Interim Report January 1 - March 31, 2008: Slow start to the year as expected



HUHTAMÄKI OYJ STOCK EXCHANGE RELEASE 23.4.2008 AT 9:00
 
- Group net sales in slight decline due to adverse currency impact
- Lower earnings than in previous year due to weak performance in
Films and in
Asia-Oceania-Africa
- Raw material costs on a record high level
- Improving trend in free cash flow
- New segment reporting to improve transparency
 

Key figures                             
EUR million          Q1 2008 Q1 2007    
Net sales           548.6    564.7      
EBIT                20.0     37.7       
EBIT margin %       3.6      6.7        
EPS                 0.09     0.24       
ROI % (12m roll.)   0.8      9.3        

 
Overview
The decline  in the  Group  net sales  was  due to  adverse  currency
translation impact. In constant currencies the Group achieved  modest
growth. The first quarter 2008 earnings were below the same period in
the previous year. The main reasons for the lower earnings were  weak
performance in the Films business and a significant one time gain  of
EUR 6 million received  during the first  quarter 2007. In  addition,
there was  an adverse  currency  impact and  the raw  material  costs
remained on a record high level.
 
Business review by segment
Starting from 2008 Huhtamaki's segment reporting was revised to
improve transparency. The five new segments, in line with the Group's
internal management structure, are: Flexibles and Films Global, Rigid
Europe, Molded Fiber Europe, Rigid and Molded Fiber Americas as well
as Rigid and Molded Fiber Asia-Oceania-Africa. These will replace the
former geographical segments (Europe, Americas, Asia-Oceania-Africa).
 
Flexibles and Films Global
Flexibles and Films are organized as a global segment. Flexibles are
used for food and pet food packaging as well as non-food consumer
packaging. Films are mainly used for technical applications in the
label, adhesive tape, hygiene and health care industries as well as
building and construction, automotive, packaging and graphic arts
industries.
 

                                         
EUR million           Q1 2008 Q1 2007    
Net sales            179.3    186.9      
EBIT                 6.6      14.7       
EBIT margin %        3.7      7.9        
RONA % (12m roll.)   5.7      11.5       

 
Sales decline within the segment was due to weakness in Films.
Additionally, sales development in Flexibles North America and Europe
was slow. This was partially offset by robust growth in Flexibles
Asia.
 
Profitability reflects lower than expected volumes, operational
inefficiency as well as margin pressure due to higher raw material
costs. Films continued to suffer from operational issues following
the earlier implementation of the enterprise resource planning (ERP)
platform as well as the transfer of the release paper line from
Göttingen to Forchheim, Germany. In Flexibles, the weak price/mix
development continued in Europe and the ongoing ramp-up of new
capacity added to the facility in Malvern, USA, had a negative impact
on profitability. Sales growth in India and Thailand contributed
positively to earnings.
 
Construction of the new flexible packaging facility in Bangkok,
Thailand, proceeded according to schedule with production expected to
commence around mid-year.
 
Rigid Europe
Rigid paper and plastic packaging serves foodservice and consumer
goods markets in Europe with fresh food, dairy, ice cream, beverage
and personal care packaging as well as disposable tableware. Rigid
packaging is supplied to foodservice operators, fast food restaurants
and food manufacturers.
 

                                         
EUR million           Q1 2008 Q1 2007    
Net sales            151.0    147.1      
EBIT                 1.5      0.2        
EBIT margin %        1.0      0.1        
RONA % (12m roll.)   -14.6    -2.8       

 
Foodservice experienced a good, broad based growth within the
segment, while sales in Consumer Goods were soft in Germany and in
the UK.
 
Profitability reflects favorable mix development as well as an
improving trend in operational efficiency.
 
Molded Fiber Europe
Molded fiber is used to make fresh product packaging, such as egg and
fruit packaging.
 

                                         
EUR million           Q1 2008 Q1 2007    
Net sales            35.4     34.6       
EBIT                 2.9      2.4        
EBIT margin %        8.2      6.9        
RONA % (12m roll.)   9.3      10.2       

 
Sales and earnings within the segment remained good due to favorable
development in Eastern Europe and in the waste paper trading
business. A tougher competitive environment had a negative impact on
sales in the UK.
 
