INTERIM FINANCIAL REPORT OF THE LAROX GROUP FOR THE PERIOD 1 JANUARY 2007 TO 30
JUNE 2007
Orders received in the Group grew by 36.6% from the year of comparison. The
amount of new orders received during the first quarter of 2007 totalled EUR 86.0
million (EUR 63.0 million). The amount of new orders during the second quarter
totalled EUR 43.0 million (EUR 38.0 million).
Group order backlog at the end of June 2007 totalled EUR 53.8 million (EUR 37.7
million), which is 42.8% higher than during the same period in the previous
year.
During the first quarter of 2007 net sales totalled EUR 75.3 million (EUR 54.1
million), indicating a growth of 39.2%.
Operating profit totalled EUR 6.0 million (EUR 1.9 million), improved by 215.8%.
The result before tax for the review period totalled EUR 5.5 million (EUR 0.5
million).
Earnings per share was EUR 0.35 (EUR 0.04).
BUSINESS OPERATIONS
Demand for the Larox products has remained good. During the review period the
order accumulation improved positively and the order backlog was 8.9 million
euros higher than at the turn of the fiscal year.
More than 95% of Group net sales were generated by exports and foreign
operations. Net sales by geographical division were as follows:
--------------------------------------------------------------------------------
| | 1-6/2007 | 1-6/2006 |
--------------------------------------------------------------------------------
| North, Central and South | 34.4% | 36.9% |
| America | | |
--------------------------------------------------------------------------------
| Asia and Australasia | 21.7% | 22.0% |
| | | |
--------------------------------------------------------------------------------
| Europe, CIS, Middle East | 43.9% | 41.1% |
| and Africa | | |
--------------------------------------------------------------------------------
CHANGES IN GROUP STRUCTURE
There was no change in Group structure during the review period.
PROFITS AND PROFITABILITY
Larox Group's result before tax for the six months totalled EUR 5.5 million (EUR
0.5 million, 1 January 2006 to 30 June 2006). Net sales totalled EUR 75.3
million (EUR 54.1 million). The Group showed an operating profit of EUR 6.0
million (EUR 1.9 million), i.e. 8.0% (3.5%) of net sales.
Order backlog at the end of the review period totalled EUR 53.8 million (EUR
37.7 million). The amount of new orders received during the review period
totalled EUR 86.0 million (EUR 63.0 million).
NET SALES AND RESULT DEVELOPMENT DURING THE SECOND QUARTER
For the second quarter of the year net sales totalled EUR 42.7 million (EUR 29.0
million) and profit before tax totalled EUR 3.1 million (EUR 1.1 million). The
Group showed an operating profit of EUR 3.3 million (EUR 1.9 million). The
amount of new orders received during the second quarter of the year totalled EUR
43.0 million (EUR 38.0 million). Earnings per share was EUR 0.18 (EUR 0.10).
Operating profit includes a one-time cost of approx. EUR 0.8 million, recorded
in the second quarter caused by the termination of the filter assembly functions
in Larox's wholly owned subsidiary Larox B.V. in Utrecht, The Netherlands by the
end of 2007.
In future, Larox B.V. will buy the filter assembly earlier made in Utrecht from
sub-contractor workshops specialized in manufacturing and assembly. This action
aims at developing the profitability and competitiveness of the filters and
improving the efficiency and flexibility of the Utrecht unit.
This was informed by a stock exchange release on 27 June 2007.
BALANCE SHEET AND FINANCING
By the end of June 2007 the Group balance sheet totalled EUR 92.8 million (EUR
77.9 million). By the turn of the year the balance sheet total was EUR 83.3
million. The main reasons for the increase of balance sheet during the year is
the working capital due to increased net sales.
The Group's net financing costs totalled EUR 0.6 million (EUR 1.4 million). The
equity ratio was 30.9 % (29.4 %) and at the end of the previous financial year
(31 December 2006) it was 33.9 %.
INVESTMENTS
Larox Group's investments totalled EUR 1.3 million (EUR 0.6 million).
PERSONNEL
The average number of personnel employed by the Group during the review period
was 448 (446). At the end of the review period it was 475 (465) of whom 230
(225) worked for the parent company.
SHARES AND SHAREHOLDERS
During 1 January 2007 to 30 June 2007 trading in shares totaled 1,747,784, which
is 18.63 % of the total number of shares. The value of shares traded was EUR
19.0 million. During the review period the lowest share price was EUR 8.04 and
the highest was EUR 15.32. The closing price of the share was 14.25 and the
total market value of the shares was EUR 133.7 million. At the end of June there
were 1,190 shareholders.
