Hufvudstaden

Quarterly Report • Aug 24, 2023

Q2 Half-year Report January-June 2023

Half-year Report January-June 2023

• Net revenue from property management was SEK 1,004 million (905), an increase of 11 per cent. Including intra-Group rent revenue, net revenue from property management was 1,101 million (1,006).
• Gross profit from property management increased by 13 per cent, totalling SEK 675 million (599). Including intra-Group rent revenue, gross profit from property management was SEK 771 million (700).
• Net result for the period was SEK -1,372 million (756), equivalent to SEK -6.78 per share (3.74). The decrease can be attributed primarily to negative unrealised changes in the value of the property holdings.
• The fair value of the property holdings was SEK 47.8 billion (49.5 at year-end), resulting in a net reinstatement value (EPRA NRV) of SEK 189 per share (201 at year-end). Unrealised changes in the value of the property holdings amounted to SEK -2,295 million (410) for the period.
• The equity ratio was 59 per cent (61), the net loan-to-value ratio was 21 per cent (18) and the interest coverage ratio was 5.6 (8.1).
• The rental vacancy rate at the end of the period was 7.7 per cent (8.5). Excluding current development projects, the rental vacancy level was 4.5 per cent (5.5).

The Kvasten 2, 6 and 9 properties in Stockholm have been environmentally certified under BREEAM In-Use with the rating of Very Good. With that, 76 per cent of Hufvudstaden's properties are environmentally certified. The objective is to obtain environmental certification for all properties by 2025 at the latest.

At the Packarhuset 4 property, the best location by Norrmalmstorg, Danske Bank has extended its lease for an office of approximately 9,800 square metres until 2035.

At the Fyran property in Gothenburg, Rolfs Flyg- och Bussresor has signed a lease for an office of approximately 1,500 square metres.

In Nordstan, Flying Tiger is opening a 150 square metres store in Fyran and the jewellery brand Pandora is establishing a store of 60 square metres in the Femman shopping centre.

Operating events during the second quarter

In Bibliotekstan, the fashion house Moncler is expanding its leased space at the Pumpstocken 10 property by approximately 200 square metres, and Prada Uomo is opening a shop of approximately 80 square metres at the Rännilen 18 property.

The Swedish shoe and accessory brand ATP Atelier has signed a lease for a shop of approximately 80 square metres, to open at the end of the year, at the Vildmannen 7 property in Bibliotekstan.

The Spanish tapas restaurant Chipirón will be opening on the women's clothing floor of the NK department store in Stockholm, further strengthening the department store's food selection.

Performance measures
	Jan-Jun	Jan-Jun	Jan-Dec
SEK m	2023	2022	2022
Net revenue, property management, gross	1,101	1,006	2,055
Rent revenue, intra-Group	-97	-101	-200
Net revenue, property management, net	1,004	905	1,855
Gross profit, property management	675	599	1,235
Unrealised changes in property value, investment properties	-2,295	410	-209
Operating profit	-1,606	1,035	1,089
Net profit for the period	-1,372	756	722
Fair value of properties, SEK bn	47.8	49.6	49.5
Net loan-to-value ratio, properties, %	20.6	18.5	18.7
Interest coverage ratio, multiple	5.6	8.1	7.7
EPRA vacancy rate, %	4.5	5.5	4.0
EPRA EPS, SEK	2.62	2.48	5.07
EPRA NRV per share, SEK	189	201	201

GROUP

RESULTS

Property management

Net revenue from property management excluding intra-Group rents of SEK 96.6 million (100.6) totalled SEK 1,003.9 million (905.4) for the period. The increase was attributable primarily to indexation as well as higher gross rents in conjunction with new leases and renegotiations. Since early 2022, net revenue was charged with costs for vacant premises attributable to the entire Inom Vallgraven 12 block in Gothenburg being emptied for the Johanna project. Operating expenses amounted to SEK -329.1 million (-306.5). Operating costs increased during the period, mainly related to higher energy costs. Gross profit was SEK 674.8 million (598.9) excluding intra-Group rents.

The sales-based rent supplement is reported in the fourth quarter. The sales-based rent supplement for the preceding year totalled SEK 12.0 million, of which the NK properties accounted for SEK 9.9 million. Apart from the sales-based rent supplement, there are no other material seasonal variations in rents.

The property management results for each business area are reported on page 9.

Other segments

Other segments comprise NK Retail and other operations. Other operations consist of Cecil Coworking, NK e-commerce and the parking business in Parkaden.

Net revenue for NK Retail amounted to SEK 368.6 million (358.5). Costs excluding intra-Group rents of SEK -58.6 million (-67.3) were SEK -353.6 million (-334.1). Gross profit for NK Retail excluding intra-Group rental costs was SEK 15.0 million (24.4). Sales for NK Retail are impacted by seasonal variations, with the first quarter of the year normally being the weakest and the fourth quarter the strongest.

Net revenue for other operations amounted to SEK 68.6 million (64.3). Costs excluding intra-Group rents of SEK -38.0 million (-33.3) were SEK -43.7 million (-36.6). Gross profit excluding intra-Group rental costs was SEK 24.9 million (27.7).

For further information, see Segment Reporting on page 9.

Other profit and loss items

Central administration totalled SEK -25.6 million (-25.5). Unrealised changes in value in investment properties totalled SEK -2,295.0 million (409.6). For further information, see pages 4–5.

Financial income and expense

Net financial income and expense totalled SEK -118.8 million (-81.7). Interest income was SEK 4.5 million (0.0). Borrowing costs totalled SEK -111.7 million (-70.4), of which fees for withdrawal of mortgage deeds comprised SEK 0.0 million (-5.1). Interest expenses for leasing, primarily ground rents, totalled SEK -11.6 million (-11.3). The increase in financial expenses for borrowing was largely attributable to a higher average interest rate. For further information, see pages 5–6.

Tax

The Group's tax for the period was SEK 352.2 million (-197.3), of which SEK -38.9 million (-42.3) in current tax and SEK 391.1 million (-155.0) in deferred tax. The change in deferred tax can be attributed to the period's negative unrealised changes in the value of the property holdings.

Net profit or loss for the period

The consolidated net result was SEK -1,372.5 million (756.1). The decrease can be attributed to the period's negative unrealised changes in the value of the property holdings.

PROPERTY HOLDINGS

The fair value of the Hufvudstaden property holdings is based on an internal valuation, where classification takes place on level 3 according to IFRS 13. The assessed value as at June 30, 2023 was SEK 47,837 million (49,547 at year-end). The decrease can be attributed to negative unrealised changes in value in the property holdings but was partially offset by investments during the period. Rentable floor space totalled approximately 386,100 square metres (386,600 at year-end).

