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ANNUAL REPORT 2024
CONTENTS – ANNUAL REPORT 2024 BOARD OF DIRECTORS’ REPORT 2024 ......................................................................................................................................... 3 CONSOLIDATED FINANCIAL STATEMENTS – Steen & Strøm Group ............................................................................................ 13 CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME ....................................................................................................... 14 CONSOLIDATED STATEMENT OF FINANCIAL POSITION ................................................................................................................ 15 CONSOLIDATED STATEMENT OF CASH FLOWS ............................................................................................................................ 16 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY ................................................................................................................ 17 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS ........................................................................................................... 18 FINANCIAL STATEMENTS - Steen & Strøm AS ............................................................................................................................ 48 STATEMENT OF COMPREHENSIVE INCOME ................................................................................................................................. 49 STATEMENT OF FINANCIAL POSITION .......................................................................................................................................... 50 STATEMENT OF CASH FLOWS ....................................................................................................................................................... 52 STATEMENT OF CHANGES IN EQUITY ........................................................................................................................................... 53 NOTES TO THE FINANCIAL STATEMENTS ...................................................................................................................................... 54 INDEPENDENT AUDITOR’S REPORT .......................................................................................................................................... 60 ALTERNATIVE PERFORMANCE MEASURES (APM) ..................................................................................................................... 65
3 BOARD OF DIRECTORS’ REPORT 2024 Steen & Strøm’s shopping center portfolio demonstrated continued resilience towards macro economic events during 2024, posting a 3.2% growth in Net rental income on a like-for-like basis. Steen & Strøm has continued to strengthen the financial position during 2024, incl. a loan-to-value ratio of 21.8% end of the year, confirmed by an A- rating from S&P. Retailer sales has in general been stagnating during 2024 (+0.6%), with the best performance posted by Oslo City’s continued “return to normal” (+2.3%). This trend was widely spread across all retail sectors incl. e- commerce, driven by a general decline in “disposable income”, due to inflation, reestablishment of private savings and increasing cost of debt. As salary levels are increasing and cost of debt decreasing, we expect this trend to turn around in 2025. With several new signings of large retail concepts during second half of 2024, incl. «New Yorker», «Stadium Outlet» and «Fredrik & Louisa», Steen & Strøm is ready to welcome this trend in 2025. Steen & Strøm held nine shopping centers throughout 2024, located in major regional cities' catchment areas. The portfolio comprises resilient, large, and modern assets, adapted to consumer needs and expectations. This has to some extent been confirmed during 2024, despite the ongoing, economic challenges, with a moderate impact on occupancy levels, an overall satisfying collection rate, and satisfactory sales performance (in line with general trends). Net rental income on a like-for-like basis increased by +3.2% in 2024 (Norway +2.7%, Denmark +3.5% and Sweden +3.0%), fueled by indexation, to some extent off-set by intermediate vacancies due to bankruptcies. For the Group as a whole, the index-linked effect on net rental income was +3.0%, and occupancy was maintained at 95%. Total change in fair value of investment properties amounted to NOK 521.1 million in 2024 (NOK 129.9 million in Norway, NOK 169.4 million in Sweden and NOK 221.8 million in Denmark). The valuations are corresponding to an average net initial yield of 5.2% (4.6% in Norway, 5.6% in Sweden and 4.9% in Denmark), 7 basis points above 2023. The positive trend is widely spread across the portfolio, driven by improved cash flow in Norway, and decreasing interest rates’ influence on discount rates in Sweden and Denmark. KEY FIGURES ECONOMIC ENVIRONMENT On the back of high inflation, the rapid increase in interest rates throughout 2023, peaking in Q4, contributed to a significant rise in bankruptcies, particularly in the first half of 2024, with Sweden being most affected. Interest rates remained at their highest levels for an additional five months in Denmark and Sweden before a gradual reduction commenced. This process accelerated in Q4 2024, with central bank rates declining from 3.6% to 2.6% in Denmark and from 4% to 2.5% in Sweden. Norway remained an exception, maintaining its maximum interest rate at 4.5% throughout the year. High household debt levels and the wide extent of variable-rate mortgages in Sweden made consumers particularly sensitive to interest rate fluctuations. The prolonged period of elevated rates before reductions took effect strained purchasing power, leading to more cautious consumer behaviour. Discretionary spending declined as consumers reduced non-essential purchases, shopped less frequently, and prioritized cost savings by seeking lower-priced alternatives. This shift in consumer habits presented challenges for shopping centers, resulting in stagnating footfall and sales performance throughout 2024. Annual GDP growth Q3 2024, has increased in Denmark (+3.1%), Sweden (+1.1%) and Norway (+3.7%) compared to Q3 2023. The unemployment rate has increased in Norway (to 4.2%, +0.6% vs Dec 2023), whilst Sweden and
4 Denmark remained almost at same levels as in 2024 (8.0% +0.3% vs Dec 2023 and 2.6% +0.1% vs Dec 2023 respectively). RETAILER SALES
Steen & Strøm’s business model is to lease premises at its shopping centers to retailers.& Strøm’s business model is to lease premises at its shopping centers to retailers.
Total retailer sales for Steen & Strøm’s shopping centers increased by +0.6% in 2024 compared to 2023 on a like-for-like basis (same shops in 2024 and 2023) and +0.3% on a like-for-like center basis. Per country, like-for-like center sales increased by +1.3% in Norway and +0.4% in Sweden, decrease of -0.4% was recorded in Denmark. In the following, please notice that numbers in brackets are 2023 comparisons. NET RENTAL INCOME Net rental income from shopping center operations is NOK 1 395.6 million (NOK 1 347.2 million), of which gross rental income is NOK 1 572.1 million (NOK 1 519.3 million). Direct operating expenses at the shopping centers, included in net rental income, amounted to NOK 176.5 million (NOK 172.0 million). Figures exclude rental income from joint venture operated shopping centers, consolidated by application of the equity method (Metro and Økern). Total net rental income, including equity investments, was NOK 1 441.4 million in 2024 (NOK 1 399.8 million). Group share of net rental income from equity investments amounted to NOK 45.8 million in 2024 (NOK 52.5 million), explained by decrease in net rental income at Metro in Norway. The average duration of lease contracts is 5.6 years in Norway and 4.8 years in Sweden. Duration of contracts in Denmark is indefinite. OPERATING INCOME Steen & Strøm’s operating income was NOK 1 798.5 million (NOK -328.4 million) after fair value adjustments. Gain on disposal of subsidiaries and investment properties amounted to NOK 0.1 million in 2024 (loss of NOK - 7.9 million in 2023), while other operating revenue amounted to NOK 8.9 million (NOK 13.8 million). OPERATING EXPENSES In addition to direct operating expenses as defined above, other operating expenses include salaries, other general expenses, and depreciation, amounting to NOK 202.5 million in 2024 (NOK 223.7 million). The decrease is mainly related to research- and project studies that have been expensed during 2023. CHANGE IN THE FAIR VALUE OF INVESTMENT PROPERTIES Total fair value change of investment properties was NOK 521.1 million (NOK -1 524.4 million). The central banks in Sweden and Denmark have decreased the interest rates during 2024 as a result of stabilized inflation and less uncertainty in the economy, while in Norway, the interest rate has remained flat as a consequence of the weak NOK. The lower, stabilized interest rates and inflation have decreased discount rates and consequently increased the fair value of investment properties. The valuation of the shopping centers is reflecting an average net initial yield of 5.2%, compared to an average net initial yield of 5.1% in 2023. The shopping centers and projects have a book value of NOK 29.1 billion (NOK 28.1 billion) as of 31 December 2024, including equity method investments. The weakening of NOK against DKK and SEK during 2024 has increased the value of investment properties with NOK 0.7 billion. The majority of the Group’s assets consist of investment properties. The Group has established routines whereby investment properties are valued twice a year by an external appraiser. The valuation of investment properties is calculated using assumptions and estimates that require significant judgment and may vary significantly dependent on the assumptions applied.
5 COST OF NET DEBT Net cost of debt amounted to NOK 154.1 million (NOK 151.7 million), including a NOK -8.2 million currency exchange loss (gain of NOK 76.9 million). Net interest income from swaps was NOK 159.2 million in 2024 (net interest income of NOK 141.0 million). The increase in net interest income from swaps is due to an increase in floating interests received compared to the fixed interests paid. This is due to a general, average increase of the interest rates in the market compared to previous years. SHARE OF EARNINGS IN EQUITY INVESTMENT ENTITIES Share of earnings in equity investment entities amounted to NOK -11.4 million (NOK -40.1 million). Equity investments includes Økern and Metro. The development in share of earnings in equity investment entities is due to a lower decrease in values of investment properties compared to the decrease in values in 2023. PROFIT BEFORE TAX Profit before tax amounted to NOK 1 618 million (NOK -521.6 million). Adjusted for fair value changes related to the investment property portfolio and income from disposals, the pre-tax profit equals NOK 1 096.4 million, which is an increase of NOK 85.7 million from 2023. CASH FLOW Net cash flow from operating activities was NOK 1 241.9 million (NOK 1 353.3 million), while net cash flow from investment activities was NOK 299.3 million (NOK 150.0 million). Operating income adjusted for non-cash items (change in the fair value of investment properties and depreciations) and the reduction in outstanding receivables is broadly in line with cash flow from operating activities. Net cash flow from financing activities was NOK -1 451.1 million (NOK -1 230.4 million). The negative net cash flow from financing activities is due to repayment of loans and group contributions to the parent company’s shareholder. Cash and cash equivalents increased by NOK 90.1 million in 2024 and amounted to NOK 701.2 million on 31 December 2024. The Group has liquidity reserves through unused credit facilities of NOK 1 970 million. FINANCIAL POSITION Total assets for the Group as of 31 December 2024 amounted to NOK 31.3 billion (NOK 30.4 billion), of which investment properties and properties under construction amounted to NOK 27.3 billion (NOK 26.3 billion). Booked equity amounted to NOK 18.7 billion at year-end 2024, corresponding to a book equity ratio of 59.5% (57.0%). Net interest-bearing debt amounted to NOK 6.3 billion (NOK 6.8 billion) on 31 December 2024. An error in the consolidation mechanism related to tax integration led to an overstatement of the SST Group’s equity by NOK 627m as of the end of December 2023, including NOK 453m as of January 1, 2023. According to IAS8, this was corrected retrospectively in the 2024 Annual Report, decreasing the Equity and increasing Net Liabilities (Group Payables net of Deferred taxes) for the corresponding amounts. SHOPPING CENTER OPERATIONS Steen & Strøm operates nine shopping centers in Scandinavia, two centers in Norway, four centers in Sweden and three centers in Denmark. SHOPPING CENTERS IN NORWAY Steen & Strøm holds one fully owned shopping center (Oslo City) and one partly owned shopping center in Norway (Metro Senter). Økern Center is classified as a part of the Økern Sentrum development project and is not included in the figures. Metro Senter is also excluded from the figures. Oslo City saw an increase in retailer sales of +2.3% on a like-for-like shop basis in 2024. The shopping center had a total gross rental income of NOK 233.9 million (NOK 232.0 million) in 2024. Operating income, adjusted for fair value changes and income from disposals, amounted to NOK 198.9 million (NOK 121.0 million). Increase in net rental income like-for-like was +2.7% in 2024.
6 SHOPPING CENTERS IN DENMARK Steen & Strøm owns and operates three shopping centers in Denmark. The three fully owned shopping centers decreased retailer sales by -0.2% on a like-for-like shop basis in 2024. Gross rental income for the Danish centers amounted to NOK 686.6 million (NOK 656.5 million). Operating income, adjusted for fair value changes and income from disposals, amounted to NOK 547.5 million (NOK 565.0 million). Like-for-like increase in net rental income was 3.5% in 2024. SHOPPING CENTERS IN SWEDEN Steen & Strøm owns and operates four shopping centers in Sweden (Galleria Boulevard was divested 31/12/2023). The shopping centers saw an increase in retailer sales of +0.6% on a like-for-like shop basis in 2024. Gross rental income for the Swedish centers amounted to NOK 651.6 million (NOK 630.8 million). Operating income, adjusted for fair value changes and income from disposals, amounted to NOK 530.8 million (NOK 518.0 million). Like-for-like increase in net rental income was +3.0% in 2024. SHAREHOLDERS OWNERSHIP STRUCTURE
Storm Holding Norway AS
owns all shares in Steen & Strøm AS. & Strøm AS.
Klépierre
, the pan-European leader in shopping malls (56.1%), and Stichting Depositary APG Strategic Real Estate Pool (43.9%) indirectly control all shares of Storm Holding Norway AS through Nordica Holdco AB. Klépierre has its headquarter in Paris and has operations in 13 countries, including Norway, Sweden and Denmark. APG is one of the world’s largest pension fund managers, based in the Netherlands. GENERAL MEETINGS A General Meeting is held when required under the relevant legislation. General Meetings are called by the company`s sole shareholder, Storm Holding Norway AS, who also appoints the delegates to represent Storm Holding Norway AS in the General Meeting. BOARD OF DIRECTORS Steen & Strøm AS’ Board of Directors currently has five members, elected by the General Meeting. Pursuant to the company`s articles of association, the Board of Directors shall consist of between five and seven members. The Board of Directors also acts as the Audit Committee. The company`s majority shareholder, Klepierre SA, has taken out directors and officers liability insurance, covering the directors of the company and any of its subsidiaries for an amount of up to EUR 100 million. The insurance covers any pecuniary consequences as well as defence costs for any claim against the insured individuals introduced during the insurance period or the subsequent period and involving his individual or joint civil liability, attributable to an actual or alleged professional misconduct. SHAREHOLDER POLICY Steen & Strøm’s long-term goal is to ensure a competitive return on invested capital and equity. Assets are managed to give optimal long-term return.
7 ORGANISATION AND ENVIRONMENTAL ASPECTS EMPLOYEES Steen & Strøm is a Scandinavian organization with employees in Norway, Denmark and in Sweden. The Group had 100 (including fix term) employees by end of 2024. These employees are based at our offices in Oslo, Copenhagen and Stockholm and at our 9 shopping centers across Scandinavia. Steen & Strøm has a gender spilt of approximately 60% women and 40% men. Women constitute the majority in positions and departments like accounting, rental, marketing, HR and shopping centers (including four female shopping center managers), while men constitute the larger part in corporate management, development and technical operations. Normal working hours are the same for all employees. Steen & Strøm is an equal opportunity employer. The average yearly salary of women is lower than that of men as more men are working at managerial levels in the Group. The Board of Directors has three male members and two female members. The Scandinavian Management Team has five female members out of ten members in total. The Group constantly strive to avoid any kind of discrimination. Steen & Strøm´s majority shareholder, Klepierre SA, has adopted a gender equality policy which aims to increase the proportion of women in the senior management teams to 40%. The policy applies similarly to Steen & Strøm as a Klepierre group company. Steen & Strøm currently has a male CEO and a management group where 1/2 of the members are women. The Group has working environment committees, working closely together with employee representatives to maintain a good and positive work environment. Absence due to illness was 5.4% in 2024, an increase of 2.3%. The increase relates to some long-term sick leaves. No injuries or accidents of any significance occurred in Steen & Strøm the last year. TRANSPARENCY Steen & Strøm supports and respects the protection of international human rights, and the efforts to secure decent working conditions for all employees and strives to secure that we do not contribute to any breaches of such rights. Steen & Strøm is annually within end of June publishing an statement regarding our due diligence assessment and efforts made to secure compliance pursuant to the “Transparency Act” (“Åpenhetsloven”). Before 30 June 2025 the next statement will be released on the website. CORPORATE RESPONSIBILITY AND SUSTAINABILITY STATEMENT Steen & Strøm has for years, managed a sustainability program with the vision of being one of the leaders within corporate responsibility in our industry. Shopping centers are important social players in the local communities’, and this constitute the best possible basis for influencing both the environment and the society around, in a positive direction. Environmental and social responsibility is also a strategic, key element for Klépierre, our French majority owner. This includes all subsidiaries of the Klépierre Group. ACT4GOOD To meet our vision of sustainability, Steen & Strøm together with majority owner Klépierre, have launched a common CSR strategy, Act4Good. Act4Good have strong targets in all areas, with a deadline in 2030. Act4Good further combines the requirements of operational excellence with environmental, societal and social performance, resting on four pillars: • Achieving Net Zero, Act as a Climate Leader - which sums up the Group’s ambition to make a positive contribution to the environment. This pillar consists of our initiatives to; achieve a net zero carbon portfolio, contribute to circular economy with a strong focus on Recycling and Reuse or waste, engage our visitors to decrease carbon emissions related to transports by increased possibilities for electric car charging, bicycle parking and repair facilities and information about alternative transports like train and bus.