Rigid and Molded Fiber Americas
Rigid paper and plastic packaging, which serves ice-cream and other
consumer goods as well as foodservice markets, is complemented with
Molded Fiber Chinet® disposable tableware products. Similar market
channels are a common denominator.
 

                                         
EUR million           Q1 2008 Q1 2007    
Net sales            133.3    142.9      
EBIT                 9.2      17.2       
EBIT margin %        6.9      12.0       
RONA % (12m roll.)   8.0      13.6       

 
Sales growth in constant currencies was solid with good growth in
Retail and in South America. Market softness persisted in Frozen
desserts, spreading also into Foodservice during the quarter.
 
Profitability was stable on a comparable basis; excluding the EUR 6
million one time gain in 2007 as well as adverse currency translation
impact.
 
Rigid and Molded Fiber Asia-Oceania-Africa
Rigid paper and plastic packaging serves foodservice and consumer
goods markets. The segment also includes the Molded Fiber business
which makes fresh product packaging.
 

                                         
EUR million           Q1 2008 Q1 2007    
Net sales            52.5     56.6       
EBIT                 -0.2     3.3        
EBIT margin %        -0.4     5.8        
RONA % (12m roll.)   1.5      6.6        

 
Good growth in Asia did not compensate for the weak sales development
in South Africa and in Consumer Goods Oceania.
 
Profitability reflects low sales as well as operational inefficiency
in Oceania, the start-up costs in new capacity in Asia and market
turmoil experienced in South Africa.
 
The relocation from the site in Hong Kong to the new facility in
Guangzhou, China, is progressing with completion expected during the
first half of this year.
 
 
Financial review
The Group EBIT was EUR 20 million (EUR 38 million in the first
quarter 2007), corresponding to an EBIT margin of 3.6% (6.7%). At EUR
9 million, the net financial items were unchanged from the previous
year. The income tax expense was EUR 2 million (EUR 4 million). The
result for the period was EUR 9 million (EUR 24 million). The
earnings per share (EPS) were EUR 0.09 (EUR 0.24). The average number
of outstanding shares used in the EPS calculation was 100,426,461
(unchanged) excluding 5,061,089 (unchanged) Company's own shares.
 
Balance sheet and cash flow
Free cash flow for the quarter was EUR -12 million (EUR -37 million).
The improving trend was due to more efficient working capital
management as well as lower capital expenditure. Capital expenditure
amounted to EUR 14 million (EUR 24 million). Net debt was EUR 741
million (EUR 743 million). This corresponds to a gearing ratio of
1.01 (0.84).
 
Personnel
The Group had 15,198 (14,885) employees at the end of March 2008.
 
New CEO appointed
Mr. Jukka Moisio was appointed by the Board of Directors as Huhtamäki
Oyj's CEO, effective from April 1, 2008.
 
Resolutions taken by the Annual General Meeting
The Annual General Meeting (AGM) of Huhtamäki Oyj was held on March
31, 2008 in Helsinki, Finland. The meeting approved the Company's
Financial Statements and the Consolidated Financial Statements for
2007 and discharged the Company's Board of Directors and the CEO from
liability. The dividend for 2007 was set at EUR 0.42 per share
(unchanged). To the Board of Directors were re-elected Ms. Eija
Ailasmaa, Mr. George V. Bayly, Mr. Robertus van Gestel, Mr. Mikael
Lilius, Mr. Anthony J.B. Simon and Mr. Jukka Suominen. Mr. Rolf
Börjesson was elected as a new member to the Board of Directors. The
Board of Directors elected Mikael Lilius as the Chairman of the Board
and Jukka Suominen as the Vice Chairman of the Board. In addition,
the Board of Directors resolved upon members of its committees for a
term which lasts until the end of the Annual General Meeting
following the election.
 
Events after the reporting period
Huhtamaki has completed the review of different strategic options for
its operations in South Africa and for its Rigid Consumer Goods
business unit in the UK. As a result of the review Huhtamaki has
decided to continue its operations in South Africa. In the UK,
Huhtamaki is aiming to cease production of rigid plastic consumer
goods packaging due to volume decline as well as continued increases
in manufacturing and energy costs. The Consumer Goods business unit
is loss-making with annual net sales of around EUR 30 million. The
annualized earnings improvement is expected to be EUR 3-4 million. A
consultation process will start in relation to approximately 160
employees impacted at the Portadown and Gosport sites. Huhtamaki will
continue to serve the UK Consumer Goods customers with specialty
products, mainly paper based, from other Huhtamaki facilities. The
manufacturing of foodservice products at the Gosport site will
continue.
 
