TAMFELT CORP. STOCK EXCHANGE RELEASE August 9, 2007 at 3.00 p.m. TAMFELT'S INTERIM REPORT JANUARY-JUNE 2007 Net sales improved 7.2% compared to the same period in 2006. - Net sales 85.0 million euros (1-6/2006: 79.3) (1-12/2006: 155.0) - Operating profit 11.7 million euros (1-6/2006: 11.7) (1-12/2006: 25.9) - Operating profit 13.7% of net sales (1-6/2006: 14.8) - Income before taxes and minority interest 11.7 million euros (1-6/2006:11.6) - Earnings per share 0.31 euros (1-6/2006: 0.31) - Net cash flow from operating activities 9.7 million euros (1-6/2006: 15.7) - Equity per share 3.59 euros (6/2006: 3.48) - Equity to assets ratio 60.7% (6/2006: 63.8) - Return on net assets 20.4% (6/2006: 21.6) - Return on equity 16.8% (6/2006: 17.5) - Short-term outlook: Tamfelt's full year net sales are expected to be higher than in 2006 and the operative results for the year are expected to remain at a good level. Tamfelt is a world-leading supplier of technical textiles. The Group's main products are fabrics for the pulp and paper, mining, and chemical industries Other products include laundry felts and dry filtration media. OPERATING ENVIRONMENT AND DEMAND FOR TAMFELT PRODUCTS The demand for paper and board continued to grow in the first half of 2007. The growth was still strongest in China and other Asia, but also in Western Europe the demand has increased compared to the first half of 2006. The price of long-fibered pulp has improved, as well as the prices of board and newsprint paper, but the prices of other paper grades have in average remained fairly stable. The market situation of metals influences the demand of filter fabrics. The demand and prices of the most important metals were good, although there has been continued short-term fluctuation in prices. An exception of the price trends is nickel, the price of which has been going down since May. In spite of the positive market situation, the demand for paper machine clothing did not grow, except in China and the rest of Asia. In the long term, the development of the clothing market follows the trend of the paper market. Clothing consumption will grow slower, however, than paper production volumes. This is because improved clothing types are being developed to enhance the papermaking process. The new clothing types are also more durable than the old ones, thus providing longer running lives. The specific consumption of clothing (consumption per ton of paper produced) also keeps going down as a result of the technical development, as new paper machines are being built and old, less efficient ones, closed down. Average prices of paper machine clothing in January-June 2007 were lower than the year before, and competition in the field was tougher due to cost savings programs of customer companies. Paper and board mills sought to reduce their inventories further, which means the clothing suppliers must prepare for faster deliveries. Trouble-free run of the clothing and reaching the planned running lives are essential when the customers strive for more efficient processes. Successful co-operation with the customers and machinery manufacturers to reach these targets gives the clothing supplier an opportunity to strengthen his market position. Clothing suppliers are building new capacity in Asia and closing down inefficient units elsewhere in the world. Capacity is concentrated by investing in large, efficient production units and closing down smaller ones. The market situation of filter fabrics for the paper and pulp industries during the report period was good and the demand was on a higher level than in the first half of 2006. The demand for filter fabrics delivered to the mining and chemical industries was at the same level as in the corresponding period in 2006. The market situation of filter fabrics for the energy industry was good and demand increased, particularly in China. The fluctuation of oil prices leads to increased use of coal as energy and to developing alternative sources of energy. In reducing emissions from the use of coal, high-quality filter fabrics are key. Increased production of biofuels also needs filtration media. In addition, the generally tightening environmental regulations have increased the demand for filter fabrics, and this trend will continue in the near future. The demand for laundry felts continued good. There was lack of fibers used in specialty fabrics which caused difficulties in manufacturing certain laundry felt types and dry filtration media. The weak exchange rate of the US dollar against the euro weakened the profitability of exports from Western Europe to North America and Asia. PROFIT PERFORMANCE AND FINANCIAL POSITION The net sales of Tamfelt Group in January-June 2007 were 85.0 million euros (79.3 in 1-6/2006). This is 7.2% higher than in the same period in 2006. Delivery volumes increased more than the net sales. Of the net sales during the period, 30% (36) originated in Finland, 42% (44) in other Europe, and 28% (20) in other countries. The Group's operating profit 11.7 million euros (11.7) was 13.7% (14.8) of net sales. The