8 • Servicing Communities, Act as a local Contributor - which illustrates the importance of the Group’s local involvement and in the regions in which it operates. Initiatives in this pillar; Giving Back projects, Offer Green Services to visitors, All centers compliant with Internal Inclusion standards. • Growing People, Act as a Skills Developer – this is about: Upskill our employees in CSR every year, Create Klépierre Academies to upskill people and improve their employability, include inclusion clauses in all our Service providers contracts, Engage all employees in sponsorship programs aimed at empowering local communities, Protect people´s physical and mental health. • Promoting Sustainable Lifestyles, 50 million shoppers guided toward sustainable lifestyles – Promote sustainable commerce across all our shopping centers, dedicate one specific unit to new local responsible concepts, raise our visitor’s awareness of sustainable lifestyles through responsible events. ACHIEVING NET ZERO - ENVIRONMENTAL FOCUS Steen & Strøm aims to reduce the environmental impact in both the near and distant surroundings, by systematically analysing and mapping each shopping center’s environmental impact, definition of targets for the sustainable development and continuous improvements by individual actions, measurement and reporting. Steen & Strøm implemented ISO-14001 in 2014, with yearly internal and external audits by third party auditors. The pollution from the Group's activities is limited. However, Steen & Strøm has put a lot of effort into environmental issues and developed individual action plans to improve the Group’s environmental performance level. Renewable Energy Guarantees of Origin (GO) exists for all power purchased by Steen & Strøm in Norway, Sweden and Denmark. Moreover, for our center Emporia in Malmö, Sweden, all energy supplied is of renewable origin. For our center Field’s in Copenhagen, we have purchased Gold Standard certified climate compensation credits to compensate for the emissions of the district heating we are consuming. Steen & Strøm is also investing in new and existing centers to Build the most sustainable Platform for Commerce for the future; hence, responsible decision making in relation to development projects is required. In major development projects we comply with the international classification system “BREEAM”, aiming for level "excellent". BREEAM In Use is divided into two parts: Part 1 (Operation) and Part 2 (Management), and all of our 9 centers are certified in Part 1. All centers, except for Bryggen in Denmark, were certified in 2023, with Bryggen receiving its certification in 2024. In 2026, all centers will undergo recertification, with Bryggen's recertification taking place in 2027, as the certification is valid for 3 years. During these recertifications, they will be certified for both Part 1 and Part 2. GRESB In the annual Global Real Estate Sustainability Benchmark (“GRESB”) of 2024, Steen & Strøm reached a high score of 94 points out of 100 points possible, an increase by 2 points compared to 2023 and one point behind Klépierre. The 94-point score rank Steen & Strøm as No.1 in the peer group. A comprehensive non-financial report on environmental and social responsibility describes the Klépierre Group's commitment to meet its goal of being among the leaders in environmental and social responsibility in the shopping center industry. The report highlights key policies, target areas and action plans, as well as case studies that highlight focus areas within both Klépierre and Steen & Strøm. CLIMATE RISK The climate change is demanding for all of us. In Act4Good, the first pillar “Achieving Net Zero” Steen & Strøm goal is to be Carbon Net Zero by 2030 in relation to scope 1 and scope 2. We measure, follow up and take actions on a broad range of parameters identified as critical to achieve our goals. To reach our goal of becoming Carbon Net Zero by 2030, Steen & Strøm is looking into increase our buy of green district heating where possible. Furthermore Steen & Strøm is evaluating the possibility to exchange district heating by investing in heat pumps
9 instead where green district heating is not an option. Also, over the coming years some of the cooling machines used will be exchanged by new ones with less climate impact. In 2024, Steen & Strøm has also initiated 2 pilot projects in two of the Swedish shopping centers with an AI solution to increase energy efficiency even more. Various climate risks have been evaluated on how they would impact our business. To be in the front Steen & Strøm has used a third-party auditor to perform “Flood Risk Assessment” and “Natural Risk Assessment” on all our Shopping Centers during 2022. In 2024 Klépierre initiated and performed a Climate Risk Assessment of all assets in the Klépierre portfolio including the Steen & Strøm assets. Those assessments are followed up in our tool Komply to ensure actions being taken by relevant management levels in the organization. ORGANIZATION Steen & Strøm has a steering committee for CSR (Act for Good Committee) consisting of the following management representatives: Chief Executive Officer, Technical Director, Chief Operation Officers, Head of Marketing, Head of Human Resources, Head of Leasing and CSR Manager. Quarterly Act4Good calls are established with Klépierre to overview the status of our CSR work to reach our KPI`s. KEY TARGET AREAS Within energy management, Steen & Strøm is working proactively to reduce energy consumption and increase its share of renewable energy. The result of energy savings in 2024 vs. 2023 was -5%. Within waste management, the goal is to achieve the highest possible degree of sorting. The goals are set individually for each country and shopping center, with a recycled/reused waste proportion of 46% for the shopping centers by end of 2024 with a goal to reach 60% in 2030. Target for 2024 was reached. Within water management, the consumption was reduced by -7% in 2024 compared to 2023. Within transport, one of the main goals is to increase the number of charging stations/points for electric cars and a project has been started in 2024 to fulfil the goals for 2030. Steen & Strøm is supposed to comply with the Corporate Sustainability Reporting Directive (CSRD) as from 2025 according to the current framework. This poses a substantial workload for the group, proportionate to our scope and organization. We are positively observing proposals to simplify and even delay the implementation of the framework, and we will follow the development closely CORPORATE GOVERNANCE Steen & Strøm aims to comply with requirements outlined in laws, regulations and general good business ethics. The Group strives towards openness on its’ economic performance and business operations. Corporate governance is founded on a systematic application of principles laid down in Norwegian recommendations within the field, and we aim at harmonizing with current international guidelines of corporate governance. RISK MANAGEMENT AND CONTROL Steen & Strøm is following a framework of risk management and internal control developed with its majority owner, Klepierre. The purpose of this framework is to ensure a strong link between the overall strategy and goals of the Group, incl. daily operations in the various companies owned by the Group. During 2024, Steen & Strøm has continued to ensure harmonization of procedures for risk and compliance in accordance with Klépierre’s framework. This includes coordination of methodology for first and second level of controls, as well as internal audits on selected areas. Steen & Strøm has established a five-year strategy, which is the basis for yearly plans and budgets.
10 The Group activities involve different kinds of risk; operational risk, market risk, credit risk, liquidity risk and risks related to floating/fixed interest rates. The Board of Directors set the goals and frameworks for operational and financial risks. The main driver in the operational business of the Group is the development in retail spending. Based on available public forecasts we have reason to believe that retail spending in the shopping center business in the Scandinavian markets will be continued on a sustainable level. The Group’s credit risk is primarily related to the ability of the tenants to pay rent. Steen & Strøm has some 1 000 leasing contracts. Prominent, stable retail chains form the major Group of our tenants. Clear routines have been established on credit check of tenants before contract signing and follow-up of due invoices. The Group loss on receivables is limited. The liquidity risk is managed by always having reserves in the form of liquid, current assets, unused credit facilities and un- mortgaged properties. We aim to limit liquidity risk that arises from the refinancing of Group debts by scheduling maturity dates for loans at different times of the year and by having sufficient reserves to cover short-term refinancing needs. To reduce the exposure to interest-rate changes in the short-term interest market, the Group has signed fixed interest swaps for approximately 90% of its loan portfolio. EMPLOYEES AND WORKING ENVIRONMENT Steen & Strøm’s most important resource is its employees. The Group aims to promote a healthy working environment for all employees. This by involving employees and follow-up in terms of employee satisfaction surveys. The physical work environment is monitored through meetings concerning the Group’s working environment both at Scandinavian and national level. Risk assessment has been prepared for each center, as well as feedback from employees. Steen & Strøm strives to offer regular courses in safety, first aid and fire fighting for all relevant staff. The number of work-related accidents is very low. ACTIONS AGAINST CORRUPTION Klepierre adopted a new Code of Conduct in 2024, which is also applicable to all Steen & Strøm employees. Further Steen & Strøm has an employee manual and ethical guidelines where regulations are incorporated to highlight the Group’s attitude to prevent corruption, and in line with the Working Environment Act, established procedures for whistleblowing and notification. Steen & Strøm has also established actions to reveal possible corruption, which includes routines to assess conflicts of interest and gifts and invitations, in line with Klepierre`s framework. It’s mandatory for all new employees to attend a virtual anti-corruption training developed by Klepierre. CUSTOMER-CENTRIC MALL MANAGEMENT Steen & Strøm is a retailed focused company concentrating its efforts on better serving its direct clients: the retailers. This is achieved through an active marketing policy and specific mall design guidelines, both aimed at enhancing the customer experience in its malls: • Retail First means that Steen & Strøm regularly interacts with national and international retailers in order to facilitate their growth efficiently, whether this means optimizing their presence and their store format or offering new points of sale. • Always something to discover, launched together with the majority owner Klépierre, sums up the positioning of the Steen & Strøm centers’ offer. It conveys the idea of always offering new experiences to our customers, infusing a “retailtainment” spirit combining retail and entertainment into all Steen & Strøm shopping centers. • Clubstore launched together with majority owner Klépierre, is Steen & Strøm’s comprehensive approach to the customer experience. The approach contains a holistic set of detailed standards with respect to our engagement with customers, from digital access to welcome desks, from parking to storefronts, from lightening to sound & smell, from break zones to kids’ entertainment etc. FINANCIAL REPORTING PROCESS Steen & Strøm AS has bonds listed on Oslo Stock Exchange. Consequently, the external financial reporting is compliant with the regulations of Oslo Stock Exchange and Norwegian laws and regulations in general. Internal financial reporting is produced on a quarterly basis, financial results assessed and analysed against budgets and
11 last year figures and KPIs are monitored monthly. Number of board meetings was three in 2024. Financial performance was to some extent on the agenda in all these meetings. The Group financial statements are prepared by the financial department and are audited by an independent auditor on a yearly basis. In addition, external companies perform audits and controls on specific issues. Routines for reporting and benchmarking contribute to make irregular costs visible. Investment properties are stated in the balance sheet at fair value, according to IAS 40. Value of investment properties makes up 95% of all Group assets and is Steen & Strøm’s only Key Account Matter (KAM). An independent external appraiser, Cushman & Wakefield, makes the valuation of the investment properties. The valuations are carried out according to the Red Book issued by the Royal Institution of Chartered Surveyors (RICS). The valuation methods used are the discounted cash flow method (DCF) and capitalization of net market rental value. ACTIONS OF CONTROL Steen & Strøm organizes internal and external actions of control. Internal control actions comprise mainly ordinary internal control within the financial and operational processes. External controls actions comprise ordinary audit, extended audit, risk analyses and insurance analyses. GOING CONCERN The financial statements have been presented under the assumption of going concern. It is the opinion of the Board of Directors that the financial statements and notes presented for the year give satisfactory information about the Group’s operations and financial position at the end of the year. The Board of Directors confirms that the annual accounts give a true picture of the Company’s and the Group’s assets, liabilities, financial position and result for the year. It is the Board of Directors’ opinion that nothing of significance has occurred after the end of the year that would harm the Group’s reputation or change the Group’s financial position. In accordance with Section 3-3a of the Norwegian Accounting Act, we hereby confirm that conditions for going concern is fulfilled. The Group has a shopping center portfolio of high quality, a strong financial position and employees with high competence within the shopping center business. STEEN & STRØM AS Steen & Strøm AS is a limited liability company incorporated in & Strøm AS is a limited liability company incorporated in
Norway
. The company is providing administrative services and property management services for the other entities within the Steen & Strøm Group and jointly controlled companies. Most of its operating income is from selling administrative and property management services. All employees in Norway are employed by Steen & Strøm AS. Also, the Steen & Strøm Group bond (certificates) financing is conducted through this company. Steen & Strøm AS had a profit for the year of NOK 200.9 million (NOK 737.8 million). The company has a very solid financial position with a book equity ratio of approximately 60% on 31 December 2024. FUTURE PROSPECTS THE MARKET IN GENERAL Consumer spending has historically been stable in Scandinavia compared to other regions. The outlook for 2025 is still influenced by shifting retailer sales trends, due to the continuous, general economic volatility. Inflation seems to have peaked, and sales trends are still very volatile but moderately increasing. In general, we continue to observe a “polarization” of shopping malls, where larger and well-located shopping centers continue to perform well. STEEN & STRØM’S MARKET POSITION Steen & Strøm’s shopping centers are located in major regional cities’ catchment areas. For most of the shopping centers, between 100 000 and 1 800 000 people live less than 30 minutes away by car. Our portfolio comprises
12 large and modern assets, which is viewed as attractive by the tenants. This is confirmed by the Group’s ability to deliver positive NRI growth on a stable and a relatively high occupancy rate of 95% by the end of 2024. Consequently, Steen & Strøm is expecting a long-term positive development for the real estate property business. The board of directors would like to thank all employees and customers for great efforts and positive contributions in 2024. Oslo, 3 April 2025
13 CONTENTS – CONSOLIDATED FINANCIAL STATEMENTS CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME ....................................................................................................... 14 CONSOLIDATED STATEMENT OF FINANCIAL POSITION ................................................................................................................ 15 CONSOLIDATED STATEMENT OF CASH FLOWS ............................................................................................................................ 16 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY ................................................................................................................ 17 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS ........................................................................................................... 18 1 GENERAL INFORMATION .................................................................................................................................................. 18 2 ACCOUNTING PRINCIPLES ................................................................................................................................................. 18 3.1 ‐ SEGMENT INFORMATION ............................................................................................................................................ 26 3.2 - NET BOOK VALUE OF INVESTMENT PROPERTIES AND PROPERTIES UNDER CONSTRUCTION BY OPERATING SEGMENT ............................................................................................................................................................................. 27 3.3 - AQUISITIONS BY OPERATING SEGMENT ...................................................................................................................... 28 4.1 ‐ SUBSIDIARIES ............................................................................................................................................................... 29 4.2 - GOODWILL ................................................................................................................................................................... 30 5.1 - INTANGIBLE ASSETS ..................................................................................................................................................... 30 5.2 ‐ FURNITURE AND EQUIPMENT ..................................................................................................................................... 31 5.3A ‐ INVESTMENT PROPERTIES ......................................................................................................................................... 32 5.3B ‐ INVESTMENT PROPERTIES UNDER CONSTRUCTION .................................................................................................. 32 5.3C ‐SENSITIVITY AND ESTIMATION UNCERTAINTY ........................................................................................................... 33 5.4A ‐ INVESTMENTS IN JOINTLY CONTROLLED COMPANIES .............................................................................................. 34 5.4B - EQUITY METHOD ‐ STATEMENT OF COMPREHENSIVE INCOME ............................................................................... 35 5.4C - EQUITY METHOD ‐ STATEMENT OF FINANCIAL POSITION ........................................................................................ 35 5.5 ‐ OTHER NON‐CURRENT ASSETS .................................................................................................................................... 36 5.6 ‐ TRADE RECEIVABLES .................................................................................................................................................... 36 5.7 ‐ OTHER RECEIVABLES .................................................................................................................................................... 37 5.8 ‐ CASH AND CASH EQUIVALENTS ................................................................................................................................... 37 5.9 ‐ SHAREHOLDERS' EQUITY.............................................................................................................................................. 37 5.10 ‐ NON‐CURRENT AND CURRENT FINANCIAL LIABILITIES .............................................................................................. 38 5.11 ‐ SOCIAL AND TAX LIABILITIES AND OTHER LIABILITIES ............................................................................................... 39 5.12 - GUARANTEES, BAIL DECLARATIONS AND PLEDGES ................................................................................................... 39 6.1 ‐ INCOME FROM DISPOSAL OF INVESTMENT PROPERTIES AND EQUITY INSTRUMENTS .............................................. 39 6.2 ‐ NET COST OF DEBT....................................................................................................................................................... 40 7 - TAX .................................................................................................................................................................................. 40 8 ‐ EXPOSURE TO RISK.......................................................................................................................................................... 41 9 ‐ LEASES ............................................................................................................................................................................. 43 10 ‐ PAYROLL EXPENSES ....................................................................................................................................................... 45 11.1 ‐ FAIR VALUE MEASUREMENTS .................................................................................................................................... 46 11.2 - LITIGATIONS AND CLAIMS ......................................................................................................................................... 47 11.3 ‐ RELATED PARTIES ....................................................................................................................................................... 47 11.4 ‐ POST‐BALANCE SHEET DATE EVENTS ......................................................................................................................... 47 11.5 ‐ AUDIT FEES ................................................................................................................................................................ 47
14 CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME In thousands of NOK Note 2024 2023 Restated Gross rental income 1 572 145 1 519 283 Non-recovered rental expenses -143 075 -158 885 Building expenses (owner) -33 484 -13 150 Net rental income 3.1, 9 1 395 586 1 347 247 Management, administrative and related income 75 345 66 552 Other operating revenue 8 875 13 808 Change in the fair value of investment properties 5,3 521 134 -1 524 435 Payroll expenses 10 -121 565 -121 345 Other general expenses 11.3,11.5 -65 616 -91 015 Depreciation and impairment on investment properties 5,3 -288 -270 Depreciation and impairment on intangible assets and furniture and equipment 5.1,5.2 -15 002 -11 022 Proceeds from disposal of investment properties and equity investments 478 206 63 913 Net book value of investment properties and equity investments sold -478 090 -71 823 Gain on disposal of investment properties and equity investments 6.1 116 -7 909 Operating income 1 798 584 -328 389 Net dividends and provisions on non-consolidated investments 62 48 Financial income 332 255 471 505 Financial expenses -486 339 -623 175 Net cost of debt 6,2 -154 084 -151 670 Change in the fair value of financial instruments -15 578 -1 517 Share of earnings in equity investment entities 5.4 -11 365 -40 112 Profit before tax 1 617 619 -521 639 Corporate income tax 7 -407 974 241 268 Net income of consolidated entity 1 209 645 -280 371 Average number of shares (in thousands) 29 303 29 303 Earnings per share 41 -10 In thousands of NOK 2024 2023 Restated Net income of consolidated entity 1 209 645 -280 371 Other comprehensive income items recognized directly as equity Items that may be reclassified subsequently to profit or loss Gain/loss on cash flow hedges -94 481 -211 902 Income tax related to cash flow hedges 7 4 372 24 537 Exchange differences on translation of foreign operations 371 707 988 437 Items that will not be reclassified subsequently to profit or loss Other comprehensive income 281 597 801 071 Total comprehensive income 1 491 243 520 701 Comprehensive earnings per share 51 18 The accompanying notes are an integral part of the consolidated financial statements.
15 CONSOLIDATED STATEMENT OF FINANCIAL POSITION In thousands of NOK Note 31/12/2024 31/12/2023 Restated Goodwill 4.2 348 425 348 425 Intangible assets 5.1 23 367 20 772 Furniture and equipment 5.2 28 740 27 885 Investment properties and properties under construction 3.2, 5.3, 5.10, 9, 11.1 27 318 598 26 339 782 Equity method securities 5.4 1 744 134 1 790 398 Other non-current assets 5.5, 11.1 6 254 6 471 Non-current derivatives 8, 11.1 166 623 277 101 Deferred tax assets 7 8 205 149 160 NON-CURRENT ASSETS 29 644 346 28 959 995 Investment properties held for sale 5.3a, 11.1 419 115 475 819 Trade accounts receivables 5.6, 11.1 146 016 126 010 Other receivables 5.7, 11.1 412 471 275 066 Current derivatives 8, 11.1 - 0 Cash and cash equivalents 5.8 701 233 598 256 CURRENT ASSETS 1 678 835 1 475 150 TOTAL ASSETS 31 323 180 30 435 145 Share capital 5.9 73 259 73 259 Share premium 4 028 584 4 028 584 Consolidated reserves 13 340 351 13 520 748 Hedging reserves 93 332 183 441 Other consolidated reserves 13 247 019 13 337 306 Consolidated earnings 1 209 645 -280 371 SHAREHOLDERS' EQUITY 18 651 839 17 342 220 Non-current financial liabilities 5.10, 11.1 7 257 685 6 632 134 Non-current derivatives 8, 11.1 6 658 14 533 Security deposits and guarantees 11.1 140 932 137 247 Deferred tax liabilities 7 4 058 427 3 786 782 NON-CURRENT LIABILITIES 11 463 702 10 570 696 Current financial liabilities 5.10, 11.1 211 559 1 162 784 Bank facilities 5.8, 11.1 0 -0 Trade payables 11.1 189 162 119 650 Other liabilities 5.11, 11.1 195 525 1 005 335 Current derivatives 8, 11.1 - - Social and tax liabilities 5.11, 11.1 607 593 234 461 CURRENT LIABILITIES 1 207 638 2 522 230 TOTAL SHAREHOLDERS’ EQUITY AND LIABILITIES 31 323 180 30 435 145 The accompanying notes are an integral part of the consolidated financial statements.