Huhtamaki has started union negotiations in Karlholmsbruk, Sweden,
with the aim to close down the rigid packaging site. The annual net
sales of the site are around EUR 4 million and it currently employs
approximately 40 people. Huhtamaki intends to concentrate its EPS
(Expanded Polystyrene) packaging business in Europe to the facility
in Siemianowice, Poland, where similar production already exists. The
customers of the site to be closed will be served from facilities in
Poland and in Finland.
 
Short-term risks and uncertainties
Volatile raw material and energy prices as well as movements in
currency translations are considered to be relevant short-term
business risks and uncertainties in the Group's operations.
 
Outlook for 2008
The underlying Group  EBIT in  2007 was  EUR 136  million*. In  2008,
Group EBIT is expected  to be at this  level before costs related  to
the planned closures of operations in the UK and Sweden. These  costs
are expected to have an  approximately EUR 10 million adverse  impact
on EBIT. At  approximately EUR  100 million,  capital expenditure  is
expected to be significantly lower than in 2007.
 
*Excluding restructuring,  goodwill  impairment  and  tangible  asset
impairment charges, total amount EUR 108 million.
 
Financial reporting in 2008
Huhtamaki will publish the interim report for January 1 - June 30,
2008 on July 18 and January 1 - September 30, 2008 on October 22.
 
Espoo, April 22, 2008
Huhtamäki Oyj
Board of Directors
 
For further information, please contact:
Mr. Jukka Moisio, CEO, tel. +358-10-686 7801
Mr. Timo Salonen, CFO, tel. +358-10-686 7880
Ms. Kia Aejmelaeus, Head of Investor Relations, tel. +358-10-686 7819
or mobile +358-40-765 4616
Ms. Minna Staffans, Head of Group Communications, tel. +358-10-686
7863 or mobile +358-50-527 6696
 
A news conference for analysts, investors and media will be held at
11:00 Finnish time at the head office, address Keilaranta 10, Espoo.
CEO Jukka Moisio and CFO Timo Salonen will present the results. A
conference call for analysts and investors will start at 16:00
Finnish / 14:00 UK / 09:00 New York time with a management
presentation, followed by a question and answer session. To
participate, please dial one of the following numbers 5-10 minutes
prior to the call start:
- Number for participants from Finland: 0923 114 173
- Number for participants outside of Finland: +44 (0) 1452 555 566
- Conference ID: 42923097
All results materials will be available on www.huhtamaki.com. The
results presentation slides will be online approximately at 11:00
Finnish time. A replay of the conference call in the form of an audio
webcast will be available during the same evening.
 

Group Income statement                          
(IFRS)                                          
Unaudited                                       
                                 Q1     Q1     Q1-Q4
EUR million                      2008   2007   2007
                                                
Net sales                        548.6  564.7  2,311.0
Cost of goods sold               -474.9 -479.1 -2,028.0
Gross profit                     73.7   85.6   283.0
                                                
                                                
Other operating income           3.7    10.0   31.9
Sales and marketing              -19.8  -20.0  -83.6
Research and development         -4.3   -4.8   -17.8
Administration costs             -29.2  -30.1  -122.6
Other operating expenses         -4.1   -3.0   -62.8
                                 -53.7  -47.9  -254.9
                                                
Earnings before interest                        
and taxes                        20.0   37.7   28.1
                                                
Financial income                 4.0    1.7    9.2
Financial expenses               -12.6  -10.8  -51.7
Income of associated                            
companies                        0.1    0.1    0.4
Result before taxes              11.5   28.7   -14.0
                                                
                                                
Income tax expense               -2.1   -4.3   -6.2
                                                
Result for the period            9.4    24.4   -20.2
                                                
                                                
Attributable to:                                
Equity holders of the                           
parent company                   8.7    23.9   -22.5
Minority interest                0.7    0.5    2.3
                                                
                                                
Basic earnings per share (EUR)                  
for the shareholders of parent                  
company                          0.09   0.24   -0.22
Diluted earnings per share (EUR)                
for the shareholders of                         
parent company                   0.09   0.24   -0.22

 
 