The total rental vacancy rate as of June 30, 2023 was 7.7 per cent (7.0 at year-end) and the total floor space vacancy rate was 12.2 per cent (11.2 at yearend). The rental vacancy rate, excluding current development projects (EPRA vacancy rate), totalled 4.5 per cent (4.0 at year-end).

Acquisitions and investments

Total investments amounted to SEK 617.0 million (458.9).

At present, current and planned projects are worth approximately SEK 3 billion. Major projects are presented in the table below.

The reconstruction of Vildmannen 7 in Bibliotekstan is mostly completed. Startup of installations and systems have been carried out. The final work on the inner courtyard and surrounding street environment is finished. The remaining activities includes part of the work in the retail premises. All office spaces of approximately 2,900 square metres have been leased to Cirio Law Firm, with access during the third quarter. Several leases for retail spaces have been signed. Chanel Fragrance and Beauty Boutique and A.P.C. will each lease around 100 square metres, and ATP Atelier will lease around 80 square metres. The new building offers highly modern and efficient offices as well as attractive stores in a unique environment.

In the Hästhuvudet 13 property, at the Sveavägen and Kungsgatan intersection in Stockholm, a major redevelopment of approximately 3,100 square metres of office space and upgrade of technical installations is in progress.

The extensive redevelopment and expansion of the Johanna project continues at the Inom Vallgraven 12 block in Gothenburg. During the quarter, work with sheet piling, foundation and frame as well as façades and new window openings was carried out. The new frame has partially achieved full construction height and part of the block has been weatherproofed. The first of two cranes was erected in the block. The project comprises a total of approximately 44,000 square metres gross area and rentable floor space is expected to increase by approximately 11,600 square metres. Completion is expected to be in late 2025 or early 2026.

At the end of each quarter, Hufvudstaden carries out an internal valuation of each individual property. The purpose of the valuation is to assess the fair value of the property holdings. To assure the quality of the valuation, external valuations of parts of the property holdings are obtained at least once a year. A continuous update is made during the year of the internal valuation of the properties in order to take account of purchases, sales and investments. Hufvudstaden also examines on a continuous basis whether there are other indications of changes in the fair value of the properties. These indications could take the form, for example, of major leases, terminations, and material changes in the yield requirements.

In the light of the above, the unrealised change in value of the property holdings for the period was SEK -2,295.0 million (409.6). The total value of the property holdings on June 30, 2023 was SEK 47.8 billion, including investments made during the period. The unrealised decrease in value was primarily due to increasing yield requirements, but was offset to some extent by the effect of higher rents.

The average yield requirement increased 15 basis points compared to the first quarter of 2023 and stood at 3.9 per cent at the above valuation (3.7 at year-end).

Valuation method

Valuation of the property holdings is carried out by assessing the fair value of each individual property. The valuation is made using a variation of the location price method, known as the net capitalisation method. The method means that the market yield requirements are put in relation to the net operating income of the properties. In the case of other project properties and undeveloped land, the valuation is based on a completed building with a deduction of construction costs, as well as financial expenses and the cost of vacant space that arose during the construction period.

The yield requirement is based on information compiled about the market's yield requirement for actual purchases and sales of comparable properties in similar locations. If few or no deals have been concluded in the property's sub-area, transactions in the adjoining area are analysed. Even transactions that have yet to be finalised or other impacting factors provide guidance on market yield requirements.

The yield requirement can vary between different regions and different sub-areas within the regions. Account is also taken of the type of property, the technical standard, the construction of the building, and major investment requirements. For leasehold properties, the calculation is based on a yield requirement that is 0.20 percentage points higher than for equivalent properties where the land is freehold. The net operating income of the properties is based on market rent revenue, the long-term rental vacancy rate, and normalised operating and maintenance costs.

Major current and planned projects in the second quarter 2023
---------------------------------------------------------------

				Project floor space	Of which added	Estimated	Estimated
				(sq m)	floor space	investment1)	completion
City	Property	Status	Type of premises		(sq m)	(SEK m)	(year)
Stockholm	Vildmannen 7	Current	Office, retail &	4,800	4,800	800	2023
			residential
Stockholm	Hästhuvudet 13	Current	Office	3,100	-	135	2023/2024
Stockholm	Orgelpipan 7	Local planning	Office	-	-	-	-
Gothenburg	Inom Vallgraven	Current	Office, retail &	31,600	11,600	2,200	2025/2026
	12 block		restaurant
Gothenburg	NK Gothenburg	Local planning	Office, retail &	-	-	-	-
			restaurant

1) Includes estimated costs for rent losses and financing that are continuously recognised in profit and loss as well as costs for evacuation. The investment in the Vildmannen 7 property includes extraordinary costs resulting from the fire in 2017.

Property value and net asset value

Half-year Report January-June 2023 Hufvudstaden 4

If there is greater uncertainty than normal, this is offset by the increased direct yield requirements in the valuation.

When carrying out the valuation, the following yield requirement figures for office and retail properties have been applied:

Yield requirements, property valuation1)

Stockholm	3.5-4.0 per cent
Gothenburg	4.5-4.7 per cent
Property holdings, average	3.9 per cent

1) Valuation date: June 30, 2023.

Sensitivity analysis

Fair value is an assessment of the probable sales price on the market at the time of valuation. However, the price can only be set when a transaction has been completed. In the case of an external property valuation, a range is often given to indicate the degree of uncertainty surrounding the estimates of fair value. The value range is usually +/– 5 per cent but can vary depending, among other things, on the market situation, the technical standard of the property, and investment requirements.

Hufvudstaden's property holdings are valued at SEK 47.8 billion, with a degree of uncertainty of +/- 5 per cent, would mean that the estimated fair value varies by +/- SEK 2.4 billion. Below are the key factors that influence the valuation and the consequent impact on profit or loss before tax.

Sensitivity analysis, property valuation1)

	Change, +/-	Impact on profit
		or loss before
		tax, +/-
Rental revenue	SEK 100/sq m	SEK 1,020 m
Property costs	SEK 50/sq m	SEK 510 m
Rental vacancy rate	1.0 percentage points	SEK 650 m
Yield requirement	0.25 percentage points	SEK 3,140 m

1)Valuation date: June 30, 2023.