16 CONSOLIDATED STATEMENT OF CASH FLOWS In thousands of NOK Note 2024 2023 Restated Net income of consolidated entity 1 209 645 -280 371 Depreciation and impairment investment properties, intangible assets, 15 290 11 292 Change in the fair value of investment properties -521 134 1 524 435 Capital gains and losses on asset disposals net of taxes and deferred taxes 6 601 5 118 Corporate income tax 407 974 -241 268 Share of earnings in equity method investees 11 365 40 112 Reclassification of financial interests and other items 227 183 271 256 Paid taxes -56 873 -80 193 Change in operating working capital -58 184 102 926 Net cash flow from operating activities 1 241 867 1 353 306 Proceeds from sale of investment properties 6,1 478 079 60 091 Proceeds from sale of other fixed assets - 95 Proceeds from disposal of subsidiaries (net of cash disposed) 6,1 127 3 822 Acquisitions of investment properties 5,3 -23 547 -35 596 Payments in respect of construction work in progress 5,3 -135 869 -142 732 Acquisitions of other fixed assets 5.1,5.2 -1 289 -10 033 Proceeds of loans and advance payments granted and other investments 6,1 -18 161 274 334 Net cash flow from investing activities 299 340 149 981 Dividends and group contributions paid to the parent company’s shareholders -679 352 -257 593 New loans, borrowings and hedging instruments 5,10 559 548 1 408 453 Repayment of loans, borrowings and hedging instruments 5,10 -1 160 951 -2 195 236 Interest paid -167 512 -183 263 Other cash flows related to financing activities -2 805 -2 777 Net cash flow from financing activities -1 451 072 -1 230 416 Net changes in cash 90 135 272 872 Cash at the start of the period 598 256 313 824 Effect of foreign exchange differences 12 842 11 560 Cash at the end of the period 5.8 701 233 598 256 The accompanying notes are an integral part of the consolidated financial statements.
17 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY 31/12/2023 In thousands of NOK Share capital Additional paid- in capital Hedging reserves FX conversion reserves Consolidated reserves Consolidated earnings Total Equity Opening statement (as reported) 73 259 4 028 584 370 807 1 513 223 11 187 815 579 753 17 753 441 Prior period corrections (see note 1) - - - - -453 202 - -453 202 Opening statement (restated) 73 259 4 028 584 370 807 1 513 223 10 734 612 579 753 17 300 238 Reclassification of last year's net income - - - - 579 754 -579 754 - Net income for the period - - - - - -280 371 -280 371 Net income of consolidated entity - - - - 579 754 -860 124 -280 371 Income from cash-flow hedging net after tax - - -187 366 - - - -187 366 Exchange differences on translation of foreign operations - -0 0 963 458 24 979 0 988 437 Other comprehensive income - -0 -187 366 963 458 24 979 0 801 071 Group contribution - - - -476 404 - -476 404 Dividends paid - - - - - - - Other Movements - - - - -2 315 - -2 315 Closing statement (restated) 73 259 4 028 584 183 441 2 476 681 10 860 626 -280 371 17 342 220 31/12/2024 In thousands of NOK Share capital Additional paid- in capital Hedging reserves FX conversion reserves Consolidated reserves Consolidated earnings Total Equity Opening statement (restated) 73 259 4 028 584 183 441 2 476 681 10 860 626 -280 371 17 342 220 Reclassification of last year's net income - - - - -280 371 280 371 - Net income for the period - - - - - 1 209 645 1 209 645 Net income of consolidated entity - - - - -280 371 1 490 016 1 209 645 Income from cash-flow hedging net after tax - - -90 109 - - - -90 109 Exchange differences on translation of foreign operations - - - 371 707 - - 371 707 Other comprehensive income - - -90 109 371 707 -0 - 281 597 Group contribution - - - -205 065 - -205 065 Dividends paid - - - - - - - Other Movements - - - - 23 442 - 23 442 Closing statement 73 259 4 028 584 93 332 2 848 388 10 398 632 1 209 645 18 651 839
18 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1 GENERAL INFORMATION
Steen & Strøm AS& Strøm AS
(the Company) is a
limited liability company
incorporated in Norway. The Company’s principal offices are
located at Dronning Eufemias gate 8, N-0191 Oslo,
Norway
. The Group also has offices in Copenhagen and Stockholm, in
addition to offices at the shopping centers. The consolidated financial statements for the accounting period of 1 January 2024 to 31 December 2024 were authorised for issue in accordance with a resolution of the Board of Directors on 3 April 2025. The principal activities of the Company and its subsidiaries (the Group) are described in Note 3.1 Segment information.
2 ACCOUNTING PRINCIPLES
2.1 BASIS OF PREPARATION
The consolidated financial statements for the year 2024 have been prepared in accordance with IFRS® Accounting Standards as adopted by the European Union. The Group’s consolidated statement of comprehensive income (EPRA model), consolidated statement of financial position (EPRA model), consolidated statement of cash flows and consolidated statement of changes in
equity are presented with comparable numbers for the prior year.
The functional currency of Steen & Strøm AS is the Norwegian
krone (NOK), thus group accounts are presented in NOK. Presentation and classification of items in the financial statements is
consistent for the periods presented.
The consolidated financial statements have been prepared on a historical cost basis,
except for certain assets and liabilities which are presented at fair value (primarily derivatives contracts and investment properties).
Steen & Strøm Group uses the EPRA model for reporting of consolidated statements of comprehensive income and consolidated statements of financial position. EPRA is an abbreviation for the European Public Real Estate Association. EPRA’s mission is to promote, develop and represent the European public real estate sector. The EPRA reporting model makes the financial statements of public real estate companies clearer and more comparable across Europe which in turn enhances the transparency and coherence of the sector. The EPRA reporting model is used by more than 80% of Europe’s real estate companies, including Klépierre. For more information, visit the Association’s website at www.EPRA.com.
2.2 APPLICATION OF NEW AND REVISED INTERNATIONAL FINANCIAL REPORTING STANDARDS AND AMENDMENTS New standards and amendments adopted as of 1 January 2024 No standards adopted by the Group for the first time for the current period have a material impact on the amounts reported, presentation or disclosures in these financial statements. New IFRS Accounting Standards, amendments and interpretations issued but not effective for the financial year ending 31.12.2024 and not early adopted Certain new accounting standards and interpretations have been published that are not mandatory for 31 December 2024 reporting periods and have not been early adopted by the Group. No new and revised IFRS Accounting Standards issued are deemed to have any material impact on the consolidated financial statements for the Group.
2.3 CONSOLIDATION
The consolidated financial statements include the financial statements of Steen & Strøm AS (the Company) and entities controlled by Steen & Strøm AS (the Group). Control is achieved when the Group: • has power over the investee; • is exposed, or has rights to variable returns from its involvement with the investee; and • has the ability to use its power to affect its returns. Control normally exists when the Group has more than 50% of the voting power through ownership or agreements. Non- controlling interests in subsidiaries are presented within the Group’s equity.
The Group applies the acquisition method under IFRS 3 to account for business combinations. Subsidiaries are fully consolidated from the date on which control is obtained and ceases from the date control is lost.
Investments in associated companies, where the Group has significant influence but not control, are accounted for using the equity method of accounting. Significant influence is the power to participate in the financial and operating policy decisions of the associate but is not control or joint control over those policies.
A joint venture is a joint arrangement whereby the parties that have joint control of the arrangement have rights to the net assets of the joint arrangement. Joint control is the contractually agreed sharing of control of an arrangement which exists only when decisions about the relevant activities require unanimous consent of the parties sharing control. The Group report its
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interests in joint ventures using the equity method of accounting. Using the equity method, an investment in a joint venture is initially recognised in the financial statements at cost and adjusted thereafter to recognise the Group’s share of profit or loss and other comprehensive income of the joint venture. When the Group’s share of losses of an associate or joint venture exceeds the Group’s interest in the associate or the joint venture, the Group discontinues recognising its share of further losses. Additional losses are recognised only to the extent that the Group has incurred legal or constructive obligations or made payments on behalf of the associate or joint venture. Intercompany transactions and related balance sheet items, including internal profit and unrealised gains and losses are eliminated. Profits and losses resulting from upstream and downstream transactions between the Group and its associates are recognised in the Group’s financial statements only to the extent of unrelated investor’s interests in the associates. Unrealised losses are eliminated unless the transaction provides evidence of an impairment of the asset transferred.
Non-current assets and disposal groups are classified as held for sale if their carrying amount will be recovered principally through a sales transaction rather than through continuing use. This condition is regarded as met only when the sale is highly probable, and the non-current asset (or disposal group) is available for immediate sale in its present condition. Management must be committed to the sale, which should be expected to qualify for recognition as a completed sale within one year from the date of classification. The Group consider that a sale is highly probable when a binding Sales and Purchase Agreement (SPA) is signed. Non-current assets (and disposal groups) classified as held for sale are measured at the lower of their previous carrying amount and fair value less costs to sell.
2.4 CLASSIFICATION OF INCOME AND EXPENSES IN THE CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (EPRA MODEL) The Group applies these classifications in Net rental income: Gross rental income Gross rental income includes rents from investment property and rent-related income such as car park rentals and early termination indemnities, income from entry fees and other related income. Stepped rents, rent-free periods and entry fees are recognised over the fixed term of the lease contract. Non-recovered rental expenses Non-recovered building rental expenses are stated net of charges re-invoiced to tenants and mainly comprise expenses related to vacant premises. Building expenses (owner) Building expenses (owner) consist of owner’s expenses related to construction work, legal costs, bad debt expense and costs related to real estate management. In addition, Revenue classified as part of Operating income is: Other operating revenues Other operating revenues include building works re-invoiced to tenants and other income.
2.5 CASH AND CASH EQUIVALENTS In the consolidated statement of cash flows, cash and cash equivalents include cash in hand, deposits held at call with banks, other short-term highly liquid investments with original maturities of three months or less and bank overdrafts. See note 5.8 for information related to bank credit facilities.
2.6 TRADE ACCOUNTS RECEIVABLE Trade receivables are primarily lease receivables from tenants and meet the requirements of SPPI and the business model of hold to collect. These receivables are initially recognised at fair value and subsequently measured at amortised cost less any loss allowance for expected credit losses (ECL). The loss allowance for the trade receivables is measured each period at an amount equal to lifetime expected credit losses, as an accounting policy choice allowed in IFRS 9 for lease receivables. See notes 2.11 and 5.6 for additional information.
2.7 HEDGE ACCOUNTING At the inception of each hedge relationship a specific derivative is designated as a hedge of future cash flows related to a highly probable forecasted transaction, normally for the Group this is a floating-rate interest payment. Documentation is created at the inception of the hedge for the relationship between the hedging instrument (derivative) and the hedged item (future cash flows), as well as to document possible sources of hedge ineffectiveness and the evaluation of hedge effectiveness. All hedges, both at hedge inception and on an ongoing basis, are assessed prospectively for hedge effectiveness. The effective portion of changes in the fair value of derivatives that are designated and qualify as hedge instruments for a cash flow hedge is recognised in other comprehensive income (OCI). The ineffective portion is recognised in the profit or loss statement.
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When a hedging instrument expires or is sold, or when a hedge no longer meets the criteria for hedge accounting, any cumulative gain or loss existing in OCI at that time remains in OCI and is recognised when the forecasted transaction is
ultimately recognised in profit or loss.
When a forecasted transaction is no longer expected to occur, the cumulative gain or loss
that was reported in OCI is immediately transferred to profit or loss.
2.8 LEASING The details of accounting policies under IFRS 16 are presented below. (I) The Group as lessee The Group assess whether a contract is or contains a lease, at inception of the contract. The Group recognises a right-of-use asset and a corresponding lease liability with respect to all lease arrangements in which it is the lessee, except for short-term leases (defined as leases with a lease term of 12 months or less) and leases of low value assets (such as tablets and personal computers, small items of office furniture and telephones). For these leases, the Group recognises the lease payments as an operating expense on a straight-line basis over the term of the lease unless another systematic basis is more representative of the time pattern in which economic benefits from the leased assets are consumed. The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted by using the rate implicit in the lease. If this rate cannot be readily determined, the lessee uses its incremental borrowing rate. Lease payments included in the measurement of the lease liability comprise: • Fixed lease payments (including in-substance fixed payments), less any incentives receivable, • Variable lease payments that depend on an index or rate, initially measured using the index or rate at the commencement date, • The amount expected to be payable by the lessee under residual value guarantees, • The exercise price of purchase options, if the lessee is reasonably certain to exercise the options, and • Payments of penalties for terminating the lease, if the lease term reflects the exercise of an option to terminate the lease. The lease liability is presented within non-current financial liabilities and Current financial liabilities in the consolidated statement of financial position. The lease liability is subsequently measured by increasing the carrying amount to reflect interest on the lease liability (using the effective interest method) and by reducing the carrying amount to reflect the lease payments made. The Group re-measure the lease liability (and makes a corresponding adjustment to the related right-of-use asset) whenever: The lease term has changed or there is a significant event or change in circumstances resulting in a change in the assessment of exercise of a purchase option, in which case the lease liability is re-measured by discounting the revised lease payments using a revised discount rate. The lease payments change due date to changes in an index or rate or a change in expected payment under a guaranteed residual value, in which cases the lease liability is re-measured by discounting the revised lease payments using a revised discount rate. The lease payments change due to changes in an index or rate or a change in expected payment under a guaranteed residual value, in which cases the lease liability is re-measured by discounting the revised lease payments using an unchanged discount rate (unless the lease payments change is due to a change in a floating interest-rate), in which case a revised discount rate is used. A lease contract is modified, and the lease modification is not accounted for as a separate lease, in which case: • The lease liability is re-measured based on the lease term of the modified lease by discounting the revised lease • Payments using a revised discount rate at the effective date of the modification The Group did not make any such adjustments during the periods presented. The right-of-use assets comprise the initial measurement of the corresponding lease liability, lease payments made at or before the commencement day, less any lease incentives received and any initial direct costs. They are subsequently measured at cost less accumulated depreciation and impairment losses. Whenever the Group incurs an obligation for costs to dismantle and remove a leased asset, restore the site on which it is located or restore the underlying asset to the condition required by the terms and conditions or the lease, a provision is recognised and measured under IAS 37. To the extent that the costs relate to a right-of-use asset, the costs are included in the related right-of-use asset, unless those costs are incurred to produce inventories. Right-of-use assets are depreciated over the shorter period of lease term and useful life of the underlying asset. If a lease transfers ownership of the underlying asset or the cost of the right-of-use asset reflects that the Group expects to exercise a purchase option, the related right-of-use asset is depreciated over the useful life of the underlying asset. The depreciation starts at the commencement date of the lease.
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The right-of-use assets are presented within Furniture’s and equipment and Investment properties and properties under construction in the consolidated statement of financial position. The Group applies IAS 36 to determine whether a right-of-use asset is impaired and accounts for any identified impairment loss as described in the Furniture and equipment policy. Variable rents that do not depend on an index or rate are not included in the measurement of the lease liability and the right-of- use asset. The related payments are recognised as an expense in the period in which the event or condition that triggers those payments occurs and are included in the Other general expenses in profit of loss. (II) The Group as lessor The Group enters into lease agreements as a lessor with respect to its investment properties. Leases for which the Group is a lessor are classified as finance or operating leases. Whenever the terms of the lease transfer substantially all the risk and rewards of ownership to the lessee, the contract is classified as a finance lease. All other leases are classified as operating leases. When the Group is an intermediate lessor, it accounts for the head lease and the sublease as two separate contracts. The sublease is classified as a finance or operating lease by reference to the right-of-use asset arising from the head lease. Rental income from operating leases is recognised on a straight-line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight-line basis over the lease term. Amounts due from lessees under finance leases are recognised as receivables at the amount of the Group’s net investment in the leases. Finance lease income is allocated to accounting periods to reflect a constant periodic rate of return on the Group’s net investment outstanding in respect of the leases. When a contract includes lease and non-lease components, the Group applies IFRS 15 to allocate the consideration under the contract to each component.
2.9 INVESTMENT PROPERTIES Investment properties comprise land and buildings for rent and development projects (including land and building rights). Investment properties are initially recognised at cost and subsequently measured at fair value and changes in fair value are recognised in profit or loss in the period in which they occur. Fair value is the estimated value of the asset in a transaction between independent parties, without any deduction for transaction costs. Fair value represents an estimated gross sales value of the asset at the balance sheet date. Investment properties are valued twice a year by external appraisers who use a cash-flow based model in the calculation of fair value. For further details, see Note 5.3 and Note 11.1. Sale of subsidiaries where the main asset is an Investment Property is presented as gain (loss) on disposal of investment properties and equity investments sold. The gain (loss) is calculated as the fair value of the received payments reduced for the net book value of the assets and liabilities connected to the asset.
2.10 FINANCIAL ASSETS AND FINANCIAL LIABILITIES Financial assets and financial liabilities are recognised when the Group becomes a party to the contractual provisions of the instruments. Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and liabilities (other than financial assets and liabilities at fair value through profit or loss) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are recognised immediately in the income statement.
The Group classifies its financial assets in the following categories: at fair value through profit and loss and amortised cost.
(I) Financial assets at fair value through profit and loss A financial asset is classified in this category if it does not meet the conditions of SPPI (solely payments of principal and interest). Derivatives are by definition always at fair value over profit or loss (FVOPL) unless designated as a hedging instrument. Financial assets in this category are classified as current assets if expected to be settled within 12 months; otherwise, they are classified as non-current.
(II) Amortised cost All non-derivative financial assets held by the Group with fixed or determinable payments meet the SPPI criteria and have a business model of hold to collect. These financial assets are measured at amortised cost in the statement of financial position, and any interest income earned and impairment on the assets is recognised in the profit or loss statement. These financial assets are included in current assets, except for assets with maturities greater than 12 months after the end of the reporting period. These financial assets are classified as non-current assets.
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Financial assets at amortised cost are subsequently measured at amortised cost using the effective interest method, less any loss allowance. Interest income is recognised by applying the effective interest rate, except for short-term receivables when the effect of discounting is immaterial. The Group classifies its financial liabilities in the following categories: fair value through profit and loss and amortised cost. The Group derecognises financial liabilities when, and only when, the Group’s obligations are discharged, cancelled or expire. A substantial modification of the terms of an existing financial liability is accounted for as an extinguishment of the liability. The difference between the carrying amount of the financial liability and the consideration paid and payable is recognised in profit or loss at the date of de-recognition.
(I) Financial liabilities at fair value through profit or loss Financial liabilities are classified as at fair value through profit or loss when the financial liability is irrevocably designated at fair value to eliminate or reduce an accounting mismatch or when the financial liability (or group of liabilities) is managed and performance is evaluated on a fair value. Derivative instruments are subsequently measured at fair value, with any gains or losses arising on re-measurement recognised in other comprehensive income or through profit or loss if the requirements for hedge accounting is not met.
(II) Amortised cost Unless designated at fair value, financial liabilities are initially recognised at amortised cost. Financial liabilities (including borrowings and trade and other payables) are subsequently measured at amortised cost using the effective interest method.
2.11 IMPAIRMENT OF FINANCIAL ASSETS The Group has adopted the accounting policy to use the simplified approach for measuring expected credit losses (ECL) which uses a lifetime expected loss allowance for trade accounts receivable (lease receivables). To measure the expected credit losses, trade account receivables have been grouped based on shared credit risk characteristics and the days past due. Expected loss rates are based on payment profiles over a period of 36 months. Historical loss rates are adjusted to reflect current and forward- looking information on factors affecting the tenant’s ability to settle their liabilities. Such factors include the probability of bankruptcy and general market conditions for specific shopping centers.
