
our leases are linked to indexation and stand to further
benefit in 2024. Our occupancy cost ratio remains one
of the lowest in the industry highlighting the health
of Citycon’s tenants. While tenant sales continue to
increase, this combination provides us with plenty of
headroom for compounding rent growth going forward.
How is the increasing focus on
sustainability impacting Citycon?
Citycon has been an early leader in the real estate
sector when it comes to sustainability, and we are fully
committed to deliver on our ambitious sustainability
goals, namely carbon neutrality by 2030 and to
reduce greenhouse gas emissions in line with the
1.5°C Paris goal. Alongside with our company level
targets, sustainability is embedded in our operations
at every step of the process and in 2023, all Citycon
employees had a sustainability linked target in their
bonus criteria. To underline our commitment to the
long-term sustainability promises, we updated our
sustainability strategy in May 2023. The updated
sustainability strategy enables the company to work
effectively on multiple areas towards its ambitious
goals for 2030.
Our long-term sustainability work is also contributing
to our financial performance in the current more volatile
energy cost environment, as Citycon has a significant
amount of its own onsite energy production at our solar,
geothermal, and hydrothermal powerplants. Going
forward we will continue to seek to invest in sustainable
solutions through a variety of measures to improve our
centers, our urban hubs and the communities in which
we operate.
As a result of our ambitious sustainability work, Citycon
has once again received recognition for our efforts
to reduce the greenhouse gas emissions by being
named among Europe’s Climate Leader companies by
Financial Times.
What are Citycon’s
focus areas for 2024?
Moving forward into 2024, we will continue to focus
on delivering on our strategy of creating and operating
necessity-based retail hubs in top Nordic locations.
We remain confident about the business as we own
quality real estate, we provide the consumer the
goods and services they require, and we provide an
environment that is convenient to access. When you
layer in the dramatic impact of compounding rent
growth, you have created extreme strong and stable
business fundamentals.
The balance sheet will remain a key focus for us
in 2024. We will continue to actively work towards
further strengthening our financial position and we
will continue our capital recycling. Our confidence in
the reopening of the transaction markets leads us to
increase our EUR 380 million divestment target by
the end of 2024 to EUR 950 million within the next
24 months. In 2023, we demonstrated our access to
debt financing with competitive terms which gives us
flexibility to we be patient as the Nordic transaction and
bond market stabilizes.
In 2024, we will intensify our focus on cost control
and profitability in all our business operations. To
that end we will reduce our operating cost as well as
dramatically decrease our G&A expenses to a run rate
of 10% of net rental income by year-end 2024. We will
also consolidate corporate Nordic functions into our
existing office in suburban Helsinki. It is also important
to note that, following the completion of the residential
towers in Lippulaiva in Q1/2023, we now have minimal
committed capital expenditures which will be approx.
EUR 30 million in 2024 (70% lower in 2024 than in
2023). We will also complete some existing projects
including a 7,300 sq.m. Prisma in Myyrmanni, a new
Selver grocery and gym in Rocca al Mare, a new Lidl
grocery in Albertlund and finally the first Nike Rise in
Finland in Iso Omena.
Lastly, I would like to highlight that there is a scarcity of
the type of high-quality retail assets we own, we have a
proven business model and all of the important metrics
(sales, footfall, rents, occupancy, collections) continue
to show sustained growth. For all of these reasons,
we remain bullish on the prospects of the business
moving forward.
F� Scott Ball
CEO
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Financial statementsFinancial review Financial Review 2023
Key figures
Key figures 2023 2022
Net rental income, MEUR 195.7 203.6
Like-for-like net rental income growth 6,5% 6,6%
EPRA Earnings per share (basic) 0.651 0.730
EPRA NRV per share 9.30 11.01
Average interest rate 2.61% 2.43%
Tot a l
195.7
MEUR
Net rental income by segments
MEUR
Finland
Norway
Sweden
Denmark & Estonia
Other
76.4
29.3
-0.4
62.5
27.8
Q1
2023
Q2
2023
Q3
2023
Q4
2023 2023
Rent collection rate
%
98%
99%
99%
99%
99%
2021 2022 2023
Tenant sales development
1
%
Like-for-like
Total
1
Sales figures include estimates. Sales figures exclude VAT and the change
has been calculated using comparable exchange rates. Kista Galleria 50%
not included.
5.2
3.4
-0.4
-1.1
3.8
-1.5
2021 2022 2023
Like-for-like net rental income
development
%
-1.5
6.6
6.5
Like-for-like NRI development (at comparable FX rates)
2022 Q3 2023 Q4 2023
Retail occupancy rate
1
%
96.0
95.6
95.4
1
Kista Galleria 50% not included.
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Financial statementsFinancial review Financial Review 2023
How we create value
How we create value?
Focusing on prime assets that we...
Assets in Nordic
prime locations
• Top 2 cities in each
country with strong
urbanisation
• Connection to public
transportation
Necessity-
based tenant mix
• Grocery anchored centres,
a large share of necessity
tenants
• Mixed-use hubs with
growing share of
municipalities
Proven asset
management
• Long lasting relationship
with municipalities
• Continued dialogue with
surrounding communities
• Sustainability embedded
in the operating model
Active capital
recycling
• Proceeds used to
repay debt
• Strengthen investment
grade balance sheet
Inherent building rights
• Mainly residential, which will
enhance value of underlying
center
• Minimal capex required to
get zoning
• Multiple value extraction
paths via sale, JV or build
Citycon – urban
convenience in the
heart of communities
…own,
• Strong portfolio of 33
convenience based centres
• Located in growing urban areas
in Nordic and Baltic cities
• Long-term investor
…manage,
• In-house real estate expertise
throughout the centre value chain
• Retail experts in 5 countries
• Pan-Nordic approach with
synergies and a cross-border
leasing team
…develop.
• Area development – creating
attractive places for living,
working and socializing
• Improved commercial
attractiveness and
competitiveness and better
places for our tenants to operate
We bring value to communities by developing urban hubs for
living, working, socialising and shopping. We have extensive
experience as an urban developer and use our expertise
when we create mixed-use centres that include retail, offices,
hotels, housing, food & beverage as well as healthcare,
culture and leisure services.
A stable core
business with
attractive
opportunities for
value creation
8
Financial statementsFinancial review Financial Review 2023
Report by the Board of Directors
Citycon continued to demonstrate the strength and
stability of its Nordic portfolio. Citycon’s operational
performance showed continued improvement
throughout the year as like-for-like net rental income
increased by 6.5%. The overall financial performance
remained solid in 2023 and reported Direct Operating
Profit, EPRA Earnings per share, and Adjusted EPRA
Earnings per share were EUR 164.8 million, EUR 0.651,
and EUR 0.479, respectively. Rent collection rate was
high at 99% for 2023 and reflects the high quality
and creditworthiness of Citycon’s tenants. Combined
with Citycon’s low occupancy cost ratio (9.5%) and
increasing tenant sales, there is ample headroom for
rent indexations also in 2024.
Like-for-like tenant sales increased 3.4% and like-for-
like footfall 1.8% compared to the previous year. Like-
for-like tenant sales are already well above (9.2%) 2019,
which demonstrates the strength of Citycon’s strategy
to focus on grocery-anchored urban hubs, which
have a high proportion of tenants providing necessity
goods and services, connected to transportation and in
convenient locations in the largest Nordic cities.
Citycon continued its active capital management and
further improved its financial position by refinancing and
expanding its credit facility in April from EUR 500 million
to EUR 650 million, issuing a new SEK 1,020 million
term loan in November and executing two hybrid-equity
exchanges in Q4. Importantly, Citycon executed EUR
191 million notional bond repurchases during the year
and retired EUR 87 million of hybrid debt. Through these
actions Citycon continued to mitigate the earnings
impact of higher current market interest rates, while
also improving its overall balance sheet. Citycon’s credit
actions and sound operating performance were also
recognized by credit agencies as, in December, S&P
reaffirmed Citycon’s investment grade rating with stable
outlook.
Main events in 2023
General:
• Citycon continued to demonstrate strong operational
performance amidst an uncertain macroeconomic
environment.
• Citycon announced a new sustainability strategy
which enables the company to work effectively on
multiple areas towards its ambitious goals for 2030.
• Citycon was selected as one of Europe’s Climate
Leaders for the third consecutive year according to
the list drafted by the Financial Times and German
research company Statista. Citycon is the only Finnish
real estate company included in the list and was in the
top quarter of all European companies, regardless of
sector.
• Sakari Järvelä was appointed Citycon Oyj’s Chief
Financial Officer and member of the Corporate
Management Committee as of 1 February 2024.
Key Figures
Citycon Group
1
2023 2022 % FX Adjusted %
2
Net rental income MEUR 195.7 203.6 -3.9% 1.7%
Like-for-like net rental income development % 6.5% 6.6% - -
Direct operating profit
3
MEUR 164.8 175.2 -5.9% -0.1%
IFRS Earnings per share (basic)
4
EUR -0.70 -0.15 - -
Fair value of investment properties MEUR 3,858.2 4,040.1 -4.5% -
Loan to Value (LTV)
3
% 46.3 41.4 11.8% -
EPRA based key figures
3
EPRA Earnings MEUR 109.6 122.6 -10.7% -4.3%
Adjusted EPRA Earnings
5
MEUR 80.6 92.1 -12.5% -3.9%
EPRA Earnings per share (basic) EUR 0.651 0.730 -10.8% -4.4%
Adjusted EPRA Earnings per share (basic)
5
EUR 0.479 0.548 -12.6% -4.1%
EPRA NRV per share
6
EUR 9.30 11.01 -15.5% -
1
The numbers include the sale of four investments properties during the previous year.
2
Change from previous year (comparable exchange rates). Change-% is calculated from exact figures.
3
Citycon presents alternative performance measures according to the European Securities and Markets Authority (ESMA) guidelines. More information is
presented in Basis of Preparation and Accounting Policies in the notes to the accounts.
4
The key figure includes hybrid bond coupons, amortized fees and gains and expenses on hybrid bond repayments.
5
The key figure includes hybrid bond coupons and amortized fees.
6
The effect of currency rates to EPRA NRV/share was EUR -0.47.
Outlook for 2024
Direct operating profit MEUR 185–203
EPRA Earnings per share (basic) EUR 0.62–0.74
Adjusted EPRA Earnings per share (basic) EUR 0.46–0.58
The outlook assumes that there are no major changes in macroeconomic factors and no major disruptions from the war in Ukraine. These
estimates are based on the existing property portfolio, including Kista 100%, as well as on the prevailing level of inflation, the EUR–SEK and
EUR–NOK exchange rates, and current interest rates.
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Financial statementsFinancial review Financial Review 2023
Business environment
The Nordic economies, like the rest of the global
economy, are impacted by the increase in cost of
living and the uncertain economic environment due
to inflation, rising interest rates, and geopolitical
uncertainty. The common denominator for the Nordic
countries is their strong financial position, thanks to
high personal savings, strong public finances and robust
job creation, which continue to persist. This provides
these economies a buffer and some degree of resilience
during this time of inflation, and rising interest rates.
While inflation is trending higher in all Nordic markets,
this continues to benefit Citycon’s operations due to the
grocery and services-oriented tenant mix of Citycon’s
necessity-based urban hubs, which are less reliant on
consumer discretionary spending. In addition, 93% of
the Company’s leases are tied to indexation.
(Sources: SEB Nordic Outlook, European Commission,
CBRE, JLL, Statistics Finland/Norway/Sweden/Estonia/
Denmark, Eurostat)
Balance sheet:
• In total, Citycon repurchased EUR 191 million of
notional bonds in 2023 through tender offer and
from the open market by using approx. EUR 184
million of cash
• Additionally, Citycon retired EUR 87 million of
hybrid debt
• Repurchases further stabilizes Citycon’s well-
laddered maturity profile and reduces refinancing
risk
• Citycon replaced and extended of EUR 650 million
credit facility in April 2023, incl. EUR 250 million
term loan
• Citycon signed a SEK 1 020 million (approx. EUR
89.5 million) fixed rate green term loan in November
• Citycon updated its EUR 400 million Commercial
Paper programme into green format, and issued its
first Green Commercial Paper
• the first ever Green Commercial Paper issued in
the Finnish market
• S&P reaffirmed in December Citycon’s investment
grade rating with stable outlook.
• Citycon remains committed to its investment grade
credit rating.
Operational performance:
• Q1–Q4/2023 like-for-like tenant sales 3.4%.
• 9.2% vs. Q1–Q4/2019 (pre-pandemic)
• Q1–Q4/2023 LFL footfall 1.8%
• Q4/2023 retail occupancy 96.0%
• 40 bps vs. Q3/2023
• 60 bps increase vs. Q4/2022
• Q1–Q4/2023 collections were 99%
• Q1–Q4/2023 average rent per sqm increased EUR 1.6
to EUR 24.0 (comparable FX)
• Q1–Q4/2023 positive leasing spread of 1.4%
• Q4/2023 9.5% LFL occupancy cost ratio
Financial performance:
• Like-for-like net rental income in Q1–Q4/2023
increased 6.5%
• Total net rental income was EUR 195.7 million (Q1–
Q4/2022: EUR 203.6 million).
• EPRA Earnings were EUR 109.6 million (Q1–Q4/2022:
EUR 122.6 million). EPRA Earnings per share (basic)
was EUR 0.651 (Q1–Q4/2022: EUR 0.730)
• Adjusted EPRA earnings were EUR 80.6 million (Q1–
Q4/2022: EUR 92.1 million)
• IFRS earnings per share was EUR -0.70 (Q1–
Q4/2022: EUR -0.15). Net cash from operations per
share was EUR 0.75 (Q1–Q4/2022: EUR 0.59)
• The Board of Directors proposes to the Annual
General Meeting that the Board be authorised
to decide on the profit distribution. Based on the
proposed authorization the maximum amount of profit
sharing, to be paid as equity repayment, would be EUR
0.30 per share.
Business environment key figures
Finland Norway Sweden Denmark Estonia Euro area
GDP growth, 2023 -0.5% 0.5% -0.4% 1.0% -3.4% 0.5%
Unemployment, 2023 7.2% 3.6% 7.6% 4.8% 6.7% 6.5%
Inflation, 2023 4.3% 5.8% 8.5% 3.3% 9.1% 5.4%
Retail sales growth, 11/2023
1
-0.2% 0.4% 1.6% 1.3% -0.3% -0.3%
1
% change compared with the same month of the previous year
Sources: IMF, World Economic Outlook (October 2023), SEB Nordic Outlook, European Commission, Eurostat
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Financial statementsFinancial review Financial Review 2023
Net rental income
Like-for-like net rental income in Q4 increased 5.3%
compared to Q4/2022.
Like-for-like net rental income in Q1–Q4/2023 increased
by 6.5%.
Total net rental income for the period was EUR 195.7
million (Q1–Q4/2022: EUR 203.6 million, including
disposed assets).
Like-for-like net rental income from the Finnish
operations increased by 7.6% in Q1–Q4/2023. Like-
for-like net rental income from Norwegian operations
increased by 4.6% in Q1–Q4/2023. Like-for-like net
rental income from the Swedish operations increased by
1.3% in Q1–Q4/2023. Like-for-like net rental income from
the Danish & Estonian operations increased by 12.6% in
Q1–Q4/2023.
Occupancy, Sales and Footfall
The retail occupancy rate was 96.0% in Q4/2023 and
was 60 bps higher versus the same time last year
(Q4/2022: 95.4%). Economic occupancy for Q4/2023
was 94.9% (Q4/2022: 94.5%). Furthermore, the average
rent per sq.m. increased by 0.3 to 24.0 EUR (Q4/2022:
23.7 EUR). With comparable FX rates, average rent per
sq.m increased by 1.6 EUR. In Q1–Q4/2023 Citycon
leased over 132,000 sq.m. with a positive leasing spread
of 1.4%.
Like-for-like tenant sales increased 1.9% in Q4/2023 and
3.4% for Q1–Q4/2023 compared to the same time last
year. Notably, like-for-like tenant sales in Q1–Q4/2023
are up 9.2% compared to the same time period in 2019.
Like-for-like footfall increased by 1.4% in Q4/2023 and 1.8%
in Q1–Q4/2023 compared to the same period last year.
Net rental income and gross rental income breakdown
Net rental income
Gross rental
income
MEUR Finland Norway
2
Sweden
Denmark &
Estonia Other Total Total
2022 68�6 78�9 30�4 26�0 -0�3 203�6 222�3
(Re)development projects 4.0 -2.3 -0.9 - - 0.8 1.2
Divestments 0.0 -7.7 - - - -7.7 -8.2
Like-for-like properties
1
3.9 2.5 0.3 3.3 - 9.9 12.1
Other (incl. exchange rate differences) 0.0 -8.9 -2.0 0.0 -0.1 -11.0 -12.1
2023 76�4 62�5 27�8 29�3 -0�4 195�7 215�3
1
Like-for-like properties are properties held by Citycon throughout two full preceding periods and exclude properties under (re)development or extension.
2
NRI impacted by four assets sold in 2022.
Like-for-like and total net rental income development, 2023 vs. 2022
%
Like-for-like NRI Development
(at comparable exchange rates)
Total NRI Development
(at actual exchange rates)
Total NRI Development
(at comparable FX rates)
1
Total NRI impacted by disposals executed in 2022.
Finland Norway
1
Sweden
Denmark &
Estonia To ta l
1
6.5
-3.9
1.7
7.6
1.3
-8.5
-1.2
11.4
11.4
12.6
12.7
12.8
4.6
-20.8
-10.5
Personnel key figures
2023 2022 2021
FTE at the end of the reporting
period 234 251 242
Wages and salaries, EUR million 19.1 18.9 17.3
Financial result Q1–Q4/2023 vs.
Q1–Q4/2022
Operating profit was EUR -38.0 million (Q1–Q4/2022:
EUR 87.7 million).
Administrative expenses were EUR 31.1 million (Q1–
Q4/2022: EUR 28.7 million). At the end of the reporting
period, Citycon Group employed a total of 234 (31
December 2022: 251) full-time employees (FTEs) of
whom 43 worked in Finland, 75 in Norway, 39 in Sweden,
14 in Denmark & Estonia and 64 in Group functions.
Net financial expenses (IFRS) decreased slightly to
EUR 47.7 million (Q1–Q4/2022: EUR 48.0 million) mainly
following increased interest income on cash at bank and
income from hedging derivatives. Indirect one-off gains
of EUR 2.9 million from bond repurchases executed at a
discount was offset by EUR 2.8 million indirect loss (Q1–
Q4/2022: EUR 9.2 million loss) from hedging derivatives
not under hedge accounting and other indirect items.
Share of loss of joint ventures and associated
companies totalled EUR -36.7 million (Q1–Q4/2022:
EUR -24.6 million) mainly due to weaker development of
property fair values in joint venture Kista.
