Year-End Report 2012

• Pandox' cash flow from current operations, including 50 percent of the profits in Norgani, decreased to SEK 664.5 million (691.2), representing a decrease by 3.9 percent. The reduction is mainly due to lower revenues as a consequence of extensive capacity withdrawal in accordance with the investment plans, as well as higher financial expenses.
• Property management revenues amounted to SEK 960.6 million (961.4). For comparable entities, including an adjustment for currency effects, the property management revenues were almost unchanged from the previous year.
• Revenues from Pandox' own operations were SEK 1,156.0 million (1,244.0), representing a decrease of 7 percent for comparable units and adjusted for currency effects. Most of the deviation is attributable to capacity withdrawal in conjunction with planned investments.
• Profit before tax, excluding non-recurring items, including Pandox share in Norgani, amounted to SEK 435.2 million (457.5).
• Pandox manages a hotel property portfolio consisting of 120 hotels and one congress and fair centre with 24,800 rooms. There are operations in ten countries, at 59 locations, under 19 different brands. Ownership of the portfolio is spread, whereby Pandox fully owns 47 hotels. The remaining hotel properties are owned in equal proportions, together with the company's shareholders, except for one hotel that is managed by Pandox, but owned by one of the shareholders. The figures in this year-end report include the hotels that are fully -owned by Pandox, as well as Pandox’ share of the results in the other hotels, in accordance with the equity method.

Several positive cyclical signals emerged in the USA in 2012, when signs of improvement in the residential housing market could be glimpsed, and the households' indebtedness fell strongly. The US economy still has some way to go before reaching normal levels, as shown by persistently high unemployment levels, for the USA, of around 8 percent, and estimated weak GDP for the fourth quarter.

The euro area was still in recession in 2012. It is assessed that the weak economic development will continue in 2013, although several macro-economic analysts expect the development to change course later in the year. The financial markets' confidence in how the euro crisis is handled by governments and institutions is still a vital parameter determining Europe's economic development.

The Nordic countries, with the exception of Norway, are still in a period of weak growth. Rising unemployment, weak exports and household spending restraint are dampening growth prospects, even though some analysts believe in a stronger economy in the second half of 2013. Denmark currently shows the weakest development among the Nordic countries. With high demand in the oil industry, low interest rates and low unemployment, Norway continues to buck the international economic trends.

Overall, the global cyclical position is considered to have stabilised to a degree, yet major political challenges still remain.

For further information, please contact: