Company announcement no. 6/2013

Aalborg, Denmark, 2013-03-11 12:06 CET (GLOBE NEWSWIRE) -- 

Summary:

TK Development’s Supervisory Board has decided to revise the Group’s strategy
and business model, and thus expects over time to increase the Group's ability
to create value and restore a viable business model. An essential element of
the revised strategy and business model is the focus on two business arms: a
primary business arm focusing on property development activities and a
secondary arm focusing on asset management activities. In addition, the future
market focus will be changed to retail – and, in part, office - and residential
projects in Denmark, Sweden, Poland and the Czech Republic, whereas the
activities in Germany, Russia, Finland and the Baltic States will be
discontinued in the short to medium-long term. The plan is also to bring down
the Group’s portfolio of non-initiated projects (plots of land) of about DKK
1.1 billion to a level of about DKK 0.5 billion over the next two years, which
will result in a reduction of the capital tied up so as to allow the startup of
new projects that will generate an attractive profit. The sale of major,
completed and matured projects is still proceeding, and coupled with the
scale-down of activities in several countries and the reduction of projects not
yet initiated, this will improve the Group’s solvency. The Group will
strengthen its risk management by striving exclusively to launch projects based
on a strict awareness that the expected earnings will match the project’s
complexity, completion time, tied-up capital and other use of resources. The
Group’s internal and external reporting will be realigned so as to reflect the
activity and development of the two business arms, as well as the phase-out of
activities in the above-mentioned countries where business will be
discontinued. Cost cuts with an effect of about 20 % will be made, expected to
have a full impact within a 12-month period. 

The resolved strategy revision will not result in any adjustment of the results
estimate announced for the 2012/13 financial year. 



Contact information:

TK Development A/S

Frede Clausen, President and CEO

T: +45 2090 8770