Group balance sheet                            
(IFRS)                                         
Unaudited                                      
                              Mar 31  Dec 31  Mar 31
EUR million                   2008    2007    2007
                                               
ASSETS                                         
Non-current assets                             
Goodwill                      465.7   471.9   524.2
Other intangible assets       41.2    41.4    37.7
Tangible assets               760.6   799.3   839.0
Investments in associated                      
companies                     1.4     1.5     1.6
Available for sale                             
investments                   1.9     1.9     1.7
Interest bearing                               
receivables                   0.4     0.9     6.1
Deferred tax assets           15.8    13.7    15.5
Employee benefit assets       55.5    59.2    63.7
Other non-current assets      3.7     4.8     5.0
                              1,346.2 1,394.6 1,494.5
Current assets                                 
Inventory                     359.1   348.5   375.7
Interest bearing                               
receivables                   2.9     4.6     0.0
Current tax assets            12.3    17.9    10.5
Trade and other current                        
receivables                   399.4   394.8   418.8
Cash and cash                 40.5    30.8    25.2
equivalents                                    
                              814.2   796.6   830.2
                                               
Total assets                  2,160.4 2,191.2 2,324.7
                                               
EQUITY AND LIABILITIES                         
Share capital                 358.7   358.7   358.7
Premium fund                  104.7   104.7   104.7
Treasury shares               -46.5   -46.5   -46.5
Translation differencies      -145.6  -121.1  -108.2
Fair value and other                           
reserves                      -0.7    1.4     2.9
Retained earnings             445.6   475.7   555.8
Total equity attributable                      
to equity holders                              
of the parent company          716.2   772.9   867.4
                                               
Minority interest             19.4    20.5    20.0
Total equity                  735.6   793.4   887.4
                                               
Non-current liabilities                        
Interest bearing liabilities  383.9   401.1   311.8
Deferred tax liabilities      38.1    38.8    66.4
Employee benefit liabilities  105.4   108.8   111.8
Provisions                    57.6    60.3    46.1
Other non-current liabilities 4.3     4.3     4.0
                               589.3   613.3   540.1
Current liabilities                            
Interest bearing liabilities                   
-Current portion of long term                  
loans                         22.2    17.9    45.6
                                               
-Short term loans             378.5   365.7   416.6
Provisions                    6.6     8.0     8.4
Current tax liabilities       17.6    21.1    19.0
Trade and other current                        
liabilities                   410.6   371.8   407.6
                               835.5   784.5   897.2
                                               
Total liabilities             1,424.8 1,397.8 1,437.3
Total equity and liabilities  2,160.4 2,191.2 2,324.7
                                               
                              Mar 31  Dec 31  Mar 31
                              2008    2007    2007
                                               
Net debt                      740.8   748.5   742.6
Net debt to equity                             
(gearing)                     1.01    0.94    0.84

 

Changes in                                                                     
shareholders'                                                                  
equity                                                                         
Unaudited                                                                      
                                                                               
                                  Attributable to equity holders Minority Total
                                           of the parent company interest
EUR             Share   Share  Trea- Trans-   Fair    Re-  Total               
million       capital   Issue   Sury lation  value tained
                      premium shares  diff.    and   ear-
                                             other  nings
                                            reser-
                                               ves
                                                          equity               
                                                                               
                                                                               
Balance at                                                                     
 Dec 31, 2006 358.7   104.7   -46.5  -106.7 2.1    528.8  841.1  19.3     860.4
Cash flow                                                                      
hedges                                                                         
- Hedge                                                                        
result
deferred                                                                       
to equity                                   0.8           0.8             0.8
- Hedge                                                                        
result
recognized in                                                                  
 income
statement                                   -1.4          -1.4            -1.4
Translation                                                                    
differences                          -1.5                 -1.5   0.2      -1.3
Deferred tax                                                                   
in equity                                   1.4           1.4             1.4
Other changes                                      2.7    2.7             2.7
Income and                                                                     
expense
recognized                                                                     
directly
in equity                            -1.5   0.8    2.7    2.1    0.2      2.3
Result for                                                                     
the period                                         23.9   23.9   0.5      24.4
Total                                                                          
recognized 
income                                                                         
and expense
for the
period                               -1.5   0.8    26.7   26.0   0.7      26.7
Dividend                                           0.0    0.0             0.0
Share-based                                                                    
payments                                           0.3    0.3             0.3
Balance at                                                                     
Mar 31, 2007  358.7   104.7   -46.5  -108.2 2.9    555,8  867.4  20.0     887.4
                                                                               