Profit for the period was EUR -115.0 million (Q1–
Q4/2022: EUR 5.1 million).
11
Financial statementsFinancial review Financial Review 2023
Tenant sales development, 2023 vs. 2022
1
%
1
Sales figures include estimates. Sales figures exclude VAT and the change has been calculated
using comparable exchange rates. Kista Galleria 50% not included.
Like-for-like sales
Total sales
(including impact of
divested assets)
4.1
6.3
2.7
-1.1
3.4
-10.2
5.5
1.2
5.5
1.1
Finland Sweden
Denmark
& Estonia
Norway Tot a l
Footfall development, 2023 vs. 2022
1
%
1
Footfall figures include estimates. Kista Galleria 50% not included.
Like-for-like footfall
Total footfall
(including impact of
divested assets)
5,2
7,9
0,5
0,2
1,8
-6,7
3,9
-3,2
3,9
-3,5
Finland Sweden
Denmark
& Estonia
Norway Tot a l
Occupancy rate
1
%
1
Kista Galleria 50% not included.
31 December 2022
31 December 2023
Retail occupancy rate
31 December 2023
Finland Sweden
Denmark
& Estonia
Norway Tot a l
95.4
93.4
93.8
95.5
94.5
95.0
95.2
92.4
97.2
94.9
96.0
Lease portfolio summary
1
31 December
2023
31 December
2022
Number of leases pcs 3,371 3,191
Average rent
EUR/sq.m./
month 24.0 23.7
Average remaining
length of lease
portfolio years 3.6 3.4
Occupancy cost
ratio
2
% 9.5% 9.2%
Leasing Spread % 1.4% 2.0%
1
Kista Galleria 50% not included.
2
The rolling twelve month occupancy cost ratio for like-for-like shopping
centres.
Leasing activity
1
2023 2022
Total area of leases started sq.m. 236,923 262,772
Total area of leases ended sq.m. 237,608 302,490
1
Leases started and ended do not necessarily refer to the same premises.
Kista Galleria 50% not included.
At period-end, Citycon had a total of 3,371 (3,191)
leases, of which the average remaining length was
3.6 years (3.4).
12
Financial statementsFinancial review Financial Review 2023
Property portfolio summary
31 December 2023
No� of
properties
Gross
leasable area
Fair value,
MEUR
Properties held
for sale, MEUR Portfolio, %
Shopping centres, Finland 9 336,850 1,683.9 44%
Other properties, Finland 1 2,240 4.4 0%
Finland, total 10 339,090 1,688�3 44%
Shopping centres, Norway 13 342,600 1,077.1 28%
Rented shopping centres, Norway
1
1 14,500 - -
Norway, total 14 357,100 1,077�1 28%
Shopping centres, Sweden 5 173,400 610.8 16%
Other properties, Sweden 1 - 6.7 - 0%
Sweden, total 6 173,400 617�5 16%
Shopping centres, Denmark & Estonia 4 141,900 434.8 11%
Other properties, Denmark & Estonia - - - - -
Denmark & Estonia, total 4 141,900 434�8 11%
Shopping centres, total 32 1,009,250 3,806.6 99%
Other properties, total 2 2,240 11.1 0%
Investment properties, total 34 1,011,490 3,817�7 99%
Right-of-use assets classified as
investment properties (IFRS 16) - - 40.5 1%
Investment properties in the statement of
financial position, total 34 1,011,490 3,858�2 100%
Kista Galleria (50%) 1 46,250 173.2 -
Investment properties and Kista Galleria
(50%), total 35 1,057,740 4,031�4 -
1
Value of rented properties is recognised within IFRS 16 investment properties based on IFRS rules.
Fair value changes
MEUR 2023 2022
Finland -68.4 -15.3
Norway
1
-64.5 -26.5
Sweden -35.3 -5.0
Denmark & Estonia -25.5 -3.0
Investment properties, total -193�7 -49�8
Right-of-use assets classified as investment properties (IFRS 16) -6.6 -6.8
Investment properties in the statement of financial position, total -200�3 -56�5
Kista Galleria (50%) -40.8 -25.5
Investment properties and Kista Galleria (50%), total -241�1 -82�0
1
Includes EUR -21.0 million (EUR -15.9 million) Torvbyen fair value impact as a result of a closure for structural damage.
Property portfolio value development
From year-end, the fair value of investment properties
decreased by EUR 181.9 million to EUR 3,858.2
million (31 December 2022: EUR 4,040.1 million). Net
investments, including both acquisitions and disposals
and development projects increased the fair value by
EUR 92.8 million. In addition, changes in right-of-use
-assets increased the value of investment properties
by an additional EUR 1.8 million. Fair value losses
decreased the value of investment properties by EUR
200.3 million and exchange differences by EUR 76.2
million.
Q1–Q4/2023 fair value change of investment properties
amounted to EUR -200.3 million (Q1–Q4/2022:
EUR -56.5 million) mainly due to increase in yield
requirements in all segments. In addition, fair value
change includes EUR -21.0 million (EUR -15.9 million)
Torvbyen fair value impact as a result of a closure of the
center for structural damage. The application of IFRS
16 standard had an impact of EUR -6.6 million (Q1–
Q4/2022: EUR -6.8 million) to the fair value change of
investment properties during the January–December
reporting period.
External appraisers, CBRE (in Denmark, Estonia and
Norway) and JLL (in Finland and Sweden) measure the
fair values for annual financial statements. Citycon
measures the fair values of the properties internally in
the Q1–Q3. All internal valuation periods are subject to
yield and market commentary from Citycon’s current
external appraisers in its respective markets.
CBRE’s and JLL’s valuation statements are available on
Citycon’s website below Investors.
13
Financial statementsFinancial review Financial Review 2023
Capital recycling
No transaction activity occurred in Q1–Q4/2023.
Strengthening the balance sheet remains a key priority
for the company. In November 2022, Citycon announced
its goal to sell EUR 500 million of non-core assets in
the next 24 months. Following the transaction executed
in December 2022 the remaining target is EUR 380
million. Citycon is committed to execute the previously
disclosed divestment target by the end of 2024 and
have increased its target to EUR 950 million over the
next 24 months.
(Re)development projects
Further information on the company’s completed,
ongoing and planned (re)developments can be found on
page 33 in the Financial Review 2023.
Shareholders’ equity
Equity per share was EUR 11.56 (31 December 2022:
EUR 13.75). Loss for the period, hybrid bond repayments,
paid equity return and translation losses decreased
equity per share.
At period-end, shareholders’ equity attributable to
parent company’s shareholders was EUR 1,380.1 million
(31 December 2022: EUR 1,618.8 million).
(Re)development projects in progress on 31 December 2023
Location Area before/ after, sq�m�
Expected net
investment, MEUR
Actual gross investment
by 31 December 2023,
MEUR Completion
Herkules, residentials
(50%) Skien, Norway -/7,600 28.0 10.5 2024
Barkarby, residentials Stockholm, Sweden -/12,950 69.5
1
6.6
1
2024
1
The transaction has been structured as a forward commitment, whereby Citycon made a deposit of EUR 6.6 million in April 2022 and will fund the remaining
purchase price, pro-rata, at the completion of two construction phases in Q1/2024 and Q2/2024. The closing of the transaction will be after the completion of
each phase with no additional obligations from Citycon before construction of each phase is complete.
Completed (re)development projects in 2023
Location Area before/ after, sq�m�
Actual gross investment
by 31 December 2023,
MEUR Completion
Lippulaiva
residentials
Helsinki metropolitan
area, Finland -/12,800 61.3 Q1/2023
Capital expenditure
MEUR 2023 2022
Acquisitions of properties
1
- 6.3
Acquisitions of and investments in joint ventures - 0.4
Property development
2
92.8 165.7
Other investments 3.1 4.6
Total capital expenditure incl� acquisitions 95�9 177�0
Capital expenditure by segment
Finland 46.6 111.6
Norway 21.2 32.1
Sweden 15.1 19.8
Denmark & Estonia 11.0 9.7
Group administration 2.0 3.9
Total capital expenditure incl� acquisitions 95�9 177�0
Divestments
3 4
- 292�0
1
Capital expenditure takes into account deduction in the purchase price calculations and FX rate changes.
2
Comprised mainly of investments in Lippulaiva in 2022.
3
Excluding transfers into ‘Investment properties held for sale’ -category.
4
Divestments in 2022 comprise of sale of four non-core centres in Norway and two companies included in Lippulaiva centre in Finland.
14
Financial statementsFinancial review Financial Review 2023
Key financing figures
MEUR 31 December 2023 31 December 2022
Nominal debt outstanding MEUR 1,840.4 1,781.7
Interest-bearing liabilities, carrying value
1
MEUR 1,864.4 1,807.7
Available liquidity MEUR 434.3 577.7
Average loan maturity years 2.7 3.2
Loan to Value (LTV)
2
% 46.3 41.4
Interest cover ratio (financial covenant > 1.8) x 3.7 4.0
Net debt to total assets (financial covenant < 0.60) x 0.44 0.39
Solvency ratio (financial covenant < 0.65) x 0.45 0.40
Secured solvency ratio (financial covenant < 0.25) x 0.08 0.00
1
Including EUR 38.8 million (Q4/2022: EUR 42,8 million) IFRS 16 lease liabilities.
2
Hybrid bond treated as equity as according to IFRS. Excluding both right-of-use assets recognized as part of investment properties, as well as lease liabilities
pertaining to these right-of-use assets, which are based on IFRS 16 requirements.
Financing
In January, Citycon executed a tender offer of the 2024
notes and the two capital securities issued in 2019 and
2021. The company announced that it accepted an
aggregate amount of EUR 57.4 million of the principal
amounts outstanding on the three tendered securities
for repurchase, for a total purchase consideration of
EUR 41.4 million.
In March, the company returned to repurchase bonds at
an attractive price in the open market. In total, EUR 22.5
million of the company’s 2024 notes were repurchased
in the open market.
In April, the company signed a total of EUR 650 million
new committed syndicated multicurrency credit facility,
to replace and extend its existing EUR 500 million
facilities maturing in May 2024. The new facility consists
of a EUR 400 million revolving credit facility and a EUR
250 million term loan, and is fully secured by Iso Omena
and four Norwegian assets.
In May, the company deployed part of the funds from the
new term loan in a public tender offer to repay EUR 138.3
million of the 2024 notes. Another EUR 80.0 million was
used to repay short term commercial paper over the
quarter.
In June, the company continued repurchasing bonds in
the open markets for a total notional of EUR 15.7 million.
Repurchases targeted all of the company’s outstanding
Eurobonds, of which EUR 9.0 million of the total notional
was related to the 2024 notes.
Furthermore Citycon terminated its credit rating
agreement with the rating agency Moody’s Investors
Service. The credit rating of Citycon continues to be
assessed by Standard & Poor’s, which in April affirmed
Citycon’s investment grade credit rating (BBB-/
stable outlook) highlighting Citycon’s strong operating
performance and stable credit metrics.
In September, the company repurchased senior bonds in
the open markets for a total notional of EUR 0.4 million
and hybrid bonds for a total notional of EUR 0.7 million.
The company also renegotiated and prolonged its SEK
3.3 billion position of EURSEK cross-currency swaps
and utilised the positive fair value in the existing hedging
derivatives to reduce the interest rate level paid in the
renewed hedges. The maturity of the cross-currency
swaps was prolonged from 2026 to 2028 and the
renewed hedges will earn an interest income of EUR 8.1
million annually compared to an annual interest income
of EUR 0.6 million before renewals.
In November, Citycon signed a SEK 1 020 million
(approx. EUR 89.5 million) fixed rate green term loan
with Deutsche Pfandbriefbank (pbb) and Landesbank
Hessen-Thüringen Girozentrale (Helaba). The maturity
of the term loan is 7 years and it is fully secured by
Liljeholmstorget Galleria in Stockholm, Sweden. The
funds were mainly used to repay the NOK 800 million
bond which matured in late November.
Furthermore, the company updated its EUR 2.5 billion
Euro Medium Term Note (EMTN) bond programme,
thereby being effective for another year. The programme
enables Citycon to raise bond financing in any currency
on the European and Nordic capital markets.
In addition, the company completed a directed share
issue in exchange for repurchasing certain of its
hybrid bonds for EUR 14.7 million. A total of 2,774,398
shares were subscribed for in the share issue and
the subscription price was EUR 5.30 per share. The
Company repurchased the 2024 Hybrid Bonds for a
repurchase price equalling approximately 84 percent.
The main purpose of the transaction was to strengthen
the Company’s balance sheet and improve its capital
structure.
In December, the company completed another directed
share issue in exchange for repurchasing certain of its
hybrid bonds for EUR 6.4 million. A total of 1,210,866
shares were subscribed for in the share issue and
the subscription price was EUR 5.30 per share. The
Company repurchased the 2024 Hybrid Bonds for a
repurchase price equalling approximately 84 percent.
The main purpose of the transaction was to strengthen
the Company’s balance sheet and improve its capital
structure.
On December 19, S&P Global Ratings reaffirmed
Citycon’s investment grade rating (BBB-) and kept
its Stable outlook unchanged citing Citycon’s sound
operating performance to continue over the next
24 months due to positive indexation and robust
occupancy rates. S&P noted they expect to see
Citycon’s credit metrics remaining within their rating
thresholds and that Citycon’s liquidity and funding
position remains solid, with expected asset disposals
to improve weighted average debt maturity over the
coming months.
The Annual General Meeting authorized the Board
of Directors to decide quarterly in its discretion on
the distribution of equity repayment with an annual
maximum total amount of EUR 0.50 per share. The
equity repayment paid in March, June, September and
December were mainly financed by operative cash flow.
15
Financial statementsFinancial review Financial Review 2023
Tot a l
1,840.4
MEUR
Breakdown of loans
%
Bank loans
Bonds
Commercial papers
78.9%
18.6%
2.6%
2024 2025 2026 2027 2028 2029 2030
400
250
205
310
47
350
242
345
92
Debt maturities
MEUR
Bank loans 341.9
Bonds 1,451.5
Commercial papers 47.0
Undrawn committed credit facilities 400.0
Financial expenses key figures
MEUR 2023 2022
Financial expenses
1
MEUR -61.2 -64.7
Financial income
1
MEUR 13.5 16.7
Net financial expenses (IFRS) MEUR -47�7 -48�0
Direct net financial expenses (EPRA) MEUR -47.7 -47.0
Weighted average interest rate
2
% 2.61 2.43
Weighted average interest rate excluding derivatives % 3.13 2.57
Year-to-date weighted average interest rate
2
% 2.57 2.42
1
The foreign exchange differences are netted in the financial expenses
2
Including interest rate swaps and cross-currency swaps
Interest-bearing debt
The outstanding amount of interest-bearing debt
increased in 2023 by EUR 58.7 million to EUR 1,840.4
million, as part of the new financing was used to
repurchase hybrid debt, offset by weakening of the NOK
currency rate. The carrying amount of interest-bearing
liabilities in the balance sheet was EUR 1,864.4 million
including IFRS 16 liabilities of EUR 38.8 million.
The weighted average loan maturity decreased during
the quarter and stands at 2.7 years. LTV (IFRS) increased
during the quarter to 46.3% as a result of decreased
property values and slightly higher net debt.
Financial expenses
The direct net financial expenses (EPRA) Q1–Q4/2023
were EUR 0.8 million higher than last year. Increased
interest cost on debt was largely offset by interest
income on hedging derivatives.
Net financial expenses (IFRS) decreased slightly to
EUR 47.7 million (Q1–Q4/2022: EUR 48.0 million) mainly
following increased interest income on cash at bank and
income from hedging derivatives. Indirect one-off gains
of EUR 2.9 million from bond repurchases executed at a
discount was offset by EUR 2.8 million indirect loss (Q1–
Q4/2022: EUR 9.2 million loss) from hedging derivatives
not under hedge accounting and other indirect items.
The financial income mainly consisted of interest
income on a loan to Kista Galleria and indirect one-off
gains on bond repurchases at a discount. The foreign
exchange differences are netted in financial expenses in
the table above.
The period-end weighted average interest rate was
2.61%.
Financial risk management
Citycon uses interest rate swaps to hedge the floating
interest rate risk exposure. According to the company’s
treasury policy, the currency net transaction risk
exposure with profit and loss impact is fully hedged
through currency forwards and cross-currency swaps
that convert EUR debt into SEK and NOK.
Changes in corporate management
On 1 December 2023, Chief Financial Officer Bret
McLeod announced his intention to resign from his
position effective January 31, 2024. At the same
time, the Board of Directors of Citycon unanimously
appointed Sakari Järvelä, VP, Corporate Finance and
Investor Relations, to the position of CFO and a member
of Citycon’s Corporate Management Committee as of
February 1, 2024.
After the reporting period, Kirsi Simola-Laaksonen,
Citycon’s Chief Information Officer and member of the
Corporate Management Committee informed that she
has decided to leave the company as of February 29,
2024.
16
Financial statementsFinancial review Financial Review 2023
Citycon uses BREEAM In-Use to assess and develop the
sustainable management of its shopping centres. 81% of
Citycon’s shopping centres, measured by fair value, had
acquired the certification at period-end.
Disclosure according to the Taxonomy Regulation
Delegated Act:
Citycon’s sustainability and finance teams have
classified the company’s activities by mapping Citycon
group’s consolidated IFRS income statement accounts
based on whether they are covered by a NACE code
included in the Taxonomy. Based on this classification
97% of Citycon’s total turnover, 95% of capital
expenditure and 71% of operational expenditure is
derived from Taxonomy-eligible activities.
Citycon is not obliged to report information according
to the taxonomy regulation, and for that reason Citycon
does not report on the taxonomy alignment of the
company’s operations for the year 2023.
Risks and uncertainties
The most significant near-term risks and uncertainties
in Citycon’s business operations are associated with the
general development of the economy and consumer
confidence in the Nordic countries and Estonia, and
how this affects fair values, occupancy rates and rental
levels of the shopping centres and, thereby, Citycon’s
financial results. Increased competition locally or from
e-commerce might affect demand for retail premises,
which could lead to lower rental levels or increased
vacancy, especially outside capital city regions. Costs
of development projects could increase due to rising
construction costs or projects could be delayed due
to unforeseeable challenges. Rising interest rates
could also put pressure on investment yields, which
Sustainability
Citycon’s strategy is to be a forerunner in sustainable
shopping centre management. Citycon’s sustainability
strategy was updated in 2023 and Citycon has set
ambitious targets that extend to 2030.
In its sustainability reporting, Citycon applies the GRI
Standards, European Public Real Estate Association
(EPRA) Best Practice Recommendations on
Sustainability Reporting (3rd Edition) and Citycon’s
own internal reporting principles (Criteria). Citycon’s
sustainability strategy, targets and measures are
described in detail in the upcoming Sustainability
Accounts 2023.