The Board of Directors of Larox Corporation decided on 30 May 2007 on a new
share-based incentive plan for the Larox Group key personnel. The incentive plan
does not include Board members.
The plan includes one four-year earning period which began on 1 January 2007 and
will end on 31 December 2010. The prerequisite for participation in the plan and
receipt of the reward is that a key person owns Larox Corporation B-shares to
the amount decided by the Board of Directors in advance.
Reward will be paid on the basis of the plan partly as the Company's B-shares
and partly in cash in 2009, 2010 and 2011. The proportion to be paid in cash
will cover taxes and tax-related costs arising from the reward. It is prohibited
to transfer the shares within two years from the reward payment (restriction
period). If a key person's employment or service ends during the restriction
period, he/she must gratuitously return the shares paid as reward to the
Company. As to the members of the Management Team, the owning obligation
concerning the shares received on the basis of the plan will continue as long as
their employment or service in the Group continues, in the manner decided by the
Board of Directors.
The potential reward from the plan will be based on the Group's key figure
Earnings per Share (EPS).
The plan is directed to 30 - 40 people.
The rewards to be paid on the basis of the plan will correspond to a maximum
total of approximately 300,000 Larox Corporation B-shares.
AUTHORIZATIONS TO THE BOARD OF DIRECTOS DECIDED IN THE ANNUAL GENERAL MEETING OF
SHAREHOLDERS
Authorization to decide on repurchase of shares
The Board of Directors may decide on repurchase of shares by using the company's
unrestricted shareholders' equity. The maximum number of shares in the
authorization is 500.000 Larox Corporation B-series shares.
The shares may be purchased in order to finance or carry out acquisitions
or
other business transactions, in order to develop the company's capital
structure, to improve the liquidity of the Company's shares, to employee
incentive plans, to be disposed for other purposes, or to be cancelled.
The repurchases will be carried out through public trading, whereby the shares
will be repurchased in another proportion than according to the holdings of the
shareholders. The repurchase price must be based on the market price of the
Larox Corporation B share in public trading. The repurchases of shares will be
carried out at Helsinki Stock Exchange and according to their rules and
instructions.
The Board of Directors cannot realize the authorization of the repurchase of
shares should the total number of the company's or its subsidiary's own or
pledged shares exceed 10 per cent of all shares after the purchase.
The authorization is valid for 18 months from the resolution by the annual
general meeting of shareholders.
Authorization to decide on share issue, and/or stock option rights or other
special rights that entitle to shares
The Board of Directors may decide on shares, stock option rights or special
rights referred to in the Finnish Companies Act chapter 10, paragraph 1 in one
or more lots in such a way that based on the authorization the total maximum
number of Larox Corporation B-series shares is 500 000. The Board of Directors
may decide to give either new shares or own shares the company possesses. The
authorization can be used to finance and to carry out acquisitions or other
business transactions and the company's investments, employee incentive plans or
other purposes decided by the Board of Directors.
The authorization includes the right to decide on share issue without a
subscription price and the right to deviate from the shareholders' subscription
right according to certain preconditions of the Finnish Companies Act.
The authorization is valid for five years from the resolution by the annual
general meeting of shareholders.
RISKS AND UNCERTAINTY FACTORS
Investments in customers' fields of business affect Larox's business. The most
remarkable risks that may affect the Group's business and financial result are
caused by overall development of economic trends, which is reflected in the
financial situation and demand in the customers' fields of operation. The
development of demand is followed based on general economic situation, e.g by
utilizing test filtrations, order backlog and three (3) and six (6) months'
sales forecasts.
There are a lot of competitors in the business. In addition to international
companies a great number of smaller local companies compete with Larox.
The Group's dependency on one single customer is limited.
The Group has paid special attention to risks related to the availability of
materials and subcontracting and their cost increases.
The risks related to stability and availability of the Group personnel have been
acknowledged and the Group has taken measures to retain the management and other
personnel in the Group and to facilitate recruiting of new personnel.
Different financial instruments are used to manage financial risks. The purpose
is to protect the Group against changes that are unfavourable to the Group's
financial situation. The objective of the Group is to minimize the impacts of
fluctuations in financial markets on the Group's cash reserves, profits and
shareholders' equity. The main risks are currency risks and interest rate
risks. The Group treasury function manages financial risks centrally according
to the currency policy approved by the board of directors.
Larox has insurance coverage on material damages and legal liability for
damages. Insurance coverage on unexpected risks is however limited.
No significant changes have taken place in Larox's risks and uncertainty factors
during the review period.
IMPORTANT EVENTS AFTER THE REVIEW PERIOD
In July Larox and Talvivaara Project Ltd have agreed filter deliveries to the
Talvivaara mine to be built in Sotkamo, Finland. Total value of this so far
biggest single contract for Larox is approximately 10 million euros and includes
several units of Pannevis Horizontal Vacuum Belt Filters with auxiliaries.
Delivery will be in two phases during the years 2008 and 2009.
OUTLOOK FOR THE REST OF THE YEAR
The market situation is expected to continue favorable and the Group net sales
and profitability are expected to improve from the previous year. The good order
backlog at the end of the review period, EUR 53.8 million and the already
started procedures support this. Accumulation of net sales by quarters is more
balanced than in the previous year.
The orders of approximately EUR 86.0 million, received during the first two
quarters of 2007 are a proof of strong investment activity in filters. Positive
demand for metals, which is expected to continue strong and the recovering
demand in the chemical process industry influence specially investment
decisions.
Publication dates of financial information in 2007
The interim report for January-September will be published on Friday 27 October.
The financial year-end of the Larox Group is on 31 December 2007.
Lappeenranta on 10 August 2007
Larox Corporation
Board of Directors
For further information please contact
Mr Toivo Matti Karppanen
President & CEO
Tel +358 (5) 668 8210
Fax +358 (5) 668 8277
E-mail topi.karppanen@larox.com
Internet www.larox.com
Distribution: OMX Nordic Exchange Helsinki, central media
www.larox.com
NOTES TO THE INTERIM REPORT
The review is prepared in accordance with all the requirements of IAS 34 Interim
Financial Reporting -standard and in accordance with IFRS recognition and
measurement principles.
Larox has applied the same accounting principles in this Interim Report as in
Annual Report 2006. The contents of the changes in standards and interpretations
are presented more detailed in Annual Report 2006. In 2007 the Group will start
to apply a new standard IFRS 7 (Financial instruments: Disclosures), published
by IASB in 2005. The adoption will not cause such changes to accounting
principles, that the published comparative information should be changed
regressively.
The preparation of the financial statements in accordance with IFRS requires the
use of estimates and assumptions that affect the reported amounts of assets and
liabilities and the reported amounts of income and expenses during the reporting
period. The estimates are based on management's best knowledge of current events
and actions but actual results may differ from these estimates.
The information in Interim Report is unaudited.
--------------------------------------------------------------------------------
| INCOME STATEMENTS, IFRS | 4-6/200 | 4-6/200 | 1-6/2007 | 1-6/2006 | 1-12/200 |
| | 7 | 6 | | | 6 |
--------------------------------------------------------------------------------
| EUR 1000 | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Sales | 42 651 | 29 001 | 75 310 | 54 097 | 122 809 |
--------------------------------------------------------------------------------
| Other operating income | 281 | 656 | 509 | 943 | 1 680 |
--------------------------------------------------------------------------------
| Change in inventories of finished | | | | |
--------------------------------------------------------------------------------
| goods and work in | -1 151 | 1 792 | -427 | -81 | -1 287 |
| progress | | | | | |
--------------------------------------------------------------------------------
| Materials and services | -22 544 | -16 051 | -39 583 | -26 360 | -59 743 |
--------------------------------------------------------------------------------
| Personnel expenses | -8 084 | -6 807 | -14 888 | -13 337 | -28 092 |
--------------------------------------------------------------------------------
| Depreciation, | -825 | -850 | -1 684 | -1 735 | -3 412 |
| amortisation & | | | | | |
| impairment losses | | | | | |
--------------------------------------------------------------------------------
| Other operating | -7 051 | -5 887 | -13 216 | -11 623 | -23 023 |
| expenses | | | | | |
--------------------------------------------------------------------------------
| OPERATING PROFIT | 3 276 | 1 853 | 6 020 | 1 905 | 8 931 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Financial income | 141 | 406 | 277 | 623 | 890 |
--------------------------------------------------------------------------------
| Financial expenses | -391 | -1 166 | -934 | -2 070 | -3 032 |
--------------------------------------------------------------------------------
| Share of profit/loss in | 125 | 37 | 106 | 37 | 255 |
| associates | | | | | |
--------------------------------------------------------------------------------
| PROFIT BEFORE TAX | 3 151 | 1 129 | 5 468 | 495 | 7 044 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Income tax expense | -1 434 | -230 | -2 202 | -142 | -2 040 |
--------------------------------------------------------------------------------
| PROFIT FOR THE PERIOD | 1 716 | 899 | 3 267 | 353 | 5 004 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| EPS basic&diluted (EUR) | 0,18 | 0,10 | 0,35 | 0,04 | 0,53 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| BALANCE SHEETS, IFRS | | | |