                                                                               
Balance at                                                                     
Dec 31, 2007  358.7   104.7   -46.5  -121.1 1.4    475.7  772.9  20.5     793.4
Cash flow                                                                      
hedges                                                                         
- Hedge                                                                        
result 
deferred to                                                                    
equity                                      -0.2          -0.2            -0.2
-Hedge                                                                         
result  
recognized in                                                                  
income
statement                                   -0.2          -0.2            -0.2
-Hedge                                                                         
result    
transferred                                                                    
to
carrying                                                                       
amount of
hedged items                                0.7           0.7             0.7
Translation                                                                
differences                          -24.5                -24.5  -1.8     -26.3
Deferred tax                                                               
in equity                                   0.6           0.,6            0.6
Other changes                                      3.0    3.0             3.0
Income and                                                                     
expense                                                                        
recognized
directly in
equity                               -24.5  -2.1   3.0    -23.6  -1.,8    -25.4
Result for                                                                     
the period                                         8.7    8.7    0.7      9.4
Total                                                                          
recognized 
income                                                                         
and expense
for the
period                               -24.5  -2.1   11.7   -14.9  -1.1     -16.0
Dividend                                           -42.2  -42.2           -42.2
Share-based                                                                    
payments                                           0.4    0.4             0.4
Balance at                                                                     
Mar 31, 2008  358.7   104.7   -46.5  -145.6 -0.7   445.6  716.2  19.4     735.6

 
 

Group cash                           
flow statement                       
(IFRS)                               
Unaudited                            
                      Q1     Q1     Q1-Q4
EUR million           2008   2007   2007
                                     
                                     
Result for                           
the period*           9.4    24.4   -20.2
Adjustments*          30.9   33.5   243.2
- Depreciation,                      
amortization                         
and impairment*       23.1   24.5   203.3
- Gain on                            
equity of                            
minorities*           -0.1   -0.1   -0.4
- Gain/loss                          
from disposal                        
of assets*            -      0.2    -8.1
- Financial                          
expense/-income*      8.6    9.1    42.5
- Income tax                         
expense*              2.0    4.3    6.2
- Other adjustments,                 
 operational*         -2.7   -4.5   -0.3
Change in                            
 inventory*           -22.0  -34.7  -14.8
Change in                            
non-interest bearing                 
receivables*          -8.3   -19.6  -3.7
Change in                            
non-interest bearing                 
payables*             -0.1   -1.9   -38.5
Dividends                            
received*             0.1    0.1    0.9
Interest                             
 received*            0.8    0.6    1.3
Interest paid*        -10.0  -12.2  -42.7
Other financial                      
expense                              
and income*           2.0    -0.2   -1.1
Taxes paid*           -1.5   -1.9   -18.6
Net cash                             
flows from                           
operating activities  1.3    -11.9  105.8
                                     
Capital                              
expenditure*          -13.5  -25.6  -147.9
Proceeds                             
from selling                         
 fixed assets*        0.2    1.1    14.3
Proceeds                             
from long-term                       
deposits              0.9    0.5    7.2
Payment of                           
long-term deposits    -0.3   -0.1   -6.1
Proceeds from                        
short-term deposits   4.5    0.5    11.5
Payment of                           
short-term deposits   -2.9   -      -11.0
Net cash flows                       
from investing        -11.1  -23.6  -132.0
                                     
Proceeds from                        
long-term borrowings  128.6  164.8  520.2
Repayment of                         
long-term borrowings  -143.5 -169.0 -434.4
Proceeds from                        
short-term borrowings 849.1  691.8  2,987.4
Repayment of                         
short-term borrowings -813.8 -649.4 -2,995.0
Dividends paid        -      -      -42.2
Net cash flows                       
 from financing       20.4   38.2   36.0
                                     
Change in                            
liquid assets         9.7    2.9    8.5
Cash flow                            
 based                10.6   2.7    9.8
Translation                          
 difference           -0.9   0.2    -1.3
                                     
Liquid assets                        
period start          30.8   22.3   22.3
Liquid assets                        
period end            40.5   25.2   30.8
                                     
Free cash flow                       
(including figures                   
 marked with *)       -12.0  -36.4  -27.8

 
 
NOTES FOR THE INTERIM REPORT
 
This interim report has been prepared in accordance with IAS 34
Interim Financial Reporting. Except for accounting policy changes
listed below, the same accounting policies have been applied in the
interim financial statements as in annual financial statements for
2007.
 
