Vaisala Oyj Stock exchange release 31.10.2007 at 11.00 1(11)
- Net sales: EUR 152.2 (144.9) million, growth 5.1%.
- Operating profit: EUR 19.6 (19.1) million, growth 3.0%.
- Orders received: EUR 174.8 (178.5) million, decrease 2.1%.
- Order book: EUR 99.0 (87.7) million.
- Profit before extraordinary items, provisions and taxes: EUR 21.0
(18.8) million, growth 11.6%.
- Net profit for the review period: EUR 14.8 (13.3) million, growth
11.6%.
- Earnings per share: EUR 0.81 (0.73), growth 11.3%.
3rd quarter 2007
- Net sales: EUR 51.5 (52.4) million, decrease 1.8%
- Operating profit: EUR 4.5 (8.7) million, decrease 48.1%
- Orders received: EUR 66.9 (52.6) million, growth 27.2%
- Profit before extraordinary items, provisions and taxes: EUR 4.6
(9.2) million, decrease 50.2%
- Net profit for the 3rd quarter: EUR 3.0 (6.8) million, decrease
55.5%
- Earnings per share: EUR 0.17 (0.37) million, decrease 55.5%
Comments on the third quarter
The net sales of the third quarter remain on the same level as in the
previous year. The result was burdened by the costs resulting from
measures to push growth and improve efficiency. The development of
the number of orders received was positive.
Outlook for the rest of the year
Market development is expected to remain stable in 2007. Adjusting
our earlier estimations, we expect the net sales to be slightly
higher than in 2006. Operating profit is expected to remain on the
same level as in 2006, due to ongoing development projects. Due to
seasonal variation typical to Vaisala's business, the result of the
fourth quarter has a significant effect on the net sales and result
for the whole year.
Vaisala aims to be the global market leader in its selected business
areas also in the future. Therefore investments in product
development and competitiveness will continue to be substantial.
CEO Kjell Forsén's comments on the January - September result:"The number of orders received grew significantly in the 3rd quarter
compared to the corresponding period last year, and the moving
12-month trend shows growth. Net sales grew particularly well in the
Asia and Pacific, 16%, whereas the weakening dollar caused a decrease
in sales in euros in North America.
Vaisala is pushing for growth, which burdens the result of the second
half year. According to the new growth strategy, Vaisala is expanding
its business from measurement instruments and systems to service and
solutions business. We are developing our sales organization,
improving our market coverage and developing new products for service
and solutions businesses. Investments in support of the new strategy
will continue in order to create growth."
Market situation, net sales and order book
Judging from the positive development in the order flow during the
3rd quarter, the market situation in all markets is promising. The
sustained maintenance and development of competitiveness has enabled
Vaisala to retain its strong market share. Net sales grew in Europe
(10.6%) as well as in Asia and Pacific (16.0). Net sales decreased in
Africa, South and Central America (-9.8%), as well as in North
America (-5.2%). Exchange rates decreased the result of the North
American segment, whose net sales grew by 2.8% at comparable exchange
rates.
Orders received decreased by 2.1% compared to the corresponding
period in 2006, being EUR 174.8 (178.5) million. The total of orders
received in the past 12 months is EUR 240 million. At the end of the
review period, the order book stood at EUR 99.0 (87.7) million. Some
EUR 45 million of the order book will be delivered in 2008 or later.
Vaisala Group's net sales for the review period grew by 5.1%, being
EUR 152.2 (144.9) million. Vaisala Instruments division's net sales
grew by 6.9% and Vaisala Solutions division's by 8.8%. Vaisala
Measurement Systems division's net sales decreased by 0.9%.
Operations outside Finland accounted for 96% of net sales as before.
Performance and balance sheet
Operating profit for the review period was 12.9% of net sales, EUR
19.6 (19.1) million. The structure of financial reporting was changed
starting from 2007. Instead of being reported under other operating
income and expenses, the result of hedging activities is reported
below operating profit in financial income and expenses, where
foreign exchange gains and losses are also reported. The figures of
the review period as well as those of the accounting period 2006 have
been changed to correspond to the current reporting structure.
