Cencorp Corporation Interim Report 15 August 2011 at 11.45 Finnish time
Cencorp Corporation’s Interim Report 1 January–30 June 2011
SUBSTANTIAL INCREASE IN NET SALES, OPERATING RESULT STILL IN THE RED
SUMMARY
April–June 2011
- The result and balance sheet of the Face (Telecom) business, i.e. the current Special Components segment, have been consolidated in all of Cencorp’s consolidated figures starting on 1 December 2010, which means that there are no comparison figures for this segment for the first half of 2010.
- The figures in brackets are comparison figures for the corresponding period in 2010.
- Cencorp Group’s net sales increased 192 percent to EUR 7.8 million (EUR 2.7 million) during the second quarter of the year.
- Operating result was EUR -1.4 million (EUR -1.1 million).
- The Laser and Automation Applications segment doubled its net sales to EUR 5.4 million (EUR 2.7 million) and substantially improved its operating profit, which nevertheless still remained slightly negative at EUR -0.1 million (EUR -1.1 million).
- The Special Components segment’s net sales were EUR 2.4 million, but its operating profit stood at EUR -1.3 million, mainly owing to a drop in the market share of its main customer.
- The Group’s result before taxes amounted to EUR -1.8 million (EUR -1.0 million).
- Earnings per share were EUR -0.01 (EUR -0.01).
January–June 2011
- Cencorp Group’s net sales increased 195 percent to EUR 13.5 million (EUR 4.6 million).
- The order book at the end of June stood at EUR 4.2 million (EUR 2.3 million).
- Operating result was EUR -3.7 million (EUR -2.0 million).
- Result before taxes amounted to EUR -4.8 million (EUR -1.8 million).
- Earnings per share were EUR -0.01 (EUR -0.01).
- The equity ratio at the end of June was 54.5 percent (6.5%).
Outlook for 2011 unchanged
- Cencorp expects net sales for 2011 to amount to approximately EUR 35–39 million, provided that no essential change takes place in the current economic landscape.
- The 12-month result from operations is expected to improve from 2010.
PRESIDENT AND CEO MATS ERIKSSON
“Our net sales almost tripled during the second quarter of the year. I am particularly satisfied with the sales of the former Cencorp, i.e. laser and automation applications, which doubled thanks to a good market situation and our own sales efforts. The Group’s net sales were also increased by the integration of the Face business, i.e. the special components manufacturing operations in China, into Cencorp.
In spite of the growth in net sales and the improvement in the result for the former Cencorp, the Group’s overall profitability declined markedly in April–June. The Special Components segment continued to face problems, particularly in product groups related to the mobile phone sector. The changes that are currently taking place in the competitive landscape for mobile phones have negatively affected the demand for our special components. The segment’s net sales development and profitability weakened, in particular, as a result of a drop in the market share of one of its major customers.
The Special Components segment does not show an acceptable level of growth and profitability, and we have stepped up the measures that were launched already during the first quarter. Among other things, we have started concentrating manufacturing on two plants instead of the previous three. We will weigh the opportunities for each of the segment’s product groups to achieve profitable growth and make our decisions during the next few weeks. There are particularly positive outlooks for the manufacture of new types of flexible circuits for new electronics applications and renewable energy applications, among others. I believe that these measures will put the segment’s net sales and profitability back on growth track.
In the Laser and Automation Applications segment, doubling net sales and reorganizing and streamlining operations clearly improved profitability, even though operating profit still remained slightly negative. Owing to the long delivery times for projects, the contracts concluded in the beginning of the year on new deliveries with better margins are expected to substantially improve the segment’s profitability during the remainder of the year.”
GENERAL
The comparison period is the corresponding period of the previous year, unless otherwise stated. When comparing the figures, it should be noted that the Face (Telecom) business is included in the year 2011 figures, but in the 2010 figures only as of December 2010.
The interim report has been drawn up in compliance with the IAS 34 Interim Financial Reporting standard and in compliance with the same accounting principles as in the financial statements. The interim report has not been audited.
More information on events that have taken place during the reporting period can be found in the stock exchange releases published on Cencorp’s website at www.cencorp.com. At the same address, you can also find the flagging notifications concerning changes in ownership according to the Securities Markets Act.
Cencorp is part of the Finnish Savcor Group. Savcor Group Oy owns 34.8 percent and Savcor Group Limited 39.0 percent of Cencorp.