External valuation

To assure the quality of the valuation, external estimates were obtained from three independent valuation companies: Cushman & Wakefield, Forum Fastighetsekonomi, and Newsec Advice. The external valuation as at June 30, 2023 encompassed ten properties, equivalent to 33 per cent of the internally assessed fair value. The corresponding proportion at year-end was 43 per cent. The basis for selection was that the properties should represent variations in property category, town, location, technical standard, and construction standard. The properties that underwent an external valuation as at June 30, 2023 were Grönlandet Södra 11, Järnplåten 28, Kvasten 6, Medusa 1, Orgelpipan 7, Oxhuvudet 18, Pumpstocken 10 (part of) and Rännilen 18 in Stockholm, and Inom Vallgraven 10:9 (NK Gothenburg) and Nordstaden 8:24 (part of) in Gothenburg.

The external valuation companies set a fair value for these properties of SEK 16.6 billion. Hufvudstaden's internal valuation of the same properties was SEK 16.0 billion. The internal valuations thus concur well with the external valuations.

Net asset value

Based on the valuation of the property holdings, the long-term net asset value (EPRA NRV) was SEK 38.3 billion or SEK 189 per share. Net tangible assets (EPRA NTA) were SEK 36.1 billion or SEK 178 per share following a deduction of estimated actual deferred tax liabilities. This assessment is made in the light of current tax legislation, which means that properties can be sold via a limited company without tax implications. The estimated actual deferred tax has been assumed to be 5 per cent.

Net asset value, June 30, 2023

		SEK m SEK/share
Equity	29,343.3	145
Reversal
Recognised deferred tax1)	8,981.4	44
EPRA NRV	38,324.7	189
Deduction
Intangible assets	-94.5	0
Estimated actual deferred tax 5%	-2,179.9	-11
EPRA NTA	36,050.3	178
Reversal
Intangible assets as above	94.5	0
Recognised deferred tax1) less
estimated actual deferred tax	-6,801.4	-33
EPRA NDV	29,343.3	145

1) Deferred tax according to the balance sheet related to investment properties and right-of-use assets attributable to ground rents.

RENTAL MARKET

Performance in Stockholm City office rental market was stable during the second quarter, but the letting process took somewhat longer. The demand was mainly for modern and flexible office premises in the best locations. Vacancy levels remained within the normal range and in Stockholm's most attractive locations – Bibliotekstan, Norrmalmstorg/Hamngatan, and the Hötorget area – market rents for modern offices were estimated at SEK 6,800–9,400 per square metre and year, excluding the property tax supplement. Market demand for retail premises was stable and several leases were signed. The market rents for retail premises in prime commercial locations were in the range of SEK 11,000–24,000 per square metre and year, excluding the property tax supplement.

In the central sub-markets of Gothenburg, the demand was mainly for modern and flexible office premises. Vacancies were higher than the normal range and market rents in the most attractive locations were between SEK 3,200–4,000 per square metre and year, excluding the property tax supplement. For retail premises in central commercial locations, market rents were between SEK 3,000–13,000 per square metre and year, excluding the property tax supplement.

The outcome from the Group's renegotiations was positive for office premises and negative for retail premises. During the period, a total of 40,700 square metres were renegotiated at a rental value of SEK 294 million. On average, the renegotiations result in an increase in rent of approximately 1 per cent. The renegotiation with Danske Bank in the Packarhuset 4 property will have an effect only from the end of 2025 and is not included in the above figures.

FINANCING

Hufvudstaden's financing requirements are met through a number of the major Nordic banks and the capital market. Total borrowings as at June 30, 2023 amounted to SEK 9,700 million (9,000 at year-end). Interest-bearing net debt was SEK 9,157 million (8,547 at year-end). In addition, the lease liability according to IFRS 16 amounted to SEK 712 million (712 at year-end), and total net debt was SEK 9,869 million (9,259 at year-end). In addition to outstanding loans, there are unutilised loan commitments amounting to SEK 5,000 million.

Hufvudstaden has an MTN programme totalling SEK 12,000 million, and a commercial paper programme amounting to SEK 3,000 million. The outstanding amount in bonds was SEK 6,300 million and there was SEK 900 million in commercial paper. Hufvudstaden ensures that at any point in time there are unutilised loan assurances to cover all outstanding commercial paper.

As of June 30, 2023, cash and cash equivalents and unutilised loan commitments amounted to SEK 5,543 million, which covers all bond and commercial paper maturities for the next three years.

Financing facilities, SEK m, June 30, 2023

Loan/facility type	Framework/	Unutilised
	facility volume
MTN programme	12,000	5,700
Comm. paper programme	3,000	2,100
Bank loans and commitments	7,500	5,000

The average fixed interest period was 1.3 years

(1.7 at year-end), the average capital tie-up period was 2.4 years (2.6 at year-end), and the average effective rate of interest was 2.9 per cent (1.9 at year-end) including, and 2.8 per cent (1.7 at year-end) excluding, the cost of unutilised loan commitments. The capital tie-up period for commercial paper loans was calculated based on the underlying loan commitments. To achieve the desired interest payment structure, borrowing takes place at both a fixed and variable rate of interest. Of the longterm borrowings, SEK 4,500 million carries a fixed rate of interest. Financial assets and liabilities are recognised at amortised cost, which essentially concurs with fair value, apart from the bond loans. For bond loans with a fixed rate of interest, the surplus value is SEK 365.0 million (397.3 at year-end). These values have been calculated according to level 2 in IFRS 13, i.e. the value has been calculated based on official market listings.

Fixed interest structure, June 30, 2023

Credit	AER,	Proportion,
amount,	%1), 2)	%
SEK m
5,200	4.3	54
1,500	1.1	16
1,500	1.2	15
1,500	1.6	15
9,700	2.9	100

1) The cost for unutilised loan commitments is allocated in the table in the period in which the credit matures.

2) The average effective rate excluding cost for unutilised loan commitments was 2.8 per cent.

Capital tie-up structure, SEK m, June 30, 2023

Maturity,	Bank	Bonds/	Total	Unutilised
year	loans	Comm.paper	liabilities	commitments
< 1	500	1,900	2,400	1,000
1 - 2	1,000	2,300	3,300	1,000
2 - 3	-	1,500	1,500	1,000
3 - 4	-	1,500	1,500	1,000
4 - 5	1,000	-	1,000	1,000
Total	2,500	7,200	9,700	5,000

Green financing

The aim of green financing is to finance green properties and investments in projects promoting climate transition and sustainability. Hufvudstaden has a total of SEK 4.3 billion in green financing, corresponding to 44 per cent of total borrowing. Green bonds are issued in accordance with Hufvudstaden's framework, which complies with the Green Bond Principles. The frameworks of the issuing institutions are complied with when taking up green bank loans. Of the total green financing, bonds amounted to SEK 2.3 billion and bank loans amounted to SEK 2.0 billion. The goal is to gradually increase the share of green financing.