Profit before tax was 13.8% of net sales, EUR 21.0 (18.8) million,
growth 11.6%. Net profit for the review period was EUR 14.8 (13.3)
million, growth 11.6%.
The Vaisala Group's solvency and liquidity remained strong. On
September 30, 2007 the balance sheet total was EUR 212.3 (197.1)
million. The Group's solvency ratio at the end of the review period
was 83% (84%).
The total of the Group's liquid assets was EUR 95.0 (72.1) million.
Research and development
Expenditure on research and development in the review period totaled
EUR 16.8 (14.7) million, being 11.1% of the Group's net sales.
Capital expenditure
Gross capital expenditure totaled EUR 5.0 million (18.6).
Vaisala Measurement Systems
Vaisala Measurement Systems division generated net sales of EUR 59.0
(59.5) million, decrease 0.9%. Operating profit for the review period
grew to EUR 9.5 (8.5) million.
Orders received by Vaisala Measurement Systems decreased by 12%,
being EUR 69.3 (79.1/1-9/2006; 61.0/1-9/2005) million.
Vaisala received its first weather radar orders during the review
period. The orders include a total of five dual-polarization radars,
which carry Sigmet signal processors and application software. The
orders came from the Estonian Meteorological and Hydrological
Institute, and a long-standing Vaisala customer. When fully realized,
the total value of the radar orders is approximately EUR 4 million.
Deliveries will be carried out between November 2007 and June 2008.
Vaisala has won a contract with the Meteorological Service Canada
(PWGSC) for the modernization of Canada's synoptic upper-air
observation network. The contract term is ten years, and estimated
value 27 million USD. The deliveries started in October 2007.
Vaisala Instruments
Net sales of the Vaisala Instruments division grew by 9.5%, being EUR
51.7 (47.2) million. Operating profit for the review period grew to
EUR 14.9 (14.5) million.
The number of orders received by the Vaisala Instruments division
grew compared to the previous year, being EUR 51.1 (50.8/1-9/2006;
45.2/1-9/2005) million.
Competition in all product categories for industrial measurements
remains fierce. Vaisala's global operating model, combined with
significant investments in research and development, form the basis
to retain market leadership and increase market share.
Vaisala Solutions
Net sales of the Vaisala Solutions division grew by 8.9%, being EUR
41.6 (38.2) million. Operating profit for the review period was EUR
-1.1 (-0.5) million. Due to the characteristics of the division's
business, operating profits normally turn positive on the fourth
quarter.
The number of orders received by the Vaisala Solutions division
increased by 12%, being EUR 54.4 (48.6/1-9/2006; 41.7/1-9/2005)
million.
Vaisala has signed a contract with a long-standing customer for fixed
base automatic weather stations for aviation operations use. The
contract covers the supply of automatic weather stations and support
services, and can be extended to the end of the year 2012. The
estimated value of the contract is over 10 million USD.
Events during the review period
Vaisala responds to the growing demand for services and solutions by
streamlining its operations and simplifying its organization. All
current service operations will be centralized under a new Vaisala
Services division. Vaisala Solutions division will focus more clearly
on comprehensive solutions. Vaisala assembly, production, procurement
and deliveries will be centralized under a new Operations unit.
Reporting based on the new segments will become effective on
1.1.2008, including Vaisala measurement Systems, Vaisala Instruments,
Vaisala Solutions and Vaisala Services.
Personnel
The average number of employees in the Vaisala Group during the
review period was 1107 (1070). 40% (40%) of the Group's personnel
worked outside Finland.
Changes in Vaisala Oyj's management
Matti Ervasti (51), M.A. (chemistry), was appointed as Vaisala Sales
and Marketing Director and member of the Management Group starting
May 15, 2007. Ari Meskanen (43), M.Sc.(Eng), eMBA, was appointed as
Vaisala Chief Technology Officer and member of the Management Group
starting May 1, 2007. Scott Sternberg (43), M.Sc.(Physics), was
appointed as Director of Vaisala Services and member of the
Management Group starting June 1, 2007. Antti Ritvos (53), M.Sc.
