Financial results for IV Quarter, 2007
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| BALANCE SHEET | As at 31 December | As at 31 December |
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| (In thousands) | EEK | | EUR | |
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| | | Restated | | Restated |
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| | 2007 | 2006 | 2007 | 2006 |
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| ASSETS | | | | |
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| Cash and cash equivalents | 15,746 | 118,876 | 1,006 | 7,597 |
| (note 2) | | | | |
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| Trade receivables (note 3) | 88,951 | 71,944 | 5,685 | 4,598 |
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| Other receivables and | 33,120 | 7,883 | 2,117 | 504 |
| prepayments (note 4) | | | | |
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| Inventories (note 5) | 57,257 | 58,771 | 3,659 | 3,756 |
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| TOTAL CURRENT ASSETS | 195,074 | 257,474 | 12,467 | 16,455 |
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| Non-current assets | | | | |
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| Long-term financial | 6,100 | 7,740 | 390 | 495 |
| investments (note 6) | | | | |
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| Property, plant and | 280,552 | 277,788 | 17,931 | 17,754 |
| equipment (note 7) | | | | |
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| Intangible assets (note 8) | 491 | 990 | 31 | 63 |
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| TOTAL NON-CURRENT ASSETS | 287,143 | 286,518 | 18,352 | 18,312 |
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| TOTAL ASSETS | 482,217 | 543,992 | 30,819 | 34,767 |
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| LIABILITIES AND EQUITY | | | | |
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| Current liabilities | | | | |
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| Lease liabilities (note 9) | 110 | 131 | 7 | 8 |
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| Trade payables | 23,666 | 27,472 | 1,513 | 1,756 |
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| Other payables (note 10) | 83,954 | 58,197 | 5,365 | 3,720 |
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| Packaging repurchase | 43,359 | 27,850 | 2,771 | 1,780 |
| provision (note 11) | | | | |
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| TOTAL CURRENT LIABILITIES | 151,089 | 113,650 | 9,656 | 7,264 |
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| Non-current liabilities | | | | |
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| Finance lease liabilities | 239 | 376 | 16 | 24 |
| (note 9) | | | | |
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| TOTAL LIABILITIES | 151,328 | 114,026 | 9,672 | 7,288 |
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| Equity (note 12) | | | | |
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| Share capital | 80,000 | 80,000 | 5,113 | 5,113 |
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| Statutory capital reserve | 8,000 | 8,000 | 511 | 511 |
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| Retained earnings | 141,966 | 227,099 | 9,073 | 14,514 |
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| Profit for the period | 100,923 | 114,867 | 6,450 | 7,341 |
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| TOTAL EQUITY | 330,889 | 429,966 | 21,147 | 27,479 |
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| TOTAL LIABILITIES AND | 482,217 | 543,992 | 30,819 | 34,767 |
| EQUITY | | | | |
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| INCOME STATEMENT, Q4 | | | | |
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| (In thousands) | EEK | EUR |
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| | 2007 | 2006 | 2007 | 2006 |
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| Sales revenue and other | | | | |
| income | | | | |
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| Sales revenue (note 14) | 190,884 | 175,065 | 12,199 | 11,188 |
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| Other income | 6,475 | 976 | 414 | 63 |
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| Total sales revenue and | 197,359 | 176,041 | 12,613 | 11,251 |
| other income | | | | |
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| Expenses | | | | |
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| Changes in work in progress | | | | |
| and | | | | |
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| finished goods inventories | -888 | 1,751 | -57 | 112 |
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| Cost of materials, | 72,305 | 71,133 | 4,620 | 4,547 |
| consumables and services | | | | |
| used (note 15) | | | | |
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| Other operating expenses | 77,018 | 48,177 | 4,923 | 3,079 |
| (note 15) | | | | |
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| Labour costs (note 15) | 23,595 | 22,841 | 1,508 | 1,459 |
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| Depreciation and | 14,944 | 14,716 | 956 | 941 |
| amortisation charges (notes | | | | |
| 7, 8) | | | | |
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| Other expenses (note 15) | 728 | 1,033 | 46 | 65 |
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| Total expenses | 187,702 | 159,651 | 11,996 | 10,203 |
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| Q4 OPERATING PROFIT | 9,657 | 16,390 | 617 | 1,048 |
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| Net financial items (note | -92 | 835 | -6 | 53 |
| 16) | | | | |
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| Q4 NET PROFIT | 9,565 | 17,225 | 611 | 1,101 |
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| Basic earnings per share | 0.0012 | 0.002 | 0.00008 | 0.00014 |
| (note 17) | | | | |
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| Diluted earnings per share | 0.0012 | 0.002 | 0.00008 | 0.00014 |
| (note 17) | | | | |
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Review of performance and operating results
The company's fourth quarter revenue rose to 197.3 million kroons (12.6 million
euros), a 12% improvement year-over-year. Operating profit amounted to 9.7
million kroons (617 000 Euros) against 16.4 million kroons (1.1 million euros)
in the fourth quarter of 2006. Fourth quarter net profit equalled 9.6 million
kroons (611 000 euros). The main growth drivers were sales of Saku's other
beverages and maintenance of the value-based market share in the beer market,
notwithstanding the decline of the market. The decrease in operating profit is
not related to the company's operating results but stems from the revaluation of
packaging performed for financial accounting purposes according to reasonable
knowledge based on a new Packaging Act which entered into force in autumn 2005.
The company is the clear leader in beer market in litres and value. According to
the market research company ACNielsen, in 2007 the Estonian beer market broke
down as follows (in terms of litres): Saku Õlletehase AS, the leader, 46.3%
(2006: 47.3%), AleCoq 34.2% (2006: 33.0%), Viru Õlu 4.4% (2006: 6.2%) and
private label 10.1% (2006: 6.2%)
The company's core market is the domestic beer market. According to the Estonian
Breweries' Association, in 2007 the total volume of the Estonian beer market was
128 million litres. With a 1.4% decline, the market volume remained similar to
2006. Compared with prior years, the beer market seems to be stabilising in the
context of continuing growth in the sales of other alcoholic beverages.
Although the beer market sustained growth in the first half of 2007, the second
half-year brought significant monthly declines which left the annual market
volume at the level of the prior year. The decline of the market may be
attributed to the general cooling of the economic environment, including a
decrease in the proportion of tourists which has been the driver of Estonian
alcohol sales since 2004 when Estonia joined the EU. In addition, the market was
adversely affected by chaotic regional sales restrictions which caused the
strongest setback in the sales of premium brands.
In the period, total sales of the company was amounted as 18,5 m litres, last
year same period reached total sales to 20,9 m litres. Due to changes in
business environment in the second half of the year, quality bränds sales
underperformed in beer and cider sector, but it was compensated by good
christmas sales on December supported by marketing activities and sales
activities focused on premium brands. Seoses keskkonnamuutustega said
kvaliteetmargid õlle- ja siidrisektoris tagasilöögi oktoobris ja novembris,
mille suures osas kompenseeris edukas jõulumüük, mida toetasid tegevused nii
pakendikujunduste (eripakendid kvaliteetmarkidele) kui ka eripakkumised. In the
period continued good sales of Saku table water brands.
In the fourth quarter, the company invested in new-generation multi-pack
equipment which allows wrapping both cans and bottles.
Fourth quarter export sales remained strong. The main export markets were the
other Baltic countries, Finland and, to a lesser extent, the USA, Canada and
Ireland.
Additional information:
Kristina Seimann
Communication Manager
+372 6508 400
Kristina.Seimann@pruul.ee