2.12 EQUITY (I) Debt and equity Financial instruments are classified as debt or equity in accordance with the underlying economic reality and IFRS Accounting Standards requirements. Interest, dividends, gains and losses related to a financial instrument which is classified as debt are recognised as an expense or income. Payments to holders of the financial instruments which are classified as equity will be recognised directly through equity.
(II) Treasury shares Own equity instruments which are reacquired (treasury shares) are deducted from equity. No gains or losses are recognised in the income statement on the purchase, sale, issue or cancellation of the Company’s own equity instruments.
(III) Costs of equity transaction s Costs of equity transactions are recognised directly through equity (net of tax). Only transaction costs related to equity transactions are recognised in equity. (IV) Other equity (a) Reserve for exchange differences on translation of foreign operations (FX conversion reserves) Foreign currency exchange differences on translation of foreign operations occurs in connection with currency differences in the consolidation of foreign companies. At the disposal or sale of a foreign entity, the foreign currency translation differences related to the subsidiary are reversed and recognised in the consolidated statement of comprehensive income as in the same period as the recognition of the gain or loss related to the transaction. (b) Hedging reserves Hedging reserves is the total net change in fair value of the derivatives designated as instruments for a cash flow hedge, until the hedged cash flow occurs or is no longer expected to occur.
2.13 REVENUE RECOGNITION Revenues are recognised when it is probable that economic benefits from the transactions will flow to the Group, and the revenues can be reliably measured. Revenues are measured at the fair value of consideration received, net of discounts and sales related taxes. Rental income from investment properties is recognised using the straight-line method over the lease contracts’ firm periods. At termination of a lease, the tenant’s lease payment is recognised over the remaining lease term, or until the new tenant moves in. Income from rental agreement guarantees is treated the same way as terminations. In the event of the Company releasing a tenant from the lease contract, the costs are expensed immediately.
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Discounts cover abandoned rents and cash discounts granted during the lifetime of the lease contract. Discounts are either granted as an “introduction” discount upon the start of the contract, like an initial “rent free period” or stepped cash discounts, or it can be granted as a one shot, cash discount at any time during the contract duration. Discounts are presented according to IFRS 16 Leases, thus when discounts are exchanged for another “Lease modification”, i.e. prolongation of the contract period, discounts are straight-lined over the remaining duration of respective contracts. Other, exceptional discounts, without lease modification are expensed immediately. Interest income is recognised using the effective-interest method as it is earned. Dividends are recognised when the shareholder’s right to receive dividends is established by the General Assembly.
2.14 FOREIGN CURRENCY (I) Foreign currency transactions Transactions in foreign currency are initially recognised in the functional currency of the entity at the exchange rate at the date of the transaction. Monetary assets in foreign currencies are translated to the functional currency at the Group’s exchange rate at the reporting date. Non-monetary items that are measured at historical cost in foreign currency are translated using exchange rates at the dates of the initial transactions. Non-monetary items that are measured at fair value in foreign currency are translated using exchange rates determined on the fair value valuation date. All exchange gains or losses are recognised in profit or loss. (II) Foreign entities Assets and liabilities of foreign operations, including goodwill and fair value adjustments, arising on consolidation, are converted to the presentation currency (NOK) using the Group’s closing rate. Revenues and expenses of foreign operations are converted to the presentation currency using a weighted average exchange rate for the accounting period. Translation differences arising from translation of net investments in foreign operations are classified as exchange differences on translation of foreign operations and recognised as part of OCI. A foreign operations’ accumulated translation differences in OCI is recognised in profit or loss upon disposal of the foreign operation.
2.15 EMPLOYEE BENEFITS
(I) Pension obligations All employees of the Group are on defined contribution plans. For the defined contribution plans, the Group pays contributions to privately administered pension insurance plans on a mandatory, contractual or voluntary basis. The Group has no further payment obligation once the contributions have been paid. The contributions are recognised as employee benefit expense when due. Prepaid contributions are recognised as an asset to
the extent that a cash refund or a reduction in the future payments is available
.
(II) Incentive agreements with employees of the management team For the Group’s incentive agreements for employees of the management team, see note 10.
2.16 BORROWING COSTS Borrowing costs occur when interest costs accrue during the construction period of the asset. Borrowing costs are capitalised to the extent they are directly related to the purchase, construction or production of a fixed asset. Borrowing costs are capitalised up until the point in time when the asset is ready for use.
2.17 PROVISIONS Provisions for environmental restoration, restructuring costs and legal claims are recognised when the Group has a present legal or constructive obligation as a result of past events; it is probable that an outflow of resources will be required to settle the obligation; and the amount has been reliably estimated. Provisions are not recognised for future operating losses. Provisions are measured at the present value of the expenditures expected to be required to settle the obligation using a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the obligation.
2.18 INCOME TAXES Tax expense consists of tax payable and deferred tax. Tax is charged to the income statement, except where it relates to items that are recognised in comprehensive income or directly in equity. In such cases, the tax is either recognised in comprehensive income or directly in equity. Deferred tax is calculated using the liability method for all temporary differences between the tax values and consolidated accounting values of assets and liabilities. Deferred tax liabilities are not calculated and recognised upon initial recognition of assets or liabilities obtained through an acquisition of a subsidiary not classified as a business combination. Deferred tax is defined using tax rates and laws which are enacted or likely to be enacted on the balance sheet date, and which are expected to be used when the deferred tax asset is realised or when the deferred tax is utilised.
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Deferred tax is calculated and provided or reduced in the event of adjustments to the value of investment properties at the applicable nominal tax rate. A deferred tax asset is recognised to the extent that it is likely that future taxable profit will be available against, which the temporary differences can be offset. Deferred tax liabilities are recognised for taxable temporary differences associated with investments in subsidiaries and associates, except where the group is able to control the reversal of the temporary differences and it is probable that the temporary difference will not reverse in the foreseeable future.
2.19 STATEMENT OF CASH FLOWS The Group presents the statement of cash flows using the indirect method. Cash inflows and outflows are shown separately for investing and financing activities, while operating activities include both cash and non-cash line items. Dividends distributed to controlling parties outside of the Group are reported as a financing activity.
2.20 SEGMENT INFORMATION For internal management reporting purposes, the Group is organised into business segments and geographic regions. The management team monitors the operating results of each business segment independently as a basis for segment decision- making and performance evaluation. Financial information for the operating segments is presented in Note 3.
2.21 CONTINGENT LIABILITIES AND ASSETS Contingent liabilities are not recognised in the consolidated financial statements. Significant contingent liabilities, with the exception of contingent liabilities where the likelihood of a settlement is remote, are disclosed. A contingent asset is not recognised in the consolidated financial statements but disclosed if it likely that a benefit will accrue to the Group. Contingent liabilities acquired in a business combination are initially measured at fair value at the date of acquisition.
2.22 SUBSEQUENT EVENTS New information after the balance sheet date that affects the Group’s financial position at the balance sheet date is recognised in the financial statements. Subsequent events that do not affect the Company’s financial position at the balance sheet date, but which will affect the Group’s financial position in a subsequent period, are disclosed as subsequent events.
2.23 CRITICAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY The application of accounting policies requires that management makes estimates and judgments in determining certain revenues, expenses, assets, and liabilities. The principal assumptions made in respect of future events and other sources of uncertainty relating to the use of estimates for which there is a significant risk of material change to the net book values of assets and liabilities are presented below:
Fair value of investment properties Investment properties are measured at their fair value based on independent external valuations. Each half-year an independent external appraiser values the properties. The valuations at 31 December 2024 were performed by Cushman & Wakefield. The valuations are based on the discounted cash flow method, which involves discounting future cash flows over a specified period using an estimated discount rate and then adding a residual value at the end of the period (exit). Future cash flows are calculated on the basis of cash flows from signed leases, as well as future cash flows based on expected market rent at the end of the lease terms. The fair value of investment properties is therefore mainly affected by expected market rents, yield, discount rates and inflation. The market rent for each property takes into account the property’s situation, standard and leases signed for comparable properties in the area. The discount rate is based on interest on investments without risk and a mark-up based on an assessment of the risks related to the cash flows. Inflation is estimated using the consensus of a selection of banks and official statistics. When carrying out their valuations, the appraiser receives comprehensive details of the leases for the properties, floor space and details of any vacant premises, and up-to-date information about all ongoing projects. Any uncertainties relating to the properties/projects and leases are also clarified verbally and in writing when required. The Group management performs internal controls to ensure that all relevant information is included in the valuations. The appraiser performs the valuations on the basis of the information they have received, regularly scheduled on-site visits, and estimates of future market rents, yields, inflation and other relevant parameters. Each individual property is assessed in terms of its market position, rental income (contractual rents versus market rents) and ownership costs, with estimates being made for anticipated vacancy levels and the need for alterations and upgrades. The remaining term of the leases is also assessed for risk, along with any special clauses in the contracts. Each property is also compared with recently sold properties in the segment (location, type of property, mix of tenants etc.). For further information and details about valuation of investment properties, including main value drivers, sensitivities and estimation uncertainty, see Note 5.3c.
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Measurement of goodwill Goodwill in the Group consolidated financial statements arises from the acquisition of investment properties recognised as a business combination and is mainly related to the discount on deferred tax liabilities attached to the acquisition. Goodwill is assessed for impairment on an annual basis. 2.24 COMPARATIVE FIGURES The consolidated statements of profit or loss, comprehensive income, financial position, equity, cash flow and notes provide comparable information in respect of the previous year. The following changes have been made in comparative figures in the 2024 annual report: Due to a process discrepancy within the Swedish segment of the group, the group contribution from the Swedish entities to one of the group’s holdings, Nordica Holdco AB was not properly recognised in the year it was declared, starting from 2020. While the group contribution was appropriately reversed in line with the difference between IFRS and local GAAP, it was not recognised in the subsequent year when it was approved for “distribution”, as per IAS 10 requirements. Missing recognition of the approved distribution led to an accumulated misstatement between receivable/payable “group contribution” and “equity” of NOK 609.1 million end of 2023. As a result, the equity balance, deferred tax liability, and other liabilities as of 1 January 2023 have been restated, with a net impact on equity of NOK 453.2 million. The remaining amount has been implemented in “restated” 2023 figures, meaning comparative figures in the statement of financial position, statement of comprehensive income as well as related notes have been updated accordingly.
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3.1 ‐ SEGMENT INFORMATION Steen & Strøm is a Scandinavian shopping center company, with 9 leading centers located in the most attractive marketplaces in Denmark, Norway, and Sweden. For management purposes, the Group is structured into operating segments which are geographic regions. There are in total three operating segments. These three operating segments are structured as follows: — Denmark — Norway — Sweden The management team monitors the operating results of each business segment independently as a basis for segment decision- making and performance evaluation. Group financial policy (including the impact of financial income and expenses), corporate activities and tax result calculation are handled at Group level and are not allocated to the operating segments. In 2024 and 2023 Building- and payroll-expenses are netted, due to eliminations for internal services. 2024 In thousands of NOK Denmark Norway Sweden Total Gross rental income 686 613 233 958 651 573 1 572 145 Non-recovered rental expenses -70 681 -11 415 -60 979 -143 075 Building expenses (owner) -21 936 -1 041 -10 507 -33 484 Net rental income 593 997 221 502 580 087 1 395 586 Management, administrative and related income 23 006 25 931 26 408 75 345 Other operating revenue 1 791 6 074 1 010 8 875 Change in the fair value of investment properties 221 830 129 914 169 389 521 134 Payroll expenses -48 042 -14 230 -59 294 -121 565 Other general expenses -22 229 -29 838 -13 549 -65 616 Depreciation and impairment allowance on investment properties - -279 -9 -288 Depreciation and impairment allowance on intangible assets and furniture and equipment -1 018 -10 209 -3 775 -15 002 Proceeds from disposal of investment properties and equity investments - 127 478 079 478 206 Net book value of investment properties and equity investments sold - - -478 090 -478 090 Income from disposal of investment properties and equity investments - 127 -11 116 Operating income 769 335 328 992 700 257 1 798 584 Net dividends and provisions on non-consolidated investments 62 Financial income 332 255 Financial expenses -486 339 Net cost of debt -154 084 Change in the fair value of financial instruments -15 578 Share of earnings in equity investment entities -11 365 Profit before tax 1 617 619 Corporate income tax -407 974 Net income of consolidated group 1 209 645 Segment income statement
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3.2 - NET BOOK VALUE OF INVESTMENT PROPERTIES AND PROPERTIES UNDER CONSTRUCTION BY OPERATING SEGMENT
2023 In thousands of NOK Denmark Norway Sweden Total Gross rental income 656 494 232 020 630 768 1 519 283 Non-recovered rental expenses -77 679 -10 242 -70 964 -158 885 Building expenses (owner) 2 471 -4 957 -10 664 -13 150 Net rental income 581 287 216 821 549 140 1 347 247 Management, administrative and related income 21 789 23 830 20 933 66 552 Other operating revenue 1 912 4 127 7 769 13 808 Change in the fair value of investment properties -1 310 235 -343 150 128 950 -1 524 435 Payroll expenses -44 712 -19 140 -57 493 -121 345 Other general expenses -21 893 -29 372 -39 750 -91 015 Depreciation and impairment allowance on investment properties - -270 -0 -270 Depreciation and impairment allowance on intangible assets and furniture and equipment -1 015 -10 006 -1 -11 022 Proceeds from disposal of investment properties and equity investments - 3 822 60 091 63 913 Net book value of investment properties and equity investments sold - -8 838 -62 985 -71 823 Income from disposal of investment properties and equity investments - -5 016 -2 893 -7 909 Operating income -772 868 -162 176 606 655 -328 389 Net dividends and provisions on non-consolidated investments 48 Financial income 471 505 Financial expenses -623 175 Net cost of debt -151 670 Change in the fair value of financial instruments -1 517 Share of earnings in equity investment entities -40 112 Profit before tax -521 639 Corporate income tax 241 268 Net income of consolidated group -280 371
In thousands of NOK 31/12/2024 31/12/2023 Denmark 11 471 133 10 948 572 Norway 4 549 484 4 373 209 Sweden 10 266 411 9 882 049 Investment properties 26 287 027 25 203 830 In thousands of NOK 31/12/2024 31/12/2023 Denmark 683 685 775 078 Norway 41 883 50 620 Sweden 306 002 310 254 Investment properties under construction 1 031 570 1 135 953
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3.3 - AQUISITIONS BY OPERATING SEGMENT 2024 In thousands of NOK Intangible assets Furniture and equipment and work in progress Investment properties Investment properties under construction Total aquisitions Denmark - 1 082 - 54 218 55 300 Norway 8 080 1 182 760 37 440 47 462 Sweden - 13 203 529 44 210 57 942 Total 8 080 15 467 1 289 135 869 160 705 2023 In thousands of NOK Intangible assets Furniture and equipment and work in progress Investment properties Investment properties under construction Total aquisitions Denmark - 2 763 35 541 33 545 71 849 Norway 6 192 1 078 55 60 030 67 355 Sweden - - - 49 157 49 157 Total 6 192 3 841 35 596 142 732 188 361 2022 In thousands of NOK Intangible assets Furniture and equipment and work in progress Investment properties Investment properties under construction Total aquisitions Denmark - 687 - 24 823 25 511 Norway 8 248 17 219 7 712 57 116 90 295 Sweden - - - 27 991 27 991 Total 8 248 17 906 7 712 109 930 143 797
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4.1 ‐ SUBSIDIARIES Country Headquarter % of interest Full consolidated companies 31/12/2024 31/12/2023 Steen & Strøm AS Norway Oslo 100,0% 100,0% Bruun's Galleri A/S Denmark Copenhagen 100,0% 100,0% Bryggen, Vejle A/S Denmark Copenhagen 100,0% 100,0% Field's A/S Denmark Copenhagen 100,0% 100,0% Steen & Strøm CenterService A/S Denmark Copenhagen 100,0% 100,0% Steen & Strøm CenterUdvikling VI A/S Denmark Copenhagen 100,0% 100,0% Steen & Strøm Danmark A/S Denmark Copenhagen 100,0% 100,0% Viva, Odense A/S Denmark Copenhagen 100,0% 100,0% Oslo City Kjøpesenter AS Norway Oslo 100,0% 100,0% Oslo City Parkering AS Norway Oslo 100,0% 100,0% Steen & Strøm Mediapartner Norge AS Norway Oslo 100,0% 100,0% Steen & Strøm Senterservice AS Norway Oslo 100,0% 100,0% FAB Allum Sweden Stockholm 100,0% 100,0% FAB Borlange Köpcentrum Sweden Stockholm 100,0% 100,0% FAB Centrum Västerort Sweden Stockholm 100,0% 100,0% FAB CentrumInvest Sweden Stockholm 100,0% 100,0% FAB Emporia Sweden Stockholm 100,0% 100,0% FAB Marieberg Galleria Sweden Stockholm 100,0% 100,0% FAB P Åkanten Sweden Stockholm 100,0% 100,0% FAB P Brodalen Sweden Stockholm 100,0% 100,0% FAB P Porthälla Sweden Stockholm 100,0% 100,0% Partille Lexby AB Sweden Stockholm 100,0% 100,0% Steen & Ström Holding AB Sweden Stockholm 100,0% 100,0% Steen & Ström Sverige AB Sweden Stockholm 100,0% 100,0%
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4.2 - GOODWILL After the recognition of Oslo City Kjøpesenter AS and Oslo City Parkering AS in 2016 as fully consolidated subsidiaries of Steen & Strøm AS there has been no further business combinations. The goodwill of NOK 348,4 million consists mainly of the discounted value of deferred tax liabilities in the purchase price. Goodwill is allocated to the following cash‐generating units (CGU): As the total estimated sales value exceeds the book value of subsidiaries, goodwill is not impaired. Sales value approach The best estimate of the investment properties sales value is the bi‐annual valuation, which in turn equals carrying value. Cash and working capital (such as account receivables, payables etc.) are in general valued at nominal value in a sale transaction. As cash and working capital are recorded at nominal value, carrying value is assumed to approximate the sales value. The deferred tax balance is currently estimated to be discounted at a value of 10% of the temporary difference between the property sales value and tax value. The deferred tax balance is currently recognized at 22% of the temporary difference between carrying value (equal to the fair value) and tax value. As carrying value equals sales value for all assets and liabilities except the deferred tax balance, it is only required to estimate the gain to be received from the discount applied to the deferred tax balance. If the estimated discount is greater than the carrying value of the goodwill, it is assumed that the goodwill balance is not impaired.
5.1 - INTANGIBLE ASSETS Intangible assets consist of software. Depreciation on software is calculated using the straight‐line method to allocate the cost to their residual values over their estimated useful life. Useful life is defined to be eight years for software.