--------------------------------------------------------------------------------
| EUR 1000 | 30.6.2007 | 30.6.2006 | 31.12.2006 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| ASSETS | | | |
--------------------------------------------------------------------------------
| Intangible assets | 18 769 | 18 458 | 18 871 |
--------------------------------------------------------------------------------
| Goodwill | 2 968 | 2 929 | 2 948 |
--------------------------------------------------------------------------------
| Property, plant and equipment | 9 336 | 10 078 | 9 566 |
--------------------------------------------------------------------------------
| Investments in associates | 1 143 | 940 | 1 153 |
--------------------------------------------------------------------------------
| Other long-term investments | 208 | 273 | 208 |
--------------------------------------------------------------------------------
| Deferred tax asset | 3 086 | 2 825 | 3 561 |
--------------------------------------------------------------------------------
| NON-CURRENT ASSETS | 35 511 | 35 503 | 36 307 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Inventories | 22 527 | 17 903 | 19 842 |
--------------------------------------------------------------------------------
| Trade and other receivables | 30 720 | 22 592 | 25 194 |
--------------------------------------------------------------------------------
| Cash and cash equivalents | 4 009 | 1 891 | 1 952 |
--------------------------------------------------------------------------------
| CURRENT ASSETS | 57 257 | 42 387 | 46 988 |
--------------------------------------------------------------------------------
| TOTAL ASSETS | 92 768 | 77 890 | 83 295 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| EQUITY AND LIABILITIES | | | |
--------------------------------------------------------------------------------
| Share capital | 5 629 | 5 629 | 5 629 |
--------------------------------------------------------------------------------
| Share premium account | 5 777 | 5 777 | 5 777 |
--------------------------------------------------------------------------------
| Other reserves | 27 | 183 | 61 |
--------------------------------------------------------------------------------
| Translation differences | -133 | -59 | -69 |
--------------------------------------------------------------------------------
| Retained earnings | 15 535 | 10 934 | 15 271 |
--------------------------------------------------------------------------------
| SHAREHOLDERS' EQUITY | 26 835 | 22 464 | 26 668 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Deferred tax liability | 2 125 | 1 094 | 2 511 |
--------------------------------------------------------------------------------
| Long-term liabilities, interest-bearing | 14 820 | 23 471 | 19 405 |
--------------------------------------------------------------------------------
| Employee benefit obligations | 416 | 383 | 398 |
--------------------------------------------------------------------------------
| Non-current provisions | 2 012 | 1 546 | 1 422 |
--------------------------------------------------------------------------------
| NON-CURRENT LIABILITIES | 19 373 | 26 493 | 23 735 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Short-term liabilities, | 20 238 | 12 617 | 9 619 |
| interest-bearing | | | |
--------------------------------------------------------------------------------
| Short-term liabilities, non | 25 338 | 16 305 | 22 608 |
| interest-bearing | | | |
--------------------------------------------------------------------------------
| Tax liability, income tax | 984 | 0 | 665 |
--------------------------------------------------------------------------------
| Current provisions | 0 | 10 | 0 |
--------------------------------------------------------------------------------
| CURRENT LIABILITIES | 46 560 | 28 932 | 32 892 |
--------------------------------------------------------------------------------
| TOTAL EQUITY AND LIABILITIES | 92 768 | 77 890 | 83 295 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| CASH FLOW STATEMENTS, IFRS | | | |
--------------------------------------------------------------------------------
| 1000 EUR | 1-6/2007 | 1-6/2006 | 1-12/2006 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Net profit/loss | 3 267 | 353 | 5 004 |
--------------------------------------------------------------------------------
| Adjustments to the net profit/loss of | 4 420 | 2 181 | 7 132 |
| the period | | | |
--------------------------------------------------------------------------------
| Change in working capital | -5 357 | 6 191 | 6 020 |
--------------------------------------------------------------------------------
| Interest paid | -854 | -1 071 | -1 814 |
--------------------------------------------------------------------------------
| Interest income received | 32 | 49 | 79 |
--------------------------------------------------------------------------------
| Other financing items | 73 | -18 | -310 |
--------------------------------------------------------------------------------
| Income taxes paid | -1 498 | -762 | -1 229 |
--------------------------------------------------------------------------------
| Net cash from operating activities | 82 | 6 923 | 14 881 |
--------------------------------------------------------------------------------
| Net cash used in investment activities | -1 216 | -477 | -1 672 |
--------------------------------------------------------------------------------
| Share issue | 0 | 0 | 0 |