net profit for the period was 8.7 million euros (8.6). Return on net assets was 20.4% (21.6) and return on equity was 16.8% (17.5). Earnings per share were 0.31 euros (0.31). Increasing productivity and sales volumes compensated for the effect of lower prices to the results. Increasing market shares have been made possible by successful long-term R&D, and customer-focused approach. Decreasing price level has been fought by bringing new competitive products into the market. Productivity has been improved through timely investments and by developing processes and work procedures. Even stronger concentration on chosen strategic segments has also contributed to improved profitability. The consolidated balance sheet total was 164.9 million euros (151.1) at the end of the period. Equity amounted to 99.5 million euros (96.2). Equity to assets ratio was 60.7% (63.8) and gearing 13.2% (3.3). The amount of interest bearing liabilities at the end of June was 25.5 million euros (14.8), and book value of cash and cash equivalents was 12.3 million euros (11.7). The Group's net financial items totaled 0.1 million euros (-0.1). Net cash from operating activities was 9.7 million euros (15.7), and cash flow before financing items was -1.1 million euros (13.1). Tamfelt's order backlog is good, but orders continue to distribute unevenly between the various product groups. OPERATIONS The sales of paper machine clothing developed well in North America and in Asia, especially in China, as well as in Western Europe. Tamfelt's delivery volumes increased, although the total demand for clothing decreased. Tamfelt has received start-up orders for 2007 both from China and from Europe. The demand of press felts and shoe press belts, in particular, continued good. The demand for dryer fabrics has also improved from last year. The sales of filter fabrics improved in all market areas. Tamfelt focuses on chosen target segments. One of these is clothing for large, fast paper and board machines, and Tamfelt has been able to increase its market share clearly in this segment. During the report period, Tamfelt clothing contributed, for example, to a new SC paper world speed record, 1901 m/min. The company has strengthened its market position also in chosen filter fabric segments, such as dry filtration media where the sales have grown strongly during the report period. In fabrics for pulp mill caustisizing applications and for iron pelletizing plants, as well as in laundry felts, Tamfelt is the market leader. A growing segment is fabrics for filtration applications in coal power plants. The customers are showing increased interest in Tamfelt's spearhead products. The share of Gapmaster and Packmaster triple layer forming fabrics out of the forming fabric production already exceeds 70%. The production volumes of TMO and SMO press fabrics are also constantly increasing. Earlier this year, Tamfelt launched the patented HiSpeed forming fabric designed especially for fast paper machines. Running experiences from paper machines have been very encouraging and orders are flowing in. The new shoe press belt, Tambelt 3G has also aroused interest among the customers. The wear resistance of this product is excellent, thanks to a triple layer reinforcement structure. The share of spearhead products out of all deliveries exceeds 40%. INVESTMENTS The Group's gross investments during the first six months of 2007 were 10.8 million euros (2.6). The largest investments now in process are increasing the press felt production capacity in Tampere plant, and building a fabric factory in China. The new needling loom, representing state-of-the-art technology, will be taken into use in press felt production in fall 2007. Other investments to enhance press felt capacity were completed during the report period. Tamfelt's filter fabric factory in Shanghai, China, started up in January 2007. The new unit produces and sells filter fabrics for both wet and dry filtration in China and the Southeast Asian market. Further investments in the factory are due later on. The building of a factory making forming and dryer fabrics in Tianjin, China, was started during the report period and the work is progressing as expected. Production in the factory is due to start during the first quarter of 2008. After completed, the new factory will improve Tamfelt's delivery ability, logistics, and competitiveness in the long term. Special attention has been paid in the Group to making the information systems compatible. Incorporating the subsidiaries into the Group's SAP resource planning system continues. The target is to have all units included by the end of 2007. A common system will improve business planning, monitoring, and intelligence. PERSONNEL At the end of June, the Group employed 1,464 (1,408) people. The number is 56 people higher than in June 2006. The increase has taken place in the Tampere and Shanghai units. At the end of 2006, the number of personnel was 1,443. Of Tamfelt personnel, 73% work in Finland and 27% in other countries. SHARES AND SHARE CAPITAL Tamfelt's share capital