Citycon’s Annual and Sustainability Report 2022 was
awarded as one of the best within the industry. Citycon
received the EPRA Gold Award in the Sustainability
Best Practices series for the tenth year in a row. Citycon
has received a rating of AA in the MSCI ESG Ratings
assessment. Citycon also has the ISS-Oekom “Prime”
rating, awarded to companies that achieve the best ESG
scores among their sector peers.
Key environmental indicators 2023:
• Citycon’s total energy consumption (incl. electricity
consumption in common areas, heating and cooling)
amounted to 246 gigawatt hours (Q1–Q4/2022: 263
GWh). Shopping centre energy intensity (kWh/sq.m)
decreased by 4% compared to previous year.
• The carbon footprint totalled 5,425 thousand carbon
equivalent tonnes (Q1–Q4/2022: 5,108 tCO
2
e). The
carbon intensity of shopping centres is 3 kgCO
2
e/sq.m
that is the same than previous years.
• The recycling rate in shopping centres remained at the
same level as the previous year and was 99%.
could potentially impact fair values. The war in Ukraine
continue to pose risks to economic health in Europe as
well.
The main risks that can materially affect Citycon’s
business and financial results, along with the main risk
management actions, are presented in detail on pages
68–70 in the Financial Statements 2023, in Note 3.5
A) as well as on Citycon’s website in the Corporate
Governance section.
Legal proceedings
Certain lawsuits, claims and legal disputes based on
various grounds are pending against Citycon relating to
the company’s business operations. In the company’s
view, it is improbable that the outcome of these lawsuits,
claims and legal disputes will have a material impact on
the company’s financial position.
General meeting
Annual General Meeting 2023
Citycon’s Annual General Meeting 2023 (AGM) was
held virtually, without a meeting venue using remote
connection in real time on 21 March 2023. The General
Meeting approved all the proposals made by the Board
of Directors to the General Meeting. The AGM adopted
the company’s Financial Statements and discharged the
members of the Board of Directors and the CEO from
liability for the financial year 2022 and decided to adopt
the Remuneration Report for the governing bodies.
The General Meeting decided that no dividend is
distributed by a resolution of the AGM and authorised
the Board of Directors to decide in its discretion on the
distribution of assets from the invested unrestricted
equity fund. Based on the authorisation, the maximum
amount of equity repayment to be distributed from
the invested unrestricted equity fund shall not exceed
EUR 0.50 per share. The authorisation is valid until the
opening of the next AGM.
The AGM decisions and the minutes of the AGM are
available on the company’s website at
citycon.com/agm2023.
Extraordinary General Meeting 2023
Citycon’s Extraordinary General Meeting (EMG) held
on 1 June 2023 decided to increase the number of
members of the board to nine (9) until the close of the
next Annual General Meeting. Further, Mr Adi Jemini
was elected as new member of the Board of Directors.
Further information available on the company’s website
at citycon.com/egm2023.
17
Financial statementsFinancial review Financial Review 2023
Board of Directors
Under the Articles of Association, the Board of Directors
of the company consists of a minimum of five and a
maximum of ten members, elected by the General
Meeting for a term of one year that will end at the close
of the following Annual General Meeting.
The AGM resolved the number of members of the Board
of Directors to be eight. Chaim Katzman, Yehuda (Judah)
L. Angster, F. Scott Ball, Zvi Gordon, Alexandre (Sandy)
Koifman, David Lukes, Per-Anders Ovin and Ljudmila
Popova were re-elected to the Board of Directors.
Citycon’s EGM 2023 set the number of Board members
at nine. Mr Adi Jemini was elected as new member of the
Board of Directors.
Chaim Katzman was the Chairman of the Board of
Directors in 2023 Alexandre (Sandy) Koifman and F.
Scott Ball were Vice Chairmen of the Board of Directors.
Auditor
Since 2006, the company’s auditor has been Ernst
& Young Oy, a firm of authorised public accountants,
which had designated Authorised Public Accountant
Antti Suominen to act as the responsible auditor of
Citycon in 2023.
Chief Executive Officer (CEO)
From 1 January 2019 onwards, F. Scott Ball has been
the company’s CEO. Mr Ball’s personal details, career
histories and positions of trust can be found on the
company’s website at citycon.com/management.
Information on the CEO’s executive contract and its
terms and conditions are available on pages 52–54 of
the Financial Statements.
Shareholders 31 December 2023
% of shares and voting rights
Nominee-registered
shareholdings
(120.8 million shares)
Directly registered
shareholdings
(51.2 million shares)
70.2%
29.8%
Shares and share capital
MEUR 2023
Share capital at period-start MEUR 259.6
Share capital at period-end MEUR 259.6
Number of shares at period-start 168,008,940
Number of shares at period-end 171,994,204
Corporate governance statement
Citycon has published Citycon Group’s Corporate
Governance Statement 2023 as a separate report,
distinct from the Report by the Board of Directors.
The statement is prepared in accordance with the
recommendations of the Finnish Corporate Governance
Code 2020 and is available on the company’s website at
citycon.com/corporate-governance.
Shares, share capital and shareholders
The company has a single series of shares, with each
share entitling to one vote at a General Meeting of
shareholders. At the end of reporting period, the total
number of shares outstanding in the company was
171,994,204. The shares have no nominal value.
At the end of December 2023, Citycon had a total
of 27,738 registered shareholders (Q4/2022: 28,817
shareholders), of which 9 were account managers of
nominee-registered shares. Holders of the nominee-
registered shares held approximately 120.8 million
(Q4/2022: 116.3 million) shares, or 70.2% of shares and
voting rights in the company (Q4/2022: 69.2%).
Directed share issue in exchange
for repurchasing hybrid bonds
On 28 November 2023, Citycon’s Board of Directors
resolved, pursuant to the authorisation granted by the
Annual General Meeting, on a directed share issue of up
to 2,774,398 new shares of the company to hybrid bond
holder. A total of 2,774,398 shares were subscribed for
in the share issue. The subscription price was EUR 5.30
per share. Pursuant to the transaction, the subscription
price for the shares payable by the investor to the
company was set off against the repurchase price for
the 2024 hybrid bonds payable by the company to the
investor. Citycon repurchased the 2024 hybrid bonds
for an approximate aggregate price of EUR 14.7 million.
The repurchase price equalled to approximately 84.0
per cent of the principal amount of each of 2024 Hybrid
Bonds, excluding all accrued and unpaid interest on
such principal amount. The total number of Citycon
shares increased to a total of 170,783,338 shares.
On 20 December 2023, Citycon’s Board of Directors
resolved, pursuant to the authorisation granted by the
Annual General Meeting, on a directed share issue up
to 1,210,866 new shares of the company to certain
hybrid bond holders. A total of 1,210,866 shares were
subscribed for in the share issue. The subscription price
was EUR 5.30 per share. Pursuant to the transaction,
the subscription price for the shares payable by the
investors to the company was set off against the
repurchase price for the 2024 hybrid bonds payable
by the company to the investors. Citycon repurchased
the 2024 hybrid bonds for an approximate aggregate
price of EUR 6.4 million. The repurchase price equalled
to approximately 84.0 per cent of the principal amount
of each of 2024 Hybrid Bonds, excluding all accrued
and unpaid interest on such principal amount. The
total number of Citycon shares increased to a total of
171,994,204 shares.
The main purpose of the transactions was to strengthen
the company’s balance sheet and improve its capital
structure in the current market environment, while doing
so in a rapid and cost-effective manner that, in the
assessment of the company, would otherwise not be
available in the current market conditions. Additionally,
the capital structure and balance sheet strengthening
will also support the company in maintaining its
investment grade credit rating for the foreseeable future.
18
Financial statementsFinancial review Financial Review 2023
There are, therefore, weighty financial reasons for the
company to deviate from shareholders’ pre-emptive
subscription rights.
Further information of the company’s stock listing,
trading volume, share price, market cap, share capital,
most significant registered shareholders, of the
distribution of ownership and of the issue-adjusted
average number of shares can be found on pages
36–37 of the Financial Review.
Dividend and equity repayment
Citycon’s equity repayments paid in 2023:
Board authorisations
In addition to the above explained asset distribution
authorisation of the Board of Directors, the Board of
Directors of the company had two valid authorisations
at the period-end granted by the AGM held on 21 March
2023:
• The Board of Directors may decide on an issuance
of a maximum of 16 million shares or special rights
entitling to shares referred to in Chapter 10 Section 1
of the Finnish Companies Act, which corresponded to
approximately 9.52% of all the shares in the company
at the period-end. The authorisation is valid until the
close of the next AGM, however, no longer than until
30 June 2024.
• The Board of Directors may decide on the repurchase
and/or on the acceptance as pledge of the company’s
own shares in one or several tranches. The amount
of own shares to be repurchased and/or accepted
as pledge shall not exceed 30 million shares, which
corresponded to approximately 17.86% of all the
shares in the company at the period-end. The
authorisation is valid until the close of the next AGM,
however, no longer than until 30 June 2024.
During January–December 2023, the Board of Directors
used three times its authorisation to repurchase its
own shares and issue them by conveying repurchased
shares. The repurchases and conveyances were made
for payment of rewards earned under the company’s
share plans in accordance with the terms and conditions
of the plans:
Restricted Share Plan 2020–2022
• On 6 March 2023, the company repurchased a total
of 7,000 of its own shares and conveyed them on 9
March 2023 to four key persons of the company.
Performance Share Plan 2020–2022
• On 6 March 2023, the company repurchased a total
of 10,000 of its own shares and conveyed them on 9
March 2023 to two key persons of the company.
CFO Restricted Share Plan 2021–2024
• On 7 August 2023, the company repurchased a total
of 7,500 of its own shares and conveyed them on 10
August 2023 to the CFO of the company.
Own shares
During the reporting period, the company held a total
of 24,500 of the company’s own shares, which were
conveyed to implement payments of rewards earned
under the company’s share plans as described in the
section Board authorisations. At the end of the period,
the company or its subsidiaries held no shares in the
company.
Flagging notices
In Q1/2023, Citycon received in total five flagging
notifications (between 24 February and 10 March 2023)
due to a share purchase agreement entered into by
Gazit Europe Netherlands B.V. and its parent G City Ltd.
on 22 February 2023, according to which Gazit Europe
Netherlands B.V. purchased a total of 19,000,000
shares in Citycon from G City Ltd. The share purchase
agreement was published by flagging notification on
24 February 2023 and separate flagging notifications
for the partial executions were published on 3 March,
7 March, 9 March and 10 March 2023. The completion
of the share purchase agreement did not affect the
aggregate total direct and indirect holdings of G City Ltd.
in Citycon.
In Q2–Q3/2023, the company did not receive any
notifications of changes in shareholding.
On 27 December 2023 Citycon received a flagging
notification according to which G City Ltd.’s direct
holding of shares in Citycon has decreased below thirty
(30) percent. Due to the dilutive effect of the directed
share issue announced by Citycon Oyj on 20 December
2023 and completed on 22 December 2023, the direct
shareholding of G City Ltd. in Citycon Oyj decreased to
approximately 29.81% following the registration of the
new shares on 22 December 2023.
Dividends and equity repayments paid on 31 December 2023
1
MEUR Record date Payment date EUR / share
Equity repayment Q1 24 March 2023 31 March 2023 0.125
Equity repayment Q2 16 June 2023 26 June 2023 0.125
Equity repayment Q3 22 September 2023 29 September 2023 0.125
Equity repayment Q4 20 December 2023 29 December 2023 0.125
Total 0�50
1
Board decision based on the authorisation issued by the AGM 2023.
19
Financial statementsFinancial review Financial Review 2023
Incentive plans
Long-term Share-based Incentive Plans
Citycon has eight long-term share-based incentive plans
for the Group key employees:
• CEO Restricted Share Plan 2021–2025
• CEO Option Plan 2022–2025
• CFO Restricted Share Plan 2021–2024
• Performance Share Plan 2020–2022 (Corporate
Management Committee excl. the CEO)
• Performance Share Plan 2023–2025 (Corporate
Management Committee excl. the CEO)
• Matching Share Plan 2022–2024 (Corporate
Management Committee excl. the CEO)
• Restricted Share Plan 2020–2022 (Key employees,
excl. Corporate Management Committee) and
• Restricted Share Plan 2023–2025 (Key employees,
excl. Corporate Management Committee)
In February 2023, the Board of Directors approved two
new long-term share-based incentive plans: Performance
Share Plan 2023–2025 and Restricted Share Plan 2023–
2025. Performance Share Plan is directed to the members
of the Corporate Management Committee, excluding the
CEO. Restricted Share Plan is directed to selected key
employees, excluding the CEO and other members of the
Corporate Management Committee. New long-term share-
based incentive plans will replace Performance Share Plan
2020–2022 and Restricted Share Plan 2020–2022, of
which last shares were allocated in 2022 (reward payments
will take place in 2023–2025).
The main terms of the long-term share-based incentive
plans are explained in the Note 1.6 on pages 52–54 of the
Financial Statements.
More information on the share-based incentive plans is
available on the company’s website at
citycon.com/remuneration.
Shares held by members of the board
of directors and by the company
management
The members of the Board of Directors of Citycon, the
CEO, the other Corporate Management Committee
members held a total of 280,184 company shares on 31
December 2023. These shareholdings represented 0.2%
of the company’s total shares and total voting rights.
Details of the shareholdings of the members of the
Board of Directors, the CEO and the other members of
the Corporate Management Committee are available on
the company’s website at
www.citycon.com/managers-holdings-shares.
Events after the reporting period
Citycon has received in February an approval from
Swedish authorities on Kista transaction and is now
in final stages to take over the remaining interest in
Kista Galleria in Stockholm, Sweden. Kista Galleria has
approximately SEK 2,400 million of debt and following
the transaction Citycon assumes seller’s share of
existing debt (approximately SEK 1,200 million) and
make a cash payment (EUR approx. 2.5 million). The new
loan will be secured by additional two assets located in
Sweden.
After the transaction, Citycon will have 100% ownership
of the centre. The transaction is expected to be
executed in Q1/2024.
Helsinki, 15 February 2024
Board of Directors
20
Financial statementsFinancial review Financial Review 2023
EPRA performance measures
EPRA (European Public Real Estate Association) is a
common interest group for listed real estate companies
in Europe. Citycon is an active member of EPRA.
EPRA’s objective is to encourage greater investment
in European listed real estate companies and strive
for ‘best practices’ in accounting, financial reporting
and corporate governance in order to provide high-
quality information to investors and to increase the
comparability of different companies. The best practices
also create a framework for discussion and decision-
making on the issues that determine the future of the
sector. In addition, EPRA publishes the FTSE EPRA/
NAREIT index in association with FTSE, which tracks
the performance of the largest European and North-
American listed real estate companies. Citycon is
included in the FTSE EPRA index, which increases
international interest towards Citycon as an investment.
Citycon applies the best practices policy
recommendations of EPRA for financial reporting and
also for sustainability reporting. This section in Citycon’s
financial statements presents the EPRA performance
measures and their calculations. For more information
about EPRA and EPRA’s best practice policies please
visit EPRA’s web page: www.epra.com.
EPRA performance measures
Note 2023 2022 2021 2020 2019
EPRA Earnings, MEUR 1 109.6 122.6 124.4 136.6 145.6
Adjusted EPRA Earnings, MEUR
1
1 80.6 92.1 100.0 120.3 143.9
EPRA Earnings per share (basic), EUR 1 0.651 0.730 0.703 0.767 0.818
Adjusted EPRA Earnings per share (basic), EUR
1
1 0.479 0.548 0.565 0.676 0.809
EPRA NRV per share, EUR 2 9.30 11.01 12.15 11.48 12.45
EPRA NAV per share, EUR 2 - - - 11.30 12.28
EPRA Cost Ratio (including direct vacancy costs), % 3 19.3 16.8 18.1 18.3 14.1
EPRA Cost Ratio (excluding direct vacancy costs), % 3 17.2 14.5 14.9 15.6 11.7
EPRA Net Initial Yield (NIY), % 4 5.3 5.3 5.2 5.4 5.3
EPRA 'topped-up' NIY, % 4 5.3 5.3 5.2 5.4 5.4
EPRA vacancy rate, % 5 5.1 5.5 6.6 6.1 4.5
EPRA Property related capex MEUR 6 95.2 175.7 193.7 341.3 107.8
EPRA LTV % 7 61.6 57.4 - - -
EPRA Earnings for five years, MEUR 8 109.6 122.6 124.4 136.6 145.6
1
The adjusted key figure includes hybrid bond coupons and amortized fees.
The numbers include the sale of four investments properties during 2022.
2019 2020 2021 2022 2023
EPRA NRV per share
EUR
12.45
11.48
12.15
11.01
9.30
2019 2020 2021 2022 2023
Development of EPRA Cost Ratio during
2019–2023
%
14.1
18.3
18.1
16.8
19.3
21
Financial statementsFinancial review Financial Review 2023
1. EPRA earnings and EPRA earnings per share (basic)
EPRA Earnings presents the underlying operating performance of a real estate company excluding all so called non-
recurring items such as net fair value gains/losses on investment properties, profit/loss on disposals and other non-
recurring items. EPRA Earnings is especially important for investors who want to assess the extent to which dividends
are supported by recurring income.
2023 2022
MEUR
Average
number
of shares
(1,000)
per share,
EUR MEUR
Average
number
of shares
(1,000)
per share,
EUR
Earnings in IFRS Consolidated Income Statement -115�0 168,285 -0�683 5�1 168,011 0�030
+/- Net fair value losses/gains on investment
property 200.3 168,285 1.190 56.5 168,011 0.337
-/+ Net gains/losses on disposal of investment
property 2.3 168,285 0.014 4.3 168,011 0.025
+/- Indirect other operating expenses 0.3 168,285 0.002 26.7 168,011 -
+ Early close-out costs of debt and financial
instruments -2.9 168,285 -0.017 -8.1 168,011 -0.048
-/+ Fair value gains/losses of financial instruments 2.8 168,285 0.017 9.2 168,011 0.055
+/- Indirect losses/gains of joint ventures and
associated companies 32.0 168,285 0.190 21.0 168,011 0.125
-/+ Change in deferred taxes arising from the items
above -10.2 168,285 -0.060 8.0 168,011 0.048
+/- Non-controlling interest arising from the items
above - 168,285 - 0.0 168,011 -
EPRA Earnings (basic) 109�6 168,285 0�651 122�6 168,011 0�730
-/+ Hybrid bond coupons and amortized fees -28.9 168,285 -0.172 -30.5 168,011 -0.182
Adjusted EPRA Earnings (basic) 80�6 168,285 0�479 92�1 168,011 0�548
EPRA Earnings can also be calculated from the statement of comprehensive income from top to bottom. The EPRA
Earnings calculation is presented in the below table with this different method, which also presents the Direct
Operating profit.