--------------------------------------------------------------------------------
| Increase in loans | 13 521 | 6 299 | 5 896 |
--------------------------------------------------------------------------------
| Decrease in loans | -7 506 | -10 206 | -16 494 |
--------------------------------------------------------------------------------
| Repayment of finance lease liabilities | -21 | -57 | -56 |
--------------------------------------------------------------------------------
| Dividends paid | -2 814 | -2 226 | -2 226 |
--------------------------------------------------------------------------------
| Net cash used in financing activities | 3 179 | -6 190 | -12 880 |
--------------------------------------------------------------------------------
| Change in cash and cash equivalents | 2 045 | 256 | 329 |
--------------------------------------------------------------------------------
| Operating balance of cash and cash | 1 952 | 1 737 | 1 737 |
| equivalents | | | |
--------------------------------------------------------------------------------
| Effect of the foreign exchange rates | 12 | -102 | -114 |
--------------------------------------------------------------------------------
| Closing balance of cash and cash | 4 009 | 1 891 | 1 952 |
| equivalents | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| CHANGE IN SHAREHOLDERS' EQUITY | | | | | |
| 1-6/2006 | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | | Share | Fair | Hed | Other | Trans- | |
| | | | | - | | | |
--------------------------------------------------------------------------------
| 1000 EUR | Share | issue | valu | gin | res- | latio | Retained |
| | | | e | g | | n | |
--------------------------------------------------------------------------------
| | capit | premi | res. | res | erves | diff. | earnin | Total |
| | al | um | | . | | | gs | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| SHAREHOLDERS' | 5 629 | 5 777 | 138 | -15 | | -145 | 13 516 | 24 901 |
| EQUITY | | | | | | | | |
--------------------------------------------------------------------------------
| 1 JANUARY | | | | | | | | |
| 2006 | | | | | | | | |
--------------------------------------------------------------------------------
| Cash flow | | | | | | | | |
| hedging | | | | | | | | |
--------------------------------------------------------------------------------
| Transferred to profit or loss for | 59 | | | | 59 |
| the period | | | | | |
--------------------------------------------------------------------------------
| Change in translation | | | | 86 | -737 | -651 |
| difference | | | | | | |
--------------------------------------------------------------------------------
| Net profits and losses recognized directly in | | | |
--------------------------------------------------------------------------------
| shareholders | | | | 59 | | 86 | -737 | -592 |
| equity | | | | | | | | |
--------------------------------------------------------------------------------
| Profit for | | | | | | | 353 | 353 |
| the period | | | | | | | | |
--------------------------------------------------------------------------------
| Total profits and | | | 59 | | 86 | -384 | -239 |
| losses | | | | | | | |
--------------------------------------------------------------------------------
| Dividend | | | | | | | -2 226 | -2 226 |
| distribution | | | | | | | | |
--------------------------------------------------------------------------------
| Share-based | | | | | | | 28 | 28 |
| payments | | | | | | | | |
--------------------------------------------------------------------------------
| SHAREHOLDERS' | | | | | | | | |
| EQUITY | | | | | | | | |
--------------------------------------------------------------------------------
| 30 JUNE 2006 | 5 629 | 5 777 | 138 | 44 | 0 | -59 | 10 934 | 22 464 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| CHANGE IN SHAREHOLDERS' EQUITY | | | | | |
| 1-6/2007 | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | | Share | Fair | Hed | Other | Trans- | |
| | | | | - | | | |
--------------------------------------------------------------------------------
| 1000 EUR | Share | issue | valu | gin | res- | latio | Retained |
| | | | e | g | | n | |
--------------------------------------------------------------------------------
| | capit | premi | res. | res | erves | diff. | earnin | Total |
| | al | um | | . | | | gs | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| SHAREHOLDERS' | 5 629 | 5 777 | 105 | -44 | 0 | -69 | 15 271 | 26 668 |
| EQUITY | | | | | | | | |
--------------------------------------------------------------------------------
| 1 JANUARY | | | | | | | | |
| 2007 | | | | | | | | |
--------------------------------------------------------------------------------
| Cash flow | | | | | | | | |
| hedging | | | | | | | | |
--------------------------------------------------------------------------------
| Transferred to profit or loss for | -39 | | | | -39 |
| the period | | | | | |
--------------------------------------------------------------------------------
| Change in translation | | | -1 | -64 | -206 | -271 |
| difference | | | | | | |
--------------------------------------------------------------------------------
| Net profits and losses recognized directly in | | | |
--------------------------------------------------------------------------------
| shareholders | | | | -39 | -1 | -64 | -206 | -310 |
| equity | | | | | | | | |
--------------------------------------------------------------------------------