Interim report is unaudited.
 
Changes in accounting principles
 
The Group has adopted the following IFRS standards and
interpretations considered applicable to Huhtamaki, with effect from
January 1, 2008:
 
- IFRS 8 Operating segments. IFRS 8 assumes that segment reporting
reflects the Group's management and internal reporting structure. The
five new segments are in line with Huhtamaki's internal management
structure and will replace the former geographical segments.
- IFRIC 14 IAS 19 The Limit on a Defined Benefit Asset, Minimum
Funding requirements and their Interaction. The interpretation
provides guidance on assessing the amount of the surplus that can be
recognized as defined benefit asset. It also explains how the pension
asset or liability may be affected by a statutory or contractual
minimum funding requirement.
 
These newly adopted standards have not had a material impact on the
reported results.
 
Segments
Segment information is presented according to the IFRS tandards.
Items below EBIT - financial items and taxes - are not allocated to
the segments.
 

Net sales                                       
                 Q1    Q4    Q3    Q2    Q1    Q1-Q4
EUR million      2008  2007  2007  2007  2007  2007
                                                
Flexibles and                                   
Films Global     178.4 167.9 176.3 175.1 185.7 705.0
- Intersegment                                  
net sales        0.9   0.8   1.2   1.0   1.2   4.2
Rigid Europe     149.9 148.7 161.7 172.1 146.0 628.5
- Intersegment                                  
net sales        1.1   1.5   1.6   1.2   1.1   5.4
Molded Fiber                                    
Europe           35.4  36.5  33.5  34.2  34.3  138.5
- Intersegment                                  
net sales        0.0   0.2   0.0   0.4   0.3   0.9
Rigid and                                       
Molded Fiber                                    
Americas         132.5 143.6 153.5 166.5 142.2 605.8
- Intersegment                                  
net sales        0.8   0.9   0.9   0.7   0.7   3.2
Rigid and                                       
Molded Fiber                                    
AOA              52.5  61.1  57.4  58.2  56.5  233.2
- Intersegment                                  
net sales        0.0   -0.2  0.1   0.1   0.1   0.1
Elimination of                                  
intersegment                                    
net sales        -2.9  -3.2  -3.8  -3.4  -3.4  -13.8
Total            548.6 557.8 582.4 606.1 564.7 2,311.0
                                                
EBIT                                            
                 Q1    Q4    Q3    Q2    Q1    Q1-Q4
EUR million      2008  2007  2007  2007  2007  2007
                                                
                                                
Flexibles and                                   
Films Global (1  6.6   -0.5  11.8  12.5  14.7  38.5
Rigid Europe (2  1.5   -74.3 3.5   3.3   0.2   -67.3
Molded Fiber                                    
Europe           2.9   3.5   2.5   2.3   2.4   10.7
Rigid and                                       
Molded Fiber                                    
Americas (3      9.2   -6.2  13.1  19.4  17.2  43.5
Rigid and                                       
Molded Fiber                                    
AOA (4           -0.2  -1.3  1.8   2.7   3.3   6.5
Other activities 0.0   0.3   0.5   -4.5  -0.1  -3.8
Total (5         20.0  -78.5 33.2  35.7  37.7  28.1

 
1) Q4 2007 includes goodwill impairment charges MEUR 8.3.
2) Q4 2007 includes restructuring charges MEUR 1.4, goodwill
impairment charges MEUR 31.6 and tangible asset impairment charges
MEUR 46.0.
3) Q4 2007 includes goodwill impairment charges MEUR 5.1 and tangible
asset impairment charges MEUR 11.8.
4)  Q4 2007 includes restructuring charges MEUR 2.3 and goodwill
impairment charges MEUR 1.6.
5) Q4 2007 includes restructuring charges MEUR 3.7, goodwill
impairment charges MEUR 46.6 and tangible asset impairment charges
MEUR 57.7, total amount MEUR 108.0.
 