Oslo City Kjøpesenter AS Oslo City Parkering AS Total Goodwill 332 518 15 907 348 425 Total estimated sales value CGU 4 393 754 205 590 4 599 344 Total Group book value equity CGU 4 236 433 198 446 4 434 879
In thousands of NOK 31/12/2023 Acquisitions Amortization and impairment allowances 31/12/2024 Total gross value 211 941 8 080 - 220 021 Amortization and impairment allowances -191 169 - -5 485 -196 654 Total amortization and impairment allowances -191 169 - -5 485 -196 654 Intangible assets - Net value 20 772 8 080 -5 485 23 367 In thousands of NOK
31/12/2022 Acquisitions Amortization and impairment allowances 31/12/2023 Total gross value 205 749 6 192 - 211 941 Amortization and impairment allowances -185 512 - -5 657 -191 169 Total amortization and impairment allowances -185 512 - -5 657 -191 169 Intangible assets - Net value 20 237 6 192 -5 657 20 772
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5.2 ‐ FURNITURE AND EQUIPMENT Furniture and equipment consist of vehicles/machines and furniture/fittings/equipment. Depreciation on furniture and equipment is calculated using the straight‐line method to allocate the cost to their residual values over their estimated useful life. Useful life is defined to be 3‐5 years for vehicles/machines and 5 years for furniture/fittings/equipment. In thousands of NOK 31/12/2023 Acquisitions Disposals and retirement of assets Depreciation and impairment allowances Currency fluctuations 31/12/2024 Furniture and equipment 87 484 984 -192 - 1 666 90 475 Right-of-use assets 32 656 14 483 -19 246 - 246 28 139 Total gross value 120 139 15 467 -19 438 - 1 911 118 614 Depreciation and impairment allowances furniture and equipment -73 808 - 192 -1 206 -1 408 -76 232 Depreciation and impairment allowances right-of-use assets -18 446 - 13 257 -8 310 -142 -13 641 Total depreciation and impairment -92 254 - 13 449 -9 517 -1 550 -89 873 Furniture and equipment - Net value 27 885 15 467 -5 989 -9 517 362 28 740 In thousands of NOK 31/12/2022 Acquisitions Disposals and retirement of assets Depreciation and impairment allowances Currency fluctuations 31/12/2023 Furniture and equipment 81 323 2 486 -501 - 4 176 87 484 Right-of-use assets 31 100 1 356 -833 - 1 033 32 656 Total gross value 112 423 3 842 -1 334 - 5 209 120 140 Depreciation and impairment allowances furniture and equipment -69 868 - 500 -917 -3 523 -73 808 Depreciation and impairment allowances right-of-use assets -13 971 - 833 -4 448 -860 -18 446 Total depreciation and impairment -83 839 - 1 333 -5 365 -4 383 -92 254 Furniture and equipment - Net value 28 584 3 842 -1 -5 365 826 27 886
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5.3A ‐ INVESTMENT PROPERTIES Other movements consist of investment properties transferred from investment properties under construction, see Note 5.3b Investment properties under construction and reclassification to Investment properties held for sale (see further comments below under Investment properties held for sale). Investment properties held for sale: Steen & Strøm has agreed to sell its subsidiary VIVA Odense A/S, holding a development plot in the inner city of Odense, with effect from 28 February 2025. The carrying amount 31 December 2024 of NOK 419.1 million is equal to the agreed sales price for the asset and is classified as a separate line item within current assets (Investment properties held for sale) in the consolidated statement of financial position. Investment properties held for sale: The subsidiary FAB Centrum Västerort has agreed to sell its shopping center Galleria Boulevard. The sale is structured as a sale of assets. The sale of Galleria Boulevard was finally closed and the proceeds from the sale was received during first quarter of 2024. The carrying amount 31 December 2023 of NOK 475.8 million is equal to the agreed sales price (deducted for transaction costs) and is classified as a separate line item within current assets (Investment properties held for sale) in the consolidated statement of financial position. 5.3B ‐ INVESTMENT PROPERTIES UNDER CONSTRUCTION Other movements consist of investment properties under construction transferred to investment properties and investment properties held for sale, see Note 5.3a Investment properties. In thousands of NOK 31/12/2023 Acquisitions Disposals and retirement of assets Depreciation and impairment allowances Currency fluctuations Fair value adjustments Other movements 31/12/2024 Shopping centers Land 2 340 126 - - - 47 597 - - 2 387 723 Structures 12 671 411 - - -288 350 815 - - 13 021 939 Facades, cladding and roofing 228 261 - - - 3 078 - - 231 339 General and technical installations 1 769 663 - - - 66 577 - 74 264 1 910 505 Fixtures 1 246 551 529 - - 43 521 - 59 859 1 350 460 Right-of-use assets 417 505 760 - - 20 163 -3 047 - 435 381 Cost value 18 673 518 1 289 - -288 531 752 -3 047 134 123 19 337 347 Fair value adjustments 6 530 311 - - - 162 317 497 151 -240 098 6 949 681 Fair value shopping centers 25 203 829 1 289 - -288 694 068 494 104 -105 975 26 287 027 In thousands of NOK 31/12/2022 Acquisitions Disposals and retirement of assets Depreciation and impairment allowances Currency fluctuations Fair value adjustments Other movements 31/12/2023 Shopping centers Land 2 312 232 - - - 80 767 - -52 873 2 340 126 Structures 12 767 840 - - -270 718 158 - -814 317 12 671 411 Facades, cladding and roofing 255 075 - - - 14 880 - -41 694 228 261 General and technical installations 1 655 225 78 - - 107 520 - 6 841 1 769 663 Fixtures 1 141 433 55 -181 254 - 78 252 - 208 064 1 246 551 Right-of-use assets 361 632 35 463 - - 23 379 -2 968 - 417 505 Cost value 18 493 436 35 596 -181 254 -270 1 022 957 -2 968 -693 979 18 673 518 Fair value adjustments 6 774 747 - 121 088 - 413 253 -1 338 883 560 107 6 530 311 Fair value shopping centers 25 268 183 35 596 -60 166 -270 1 436 210 -1 341 851 -133 873 25 203 829 In thousands of NOK 31/12/2023 Acquisitions Disposals and retirement of assets Currency fluctuations Fair value adjustments Other movements 31/12/2024 Investment properties under construction 1 135 953 135 869 -1 055 40 748 27 030 -306 974 1 031 570 In thousands of NOK 31/12/2022 Acquisitions Disposals and retirement of assets Currency fluctuations Fair value adjustments Other movements 31/12/2023 Investment properties under construction 1 372 488 142 732 -147 90 647 -182 584 -287 183 1 135 953
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5.3C ‐SENSITIVITY AND ESTIMATION UNCERTAINTY The value of investment properties corresponds to the following average net initial yields: The central banks in Sweden and Denmark have decreased the interest rates during 2024 as a result of stabilized inflation and less uncertainty in the economy, while in Norway, the interest rate has remained flat as a consequence of the weak NOK. The lower / stabilized interest rates have as a consequence decreased respective cap rate requirements. For the Norwegian portfolio, only Oslo City is considered in the average yields. There are four assets in the Swedish portfolio (Galleria Boulevard was divested at the beginning of the year), of which Emporia has the lowest NIY at 5,09%, while Kupolen has the highest NIY at 6,75%. The Danish portfolio consists of three assets, of which Bryggen has the lowest NIY at 4,65%, while Field's has the highest NIY at 4,95%. Sensitivities yield The following table shows the sensitivity in fair value of investment properties and property under construction as a result of change in yield: Sensitivities cash flows The following table show sensitivity in fair value of investment properties and property under construction as a result of change in cash-flow: Sensitivities discount rate The following table show sensitivity in fair value of investment properties and property under construction as a result of change in discount rate: Average yields (%) 31/12/2024 31/12/2023 Norwegian investment properties 4,59 % 4,69 % Swedish investment properties 5,65 % 5,68 % Danish investment properties 4,92 % 4,67 % Weighted average 5,06 % 5,08 % In thousands of NOK Yield Value Change Reduced yield by -0,5% -0,5% 30 316 900 2 998 302 Fair value 31/12/2024 0,0% 27 318 598 - Increased yield by 0,5% 0,5% 24 859 978 -2 458 620 In thousands of NOK Cash flow Value Change Increased cash-flow by 1% 1,0% 27 591 784 273 186 Fair value 31/12/2024 0,0% 27 318 598 - Reduced cash-flow by 1% -1,0% 27 045 412 -273 186 In thousands of NOK Discount rate Value Change Increased discount rate by 100 bps +100 bps 24 820 552 -1 773 596 Increased discount rate by 50 bps +50 bps 25 688 455 -907 173 Increased discount rate by 25 bps +25 bps 26 137 580 -458 815 Market value 31/12/2024 0 bps 26 597 179 - Reduced discount rate by 25 bps -25 bps 27 067 533 469 551 Reduced discount rate by 50 bps -50 bps 27 548 927 950 124 Reduced discount rate by 100 bps -100 bps 28 546 035 1 945 528
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Sensitivities exit cap rate The following table show sensitivity in fair value of investment properties and property under construction as a result of change in exit cap rate: There are no significant contractual commitments to purchase, construct or develop investment properties. Estimation uncertainty The key components in valuation estimates are the evolution in cash flow, thus rents and net initial yields. Our external appraisers have applied the same methodology across our portfolio, but different assessments, namely on the anticipated need for temporary discounts and the pace of leasing activities, depending on the retail climate in each country or region. The common approach in all three countries, to account for the above-mentioned uncertainties, is to adjust discount rates accordingly. We continue to observe macroeconomic uncertainties, driven by international conflicts, however, inflation has stabilised, and interest rates are decreasing, thus influencing cap rates. The "slowdown" experienced in 2023 has improved and the market has shown stronger performance, resulting in a positive impact on our investment properties. Increased attention towards climate impact and social responsibility can potentially impact our image and sustainability, and thus the net initial yields. It is difficult to quantify the impact, but it influences the status and attractiveness of our malls, hence our leasing activity and subsequently our cash flow. ESG comprise important focus areas for Steen & Strøm, and forementioned certifications and ratings, i.e., GRESB is confirming our claimed pursuit of excellence on both areas. The previous increase in energy prices has stabilized, even though the levels are higher than normal. This has to a certain extent a potential impact on our cash flow, should current levels persist. On the short term, Steen & Strøm and our tenants are “shielded” by electricity hedging (see note 8 - Exposure to risk). Ongoing construction contracts At 31 December 2024 the Group has a planned refurbishment of Allum in 2025 in the size of SEK ~60m.
5.4A ‐ INVESTMENTS IN JOINTLY CONTROLLED COMPANIES
In thousands of NOK Exit rate Value Change Increased exit rate by 100 bps +100 bps 24 243 549 -2 349 785 Increased exit rate by 50 bps +50 bps 25 322 155 -1 272 944 Increased exit rate by 25 bps +25 bps 25 931 881 -664 214 Market value 31/12/2024 0 bps 26 597 179 - Reduced exit rate by 25 bps -25 bps 27 326 090 727 726 Reduced exit rate by 50 bps -50 bps 28 128 297 1 528 632 Reduced exit rate by 100 bps -100 bps 30 002 395 3 399 702
In thousands of NOK 31/12/2023 Share of net income Dividends received Capital increases and reductions 31/12/2024 Investments in jointly controlled companies 1 790 398 -11 365 -35 000 80 1 744 134 Equity method securities 1 790 398 -11 365 -35 000 80 1 744 134 In thousands of NOK 31/12/2022 Share of net income Dividends received Capital increases and reductions 31/12/2023 Investments in jointly controlled companies 1 850 510 -40 112 -35 000 15 000 1 790 398 Equity method securities 1 850 510 -40 112 -35 000 15 000 1 790 398 Equity Method Companies: jointly controlled Country Headquarter % of interest 31/12/2024 31/12/2023 Nordal ANS Norway Oslo 0,0% 50,0% Økern Sentrum AS Norway Oslo 50,0% 50,0% Økern Eiendom ANS Norway Oslo 0,0% 50,0% Økern Sentrum ANS Norway Oslo 50,0% 50,0% Metro Shopping AS Norway Oslo 50,0% 50,0% Metro Senter ANS Norway Oslo 50,0% 50,0% Ny Økern Sentrum AS Norway Oslo 50,0% 0,0% Økern Sentrum Eiendom AS Norway Oslo 50,0% 0,0%
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5.4B - EQUITY METHOD ‐ STATEMENT OF COMPREHENSIVE INCOME 5.4C - EQUITY METHOD ‐ STATEMENT OF FINANCIAL POSITION 2024 2023 In thousands of NOK 100 % Group share 100 % Group share Gross rental income 129 908 64 954 133 248 66 624 Non-recovered rental expenses -24 817 -12 409 -20 206 -10 103 Building expenses (owner) -13 421 -6 711 -8 010 -4 005 Net rental income 91 670 45 835 105 032 52 516 Other operating revenue 30 15 30 15 Change in the fair value of investment properties -125 135 -62 568 -191 679 -95 840 Other general expenses -248 -124 -349 -175 Income from disposal of investment properties and equity investments -69 -35 500 250 Operating income -33 752 -16 876 -86 458 -43 229 Financial income 4 690 2 345 4 100 2 050 Financial expenses -105 -53 -142 -71 Net cost of debt 4 585 2 293 3 958 1 979 Profit before tax -29 167 -14 584 -82 500 -41 250 Corporate income tax 6 438 3 219 2 277 1 139 Share of earnings in equity investment entities -22 729 -11 365 -80 223 -40 112 31/12/2024 31/12/2023 In thousands of NOK 100 % Group share 100 % Group share Furniture and equipment and work in progress - - - - Investment properties and properties under construction 3 728 316 1 864 158 3 786 293 1 893 147 Deferred tax assets - - - - Non-current assets 3 728 419 1 864 210 3 786 293 1 893 147 Trade accounts and notes receivable 9 367 4 684 5 143 2 572 Other receivables 10 406 5 203 10 758 5 379 Cash and cash equivalents 112 527 56 264 80 001 40 001 Current assets 132 300 66 150 95 902 47 951 Total assets 3 860 719 1 930 360 3 882 195 1 941 098 Share capital 1 555 562 777 781 1 555 502 777 751 Additional paid-in capital 1 957 979 1 857 929 Consolidated reserves 1 953 478 976 739 2 103 660 1 051 830 Other consolidated reserves 1 953 478 976 739 2 103 660 1 051 830 Consolidated earnings -22 729 -11 365 -80 223 -40 112 Shareholders’ equity, group share 3 488 268 1 744 134 3 580 796 1 790 398 Shareholders’ equity 3 488 268 1 744 134 3 580 796 1 790 398 Deferred tax liabilities 278 722 139 361 285 160 142 580 Non-current liabilities 279 633 139 817 285 649 142 825 Trade payables 15 497 7 749 7 853 3 927 Other liabilities 76 812 38 406 6 496 3 248 Social and tax liabilities 509 255 1 401 701 Currrent liabilities 92 818 46 409 15 750 7 875 Total shareholders’ equity and liabilities 3 860 719 1 930 360 3 882 195 1 941 098
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5.5 ‐ OTHER NON‐CURRENT ASSETS
5.6 ‐ TRADE RECEIVABLES The trade receivables are spread across several shopping centers throughout Scandinavia (Norway, Sweden and Denmark). There is no one single customer who represents a significant share of the trade receivables. The majority of the Group's rental contracts have deposit and bank guarantees which secure up to 3 to 6 month's rent, including the outstanding trade receivables.
Credit risk Credit risk is assessed for in accordance with IFRS 9. The credit risk assessment is conducted differently for forced closure periods and for open periods. The main rules applied are detailed below: 1) Specific tenants at risk: a) Receivables related to insolvent or bankrupt tenants are 100% provisioned, after deducting security deposits (not bank guarantees). b) For businesses heavily impacted by forced closure periods, the related receivables are 100% provisioned after deducting security deposits (not bank guarantees). 2) Forced closure periods: a) The outstanding receivables (after deduction of abatements granted or to be granted) are provisioned based on a tenant‐ by‐tenant assessment of solvency profiles. Where there is an agreement for abatement, the outstanding amount net of abatements is maintained in receivables (no allowance and with some use of security deposits), as we consider that the outstanding receivable will be collected further to the rent abatement to be granted. b) These rules do not apply to receivables with the most heavily impacted businesses, which are 100% provisioned with some deducting of security deposits, as described above. 1) Open period: a) Where an abatement agreement has been signed, agreed or expected, uncollected rents are maintained in receivables, with or with deduction of security deposits (depending on the quarter and type of security). b) Where no abatement agreement has been signed, agreed or expected, the outstanding amounts to be collected are assessed on a tenant‐by‐tenant basis taking into account the tenant’s solvency profile. Tenants are analysed using different parameters such as the occupancy cost ratio. Therefore, different levels of allowance are defined, from 0% or 100%.
In thousands of NOK 31/12/2024 31/12/2023 Other long term investments 3 323 3 230 Deposits 2 931 3 241 Total 6 254 6 471
In thousands of NOK 31/12/2024 31/12/2023 Trade receivables 117 448 95 233 Stepped rents and rent-free periods of leases 60 914 70 398 Gross Value 178 362 165 631 Loss allowance -32 346 -39 622 Net value 146 016 126 010
Trade receivables aging and loss allowance In thousands of NOK Total Not due < 3 Months 3-6 Months > 6 Months Trade receivables, gross as of 31/12/2024 178 362 132 335 19 994 645 25 388 Loss allowance -32 346 - -6 313 -645 -25 388 Trade receivables, net as of 31/12/2024 146 016 132 335 13 681 - - Trade receivables, gross as of 31/12/2023 165 631 113 983 27 168 4 195 20 286 Loss allowance -39 622 - -15 140 -4 195 -20 287 Trade receivables, net as of 31/12/2023 126 010 113 983 12 027 -0 0 In thousands of NOK 2024 2023 Opening balance loss allowance -39 622 -52 550 Increase in loss allowance recognised in the profit and loss during the period -7 954 -5 105 Impairment losses on trade receibavles 7 390 16 777 Reversal of previously impairment losses 9 111 4 376 Foreign exchange effects -1 270 -3 120 Closing balance -32 346 -39 622
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5.7 ‐ OTHER RECEIVABLES The item Other consists of various items incl. receivables related to gift cards, receivable dividends from Joint ventures and advances received from tenants.
5.8 ‐ CASH AND CASH EQUIVALENTS In 2023 the group has implemented a group account scheme for bank accounts in Norway, Denmark and Sweden. The owner of the Scandinavian group account scheme is Steen & Strøm AS and the scheme is covering all fully owned companies. The group also maintain a group account scheme for bank accounts in Norway, which is linked to the group's overdraft accounts. At 31 December 2024 and 2023, the group held a total bank credit facility available of NOK 1 970 million and NOK 1 970 million, respectively.
Restricted bank deposits At 31 December 2024 and 2023, restricted funds amounted to NOK 3.1 million and NOK 2.2 million, respectively.
5.9 ‐ SHAREHOLDERS' EQUITY Share capital At 31 December 2024, the share capital of the Company was NOK 73 258 653, divided into 29 303 461 shares at par value NOK 2,50. Shareholders At 31 December 2024 and 2023, 100% of the shares in the Company were held by Storm Holding Norway AS. Storm Holding Norway AS is 100% owned by Nordica HoldCo AB, which in turn is owned 56.1% by Klèpierre Nordica BV, corporate identity number 34261791 with headquarters in Amsterdam, Holland and 43.9% by Storm ABP Holding BV, corporate identity number 34313617, with headquarters in Schipol, Holland.