B.Sc., was appointed as Director of Vaisala Solutions and member of
the Management Group starting November 15, 2007.
Short-term risks and uncertainties
Vaisala's risk management policy covers strategic, operative,
accident, and financial risks. The goal of the policy is to ensure
the safety of Vaisala personnel, operations and products and
continuity of operations.
The usual risks related to international business affect Vaisala's
operations. The most significant of these relate to currency risks,
particularly the weakening US dollar, supply-chain management and
production activities, and these risks are closely monitored and
prepared for according to the company's risk management policy.
The prerequisite for the growth in net sales is the maintaining of
the order flow at current levels and the realization of deliveries as
planned.
Vaisala's share
Vaisala's Board of Directors had no authorization to increase the
company's share capital or to issue convertible or warrant bonds at
the end of the review period.
The price of Vaisala's A share on the Helsinki Exchanges was EUR
33.07 on December 31, 2006, and EUR 40.35 at the end of the review
period. The highest share price quoted during the review period was
EUR 41.99 and the lowest EUR 29.43. A total of 4,403,604 Vaisala
shares were traded during the review period.
Conversion of unlisted shares series K into series A
Vaisala Oyj's 400 unlisted shares (series K) have been converted into
listed shares (series A). The conversion has been registered in the
Finnish Trade Register September 20, 2007. Listing of the new series
A shares has been applied for as of September 21, 2007.
Vaisala's share capital at the end of the review period was EUR
7,660,807.86 and the total number of shares was 18,218,364. Of these,
3,408,885 belong to series K and 14,809,479 to series A.
Own and parent company's shares
The company holds a total of 9,150 of its own shares at the end of
the review period, representing 0.05% of the share capital and 0.01%
of votes. The book value of the shares owned by the company is EUR
251,898.31.
Board of Directors
The Annual General Meeting appointed six members to the Board of
Directors. Yrjö Neuvo, who was in turn to retire by rotation, was
selected for another three-year term of office. Maija Torkko was
appointed as a new member.
Raimo Voipio will continue as Chairman of the Board of Directors and
Yrjö Neuvo will continue as Vice-Chairman.
Dividend
The Annual General Meeting decided that a dividend of EUR 0.85 per
share, corresponding to the total of EUR 15,477,831.90 was to be
distributed for the financial year 2006. Dividend is not paid to the
A-shares that are held by Vaisala Oyj. Dividend was paid on April 3,
2007.
PricewaterhouseCoopers Oy and Mr. Hannu Pellinen APA were chosen as
the Company's auditors by the Annual General Meeting.
Vantaa October 31, 2007
Vaisala Oyj
Board of Directors
Financial indicators 1-9 1-9 7-9 7-9 1-12
2007 2006 2007 2006 2006
Number of shares at Sept. 30
(1000 pcs) 18 209 18 209 18 209 18 209 18 209
Number of chares at Sept. 30
(1000 pcs),weighted average 18 209 18 154 18 209 18 209 18 168
Adjusted number of shares
(1000 pcs) 18 209 18 162 18 209 18 209 18 174
Earnings/share (EUR) 0.81 0.73 0.17 0.37 1.46
Earnings/share (EUR),fully diluted 0.81 0.73 0.17 0.37 1.46
Net cash flow from operating
activities/share (EUR) 1.59 1.00 1.96
Equity/share (EUR) 9.16 8.67 9.16 8.67 9.32
Solvency ratio 83% 84% 83% 84% 81%
Gross capital expenditure
(EUR Million) 5.0 18.6 1.6 1.2 20.4
Depreciation (EUR million) 6.1 8.6 2.0 2.3 10.8
Average personnel 1 107 1 070 1 131 1 070 1 069
Order book (EUR Million) 99.0 87.7 99.0 87.7 77.6
Liabilities from derivative
contracts 13.1 11.9 13.1 11.9 11.9
This interim report has been prepared in accordance with IAS 34
'Interim Financial Reporting.' The same accounting principles have
been applied as in the annual financial statements. The interim
financial statements have not been audited.