| Other changes | | | | | 6 | | | 6 |
--------------------------------------------------------------------------------
| Profit for | | | | | | | 3 267 | 3 267 |
| the period | | | | | | | | |
--------------------------------------------------------------------------------
| Total profits and | | | -39 | 5 | -64 | 3 060 | 2 963 |
| losses | | | | | | | |
--------------------------------------------------------------------------------
| Dividend | | | | | | | -2 814 | -2 814 |
| distribution | | | | | | | | |
--------------------------------------------------------------------------------
| Share-based | | | | | | | 19 | 19 |
| payments | | | | | | | | |
--------------------------------------------------------------------------------
| SHAREHOLDERS' | | | | | | | | |
| EQUITY | | | | | | | | |
--------------------------------------------------------------------------------
| 30 JUNE 2007 | 5 629 | 5 777 | 105 | -84 | 5 | -133 | 15 535 | 26 835 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| KEY RATIOS OF LAROX GROUP | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| EUR 1000 | 1-6/2007 | 1-6/2006 | 1-12/2006 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| New orders | 86 038 | 62 964 | 137 971 |
--------------------------------------------------------------------------------
| Group order backlog at end of period | 53 845 | 37 706 | 44 911 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Net sales | 75 310 | 54 097 | 122 809 |
--------------------------------------------------------------------------------
| Operating profit | 6 020 | 1 905 | 8 931 |
--------------------------------------------------------------------------------
| % of net sales | 8.0 | 3.5 | 7.3 |
--------------------------------------------------------------------------------
| Net financing costs | 552 | 1 410 | 1 887 |
--------------------------------------------------------------------------------
| % of net sales | 0.7 | 2.6 | 1.5 |
--------------------------------------------------------------------------------
| Result before taxes | 5 468 | 495 | 7 044 |
--------------------------------------------------------------------------------
| Result for the period | 3 267 | 353 | 5 004 |
--------------------------------------------------------------------------------
| EPS basic and diluted (EUR) | 0.35 | 0.04 | 0.53 |
--------------------------------------------------------------------------------
| Investments | 1 334 | 607 | 2 285 |
--------------------------------------------------------------------------------
| Shareholders' equity per share at end | 2.86 | 2.39 | 2.84 |
| of period, EUR | | | |
--------------------------------------------------------------------------------
| Equity Ratio % | 30.9 | 29.4 | 33.9 |
--------------------------------------------------------------------------------
| Contingent liabilities | 27.8 | 27.9 | 27.8 |
--------------------------------------------------------------------------------
| Trading price at end of period, EUR | 14.25 | 7.9 | 9.00 |
--------------------------------------------------------------------------------
| Market capitalization at end of period, | | |
--------------------------------------------------------------------------------
| EUR million *) | 133.7 | 74.1 | 84.4 |
--------------------------------------------------------------------------------
*) The price of the A share is based on the B share's last trading rate of the
reporting period (weighted average).
--------------------------------------------------------------------------------
| KEY FIGURES BY | | | | | |
| QUARTERS | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | 2007 | 2007 | 2006 | 2006 | 2006 |
--------------------------------------------------------------------------------
| EUR 1000 | 4-6 | 1-3 | 10-12 | 7-9 | 4-6 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| New orders | 42 979 | 43 059 | 43 482 | 31 525 | 38 041 |
--------------------------------------------------------------------------------
| Group order backlog | 53 845 | 55 201 | 44 911 | 41 780 | 37 706 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Net sales | 42 651 | 32 659 | 40 431 | 28 281 | 29 001 |
--------------------------------------------------------------------------------
| Operating profit | 3 276 | 2 743 | 4 568 | 2 457 | 1 853 |
--------------------------------------------------------------------------------
| % of net sales | 7.7 | 8.4 | 11.3 | 8.7 | 6.4 |
--------------------------------------------------------------------------------
| Net financing costs | 126 | 426 | 218 | 259 | 724 |
--------------------------------------------------------------------------------
| % of net sales | 0.3 | 1.3 | 0.5 | 0.9 | 2.5 |
--------------------------------------------------------------------------------
| Result before taxes | 3 150 | 2 318 | 4 350 | 2 198 | 1 129 |
--------------------------------------------------------------------------------
| Result for the | *) 1 716 | 1 550 | **) 3 358 | 1 293 | 899 |
| quarter | | | | | |
--------------------------------------------------------------------------------
| EPS basic and diluted | 0.18 | 0.17 | 0.36 | 0.14 | 0.10 |
| (EUR) | | | | | |
--------------------------------------------------------------------------------
*) includes one-time cost of EUR 0.8 million for terminating filter assembly
functions in The Netherlands
**) includes one-time cost of EUR 0.9 million for terminating component
manufacturing functions in The Netherlands.
