If there is too much debt, especially in the opinion of a credit rating agency, the cost of debt is too high in relation to the return on investments, i.e., real estate. So there must be a suitable amount of debt, at a suitable price.
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As a fun curiosity, today the 3.8 price set for own purchases was exceeded, meaning either the marketing talk worked well or it has risen to that level due to share buybacks. 
But the point is that if it stays above this, then those purchases probably won’t be made, if I interpret the announcement correctly.
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It has been a very welcome development in the share valuation. I suppose, in addition to that announcement from 13.5.25, it should still be announced if the buyback program were actually started?
From the announcement: The preliminary size of the share acquisition is planned to be a maximum of 12 million shares and the price 3.80 euros per share. The company’s Board of Directors has the right to adjust the price based on its free discretion.
I would rather interpret those sentences to mean that a floor is set for the price, if, for example, a directed acquisition of shares from the main owner has been considered. However, it was also written in the announcement that the current share price (approx. 3.56 on 13.5) does not fully reflect the true value of the company’s assets, so it’s hard to see how a 7% increase would, in the company’s view, make the share overpriced.
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“The Board of Directors of Citycon Oyj (“Citycon” or the “Company”) has decided to launch a share buyback program and commence the acquisition of the Company’s own shares (ISIN code FI4000369947) pursuant to the authorization granted by Citycon’s Annual General Meeting on April 3, 2025. The shares are acquired to distribute excess funds received from divestments made in 2024 to Citycon’s shareholders and to create additional value in the future. The Company believes that the reduction in the number of shares as a result of the buyback and the cancellation of the repurchased shares after the program concludes is the most favorable option for the Company to achieve a more efficient capital structure.”
"* The maximum number of shares to be acquired is 12,000,000, which corresponds to approximately 6.5% of the total number of Citycon’s shares. A maximum of EUR 45.6 million will be used for the buyback.
- Shares will be acquired in one or more tranches through public trading on Nasdaq Helsinki Oy (“Nasdaq Helsinki”) at the market price at the time of acquisition, but not at a price higher than EUR 3.80 per share (“Maximum Price”). The Maximum Price is final and will not be increased. Shares acquired under the program will be acquired otherwise than in proportion to the shareholdings of the Company’s shareholders (directed acquisition).
- The acquisition of shares will commence no earlier than June 23, 2025, and will end no later than July 11, 2025. Citycon’s Board of Directors may, at its discretion, decide to extend the buyback period.
- The maximum daily number of shares to be repurchased is 2,000,000 shares.
- The acquisition price will be paid entirely with the Company’s unrestricted equity. The acquisition of own shares will thus reduce the Company’s unrestricted equity, and the acquisitions will be recorded as deductions from accumulated earnings.
- The acquisition price of the repurchased shares will be paid against the delivery of the repurchased shares, and share trades will be settled according to the normal settlement schedule defined in Nasdaq Helsinki’s trading rules. Share trades will be communicated in accordance with Nasdaq Helsinki’s rules.
- The repurchased shares will be cancelled and delisted from Nasdaq Helsinki after the Company has announced the conclusion of the buyback program."
The time window for the now announced program ends in just a few weeks. Is there a closed window when Q2 report figures start to form, or why does it have to end already in July?
Indeed, private investors still have to worry about the financing and implementation of divestments, but hopefully, the company’s management and main owner have the situation under control and better visibility. IF Citycon can divest a few properties at even an okay price, then this is again pure money printing. I have to appreciate it when they directly state that they are creating added value and optimizing the capital structure WHEN THE SHARES ARE CANCELLED after the program 
. Usually, these announcements leave it open whether the shares will actually be cancelled, or if they will be saved to be distributed to management in the future or used for bad acquisitions.
Naturally, the figures contain all sorts of pitfalls from adjustments to hybrid bonds 
, but reflecting on the closing price of the previous trading day, share buybacks could be made now
- P/B = 3.75 € / 8.13 € = 0.46
- PE = 3.75 € / ((0.41+0.5)/2) € = 8.2
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Well, there’s the ceiling price then. Isn’t this a rather exceptional buyback program when the sum is enormous compared to the daily trading volume and the acquisition time is only a couple of weeks… How on earth can they even get a significant portion of that together if the price isn’t allowed to rise by more than a few cents. According to my own logic, that will practically raise the price to the 3.8 level and they’ll be able to pick up tens of thousands of shares here and there per day.
Well, at least there’s a buyer now for everyone who wants to sell, as trading has otherwise been quite negligible.
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Most likely, the seller is already known (perhaps the main owner?) and the deals are made outside the stock exchange.