SEGMENT-BASED REPORTING
The Face (Telecom) corporate transaction was completed on November 30, 2010, and Cencorp’s reporting structure was altered as of December 1, 2010. The Face (Telecom) business result and balance sheet were consolidated in Cencorp’s consolidated figures starting on December 1, 2010, and Cencorp’s reporting has been based on two business segments since 2010. The business segments are Laser and Automation Applications, and Special Components. The Laser and Automation Applications segment comprises Cencorp’s former business and the Special Components segment the business acquired through the Face transaction. This segment includes, among other things, interference shielding solutions for mobile phones, cameras, laptop computers and other electronic devices; antennas, flexible connectors and wires for mobile phones; various decorations, i.e. chemical and laser-based etchings of metal parts, and radio-frequency identification (RFID).
FINANCIAL DEVELOPMENT IN APRIL–JUNE
Net sales increased 192 percent to EUR 7.8 million (EUR 2.7 million). The increase in net sales was due to the growing demand for laser automation and other automation equipment and the integration of the Face (Telecom) business into Cencorp Group.
EBITDA were EUR -0.5 million (EUR -0.9 million). The Group’s depreciation has significantly increased since the integration of the Face (Telecom) business in China, i.e. the current Special Components segment, into Cencorp in December 2010.
The operating result was EUR -1.4 million (EUR -1.1 million). The Group’s operating result was particularly weighed down by the poor profitability of the Special Components segment. The Laser and Automation Applications segment’s operating profit markedly improved from the previous year, although it still remained negative.
The Group’s result before taxes amounted to EUR -1.8 million (EUR -1.0 million). The result for the reporting period was EUR -1.9 million (EUR -1.0 million).
Earnings per share were EUR -0.01 (-0.01) and diluted earnings per share EUR
-0.01 (-0.01).
FINANCIAL DEVELOPMENT IN JANUARY–JUNE 2011
Operating environment
Cencorp operates in industries applying electronics and energy technology. Its main geographical market areas are Europe, North America, South America and Asia. The global electronics industry, including the manufacture of mobile phones, is mostly concentrated in Asia, the domestic market area for the special components manufactured by Cencorp.
Demand for laser and automation applications continued to grow during the first half of the year. The risk of a slow-down in the growth of the world economy might affect investment decisions and thus the demand for laser and automation applications. However, rising labor costs, especially in China, will contribute to the increasing need for production process automation and thus demand for automation products on a longer term. Cencorp views the energy industry, and renewable energy applications in particular, as a new interesting market.
The seasonal character of the business generally slows down demand for special components during the first quarter of the year, but during the second quarter, demand nearly rose to its normal level again. The changes that are currently shaping the competitive landscape in the mobile phone markets and the operators’ market shares are making forecasting more difficult and will potentially alter the demand situation. However, depending on the development of the world economy, the outlook is positive, as market development goes hand in hand with the general economic development and the latest forecasts expect the mobile phone markets to grow nearly 10 percent during 2011. The growth outlook for other markets important for Cencorp, such as RFID transmitters and receivers and flexible circuits, is also positive.
Net sales and result
Net sales increased 195 percent to EUR 13.5 million (EUR 4.6 million). The increase in net sales was due to the integration of the Face (Telecom) business into Cencorp and growing demand for laser automation and other automation equipment.
EBITDA were EUR -1.9 million (EUR -1.6 million).
The operating result was EUR -3.7 million (EUR -2.0 million). The Group’s operating result was particularly weighed down by the poor profitability of the Special Components segment. The operating result of the Laser and Automation Applications segment improved from last year’s corresponding period.
The Group’s result before taxes amounted to EUR -4.8 million (EUR -1.8 million). The result for the reporting period was EUR -4.8 million (EUR -1.8 million).
Earnings per share were EUR -0.01 (-0.01) and diluted earnings per share EUR
-0.01 (-0.01).
Financing
Cash flow from business operations before investments was EUR -2.5 million (EUR -0.3 million). Trade receivables at the end of the reporting period were EUR 5.7 million (EUR 1.7 million). Net financial items amounted to EUR 1.0 (EUR 0.2 million of net financial income).
At the end of June, the equity ratio was EUR 54.5 (6.5) percent and equity per share was EUR 0.06 (EUR 0.005). At the end of the reporting period, the Group’s liquid assets totaled EUR 1.0 (0.4) million, and unused export credit limits, bank guarantee limits and factoring loans amounted to EUR 1.1 million (EUR 1.3 million).
In order to secure its delivery ability to meet the order book, Cencorp agreed, in the beginning of June, on a short-term loan of EUR one million with AC Finance BV, a subsidiary of Ahlström Capital Oy. AC Invest BV, another subsidiary of Ahlström Capital Oy, holds some 5.1% of Cencorp’s shares. The loan period started on 1 June 2011 and ends on 31 December 2011. Furthermore, the lender has the right to terminate the loan prematurely in situations defined in greater detail in the loan agreement, and Cencorp has the right to repay the loan in full at any time. The annual interest on the loan capital is 9.5%.