SECOND QUARTER

Net revenue from property management excluding intra-Group rents of SEK 48.1 million (50.3) totalled SEK 501.0 million (456.7), an increase of 10 per cent. The increase was attributable primarily to indexation as well as higher gross rents in conjunction with renegotiations and new leases. Operating expenses amounted to SEK -156.9 million (-145.8), associated

primarily with increased operating and maintenance costs. Gross profit from property management excluding intra-Group rents of SEK 48.1 million (50.3) totalled SEK 344.1 million (310.9).

Net revenue for NK Retail amounted to SEK 191.1 million (194.4). Costs excluding intra-Group rents of SEK -29.1 million (-33.6) were SEK -176.3 million (-171.2). Gross profit for NK Retail excluding intra-Group rental costs was SEK 14.8 million (23.2).

Net revenue for other operations amounted to SEK 34.3 million (33.3). Costs excluding intra-Group rents of SEK -19.0 million (-16.7) were SEK -22.8 million (-19.5). Gross profit excluding intra-Group rental costs was SEK 11.5 million (13.8).

Changes in value of investment properties amounted to SEK -1,388.6 million (182.6). Net financial income and expense totalled SEK -66.6 million (-43.7), of which fees for withdrawal of mortgage deeds were SEK 0.0 million (-5.1).

SHARES AND SHAREHOLDERS

Hufvudstaden Class A shares are listed on Nasdaq Stockholm. The company's Class C shares were delisted from Nasdaq Stockholm in January 2020. The company had 34,223 shareholders at the end of the period. The proportion of foreign ownership as of June 30, 2023 was 20.7 per cent (21.0 at year-end) of the total number of outstanding shares. The Class A share price as of June 30, 2023 was SEK 128.10, and total market capitalisation of all shares based on the Class A share price was SEK 27.1 billion.

Largest shareholders, June 30, 2023

Shareholder	Number of	Number of
	shares, %	votes, %
L E Lundbergföretagen	45.2	87.9
AMF	9.3	1.9
State Street Bank and Trust	3.7	0.8
BNY Mellon	2.6	0.5
JP Morgan Chase Bank	2.3	0.5
BNP Paribas, Luxembourg	1.4	0.3
BNP Paribas, Paris	1.3	0.3
Spiltan Funds	1.2	0.2
Norges Bank	1.0	0.2
Lundberg family	1.0	0.8
Skogstornet	1.0	0.2
Other shareholders	25.8	5.5
Shares outstanding	95.8	99.1
Company holdings	4.2	0.9
Total number of issued shares	100.0	100.0

Conversion of Hufvudstaden's Class C shares

At the 2001 Annual General Meeting, a conversion clause was added to Hufvudstaden's Articles of Association. Shareholders have the right at any time to request conversion of Class C shares into Class A shares. In the first half of 2023, 1,097 Class C shares were converted into Class A shares.

Share structure as of June 30, 2023

	Number of	Number of	Equity	Votes
Share class	shares	votes	%	%
A (1 vote)	203,001,207	203,001,207	96.1	19.7
C (100 votes)	8,270,726	827,072,600	3.9	80.3
Total		211,271,933 1,030,073,807	100.0	100.0

Shares bought back

Treasury shares held on June 30, 2023 totalled 8,965,000 Class A shares, corresponding to 4.2 per cent of all shares issued and 0.9 per cent of the total number of votes. No buyback took place during the period or after the end of the reporting period. At the 2023 Annual General Meeting, the Board of Directors was granted renewed authorisation to acquire Class A shares up to 10 per cent of all issued shares and to transfer treasury shares held by the company.

Share buybacks as of June 30, 2023

			Other
	Total number	Treasury	share
Million shares	of shares	shares	holders
As of January 1, 2023	211.3	9.0	202.3
Buyback	-	-	-
As of June 30, 2023	211.3	9.0	202.3

MATERIAL RISKS AND UNCERTAINTIES

The Group is mainly exposed to financing, interest and credit risks and changes in the value of its property holdings.

The geopolitical security situation in Europe has deteriorated sharply due to the war in Ukraine following Russia's invasion. This has resulted in negative effects on the financial markets. The impact on the energy market was also large, with periodically significantly higher prices. Inflation remains high, and to offset this several central banks have continued to gradually raise policy rates. On August 17, the Swedish Security Service raised the terrorist threat level to 4 on a five-level scale, which means that the threat level in and against Sweden is assessed as high. Hufvudstaden is monitoring these developments and follows the recommendations and advice provided by the authorities.

Other than the above, no other material risks or uncertainties have been identified apart from those described in the Annual and Sustainability Report 2022.

MATERIAL TRANSACTIONS WITH RELATED PARTIES

No material transactions with related parties took place during the period.

ACCOUNTING POLICIES

Hufvudstaden applies the EU-endorsed IFRS standards. This interim report for the Group has been prepared in accordance with IAS 34 Interim Financial Reporting, and applicable provisions of the Swedish Annual Accounts Act. Disclosures according to IAS 34.16A are presented in both the financial statements and in other parts of the interim report. Accounting policies and computation bases remained unchanged from the most recent Annual and Sustainability Report.

New standards and interpretations

New and amended standards that took effect in 2023 have not had any significant effects on the Group's financial reporting.

FORTHCOMING INFORMATION

Interim Report January-September 2023 November 9, 2023 Year-end Report 2023 February 15, 2024 Annual and Sustainability Report 2023 February 2024 Annual General Meeting 2024 March 21, 2024

The information in this Interim Report is information that Hufvudstaden AB (publ) is obligated to publish under the EU Market Abuse Regulation and the Securities Market Act. The information was published through the auspices of the persons named below on August 24, 2023.

This information is also published on Hufvudstaden's website, www.hufvudstaden.se/en/

Questions can be answered by Anders Nygren, President, and Åsa Roslund, Vice President and CFO, on telephone +46 8 762 90 00.