consists of common shares and preferred shares. The accounting par value of both types of share is 1.00 euro. Preferred shares collect two per cent units higher dividend than common shares, calculated on the accounting par value. A common share carries 20 votes and a preferred share carries 1 vote. In Janauary-June, preferred shares traded in OMX Nordic Exchange Helsinki for 11.6 million euros (13.8) and common shares for 1.6 million euros (1.9). The trading volume of preferred shares was 5.8% (9.0) of their total volume. The corresponding figure on common shares was 1.4% (2.1). At the end of June, the closing price per preferred share was 11.60 euros and per common share 11.90 euros. The price increase per preferred share since the beginning of the year was 8.9% and per common share 12.1%. The highest price per preferred share in January-June was 12.88 euros and the lowest price 10.13 euros. The highest price per common share was 12.75 euros and lowest 10.51 euros. Tamfelt's total market capitalization as of June 30, 2007 was 322.8 million euros (241). Tamfelt's share capital was 27,563,964 euros. The total number of shares was 27,563,964, of which common shares number 10,119,198 and preferred shares 17,444,766. SHAREHOLDERS Tamfelt's largest ownership registrations by number of shares on June 30, 2007: -------------------------------------------------------------------------------- | 1. | Ilmarinen Mutual Pension Insurance Company | 7.4% | -------------------------------------------------------------------------------- | 2. | Varma Mutual Pension Insurance Company | 5.9% | -------------------------------------------------------------------------------- | 3. | Tapiola Mutual Pension Insurance Company | 3.9% | -------------------------------------------------------------------------------- | 4. | Svenska litteratursällskapet i Finland r.f. | 2.9% | -------------------------------------------------------------------------------- | 5. | Sampo Life Insurance Company | 2.9% | -------------------------------------------------------------------------------- | 6. | Metso Corporation | 2.6% | -------------------------------------------------------------------------------- | 7. | Waldemar von Frenckell Foundation | 2.6% | -------------------------------------------------------------------------------- | 8. | Samfundet Folkhälsan i Svenska Finland r.f. | 2.2% | -------------------------------------------------------------------------------- | 9. | Juselius Sigrid Foundation | 2.1% | -------------------------------------------------------------------------------- | 10. | Cedercreutz Axel | 1.7% | -------------------------------------------------------------------------------- | | Total | 34.2% | -------------------------------------------------------------------------------- At the end of June, Tamfelt had a total of 3,198 shareholders. Foreign ownership including registrations in name of nominee amounted to 4.6% (5.3) of shares. SHORT-TERM OUTLOOK Demand for paper is expected to keep growing, which will have a positive effect on clothing consumption. In the mining industry, the market situation of iron and color metals is expected to continue good, and demand for filter fabrics is expected to increase. The generally tightening environmental regulations will also have a positive effect on the demand for filter fabrics. The investment decisions already made and input in internationalization will increase the investment expenses significantly in 2007. Special attention will continue to be paid to capital efficiency, innovativeness, and improving productivity. The trade union agreements for the textile and confection industry in Finland will end on September 30, 2007 which provides some uncertainty for the last quarter of the year. Tamfelt's full year net sales are, however, expected to grow from 2006 and the operative results for the year are expected to remain at a good level. No one-time income is expected, however, like the one from the sales of water power company Alakoski Oy last year. The profit from the sales of Alakoski Oy in the last quarter of 2006 was 0.07 euros per share. Juankoski, Finland, August 9, 2007 TAMFELT CORP. Board of Directors Anne Paloheimo-Seppänen Communications Manager The results are unaudited. -------------------------------------------------------------------------------- | CONSOLIDATED INCOME | | | | | | | | STATEMENT, IFRS | | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | | 1-6 | | 1-6 | | 1-12 | | -------------------------------------------------------------------------------- | Million euros | 2007 | % | 2006 | % | 2006 | % | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Net sales | 85.0 | 100 | 79.3 | 100 | 155.0 | 100 | -------------------------------------------------------------------------------- | Operating profit | 11.7 | 14 | 11.7 | 15 | 25.9 | 17 | -------------------------------------------------------------------------------- | Financial income and | 0.1 | | -0.1 | | 0.3 | | | expenses | | | | | | | -------------------------------------------------------------------------------- | Share