Depreciation and amortization
                 Q1   Q4   Q3   Q2   Q1   Q1-Q4
EUR million      2008 2007 2007 2007 2007 2007
                                           
                                           
Flexibles and                              
Films Global     5.9  6.3  5.7  5.8  5.2  23.0
Rigid Europe     7.0  7.7  8.5  7.8  8.2  32.2
Molded Fiber                               
Europe           1.9  1.8  1.9  1.9  1.9  7.5
Rigid and Molded                           
Fiber Americas   5.0  5.6  5.8  5.9  6.0  23.3
Rigid and Molded                           
Fiber AOA        3.1  3.1  3.0  3.0  2.9  12.0
Other activities 0.2  0.2  0.2  0.2  0.3  0.9
Total            23.1 24.7 25.1 24.6 24.5 98.9

 

Net assets                              
allocated to                            
the segments (6                         
               Q1    Q4    Q3    Q2    Q1
EUR million    2008  2007  2007  2007  2007
                                        
                                        
Flexibles and                           
Films Global   526.7 542.9 547.7 528.0 513.9
Rigid Europe   399.9 407.6 494.0 502.9 494.4
Molded Fiber                            
Europe         121.5 119.1 118.7 116.4 116.1
Rigid and Molded                        
Fiber Americas 413.1 417.1 456.9 478.6 474.2
Rigid and Molded                        
Fiber AOA      188.0 201.3 204.5 209.3 197.1

 
6) Net assets include the following balance sheet items: intangible
and tangible assets, other non-current assets, inventories, trade and
other current receivables (excluding accrued interest income), other
non-current liabilities and trade and other current liabilities
(excluding accrued interest expense).
 

Capital                                    
expenditure                                
                 Q1   Q4   Q3   Q2   Q1   Q1-Q4
EUR million      2008 2007 2007 2007 2007 2007
                                           
                                           
Flexibles and                              
Films Global     6.8  15.3 15.1 12.6 8.6  51.6
Rigid Europe     2.2  9.8  8.6  7.9  9.5  35.8
Molded Fiber                               
Europe           0.6  7.3  0.8  0.8  0.8  9.7
Rigid and Molded                           
Fiber Americas   1.3  15.7 6.0  3.3  1.9  26.9
Rigid and                                  
Molded Fiber                               
 AOA             1.8  6.4  4.8  6.6  4.5  22.3
Other activities 0.7  0.9  0.1  0.3  0.3  1.6
Total            13.5 55.4 35.4 31.5 25.6 147.9

 

RONA, %
(12m roll.)                               
              Q1      Q4     Q3    Q2    Q1
              2008    2007   2007  2007  2007
                                          
Flexibles and                             
Films Global  5.7 %   7.2%   10.2% 11.1% 11.5%
Rigid Europe  -14.6 % -14.2% -1.3% -3.5% -2.8%
Molded Fiber                              
Europe        9.3 %   9.0%   8.9%  9.6%  10.2%
Rigid and                                 
Molded Fiber                              
Americas      8.0 %   9.5%   13.3% 13.5% 13.6%
Rigid and                                 
Molded Fiber                              
 AOA          1.5 %   3.2%   5.8%  6.6%  6.6%

 

Operating Cash Flow                                           
                    Q1      Q4      Q3       Q2      Q1      Q1-Q4
EUR million         2008    2007    2007     2007    2007    2007
                                                              
Flexibles and                                                 
Films Global        7.2     8.2     -16.9    8.5     -5.7    -5.9
Rigid Europe        1.1     17.3    16.9     -8.9    -6.9    18.4
Molded                                                        
Fiber Europe        1.6     5.2     1.4      4.0     1.4     12.0
Rigid and Molded                                              
Fiber Americas      -2.5    26.8    26.3     10.5    -3.3    60.3
Rigid and Molded                                              
Fiber AOA           3.8     0.6     2.0      -4.6    -5.7    -7.7
                                                              
As net sales and EBIT of reportable segments form Groups' total net
sales and EBIT, reconciliations to corresponding amounts are not
presented.