In addition, Savcor Group Oy, which holds 34.8% of Cencorp’s shares, and Cencorp agreed on extending the due date of a loan of some EUR 1.4 million, granted by Savcor Group Oy in 2009 to Cencorp and converted into a convertible bond on 25 May 2010, from the end of June 2011 to the end of 2011. The other loan terms and conditions remained unchanged. On the publishing date of the interim report, the loan amounts to approximately EUR 1.2 million.
Based on the above-mentioned measures and the improvement in the operational cash flow, the Board of Directors expects the financing resources available to the Company to be sufficient to meet the financing needs over the next 12 months.
Product development
The Group’s product development expenses in January–June were EUR 0.9 (0.3) million or 6.6 (6.5) percent of net sales.
Investments
Investments in January–June amounted to EUR 0.8 (0.4) million. The largest investments were EUR 0.4 million in machinery and equipment and EUR 0.3 million in development costs.
Segment information
Laser and Automation Applications
The Laser and Automation Applications segment’s net sales doubled to EUR 5.4 million (EUR 2.7 million) in April–June. The increase in net sales was due to the growing demand for laser automation and other automation equipment as a result of the upswing in the economic cycle as well as the boosting of internal sales efforts and the significant strengthening of the sales organization. In January–June, net sales increased 92 percent to EUR 8.8 million (EUR 4.6 million). The segment accounted for 65 percent of the Group’s net sales.
The segment’s EBITDA were EUR 0.2 million (EUR -0.9 million) in April–June and EUR -0.4 million (EUR -1.6 million) in January–June.
The operating result of the Laser and Automation Applications segment in April–June was EUR -0.1 (-1.1) million. In addition to the growth in net sales, profitability improved thanks to the reorganization and streamlining of operations. The segment’s operating result in January–June improved to EUR -1.0 (-2.0) million.
Special Components
The Face (Telecom) business’s, i.e. the current Special Components segment’s result and balance sheet have been consolidated in Cencorp’s consolidated figures as of 1 December 2010. Net sales of the Special Components segment were EUR 2.4 million in April–June and EUR 4.8 million in January–June. The segment accounted for 35 percent of the Group’s net sales.
The segment’s EBITDA were EUR -0.7 million in April–June and EUR -1.5 million in January–June.
Operating result was EUR -1.3 million in April–June and EUR -2.7 million in January–June. The segment’s net sales development and profitability during the second quarter of the year weakened, in particular, as a result of a drop in the market share of its main customer. The major changes that are currently taking place in the competitive landscape for mobile phones and the operators’ market shares have negatively affected the demand for Cencorp’s special components. Measures to boost the growth and profitability of the segment have been stepped up by, among other measures, concentrating manufacturing on two plants instead of the previous three. Decisions concerning the product range of the segment will be made during the next few weeks. The goal is to identify the product groups with potential for growth and profitability, and the manufacture of new types of flexible circuits for new electronics applications and renewable energy applications, for example, have emerged as areas with bright prospects.
PERSONNEL
During January–June, the Group employed an average of 350 (74) people, 63 of whom worked in Finland, 274 in China and 13 in other countries. During the reporting period, salaries and fees totaled EUR 3.3 (1.7) million.
SHARES AND SHAREHOLDERS
Cencorp’s share capital amounts to EUR 3,425,059.10 and the number of shares is 342,161,270 shares. The Company has one series of shares, which confer equal rights in the Company. Cencorp did not own any of its own shares at the end of the reporting period.
The Company had a total of 4,443 shareholders at the end of June, and 45.2 percent of the shares were under foreign ownership. The ten largest shareholders held 90.2 percent of the Company’s shares and voting rights on 30 June 2011.
Largest owners on 30 June 2011:
| Shares/voting rights | % | |
| 1. SAVCOR GROUP LIMITED | 133,333,333 | 39.0 |
| 2. SAVCOR GROUP OY | 119,235,078 | 34.8 |
| 3. AC INVEST BV | 17,499,999 | 5.1 |
| 4. ETERA MUTUAL PENSION INSURANCE COMPANY | 16,394,735 | 4.8 |
| 5. TILITOIMISTO CAPITAL OY | 11,249,900 | 3.3 |
| 6. PAASILA MATTI | 2,777,777 | 0.8 |
| 7. JOKELA MARKKU | 2,287,519 | 0.7 |
| 8. TIMMERBACKA HANNU | 2,222,222 | 0.6 |
| 9. TUOHI & PAALU OY | 2,050,000 | 0.6 |
| 10. FT CAPITAL OY | 1,707,140 | 0.5 |
| OTHERS | 33,403,567 | 9.8 |
| TOTAL | 342,161,270 | 100.0 |
The members of the Board of Directors and the President and CEO, either directly or through companies under their control, held a total of 255,346,188 shares in the Company on 30 June 2011, representing about 75 percent of the Company’s shares and voting rights. The Company’s President and CEO Mats Eriksson did not hold any shares in the Company at the end of June.
