Klövern hedges interest on the debt portfolio
2009-02-18
The interest swaps mean that variable loans with the corresponding volume will be reported as interest fixed. With the new agreements, Klövern’s total holding of fixed loans amounts to SEK 4 billion, of which SEK 200 million mature in 2009, SEK 1.4bn in 2015, SEK 1.4bn in 2016 and SEK 1bn in 2017. Besides interest swaps, Klövern has derivatives in the form of interest caps corresponding to a volume of SEK 3,829 million. The debt portfolio totalled SEK 7,645 million on 31 December 2008.
“The new swap agreements reduce the interest risk in the debt portfolio by fixing base interests at a historically low interest level. It is worth giving up some of the profit today to ensure benefits tomorrow”, says Gustaf Hermelin.
In the current situation, these agreements lead to an increase in Klövern’s interest expense of around SEK 50 million to around SEK 270 million on an annual basis. When the economy starts to pick up again, it is likely that short market rates will rise and the swaps can give a positive effect on income. During 2008, interest expense totalled approximately SEK 350 million.
Nyköping 18 February 2009
Klövern AB (publ)
For further information, please contact:
Gustaf Hermelin, CEO, tel +46 155-44 33 10, +46 70-560 00 00, gustaf.hermelin@klovern.se
Caesar Åfors, CFO and vice President, tel +46 155-44 33 02, +46 70-662 48 48, caesar.afors@klovern.se
Britt-Marie Einar, Finance and Information Manager, tel +46 155-44 33 12, +46 70-224 29 35,
britt-marie.einar@klovern.se
Klövern is a real estate company committed to working closely with customers to meet their needs of premises and services in Swedish growth regions. Klövern has business units in ten cities: Borås, Karlstad, Kista, Linköping, Norrköping, Nyköping, Täby, Uppsala, Västerås and Örebro. As at 31 December 2008, the value of the properties totalled approximately SEK 11.9 billion and the rental value on an annual basis is approximately SEK 1.4 billion. The Klövern share is listed on OMX Nordic Exchange in Stockholm for medium-sized companies.
Klövern AB (publ), Box 1024, SE-611 29 Nyköping, Sweden. Tel +46 155-44 33 00, Fax +46 155-44 33 22.
Corporate registration no. 556482-5833. Registered office: Nyköping. Website: kelly.corem.se