In thousands of NOK 31/12/2024 31/12/2023 Tax receivables 110 458 102 244 - Corporate income tax 21 944 38 044 - VAT 88 514 64 199 Other receivables 302 013 172 822 - Service charges due 25 691 19 698 - Supplier advances and down payments made - 3 317 - Prepaid expenses 3 850 4 401 - Other 272 471 145 407 Total 412 471 275 066
In thousands of NOK 31/12/2024 31/12/2023 Bank 701 233 598 256 Treasury instruments - - Gross cash and cash equivalents 701 233 598 256 - Bank overdrafts -0 0 Net cash and cash equivalents 701 233 598 256
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5.10 ‐ NON‐CURRENT AND CURRENT FINANCIAL LIABILITIES *Bonds are listed on the Oslo Stock Exchange. **Loans and borrowings from credit institutions consist of mortgaged loans, related to the Group's investment property in Denmark/Sweden, granted by Nordic financial institutions. The mortgaged loans in Sweden has an average duration of 15.1 years, while in Denmark 13.8 years. *** Commercial papers are short‐term certificates issued by Nordic banks. The duration of the certificates is below 12 months. Information about interest‐rate and hedge agreements is provided in Note 8. Contractual payment* of liabilities *Expected future interest payments is included in contractual payment of liabilities. Expected future interest payments is calculated based on the forward interests and spreads (fixed rate if applicable) for the liabilities in each country. Foreign exchange rates at 31/12/2024 are used in the calculations. Certain loans are secured by pledge in certain assets. Pledged assets are specified in the table below: The total mortgage amount of the pledged assets amounts to NOK 9 597 million. In thousands of NOK Opening Balance 01/01/2024 Cash flow Reclassification Non Current to Current Foreign exchange movement Closing Balance 31/12/2024 Non-current financial liabilities Bonds net costs/premium* 100 000 - - - 100 000 Loans and borrowings from credit institutions - more than one year** 6 101 211 368 830 - 215 561 6 685 602 Other loans 6 939 24 207 - - 31 146 Non-current lease liabilities (Note 9) 423 985 4 888 -8 060 20 124 440 938 Non-current derivatives (Note 8) 14 533 -7 132 -933 190 6 658 Total non-current financial liabilities 6 646 667 390 793 -8 992 235 875 7 264 343 Current financial liabilities Bonds net costs/premium* 400 000 -400 000 - - - Loans and borrowings from credit institutions - less than one year** 742 578 -570 264 - 27 040 199 354 Accrued interest 12 405 -11 532 933 1 326 3 131 Commercial papers*** - - - - - Current lease liabilities (Note 9) 7 802 -6 931 8 060 144 9 074 Current derivatives (Note 8) - - - - - Total current financial liabilities 1 162 784 -988 727 8 993 28 509 211 559 Total non-current and current financial liabilities 7 809 451 -597 934 0 264 385 7 475 902 In thousands of NOK Opening Balance 01/01/2024 Cash flow Reclassification Non Current to Current Foreign exchange movement Closing Balance 31/12/2024 NOK 525 494 -424 870 - 43 894 144 518 SEK 2 700 365 -18 223 - 43 232 2 725 373 DKK 4 583 592 -154 841 - 177 259 4 606 011 Total non-current and current financial liabilities 7 809 451 -597 934 - 264 385 7 475 902 In thousands of NOK 31/12/2024 31/12/2023 0 - 1 years 371 047 1 318 960 2 - 5 years 1 640 436 1 517 959 More than 5 years 8 767 725 7 291 587 Total non-current and current financial liabilities 10 779 208 10 128 506 In thousands of NOK 31/12/2024 31/12/2023 Investment properties and properties under construction 25 251 330 23 946 070 Total carrying value of pledged assets 25 251 330 23 946 070
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5.11 ‐ SOCIAL AND TAX LIABILITIES AND OTHER LIABILITIES
5.12 - GUARANTEES, BAIL DECLARATIONS AND PLEDGES The Group has given the following guarantees, bail declarations and pledges: Loan covenants Certain loan agreements contain financial covenants. With regard to such covenants, Steen & Strøm AS has to maintain a minimum book equity ratio of 20%. Some subsidiaries have loan agreements with LTV (loan to value) covenants. Loan to value expresses the ratio of net interest- bearing debt to the value of the investment property. The covenants on these loans require the LTV to be below 60% or 40%. Furthermore, certain loan agreements contain a change of control event provision being triggered should the Klèpierre Group cease to own (directly or indirectly) 50% of the shares in Steen & Strøm AS. The Steen & Strøm Group was in compliance with its loan covenants 31 December 2024.
6.1 ‐ INCOME FROM DISPOSAL OF INVESTMENT PROPERTIES AND EQUITY INSTRUMENTS In 2024 Steen & Strøm sold the shopping center Galleria Boulevard (“Kristianstad Domus 2”) to the company Specialfastigheter i Kristianstad AB (owned by Kristianstad municipality) for a purchase price/property value of SEK 470 million. In 2023 Steen & Strøm AS sold Block-C at Galleria Boulevard. The sales proceed amounted to NOK 60 million. Proceeds from disposal and net book value as stated above also include final pro & contra from the sales conducted in 2022.
In thousands of NOK 31/12/2024 31/12/2023 Social and tax liabilities Staff and related accounts 26 214 20 285 Social security and other bodies 4 452 7 298 - Corporate income tax 497 928 134 300 - VAT 27 726 18 385 Other taxes and duties 51 272 54 192 Total social and tax liabilities 607 593 234 461 Other liabilities Creditor customers 127 179 141 278 Prepaid gift cards 32 351 29 097 Other liabilities 35 995 834 960 Total other liabilities 195 525 1 005 335
In thousands of NOK Banking partner 31/12/2024 31/12/2023 Bail declaration - surety for indemnity declaration previous tenants Nordea Bank AB, Norwegian branch 2 147 2 147 Pledges secured in investment property of subsidiaries Different partners 9 597 100 9 961 695 9 599 247 9 963 842 Total off-balance sheet commitments of guarantees, bail declarations and pledges
In thousands of NOK 2024 Proceeds from disposal of investment properties and equity investments 478 206 Net book value of investment properties and equity investments sold -478 090 116 Income from disposal of investment properties and equity investments In thousands of NOK 2023 Proceeds from disposal of investment properties and equity investments 63 913 Net book value of investment properties and equity investments sold -71 823 -7 909 Income from disposal of investment properties and equity investments
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6.2 ‐ NET COST OF DEBT Net cost of debt includes net foreign exchange loss of NOK - 8.2 million and gain of NOK 76.9 million in 2024 and 2023, respectively. Financial expenses include interest on external bonds, certificates and bank loans.
7 - TAX Non-taxable elements in mainly related to sale of shares and investment properties.
In thousands of NOK 2024 2023 Financial income Interest income on swaps 219 938 173 400 Proceeds from divestment of swaps - 65 599 Interest on associates’ advances 1 3 Other interest received 737 1 035 Other revenue and financial income 2 3 575 Foreign exchange gains 111 577 227 894 Financial income 332 255 471 505 Financial expenses Interest on bonds -32 483 -41 280 Interest on loans from credit institutions (incl. certificates) -274 786 -255 423 Interest expense on swaps -60 720 -32 351 Deferral of payments on swaps 945 -103 889 Interest on associates’ advances - -1 Other financial expenses 9 343 -30 599 Foreign exchange losses -119 820 -151 003 Interest on lease liabilities -8 818 -8 629 Financial expenses -486 339 -623 175 Net cost of debt -154 084 -151 670
In thousands of NOK 2024 2023 Corporate income tax Current Tax -82 518 30 455 Change in deferred tax -325 457 210 813 Corporate income tax -407 974 241 268 Profit before tax 1 617 619 -521 639 Tax calculated on profit before tax -344 982 123 403 Tax on group contribution given to parent company 45 369 56 670 Taxes without bases in taxable income current period -5 551 -7 583 Non taxable elements -102 885 21 816 Other 75 46 962 Corporate income tax -407 974 241 268 Effective tax rate 25,2% 46,3%
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The OESD/G20 Inclusive Framework on Base Erosion and Profit Shifting has published the Pillar Two model rules designed to address the tax challenges arising from the digitalisation of the global economy. It is unclear if the Pillar Two model rules create additional temporary differences, whether to remeasure deferred taxes for the Pillar Two model rules and which tax rate to use to measure deferred taxes. In response to this uncertainty, on 23 May 2023 and 27 June 2023, respectively, the IASB and AASB issued amendments to IAS 12 "Income taxes" introducing a mandatory temporary exception to the requirements of IAS 12 under which a company does not recognise or disclose information about deferred tax assets and liabilities related to the proposed OESD/G20 BEPS Pillar Two model rules. The Group applied the temporary exception at 20 June 2023.
8 ‐ EXPOSURE TO RISK The procedures for managing risk are approved by the Board of Directors. Interest-rate risk Interest rate risk arises in the short and medium term, following the part of the Company's debt which has a floating interest rate. The loan portfolio currently has a combination of floating and fixed rates, where long- term rent agreements have been made for approximately 80% of the Group's loan portfolio. The Group uses various types of interest rate derivatives to hedge against fluctuations due to changes in interest rate levels. As of 31 December 2024 and 2023, the Group had interest-rate hedges at nominal value NOK 6 500 million and NOK 6 403 million, respectively. The interest rate swaps are used to hedge against fluctuations due to changes in the level of interest rates. The secured loans and the swap agreements have the same terms and conditions. For the swaps that's satisfy the requirements for hedge accounting under IFRS 9, changes in fair value are recognized directly through other comprehensive income (OCI).
Deferred tax assets In thousands of NOK 31/12/2024 31/12/2023 Tangible fixed assets and investment property - 146 735 Losses carried forward 8 205 2 425 Total for entities in a net asset position 8 205 149 160 Deferred tax liabilities Tangible fixed assets and investment property 4 042 523 3 739 251 Losses carried forward - - Derivatives 11 065 12 246 Long-term liabilities and receivables - -162 657 Capital losses carried forward/capital gain pending taxation 712 890 Other 4 127 197 051 Total for entities in a net liability position 4 058 427 3 786 782 NET POSITIONS 4 050 222 3 637 622 Summary of losses carried forward No due date 58 770 52 718 Total losses carried forward 58 770 52 718 Losses carried forward is related to the Group's operations in Sweden. Change in deferred tax recognized in other comprehensive income Cash flow hedges ex translation profits and losses -4 372 -24 537 Translation profits and losses cash flow hedges -33 1 125 Total deferred tax recognized in other comprehensive income -4 405 -23 411
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Overview of the Group's hedge agreements: Average rate on interest-bearing loans in 2024 and 2023 was 2.2% and 2.1%, respectively. Based on the financial instruments and interest rate swaps as of 31 December 2024, a general increase of 1% in interest rate levels will reduce profits by approximately NOK 4.7 million. The Group recognized a loss through income statement of NOK 15.6 million on interest-rate hedging in 2024 (loss of NOK 1.5 million in 2023). Other movements in interest rate hedging that are not recognized through the income statement are itemized in other comprehensive income. Liquidity risk The Group's strategy is to, at all times, have sufficient cash and cash equivalents or credit facilities to be able to finance operations and investments for the next three years, in accordance with the Company's strategic plan for the same period. See Note 5.8 Cash and cash equivalents. At 31 December 2024, the Group held a total bank credit facility available of NOK 1 970 million. See note 5.10 for further details regarding financial liabilities. Currency risk Changes in exchange rates involve both direct and indirect financial risk for the Group. The currency exposure is mainly limited to the equity portion of shopping center investments in Sweden and Denmark. Hedging is achieved by having assets and liabilities in the same currency. Start Date End Date Amount Currency Int. rate Excess value (thousand NOK) 29.09.2023 29.09.2028 400 000 000 SEK 1,9450 % 6 654 29.09.2023 28.09.2029 200 000 000 SEK 2,0670 % 3 451 30.10.2020 29.10.2027 100 000 000 SEK 0,1880 % 6 171 30.03.2021 30.09.2027 300 000 000 SEK 0,1930 % 17 939 30.12.2021 30.12.2026 200 000 000 SEK 0,3190 % 8 154 30.06.2022 30.06.2027 300 000 000 SEK 0,3910 % 14 771 03.04.2023 29.12.2028 300 000 000 SEK 2,6515 % -2 987 30.12.2024 30.12.2031 375 000 000 SEK 2,3310 % 5 250 03.07.2023 30.12.2026 125 000 000 DKK 2,5810 % -215 30.12.2020 30.12.2025 300 000 000 DKK -0,1010 % 11 589 30.06.2022 30.06.2027 800 000 000 DKK 0,0460 % 67 934 03.07.2023 30.06.2026 300 000 000 DKK 0,0540 % 15 559 03.07.2023 28.03.2029 450 000 000 DKK 2,1590 % 9 147 03.07.2023 30.09.2030 100 000 000 DKK 2,8110 % -3 456 Total net excess value 159 962 31/12/2024 31/12/2023 SEK 2 725 374 2 700 365 DKK 4 606 011 4 583 592 Exchange rate on the balance sheet date 31/12/2024 31/12/2023 SEK 102,93 101,30 DKK 158,16 150,16 Non-Current and Current Interest bearing Financial Liabilities in foreign currency (in thousands of NOK)
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Counterparty risk Counterparty risk is limited by the fact that Steen & Strøm is structurally a borrower. The Group is therefore limited essentially to investments made by the Group and the Group's derivative transactions counterparties. The Group only conducts marketable securities and hedging instruments with leading Scandinavian financial institutions recognized as financially sound. Debt ratio The Group's objective is to secure continued operations by ensuring sustainable returns for shareholders and other stakeholder, and to maintain an optimal capital structure to reduce capital costs. To improve the capital structure, the group may adjust the level of dividends to shareholders repay capital to shareholders, issue new shares or sell assets in order to repay loans. Debt ratio as of 31 December 2024 and 2023 were as follows: Electricity hedging Steen & Strøm is purchasing «common» electricity on behalf of the center and thus our tenants, and for some centers in Sweden we also purchase electricity for our tenants’ «private consumption». To secure a stable and foreseeable budget, we are hedging the electricity price based on projected consumption for the portfolio, following a fixed, rolling strategy agreed with our provider. The defined strategy entails forward hedges corresponding to 80%, 60%, 40% and 20% of expected consumption for the subsequent 4 years. Forecasted consumption for all three countries is approx. 49.490 MWh/year. As energy prices have stabilized, the hedges do not constitute a significant, financial value at the current pricing level. The objective is however not financial gain, but stability and foreseeability.
9 ‐ LEASES The Group as lessee The Group has entered into several leases for vehicles, offices and properties/land. Several of these leases have an extension option. The agreements do not contain restrictions on the Company's dividends policy or financing opportunities. All lease agreements, where the Group is the lessee, have been reviewed in accordance with IFRS 16. Right-of-use assets and lease liabilities have been recognized in the statement of financial position measured at the present value of unavoidable lease payment. Further details about right-of-use assets and lease liabilities are provided in note 5.2 Furniture and equipment, 5.3a Investment properties and 5.10 Non- current and current financial liabilities. Comprehensive income statement impacts from applying IFRS 16 Leases: Future minimum lease payments related to non-cancellable leases fall due as follows (discounted values):
In thousands of NOK 31/12/2024 31/12/2023 Total financial liabilities (including bank facilities and excluding lease liabilities) 7 019 233 7 363 132 Cash and interest-bearing receivables 701 233 598 256 Net interest-bearing debt 6 318 000 6 764 876 Total non-current assets 29 644 346 28 959 995 Debt ratio 21,3% 23,4%
In thousands of NOK 2024 2023 Value change right-of-use assets related to investment properties -3 047 -2 968 Depreciation of right-of-use assets related to office and vehicle leases 8 310 4 448 Interest expense on lease labilities 8 818 8 629 Total (net expense) 20 175 16 045
44 * Leasing commitment related to 84-year lease of land in Denmark.
