Globe Trade Centre S.A. (GTC) has posted its Q2 2008 results.GTC posted a net profit of EUR 42.8m in Q2 2008 (+23% QoQ). Operating revenues grew 46% YoY to EUR 19.1m.The company maintains high liquidity with EUR 292m in cash. The first projects in Russia and Ukraine have been acquired

Revenues from operations increased 46% YoY to EUR 19.1m resulting mainly from lease commencement in newly completed buildings, as well as the increase of rental income in existing shopping centres and office buildings.

Net profit was EUR 42.8m vs EUR 34.8m in Q1 2008 (23% increase QoQ).

A year ago, Q2 2007 net profit was EUR 77.9m – a difference YoY attributed to completion of a large shopping centre, Avenue Mall in Zagreb, in that quarter.

In Q2 2008, profit from revaluation of the Zephirus office building (9,200 sqm NRA) in Warsaw and Galleria Buzău (13,300 sqm GLA) in Romania was EUR 20.9m (before tax). The independent international appraisers based their valuations on 6.2% and 7.5% exit yields respectively.

An additional EUR 6.8m in income resulted from reversal of market value impairment of land in the Osiedle Konstancja development in Warsaw.

An effective strategy of hedging interest rate and currency risk for GTC’s financial liabilities resulted in significant profits in Q2 2008, largely contributing to the EUR 20.5m net financial income.

The company has maintained high liquidity and achieved outstanding results in raising financing. As of 30 June 2008 GTC held EUR 292m in cash and cash equivalents, while the long-term debt to total assets ratio was 37%.

In May 2008 GTC issued 5-year unsecured bonds with a face value of PLN 350m (approx. EUR 102m). The bond obligation in Polish zloty was swapped for Euro-denominated debt at a fixed interest rate, resulting in an effective interest cost of 6.63%.

A strong track record in execution of real estate projects, high quality of assets, low leverage, as well as long-established relations with leading European banks, have allowed GTC to secure financing under favourable terms for all projects under construction or soon to be started.

GTC continues its expansion in new markets. In May 2008 GTC Russia acquired a 50% interest in an office project in St. Petersburg which provides for development of 110,000 sqm of Class A offices.

In July 2008 GTC Ukraine purchased together with Europort Ltd a 14-hectare site in Odessa. The project, in which GTC Ukraine holds a 49.99% share, will include development of 120,000 sqm of office and logistics space.

In order to further strengthen GTC’s position in CIS markets, Globe Trade Centre S.A. purchased a 10% stake in Europort Ltd, which is a platform for developing real estate projects in Ukraine and Russia.

Currently the portfolio of pipeline projects under development includes approximately 2m sqm of net office, retail and residential space
(GTC’s stake)
, of which 1.5m is planned to be completed by the end of 2010.