2023 2022
MEUR
Average
number
of shares
(1,000)
per share,
EUR MEUR
Average
number
of shares
(1,000)
per share,
EUR
Net rental income (NRI) 195�7 168,285 1�163 203�6 168,011 1�212
Direct administrative expenses -31.1 168,285 -0.185 -28.7 168,011 -0.171
Direct other operating income and expenses 0.3 168,285 0.002 0.2 168,011 0.001
Direct Operating profit 164�8 168,285 0�980 175�2 168,011 1�043
Direct net financial income and expenses -47.7 168,285 -0.284 -47.0 168,011 -0.280
Direct share of profit/loss of joint ventures and
associated companies -4.7 168,285 -0.028 -3.6 168,011 -0.022
Direct current taxes -2.9 168,285 -0.017 -2.1 168,011 -0.013
Change in direct deferred taxes 0.1 168,285 0.001 0.2 168,011 0.001
Direct non-controlling interest - 168,285 - 0.0 168,011 0.000
EPRA Earnings (basic) 109�6 168,285 0�651 122�6 168,011 0�730
Hybrid bond coupons and amortized fees -28.9 168,285 -0.172 -30.5 168,011 -0.182
Adjusted EPRA Earnings (basic) 80�6 168,285 0�479 92�1 168,011 0�548
EPRA Earnings was EUR 109�6 million and EPRA EPS was EUR 0�651�
EPRA earnings calculated with actual FX-rates decreased due to disposals made during 2022 and weakening of
NOK and SEK FX-rates. Standing portfolio EPRA Earnings with comparable FX-rates increased by 3.1%.
2022 1 2 3 4 5 6 7 8 2023
Change in EPRA earnings
MEUR
0,0
-2,4
-0,8
-1,1
-28,9
-8,0
-0,8
109,6
80,6
122.6
1 Net rental income
2 Direct net financial income and expenses
3 Direct administrative expenses
4 Direct other operating income and expenses
5 Direct current and deferred taxes
6 Other direct items
7 EPRA Earnings 2023
8 Hybrid bond coupons and amortized fees
22
Financial statementsFinancial review Financial Review 2023
2. EPRA net asset value metrics
EPRA NAV metrics present the fair value of net assets
of a real estate company. In October 2019, the European
Public Real Estate Association (‘EPRA’) published new
Best Practice Recommendations (‘BPR’) for financial
disclosures by listed real estate companies. The BPR
introduced three new measures of net asset value:
EPRA Net Reinstatement Value (NRV), Net Tangible
Assets (NTA), and Net Disposal Value (NDV), which
replaced previously reported measures EPRA NAV and
NNNAV. The metrics have been updated to better reflect
the development of real estate companies from passive
asset owners to active asset managers and capital
allocators and hence presents three different scenarios
from which the company can choose one as the most
representative.
The EPRA NRV scenario, aims to represent the value
required to rebuild the entity and assumes that no selling
of assets takes place. EPRA NRV intends to reflect the
fair value of a business on a going-concern basis, all
items arising from future disposals (e.g. deferred taxes
on disposals), the fair value of financial instruments
are excluded from EPRA NRV. The transfer tax cost to
rebuild the portfolio increases EPRA NRV.
The EPRA NTA is focused on reflecting a company’s
tangible assets and assumes that entities buy and
sell assets, thereby crystallising certain levels of
unavoidable deferred tax liability.
EPRA NDV aims to represent the shareholders’ value
under an orderly sale of business, where deferred tax,
financial instruments and certain other adjustments are
calculated to the full extent of their liability, net of any
resulting tax. EPRA NDV is a measure of the real estate
company’s “spot” fair value at the balance sheet date.
Spot fair value means that EPRA NDV reflects the fair
value of net assets of the company at a particular day
as opposed to EPRA NRV, which reflects the fair value
of net assets on a going-concern basis. However, EPRA
NDV is not a liquidation NAV as the fair values of assets
and liabilities are not based on a liquidation scenario.
Citycon considers EPRA NRV to be the most relevant
measure for its business. EPRA NRV is closest to
previously reported EPRA NAV. EPRA NRV will now be
Citycon’s primary measure of net asset value, replacing
the previously reported EPRA NAV and EPRA NAV per
share measures.
Closing share price of Citycon was 5.20 EUR per share
on 31 December 2023.
The tables below present calculation of the three new
EPRA net asset value measures NRV, NTA and NDV.
EPRA NRV per share decreased by EUR 1�71
to EUR 9�30 (11�01) mainly due to weaker NOK
and SEK currency rates that lowered equity
through translation losses� The impact of
weaker currency rates was EUR 0�47 per share�
EPRA Net Asset Value measures
31 December 2023 EPRA NRV EPRA NTA EPRA NDV
Equity attributable to parent company shareholders 1,380.1 1,380.1 1,380.1
Deferred taxes from the difference of fair value and fiscal value of investment properties
3
246.3 123.1 -
Fair value of financial instruments 1.4 1.4 -
Goodwill as a result of deferred taxes -61.5 - -
Goodwill as per the consolidated balance sheet - -111.4 -111.4
Intangible assets as per the consolidated balance sheet - -10.7 -
The difference between the secondary market price and carrying value of bonds
1
- - 153.0
Real estate transfer taxes
2
33.8 - -
TOTAL 1,600�1 1,382�7 1,421�8
Number of ordinary shares at balance sheet date, million 172.0 172.0 172.0
Net Asset Value per share 9�30 8�04 8�27
31 December 2022
Equity attributable to parent company shareholders 1,618.8 1,618.8 1,618.8
Deferred taxes from the difference of fair value and fiscal value of investment properties
3
264.9 132.5 -
Fair value of financial instruments -1.9 -1.9 -
Goodwill as a result of deferred taxes -65.7 - -
Goodwill as per the consolidated balance sheet - -115.4 -115.4
Intangible assets as per the consolidated balance sheet - -11.0 -
The difference between the secondary market price and carrying value of bonds
1
- - 246.5
Real estate transfer taxes
2
34.2 - -
TOTAL 1,850�3 1,622�8 1,749�9
Number of ordinary shares at balance sheet date, million 168.0 168.0 168.0
Net Asset Value per share 11�01 9�66 10�42
1
When calculating the EPRA NDV in accordance with EPRA’s recommendations, the shareholders’ equity is adjusted using EPRA’s guidelines so that bonds
are valued based on secondary market prices. The difference between the secondary market price and the carrying value of the bonds was EUR 153.0 million
(secondary market price lower) as of 31 December 2023. In the comparison period 31 December 2022, the difference was EUR 246.5 million (secondary market
price lower).
2
The real estate transfer tax adjustment in EPRA NRV calculation is based on the transfer tax cost for the buyer for share deal in Finland. Share deals are not
subject to transfer tax in other group operating countries.
3
In the EPRA NTA formula, 50% of the deferred tax liability related to investment property fair value is added back, according to EPRA guidelines.
23
Financial statementsFinancial review Financial Review 2023
MEUR 2023 2022
Include:
Administrative expenses
1
31.1 28.7
Property operating expenses and other expenses from leasing operations less service charge
costs 68.0 70.3
Net service charge costs/fees 14.4 14.1
Management fees less actual/estimated profit element -0.2 0.0
Other operating income/recharges intended to cover costs less any related profit -7.5 -8.3
Share of joint venture expenses 2.3 2.6
Exclude:
Ground rent costs -6.1 -6.9
Service charge costs recovered through rents but not separately invoiced -57.3 -59.9
Share of joint venture investment property depreciation, ground rent costs and service charge
costs recovered through rents but not separately invoiced -2.6 -2.8
EPRA Costs (including direct vacancy costs) (A) 42�3 37�8
Direct vacancy costs -4.7 -5.2
EPRA Costs (excluding direct vacancy costs) (B) 37�5 32�5
Gross rental income less ground rent costs 209.2 215.4
Add: share of joint ventures (Gross rental income less ground rent costs less service fees in GRI) 9.3 9.4
Gross Rental Income (C) 218�5 224�8
EPRA Cost Ratio (including direct vacancy costs) (A/C, %) 19�3 16�8
EPRA Cost Ratio (excluding direct vacancy costs) (B/C, %) 17�2 14�5
1
Administrative expenses are net of costs capitalised of EUR 4.6 million in 2023 and EUR 4.7 million in 2022. Citycon’s policy is to capitalise, for example,
expenses related to property development projects and major software development projects.
EPRA Cost Ratio increased to 19�3% (16�8%)
EPRA Cost Ratio (including direct vacancy costs) increased to 19.3% (16.8%) and EPRA Cost Ratio (excluding
direct vacancy costs) increased to 17.2% (14.5%) from previous year.
2022 1 2 3 4 5 2023
Change of net reinstatement value (EPRA NRV)
EUR
EPRA
NRV
EPRA
NRV
1 EPRA Earnings
2 Indirect result
3 Translation reserve
4 Dividends paid and equity return
5 Other
-0.49
-0.30
-1.35
0.65
-0.22
9.30
11.01
3. EPRA cost ratios
EPRA Cost Ratios reflect the relevant overhead
and operating costs of the business and provide a
recognized and understood reference point for analysis
of a company’s costs. The EPRA Cost Ratio (including
direct vacancy costs) includes all administrative and
operating expenses in the IFRS statements including
the share of joint ventures’ overheads and operating
expenses (net of any service fees). The EPRA Cost Ratio
(excluding direct vacancy costs) is calculated as above,
but with an adjustment to exclude vacancy costs. Both
EPRA Cost Ratios are calculated as a percentage of
Gross Rental Income less ground rent costs, including a
share of joint venture Gross Rental Income less ground
rent costs.
24
Financial statementsFinancial review Financial Review 2023
4. EPRA net initial yield (NIY), % and EPRA ‘topped-up’ NIY, %
EPRA initial yields present property portfolio’s ability to generate rent.
EPRA NIY, % is calculated by dividing the net rental income for the completed property portfolio, based on the valid
lease portfolio on the balance sheet date, by the gross market value of the completed property portfolio. EPRA initial
yields calculation does not include Kista Galleria.
In EPRA ‘topped-up’ NIY, the net rental income is ‘topped-up’ to reflect rent after the expiry of lease incentives such as
rent free periods and rental discounts.
MEUR 31 December 2023 31 December 2022
Fair value of investment properties determined by the external appraiser 3,779.3 3,962.6
Less (re)development properties, unused building rights and properties which valuation is
based on the value of the building right -83.5 -169.2
Completed property portfolio 3,695�7 3,793�4
Plus the estimated purchasers' transaction costs 62.1 70.8
Gross value of completed property portfolio (A) 3,757�8 3,864�2
Annualised gross rents for completed property portfolio 272.1 270.4
Property portfolio's operating expenses -73.4 -66.4
Annualised net rents (B) 198�7 203�9
Plus the notional rent expiration of rent free periods or other lease incentives 0.8 1.1
Topped-up annualised net rents (C) 199�5 205�0
EPRA Net Initial Yield (NIY), % (B/A) 5�3 5�3
EPRA 'topped-up' NIY, % (C/A) 5�3 5�3
EPRA NIY and EPRA ‘TOPPED-UP’ stable
EPRA initial yields were stable during the year mainly due to negative fair value development and changes in net
rental income.
5. EPRA vacancy rate, %
The EPRA vacancy rate presents how much out of the full potential rental income is not received because of vacancy.
The EPRA vacancy rate is calculated by dividing the estimated rental value of vacant premises by the estimated rental
value of the whole property portfolio if all premises were fully leased. The EPRA vacancy rate is calculated using the
same principles as the economic occupancy rate, which Citycon also discloses.
MEUR 31 December 2023 31 December 2022
Annualised potential rental value of vacant premises 13.6 14.3
÷ Annualised potential rental value for the whole property portfolio 264.7 259.0
EPRA vacancy rate, % 5�1 5�5
EPRA vacancy rate decreased from last years’ level
The EPRA vacancy rate at the end of 2023 for the entire property portfolio was 5.1%. Vacancy decreased in all
operating countries reflecting the fast recovery of the portfolio.
6. Property related capex
2023 2022
Group
(excl� Joint
ventures)
Joint ventures
(proportionate
share) Total
Group
(excl� Joint
ventures)
Joint ventures
(proportionate
share) Total
Acquisitions - - 6.3 6.3
(Re)development 50.0 2.4 52.4 124.7 3.7 128.4
Investment properties
No incremental lettable space 15.3 15.3 16.7 16.7
Tenant incentives 27.0 27.0 20.1 20.1
Capitalised interest 0.5 0.5 4.3 4.3
Total capital expenditure
1
92�8 2�4 95�2 172�0 3�7 175�7
Conversion from accrual to cash basis 1.5 0.3 1.9 3.4 0.2 3.6
Total capital expenditure on cash basis
1
94�4 2�7 97�1 175�4 3�9 179�3
1
Includes only property related capex.
Capex disclosed in the table are categorised according to the new EPRA recommendations issued in October 2019.
The comparison period figures have also been presented accordingly. Investments include both income-producing and
maintenance capex.
25
Financial statementsFinancial review Financial Review 2023
7. EPRA LTV
31 December 2023
MEUR
Citycon group as
reported MEUR
Share of Joint
Ventures MEUR
Share of Material
Associates MEUR
Non-controlling
Interests MEUR
Combined
MEUR
Include
Borrowings from Financial Institutions 336.5 108.0 - - 444.5
Commercial paper 46.5 - - - 46.5
Hybrids 607.3 - - - 607.3
Bond loans 1,442.6 - - - 1,442.6
Foreign currency derivatives -10.9 - - - -10.9
Net payables 28.9 7.2 - - 36.1
Exclude
Cash and cash equivalents 25.2 3.7 - - 29.0
Net Debt (a) 2,425�8 111�5 - - 2,537�2
Owner-occupied property 2.4 - - - 2.4
Investment properties at fair value 3,817.7 172.9 - - 3,990.5
Properties held for sale - - - - 0.0
Intangibles 10.7 - - - 10.7
Financial assets 116.0 - - - 116.0
Total Property Value (b) 3,946�7 172�9 - - 4,119�6
LTV (a/b) 61�5% 64�5% 61�6%
31 December 2022
MEUR
Citycon group as
reported MEUR
Share of Joint
Ventures MEUR
Share of Material
Associates MEUR
Non-controlling
Interests MEUR
Combined
MEUR
Include
Borrowings from Financial Institutions - 109.2 - - 109.2
Commercial paper 49.2 - - - 49.2
Hybrids 691.5 - - - 691.5
Bond loans 1,715.7 - - - 1,715.7
Foreign currency derivatives -19.0 - - - -19.0
Net payables 9.3 4.3 - - 13.7
Exclude - -
Cash and cash equivalents 69.2 3.3 - - 72.5
Net Debt (a) 2,377�6 110�3 - - 2,487�8
Owner-occupied property 1.6 - - - 1.6
Investment properties at fair value 3,994.8 210.7 - - 4,205.5
Properties held for sale - - - - 0.0
Intangibles 11.0 - - - 11.0
Financial assets 115.7 - - - 115.7
Total Property Value (b) 4,123�2 210�7 - - 4,333�8
LTV (a/b) 57�7% 52�3% 57�4%
Most significant difference between EPRA LTV and IFRS LTV is the classification of hybrid bonds. In EPRA LTV hybrid
bonds are presented as 100% debt whereas in IFRS LTV hybrid bonds are presented as 100% equity. Credit agencies
classify hybrid bonds as 50% debt and 50% equity.
In addition, EPRA LTV includes company’s share of joint venture’s selected assets and liabilities where as IFRS LTV
excludes them.
26
Financial statementsFinancial review Financial Review 2023
8. EPRA earnings for five years
MEUR 2023 2022 2021 2020 2019
Earnings in IFRS Consolidated Income Statement -115�0 5�1 121�0 -28�0 8�9
+/- Net fair value losses/gains on investment property 200.3 56.5 -48.6 146.9 121.9
-/+ Net gains/losses on disposal of investment property 2.3 4.3 6.5 -0.7 -1.5
-/+ Indirect other operating expenses 0.3 26.7 0.4 - 0.0
-/+ Fair value gains/losses of financial instruments and early close-out
costs of debt and financial instruments -0.1 1.0 8.2 5.8 5.3
+/- Indirect losses/gains of joint ventures and associated companies 32.0 21.0 2.3 27.2 19.5
-/+ Change in deferred taxes arising from the items above -10.2 8.0 34.6 -14.7 -8.5
+/- Non-controlling interest arising from the items above - 0.0 - - -
EPRA Earnings (basic) 109�6 122�6 124�4 136�6 145�6
-/+ Hybrid bond coupons and amortized fees -28.9 -30.5 -24.3 -16.2 -1.7
Adjusted EPRA Earnings (basic) 80�6 92�1 100�0 120�3 143�9
Issue-adjusted average number of shares, million 168,285 168,011 177,033 177,998 177,997
EPRA Earnings per share (basic), EUR 0�651 0�730 0�703 0�767 0�818
Adjusted EPRA Earnings per share (basic), EUR 0�479 0�548 0�565 0�676 0�809
EPRA Earnings can also be calculated from the consolidated income statement from top to bottom. The EPRA
Earnings calculation is presented in the below table with this different method, which also presents the Direct
Operating profit.