CONSOLIDATED INCOME STATEMENT
(IFRS, EUR Million)
1-9 1-9 Change 7-9 7-9 Change 1-12
2007 2006 % 2007 2006 % 2006
Net sales 152.2 144.9 5.1 51.5 52.4 -1.8 220.8
Cost of production
and procurement -66.9 -68.4 -2.2 -23.1 -23.7 -2.3 -100.1
Gross profit 85.3 76.5 11.6 28.3 28.8 -1.4 120.8
Other operating
income 0.0 0.1 -98.7 0.0 0.0 -87.5 0.1
Cost of sales and
marketing -33.5 -29.9 12.1 -11.7 -10.2 14.5 -42.1
Development costs -16.8 -14.7 14.4 -6.4 -5.2 23.1 -20.6
Other administrative
costs -15.4 -12.9 19.3 -5.8 -4.7 23.5 -19.6
Other operating cost 0.0 0.0 0.0 0.0 0.0
Operating profit 19.6 19.1 3.0 4.5 8.7 -48.1 38.6
Financial income and
expenses 1.3 -0.3 -528.1 0.1 0.5 -84.6 -0.5
Share of results of
associated companies 0.0 0.0 0.0 0.0 0.0
Profit before tax 21.0 18.8 11.6 4.6 9.2 -50.2 38.2
Income taxes -6.1 -5.5 11.5 -1.6 -2.5 -35.8 -11.6
Profit after tax 14.8 13.3 11.6 3.0 6.8 -55.5 26.6
Attributable to
equity holders of
the parent 14.8 13.3 11.6 3.0 6.8 -55.5 26.6
Taxes for the review period have been calculated under
taxes.
Earnings per share for profit attributable to the equity holders of
the parent
Basic earnings per share 0.81 0.73 11.3 0.17 0.37 -55.6 1.46
Diluted earnings per share 0.81 0.73 11.4 0.17 0.37 -55.6 1.46
CONSOLIDATED BALANCE SHEET
(EUR million) 30.9.2007 30.9.2006 Change 31.12.2006
%
ASSETS
NON-CURRENT ASSETS
Intangible assets 18.6 22.2 -16.4 21.0
Tangible assets 32.9 33.0 -0.4 33.5
Investments in associates 0.4 0.3 30.7 0.4
Other financial assets 0.0 0.0 -9.5 0.2
Long-term receivables 0.1 0.2 -62.8 0.1
Deferred tax assets 5.2 6.0 -14.4 5.2
CURRENT ASSETS
Inventories 20.2 20.1 0.4 17.6
Trade and other receivables 39.2 42.3 -7.2 53.9
Accrued income tax receivables 0.8 0.8 3.3 0.0
Financial assets recognized at
fair
value through profit and loss 42.3 32.9 28.6 41.2
Cash and cash equivalents 52.7 39.2 34.3 46.1
TOTAL ASSETS 212.3 197.1 7.7 219.2
SHAREHOLDERS' EQUITY AND
LIABILITIES
Equity attributable to equity
holders of the parent
Share capital 7.7 7.7 0.0 7.7
Share premium reserve 16.6 16.6 0.0 16.6
Reserve fund 0.1 0.1 -6.1 0.1
Translation differences -3.9 -0.3 1020.2 -1.6
Profit from previous years 131.8 120.7 9.2 120.7
Own shares -0.3 -0.3 -1.6 -0.3
Profit for the financial year 14.8 13.3 11.7 26.6
Total equity 166.8 157.7 5.8 169.8
Long-term liabilities
Retirement benefit obligations 0.3 0.8 -57.7 0.3
Interest-bearing liabilities 0.3 0.4 -18.4 0.3
Provisions 0.0 0.3 -88.0 0.0
Deferred tax liabilities 0.3 0.3 -18.8 0.4
Current liabilities
Current portion of long-term
borrowings 0.1 0.1 0.0 0.3
Current interest-bearing
liabilities 0.1 0.1 -37.2 0.3
Advances received 11.5 9.3 23.0 9.6
Accrued income tax payables 2.4 0.9 167.3 2.6
Trade and other payables 30.4 27.1 12.3 35.6
TOTAL LIABILITIES 212.3 197.1 7.7 219.2
CONSOLIDATED STATEMENT OF CHANGES IN