Consolidated statement of cash flows impacts from applying IFRS 16 Leases: Total cash payments made during 2024 and 2023 related to leases for vehicles, offices and properties/land accounted for in accordance with IFRS 16 Leases, where the Group is the lessee, amounted to NOK 19.95 million and NOK 19.90 million respectively. Group as lessor The Group's main activity is that of being a lessor of the Group's investment properties. Leases as described in the tables below are based on agreements as of 31 December 2024, and in nominal amounts. The Group's lease agreements are adjusted with changes in consumer price index on an annual basis. The carrying value of assets, leased under lease agreements where the Group is the lessor, is as follows: Future minimum lease payments related to non-cancellable leases fall due as follows: The Group's rental contracts can be divided into 1) Fixed rent, 2) Minimum rent + percentage of tenant’s turnover, and 3) Percentage of tenant’s turnover. Percentage of rental rates that are fixed are as follows: In thousands of NOK 31/12/2024 31/12/2023 Within 1 year 9 074 7 802 1 to 5 years 60 485 58 966 After 5 years* 381 972 365 019 Total 451 531 431 787 In thousands of NOK 2024 2023 Change in the fair value of investment properties -3 047 -2 968 Depreciation, amortization and provisions 8 310 4 448 Reclassification of financial interests and other items -8 818 -8 629 Repayment of loans, borrowings and hedging instruments -6 931 -6 716 In thousands of NOK 31/12/2024 31/12/2023 Investment properties 27 318 598 26 339 782 Total 27 318 598 26 339 782 In thousands of NOK 31/12/2024 31/12/2023 Within 1 year 633 355 1 002 933 1 to 5 years 925 031 1 273 228 After 5 years 369 310 175 087 Total 1 927 695 2 451 248 31/12/2024 31/12/2023 Norway 97,7 % 98,5 % Sweden 94,3 % 96,0 % Denmark 97,3 % 98,1 % Average 96,2 % 97,3 %
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10 ‐ PAYROLL EXPENSES Employees The average number of employees in the Group in 2024 and 2023 were 104 and 109, respectively. At 31 December 2024 (31 December 2023) the Group had 100 (111) employees. Pension cost All employees in the Group are on defined contribution plans. The contribution plans are in compliance with the legal requirements of each country. Bonus scheme Bonus is decided based on the Company's achieved results and an individual assessment of each employee. As of 31 December 2024 and 2023 NOK 9.9 million and NOK 14.8 million, respectively, have been accrued to cover the Group's bonus scheme. The bonus provision includes public and social taxes. No agreements have been entered with regards to severance payment or other post-employment benefits for the senior executives if the employment contracts are to be terminated. None of the Company's employees or members of the board have shares or stock options in the Company. In thousands of NOK 2024 2023 Wages, bonuses and indemnities 85 645 84 881 Social security tax 14 628 15 186 Pension costs 11 962 12 047 Other costs 9 331 9 230 Payroll expenses 121 565 121 345 2024 (in thousands of NOK) Salary Bonus Payment in kind Pension Total Group Management Christian Brewaeys - Chief Executive Officer 2 378 964 203 232 3 776 Bjørn Tjaum - Chief Investment Officer 2 294 781 364 257 3 696 Nils Eivind Risvand - Chief Legal Officer 1 820 815 306 218 3 159 Brian Jensen - Chief Financial Officer 2 404 624 198 235 3 461 Total compensation 8 896 3 183 1 071 943 14 092 2023 (in thousands of NOK) Salary Bonus Payment in kind Pension Total Group Management Christian Brewaeys - Chief Executive Officer (from 1 September 2023) 777 - 64 77 918 Marie Caniac - Chief Executive Officer (until 31 August 2023) 2 279 1 368 618 163 4 428 Bjørn Tjaum - Chief Investment Officer 2 233 882 369 280 3 764 Nils Eivind Risvand - Chief Legal Officer 1 786 822 352 235 3 196 Brian Jensen - Chief Financial Officer 2 678 843 133 227 3 881 Total compensation 9 753 3 915 1 537 982 16 187
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11.1 ‐ FAIR VALUE MEASUREMENTS This note provides information about how the Group determines the fair values of various assets and liabilities. Investment properties The Group has appointed Cushman & Wakefield as external appraiser for determining the fair value of the Group's investment properties. The fair value was determined based on the income approach. The model is based on the actual tenant situation, long-term predictions based on expected inflation and market developments. The shopping centers are appraised twice a year by the external appraiser. For further information see note 2.23 and note 5.3c. Hedging items Interest rate swaps are included in the balance sheet at fair value. The fair value of interest rate swaps is obtained from financial institutions. Other financial assets and liabilities Other financial assets consist of other non-current assets, trade accounts receivables and other receivables. Other financial liabilities consist of non-current and current financial liabilities, security deposits and guarantees, bank facilities, trade payables, other liabilities and social and tax liabilities. All accounting items measured at fair value have been categorized to assess valuation uncertainty. · Level 1 includes investments where fair value has been determined based on quoted prices in active markets. · Level 2 includes investments where fair value has been determined based on valuation modelling and market information. These investments are more uncertain than Level 1. · Level 3 includes investments where fair value has not been determined based on observable market data (i.e. unobservable inputs). Investments in Level 3 is determined using valuation models that, in material aspect, uses input that is non observable market data which implies that there exists a considerable uncertainty in determining fair value. Description of adapted methods for determining fair value on liabilities and assets measured at other than fair value in the balance sheet The carrying value of cash, cash equivalents and bank overdrafts approximates their fair value as these instruments have short maturities. Similarly, the book value of accounts receivable and accounts payable approximates to fair value. For other financial assets and liabilities, except the accounting items described above, fair value is calculated as the present value of estimated cash flows discounted at the rate applicable to similar liabilities and assets on the balance sheet date. This value is approximately equal to fair value. in thousands of NOK Level 1 Level 2 Level 3 Total Total investment properties (including assets held for sale) 27 737 713 27 737 713 Total financial derivatives 159 965 159 965 Other financial assets 558 487 6 254 564 740 Other financial liabilities -8 602 456 - -8 602 456 Total other financial assets and liabilities - -8 043 969 6 254 -8 037 716 Total - -7 884 005 27 743 966 19 859 962 in thousands of NOK Level 1 Level 2 Level 3 Total Total investment properties (including assets held for sale) - - 26 815 601 26 815 601 Total financial derivatives - 262 569 - 262 569 Other financial assets - 401 076 6 471 407 547 Other financial liabilities - -9 291 611 - -9 291 611 Total other financial assets and liabilities - -8 890 536 6 471 -8 884 065 Total - -8 627 967 26 822 072 18 194 105 31/12/2024 31/12/2023
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11.2 - LITIGATIONS AND CLAIMS Steen & Strøm is a Scandinavian company that, through its ongoing business operations, will be exposed to litigations and claims from public authorities and contracting parties. Changes in individual countries’ tax laws, could increase the Group’s tax exposure. The Group’s assessment is that best estimate provisions have been made for the aforementioned conditions. Field´s – “Naturklagenævnet” In the High Court of Eastern Denmark validated a decision from the Nature Protection Board of Appeal, which stated that the building permit for a part of the shopping centre “Field´s” did not comply with the local development plan. The decision was upheld in 2014 after a complaint. The party to this decision was the Municipality of Copenhagen, however Steen & Strøm had the right to appeal. Steen & Strøm issued a lawsuit in 2014, claiming that the decision of the Nature Protection Board of Appeal is void, on several grounds. The court process has taken several years. In 2016, a specific issue was separated from the case and heard for Copenhagen City Court. Steen & Strøm stated that the case should be dismissed, as the organization making the initial protest, did not have sufficient legal interest. However, Steen & Strøm was not successful with this argument. The main hearing was held in 2024. Steen & Strøm lost the case in full but has appealed to the High Court (“Landsret”). An appeal hearing is expected in 2027. The appeal court will hear the case in full, including the “legal interest” argument. Steen & Strøm will also claim that the case should be referred to the ECJ (European Courts of Justice) for a preliminary ruling on the EU law matters in the case. Tax case – Lillestrøm Torv The Norwegian tax authorities have decided that taxable income in Lillestrøm Torv AS, a former subsidiary of Steen & Strøm AS shall be increased by NOK 85.3 million for the income year 2015. The amount entails a tax of NOK 23 million. The reason for the decision is that a property transferred to another group company in 1997, by mistake, remained in the transferring company's books. This was corrected when it was discovered in 2015, but the tax authorities' opinion was that the realization first took place in 2015. Steen & Strøm, on behalf of Lillestrøm Torv AS, filed a complaint to the Norwegian Tax Administration (“Skatteklagenemnda”), however after several years handling time, the Administration ruled in favour of the tax office. Steen 6 Strøm took the case to court in 2024, and the main hearing is scheduled for March 2025.
11.3 ‐ RELATED PARTIES The parent company of the Steen & Strøm Group, Steen & Strøm AS is a 100% owned subsidiary of Storm Holding Norway AS. Storm Holding Norway AS is fully owned by Nordica HoldCo AB, which in turn is owned by subsidiaries of Klépierre SA and Stichting Pensionenfonds ABP. Transactions between related parties are mainly related to provision of group shared services, and financing. All transactions with related parties are carried out at arm's length principle.
11.4 ‐ POST‐BALANCE SHEET DATE EVENTS There were no significant events after the balance sheet date which can impact the evaluation of the consolidated financial statements for 2024.
11.5 ‐ AUDIT FEES
In thousands of NOK 2024 2023 Standard IT fee -11 367 -14 612 Total -11 367 -14 612
In thousands of NOK 2024 2023 Statutory audit 4 755 5 083 Other services 294 298 Total 5 049 5 381
48 CONTENTS – FINANCIAL STATEMENT STEEN & STRØM AS STATEMENT OF COMPREHENSIVE INCOME ................................................................................................................................. 49 STATEMENT OF FINANCIAL POSITION .......................................................................................................................................... 50 STATEMENT OF CASH FLOWS ....................................................................................................................................................... 52 STATEMENT OF CHANGES IN EQUITY ........................................................................................................................................... 53 NOTES TO THE FINANCIAL STATEMENTS ...................................................................................................................................... 54 ACCOUNTING PRINCIPLES .................................................................................................................................................... 54 1 ‐ SOFTWARE, PROPERTY, PLANT & EQUIPMENT .............................................................................................................. 54 2 - PAYROLL EXPENSES ......................................................................................................................................................... 55 3 - BREAKDOWN OF OTHER OPERATING EXPENSES ............................................................................................................ 55 4 ‐ INVESTMENTS IN SUBSIDIARIES AND OTHER COMPANIES ............................................................................................. 56 5 - INTERCOMPANY RECEIVABLES AND PAYABLES .............................................................................................................. 56 6 ‐ FINANCIAL INTRUMENTS ‐ EXPOSURE TO RISK............................................................................................................... 57 7 - LIABILITIES ....................................................................................................................................................................... 57 8 - TAX .................................................................................................................................................................................. 58 9 ‐ INVESTMENTS IN ASSOCIATED COMPANIES AND JOINT VENTURES .............................................................................. 59 10 ‐ LITIGATIONS AND CLAIMS ............................................................................................................................................ 59 11 ‐ SHAREHOLDER'S EQUITY AND TREASURY SHARES ....................................................................................................... 59 12 ‐ SHARES OWNED BY THE CEO OR MEMBERS OF THE BOARD ....................................................................................... 59 13 ‐ GUARANTEES, BAIL DECLARATIONS AND PLEDGES ...................................................................................................... 59 14 ‐ RELATED PARTIES .......................................................................................................................................................... 59 15 ‐ POST BALANCE SHEET DATE EVENTS ............................................................................................................................ 59
49 STATEMENT OF COMPREHENSIVE INCOME In thousands of NOK Note 2024 2023 Other operating income 131 049 107 115 Gain from sales of assets 1 0 95 Total operating income 131 049 107 210 Payroll expenses 2 44 069 48 803 Depreciation 1 10 473 10 160 Other operating expenses 1, 2, 3 91 510 72 369 Total operating expenses 146 052 131 332 Operating income - 15 003 - 24 122 Financial income and expenses Income from investments in subsidiaries and joint ventures 4 161 832 789 088 Gain from sale of investments in subsidiaries and joint ventures 4 127 3 822 Interest received from group companies 5 2 813 56 555 Net interest on cash and cash equivalents 28 814 22 966 Other financial income 6 48 850 60 695 Write-down/reversal of write-down on shares 4 166 871 - 88 515 Interest paid to group companies 5 - 105 105 - 19 563 Interest on borrowings 1, 7 - 17 646 - 32 447 Other financial expenses 6 - 70 901 - 48 359 Net financial income and expenses 215 654 744 242 Profit before tax 200 651 720 120 Corporate income tax 8 235 17 647 Corporate income tax 235 17 647 Net income 200 887 737 767 Other comprehensive income items recognized directly as equity Items that may be reclassified subsequently to profit or loss Effective portion of profits and losses on cash-flow hedging instruments (IFRS 9) 0 - 69 730 Tax on cash-flow hedging instruments 0 15 341 Total comprehensive income 6, 8 200 887 683 378
50 STATEMENT OF FINANCIAL POSITION In thousands of NOK Note 31/12/2024 31/12/2023 Intangible assets Deferred tax assets 8 62 345 61 445 Software 1 23 369 20 773 Total intangible assets 85 714 82 218 Property, plant & equipment Company cabin 1 1 413 1 681 Cars, machinery and equipment 1 1 748 1 442 Right-of-use assets 1 8 082 11 926 Total property, plant & equipment 11 242 15 049 Financial assets Investment in subsidiaries 4 9 400 216 7 816 345 Loans to subsidiaries 5, 6 75 225 1 492 000 Investments in joint ventures 9 1 021 532 1 021 500 Investments in shares 4 230 230 Other non-current receivables 6 0 15 919 Total financial assets 10 497 203 10 345 993 NON-CURRENT ASSETS 10 594 159 10 443 260 Receivables Trade receivables 3 425 4 084 Current receivables from group companies 5 3 751 329 3 740 432 Other current receivables 6, 10 22 467 25 937 Total current receivables 3 777 220 3 770 453 Cash and cash equivalents Cash and cash equivalents 2 626 206 495 103 CURRENT ASSETS 4 403 427 4 265 556 TOTAL ASSETS 14 997 585 14 708 815
51 STATEMENT OF FINANCIAL POSITION In thousands of NOK Note 31/12/2024 31/12/2023 Contributed equity: Share capital 73 259 73 259 Share premium 4 028 584 4 028 584 Total contributed equity 11 4 101 843 4 101 843 Retained earnings: Other equity 4 660 383 4 459 496 Total earned equity 4 660 383 4 459 496 SHAREHOLDERS' EQUITY 8 762 226 8 561 339 Bonds 6, 7 100 000 100 000 Liabilities to group companies 5 0 539 749 Other non-current liabilities 1 4 554 8 182 NON-CURRENT LIABILITIES 104 554 647 931 Trade payables 1 103 79 Social and tax liabilities 4 210 5 101 Tax payable 8 665 - Current liabilities to group companies 5 6 094 618 5 058 923 Certificates, bonds and other current debt 7 1 915 404 167 Other current liabilities 1, 10 28 295 31 275 CURRENT LIABILITIES 6 130 805 5 499 545 TOTAL LIABILITIES 6 235 359 6 147 476 TOTAL SHAREHOLDERS’ EQUITY AND LIABILITIES 14 997 585 14 708 815
52 STATEMENT OF CASH FLOWS In thousands of NOK Note 2024 2023 Net income 200 887 737 767 Corporate income tax 8 -235 -17 647 Paid tax for the period - - Gain/Loss on sale of non-current assets - 14 905 Income from investments in subsidiaries and joint ventures 4 -161 832 -789 088 Gain/Loss on sale of shares 4 -127 -3 822 Gain/Loss on sale of derivatives 6 7 093 -42 858 Depreciation on fixed assets 1 10 473 10 160 Write-down/reversal of write-down on financial assets 4 -166 871 88 515 Changes in trade receivables 660 10 245 Changes in trade payable 1 024 79 Changes in social and tax liabilities -891 242 Changes in other current assets & other current liabilities 5 490 56 961 Net cash flow from operating activities -104 331 65 458 Payments on acquisitions of non-current assets 9 -1 417 032 -15 000 Proceeds from sale of non-current assets 4, 6 127 188 917 Payments on acquisitions of other assets 1 -9 064 -6 247 Proceeds from loans to subsidiaries 1 416 775 26 762 Proceeds from dividends 161 832 789 088 Net cash flow from investing activities 152 638 983 521 Proceeds from borrowings 6, 7 1 035 695 - Payments on borrowings 7 -952 898 -693 080 Proceeds from sale of derivatives 6 - 75 181 Payments of dividends - - Net cash flow from financing activities 82 796 -617 899 NET CHANGES IN CASH 131 103 431 080 Cash at the start of the period 495 103 64 023 Net changes in cash 131 103 431 080 Cash at the end of the period 626 206 495 103
53 STATEMENT OF CHANGES IN EQUITY 31/12/2023 In thousands of NOK Share capital Additional paid-in capital Other equity Total equity Opening statement 73 259 4 028 584 3 871 973 7 973 817 Group contribution - 95 855 - 95 855 Net income for the period 737 767 737 767 Income from cash-flow hedging - 54 389 - 54 389 Closing statement 73 259 4 028 584 4 459 494 8 561 339 31/12/2024 In thousands of NOK Share capital Additional paid-in capital Other equity Total equity Opening statement 73 259 4 028 584 4 459 494 8 561 339 Group contribution 0 0 Net income for the period 200 887 200 887 Income from cash-flow hedging 0 0 Closing statement 73 259 4 028 584 4 660 381 8 762 226
54 NOTES TO THE FINANCIAL STATEMENTS All amounts in thousands of NOK, unless otherwise specified. ACCOUNTING PRINCIPLES The accounts have been prepared in accordance with simplified application of international accounting standards according to §3‐9 of the Norwegian Accounting Act. See also note 2 in the group's consolidated financial statements. The explanation of the accounting policies also applies to the parent company, and the notes to the consolidated financial statements will in some cases cover the parent company. Simplified Application As from 2022 the Company has applied the following simplification to the recognition and valuation rules of IFRS: ‐ IAS 10, paragraph 12 and 13 are omitted so that dividends and group contribution accounted for in accordance with Norwegian Accounting Act. The tax is recognized in accordance with IAS 12.57A as under full IFRS, where the tax effects of the distribution are presented as a tax expense in the statement of comprehensive income in the same period as the distribution is accrued as a liability. Shares in subsidiaries and joint ventures Shares in subsidiaries and joint ventures are stated using the cost method. 1 ‐ SOFTWARE, PROPERTY, PLANT & EQUIPMENT Intangible assets - software 31/12/2024 31/12/2023 Acquisition cost as of 01/01 211 942 205 750 Acquisition 8 080 6 192 Acquisition cost as of 31/12 220 022 211 942 Acc. depreciation as of 31/12 196 653 191 168 Net book value as of 31/12 23 369 20 773 Depreciation for the year 5 485 5 657 Cars, machinery and equipment 31/12/2024 31/12/2023 Acquisition cost as of 01/01 16 913 17 357 Acquisition 984 55 Disposal 0 - 500 Acquisition cost as of 31/12 17 897 16 913 Acc. depreciation as of 31/12 16 149 15 470 Net book value as of 31/12 1 748 1 442 Depreciation for the year 678 348 Company cabin 31/12/2024 31/12/2023 Acquisition cost as of 01/01 6 698 6 698 Acquisition cost as of 31/12 6 698 6 698 Acc. depreciation as of 31/12 5 286 5 018 Net book value as of 31/12 1 413 1 681 Depreciation for the year 268 268
55 2 - PAYROLL EXPENSES Employees The average number of employees in Steen & Strøm AS in 2024 and 2023 were 33,67 and 35, respectively. Remuneration of senior executives See note 10 of the consolidated financial statements. Audit fees The audit fee for Steen & Strøm AS in 2024 was NOK 2 176 thousand (NOK 1 516 thousand in 2023). Other certification service for Steen & Strøm AS in 2024 was NOK 0. Restricted funds As of 31 December 2024, and 2023, restricted funds amounted to NOK 2 958 thousand and NOK 2 092 thousand. 3 - BREAKDOWN OF OTHER OPERATING EXPENSES Right-of-use assets 31/12/2024 31/12/2023 Net book value as of 01.01 11 926 14 736 Acquisition 198 1 078 Disposal - 0 - 4 042 - 3 888 Net book value as of 31/12 8 082 11 926 Rent period as of 31/12/2023 is 4 years and 3 months. Liabilities right-of-use assets 31/12/2024 31/12/2023 Other Non-Current liabilities 4 554 8 182 Current liabilities (1. year payment) 3 592 3 797 Total liabilities right-of-use assets as of 31/12 8 147 11 980 Interest expenses right-of-use liabilities of NOK 107 thousand. Depreciation and impairment allowances 2024 2023 Wages, bonuses and indemnities 31 459 35 316 Social security tax 5 751 6 328 Pension costs 2 744 3 088 Other costs 4 115 4 071 Total payroll expenses 44 069 48 803 2024 2023 Rental space 1 426 1 262 Management and other fees 7 053 3 937 Other operating expenses 3 638 3 601 Other administrative costs 79 393 63 569 Total other operating expenses 91 510 72 369