MEUR 2023 2022 2021 2020 2019
Net rental income 195�7 203�6 202�3 205�4 217�4
Direct administrative expenses -31.1 -28.7 -26.1 -25.9 -26.8
Direct other operating income and expenses 0.3 0.2 0.0 0.9 2.8
Direct operating profit 164�8 175�2 176�1 180�4 193�5
Direct net financial income and expenses -47.7 -47.0 -46.8 -46.0 -48.9
Direct share of profit/loss of joint ventures and associated companies -4.7 -3.6 -4.0 -0.8 2.8
Direct current taxes -2.9 -2.1 -3.3 -1.8 -2.0
Change in direct deferred taxes 0.1 0.2 2.4 4.8 0.1
Direct non-controlling interest - 0.0 0.0 -0.1 0.0
EPRA Earnings 109�6 122�6 124�4 136�6 145�6
Hybrid bond coupons and amortized fees -28.9 -30.5 -24.3 -16.2 -1.7
Adjusted EPRA Earnings 80�6 92�1 100�0 120�3 143�9
Issue-adjusted average number of shares, million 168,285 168,011 177,033 177,998 177,997
EPRA Earnings per share (basic), EUR 0�651 0�730 0�703 0�767 0�818
Adjusted EPRA Earnings per share (basic), EUR 0�479 0�548 0�565 0�676 0�809
27
Financial statementsFinancial review Financial Review 2023
Operational key figures
Shopping Centres
1
Location GLA, sq�m� Retail GLA, sq�m�
Economic
occupancy rate, %
31 December 2023 Year of acquisition
Year built/latest
year of renovation
Finland
Shopping centres, Helsinki area
Heikintori Espoo 9,200 7,000 - 1998–2021 1968
Isomyyri Vantaa 11,700 8,400 - 1999 1987
Iso Omena Espoo 102,100 84,800 96.9 2007, 2014 2001/2016, 2017
Lippulaiva Espoo 56,800 37,900 92.4 2022–2023 2022–2023
Myyrmanni Vantaa 43,600 33,900 97.1 1999, 2006 1994/2016
Shopping centres, other areas in Finland
IsoKarhu Pori 15,000 12,700 71.2 1999 1972/2014
IsoKristiina Lappeenranta 16,950 12,700 96.5 1999, 2005 1987, 1993/2015
Koskikeskus Tampere 35,300 30,200 96.1 1999, 2003 1988/2012
Trio Lahti 46,200 27,500 88.3 1999, 2007 1977, 1992/2010
Shopping centres, total - 336,850 255,100 95�0 - -
Other properties, total - 2,240 800 - - -
Finland, total - 339,090 255,900 95�0 - -
Norway
Shopping centres, Oslo area
Kolbotn Torg Kolbotn 18,800 16,500 99.7 2015 2008
Liertoppen Kjøpesenter Lierskogen 27,000 24,800 97.6 2015 1987/1990
Linderud Senter Oslo 21,200 16,400 98.6 2015 1967/2009
Stovner Senter Oslo 42,600 31,700 91.3 2020 1975/2016
Trekanten Asker 24,000 16,900 98.0 2015 1997/2008
28
Financial statementsFinancial review Financial Review 2023
Location GLA, sq�m� Retail GLA, sq�m�
Economic
occupancy rate, %
31 December 2023 Year of acquisition
Year built/latest
year of renovation
Shopping centres, other areas in Norway
Herkules Skien 50,100 44,300 98.2 2015 1969/2013
Kilden Kjøpesenter Stavanger 23,400 19,400 96.6 2015 1989/2015
Kongssenteret Kongsvinger 18,000 14,900 90.6 2015 2001/2016
Kremmertorget Elverum 20,300 17,100 85.6 2015 1979/2012
Oasen Kjøpesenter Fyllingsdalen 50,100 26,700 96.4 2015 1971/2014
Solsiden
2
Trondheim 14,500 13,700 99.5 2015 2000
Stopp Tune Sarpsborg 13,400 12,600 99.5 2015 1993
Storbyen Sarpsborg 25,500 23,500 80.7 2015 1999/2015
Torvbyen Fredrikstad 8,200 7,000 - 2020 1988/2012
Norway, total - 357,100 285,500 95�2 - -
Sweden
Shopping centres, Stockholm area
Jakobsbergs Centrum Järfalla 42,500 26,000 85.5 2006 1959/1993
Kista Galleria, 50% Stockholm 46,250 29,100 88.1 2013 1977,2002/ 2014
Liljeholmstorget Galleria Stockholm 41,200 27,100 97.0 2006 1973/2009
Åkersberga Centrum Åkersberga 27,600 22,600 88.3 2005, 2015 1985/2011
Shopping centres, Gothenburg area
Stenungstorg Centrum Stenungsund 35,800 22,200 89.2 2006 1967/2016
Mölndals Galleria Mölndal 26,300 24,200 94.3 2014/2018 2018
Shopping centres, total - 219,650 151,200 91�4 - -
Other properties, total - - - - - -
Sweden, total - 219,650 151,200 91�4 - -
Denmark
Albertslund Centrum Copenhagen 19,600 14,100 96.0 2012 1965/2015
Strædet Køge 19,100 17,300 98.8 2017, 2018 2017, 2018
Shopping centres, Estonia
Kristiine Keskus Tallinn 45,300 43,900 99.8 2011 1999/2019
Rocca al Mare Tallinn 57,900 56,700 94.9 2005 1998/2009
Denmark & Estonia, total - 141,900 132,000 97�2 - -
Total - 1,057,740 824,600 94�6 - -
1
Including Kista Galleria 50%.
2
Rented property.
29
Financial statementsFinancial review Financial Review 2023
Fair value
No� of properties Fair value, EUR million
Fair value change,
EUR million Average yield requirement, %
Average market rent,
EUR/sq�m�/month
31 December 2023 31 December 2023 31 December 2022 2023 31 December 2023 31 December 2022 31 December 2023
Shopping centres, Finland 9 1,683.9 1,706.5 -69.1 - - -
Other properties, Finland 1 4.4 3.8 0.6 - - -
Finland, total 10 1,688�3 1,710�2 -68�4 5�5 5�1 28�1
Shopping centres, Norway 13 1,077.1 1,198.1 -64.5 - - -
Rented shopping centres, Norway
1
1 - - - - - -
Norway, total 14 1,077�1 1,198�1 -64�5 6�2 5�7 20�6
Shopping centres, Sweden 5 610.8 630.8 -35.3 - - -
Other properties, Sweden 1 6.7 6.2 - - - -
Sweden, total 6 617�5 637�0 -35�3 5�8 5�5 25�1
Shopping centres, Denmark & Estonia 4 434.8 449.5 -25.5 - - -
Other properties, Denmark & Estonia - - - - - - -
Denmark & Estonia, total 4 434�8 449�5 -25�5 7�2 6�8 22�7
Shopping centres, total 32 3,806.6 3,984.8 -194.3 - - -
Other properties, total 2 11.1 10.0 0.6 - - -
Investment properties, total 34 3,817�7 3,994�8 -193�7 6�0 5�5 24�2
Right-of-use assets classified as investment properties (IFRS 16) - 40.5 45.3 -6.6 - - -
Investment properties in the statement of financial position, total 34 3,858�2 4,040�1 -200�3 6�0 5�5 24�2
Kista Galleria, 50% 1 173.2 210.7 -40.8 - - -
Investment properties in the statement of financial position and Kista Galleria (50%), total 35 4,031�4 4,250�8 -241�1 5�9 5�5 24�3
1
Value of rented properties is recognised within IFRS 16 investment properties based on IFRS rules.
30
Financial statementsFinancial review Financial Review 2023
Like-for-like portfolio
No� of properties Fair value, EUR million
Fair value change,
EUR million Average yield requirement, %
Average market rent,
EUR/sq�m�/month
31 December 2023 31 December 2023 31 December 2022 2023 31 December 2023 31 December 2022 31 December 2023
Shopping centres, Finland 4 1,073.9 1,064.6 -0.8 - - -
Other properties, Finland - - - - - - -
Finland, total 4 1,073�9 1,064�6 -0�8 5�6 5�1 29�3
Shopping centres, Norway 11 925.8 1,012.4 -34.2 - - -
Rented shopping centres, Norway
1
1 - - - - - -
Norway, total 12 925�8 1,012�4 -34�2 6�3 5�8 20�1
Shopping centres, Sweden 3 461.4 473.9 -18.4 - - -
Other properties, Sweden - - - - - - -
Sweden, total 3 461�4 473�9 -18�4 5�5 5�2 31�0
Shopping centres, Denmark & Estonia 4 434.8 449.5 -25.5 - - -
Other properties, Denmark & Estonia - - - - - - -
Denmark & Estonia, total 4 434�8 449�5 -25�5 7�2 6�8 22�7
Shopping centres, total 23 2,461.1 2,551.0 -53.4 - - -
Other properties, total - - - - - - -
Like-for-like properties, total 23 2,895�9 3,000�5 -78�9 6�1 5�6 24�4
Right-of-use assets classified as like-for-like properties (IFRS 16) - 37.3 41.3 -5.5 - - -
Like-for-like properties in the statement of financial position, total 23 2,933�2 3,041�8 -84�4 6�1 5�6 24�4
1
Value of rented properties is recognised within IFRS 16 investment properties based on IFRS rules.
Citycon’s five largest properties
1
Average rent,
EUR/sq�m�/
month
Gross rental
income,
EUR million
Net rental
income,
EUR million
Fair
value,
EUR million
Fair value
change,
EUR million
31 December
2023 2023 2023
31 December
2023 2023
Iso Omena 37.8 37.1 36.2 805.6 17.6
Lippulaiva 28.2 13.7 12.5 369.2 -63.4
Liljeholmstorget Galleria 35.2 15.1 13.7 311.4 -14.0
Myyrmanni 26.8 9.3 9.0 212.0 0.6
Oasen Senter 23.7 11.1 10.2 190.5 -6.2
Five largest properties, total 31�6 86�4 81�5 1,888�8 -65�5
1
Excluding Kista Galleria.
31
Financial statementsFinancial review Financial Review 2023
Rental income by business units
Gross rental income, EUR million Net rental income, EUR million
2023 2022 2023 2022
Finland 81.6 74.2 76.4 68.6
Norway 67.7 83.0 62.5 78.9
Sweden 33.8 35.8 27.8 30.4
Denmark & Estonia 32.2 29.3 29.3 26.0
Other - - -0.4 -0.3
Investment properties, total 215�3 222�3 195�7 203�6
Kista Galleria, 50% 9.3 9.4 6.6 6.8
Investment properties and Kista Galleria (50%),
total 224�6 231�7 202�2 210�5
Average rent
Average remaining
length of lease
agreements, years
Average remaining
length of lease
agreements, years
Average rent,
EUR/sq�m�/month
Average rent,
EUR/sq�m�/month
31 December 2023 31 December 2022 31 December 2023 31 December 2022
Finland 4.5 4.4 27.9 26.3
Norway 2.9 2.7 20.9 21.9
Sweden 2.7 2.7 23.9 23.1
Denmark & Estonia 3.4 3.2 23.1 23.0
Total 3�6 3�4 24�0 23�7
Top ten tenants
Proportion of rental income based on valid rent roll at 31 December 2023, %
S Group 6.3%
Kesko Group 5.2%
Varner Group 2.7%
NorgesGruppen 2.2%
ICA Group 1.8%
Coop 1.6%
Clas Ohlson 1.5%
Stockmann Group 1.5%
H&M 1.4%
Tryg Forsikring 1.3%
Total 25�5%
Leasing activity, investment properties
Number of lease
agreements Leased area, sq�m�
Average rent, EUR/
sq�m�/month
31 December 2022 3,191 902,042 23�7
Leases started 1,200 236,923 24.0
Leases ended 1,018 237,608 23.5
Acquisitions - - -
Other changes -2 1,438 -
31 December 2023 3,371 902,795 24�0
Rental Income by Category, %
Finland Norway Sweden
Denmark
& Estonia Total
Groceries 27.1 12.1 16.2 18.1 19.4
Fashion and Accessories 15.0 21.8 19.5 25.1 19.3
Home and Sporting Goods 10.7 25.5 13.3 24.4 17.7
Services and Offices 16.3 15.9 18.4 8.3 15.4
Cafes and Restaurants 11.8 8.5 10.2 9.0 10.1
Cosmetics and Pharmacies 6.5 10.2 11.5 8.5 8.7
Wellness 3.2 4.8 8.6 2.8 4.5
Specialty Stores 3.2 1.1 1.1 2.1 2.0
Residentials and Hotels 4.5 0.0 1.3 - 1.9
Leisure 1.7 0.1 0.0 1.6 0.9
Total 100�0 100�0 100�0 100�0 100�0
32
Financial statementsFinancial review Financial Review 2023
(Re)development projects in progress
On 31 December 2023
Location Area before/after, sq�m�
Expected gross investment,
MEUR
Actual gross investment by
31 December 2023, MEUR Completion
Herkules, residentials (50%) Skien, Norway -/7,600 28.0 10.5 2024
Barkarby, residentials Stockholm, Sweden -/12,950 69.5
1
6.6
1
2024
1
The transaction has been structured as a forward commitment, whereby Citycon made a deposit of EUR 6.6 million in April 2022 and will fund the remaining purchase price, pro-rata, at the completion of two construction phases in Q1/2024 and
Q2/2024. The closing of the transaction will be after the completion of each phase with no additional obligations from Citycon before construction of each phase is complete.
Completed (re)development projects on Q1–Q4/2023
Location Area before/after, sq�m�
Actual gross investment by
31 December 2023, MEUR Completion
Lippulaiva residentials Helsinki metropolitan area, Finland -/12,800 61.3 Q1/2023
Potential (re)development projects (non committed)
Area before/after, sq�m�
Liljeholmstorget Galleria Stockholm, Sweden 40,500/90,000 Extension possibility of the shopping centre to meet the strong demand for more retail, office/
healthcare and services including culture and library, entertainment and food, all directly connected
to the metro station and bus terminal. Plans also include creating building rights for residentials.
Stenungstorg Steungssund, Sweden 30,400/30,900 The plan is to tranform the current shopping centre area into a modern city center and to create a
urban hub with a mix of residential areas, hotel, retail and services.
Trekanten Oslo, Norway 23,800/45,000 Extension possibility of the shopping centre with the main objective to increase the offering of shops
and services as well as create more visible and inviting entrances and improved circulation. Plans
also include adding residential, offices, healthcare and sports facilities on top of the centre.
Oasen Kjøpesenter (phase II) Bergen, Norway 56,800/68,800 A residential development project which includes opportunity to build several residential towers in
connection with the existing shopping centre.
Isomyyri Vantaa, Finland 11,650/27,800 Aim to develop a retail centre on an urban city block. The project includes new residential buildings
and demolishing the present building. Retail, commercial premises and services are planned to be
located on the street level of the new residentials. Includes also potential for offices.
33
Financial statementsFinancial review Financial Review 2023
Risk and risk management
The objective of Citycon’s risk management is to
ensure that the business targets are achieved by
identifying, assessing and monitoring key risks
which may threaten these targets, and to the extent
possible, avoid, transfer or mitigate these risks.
Risk management principles
Citycon is exposed to various risks through the normal
course of its activities. No business can be conducted
without accepting a certain risk level, and expected
gains are to be assessed against the involved risks.
Successful risk management implemented in the
business processes decreases the likelihood of risk
realization and mitigates the negative effects of
realised risk. Many of the risks and threats have not
only potential negative effects, but could also develop
in a favourable manner, or if effective proactive
measures are taken, be turned into opportunities for
Citycon.
The Board of Directors determines Citycon’s strategic
direction and is jointly with the Management
Committee responsible for the long term and overall
management of strategic risks. The operational risks,
financial risks and hazard risks are managed in the
various functions as a part of operational management.
Each function has a dedicated person who is the owner
of the risks in that area and also responsible for the
reporting of the risks, the mitigation plans and the
follow-up on their implementation.
Risk reporting
The risk management and reporting process involves
identifying, assessing, quantifying, mitigating and
monitoring risks in all main business operations and
processes. The process also includes evaluation of
existing, and the planning of new, risk mitigation plans
for the identified risks in order to continuously improve
risk management processes.
The risk reporting process gathers data on risks and
the respective mitigation plans into one group-wide
risk register. A Risk steering committee is responsible
for the risk reporting process and evaluates which risks
to present to Citycon’s Board of Directors to facilitate
discussion and inform about the major risks in the
company. This is done during the budgeting process so
that the risks are linked to the annual targets. In order
to evaluate the importance of each risk and to improve
the comparativeness, an estimate of the loss associated
with each risk is determined together with the
probability of risk realization. The realised risks during
the previous year are also estimated and reported.
Identify
Assess &
quantify
Create
mitigation
plans
Reports risk
and mitigation
plans to the
board
Monitor
Insurances
To transfer certain operational and hazard risks, Citycon
maintains a comprehensive insurance coverage to cover
damages, claims and liabilities potentially arising from
the Group’s business. The properties are insured under
the property damage policy to their full reconstruction
value, including business interruption insurance and
third-party liability insurance. Citycon also have other
customary insurance policies.
Board of Directors
Risk Report
Risk management
as part of continuous operational management
in Management Committee
• Operations
• Leasing
• Business development
• Property transactions
• Property development
• Reporting and accounting
• Property valuations
Business operations and functions
• Tax
• Funding
• Financial risk management
• Communication and IR
• Legal
• IT
• HR
Internal auditInternal control
34
Financial statementsFinancial review Financial Review 2023
Risk and impact Risk management measures
Leasing • The economic development in Citycon’s operating countries impacts consumer confidence which could affect demand for
retail premises. This may lead to lower rental levels or increased vacancy. It could also increase the risks for credit losses or
decrease turnover based rental income.
• Continued high inflation environment and increased energy costs could affect negatively to consumer purchase power and
increase the risk of tenant bankruptcies and weaken tenant’s capability to pay rent which could increase Citycon’s vacancy and
weaken results.
• The growing online retailing that affects customer behavior, or increased local competition may affect demand for retail
premises and put pressure on rental levels or increase vacancy, especially in less urban locations.
• Citycon’s strategy to focus on grocery anchored, urban shopping centres connected to public transportation with necessity-driven
retail has proven its stability in various market conditions with steady cash flows, occupancy and low credit losses also during a
downturn. This strategy also decreases the negative effects of the increasing online retailing.
• The fact that most of the company’s assets are in AAA/AA+ rated countries decreases the risk of a major downturn affecting the
retail sector.
• Citycon is continuously following and analysing tenants to identify risk tenants, and requires a rent collateral.
• Tenant diversification has improved considerably through focused leasing efforts and through pan-Nordic strategy and the share
of risk tenants has actively been decreased.
Property
Development
& transactions
• Increased costs in development projects due to rising construction costs or delays due to unforeseeable challenges.
• Reduced demand for new retail space could result in a low occupancy rate or lower than planned rent levels in new premises.
• Planned divestments of non-core properties could be delayed due to relatively low liquidity for secondary assets
• Maintaining relatively low level of development exposure and keeping no landbank.
• Construction costs are managed through competitive tendering, careful project monitoring of costs and by entering into contracts
with price caps when appropriate.
• Leasing risks are minimised by having strict pre-leasing requirements prior to project start, by signing agreements with key anchor
tenants at an early stage and by carrying out developments in proven retail locations with strong and growing demographics.
Operations • A major accident, system failure, or terrorist incident could threaten the safety of shoppers and retailers, leading to loss of
consumer confidence and thereby loss of income and extra costs.
• Risk of increased operating cost for e.g. maintenance, energy or security. In some lease agreements the rent paid by the
lessee is not affected by changed operating expenses, and a rise in operating expenses higher than inflation would decrease
the profitability. Also, when the higher costs can be passed to tenants, rising operating expenses may reduce tenants’ rental
payment capacity.
• Governmental restrictions due to new pandemic could threaten footfall and tenants’ ability to conduct business.
• Risk of accidents and incidents mitigated by adequate security plans and incident procedures supported by crisis case exercises
for personnel.
• Comprehensive insurance coverage.
• Citycon tries to minimize the impact of rising operating expenses by lease contracts with specified rent components when possible
and charging tenants based on actual operating costs.
• Efficient centralized procurement, frame contracts with service providers and suppliers, cost monitoring and cost benchmarking
between shopping centres.
