GTC boosts its net profit by 76% in 2006

In 2006 Globe Trade Centre S.A. (GTC) achieved a record net profit of USD 253 million.The total portfolio of GTC’s investments – completed, under development or in the pipeline – now comprises 1.45 million square meters of commercial and residential space.

The best results in history

The year 2006 confirmed that GTC continues to accelerate on its growth path – the company achieved record financial results. Revenues from operations amounted to USD 101.5 million – 6% increase from the previous year, achieved despite the sale of 50% interest in Galeria Kazimierz and divestment of Mokotów Business Park. The increase resulted from completion of new office buildings, as well as from residential sales in Warsaw’s Osiedle Konstancja and in Riverloft in Budapest. In 2006 GTC delivered, fully let upon completion, class A office buildings: America House in Bucharest, Topaz in Warsaw, and Centerpoint II in Budapest, and expanded Warsaw’s Galeria Mokotow by 4,000 square meters. In Q4 2006 the Company recorded more than USD 25.3 million of revenues from operations.

GTC achieved even better results on the operating level. The profit from operations amounted to USD 297.6 million and was 52% higher than that in 2005. The net profit increased by 75.9% to USD 253 million in 2006 (vs USD 144m in 2005). In the last quarter of 2006 GTC’s net profit amounted to USD 19 million. “The last year proved again that GTC’s strategy is steering the Company in the right direction. We quite early identified the growth potentials of the most attractive markets in Central and Eastern Europe and established fully operating local structures there, and now we are geared to benefit from booming regional property markets. As a result, fast growing profits and GTC share price translates into increased shareholder’s value ” – says Eli Alroy, Chairman of the GTC Supervisory Board . In 2006 the company’s share price gained 132%, which was the best result among the WIG20 companies.

Also the scale of GTC’s investment expenditures was impressive. In 2006 the company acquired new projects that would allow development 725,000sqm of commercial and residential space. In total investments in land acquisition and development of new projects amounted to USD 266 million ( vs. USD 180 million in 2005).

Expansion accelerates

The last year was extremely successful for GTC, which significantly accelerated its expansion both in Poland and in other Central and Eastern European countries. ‘We have begun operations in three new markets, Bulgaria, Slovakia and Ukraine, and we have bought many plots for investments in other countries in the region,‘ said Hagai Harel, GTC Management Board Member responsible for CEE business development. ‘We have also rebalanced our property portfolio in Poland by selling older office buildings in Warsaw and speeding up new investments in other big cities in Poland.’

At present GTC is developing 260,000 square meters of net space in seven Polish cities, Warsaw, Cracow, Poznań, Wrocław, Katowice, Łódź and Częstochowa. Following Poland, GTC’s second-biggest investment market is Romania, where real estate market has been booming even before the recent EU accession on 1 January 2007. The portfolio of GTC investments in Romania that are completed or under development currently comprises 500,000 sqm of net office, retail and residential space. GTC’s share in these investments is over 300,000 sqm, as some of the projects are joint ventures.

The total portfolio of GTC’s completed, under development or pipeline projects (for which the land have already been purchased) comprises approx. 1.455 millionsqm of net office, retail and residential space.

In total, in 2006 GTC acquired 19 new investments with 725,000 sqm of potential building rights.

There has been a considerable increase in GTC’s activity in the residential sector. GTC’s pipeline comprise 8,000 apartments, of which GTC’s share is 4,300 units and the rest belonging to GTC’s partners in the projects. GTC’s success in the residential development was recognized by the CEE Real Estate Quality Award for Osiedle Konstancja (2nd phase) as the Best Housing Development in Central and Eastern Europe 2006.

GTC’s successful activity in the region has also been acknowledged by real estate experts. In 2006 GTC Romania was awarded the title of Developer of the Year in the South & Eastern Europe Real Estate Quality Awards contest. The Construction and Investment Journal awarded the prize for the Best Office Building and the Best Overall Development in Hungary in 2006 to Centerpoint in Budapest, which was completed in 2Q 2006.

Raising new equity helped to accelerate new acquisitions in 2006. In late March 2006, Globe Trade Centre S.A. successfully completed a secondary public offering, which was significantly oversubscribed, and raised USD 150 million. In December 2006, GTC’s subsidiaries sold Mokotów Business Park office buildings (GTC’s first investment in Poland) to funds managed by Heitman Property Partners. At a price of USD 287 million, this was one of the largest office transactions in the CEE property markets.

In August 2006, GTC conducted a 10-to-1 share split, which helped to improved liquidity, as trading volume in GTC shares grew by more than 60% y-o-yfollowing the split.