SHAREHOLDERS' EQUITY
September 30, 2007 (EUR million)
Trans- Retain-
Share Share Re- lation ed
capi- Share Premium serve Own differ- earn- Total
tal issue reserve Fund shares ences ings equity
Balance at
December 31,
2006 7.7 0.0 16.6 0.1 -0.3 -1.6 147.3 169.8
Translation
differences 0.0 -2.3 -2.3
Net profit
for the
period 14.8 14.8
Dividend paid -15.5 -15.5
Stock options
exercised
Own shares
acquired
Own shares
transferred
Balance at
September 30,
2007 7.7 0.0 16.6 0.1 -0.3 -3.9 146.6 166.8
Trans- Retain-
Share Share Re- lation ed
capi- Share Premium serve Own differ- earn- Total
tal issue reserve Fund shares ences ings equity
Balance at
December 31,
2005 7.4 5.4 5.3 0.1 0.0 1.9 134.1 154.3
Translation
differences 0.0 -2.3 -2.3
Net profit
for
the period 13.3 13.3
Dividend paid -13.4 -13.4
Stock options
exercised 0.2 -5.4 11.3 6.1
Own shares
acquired -1.0 -1.0
Own shares
transferred 0.7 0.7
Balance at
September 30,
2006 7.7 0.0 16.6 0.1 -0.3 -0.3 133.9 157.7
CONSOLIDATED CASH FLOW STATEMENT
(EUR million)
1-9 1-9 Change 1-12
2007 2006 % 2006
Cash flows from operating activities
Cash receipts from customers 170.0 154.7 9.9 220.3
Other income from business operations 0.0 0.0 -93.1 0.0
Cash paid to suppliers and employees -135.8 -129.0 5.3 -173.7
Interest received 2.4 1.5 62.0 2.2
Interest paid -0.1 -0.1 21.4 -0.1
Other financial items, net -0.1 -2.5 -96.8 -3.3
Dividend received from business
operations 0.0 0.0 -100.0 0.0
Direct tax paid -7.4 -6.3 17.6 -9.7
Cash flow from business operations (A) 29.0 18.3 58.7 35.7
Cash flow from investing activities
Investments in tangible and intangible
assets -5.1 -5.4 -6.0 -7.2
Acquisition of subsidiary, net of cash
acquired 0.0 -15.6 -100.0 -15.7
Proceeds from sale of fixed assets 0.0 0.1 -99.0 0.1
Loans granted 0.0 0.0 -100.0 0.0
Repayments on loan receivables 0.0 0.0 93.7 0.0
Other investments 0.1 0.0 864.1 -0.1
Cash flow from investing activities (B) -4.9 -20.9 -76.4 -22.9
Cash flow from financing activities
Equity issue 0.0 6.1 -100.0 6.1
Repayment of short-term loans 0.0 0.0 0.0
Withdrawal of long-term loans 0.0 0.0 0.0
Repayment of long-term loans -0.2 -0.4 -59.4 -0.5
Dividend paid and other distribution
of profit -15.5 -13.4 15.2 -13.4
Cash flow from financing activities (C) -15.6 -7.7 102.0 -7.8
Change in liquid funds (A+B+C)
increase (+) / decrease (-) 8.4 -10.3 -181.4 5.0
Liquid funds at beginning of period 87.3 81.4 7.3 81.4
Foreign exchange effect on cash -0.8 1.0 -175.6 0.9
Net increase in cash and cash
equivalents 8.4 -10.3 -181.4 5.0
Liquid funds at end of period 95.0 72.1 31.7 87.3
Segment Report
Business segments
Vaisala
Measure- Vaisala Other
ment Instru- Vaisala Opera- Elimina-
1-9/2007 Systems ments Solutions tions tions Group
Net sales to
external customers 59.0 51.7 41.6 0.0 0.0 152.2