DIVIDENDS PAID
Based on the resolution of the annual general meeting of shaholders held on 30
March 2007 a dividend of EUR 0.30 per share was paid; a total of EUR 2.814.480.
The dividends were paid on 13 April 2007.
Investments
--------------------------------------------------------------------------------
| Property, plant and equipment | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | | 30.6.2007 | 30.6.2006 | 31.12.2006 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Acquisition cost 1 Jan | | 28 589 | 28 222 | 28 222 |
--------------------------------------------------------------------------------
| Translation differences | | 6 | -74 | -139 |
--------------------------------------------------------------------------------
| Additions | | 459 | 375 | 770 |
--------------------------------------------------------------------------------
| Disposals | | 0 | -86 | -265 |
--------------------------------------------------------------------------------
| Acquisition cost 30 Jun | | 29 054 | 28 437 | 28 589 |
--------------------------------------------------------------------------------
| Cumulative depreciations 1 Jan | -19 023 | -17 599 | -17 599 |
--------------------------------------------------------------------------------
| Translation differences | | 16 | -7 | 60 |
--------------------------------------------------------------------------------
| Depreciation for the period | -711 | -753 | -1 484 |
--------------------------------------------------------------------------------
| Cumulative depreciations 30 | | -19 718 | -18 359 | -19 023 |
| Jun | | | | |
--------------------------------------------------------------------------------
| Carrying value 30 Jun, 2007 | 9 336 | 10 078 | 9 566 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Intangible assets (exluding goodwill) | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | | 30.6.2007 | 30.6.2006 | 31.12.2006 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Acquisition cost 1 Jan | | 27 772 | 26 311 | 26 311 |
--------------------------------------------------------------------------------
| Translation differences | | -11 | -156 | -86 |
--------------------------------------------------------------------------------
| Additions | | 874 | 227 | 1 547 |
--------------------------------------------------------------------------------
| Disposals | | 0 | 0 | 0 |
--------------------------------------------------------------------------------
| Acquisition cost 30 Jun | | 28 635 | 26 382 | 27 772 |
--------------------------------------------------------------------------------
| Cumulative depreciations 1 Jan | -8 900 | -6 975 | -6 975 |
--------------------------------------------------------------------------------
| Translation differences | | 7 | 33 | 3 |
--------------------------------------------------------------------------------
| Depreciation for the period | -973 | -982 | -1 928 |
--------------------------------------------------------------------------------
| Cumulative depreciations 30 | | -9 866 | -7 924 | -8 900 |
| Jun | | | | |
--------------------------------------------------------------------------------
| Carrying value 30 Jun, 2007 | 18 769 | 18 458 | 18 872 |
--------------------------------------------------------------------------------
Investments with commitment
--------------------------------------------------------------------------------
| 1000 EUR | | | 2007 | | 2008 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| ERP system | | 250 | | 220 |
--------------------------------------------------------------------------------
Geographical segments
--------------------------------------------------------------------------------
| Net sales 1000 EUR | 1-6/2007 | 1-6/2006 | 1-12/2006 |
--------------------------------------------------------------------------------
| North, Central and South America | 25 929 | 20 030 | 44 556 |
--------------------------------------------------------------------------------
| Asia and Australasia | 16 324 | 11 947 | 29 028 |
--------------------------------------------------------------------------------
| Europe, CIS, Middle East and Africa | 33 056 | 22 120 | 49 225 |
--------------------------------------------------------------------------------
| Total net sales | 75 310 | 54 097 | 122 809 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Assets 1000 EUR | 1-6/2007 | 1-6/2006 | 1-12/2006 |
--------------------------------------------------------------------------------
| North, Central and South America | 9 082 | 10 429 | 12 620 |
--------------------------------------------------------------------------------
| Asia and Australasia | 10 022 | 4 201 | 5 864 |
--------------------------------------------------------------------------------
| Europe, CIS, Middle East and Africa | 84 811 | 66 920 | 90 571 |
--------------------------------------------------------------------------------
| Internal items | -12 061 | -3 659 | -25 760 |
--------------------------------------------------------------------------------
| Total assets | 92 768 | 77 890 | 83 295 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Investments 1000 EUR | 1-6/2007 | 1-6/2006 | 1-12/2006 |
--------------------------------------------------------------------------------
| North, Central and South America | 43 | 227 | 267 |
--------------------------------------------------------------------------------
| Asia and Australasia | 171 | 36 | 167 |
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| Europe, CIS, Middle East and Africa | 1 119 | 344 | 1 851 |