REPORT ON RESULTS - SUMMARY

	April	April	January	January	January
GROUP, SEK m	June 2023	June 2022	June 2023	June 2022	December 2022
Net revenue1)
Property management, gross	549.1	507.0	1,100.5	1,006.0	2,054.7
Rent revenue, intra-Group	-48.1	-50.3	-96.6	-100.6	-199.8
Property management, net	501.0	456.7	1,003.9	905.4	1,854.9
Other segments	225.4	227.7	437.2	422.8	890.9
	726.4	684.4	1,441.1	1,328.2	2,745.8
Property management expenses
Maintenance	-9.1	-4.9	-22.4	-16.4	-32.1
Operation and administration	-87.0	-82.0	-185.0	-167.7	-355.0
Property tax	-59.2	-57.4	-118.5	-119.4	-227.0
Depreciation	-1.6	-1.5	-3.2	-3.0	-5.9
Property management expenses	-156.9	-145.8	-329.1	-306.5	-620.0
Other segments, gross expenses	-247.2	-241.0	-493.9	-471.3	-972.0
Rental expenses, intra-Group	48.1	50.3	96.6	100.6	199.8
Other segments, net expenses	-199.1	-190.7	-397.3	-370.7	-772.2
Operating expenses	-356.0	-336.5	-726.4	-677.2	-1,392.2
Gross profit	370.4	347.9	714.7	651.0	1,353.6
- of which Property management	344.1	310.9	674.8	598.9	1,234.9
- of which Other segments	26.3	37.0	39.9	52.1	118.7
Central administration	-12.6	-12.7	-25.6	-25.5	-55.7
Operating profit before changes in value	357.8	335.2	689.1	625.5	1,297.9
Changes in value, investment properties	-1,388.6	182.6	-2,295.0	409.6	-209.1
Operating profit or loss	-1,030.8	517.8	-1,605.9	1,035.1	1,088.8
Financial income and expense	-66.6	-43.7	-118.8	-81.7	-184.5
Profit or loss before tax	-1,097.4	474.1	-1,724.7	953.4	904.3
Tax	224.3	-98.0	352.2	-197.3	-182.3
Net profit or loss	-873.1	376.1	-1,372.5	756.1	722.0
Other comprehensive income	-	-	-	-	-
Total comprehensive income or loss for the	-873.1	376.1	-1,372.5	756.1	722.0
period
Average number of outstanding shares	202,306,933	202,306,933	202,306,933	202,306,933	202,306,933
Net earnings for the period per share before and
after dilution, SEK 1) For a breakdown of net revenue, see table on page 10.	-4.31	1.86	-6.78	3.74	3.57

REPORT ON FINANCIAL POSITION - SUMMARY

	June 30,	June 30,	December 31,
GROUP, SEK m	2023	2022	2022
Investment properties	47,836.9	49,629.7	49,546.9
Right of use assets	711.0	711.3	711.0
Other non-current assets	174.7	158.6	165.4
Total non-current assets	48,722.6	50,499.6	50,423.3
Current assets	977.1	1,019.4	812.1
Total assets	49,699.7	51,519.0	51,235.4
Equity	29,343.3	31,296.1	31,262.0
Non-current interest-bearing liabilities	7,300.0	6,500.0	6,500.0
Deferred tax liabilities	8,862.1	9,317.1	9,253.2
Non-current leasing liabilities	704.1	703.6	702.8
Other non-current liabilities	97.6	99.8	104.0
Other provisions	28.7	29.5	31.7
Total non-current liabilities	16,992.5	16,650.0	16,591.7
Current interest-bearing liabilities	2,400.0	2,600.0	2,500.0
Current leasing liabilities	7.8	8.5	9.0
Other liabilities	956.1	964.4	872.7
Total current liabilities	3,363.9	3,572.9	3,381.7
Total equity and liabilities	49,699.7	51,519.0	51,235.4

REPORT ON CHANGES IN EQUITY - SUMMARY

	January June	January June	January December
GROUP, SEK m	2023	2022	2022
Equity, opening balance	31,262.0	31,066.0	31,066.0
Total comprehensive income or loss for the period	-1,372.5	756.1	722.0
Dividend	-546.2	-526.0	-526.0
Equity, closing balance	29,343.3	31,296.1	31,262.0

REPORT ON CASH FLOWS - SUMMARY

GROUP, SEK m	January June 2023	January June 2022	January December 2022
	-1,724.7	953.4	904.3
Income before tax
Depreciation/impairments Changes in value, investment properties	32.3 2,295.0	32.6 -409.6	53.4 209.1
Other changes	-3.0	-2.5	-0.4
Income tax paid	-38.9	-42.3	-91.2
Cash flow from current operations	560.7	531.6	1,075.2
before changes in working capital
Increase/decrease in inventory	-3.1	-9.4	-69.9
Increase/decrease in operating receivables	-76.4	-119.3	-35.2
Increase/decrease in operating liabilities	77.0	141.7	54.2
Cash flow from current operations	558.2	544.6	1,024.3
Investments in properties	-585.1	-430.5	-966.3
Investments in other non-current assets	-31.9	-28.4	-51.5
Cash flow from investments	-617.0	-458.9	-1,017.8
Loans raised	3,200.0	1,300.0	2,800.0
Amortisation of loan debt	-2,500.0	-1,400.0	-3,000.0
Amortisation of leasing debt	-4.9	-4.8	-9.5
Dividend paid	-546.2	-526.0	-526.0
Cash flow from financing	148.9	-630.8	-735.5
Cash flow for the period	90.1	-545.1	-729.0
Cash and cash equivalents at the beginning of the period	453.0	1,182.0	1,182.0
Cash and cash equivalents at the period-end	543.1	636.9	453.0
Cash flow from current operations per share, SEK	2.76	2.69	5.06
Cash flow for the period per share, SEK	0.45	-2.69	-3.60

SEGMENT REPORT - SUMMARY

The Group's operations are divided into three segments, property management, NK Retail and other operations. Other operations comprise of Cecil Coworking (Business Area Stockholm) and NK e-commerce and the parking business in Parkaden (Business Area NK). The segments are divided into the business areas, which are in line with the Company's operational control system.