56 4 ‐ INVESTMENTS IN SUBSIDIARIES AND OTHER COMPANIES All subsidiaries are valued at cost. Final pro & contra from sales of fully owned subsidiaries conducted in 2021 and 2022 is in 2023 NOK 3 822 thousand. Book value includes accumulated write down of investments in subsidiaries of NOK 77 924 thousand. 5 - INTERCOMPANY RECEIVABLES AND PAYABLES *) Non-current receivables/liabilities to group companies have a maturity of 1,5 years. Of this amount, NOK 1 417 thousand has been converted to shares in 2024. The Steen & Strøm group maintain a group account scheme for bank accounts in Norway, Sweden and Denmark which are linked to the groups overdraft accounts. The subsidiaries' bank accounts included in this scheme is formally receivables or liabilities against the parent company and are classified in Steen & Strøm's balance sheet accordingly. Company Ownership 31/12 Value at 31/12 AS Kristiania Byggeselskap for smaaleiligheter, Oslo, Norway 0,5 % 230 Book value of Investments in other shares 230 Company Ownership 31/12 31/12/2024 31/12/2023 Steen & Strøm Danmark A/S, Copenhagen, Denmark 100 % 1 032 070 1 032 070 Oslo City Kjøpesenter AS, Oslo, Norway 100 % 4 399 421 2 817 881 Olso City Parkering AS, Oslo, Norway 100 % 131 925 129 595 Steen & Strøm Mediapartner Norge AS, Oslo, Norway 100 % 107 107 Steen & Strøm Senterservice AS, Oslo, Norway 100 % 20 367 20 367 Steen & Strøm Holding AB, Stockholm, Sweden 100 % 3 816 324 3 816 324 Book value of investments in subsidiaries 9 400 216 7 816 345 Income from investments in subsidiaries and joint ventures 2024 2023 Dividends from subsidiaries - 277 754 088 Distributions from joint ventures 35 000 35 000 Received group contribution 127 109 0 Total 161 832 789 089 Current assets and current liabilities 31/12/2024 31/12/2023 Current receivables from group companies 3 751 329 3 740 432 Non-current receivables from group companies *) 75 225 1 492 000 Total receivables 3 826 554 5 232 431 Current liabilities to group companies 6 094 618 5 058 923 Non-current liabilities to group companies 0 539 749 Total liabilities 6 094 618 5 598 672 Interest received from group companies 2 813 56 555 Interest paid to group companies - 105 105 - 19 563 Net interest - 102 292 36 991
57 6 ‐ FINANCIAL INTRUMENTS ‐ EXPOSURE TO RISK For a comprehensive description of the Group's strategy, see note 8 of the consolidated financial statements. The company has as of 31/12/2024 recorded a net receivable of NOK 0 related to financial instruments. The corresponding amount for 31/12/2023 was a net receivable of NOK 15 918 thousand. In 2024 the company has sold financial instruments with a net gain of NOK 8 826 thousand. Assets and liabilities are recorded at exchange rates per 31/12/2024. Changes in exchange rates compared with last year's exchange rates at 31/12/2023 is posted in the accounts as a loss / gain. Steen & Strøm AS has in 2024 had a net loss on foreign currency of NOK 17 210 thousand. Of this amount a loss of NOK 48 651 thousand is realized. The corresponding amounts in 2023 was a net gain of NOK 9 722 thousand of which NOK 150 497 thousand in realized gain. In connection to the divestment of three fully owned subsidiaries in 2022, Steen & Strøm AS has granted a seller's credit to the buyer of the companies of NOK 200 000 thousand. The loan was repaid in full in 2023. See note 5.5 of the consolidated financial statements for more information. Remaining lines of credit are NOK 1 970 000 thousand. 7 - LIABILITIES The table excludes intercompany loans. Secured debt includes also collateral of other Group companies' assets. Summary of non-current receivables and debts in foreign currency 2024 2023 Non-current debt In SEK - 299 749 In DKK - 156 540 Exchange rate on the balance sheet date SEK - 1,01 DKK - 1,51 Non-current receivables - - Non-current debt - 539 749 Non-current interest bearing borrowings 31/12/2024 31/12/2023 Bonds 100 000 100 000 Total non-current interest bearing borrowings 100 000 100 000 Current borrowings Bonds 1 915 404 167 Total current borrowings 1 915 404 167 Repayment plans and renegotiation of non-current debt: Between 1 and 5 years - - More than 5 years 100 000 100 000 Total 100 000 100 000
58 8 - TAX Temporary differences 31/12/2024 31/12/2023 Fixed assets - 2 622 - 1 630 Long-term liabilities - - 38 421 Non-current receivables - - Shares in partnerships - 283 933 - 257 310 Taxable profit and loss account 3 235 4 044 Accrual of interest rate swap 280 Other differences - 65 13 744 Net temporary differences - 283 385 - 279 294 Basis for deferred tax / tax assets - 283 385 - 279 294 22 % deferred tax / deferred tax assets - 62 345 - 61 445 Total deferred tax assets (-) / liabilities (+) - 62 345 - 61 445 Explanation of the tax expense 2024 2023 22 % tax on profit before tax 44 143 158 426 Change of shares in partnerships from previous years - 5 857 - 7 506 Tax on given/received group contribution adopted this year 27 964 - 21 088 Permanent differences - 38 522 - 147 479 Corporate income tax expense 27 729 - 17 647 Analysis of tax expense 2024 2023 Change in deferred tax - 900 - 32 987 Correction of tax expence from previous year - 0 The tax effects recognized in equity 0 15 341 Corporate income tax expense - 235 - 17 647 Basis for tax payable 2024 2023 Profit before tax 200 651 720 120 Write-downs on shares - 166 871 88 515 Income from partnerships 26 623 34 118 Profit (-) /loss (+) from sale of shares - 127 - 3 822 Dividends from subsidiaries and other ownerships - 34 723 - 789 136 Unrealized foregin exchange gains - - Other permanent differences 0 - 34 Basis for this year's tax 25 553 49 760 Change in temporary differences - 22 532 46 095 Given/Received group contribution adopted this year - 95 855 Taxable income 3 021 - Use of tax losses carried forward - - Basis for tax payable 3 021 - Tax payable (22%) 665 -
59 9 ‐ INVESTMENTS IN ASSOCIATED COMPANIES AND JOINT VENTURES Associated companies and joint ventures in the statutory accounts are recorded at cost method. 10 ‐ LITIGATIONS AND CLAIMS See note 11.2 of the consolidated financial statements. 11 ‐ SHAREHOLDER'S EQUITY AND TREASURY SHARES See note 5.9 of the consolidated financial statements. 12 ‐ SHARES OWNED BY THE CEO OR MEMBERS OF THE BOARD None of the Company's employees or Members of the Board have shares or stock options in the Company See note 10 of the consolidated financial statements. 13 ‐ GUARANTEES, BAIL DECLARATIONS AND PLEDGES Steen & Strøm AS is by ownership solely responsible for the debts of the following companies: Steen & Strøm AS has given the following guarantees, bail declarations and pledges: 14 ‐ RELATED PARTIES See note 11.3 of the consolidated financial statements. 15 ‐ POST BALANCE SHEET DATE EVENTS See note 11.4 of the consolidated financial statements. Company Ownership 31/12 Value at 01/01 Capital increase / Sale Value at 31/12 Metro Senter ANS 50,0 % 490 750 - 490 750 Økern Sentrum ANS 50,0 % 530 750 32 530 782 Total 1 021 500 32 1 021 532 Total debt SST Share Ownership Økern Sentrum ANS 4 213 2 107 50,0 % Metro Senter ANS 18 127 9 063 50,0 % Total 22 340 Type Banking partner 31/12/2024 Bail declatration - surety for indemnity declaration previous tenants Nordea Bank AB, Norwegian branch 2 147 Pledges sercured in investment property of subsidiaries Different partners 9 597 100 Total off balance sheet commitments of garantees, bail declarations and pledges 9 599 247
Deloitte AS Dronning Eufemias gate 14 Postboks 221 NO-0103 Oslo Norway +47 23 27 90 00 www.deloitte.no Deloitte AS and Deloitte Advokatfirma AS are the Norwegian affiliates of Deloitte NSE LLP, a member firm of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee (“DTTL”). DTTL and each of its member firms are legally separate and independent entities. DTTL and Deloitte NSE LLP do not provide services to clients. Please see www.deloitte.com/about to learn more about our global network of member firms. Deloitte Norway conducts business through two legally separate and independent limited liability companies; Deloitte AS, providing audit, consulting, financial advisory and risk management services, and Deloitte Advokatfirma AS, providing tax and legal services. Registrert i Foretaksregisteret Medlemmer av Den norske Revisorforening Organisasjonsnummer: 980 211 282 To the General Meeting of Steen & Strøm AS INDEPENDENT AUDITOR’S REPORT Report on the Audit of the Financial Statements Opinion We have audited the financial statements of Steen & Strøm AS, which comprise: • The financial statements of the parent company Steen & Strøm AS (the Company), which comprise statement of financial position as at 31 December 2024, statement of comprehensive income, statement of changes in equity and statement of cash flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies. • The consolidated financial statements of Steen & Strøm AS and its subsidiaries (the Group), which comprise consolidated statement of financial position as at 31 December 2024, consolidated statement of comprehensive income, consolidated statement of changes in equity and consolidated statement of cash flows for the year then ended, and notes to the financial statements, including material accounting policy information. In our opinion • the financial statements comply with applicable statutory requirements, • the financial statements give a true and fair view of the financial position of the Company as at 31 December 2024, and its financial performance and its cash flows for the year then ended in accordance with simplified application of International Accounting Standards according to the Norwegian Accounting Act section 3-9, and • the consolidated financial statements give a true and fair view of the financial position of the Group as at 31 December 2024, and its financial performance and its cash flows for the year then ended in accordance with IFRS Accounting Standards as adopted by the EU. Our opinion is consistent with our additional report to the Audit Committee. Basis for Opinion We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Company and the Group as required by relevant laws and regulations in Norway and the International Ethics Standards Board for Accountants’ International Code of Ethics for Professional Accountants (including International Independence Standards) (IESBA Code), and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. To the best of our knowledge and belief, no prohibited non-audit services referred to in the Audit Regulation (537/2014) Article 5.1 have been provided. We have been the auditor of Steen & Strøm AS for 16 years from the election by the general meeting of the shareholders on 8 November 2009 for the accounting year 2009. 60
Independent auditor’s report Steen & Strøm AS 61 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 2024. 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. Valuation of investment property Description of the Key Audit Matter How the matter was addressed in the audit The majority of the group's assets consist of investment properties. The carrying amount of investment properties as at 31 December 2024 is NOK 27 738 million. In addition, the group has interest in investment properties through jointly controlled companies, accounted for using the equity method. The carrying value of the jointly controlled companies is NOK 1 744 million as at 31 December 2024. Investment properties are measured at fair value. Fair value adjustments of investment properties may have a significant effect on the group’s operating income and consequently the equity. The fair value is based on estimates as well as property specific information. The basis for management’s estimates is valuations performed by external, independent appraisers. These estimates require significant judgement and therefore valuation of investment property is a key audit matter. Refer to note 2.23 "Critical accounting judgements and key sources of estimation uncertainty” in addition to note 5.3 and 5.4 in the financial statements of the group for details of investment properties and valuation methodology. We evaluated the design and implementation of the control activities that management has established to ensure that relevant property information is included in the external valuations. For a sample of investment properties, we reconciled the information regarding annual rent in the external valuers' reports to the group’s own records. We assessed the external valuers' competence and qualifications and that the valuation methods used were in accordance with generally accepted valuation standards and were appropriate to determine fair value of the group’s investment properties. We met with the external appraisers, and discussed and challenged assumptions used and reason behind significant movements in valuations from previous periods. Were relevant, we compared the assumptions used with observable market data and our knowledge about the market. We reconciled the values used in the financial statements to the valuation reports. We used Deloitte valuation specialists in our audit of the valuation of investment property. We also assessed the adequacy of the related disclosures in the financial statements. Other Information The Board of Directors and the Managing Director (management) are responsible for the information in the Board of Directors’ report and the other information accompanying the financial statements. The other information comprises information in the annual report, but does not include the financial statements and our auditor’s report thereon. Our opinion on the financial statements does not cover the information in the Board of Directors’ report nor the other information accompanying the financial statements. In connection with our audit of the financial statements, our responsibility is to read the Board of Directors’ report and the other information accompanying the financial statements. The purpose is to consider if there is material inconsistency between the Board of Directors’ report and the other information accompanying the financial statements and the financial statements or our knowledge obtained in the audit, or whether the Board of Directors’ report and the other information accompanying the financial statements otherwise appear to be materially misstated. We are required to report if there is a material misstatement in the Board of Directors’ report or the other information accompanying the financial statements. We have nothing to report in this regard.
Independent auditor’s report Steen & Strøm AS 62 Based on our knowledge obtained in the audit, it is our opinion that the Board of Directors’ report • is consistent with the financial statements and • contains the information required by applicable statutory requirements. Our statement on the Board of Directors’ report applies correspondingly to the statement on Corporate Governance. Responsibilities of Management for the Financial Statements Management is responsible for the preparation of financial statements of the Company that give a true and fair view in accordance with simplified application of International Accounting Standards according to the Norwegian Accounting Act section 3-9, and for the preparation of the consolidated financial statements of the Group that give a true and fair view in accordance with IFRS Accounting Standards as adopted by the EU. Management is responsible for such internal control as management determines 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, management is responsible for assessing the Company’s and the Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or the Group or to cease operations, or has no realistic alternative but to do so. Auditor’s Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about 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 ISAs 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 these financial statements. As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional scepticism throughout the audit. We also: • identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error. We 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 Company’s and 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 management’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 Company’s and 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 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 Company and 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 in a manner that achieves a true and fair view.
Independent auditor’s report Steen & Strøm AS 63 • 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 the Board of Directors 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 the Audit Committee with a statement that we have complied with relevant ethical requirements regarding independence, and to 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 the Board of Directors, 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. Report on Other Legal and Regulatory Requirements Report on Compliance with Requirement on European Single Electronic Format (ESEF) Opinion As part of the audit of the financial statements of Steen & Strøm AS, we have performed an assurance engagement to obtain reasonable assurance about whether the financial statements included in the annual report, with the file name 5967007LIEEXZXJNDK21-2024-12-31-0-en.zip, have been prepared, in all material respects, in compliance with the requirements of the Commission Delegated Regulation (EU) 2019/815 on the European Single Electronic Format (ESEF Regulation) and regulation pursuant to Section 5-5 of the Norwegian Securities Trading Act, which includes requirements related to the preparation of the annual report in XHTML format and iXBRL tagging of the consolidated financial statements. In our opinion, the financial statements, included in the annual report, have been prepared, in all material respects, in compliance with the ESEF regulation. Management’s Responsibilities Management is responsible for the preparation of the annual report in compliance with the ESEF regulation. This responsibility comprises an adequate process and such internal control as management determines is necessary. Auditor’s Responsibilities Our responsibility, based on audit evidence obtained, is to express an opinion on whether, in all material respects, the financial statements included in the annual report have been prepared in compliance with ESEF. We conduct our work in compliance with the International Standard for Assurance Engagements (ISAE) 3000 – “Assurance engagements other than audits or reviews of historical financial information”. The standard requires us to plan and perform procedures to obtain reasonable assurance about whether the financial statements included in the annual report have been prepared in compliance with the ESEF Regulation. As part of our work, we have performed procedures to obtain an understanding of the Company’s processes for preparing the financial statements in compliance with the ESEF Regulation. We examine whether the financial statements are presented in XHTML-format. We evaluate the completeness and accuracy of the iXBRL tagging of the consolidated financial statements and assess management’s use of judgement. Our procedures include reconciliation of the iXBRL tagged data with the audited financial statements in human-
Independent auditor’s report Steen & Strøm AS 64 readable format. We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Oslo, 3 April 2025 Deloitte AS Gry Kjersti Berget State Authorised Public Accountant
65 ALTERNATIVE PERFORMANCE MEASURES (APM) Net rental income on like‐for‐like basis includes only comparable data (i.e. the portion of the portfolio that has remained the same year over year). The computation does not include equity investments (the one partly owned shopping center in Norway). The Scandinavian holding fee has been neutralized. Direct operating expenses occur at the shopping centers and are equal to gross rental income minus net rental income. Other operating expenses occur in the management companies and relate to commercial management and development of the portfolio. Net rental income including equity investments In thousands of NOK 2024 2023 Net rental income of Consolidated Statement of Comprehensive Income 1 395 586 1 347 247 Group share of Net rental income from Equity investments according to note 5.4B 45 885 52 516 Net rental income including equity investments 1 441 471 1 399 763 Net rental income on like-for-like 2024 Denmark Norway Sweden Total Net rental income of current operations (see note 3.1) 593 997 221 502 580 087 1 395 586 Net rental income of constant operations 599 609 222 776 573 703 1 396 088 Variable -5 612 -1 274 6 384 -502 2023 Net rental income of current operations (see note 3.1) 581 287 216 821 549 146 1 347 253 Net rental income of constant operations 579 394 216 877 556 887 1 353 158 Variable 1 893 -56 -7 741 -5 905 Net rental income increase on like-for-like basis 3,5 % 2,7 % 3,0 % 3,2 % Direct operating expenses In thousands of NOK 2024 2023 Non recoverable rental expenses 143 075 158 885 Building expenses (owner) 33 484 13 150 Direct operating expenses 176 559 172 035 Other operating expenses In thousands of NOK 2024 2023 Payroll expenses 121 565 121 345 Other general expenses 65 616 91 015 Depreciation and impairment allowance on investment properties 288 270 Depreciation and impairment on intangible assets and furniture and equipment 15 002 11 022 Other operating expenses 202 472 223 652
66 Net interest‐bearing debt is defined as interest‐bearing debt, excluding lease liabilities, deducted cash on account. Reversion rate expresses the average increase of yearly Minimum Guaranteed Rent (MGR) for re‐let and renewed contracts signed during the year. Net interest bearing debt In thousands of NOK 2024 2023 Non-current financial liabilities (excluding lease liabilities according to IFRS 16) 6 816 748 6 208 150 Current financial liabilities (excluding lease liabilities according to IFRS 16) 202 485 1 154 982 Bank facilities 0 -0 Cash and cash equivalents -701 233 -598 256 Net interest bearing debt 6 318 000 6 764 876 Loan to Value In thousands of NOK 2024 2023 Investment properties and properties under construction (excluding right-of-use assets according to IFRS 16) 27 302 332 26 398 095 Equity method securities 1 744 134 1 790 398 Value of portfolio 29 046 466 28 188 493 In thousands of NOK 2024 2023 Net interest bearing debt 6 318 000 6 764 876 Value of portfolio 29 046 466 28 188 493 Loan to Value 21,8 % 24,0 % Book equity ratio In thousands of NOK 2024 2023 Shareholders’ Equity 18 651 839 17 342 219 Total Assets 31 323 180 30 435 145 Book equity ratio 59,5 % 57,0 % Reversion rate In thousands of NOK Denmark Norway Sweden Total Previous MGR 60 208 124 871 97 322 282 401 New yearly MGR 55 548 123 183 100 686 279 417 Reversion rate -7,7 % -1,4 % 3,5 % -1,1 %
WELCOME TO A UNIQUE SHOPPING EXPERIENCE! www.steenstrom.com Supporting the most attractive brands with the best assets in prime locations, strengthening our societal and environmental responsibility and sharing the beneﬁts with our customers, innovating together to give a new dimension to retail… Welcome to Steen & Strøm! STEEN & STRØM AS Dronning Eufemias gate 8 0191 Oslo, Norway +47 23 21 35 00 ﬁrmapost@steenstrom.com STEEN & STRØM DANMARK A/S Arne Jacobsens Allé 20, 3. 2300 København S, Denmark +45 70 10 55 05 post@steenstrom.com STEEN & STRÖM SVERIGE AB Box 16335 103 26 Stockholm, Sweden +46 8 508 99 900 info.sverige@steenstrom.com