GTC’s shares has attracted interest of the leading global institutional investors, while the research coverage has been broadened. Now 10 leading Polish and international brokerage houses publish research report on GTC: CDM Pekao, BDM PKO BP, Unicredito CA IB, ING Securities, Citigroup Investment Research, Deutsche Bank Securities, KBC Securities, HSBC Global Research, and Morgan Stanley Research Europe.

Osiedle Konstancja Residential Estate is awarded as the best 2006 housing investment in Central and Eastern Europe

The Osiedle Konstancja residential estate (2nd phase), constructed by Globe Trade Centre S.A., has been awarded as the best housing investment of Central and Eastern Europe 2006 in the CEE Real Estate Quality Award contest.

Globe Trade Centre S.A. has obtained the CEE Real Estate Quality Award for the second phase of the Osiedle Konstancja residential estate – the prestigious housing estate now under development in Konstancin Jeziorna.

The Quality Awards gala was traditionally held in Warsaw’s InterContinental hotel. Representatives of the real estate sector from 10 Central and Eastern European countries and visitors from all over the world attended this outstanding event.

GTC SA Director General Piotr Kroenke accepted the award on GTC’s behalf. The best projects of the year 2006 were voted on by a 13-member jury with renowned experts of the real estate sector of Central and Eastern Europe.

The winning Osiedle Konstancja residential estate is one of the most prestigious housing investments in Warsaw. Osiedle Konstancja is situated in an attractive area in the town of Konstancin Jeziorna near Warsaw and it is adjacent to the exclusive American School, on the way linking Warsaw with Konstancin. The second phase was designed by dip Dziuba i Pasternak architectural lab and it entails 74 housing units. The whole second phase of Osiedle Konstancja has been sold and currently construction works are underway on the estate’s third phase. The developer has already started work on two new phases of the investment.

The third phase of Osiedle Konstancja will involve the construction of 36 modern single-family and semi-detached homes with spacious gardens and terraces. The deadline for the homes to be opened is January 2008.

For more information about Osiedle Konstancja see

GTC Acclaimed as Forbes Diamond

Globe Trade Centre S.A. (GTC) is found a Forbes Diamond. The company has been awarded the first place in the ranking of the most valuable big Polish enterprises

Globe Trade Centre S.A. has won the first place in the “Big Enterprises” category of the Forbes magazine’s “Most Valuable Firms Ranking”. The firm has reached the top among those Polish enterprises with the quickest increase in value, called FORBES DIAMONDS.

The FORBES magazine’s ranking has been created in co-operation with DUN&BRADSTREET, the world’s leading provider of business information which has gathered and analysed the firms’ financial results of the past three years and has applied a Swiss evaluation method that reflects firms’ growth potential in the future.

Placed at No 1 position, Globe Trade Centre has recorded a 65% average increase in value in the years 2003-2005. Among the 49 most valuable companies with a turnover exceeding PLN 200 million in 2005 are such companies as PKN Orlen, TVN an KGHM Polska Miedz.

GTC hailed as WIG20 index best

The Warsaw stock exchange-listed Globe Trade Centre S.A. (GTC) has been awarded the Bull & Bear trophy and found as the best stock exchange investment on WIG20.

The award ceremony of the 13th ”Bulls & Bears” contest was held on 6 February this year in the Listings Room of the Warsaw Stock Exchange. Representatives of the world of business, politics and chief executives of the stock exchange-listed companies attended this prestigious gala. Government representatives were honorary guests of the event including Deputy Prime Minister and Finance Minister Ms Zyta Gilowska, Economy Minister Mr. Piotr Wozniak, and Vice-Minister of the Treasury Mr. Ireneusz Dabrowski.

GTC Director General Mr. Piotr Kroenke accepted the award from the hands of Minister Gilowska and Minister Wozniak. In his statement, Mr. Kroenke thanked for this prestigious award and emphasized that the company’s success owes credit to international work of the GTC staff. Also, he promised that the firm would do all its best to repeat this year’s success again next year.

Bulls & Bears is the most prestigious award granted to companies listed on the Warsaw stock exchange. With a 13-year-long history, it has achieved the status of ”Business Oscars”. Apart from GTC, this year’s winners are Prof. Leszek Balcerowicz, as special award winner, and Energopol Poludnie, CEZ, ATM, PBG, OFE Polsat, and BZ WBK AIB TFI.

The official gala this year witnessed also the second Golden Portfolios awards for the best investment fund managers.