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| Total investments | 1 334 | 607 | 2 285 |
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Commitments and contingencies
--------------------------------------------------------------------------------
| Loans secured by real estate and corporate mortgages | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 1000 EUR | 30.6.2007 | 30.6.2006 | 31.12.2006 |
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| Pension loans | | | |
--------------------------------------------------------------------------------
| Loans from financial institutions | 30 161 | 26 838 | 24 464 |
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| Other loans | 1 420 | 5 356 | 4 338 |
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| Total | 31 581 | 32 194 | 28 802 |
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--------------------------------------------------------------------------------
| Real estate mortgages | 6 560 | 6 560 | 6 560 |
| | | | |
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| Corporate mortgages, general | 3 936 | 3 936 | 3 936 |
| pledging | | | |
--------------------------------------------------------------------------------
| Corporate mortgages, specific | 9 062 | 9 062 | 9 062 |
| pledging | | | |
--------------------------------------------------------------------------------
| Total | 19 558 | 19 558 | 19 558 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Guarantees for others | | | |
--------------------------------------------------------------------------------
| Pledged securities * | 6 476 | 6 476 | 6 476 |
--------------------------------------------------------------------------------
| Others | 166 | 176 | 146 |
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| Total | 6 642 | 6 652 | 6 622 |
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| *) Book value of secured shares | | | |
--------------------------------------------------------------------------------
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| Other liabilities | | | |
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| Operating lease liabilities 1000 EUR | 920 | 1 027 | 979 |
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| Lease liabilities 1000 EUR | 634 | 638 | 629 |
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Fair and nominal values of derivative instruments
--------------------------------------------------------------------------------
| 1000 EUR | 30.6.2007 | 30.6.2006 | 31.12.2006 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Currency derivatives: | | | |
--------------------------------------------------------------------------------
| Forward contracts | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Fair value | -103 | 285 | -13 |
--------------------------------------------------------------------------------
| Nominal value | 16 060 | 13 100 | 12 870 |
--------------------------------------------------------------------------------
Related party transactions
--------------------------------------------------------------------------------
| 1000 EUR | 1-6/2007 | 1-6/2006 | 1-12/2006 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Transactions with associated | | | |
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| Companies | | | |
--------------------------------------------------------------------------------
| Sales of goods and services | 1 | | 2 |
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| Purchases of goods and services | 1 046 | 1 111 | 2 135 |
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| Other transactions with related | | |
--------------------------------------------------------------------------------
| Parties | | | |
--------------------------------------------------------------------------------
| Purchases of services | 11 | 11 | 22 |
--------------------------------------------------------------------------------
| Balances with associated companies | | |
--------------------------------------------------------------------------------
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| Trade receivables | 1 | | 1 |
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| Trade payables | 355 | 363 | 219 |
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CALCULATION OF KEY FIGURES
Equity ratio, % =
Shareholders' equity
--------------------------------- x 100
Total assets - advances received
Earnings per share =
Net profit
---------------------------------
Adjusted average number of shares
during the period
Market capitalization at the end of the period
Number of shares at the end of the period x trading price at the end of period
weighted by the number of shares traded
Larox develops, designs and manufactures industrial filters and is a leading
technology company in its field. Larox is a full service solution provider in
filtration for separating solids from liquids. It supplies comprehensive
aftermarket services throughout the lifespan of the Larox solution. Companies
world-wide in mining and metallurgy, chemical processing and related industries
benefit from the Larox technologies. Larox operates in over 40 countries and has
over 440 employees. Larox Group is headquartered in Lappeenranta, Finland.
Product factories are located in Lappeenranta and Utrecht, The Netherlands. Net
sales in 2006 totalled 122.8 million euros, of which more than 95 % were
generated by exports and the company's foreign operations.
INTERIM FINANCIAL REPORT OF THE LAROX GROUP FOR THE PERIOD 1 JANUARY 2007 TO 30 JUNE 2007
| Source: Larox Oyj