• To mitigate the risk of energy price hikes, electricity prices are fixed according to a hedging policy, and energy efficiency actions
have been implemented.
Property
values
• The value of the properties can decrease for a number of reasons: a weaker economic environment impacting consumer
purchase power, changes in -competition and consumer behaviour towards internet shopping, reduced availability and higher
cost of financing and the relative attractiveness of other asset classes. The changes may lead to higher yield requirements,
decreased market rents and increased vacancy rates.
• While many of the factors affecting property values cannot be influenced, Citycon seeks to impact the fair market value through
active shopping centre management and optimising the profitability of its centres.
• Citycon’s strategy to focus on urban mixed-use centres with necessity-driven retail and services in strong and growing locations
results in relatively stable property valuations throughout the economic cycle.
• Citycon’s presence in five highly rated countries gives country risk diversification and decreases the volatility of the total property
values.
Environment • Environmental concerns, customer expectations or legislation might restrict or impact Citycon’s business, land use and
construction.
• Risks associated with e.g. climate change might affect Citycon’s business environment. For example, extreme weather
conditions and regulation implemented to mitigate and adapt to climate change can increase energy, maintenance and
construction costs.
• Environmental impact assessments are conducted in connection with major projects.
• Ensuring the environmental compliance of our buildings through energy investments, internal management practices, green
energy purchase and production as well as external standards and certifications.
• A sustainability strategy with clear short-term and long-term goals.
People • An expert organisation of Citycon’s nature relies heavily on its personnel for success, and therefore it is crucial to attract and
retain the right people, develop competencies and ensure clear roles and targets.
• Citycon sees good leadership as essential to reduce personnel related risks and places great emphasis on target-setting and
performance management, competence development, career advancement, and commitment of key employees.
Financing • Both bank and bond financing have been available for Citycon, but willingness to lend at competitive terms could decline due to
credit rating downgrades, turmoil in financial markets, tightening regulation or other reasons, which could affect the availability
or cost of debt financing
• If interest rates continue to be at high level, it will inevitably increase Citycon’s financial expenses over time.
• Citycon has a conservative but active financing policy, with a focus on long-term financing, a solid balance sheet and keeping
70–90% of debt tied to fixed interest rates to reduce the effects of increased interest rates.
• Investment grade credit rating by Standard & Poor’s (BBB-) supports the availability and cost of financing. Several long-term bond
issues have reduced the refinancing risk and dependency on bank financing.
35
Financial statementsFinancial review Financial Review 2023
Shares and shareholders
Listing
Market place Nasdaq Helsinki
Listed since 1988
Trading currency euro
Segment Large Cap
Sector Financials
Sub-industry Real Estate Operating Companies
Trading code CTY1S
ISIN code FI4000369947
Shares and share capital
Citycon Oyj’s shares are listed on Nasdaq Helsinki.
Citycon has one series of shares and each share entitles
its holder to one vote at the General Meeting and to an
equal dividend. The shares have no nominal value.
At year-end 2023, Citycon’s total number of shares was
171,994,204. The market capitalisation of Citycon at
the end of 2023 was EUR 0.9 billion based on the stock
price of EUR 5.20.
In 2023, approximately 61.6 million Citycon shares
were traded on the Helsinki Stock Exchange. The
daily average trading volume was 245,521 shares,
representing a daily average turnover of approximately
EUR 1.5 million.
Shareholders
The number of registered shareholders at year-end
2023 was 27,738 (28,817). Shares owned by nominee-
registered parties equaled 70.2% at year-end 2023
(69.2%). Citycon is one of the companies on the Helsinki
Stock Exchange with the most international ownership
base.
Largest shareholders
Citycon’s largest shareholders according to Euroclear
Finland are listed in the table below.
In total, G City Ltd. and its wholly-owned subsidiary
Gazit Europe Netherlands own 50.9% of the total
shares and votes in the company (87,559,016 shares
as of 31 December 2023). Their shareholdings are
mostly nominee-registered. The above-mentioned
shareholdings include their direct ownership mentioned
on the table above.
Dividend payout
Cityon’s financial target is to pay out a minimum of 50%
of the profit for the period after taxes, excluding fair
value changes on investment properties.
The Board of Directors proposes to the AGM that
the Board of Directors be authorized to decide in its
discretion on the distribution of assets from the invested
unrestricted equity fund in the manner set forth below.
Share price and trading
2023 2022 2021 2020 2019
Number of shares traded
1
1,000 x 61,626 84,382 94,293 68,046 28,320
Stock turnover % 35.8 50.2 56.0 38.2 15.9
Share price, high
1
EUR 7.01 7.57 8.18 9.99 10.08
Share price, low
1
EUR 4.89 5.96 6.67 5.22 8.10
Share price, average
1
EUR 5.93 6.81 7.37 7.19 9.18
Share price, closing
1
EUR 5.20 6.26 7.00 7.93 9.37
Market capitalisation, period-end MEUR 894.37 1,050.90 1,179.50 1,411.53 1,666.96
Number of shares, period-end 1,000 x 171,994 168,009 168,499 177,999 177,999
1
Comparative figures adjusted to reflect the reverse split on March 18, 2019.
7
6
5
4
Share price and volume
Number of shares, thousands
Citycon share price
Citycon share volume
1,400
1,200
1,000
800
600
400
200
0
January 2023 December 2023
EUR
36
Financial statementsFinancial review Financial Review 2023
Major shareholders 31 December 2023
In total, G City Ltd. (former Gazit-Globe Ltd.) and its
wholly-owned subsidiary Gazit Europe Netherlands
own 50.9% of the total shares and votes in the
company (87,559,016 shares as of 31 December 2023).
Their shareholdings are mostly nominee-registered.
The above-mentioned shareholdings include their
direct ownership mentioned on the list below. More
information on ownership of G City Ltd and Gazit Europe
Netherlands BV is available on company’s website
citycon.com/investors/major-shareholders
Major shareholders 31 December 2023
Shares %
Ilmarinen Mutual Pension Insurance Company 12,694,139 7.38
Elo Mutual Pension Insurance Company 1,240,000 0.72
The State Pension Fund 1,200,000 0.70
OP-Henkivakuutus Ltd. 929,245 0.54
Zeroman Oy 711,666 0.41
Nordea Life Assurance Finland Ltd. 637,517 0.37
Pakkanen Mikko Pertti Juhani 500,000 0.29
G City Ltd
1
382,174 0.22
Mandatum Life Insurance Company Ltd. 347,718 0.20
Rantalainen-Yhtiöt Oy 320,000 0.19
10 largets shareholders, total 18,962,459 11�03
Nominee-registered shares 120,771,789 70.22
Others 32,259,956 18.76
Total 171,994,204 100
1
Includes non-nominee-registered ownership. In total, G City Ltd. and its wholly-owned subsidiary Gazit Europe Netherlands own 50.9% of the total shares and
votes in the company (87,559,016 shares as of 31 December 2023).
Shareholders by ownergroup 31 December 2023
Number of shareholders % Number of shares %
Financial and insurance corporations 26 0.09 117,015,607 68.04
Corporations 1,117 4.03 6,109,315 3.55
Households 26,350 95 23,948,535 13.92
General government 5 0.02 15,205,647 8.84
Foreign 72 0.26 7,550,669 4.39
Non-profit institutions 157 0.57 2,164,431 1.26
Total 27,738 100 171,994,204 100
Shareholdings by number of shares 31 December 2023
Number of shares Number of shareholders % Number of shares %
1–100 8,975 32.36 402,733 0.23
101–1,000 13,683 49.33 5,409,312 3.14
1,001–10,000 4,594 16.56 12,983,942 7.55
10,001–100,000 451 1.63 10,925,786 6.35
100,001–1,000,000 28 0.1 8,764,861 5.1
1,000,001 + 7 0.03 133,507,570 77.62
Total 27,738 100 171 ,994,204 100
Based on this authorization, the maximum total amount
of equity repayment distributed from the invested
unrestricted equity fund shall not exceed EUR 0.30
per share. Based on the current total number of issued
shares in the company (171,994,204), the authorization
would equal to a maximum of EUR 51,598,261.2 in equity
repayment.
The authorization is valid until the opening of the next
Annual General Meeting.
Unless the Board of Directors decides otherwise for
a justified reason, the authorization will be used to
distribute equity repayment four times during the period
of validity of the authorization. The Board of Directors
will make separate resolutions on each distribution of
the equity repayment so that the preliminary record and
payment dates will be as set out below. Citycon shall
make separate announcements of each such Board
resolution.
Preliminary payment date Preliminary record date
28 March 2024 21 March 2024
28 June 2024 20 June 2024
30 September 2024 23 September 2024
31 December 2024 20 December 2024
The equity repayment based on the resolution of
the Board of Directors will be paid to a shareholder
registered in the company’s shareholders’ register
maintained by Euroclear Finland Ltd on the record date
of the equity repayment.
37
Financial statementsFinancial review Financial Review 2023
Key figures and financial development for five years
Formula 2023 2022 2021 2020 2019
Income statement data
Gross rental income 215.3 222.3 222.2 224.3 232.1
Net rental income
Finland 76.4 68.6 66.5 66.2 72.2
Norway 62.5 78.9 77.8 74.1 75.4
Sweden 27.8 30.4 32.0 39.0 41.3
Denmark & Estonia 29.3 26.0 26.0 26.0 28.3
Other -0.4 -0.3 0.0 0.1 0.3
Net rental income total 195.7 203.6 202.3 205.4 217.4
Other operating income and expense 0.0 -26.5 -0.4 0.9 2.8
Operating profit/loss -38.0 87.7 217.8 34.1 73.1
Profit/loss before taxes -122.3 15.1 156.5 -45.7 2.2
Profit/loss attributable to parent company shareholders -115.0 5.3 121.0 -28.0 8.9
Statement of financial position data
Investment properties 3,858.2 4,040.1 4,189.2 4,152.2 4,160.2
Current assets 82.3 135.9 145.0 77.8 74.2
Total equity 1,987.5 2,310.3 2,489.5 2,166.0 2,325.2
Equity attributable to parent company shareholders 1,380.1 1,618.8 1,800.1 1,818.6 1,978.4
Non-controlling interest 0.0 0.0 0.3 0.2 0.1
Interest-bearing liabilities 1,864.4 1,807.7 1,878.5 2,121.2 1,874.4
Total liabilities 2,220.9 2,150.5 2,313.5 2,514.0 2,257.1
Total liabilities and shareholders’ equity 4,208.4 4,460.7 4,803.0 4,680.0 4,582.3
Number of properties
1
34 34 37 41 39
1
Kista Galleria 50% not included.
2
LTV 2021 changed due to correction related to presentation of IFRS 16 assets. Previously reported LTV for 2021 was 40.7.
3
The Board of Directors proposes that based on the balance sheet to be adopted for the financial period ended on 31 December 2023, no dividend is distributed
by a resolution of the Annual General Meeting.
Nonetheless, the Board of Directors proposes that the Board of Directors be authorized to decide in its discretion on the distribution assets from the invested
unrestricted equity fund in the manner set forth below. Based on this authorization, the maximum total amount of equity repayment distributed from the invested
unrestricted equity fund shall not exceed EUR 0.30 per share.
4
Issue-adjusted number of shares excluding Treasury shares held by the company.
Formulas are presented on section Formulas for key figures and ratios.
The numbers include the sale of four investments properties during 2022.
Formula 2023 2022 2021 2020 2019
Key performance ratios
Equity ratio, % 1 47.4 51.8 52.0 46.4 50.9
Loan to value (LTV), %
2
2 46.3 41.4 40.3 46.9 42.4
Return on equity, % (ROE) 3 -7.5 0.3 6.6 0.0 0.4
Return on investment, % (ROI) 4 -1.9 1.5 4.8 2.8 2.3
Quick ratio 5 0.2 0.7 2.6 0.7 0.3
Gross capital expenditure, MEUR 95.9 177.0 224.1 344.4 106.0
% of gross rental income 44.5 79.6 100.9 153.5 45.7
Per-share figures and ratios
Earnings per share, EUR 6 -0.70 -0.15 0.55 -0.25 0.04
Earnings per share, diluted, EUR 7 -0.70 -0.15 0.54 -0.25 0.04
Net cash from operating activities per share, EUR 8 0.75 0.59 0.72 0.71 0.76
Equity per share, EUR 9 11.56 13.75 14.80 12.17 13.06
P/E (price/earnings) ratio 10 - - - - 187
Return from invested unrestricted equity fund per
share, EUR
3
0.50 0.50 0.45 0.49 0.60
Dividend per share, EUR
3
- - 0.05 0.05 0.05
Dividend and return from invested unrestricted equity
fund per share total, EUR
3
0.50 0.50 0.50 0.54 0.65
Dividend and return of equity per earnings, % 11 - - 91.6 - 1,603.1
Effective dividend and return of equity yield, % 12 9.6 8.0 7.1 6.8 6.9
Issue-adjusted average number of shares (1,000)
4
168,285 168,011 177,033 177,998 177,997
Issue-adjusted number of shares at the end of financial
year (1,000)
4
171,994 168,009 168,202 177,999 177,999
Operative key ratios
Occupancy rate (economic), %
1
13 94.9 94.5 93.4 93.9 95.5
Citycon's GLA, sq.m.
1
1,011,490 1,013,390 1,059,090 1,136,390 1,074,590
Personnel (at the end of the period) 234 251 251 246 234
38
Financial statementsFinancial review Financial Review 2023
Formulas for key figures and ratios
1) Equity ratio, % Total Equity
X 100
Balance sheet total - advances received
2) Loan to value (LTV), % Interest bearing liabilities – lease liabilities (IFRS 16) – cash and cash equivalents
X 100
Fair value of investment properties + properties held for sale + investments in joint
ventures - right-of-use assets classified as investment properties (IFRS 16)
3) Return on equity (ROE), % Profit/loss for the period
X 100
Total Equity attributable to parent company shareholders (weighted average)
4) Return on investment (ROI), % Profit/loss before taxes + interest and other financial expenses
X 100
Balance sheet total (average) - non-interest-bearing liabilities (average)
5) Quick ratio Current assets
Short-term liabilities
6) Earnings per share (EPS), EUR
1
Profit/loss for the period
X 100
Average number of shares for the period
7) Earnings per share, diluted, EUR
1
Profit/loss for the period
X 100
Diluted average number of shares for the period
8) Net cash from operating activities
per share, EUR
Net cash from operating activities
X 100
Average number of shares for the period
9) Equity per share, EUR Total equity
Number of shares on the balance sheet date
10) P/E ratio (price/earnings) Closing price at year-end
EPS
11) Dividend and return of equity
per earnings, %
Dividend and return of equity per share
X 100
EPS
12) Effective dividend and
return of equity yield, %
Dividend and return of equity per share
X 100
Closing price at year-end
13) Occupancy rate (economic), % Gross rental income as per leases
X 100
Estimated market rent of vacant premises + gross rental income as per leases
1
Transaction costs and coupons on hybrid bond are deducted from the profit/loss for the period attributable to parent company shareholders, despite the
recognition date (coupons are recorded based on the commitment to the payment). In addition, gains and expenses on hybrid bond repayments are included in
the calculation.
39
Financial statementsFinancial review Financial Review 2023
Financial
statements
Citycon Oyj’s consolidated financial statements ������ 41
Consolidated income statement, IFRS .............................. 41
Consolidated statement of
other comprehensive income, IFRS .....................................41
Consolidated statement of financial position, IFRS ....42
Consolidated cash flow statement, IFRS ..........................43
Consolidated statement of changes
in shareholders’ equity, IFRS .................................................... 44
Notes to the consolidated financial statements ��������� 45
Parent company financial statements, FAS ���������������� 82
Notes to the parent company‘s financial
statements, FAS ............................................................................. 85
Signatures to the financial statements ..............................89
Auditor’s report ...............................................................................90
40
Financial statementsFinancial review Financial Review 2023
Citycon Oyj’s consolidated financial statements
Consolidated income statement, IFRS
MEUR Note 2023 2022
Gross rental income 1.2. 215.3 222.3
Service charge income 1.3. 74.7 79.2
Property operating expenses 1.4. -92.8 -94.7
Other expenses from leasing operations -1.6 -3.1
Net rental income 1.1. 195.7 203.6
Administrative expenses 1.5. -31.1 -28.7
Other operating income and expenses 1.3, 1.7. 0.0 -26.5
Net fair value gains/losses on investment property 2.1. -200.3 -56.5
Net gains/losses on sale of investment property 2.1., 2.2. -2.3 -4.3
Operating profit -38.0 87.7
Financial income 87.7 99.6
Financial expenses -135.3 -147.7
Net financial income and expenses 3.2. -47.7 -48.0
Share of profit of associated companies and joint ventures 2.4. -36.7 -24.6
Profit before taxes -122.3 15.1
Current taxes 4.1. -2.9 -2.1
Change in deferred taxes 4.2. 10.3 -7.9
Income taxes 7.4 -10.0
Profit for the period -115.0 5.1
Profit attributable to
Parent company shareholders -115.0 5.3
Non-controlling interest 0.0 -0.3
Earnings per share attributable to parent company shareholders:
1
Earnings per share (basic), EUR 1.8. -0.70 -0.15
Earnings per share (diluted), EUR 1.8. -0.70 -0.15
1
The key figure includes hybrid bond coupons (both paid and accrued not yet recognized) and amortized fees and gains and expenses on hybrid bond
repayments.
Consolidated statement of other comprehensive income, IFRS
MEUR Note 2023 2022
Profit for the period -115.0 5.1
Other comprehensive expenses/income
Items that may be reclassified to profit or loss in subsequent periods
Net gains/losses on cash flow hedges 3.2. -3.4 0.5
Share of other comprehensive income of associated companies and
joint ventures 0.0 0.0
Exchange gains/losses on translating foreign operations -51.7 -73.5
Net other comprehensive income that may be reclassified to profit
or loss in subsequent periods -55.0 -73.0
Other comprehensive expenses for the period, net of tax -55.0 -73.0
Total comprehensive profit/loss for the period -170.0 -67.9
Total comprehensive profit/loss attributable to
Parent company shareholders -170.0 -67.6
Non-controlling interest 0.0 -0.3
Operational performance remained solid in 2023
Overall financial performance was impacted by
weaker Norwegian and Swedish Krona compared
to previous year and disposals made in 2022.
Operating profit and profit for the period decreased
due to negative investment property fair value
development. The net fair value loss from investment
properties was EUR 200.3 million and share of loss of
associated companies and joint ventures EUR 36.7
million due to valuation result in Kista.