of the income of | | | 0.0 | | | | | associated companies | | | | | | | -------------------------------------------------------------------------------- | Profit before tax | 11.7 | | 11.6 | | 26.2 | | -------------------------------------------------------------------------------- | Income tax | -3.0 | | -3.1 | | -6.1 | | -------------------------------------------------------------------------------- | Profit for the period | 8.7 | 10 | 8.6 | 11 | 20.1 | 13 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Attributable to | | | | | | | -------------------------------------------------------------------------------- | Equity holders of the | 8.7 | | 8.6 | | 20.2 | | | parent | | | | | | | -------------------------------------------------------------------------------- | Minority interest | 0.0 | | 0.0 | | -0.1 | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Earnings per share | | | | | | | | calculated on | | | | | | | | profit | | | | | | | | attributable to equity | | | | | | | | holders of the parent | | | | | | | | (euro) | | | | | | | -------------------------------------------------------------------------------- | Basic | 0.31 | | 0.31 | | 0.73 | | -------------------------------------------------------------------------------- | Diluted | 0.31 | | 0.31 | | 0.73 | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | CONSOLIDATED BALANCE SHEET, | | | | | | | | IFRS | | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Million euros | 6/2007 | % | 6/2006 | % | 12/2006 | % | | | | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Assets | | | | | | | -------------------------------------------------------------------------------- | Non-current assets | | | | | | | -------------------------------------------------------------------------------- | Property, plant and | 81.9 | | 71.2 | | 75.8 | | | equipment | | | | | | | -------------------------------------------------------------------------------- | Goodwill | 0.3 | | 0.3 | | 0.3 | | -------------------------------------------------------------------------------- | Other intangible assets | 4.0 | | 3.7 | | 4.0 | | -------------------------------------------------------------------------------- | Investments in associates | | | 0.3 | | | | -------------------------------------------------------------------------------- | Other financial items | 1.6 | | 1.7 | | 1.8 | | -------------------------------------------------------------------------------- | Deferred tax assets | 0.7 | | 0.5 | | 0.6 | | -------------------------------------------------------------------------------- | | 88.5 | 54 | 77.7 | 51 | 82.5 | 54 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Current assets | | | | | | | -------------------------------------------------------------------------------- | Inventories | 31.4 | | 31.9 | | 32.1 | | -------------------------------------------------------------------------------- | Trade and other receivables | 32.7 | | 29.8 | | 29.2 | | -------------------------------------------------------------------------------- | Financial assets at fair | 2.0 | | 1.5 | | 1.8 | | | value | | | | | | | | through profit or | | | | | | | | loss | | | | | | | -------------------------------------------------------------------------------- | Cash and cash equivalents | 10.3 | | 10.2 | | 8.0 | | -------------------------------------------------------------------------------- | | 76.4 | 46 | 73.4 | 49 | 71.1 | 46 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Total assets | 164.9 | 100 | 151.1 | 100 | 153.6 | 100 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Equity and liabilities | | | | | | | -------------------------------------------------------------------------------- | Issued capital and | | | | | | | | reserves | | | | | | | | attributable to | | | | | | | | equity holders of | | | | | | | | the parent | | | | | | -------------------------------------------------------------------------------- | Share capital | 27.6 | | 27.6 | | 27.6 | | -------------------------------------------------------------------------------- | Share premium reserve | 1.0 | | 1.0 | | 1.0 | | -------------------------------------------------------------------------------- | Translation differences | -0.9 | | -0.3 | | -0.5 | | -------------------------------------------------------------------------------- | Fair value reserve | 0.4 | | 0.5 | | 0.5 | | -------------------------------------------------------------------------------- | Retained earnings | 70.9 | | 67.2 | | 79.0 | | -------------------------------------------------------------------------------- | | 99.0 | | 96.0 | | 107.6 | | -------------------------------------------------------------------------------- | Minority interest | 0.5 | | 0.2 | | 0.2 | | -------------------------------------------------------------------------------- | Total equity | 99.5 | 60 | 96.2 | 64 | 107.8 | 70 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Non-current liabilities | | | | | | | -------------------------------------------------------------------------------- | Deferred tax