 
 

Other                            
information                      
                  Q1     Q1     Q1-Q4
EUR million       2008   2007   2007
                                 
Equity per                       
share (EUR)       7.13   8.64   7.70
ROE, %            -4.3   11.5   -2.4
ROI, %            0.8    9.3    1.8
Personnel         15,198 14,885 15,092
Result before                    
taxes (12m roll.) -31.3  108.7  -14.0
                                 
Depreciation      21.3   23.0   92.9
Amortization                     
of other                         
intangible assets 1.8    1.4    6.0

 
Share capital and shareholders
At the end of March 2008, the Company's registered share capital was
EUR 358,657,670.00 (unchanged) corresponding to a total number of
outstanding shares of 105,487,550 (unchanged) including 5,061,089
(unchanged) Company's own shares. The Company's own shares represent
4.8% of the total number of shares. The net figure of outstanding
shares was 100,426,461 (unchanged).
 
At the end of the reporting period there were 21,979 (22,033)
registered shareholders.
Foreign ownership including nominee registered shares accounted for
22.5% (25.9%).
 
Share developments
The Company's share is quoted on the OMX Nordic Exchange Helsinki on
the Nordic Mid Cap list under the Materials sector. At the end of
March 2008, the Company's market capitalization was EUR 715.2 million
(EUR 1,307.0 million) and EUR 680.9 million (EUR 1,244.3 million)
excluding Company's own shares. With a closing price of EUR 6.78 (EUR
12.39) the share price decreased by 17% (-17%) from the beginning of
the year, while the OMX Helsinki CAP PI Index decreased by 11% (+6%).
In January-March 2008, the volume weighted average price for the
Company's share was EUR 7.18 (EUR 13.30). The highest price paid was
EUR 8.36 on January 2, 2008 and the lowest price paid was EUR 6.22 on
March 17, 2008.
 
During the reporting period the cumulative value of the Company's
share turnover was EUR 280.2 million (EUR 426.9 million). The trading
volume of 39.1 million (32.1 million) shares equaled an average daily
turnover of EUR 4.5 million (EUR 6.7 million) or, correspondingly
631,175 (501,172) shares. In total, turnover of the Company's 2003 A,
B and C option rights was EUR 159,390, corresponding to a trading
volume of 114,051.
 

Contingent                            
 liabilities                          
                       Mar 31 Dec 31 Mar 31
                       2008   2007   2007
EUR million                           
                                      
                                      
Mortgages              14.5   14.5   14.6
Guarantee                             
obligations            2.1    2.8    6.2
Lease                                 
payments               52.9   55.6   59.1
Capital expenditure                   
commitments            34.9   19.4   48.5
                                      
Nominal values of                     
derivative instruments                
                       Mar 31 Dec 31 Mar 31
                       2008   2007   2007
EUR million                           
                                      
Currency forwards,                    
transaction                           
risk hedges            53     45     57
Currency forwards,                    
translation                           
risk hedges            64     101    111
Currency swaps,                       
financing hedges       144    143    130
Currency options       -      -1     -
Interest rate                         
swaps                  157    164    132
Electricity forwards   -      1      -

 
The following EUR rates have been applied to GBP, INR, AUD and USD
 

                          Q1/08 Q1/07
Income statement, GBP 1 = 1.320 1.491
average:          INR 1 = 0.017 0.017
                  AUD 1 = 0.605 0.600
                  USD 1 = 0.667 0.763
                                 
                          Q1/08 Q1/07
Balance sheet,    GBP 1 = 1.257 1.471
month end:        INR 1 = 0.016 0.017                  AUD 1 = 0.577 0.607
                  USD 1 = 0.632 0.751

 
Definitions for key indicators
 
Earnings per share = Result before taxes - minority interest - taxes
/ Average number of shares outstanding
 
Earnings per share (diluted) = Diluted result before taxes - minority
interest - taxes /
Average fully diluted number of shares outstanding
 
Net debt to equity (gearing) = Interest bearing net debt / Equity +
minority interest (average)
 
RONA, % = 100 x Earnings before interest and taxes (12 m roll.) / Net
assets (12 m roll.)
 
Operating cash flow = EBIT + depreciation and amortization (including
impairment) - capital expenditures + disposals +/- change in
inventories, trade receivables and trade payables.
 
Shareholders' equity per share = Equity / Issue-adjusted number of
shares at period end
 
Return on equity (ROE) = 100 x (Result for the period) / Equity +
minority interest (average)
 
Return on investment (ROI) = 100 x (Result before taxes + interest
expenses + net other financial expenses) / Balance sheet total -
Interest-free liabilities (average)

Attachments

Interim Report January 1 - March 31 2008 pdf