2022 1 2 3 4 5 2023
Change in operating profit
MEUR
1 Change in net rental income
2 Change in administrative expenses
3 Change in other operating income and expenses
4 Change in fair value gains/losses
5 Change in gains/losses on sale
-143.7
26.5
-2.4
-8.0
2.0
-38.0
87.7
41
Financial statementsFinancial review Financial Review 2023
Consolidated statement of financial position, IFRS
MEUR Note 31 December 2023 31 December 2022
ASSETS
Non-current assets
Investment properties 2.1. 3,858.2 4,040.1
Goodwill 5.1. 111.4 115.4
Investments in associated companies and joint ventures 2.4. 72.4 103.5
Intangible assets 4.3. 10.7 11.0
Property, plant and equipment 2.4 1.6
Deferred tax assets 4.2. 16.5 16.4
Derivative financial instruments and other non-current assets 3.6. 54.7 36.8
Total non-current assets 4,126.1 4,324.9
Investment properties held for sale 2.2. 0.0 0.0
Current assets
Derivative financial instruments 3.6. 0.1 2.8
Current tax receivables 4.1. 0.6 4.4
Trade and other receivables 3.3., 4.4. 56.3 59.4
Cash and cash equivalents 3.8. 25.2 69.2
Total current assets 82.3 135.9
Total assets 4,208.4 4,460.7
MEUR Note 31 December 2023 31 December 2022
EQUITY AND LIABILITIES
Equity 3.1.
Share capital 259.6 259.6
Share premium fund 131.1 131.1
Fair value reserve -1.4 1.9
Invested unrestricted equity fund 596.8 660.2
Translation reserve -240.0 -188.3
Retained earnings 634.1 754.3
Total equity attributable to parent company shareholders 1,380.1 1,618.8
Hybrid bond 3.1. 607.3 691.5
Non-controlling interest 0.0 0.0
Total equity 1,987.5 2,310.3
Long-term liabilities
Loans 3.3., 3.4. 1,502.8 1,676.1
Derivative financial instruments 3.3., 3.6. 22.6 0.1
Deferred tax liabilities 4.2. 247.8 266.3
Other liabilities 3.3. 0.2 0.3
Total long-term liabilities 1,773.4 1,942.8
Short-term liabilities
Loans 3.3., 3.4. 361.6 131.6
Derivative financial instruments 3.3., 3.6. 5.3 0.4
Current tax liabilities 4.1. 2.4 2.8
Trade and other payables 3.3., 4.5. 78.3 72.8
Total short-term liabilities 447.5 207.6
Total liabilities 2,220.9 2,150.5
Total liabilities and equity 4,208.4 4,460.7
Investment property values decreased
Fair value of investment properties decreased due to fair value losses of EUR 200.3 million and due to changes in
exchange rates EUR 76.2 million, investments increased the value of investment properties by EUR 92.8 million.
Shareholders equity was negatively impacted especially by weakening of Norwegian Krona during the year.
2023 2022
Assets
MEUR
5,000
4,000
3,000
2,000
1,000
0
Other current assets
Cash and cash equivalents
Investment properties held
for sale
Other non-current assets
Goodwill
Investment in associated
companies and joint ventures
Investment properties
2023 2022
Equity and liabilities
MEUR
5,000
4,000
3,000
2,000
1,000
0
Other short-term liabilities
Other long-term liabilities
Deferred tax liabilities
Loans
Total equity
42
Financial statementsFinancial review Financial Review 2023
Consolidated cash flow statement, IFRS
MEUR Note 2023 2022
Cash flow from operating activities
Profit before taxes -122.3 15.1
Adjustments 290.3 166.5
Cash flow before change in working capital 168.0 181.5
Change in trade and other receivables 4.4. 0.1 7.8
Change in trade and other payables 4.5. 5.7 -30.5
Change in working capital 5.8 -22.7
Cash generated from operations 173.8 158.8
Interest expenses and other financial expenses paid -51.0 -53.9
Interest income and other financial income received 1.7 0.2
Taxes paid 2.4 -5.4
Net cash from operating activities 126.8 99.7
Cash flow from investing activities
Acquisition of subsidiaries, less cash acquired 2.1. - -6.5
Capital expenditure on investment properties 2.1. -94.4 -169.3
Capital expenditure on investments in joint ventures, intangible
assets and PP&E 2.4., 4.3. -2.3 -4.6
Sale of investment properties 2.1., 2.2. -0.4 270.9
Purchase of current financial investments - -64.8
Repayment of current financial investments - 84.2
Net cash used in investing activities -97.1 109.8
Cash flow from financing activities
Proceeds from short-term loans 3.4. 357.3 356.5
Repayments of short-term loans 3.4. -433.8 -318.7
Proceeds from long-term loans 3.4. 405.3 -
Repayments of long-term loans 3.4. -257.5 -102.5
Hybrid bond repayments 3.1. -39.2 -
Hybrid bond interest and expenses 3.1. -29.1 -28.4
Repurchase of treasury shares and costs 3.1. - -1.6
Dividends and return from the invested unrestricted equity fund 3.1. -84.4 -84.0
Realised exchange rate gains and losses 9.4 6.8
Net cash from/used in financing activities -72.0 -172.0
Net change in cash and cash equivalents -42.3 37.5
Cash and cash equivalents at period-start 3.8. 69.2 34.7
Effects of exchange rate changes -1.6 -3.1
Cash and cash equivalents at period-end 3.8. 25.2 69.2
MEUR Note 2023 2022
Adjustments:
Depreciation and amortisation 1.5., 4.3. 3.0 2.4
Net fair value gains/losses on investment property 2.1. 200.3 56.5
Gains/losses on disposal of investment property 2.2. 2.3 4.3
Financial income 3.2. -87.7 -99.6
Financial expenses 3.2. 135.3 147.7
Share of profit of associated companies and joint ventures 2.4. 36.7 24.6
Share-based payments 1.6. 1.7 3.2
Other adjustments -1.3 27.4
Total 290.3 166.5
MEUR Note 2023 2022
Net cash from operating activities 126.8 99.7
Average number of shares (1,000) 168,285 168,011
Net cash from operating activities per share 0.75 0.59
Net cash from operating activities increased to EUR 126�8 million from previous year’s EUR 99�7 million
During 2023 Citycon invested EUR 96.7 million mainly in investment properties. Investments and debt
repayments were mainly financed by cash generated from operations. Net cash from operations per share
increased to EUR 0.75 mainly due to change in trade and other payables. Citycon repurchased bonds for EUR
183.8 million of cash and hybrid bonds for EUR 39.2 million of cash during 2023. In addition two mortage loans
were issued with proceeds of EUR 334.3 million.
2022 1 2 3 4 5 6 7 2023
Cash needs and cash proceeds
MEUR
-96.7
-84.4
-29.1
71.2
7.3
-39.2
126.8
69.2
25.2
1 Cash from operations
2 Investments
3 Dividends and equity returns
4 Hybrid bond repayments
5 Hybrid bond interest and expenses
6 Net of proceeds and repayments of loans
7 Other
43
Financial statementsFinancial review Financial Review 2023
Consolidated statement of changes in shareholders’ equity, IFRS
Equity attributable to parent company shareholders
MEUR
Share
capital
Share
premium
fund
Fair
value
reserve
Invested
unrestricted
equity fund
Translation
reserve
Retained
earnings Total Hybrid bond
Non-
controlling
interest Total equity
Balance at 1 January 2022 259.6 131.1 1.4 744.2 -114.8 778.6 1,800.1 689.1 0.3 2,489.5
Profit for the period 2022 5.3 5.3 -0.3 5.1
Net gains on cash flow hedges (Note 3.2.) 0.5 0.5 0.5
Share of other comprehensive income of joint ventures 0.0 0.0
Exchange gains/losses on translating foreign operations -73.5 -73.5 0.0 -73.5
Total other comprehensive expenses/income for the period,
net of tax 0.5 -73.5 -73.0 0.0 -73.0
Total comprehensive loss/profit for the period 0.5 -73.5 5.3 -67.6 -0.3 -67.9
Hybrid bond interest and expenses (Note 3.1.) -30.6 -30.6 2.4 -28.2
Repurchase of treasury shares and costs (Note 3.1.) -1.6 -1.6 -1.6
Dividends and return from the invested unrestricted equity
fund (Note 3.1.) -84.0 -84.0 -84.0
Share-based payments (Note 1.6.) 2.4 2.4 2.4
Other changes 0.1 0.1 0.1
Balance at 31 December 2022 259.6 131.1 1.9 660.2 -188.3 754.3 1,618.8 691.5 0.0 2,310.3
Profit for the period 2023 -115.0 -115.0 -115.0
Net gains on cash flow hedges (Note 3.2.) -3.4 -3.4 -3.4
Exchange gains/losses on translating foreign operations -51.7 -51.7 -51.7
Total other comprehensive income/expenses for the period,
net of tax -3.4 -51.7 -55.0 -55.0
Total comprehensive profit/loss for the period -3.4 -51.7 -115.0 -170.0 -170.0
Hybrid bond repayments (Note 3.1.) 0.0 -85.9 -85.9
Gains on hybrid bond repayments (Note 3.1.) 25.8 25.8 25.8
Hybrid bond interest and expenses (Note 3.1.) -30.7 -30.7 1.8 -28.9
Share issue (Note 3.1.) 20.9 20.9 20.9
Dividends paid and equity return (Note 3.1.) -84.4 -84.4 -84.4
Share-based payments (Note 1.6.) -0.3 -0.3 -0.3
Other changes 0.0 0.0 0.0
Balance at 31 December 2023 259.6 131.1 -1.4 596.8 -240.0 634.1 1,380.1 607.3 0.0 1,987.5
Profit for the period and equity return
decreased equity
Profit for the period was EUR -115.0 million. During
2023, Citycon paid an equity return of EUR 0.50
per share from the invested unrestricted equity
fund. Distributed equity return in total was EUR
84.4 million. Translation losses were EUR -51.7
million. During 2023, Citycon also completed
two directed share issues in exchange for
repurchasing of its hybrid bonds.
1 4 72022 2023
2 5 83 6 9
Development of equity per share
MEUR
0.15
-0.32
-0.02
-0.50
-0.49
0.12
-0.67
-0.30
-0.17
11.56
13.75
1
Profit for the period
2
Translation differences
3
Share issue
4
Dividends and equity return
5
Hybrid bond repayments
6
Gains on hybrid bond
repayments
7 Hybrid bond interest and
expenses
8 Effect of share issue on share
amount
9 Other changes
Equity/shareEquity/share
44
Financial statementsFinancial review Financial Review 2023
Notes to the consolidated financial statements
45
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Basic company data
As a real estate investment company specialising in
Finnish law and domiciled in Helsinki , the address of its
registered office being Piispansilta 9 A 1, 02230 Espoo .
The official name of the company is Citycon Oyj .
A copy of Citycon’s consolidated financial statements
is available on the corporate website at
www.citycon.com and from the Group’s headquarters at
the address Piispansilta 9 A FI-02230 Espoo, Finland .
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Tot a l
XXX,X
Meur
Operating expenses 2023
MEUR
Heating and electricity -24.2
Maintenance expenses -31.3
Property personnel expenses -9.5
Administrative and management fees -2.1
Marketing expenses -6.8
Property insurances -1.5
Property taxes -8.7
Repair expenses -4.6
Other property operating expenses -4.0
Tot a l
-92.8
MEUR
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2022 1 2 3 4 5 6 2023
Investment properties 2023
MEUR
1 Investments and capitalised interest
2 Fair value gains
3 Fair value losses
4 Valuation gains and losses from
Right-of-Use-Assets
5 Exchange differences
6 Changes in Right-of-Use-Assets classified
as investment properties (IFRS 16)
22.8
1.8
-76.2
92.8
-6.6
-216.5
4,040.1
3,858.2
2021 1 2 3 4 5 6 7 8 9 2022
Investment properties 2022
MEUR
4,189.2
4,040.1
1 Acquisitions
2 Investments and capitalised interest
3 Disposals
4 Fair value gains
5 Fair value losses
6 Valuation gains and losses from
Right-of-Use-Assets
7 Exchange differences
8 Changes in Right-of-Use-Assets classified as
investment properties (IFRS 16)
9 Transfers between items
53.1
6.4
-22.1
-122.3
165.7
-6.8
6.3
-102.9
-126.5
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Parent company financial statements, FAS
Parent company income statement, FAS
MEUR Note
1 January –
31 December 2023
1 January –
31 December 2022
Service charge income 5.8 2.4
Turnover 2 5�8 2�4
Administrative expenses 3,4 -20.0 -16.3
Other operating income and expenses 5 -0.2 0.0
Operating profit -14�3 -13�9
Financial income 183.0 112.2
Financial expenses -143.3 -147.6
Net financial income and expenses 6 39.7 -35.4
Profit/loss before appropriations and taxes 25�3 -49�4
Group contributions 6.0 0.8
Income tax expense 7 0.0 0.0
Profit/loss for the period 31�3 -48�6
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Parent company balance sheet, FAS
MEUR Note 31 December 2023 31 December 2022
ASSETS
Non-current assets
Intangible assets 8 9.7 9.7
Tangible assets 9 0.3 0.4
Investments
Shares in subsidiaries 10 1,286.3 1,275.0
Loan receivables and derivative contracts 11 1,544.1 1,980.3
Total investments 2,830.4 3,255.3
Total non-current assets 2,840�4 3,265�4
Current assets
Short-term receivables 13 586.0 84.4
Cash and cash equivalents 0.1 0.1
Total current assets 586�1 84�5
Total assets 3,426�4 3,349�9
MEUR Note 31 December 2023 31 December 2022
LIABILITIES AND SHAREHOLDERS’ EQUITY
Shareholders’ equity 14
Share capital 259.6 259.6
Share premium fund 133.1 133.1
Invested unrestricted equity fund 612.8 676.0
Retained earnings -65.9 -17.3
Profit for the period 31.3 -48.6
Total shareholders’ equity 970�8 1,002�8
Liabilities 15
Long-term liabilities
Hybrid bond 607.8 692.3
Other long-term liabilities 1,301.9 1,533.3
Total long-term liabilities 1,909�7 2,225�6
Short-term liabilities
Short-term liabilities 545.9 121.5
Total short-term liabilities 545�9 121�5
Total liabilities 2,455�6 2,347�1
Total liabilities and shareholders’ equity 3,426�4 3,349�9
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Parent company cash flow statement, FAS
MEUR
1 January –
31 December 2023
1 January –
31 December 2022
Cash flow from operating activities
Profit before taxes 25.3 -49.4
Adjustments:
Depreciation and impairment loss 2.1 1.6
Net financial income and expenses -39.7 35.4
Cash flow before change in working capital -12.2 -12.3
Change in working capital -0.7 -1.9
Cash generated from operations -13�0 -14�3
Interest expense and other financial expenses paid -85.8 -76.1
Interest income and other financial income received 105.4 64.8
Realised exchange rate gains and losses 9.4 -3.9
Net cash flow from operating activities 16�0 -29�5
Cash flow used in investing activities
Investment in tangible and intangible assets -2.0 -3.9
Loans granted -341.9 -375.4
Repayments of loans receivable 94.9 558.7
Purchase of current financial investments - -64.8
Repayment of current financial investments - 84.2
Net cash from investing activities -249�0 198�7
Cash flow from financing activities
Proceeds from short-term loans 362.9 367.9
Repayments of short-term loans -365.6 -328.2
Proceeds from long-term loans 317.5 -
Repayments of long-term loans -73.6 -
Repayments of hybrid bond -39.2 -
Received group contributions 0.8 -
Dividends paid and return from the invested unrestricted equity fund -84.4 -84.0
Purchase and costs of purchase of treasury shares - -1.6
Net cash used in financing activities 118�4 -45�9
Net change in cash and cash equivalents -114�6 123�3
Cash and cash equivalents at period-start -6.0 -129.3
Cash and cash equivalents at period-end
1
-120�6 -6�0
1
Cash and cash equivalents of Citycon Oyj EUR -120.6 million consist of EUR 0.1 million cash and bank receivables in the balance sheet and Group cash pool
account EUR -120.7 million. Cash pool balance of EUR -120.7 million has been recognised in the parent company’s balance sheet under short-term liabilities.
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Notes to the parent company’s financial statements, FAS
1. Accounting policies
The parent company’s financial statements are
prepared in accordance with the Finnish law.
Income statement format
The income statement is presented in accordance with
the function-based format.
Non-current assets
Non-current assets are recognised in the balance
sheet at acquisition cost less impairment losses and
depreciation/amortisation.
Intangible assets
Intangible assets include IT software and other non-
current assets, including office improvement expenses.
IT software is depreciated over 3–10 years as straight
line basis and office improvement expenses are
depreciated over the term of the lease agreement.
Tangible assets
Tangible assets include machinery and equipment and
construction in progress. Machinery and equipment is
depreciated at over 3–7 years as straight line basis.
Pension schemes
The company’s employee pension cover is based on
statutory pension insurance.
Foreign currency receivables and payables
Receivables and payables denominated in foreign
currencies as well as forward rate agreements are
measured at the exchange rate quoted on the balance
sheet date. Any exchange rate differences resulting from
currency translations are recognised as exchange rate
differences in the income statement.
Income taxes
Current taxes are recognised on an accrual basis.
Deferred taxes arising from temporary differences
between the book and fiscal values have been
recognised separately in the income statement and the
balance sheet.
Derivatives
All derivatives are valued according to the Finnish
bookkeeping act KPL 5.2a at fair value.
Important note
Individual figures and sum totals presented in the
financial statements have been rounded to the nearest
hundreds thousands of euros; this may cause minor
discrepancies between the sum totals and the sums of
individual figures as given.
2. Turnover
MEUR 2023 2022
Turnover by country:
Finland 2.1 0.5
Other countries 3.7 1.9
Total 5�8 2�4
Parent company turnover includes the following
administrative fees received from Group
companies:
MEUR 2023 2022
Administrative fees from Group
companies 5.8 2.4
3. Personnel expenses
MEUR 2023 2022
Average number of employees during
period 51 52
Personnel expenses
Wages and salaries -9.7 -8.0
Pension charges -1.3 -0.8
Other social charges -2.0 -1.1
Total -12�9 -9�9
Personnel expenses include the following
management wages and salaries:
MEUR 2023 2022
CEO’s wages and salaries -1.3 -1.2
Board remuneration -0.6 -0.8
Total -2�0 -1�9
The wages and salaries of the CEO includes the gross
base salary and a yearly performance bonus. In addition,
the CEO is included in the Restricted Share Plan and has
been rewarded under the plan during the year.