liabilities | 10.9 | | 11.0 | | 10.9 | | -------------------------------------------------------------------------------- | Interest-bearing | 11.8 | | 5.1 | | 1.8 | | | liabilities | | | | | | | -------------------------------------------------------------------------------- | | 22.7 | | 16.1 | | 12.7 | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Current liabilities | | | | | | | -------------------------------------------------------------------------------- | Trade and other payables | 29.0 | | 28.6 | | 29.8 | | -------------------------------------------------------------------------------- | Provisions | 0.0 | | 0.5 | | 0.0 | | -------------------------------------------------------------------------------- | Current interest-bearing | 13.7 | | 9.7 | | 3.3 | | | liabilities | | | | | | | -------------------------------------------------------------------------------- | | 42.7 | | 38.8 | | 33.1 | | -------------------------------------------------------------------------------- | Total liabilities | 65.4 | 40 | 54.9 | 36 | 45.8 | 30 | -------------------------------------------------------------------------------- | Total equity and | 164.9 | 100 | 151.1 | 100 | 153.6 | 100 | | liabilities | | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | CONSOLIDATED CASH FLOW | | | | | | | STATEMENT | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | | 1-6 | | 1-6 | | 1-12 | -------------------------------------------------------------------------------- | Million euros | 2007 | | 2006 | | 2006 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Operating activities | | | | | | -------------------------------------------------------------------------------- | Profit for the period | 8.7 | | 8.6 | | 20.1 | -------------------------------------------------------------------------------- | Adjustments to profit | 8.3 | | 7.2 | | 12.6 | -------------------------------------------------------------------------------- | Change in working capital: | | | | | | -------------------------------------------------------------------------------- | Change in trade and other | -3.4 | | -1.2 | | -0.5 | | receivables | | | | -------------------------------------------------------------------------------- | Change in inventories | 0.6 | | 0.3 | | 0.1 | -------------------------------------------------------------------------------- | Change in trade and other | -0.7 | | 4.2 | | 5.4 | | payables | | | | | | -------------------------------------------------------------------------------- | Change in provisions | | | | | -0.5 | -------------------------------------------------------------------------------- | Interest received | 0.1 | | 0.1 | | 0.2 | -------------------------------------------------------------------------------- | Interest paid | -0.3 | | -0.2 | | -0.6 | -------------------------------------------------------------------------------- | Other financial items, net | -0.2 | | 0.0 | | 0.4 | -------------------------------------------------------------------------------- | Taxes paid | -3.4 | | -3.3 | | -5.5 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Net cash from operating | 9.7 | | 15.7 | | 31.7 | | activities | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Investing activities | | | | | | -------------------------------------------------------------------------------- | Acquisition of subsidiaries less cash | | | and cash equivalents at | | | acquisition date | | -------------------------------------------------------------------------------- | Investments in property, plant | -10.8 | | -2.6 | | -10.8 | | and equipment | | | | | | -------------------------------------------------------------------------------- | Investments in intangible assets | | | | -0.7 | -------------------------------------------------------------------------------- | Sales of associates | | | | | 2.3 | -------------------------------------------------------------------------------- | Net cash from investing | -10.8 | | -2.6 | | -9.2 | | activities | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Financing activities | | | | | | -------------------------------------------------------------------------------- | Subscription for stock options | | | 0.1 | | 0.1 | -------------------------------------------------------------------------------- | Withdrawal of loans | 22.0 | | 11.0 | | | -------------------------------------------------------------------------------- | Repayment of loans | -1.7 | | -9.0 | | -9.0 | -------------------------------------------------------------------------------- | Dividends paid | -16.6 | | -11.1 | | -11.1 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Net cash from financing | 3.7 | | -9.0 | | -20.0 | | activities | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Change in cash and cash | 2.6 | | 4.1 | | 2.5 | | equivalents | | | | | | -------------------------------------------------------------------------------- | Cash and cash equivalents at | 9.8 | | 7.7 | | 7.7 | | the beginning | | | | | of period -------------------------------------------------------------------------------- | Effect