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Certainly so.. So, in practice, a targeted acquisition of shares from the main owner is indeed considered the best way to distribute the proceeds from divestments to shareholders, as stated in the release. Well, this has been seen too, no other comes to mind immediately.
This could even be complemented in the autumn by a targeted share issue to the main owners with a small discount to strengthen the balance sheet and ensure an investment grade rating.
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I quickly googled that last time(?) Gazit subscribed to shares at a price of €4.05 in a targeted share issue. Add a couple of dividends on top of that, presumably, and we are probably quite close to €3.8 prices if Gazit wants to break even on the shares it subscribed to.
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One seller identified, it wasn’t Gazit.
F. Scott Ball sold 100,000 shares at a price of €3.8.
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The share buybacks were modest, but at least the maximum price was not exceeded.
“Citycon acquired a total of 694,801 own shares between June 23, 2025, and July 11, 2025, which corresponds to approximately 0.4 percent of Citycon’s total number of shares. The shares were acquired at an average price of approximately 3.8 euros per share. A total of approximately 2.6 million euros was used for the repurchase.”
Target: “The maximum number of shares to be acquired is 12,000,000, which corresponds to approximately 6.5% of Citycon’s total number of shares.”
They also state in the release that the shares will be cancelled. Let’s see if they try to acquire more shares in the autumn?
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The company no longer interests anyone, which is quite a bullish thing. Long.
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Indeed. Not a word about the earnings report on Kauppalehti’s forum, Sijoitustieto, or Shareville. Well, I don’t own the stock anymore either.
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It’s difficult to understand from the result whether it was good or bad? Citycon’s own text is positive, as is customary.
Practically, worse numbers in every column than Q2/24.
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During the first half of 2025, Citycon’s operational figures continued to develop
How did they develop? I went through the columns of the release, and the only positive change was in the loan-to-value ratio. London’s bullshit translator doesn’t quite cut it.
What’s positive here, compared to Qt’s stock, is real defensive profit. The entire investment case is based on the idea that one day properties can be exchanged for euros again, and shopping centers will have to be bought at a one-for-one price. Meanwhile, cash flow is generated, debts are repaid, and own shares are bought back cheaply. It’s a shame that the “buy 2 pay 1” offer in debt repurchases was completely bypassed by distributing all profits as dividends to the cat man.
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Yeah, it’s grim. In earnings reports, things are always painted as having progressed wonderfully, but once you get past the first few sentences in the report, the truth is revealed. Indeed, almost all indicators are in the red.
Pros: development of loan maturity and loan-to-value ratio. Increase in property values.
Cons (biggest): increase in loan costs, downgrade of credit rating, operational figures.
Still on board, even though confidence is low. Luckily, it’s only a small part of the portfolio. Hang in there, fellow owners.
Well, I guess in the conference call, debts will again be talked into receivables… 
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Reading Citycon’s reports is quite painful.
Previously, they talked about “adjusted” figures. Now they talk about “profit without hybrid bond interest expenses” 
Usually, income without expenses has also been called “revenue” 
The earnings report wasn’t pretty, but operationally, Citycon’s business continues at an OK level:
Not many saw this beforehand:
I myself wondered about zero interest rates for years and years, but when interest rates started to be raised, all experts were of the opinion that interest rates in Europe could not be raised above ~3% or Southern Europe would be bankrupt.
Well, we got the fastest interest rate hike in modern monetary history, and rates were instantly raised to 17-year highs! No wonder the real estate and construction sectors plunged, and this hangover had to be digested.
But this hangover has continued surprisingly long. Interest rates have fallen to a quite reasonable level, financial assets are higher than ever before. Real estate and land are not printed more by politicians or bankers, and Citycon has properties with almost full occupancy already for sale.
Citycon also seemed to have the same story as all other listed companies; it will pick up by the end of the year! It’s rarely told which year’s end of year, the same story continues year after year.
Citycon’s share price is currently €3.74
P/B = €3.74 / €8.29 = 0.45
This year’s EPS EPRA €0.41-0.5
P/E = €3.74 / €0.455 = 8.2
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The development of the numbers also caught my eye; I would have been more interested in the development of the business. Perhaps that headline will end up as a quote in some communication course’s PowerPoint.
I didn’t find any major surprises in the report, just as the market didn’t based on the share price reaction.
Before the earnings report, I tried to guess what might be in it, and with the investment I planned for a boring company, there have been so many coincidences that I decided to sell everything off. It feels like a relatively small position and somewhat of a gamble. With a different ownership structure, communication, profit distribution, share issues, share buybacks, etc., it would be more interesting to my taste.
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If I calculated correctly, Citycon’s hybrid buybacks reduce interest expenses by a little over €2 million per year. So, as an alternative to buying back own shares, that too is a better way to
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