4. Depreciation and amortisation
and impairments
The following depreciation and amortisation
as well as impairments are included in the
administrative expenses:
MEUR 2023 2022
Amortisation on intangible assets -1.9 -1.5
Depreciation on machinery and
equipment -0.2 -0.2
Total -2�1 -1�6
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5. Other operating income and expenses
MEUR 2023 2022
Other operating income -0.2 0.0
Total -0�2 0�0
6. Net financial income and expenses
MEUR 2023 2022
Interest and other financial income
From Group companies 113.8 76.3
Foreign exchange gains 41.3 35.1
Other interest and financial income 27.8 0.8
Total 183�0 112�2
Total financial income 183�0 112�2
Interest and other financial expenses
To Group companies 41.2 47.1
Foreign exchange losses 53.3 55.1
Interest and other financial expenses 48.8 45.4
Total financial expenses 143�3 147�6
Net financial income and expenses 39�7 -35�4
7. Income tax expense
MEUR 2023 2022
Income tax expense 0.0 0.0
Total 0�0 0�0
The parent company has taxable losses (including not
yet confirmed year 2023) of EUR 88.9 million from which
the parent company has not recognized deferred tax
asset of EUR 17.8 million.
8. Intangible assets
MEUR 2023 2022
Intangible rights
Acquisition cost 1 January 18.9 15.3
Additions during the period 2.0 3.6
Accumulated acquisition costs 31
December 20.9 18.9
Accumulated depreciation 1 January -10.0 -8.7
Depreciation for the period -1.8 -1.3
Accumulated depreciation 31 December -11.7 -10.0
Net carrying amount 31 December 9�2 8�9
Other non-current assets
Acquisition cost 1 January 2.7 2.6
Additions during the period 0.0 0.1
Accumulated acquisition costs 31
December 2.7 2.7
Accumulated depreciation 1 January -2.0 -1.8
Depreciation for the period -0.2 -0.2
Accumulated depreciation 31 December -2.1 -2.0
Net carrying amount 31 December 0�6 0�7
Total intangible assets 31 December 9�7 9�7
9. Tangible assets
MEUR 2023 2022
Machinery and equipment
Acquisition cost 1 January 2.3 2.1
Additions during the period 0.0 0.2
Accumulated acquisition costs 31
December 2.4 2.3
Accumulated depreciation 1 January -2.0 -1.8
Depreciation for the period -0.2 -0.2
Accumulated depreciation 31 December -2.2 -2.0
Net carrying amount 31 December 0�3 0�4
Construction in progress
Acquisition cost 1 January 0.0 0.0
Net carrying amount 31 December 0�0 0�0
Total tangible assets 31 December 0�3 0�4
10. Shares in subsidiaries
MEUR 2023 2022
Acquisition cost 1 January 1,275.0 1,350.4
Additions during the period 11.2 0.0
Decreases - -75.4
Net carrying amount 31 December 1,286�3 1,275�0
11. Long-term loan receivables and
derivative contracts
MEUR 2023 2022
Loan receivables from Group companies 1,506.9 1,961.7
Derivative financial instruments, from
outside the Group 37.2 18.6
Total other investments 31 December 1,544�1 1,980�3
Total investments 31 December 2,830�4 3,255�3
12. Subsidiaries and associated
companies
Parent company’s subsidiaries and associated
companies are presented in the Note 5.3. Related Party
Transactions in the Notes to the Consolidated Financial
Statements.
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13. Short-term receivables and cash and
cash equivalents
MEUR 2023 2022
Receivables from outside the Group
Trade receivables 0.1 0.1
Derivative financial instruments 0.1 2.8
Other receivables 0.0 0.0
Cash and cash equivalents 0.1 0.1
Accrued income and prepaid
expenses 4.8 4.7
Total 5�1 7�7
Receivables from Group companies
Trade receivables 0.6 1.4
Loan receivables 555.1 59.0
Other receivables 1.5 1.1
Total other receivables 556.6 60.1
Interest receivables 17.7 14.4
Group contributions receivables 6.0 0.8
Total 580�9 76�7
Total short-term receivables 586�1 84�5
14. Shareholders’ equity
MEUR 2023 2022
Share capital at 1 January 259�6 259�6
Share capital at 31 December 259�6 259�6
Share premium fund at 1 January 133�1 133�1
Share premium fund at 31 December 133�1 133�1
Invested unrestricted equity fund
at 1 January 676�0 760�0
Equity return from the invested
unrestricted equity fund -84.4 -84.0
Share issue 21.1 -
Invested unrestricted equity fund
at 31 December 612�8 676�0
Retained earnings at 1 January -65�9 -15�9
Profit for the period 31.3 -48.6
Reversed repurchased Shares - -1.4
Retained earnings at 31 December -34�5 -65�9
Total shareholders’ equity at 31
December 970�8 1,002�8
The company has a single series of shares, with each share
entitling to one vote at a General Meeting of shareholders. During
the reporting period the company executed two directed share
issuances. At the end of reporting period, the total number of
shares outstanding in the company was 171,994,204.
Calculation of distributable unrestricted equity
MEUR 2023 2022
Invested unrestricted equity fund 612.8 676.0
Retained earnings -65.9 -15.9
Profit for the period 31.3 -48.6
Reversed repurchased Shares - -1.4
Total distributable unrestricted equity
31 December 578�2 610�1
15. Liabilities
A) Long-term liabilities
MEUR 2023 2022
Long-term interest-bearing liabilities
Loans from financial institutions 247.3 -
Hybrid bond 607.8 692.3
Loans from Group companies 1,031.9 1,533.2
Total 1,887�1 2,225�5
Derivative financial instruments 22.6 0.1
Total long-term liabilities 1,909�7 2,225�6
Loans maturing later than 5 years - 350�0
B) Short-term liabilities
MEUR 2023 2022
Short-term interest-bearing liabilities
Commercial paper 46.5 49.2
Loans from Group companies 437.2 10.1
Total 483�6 59�4
Short-term non-interest-bearing
liabilities
Payables to outside the Group
Accounts payable 1.2 0.2
Derivative financial instruments 5.2 0.1
Total other payables 5.2 0.1
Interest liability 15.4 17.8
Other accrued expenses and
deferred income 7.2 6.5
Total accrued expenses and
deferred income 22.6 24.3
Total 29�0 24�5
Payables to Group companies
Accounts payable 0.5 16.8
Derivative financial instruments - 1.9
Other payables 16.0 0.5
Interest liability 16.8 18.4
Total accrued expenses and
deferred income 16.8 18.4
Total 33�3 37�6
Total short-term liabilities 545�9 121�5
Total liabilities 2,455�6 2,347�1
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Financial statementsFinancial review Financial Review 2023
The company has a syndicated revolving credit facility,
which matures in 2026. In addition, the company has
two hybrid bonds issued in November 2019 and June
2021, which are reported under long term liabilities. The
hybrid bond is unsecured, subordinated to all debt and
senior only to ordinary share capital. A holder of hybrid
bond notes has no shareholder rights. Citycon has the
right to postpone interest payment on its hybrid bonds
if it does not distribute dividend or any other equity to
its shareholders. The hybrids has no set maturity date,
but the company has the right to redeem it after five
years from the issue date and thereafter on every yearly
interest payment date.
Derivative financial instruments are used in Citycon
group in accordance with the Treasury Policy to hedge
the interest rate risk of interest bearing liabilities and
foreign currency risk. All Group external derivative
financial instruments in Citycon are executed by the
parent company Citycon Oyj. Citycon Oyj values
derivatives according to the Finnish bookkeeping
act KPL 5.2a fair value model and fair value changes
are booked through profit and loss. The fair value
definition of derivatives are presented in note 3.6 of the
consolidated Financial Statements.
16. Contingent liabilities
A) Lease liabilities
MEUR 2023 2022
Payables on lease commitments
Maturing next financial year 0.4 0.4
Maturing later 1.3 1.3
Total 1�7 1�7
Citycon’s finance leases mainly apply to computer
hardware, machinery and equipment and cars.
B) Guarantees given
MEUR 2023 2022
Guarantees 1,518.8 1,801.7
Of which on behalf of Group
companies 1,518.8 1,801.7
Guarantees in 2023 and in 2022 mainly relate to issued
bonds of subsidiaries which Citycon Oyj has guaranteed
via parent guarantee or alternatively third party bank
guarantees.
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Signatures to the financial statements
Signatures to the Financial Statements 1 January–31 December 2023
Helsinki, 15 February 2024
Chaim Katzman Alexandre Koifman
Chairman Deputy Chairman of the Board
Judah Angster Zvi Gordon
Member Member
Adi Jemini David Lukes
Member Member
Per-Anders Ovin Ljudmila Popova
Member Member
F� Scott Ball
CEO, deputy Chairman of the Board
We have today submitted the report on the conducted audit.
Helsinki, 15 February 2024
Ernst & Young Oy
Authorized Public Accountant Firm
Antti Suominen
Authorized Public Accountant
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Financial statementsFinancial review Financial Review 2023
Auditor’s report
To the Annual General Meeting
of Citycon Oyj
Report on the Audit of
Financial Statements
Opinion
We have audited the financial statements of Citycon Oyj
(business identity code 0699505-3) for the year ended
31 December, 2023. The financial statements comprise
the consolidated balance sheet, income statement,
statement of comprehensive income, statement of
changes in equity, statement of cash flows and notes,
including material accounting policy information, as
well as the parent company’s balance sheet, income
statement, statement of cash flows and notes.
In our opinion
• the consolidated financial statements give a true and
fair view of the group’s financial position, financial
performance, and cash flows in accordance with IFRS
Accounting Standards as adopted by the EU.
• the financial statements give a true and fair view of
the parent company’s financial performance and
financial position in accordance with the laws and
regulations governing the preparation of financial
statements in Finland and comply with statutory
requirements.
Our opinion is consistent with the additional report
submitted to the Audit and Governance Committee.
(Translation of the Finnish original)
Basis for Opinion
We conducted our audit in accordance with good
auditing practice in Finland. Our responsibilities under
good auditing practice are further described in the
Auditor’s Responsibilities for the Audit of Financial
Statements section of our report.
We are independent of the parent company and of
the group companies in accordance with the ethical
requirements that are applicable in Finland and are
relevant to our audit, and we have fulfilled our other
ethical responsibilities in accordance with these
requirements.
In our best knowledge and understanding, the non-audit
services that we have provided to the parent company
and group companies are in compliance with laws
and regulations applicable in Finland regarding these
services, and we have not provided any prohibited non-
audit services referred to in EU Regulation No 537/2014,
point (c) of Article 10(2). The non-audit services that
we have provided have been disclosed in note 1.5 to the
consolidated financial statements.
We believe that the audit evidence we have obtained
is sufficient and appropriate to provide a basis for our
opinion.
Key Audit Matters
Key audit matters are those matters that, in our
professional judgment, were of most significance in our
audit of the financial statements of the current period.
These matters were addressed in the context of our
audit of the financial statements as a whole, and in
forming our opinion thereon, and we do not provide a
separate opinion on these matters.
We have fulfilled the responsibilities described in the
Auditor’s responsibilities for the audit of the financial
statements section of our report, including in relation
to these matters. Accordingly, our audit included the
performance of procedures designed to respond to
our assessment of the risks of material misstatement
of the financial statements. The results of our audit
procedures, including the procedures performed
to address the matters below, provide the basis for
our audit opinion on the accompanying financial
statements.
We have also addressed the risk of management
override of internal controls. This includes consideration
of whether there was evidence of management bias
that represented a risk of material misstatement due to
fraud.
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Responsibilities of the Board of Directors and the
Managing Director for the Financial Statements
The Board of Directors and the Managing Director are
responsible for the preparation of consolidated financial
statements that give a true and fair view in accordance
with IFRS Accounting Standards as adopted by the
EU, and of financial statements that give a true and
fair view in accordance with the laws and regulations
governing the preparation of financial statements in
Finland and comply with statutory requirements. The
Board of Directors and the Managing Director are also
responsible for such internal control as they determine
is necessary to enable the preparation of financial
statements that are free from material misstatement,
whether due to fraud or error.
In preparing the financial statements, the Board of
Directors and the Managing Director are responsible
for assessing the parent company’s and the group’s
ability to continue as going concern, disclosing, as
applicable, matters relating to going concern and using
the going concern basis of accounting. The financial
statements are prepared using the going concern basis
of accounting unless there is an intention to liquidate
the parent company or the group or cease operations, or
there is no realistic alternative but to do so.
Auditor’s Responsibilities for
the Audit of Financial Statements
Our objectives are to obtain reasonable assurance on
whether the financial statements as a whole are free
from material misstatement, whether due to fraud or
error, and to issue an auditor’s report that includes
our opinion. Reasonable assurance is a high level
of assurance, but is not a guarantee that an audit
conducted in accordance with good auditing practice
will always detect a material misstatement when it
exists. Misstatements can arise from fraud or error and
are considered material if, individually or in aggregate,
they could reasonably be expected to influence the
economic decisions of users taken on the basis of the
financial statements.
As part of an audit in accordance with good auditing
practice, we exercise professional judgment and
maintain professional skepticism throughout the audit.
We also:
• Identify and assess the risks of material misstatement
of the financial statements, whether due to fraud
or error, design and perform audit procedures
responsive to those risks, and obtain audit evidence
that is sufficient and appropriate to provide a
basis for our opinion. The risk of not detecting a
material misstatement resulting from fraud is higher
than for one resulting from error, as fraud may
involve collusion, forgery, intentional omissions,
misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant
to the audit in order to design audit procedures that
are appropriate in the circumstances, but not for the
purpose of expressing an opinion on the effectiveness
of the parent company’s or the group’s internal
control.
• Evaluate the appropriateness of accounting policies
used and the reasonableness of accounting estimates
and related disclosures made by management.
• Conclude on the appropriateness of the Board of
Directors’ and the Managing Director’s use of the
going concern basis of accounting and based on
the audit evidence obtained, whether a material
uncertainty exists related to events or conditions that
may cast significant doubt on the parent company’s
or the group’s ability to continue as a going concern.
If we conclude that a material uncertainty exists, we
are required to draw attention in our auditor’s report
to the related disclosures in the financial statements
Key Audit Matter How our audit addressed the Key Audit Matter
Valuation of Investment Properties
We refer to the note 2.1
At the balance sheet date, the fair value of investment properties
amounted to 3.858 million euro representing 92% of the total assets
and 194% of the total equity.
Fair value measurement of investment properties was a key audit
matter because the fair value measurement requires management
judgment and estimates and because the value of investment
properties is significant to the financial statements. Market rents,
yield requirement, vacancy rate and operating expenses are key
variables used in investment property fair-value measurement
process.
This matter is a significant risk of material misstatement referred to
in EU Regulation No 537/2014, point (c) of Article 10(2).
Our audit procedures to address the risk of material misstatement in
respect of valuation of investment properties included among others:
• Our valuation specialists assisted us in evaluating the assumptions
and methodologies used.
• We assessed the competence and objectivity of the external
appraiser engaged by the management of Citycon as well as
historical accuracy of management’s judgment and assumptions.
• We focused audit on the market rents, yield requirement, vacancy
rate and operating expenses.
The methodologies and key inputs used in the valuation and
sensitivity analysis are presented in note 2.1. We assessed the
adequacy of these disclosures.
Valuation of Goodwill
We refer to the note 5.1
At the balance sheet date, the carrying amount of goodwill amounted
to 111 million euro representing 3% of the total assets and 6% of the
total equity
Valuation of goodwill was a key audit matter because the
assessment process involves significant management judgment and
estimates. Citycon’s management applies assumptions in respect
of discount rate, net rental income projections and other operating
income and expenses.
This matter is a significant risk of material misstatement referred to
in EU Regulation No 537/2014, point (c) of Article 10(2).
Our audit procedures to address the risk of material misstatement in
respect of valuation goodwill included among others:
• Our valuation specialists assisted us in evaluating the
methodologies and assumptions used.
• We assessed the competence and objectivity of the external
appraiser engaged by the management of Citycon as well as
historical accuracy of management’s judgment and assumptions.
• We focused audit on how much the recoverable amount exceeds
the carrying amount of goodwill, and whether any reasonably
possible change in assumptions could cause the carrying amount
to exceed its recoverable amount.
The key assumptions used in the impairment test of goodwill
are presented in note 5.1. We assessed the adequacy of these
disclosures.
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Financial statementsFinancial review Financial Review 2023
or, if such disclosures are inadequate, to modify our
opinion. Our conclusions are based on the audit
evidence obtained up to the date of our auditor’s
report. However, future events or conditions may
cause the parent company or the group to cease to
continue as a going concern.
• Evaluate the overall presentation, structure and
content of the financial statements, including the
disclosures, and whether the financial statements
represent the underlying transactions and events so
that the financial statements give a true and fair view.
• Obtain sufficient appropriate audit evidence regarding
the financial information of the entities or business
activities within the group to express an opinion on the
consolidated financial statements. We are responsible
for the direction, supervision and performance of the
group audit. We remain solely responsible for our audit
opinion.
We communicate with those charged with governance
regarding, among other matters, the planned scope
and timing of the audit and significant audit findings,
including any significant deficiencies in internal control
that we identify during our audit.
We also provide those charged with governance with
a statement that we have complied with relevant
ethical requirements regarding independence, and
communicate with them all relationships and other
matters that may reasonably be thought to bear on
our independence, and where applicable, related
safeguards.
From the matters communicated with those charged
with governance, we determine those matters that
were of most significance in the audit of the financial
statements of the current period and are therefore the
key audit matters. We describe these matters in our
auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare
circumstances, we determine that a matter should not
be communicated in our report because the adverse
consequences of doing so would reasonably be
expected to outweigh the public interest benefits of
such communication.
Other Reporting Requirements
Information on our audit engagement
We were first appointed as auditors by the Annual
General Meeting on 5 April 2005, and our appointment
represents a total period of uninterrupted engagement
of 19 years.
Other information
The Board of Directors and the Managing Director
are responsible for the other information. The other
information comprises the report of the Board of
Directors and the information included in the Annual
Report, but does not include the financial statements
and our auditor’s report thereon. We have obtained the
report of the Board of Directors prior to the date of this
auditor’s report, and the Annual Report is expected to be
made available to us after that date.
Our opinion on the financial statements does not cover
the other information.
In connection with our audit of the financial statements,
our responsibility is to read the other information
identified above and, in doing so, consider whether the
other information is materially inconsistent with the
financial statements or our knowledge obtained in the
audit, or otherwise appears to be materially misstated.
With respect to report of the Board of Directors, our
responsibility also includes considering whether the
report of the Board of Directors has been prepared in
accordance with the applicable laws and regulations.
In our opinion, the information in the report of the Board
of Directors is consistent with the information in the
financial statements and the report of the Board of
Directors has been prepared in accordance with the
applicable laws and regulations.
If, based on the work we have performed on the other
information that we obtained prior to the date of this
auditor’s report, we conclude that there is a material
misstatement of this other information, we are required
to report that fact. We have nothing to report in this
regard.
Helsinki, 15 February 2024
Ernst & Young Oy
Authorized Public Accountant Firm
Antti Suominen
Authorized Public Accountant
92
Financial statementsFinancial review Financial Review 2023