of exchange rates | 0.0 | | -0.3 | | -0.2 | -------------------------------------------------------------------------------- | Effect of changes in the fair | -0.1 | | 0.2 | | -0.2 | | value | | | | | | | of investments | | | | | | -------------------------------------------------------------------------------- | Cash and cash equivalents at | 12.3 | | 11.7 | | 9.8 | | the end of period | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | STATEMENT OF CHANGES IN | | | | | | | | EQUITY | | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | | Equity attributable to shareholders of the parent | | -------------------------------------------------------------------------------- | Million euros | Sha | Shar | Tran | Fair | Retai | Total | Minor | Total | | | re | e | slat | value | ned | | ity | equity | | | cap | prem | ion | reser | earni | | inter | | | | ita | ium | diff | ve | ngs | | est | | | | l | rese | eren | and | | | | | | | | rve | ces | other | | | | | | | | | | reser | | | | | | | | | | ves | | | | | -------------------------------------------------------------------------------- | Equity Dec. 31, | 27. | 1.0 | 0.1 | 0.8 | 69.8 | 99.2 | 0.3 | 99.4 | | 2005 | 6 | | | | | | | | -------------------------------------------------------------------------------- | Translation | | | -0.4 | | | -0.4 | | -0.4 | | differences | | | | | | | | | -------------------------------------------------------------------------------- | Change in fair value, | | -0.5 | | -0.5 | | -0.5 | | available-for-sale | | | | | | | | investments | | | | | | | -------------------------------------------------------------------------------- | Tax on equity items | 0.1 | | 0.1 | | 0.1 | -------------------------------------------------------------------------------- | Counter entry of share-based payments | 0.0 | 0.0 | | 0.0 | -------------------------------------------------------------------------------- | Profit for the | | | | | 8.6 | 8.6 | 0.0 | 8.6 | | period | | | | | | | | | -------------------------------------------------------------------------------- | Total recognized | | -0.4 | -0.4 | 8.6 | 7.8 | 0.0 | 7.8 | | income | | | | | | | | | and expenses | | | | | | | | | for the | | | | | | | | | period | | | | | | | | -------------------------------------------------------------------------------- | Dividends | | | | | -11.1 | -11.1 | | -11.1 | -------------------------------------------------------------------------------- | Stock options | 0.0 | 0.1 | | | | 0.1 | | 0.1 | | excercised | | | | | | | | | -------------------------------------------------------------------------------- | Equity June 30, | 27. | 1.0 | -0.3 | 0.5 | 67.2 | 96.0 | 0.2 | 96.2 | | 2006 | 6 | | | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Equity Dec. 31, | 27. | 1.0 | -0.5 | 0.5 | 79.0 | 107.6 | 0.2 | 107.8 | | 2006 | 6 | | | | | | | | -------------------------------------------------------------------------------- | Translation | | | -0.4 | | | -0.4 | 0.3 | -0.1 | | differences | | | | | | | | | -------------------------------------------------------------------------------- | Change in fair value, | | -0.2 | | -0.2 | | -0.2 | | available- | | | | | | | | for-sale | | | | | | | | investments | | | | | | | -------------------------------------------------------------------------------- | Tax on equity items | 0.0 | | 0.0 | | 0.0 | -------------------------------------------------------------------------------- | Counter entry for share-based payments | 0.0 | 0.0 | | 0.0 | -------------------------------------------------------------------------------- | Profit for the | | | | | 8.7 | 8.7 | 0.0 | 8.7 | | period | | | | | | | | | -------------------------------------------------------------------------------- | Total recognized | | -0.4 | -0.1 | 8.7 | 8.2 | 0.3 | 8.5 | | income | | | | | | | | | and expenses | | | | | | | | | for the | | | | | | | | | period | | | | | | | | -------------------------------------------------------------------------------- | Dividends | | | | | -16.6 | -16.6 | | -16.6 | -------------------------------------------------------------------------------- | Equity June 30, | 27. | 1.0 | -0.9 | 0.4 | 70.9 | 99.0 | 0.5 | 99.5 | | 2007 | 6 | | | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | SEGMENT REPORTING - secondary segment | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | | 1-6 | | 1-6 | | 1-12 | -------------------------------------------------------------------------------- | Million euros | 2007 | | 2006 | | 2006 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | NET SALES | | | | | | -------------------------------------------------------------------------------- | Finland | 28.5 | | 28.9 | | 53.6 | -------------------------------------------------------------------------------- | Other Europe | 40.8 | | 35.1 | | 67.6 | -------------------------------------------------------------------------------- | Other countries | 28.5 | | 19.6 | | 45.7 | -------------------------------------------------------------------------------- | Eliminations | -12.8 | | -4.3 | | -11.9 | -------------------------------------------------------------------------------- | Consolidated | 85.0 | | 79.3 | | 155.0 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | INVESTMENTS | | | | | | -------------------------------------------------------------------------------- | Finland | 7.1 | | 2.3 | | 9.2 | -------------------------------------------------------------------------------- | Other Europe | 0.3 | | 0.3 | | 0.5 | -------------------------------------------------------------------------------- | Other countries | 3.4 | | | | 1.8 | -------------------------------------------------------------------------------- | Consolidated | 10.8 | | 2.6 | | 11.5 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | ASSETS | | | | | | -------------------------------------------------------------------------------- | Finland | 131.1 | | 124.8 | | 126.4 | -------------------------------------------------------------------------------- | Other Europe | 20.6 | | 18.8 | | 19.3 | -------------------------------------------------------------------------------- | Other countries | 20.7 | | 11.5 | | 13.2 | -------------------------------------------------------------------------------- | Eliminations | -7.6 | | -4.0 | | -5.3 | -------------------------------------------------------------------------------- | Consolidated | 164.8 | | 151.1 | | 153.6 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | KEY FIGURES | | | | | | -------------------------------------------------------------------------------- | | 1-6 | | 1-6 | | 1-12 | -------------------------------------------------------------------------------- | | 2007 | | 2006 | | 2006 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Net sales | 85.0 | | 79.3 | | 155.0 | -------------------------------------------------------------------------------- | Operating profit | 11.7 | | 11.7 | | 25.9 | -------------------------------------------------------------------------------- | % of net sales | 13.7 | | 14.8 | | 16.7 | -------------------------------------------------------------------------------- | Profit before tax and minority | 11.7 | | 11.6 | | 26.2 | | interest | | | | | | -------------------------------------------------------------------------------- | Profit for the period | 8.7 | | 8.6 | | 20.1 | -------------------------------------------------------------------------------- | Return on equity, % | 16.8 | | 17.5 | | 19.4 | -------------------------------------------------------------------------------- | Return on net assets, % | 20.4 | | 21.6 | | 23.7 | -------------------------------------------------------------------------------- | Equity to assets ratio, % | 60.7 | | 63.8 | | 70.6 | -------------------------------------------------------------------------------- | Gearing, % | 13.2 | | 3.3 | | -4.3 | -------------------------------------------------------------------------------- | Gross investments | 10.8 | | 2.6 | | 11.5 | -------------------------------------------------------------------------------- | % of net sales | 12.7 | | 3.3 | | 7.4 | -------------------------------------------------------------------------------- | Average personnel number over | 1, 449 | | 1,401 | | 1,415 | | the period | | | | | | -------------------------------------------------------------------------------- | Earnings/share, diluted, euros | 0.31 | | 0.31 | | 0.73 | -------------------------------------------------------------------------------- | Equity/share, diluted, euros | 3.59 | | 3.48 | | 3.90 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | COMMITMENTS AND CONTINGENCIES | | | | | | -------------------------------------------------------------------------------- | Million euros | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Commitments | 0.3 | | 0.4 | | 0.3 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | DERIVATIVE FINANCIAL | | | | | | | INSTRUMENTS | | | | | | -------------------------------------------------------------------------------- | Million euros | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Forward exchanges, not in hedge accounting | | | -------------------------------------------------------------------------------- | Fair value | 3.0 | | 2.4 | | 5.0 | -------------------------------------------------------------------------------- | Value for underlying asset | 2.9 | | 2.4 | | 4.9 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Electricity derivatives | | | | | | -------------------------------------------------------------------------------- | Fair value | 2.0 | | 1.0 | | 2.0 | -------------------------------------------------------------------------------- | Trading value | 1.9 | | 0.6 | | 2.0 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- FURTHER INFORMATION WILL BE GIVEN on August 9, 2007 between 5.15 and 6.00 p.m. Finnish time: Mr. Jyrki Nuutila, President and CEO, tel. +358 400 625 030, and Mr. Seppo Holkko, Executive Vice President, PMC, tel. +358 40 509 3319 Following interim report - January-September, published on October 25, 2007 DISTRIBUTION OMX Nordic Exchange Helsinki Main media www.tamfelt.com