Intragroup sales 0.0 6.4 0.3 0.0 -6.7 0.0
Net sales 59.0 58.1 41.9 0.0 -6.7 152.2
Operating profit 9.5 14.9 -1.1 -3.7 0.0 19.6
Depreciation 2.0 1.4 0.3 2.4 0.0 6.1
Restructuring
expenses 0.0 0.0 0.0 0.0 0.0 0.0
Segment Report
Business segments
Vaisala
Measure- Vaisala Other
ment Instru- Vaisala Opera- Elimina-
1-9/2006 Systems ments Solutions tions tions Group
MEUR
Net sales to
external customers 59.5 47.2 38.2 0.0 0.0 144.9
Intragroup sales 0.0 7.1 0.3 0.0 -7.4 0.0
Net sales 59.5 54.3 38.5 0.0 -7.4 144.9
Operating profit 8.5 14.5 -0.5 -3.3 0.0 19.1
Depreciation 4.1 1.5 0.5 2.5 0.0 8.6
Restructuring
expenses 0.0 0.0 0.0 0.0 0.0 0.0
Segment Report
Business segments
Vaisala
Measure- Vaisala Other
ment Instru- Vaisala Opera- Elimina-
7-9/2007 Systems ments Solutions tions tions Group
Net sales to
external customers 18.9 17.2 15.4 0.0 0.0 51.5
Intragroup sales 0.0 2.7 0.2 0.0 -2.9 0.0
Net sales 18.9 19.9 15.5 0.0 -2.9 51.5
Operating profit 2.3 4.4 -0.4 -1.9 0.0 4.5
Depreciation 0.6 0.4 0.1 0.8 0.0 2.0
Restructuring
expenses 0.0 0.0 0.0 0.0 0.0 0.0
Segment Report
Business segments
Vaisala
Measure- Vaisala Other
ment Instru- Vaisala Opera- Elimina-
7-9/2006 Systems ments Solutions tions tions Group
MEUR
Net sales to
external customers 21.3 17.2 14.0 0.0 0.0 52.4
Intragroup sales 0.0 2.6 0.1 0.0 -2.7 0.0
Net sales 21.3 19.8 14.1 0.0 -2.7 52.4
Operating profit 4.5 5.4 0.7 -1.8 0.0 8.7
Depreciation 0.8 0.5 0.1 0.8 0.0 2.2
Restructuring
expenses -0.4 0.0 0.0 0.0 0.0 -0.4
Vaisala
Measure- Vaisala Other
ment Instru- Vaisala Opera- Elimina-
1-12/2006 Systems ments Solutions tions tions Group
MEUR
Net sales to
external customers 93.2 64.3 63.3 0.0 0.0 220.8
Intragroup sales 0.0 11.1 0.4 0.0 -11.5 0.0
Net sales 93.2 75.3 63.7 0.0 -11.5 220.8
Operating profit 19.8 19.5 5.4 -6.1 0.0 38.6
Depreciation 4.8 1.9 0.7 3.4 0.0 10.8
Restructuring
expenses 0.0 0.0 0.0 0.0 0.0 0.0
Calculation of financial indicators
Shareholders' equity plus minority
interest
Solvency ratio, (%) = --------------------------------------- x 100
Balance sheet total less advance payments
Profit before taxes less taxes
+/- minority interest
Earnings / share = ---------------------------------------
Average number of shares, adjusted
Cash flow from business operations
Cash flow from
business = ---------------------------------------
operations / share Number or shares at balance sheet date
Shareholders' equity
Equity / share = ---------------------------------------
Number of shares at balance sheet date,
adjusted
Dividend
Dividend / share = ----------------------------------------
Number of shares at balance sheet date,
adjusted
Further information:
Jouni Lintunen
CFO, tfn +358 9 8949 2215, GSM +358 40 579 0181www.vaisala.com
Vaisala Oyj
Distribution:
Nordic Exchange
Finnish News Agency
Major Media