	Business Area Business Area			Business Area Intra-Group
	Stockholm		NK		Gothenburg		elimination		Total
	Jan-Jun	Jan-Jun	Jan-Jun	Jan-Jun	Jan-Jun		Jan-Jun Jan-Jun	Jan-Jun	Jan-Jun	Jan-Jun
GROUP, SEK m	2023	2022	2023	2022	2023	2022	2023	2022	2023	2022
Property management
Net revenue	696.1	625.9	240.5	233.6	163.9	146.5	-96.6	-100.6	1,003.9	905.4
Property management expenses	-152.9	-144.4	-122.1	-110.5	-54.1	-51.6			-329.1	-306.5
Gross profit property	543.2	481.5	118.4	123.1	109.8	94.9	-96.6	-100.6	674.8	598.9
management
NK Retail
Net revenue			368.6	358.5					368.6	358.5
Expenses			-412.2	-401.4			58.6	67.3	-353.6	-334.1
Gross profit NK Retail			-43.6	-42.9			58.6	67.3	15.0	24.4
Other operations
Net revenue	22.6	20.1	46.0	44.2					68.6	64.3
Expenses	-21.3	-17.3	-60.4	-52.6			38.0	33.3	-43.7	-36.6
Gross profit other operations	1.3	2.8	-14.4	-8.4			38.0	33.3	24.9	27.7
Central administration									-25.6	-25.5
Changes in value,
investment properties									-2,295.0	409.6
Operating profit or loss									-1,605.9	1,035.1
Financial income and
expense									-118.8	-81.7
Profit or loss before tax									-1,724.7	953.4

BREAKDOWN OF NET REVENUE

	Group			Parent Company
	Jan-Jun	Jan-Jun	Jan-Dec	Jan-Jun	Jan-Jun	Jan-Dec
SEK m	2023	2022	2022	2023	2022	2022
Rent revenue	1,013.7	914.9	1,870.8	760.3	683.8	1,397.2
Service revenue	58.8	54.8	114.8	26.8	22.5	47.2
Sale of goods	368.6	358.5	760.2	-	-	-
Total net revenue	1,441.1	1,328.2	2,745.8	787.1	706.3	1,444.4

PERFORMANCE MEASURES

GROUP	June 30, 2023	June 30, 2022	Full year 2022
Property-related
Rentable floor space, 1,000 m2	386.1	386.6	386.6
Rental vacancy rate, %	7.7	8.5	7.0
Floor space vacancy rate, %	12.2	13.4	11.2
Fair value, SEK bn	47.8	49.6	49.5
Surplus ratio, %	70.1	69.5	69.8
Net operating income, SEK m	771.4	699.5	1,434.7
Financial
Return on equity, %	-3.0	3.8	2.3
Return on capital employed, %	-2.2	4.0	2.6
Equity ratio, %	59	61	61
Interest coverage ratio, multiple	5.6	8.1	7.7
Debt/equity ratio, multiple	0.3	0.3	0.3
Net loan-to-value ratio, properties, %	20.6	18.5	18.7
Gross margin, %	49.6	49.0	49.3
Data per share
Net earnings per share for the period, SEK	-6.78	3.74	3.57
Equity, SEK	145.04	154.70	154.53
Properties, fair value, SEK	236.46	245.32	244.91
Number of outstanding shares, 1,000	202,307	202,307	202,307
Average number of outstanding shares, 1,000	202,307	202,307	202,307
Number of issued shares, 1,000	211,272	211,272	211,272
EPRA
EPRA Earnings (Earnings from property mgmt. after nom. tax), SEK m	531	501	1,025
EPRA EPS, SEK	2.62	2.48	5.07
EPRA NRV (Net reinstatement value), SEK m	38,324.7	40,729.0	40,635.1
EPRA NRV per share, SEK	189	201	201
EPRA NTA (Net tangible assets), SEK m	36,050.3	38,348.4	38,270.8
EPRA NTA per share, SEK	178	190	189
EPRA NDV (Net disposal value), SEK m	29,343.3	31,296.1	31,262.0
EPRA NDV per share, SEK	145	155	155
EPRA vacancy rate, %	4.5	5.5	4.0

PERFORMANCE MEASURES PER QUARTER

	Apr-Jun	Jan-Mar	Oct-Dec	Jul-Sep	Apr-Jun	Jan-Mar	Oct-Dec	Jul-Sep
GROUP	2023	2023	2022	2022	2022	2022	2021	2021
Share price, series A share, SEK	128.10	140.70	148.30	122.30	113.00	133.80	135.20	131.10
Net revenue, SEK m	726	715	746	672	684	644	703	632
Return on equity, %	-3.0	0.5	2.4	4.2	4.0	3.1	9.8	5.3
Return on equity, adjusted %	3.0	2.8	2.9	2.9	2.9	2.6	3.0	3.3
Equity ratio, %	59	60	61	61	61	60	61	60
Gross margin, %	51.0	48.2	48.1	51.2	50.8	47.1	48.7	55.0
Surplus ratio, %	71.4	68.8	68.6	71.7	71.2	67.8	68.2	73.5
Net operating income, SEK m	392.2	379.2	370.3	364.9	361.2	338.3	333.3	363.2
Net profit or loss per share for the
period, SEK	-4.31	-2.47	-1.63	1.46	1.86	1.88	8.33	2.48
Equity per share, SEK	145.04	149.36	154.53	156.16	154.70	152.84	153.56	145.23
EPRA EPS, SEK	1.37	1.25	1.29	1.30	1.33	1.15	1.28	1.36
EPRA NRV per share, SEK	189	195	201	203	201	199	199	189
Cash flow per share from current
operations, SEK	1.25	1.51	1.01	1.36	1.45	1.24	1.47	1.37

ALTERNATIVE PERFORMANCE MEASURES

Hufvudstaden applies the European Securities and Markets Authority (ESMA) Guidelines on Alternative Performance Measures. According to these guidelines, alternative performance measures refer to a financial measurement of earnings performance, financial position, financial result or cash flow not defined according to IFRS or the Swedish Annual Accounts Act. Hufvudstaden is also a member of the European Public Real Estate Associations (EPRA) and reports financial key figures defined by EPRA. Below is the derivation of alternative performance measures. For definitions, see page 14.

SEK m	June 30, 2023	June 30, 2022	Full year 2022
Net asset value, see page 5.
Net debt
Non-current interest-bearing liabilities	7,300	6,500	6,500
Non-current leasing liabilities	704	704	703
Current interest-bearing liabilities	2,400	2,600	2,500
Current lease liabilities	8	8	9
Cash and cash equivalents	-543	-637	-453
Net debt	9,869	9,175	9,259
Equity ratio
Equity	29,343	31,296	31,262
Total assets	49,700	51,519	51,235
Equity ratio, %	59	61	61
Net loan-to-value ratio, properties
Net debt	9,869	9,175	9,259
Carrying amount, properties	47,837	49,630	49,547
Net loan-to-value ratio, properties, %	20.6	18.5	18.7
Interest coverage ratio
Profit or loss before tax	-1,154 2)	1,497 2)	904
Reversal of changes in value	2,295	-410	209
Financial expense1)	247 2)	153 2)	166
Total	1,388	1,240	1,279
Financial expense1)	247 2)	153 2)	166
Interest coverage ratio, multiple	5.6	8.1	7.7
EPRA Earnings (Earnings from property mgmt. after nom. tax)
Operating profit or loss before changes in value	689	626	1,298
Financial income and expense	-119	-82	-185
Earnings from property management	570	544	1,113
Current tax, earnings from property management	-39	-43	-88
EPRA Earnings (Earnings from property mgmt. after nom. tax)	531	501	1,025
Average number of outstanding shares, million	202.3	202.3	202.3
EPRA EPS, SEK	2.62	2.48	5.07
EPRA vacancy rate, %
Rental value for vacant space, in total	182	188	155
Rental value for vacant space, project	76	66	68
Total rental value	2,360	2,220	2,214
Vacancy rate, in total, %	7.7	8.5	7.0
Vacancy rate, project, %	3.2	3.0	3.0
EPRA vacancy rate, %	4.5	5.5	4.0

1) Excluding fees for withdrawal of mortgage deeds.

2) Recalculated 12 months.

RESULT AND FINANCIAL POSITION

Net revenue amounted to SEK 787.1 million (706.3). The increase was attributable primarily to indexation as well as higher gross rents in conjunction with new leases and renegotiations. Since early 2022, net revenue was charged with vacant premises attributable to the entire Inom Vallgraven 12 block in Gothenburg being emptied for the Johanna project.

Operating expenses amounted to SEK -466.3 million (-408.6). Maintenance costs increased mainly due to larger development projects. Energy costs were also a factor. Gross profit was SEK 320.8 million (297.7). Net financial income and expense was SEK -102.8 million (-66.1).

Cash and cash equivalents at the end of the period amounted to SEK 530.1 million (631.2). Investments in properties and inventory amounted to SEK 349.3 million (214.9).

MATERIAL RISKS AND UNCERTAINTIES

The Company is mainly exposed to financing, interest and credit risks. Other than what is stated for the Group on page 7, no other material risks or uncertainties have been identified apart from those described in the Annual and Sustainability Report 2022.

MATERIAL TRANSACTIONS WITH RELATED PAR-

TIES No material transactions with related parties took place during the period.

ACCOUNTING POLICIES

The Parent Company applies RFR 2 Accounting for Legal Entities and the Swedish Annual Accounts Act. This interim report has been prepared in accordance with Section 9 of the Annual Accounts Act, Interim Financial Statements. The accounting policies and basis for calculations remain unchanged from the Annual and Sustainability Report 2022.

	April	April	January	January	January
PARENT COMPANY, SEK m	June 2023	June 2022	June 2023	June 2022	December 2022
Net revenue1)	393.3	357.0	787.1	706.3	1,444.4
Operating expenses	-249.0	-213.6	-466.3	-408.6	-835.3
Gross profit	144.3	143.4	320.8	297.7	609.1
Central administration	-12.6	-12.8	-25.6	-25.6	-55.8
Items affecting comparability2)	-51.4	-	-51.4	-	-
Operating profit	80.3	130.6	243.8	272.1	553.3
Other financial income and expenses	-58.5	-35.8	-102.8	-66.1	4.7
Profit after financial items	21.8	94.8	141.0	206.0	558.0
Appropriations	-	-	-	-	-115.1
Profit before tax	21.8	94.8	141.0	206.0	442.9
Tax	-6.3	-19.6	-30.9	-42.7	-91.3
Profit for the period	15.5	75.2	110.1	163.3	351.6
Statement of comprehensive income, SEK m
Profit for the period	15.5	75.2	110.1	163.3	351.6
Other comprehensive income	-	-	-	-	-
Total comprehensive income for the period	15.5	75.2	110.1	163.3	351.6

INCOME STATEMENT - SUMMARY

1) For a breakdown of net revenue, see table on page 10.

2) Pertains to the demolition of a building in the Inom Vallgraven 12 block, where the Johanna project is ongoing.

BALANCE SHEET - SUMMARY

	June 30,	June 30,	December 31,
PARENT COMPANY, SEK m	2023	2022	2022
Investment properties	8,794.6	8,380.1	8,589.5
Other non-current assets	6,084.4	6,086.4	6,086.5
Total non-current assets	14,879.0	14,466.5	14,676.0
Current assets	963.0	1,000.7	771.6
Total assets	15,842.0	15,467.2	15,447.6
Restricted equity	1,978.7	1,978.7	1,978.7
Non-restricted equity	1,999.9	2,247.7	2,436.0
Total equity	3,978.6	4,226.4	4,414.7
Untaxed reserves	51.0	52.8	51.0
Provisions	909.2	907.8	911.5
Non-current liabilities	7,391.5	6,594.0	6,597.8
Current liabilities	3,511.7	3,686.2	3,472.6
Total equity and liabilities	15,842.0	15,467.2	15,447.6

BOARD CERTIFICATION

The Board of Directors and the President hereby certify that this Half-Year Report provides a true and fair overview of the operations, financial position and results of the Parent Company and the Group,

and describes material risks and uncertainties facing the Parent Company and the companies included in the Group.

Stockholm, August 24, 2023

Fredrik Lundberg Chairman

Claes Boustedt Peter Egardt Liv Forhaug Louise Lindh Board Member Board Member Board Member Board Member

Katarina Ljungkvist Anders Nygren Fredrik Persson Sten Peterson Board Member President and Board Member Board Member

Board Member

AUDITOR'S REVIEW REPORT

Hufvudstaden AB (publ), Corp. Reg. No. 556012-8240

Introduction

We have reviewed the condensed interim financial information (Half-Year Report) for Hufvudstaden AB (publ) as at June 30, 2023 and the six-month period then ended. The Board of Directors and the President are responsible for the preparation and fair presentation of this Half-Year Report in accordance with IAS 34 and the Swedish Annual Accounts Act. Our responsibility is to express an opinion on this Half-Year Report based on our review.

Scope of review

We conducted our review in accordance with the International Standard on Review Engagements ISRE 2410 Review of Interim Financial Information Performed by the Independent Auditor of the Entity. A review consists of making inquiries, primarily involving persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review has a different orientation and is substantially more limited in scope than an audit conducted in accordance with International Standards on Auditing (ISA) and generally accepted auditing standards.

The procedures performed in a review do not enable use to obtain assurance that we would become aware of all significant matters that might be identified in an audit. An opinion based on a review therefore does not have the certainty of an opinion based on an audit.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the Half-Year Report for the Group has not been prepared, in all material respects, in accordance with IAS 34 and the Swedish Annual Accounts Act, and for the Parent Company in accordance with the Swedish Annual Accounts Act.

Stockholm, August 24, 2023 PricewaterhouseCoopers AB

Magnus Svensson Henryson Authorised Public Accountant

DEFINITIONS AND GLOSSARY

Finance

Capital employed. Total assets reduced by non-interestbearing liabilities and deferred tax liabilities.

Central administration. Costs for Group management and Group staff functions, costs for maintaining the Company's stock exchange listing, and other costs common to the Company.

Debt/equity ratio. Net debt in relation to equity at the end of the period.

EPRA. European Public Real Estate Association. An interest association for listed property companies in Europe.

EPRA Earnings - Earnings from property management after nominal tax. Operating profit or loss before items affecting comparability and changes in value minus financial income and expense and computed current tax, excluding a carryforward of unutilised tax losses. The tax deducted has been calculated with account taken of tax-deductible depreciation and investments.

EPRA NDV - Net Disposal Value. Shareholders' equity according to the balance sheet.

EPRA NRV - Net Reinstatement Value. Shareholders' equity according to the balance sheet after reversal of interest rate derivatives and deferred tax according to the balance sheet, excluding deferred tax on assets and/or liabilities other than investment properties and right-of-use assets attributable to ground rents.

EPRA NTA - Net Tangible Assets. Shareholders' equity according to the balance sheet after reversal of derivative instruments and deduction for intangible assets, adjusted for estimated actual deferred tax instead of nominal deferred tax.

Equity ratio. Equity at the end of the period in relation to total assets.

Gross margin. Gross profit in relation to net revenue.

Interest coverage ratio. Profit or loss after net financial income/expense, excluding items affecting comparability and changes in value, plus financial expense in relation to financial expense. In the interim accounts, net profit or loss after net financial income/expense, excluding items affecting comparability and changes in value, as well as financial expense, have been recalculated on a full-year basis with no adjustments for seasonal variations that normally arise in the operations.

Items affecting comparability. Items of a non-recurring nature and which make it difficult to compare between two given periods.

MTN programme. Medium Term Note is a bond programme with a term of 1-15 years.

Net debt. Interest-bearing liabilities including lease liabilities and decided dividend minus current investments and cash and cash equivalents.

Net loan-to-value ratio, properties. Net debt in relation to the carrying amount of properties.

Earnings from property management. Operating profit or loss before items affecting comparability and changes in value minus financial income and expense.

Return on capital employed. Profit or loss before tax plus financial expense in relation to average capital employed. In the interim accounts, the return has been recalculated on a full-year basis with no adjustments for seasonal variations that normally arise in the operations and with the exception of items affecting comparability and changes in value.

Return on equity. Net profit or loss in relation to average equity. In the interim accounts, the return has been recalculated on a full-year basis with no adjustments for seasonal variations that normally arise in the Company's operations and with the exception of items affecting comparability and changes in value.

Return on equity, adjusted. Net profit or loss, excluding changes in value, in relation to average equity. In the interim accounts, the return has been recalculated on a fullyear basis with no adjustments for seasonal variations that normally arise in operations.

Tax. Total tax for the Group comprises both current tax and deferred tax.

Shares

Average number of outstanding shares. Weighted average number of outstanding shares during a defined period.

Earnings per share. Net profit or loss for the period in relation to the average number of outstanding shares during the period.

EPRA EPS. EPRA Earnings in relation to the average number of outstanding shares during the period.

Equity per share. Equity in relation to the number of outstanding shares at the end of the period.

Property

Annual rent. Gross rent at the end of the period, including supplements, calculated on an annual basis. Vacant premises are reported at the Estimated Rental Value (ERV).

Bibliotekstan. The area between Norrmalmstorg, Birger Jarlsgatan, Stureplan, and Norrlandsgatan, and which contains stores with high-class brand, restaurants and cafes.

EPRA vacancy rate. Estimated Market Rental Value (ERV) of vacant space divided by the ERV of all property holdings. Current development projects are excluded.

Fair value. The estimated market value of the properties.

Floor space vacancy rate. Vacant floor space in square metres in relation to the total rentable floor space.

Fredstan. The area around Fredsgatan between Brunnsparken and Trädgårdsföreningen, where the vision is to offer a unique range of stores, restaurants, and cultural events and facilities.

Market value, properties. The amount for which the properties could be exchanged between knowledgeable, willing parties in an arm's length transaction. In accounting terms, this is known as "fair value".

Net operating income. Net revenue from property management including intra-Group rent revenue less costs for property management.

Property tax supplement. Property tax payments received from tenants.

Rental vacancy rate. Estimated Market Rental Value (ERV) of vacant space divided by the ERV of all property holdings.

Surplus ratio. Net operating income as a percentage of net revenue from property management including intra-Group rent revenue.

In some cases, there has been rounding off, which means the tables and calculations do not always tally.

This document is in all respects a translation of the original Half-year Report in Swedish. In the event of any differences between this translation and the Swedish original, the latter shall prevail. #### Hufvudstaden

Hufvudstaden was founded in 1915 and rapidly became one of the leading property companies in Sweden. Today it is one of the country's strongest brands in the property sector. The brand is well known and represents high quality, good service, and long-term thinking in the management and development of the Company's commercial properties in the most attractive business locations in Stockholm and Gothenburg.

Purpose

Shaping the city of the future together, since 1915.

Vision

Hufvudstaden will be consistently perceived as, and prove to be, the most attractive property company in Sweden.

Business concept

With properties in central Stockholm and central Gothenburg, Hufvudstaden will offer successful companies high-quality office and retail premises in attractive marketplaces.

Financial objectives

• Hufvudstaden shares will have good dividend growth over time, and the dividend will amount to more than half the net profit from current operations.
• The equity ratio will be at least 40 per cent over time.

Operating objectives

Hufvudstaden will:

• gradually increase profit from current operations.
• have the most satisfied customers in the industry.
• have the most developed property holdings in the industry.
• have the most professional employees in the industry, with firm commitment to the customer, good business acumen and professional knowhow.

Strategies to achieve the objectives

Customer focus. Hufvudstaden will work in close cooperation with its customers and contribute to continuously improving their business potential and competitiveness.

Quality. Systematic quality management will ensure the highest possible level of quality in all of the company's products and services.

Competence development. Systematic development of the knowledge and skills of personnel will be ensured, with focus on professional know-how and values.

Business development. Active business development and adaptation to the digitalization of society will create added value in the property holdings.

Sustainability. Hufvudstaden will work actively and in the long term to ensure financial, environmental and social sustainability.

HUFVUDSTADEN AB (PUBL)

NK 100, SE-111 77 Stockholm Visiting address: Regeringsgatan 38 Telephone: +46 8 762 90 00 Email: info@hufvudstaden.se Website: www.hufvudstaden.se Company registration number: 556012-8240 Registered office: Stockholm