The price of Cencorp’s share varied between EUR 0.11 and 0.20 in January–June. The average price was EUR 0.14, and the closing price at the end of June EUR 0.12. A total of 10.1 million Cencorp shares were traded at a value of EUR 1.4 million in January–June. The Company’s market capitalization at the end of June stood at EUR 41.1 million.
No share options were granted to the Company’s management during the period 1 January–30 June 2011.
A total of 27,766,886 shares, ie. 84 percent of the total number of shares offered, were subscribed to in the rights issue carried out in February–March based on primary and secondary subscriptions. Through the rights issue, Cencorp raised a total of EUR 3,332,026 in new equity. This amount also includes the decrease in the Company’s liabilities by a total of EUR 2,333,945 as Savcor Group Oy offset the subscription price of the shares it subscribed to in the rights issue against its capital and interest receivables from the Company related to interest-bearing loans. The subscription price, EUR 3,332,026, was recognized in full in the Company’s distributable non-restricted equity fund.
RISK MANAGEMENT, RISKS AND UNCERTAINTIES
Cencorp’s Board of Directors is responsible for the appropriate control of the Company’s accounts and finances. The Board is responsible for internal control, while the President and CEO handles the practical arrangement and monitors the efficiency of internal control. Business management and control are taken care of using a Group-wide reporting and forecasting system.
The purpose of risk management is to ensure that any significant business risks are identified and monitored appropriately. The Company’s business and financial risks are managed centrally by the Group’s financial department, and reports on risks are presented to the Board of Directors as necessary.
Due to the small size of the Company and the limited scope of its business operations, Cencorp does not have an internal auditing organization or an audit committee.
As it is difficult to make forecasts in an industry that is dependent on economic cycles, the biggest risks are related to fluctuations in the demand for products and to the adjustment of operations to meet demand.
In terms of profitability, the most essential risks are related to the achievement of a sufficient invoicing volume in both business segments and the success achieved with the programs underway at Cencorp to improve profitability, such as improvements in productivity and business flexibility through outsourcing production.
In terms of operations, the biggest risks are related to outsourcing in-house equipment production to contract manufacturers, in particular to whether the production chain efficiency targets are achieved as planned.
The sufficiency of the company’s financing and working capital involve risks that are handled in more detail in the item Financing of this interim report.
Other risks connected to Cencorp have been presented in more detail in the Annual Report for 2010 and in the base prospectus and its securities notes published on 25 October 2010.
EVENTS AFTER THE REPORTING PERIOD
The prosecutions that have come to Cencorp’s knowledge
According to the information received by Cencorp in July, the District Prosecutor has decided to prosecute some of the Company’s former employees, CEO and Board Members for a securities markets information offence and/or insider trading. The prosecution for the suspected securities markets information offence concerns the period of time from August 2005 to August 2006. All of the suspected persons have denied the criminal allegations made against them. The suspected persons are not currently employed by Cencorp or members in its administrative bodies.
Cencorp is not an involved party in the matter. According to the understanding of Cencorp’s Board of Directors, the above-mentioned prosecutions do not have substantial impact on the financial position of Cencorp or on the Company’s operatios.
OUTLOOK FOR 2011
Cencorp’s market prospects remain unchanged, as follows: Cencorp expects net sales for 2011 to amount to approximately EUR 35–39 million, provided that no essential change takes place in the current economic landscape. The 12-month result from operations is expected to improve from 2010.
In spite of the problems caused by the Special Components segment during the early part of the year, net sales and profitability are expected to develop favorably during the remainder of the year. Measures have been started in the Special Components segment to set up a more profitable product range and to boost operations, and the profitability of the Laser and Automation Applications segment will improve as the year goes on as projects with better margins will be recognized as revenues during the latter half of the year. The possible slow-down in the world economy will, however, bring uncertainties and could potentially reduce demand in markets that are important to the Company.
Cencorp’s order book at the end of June stood at around EUR 4.2 million (EUR 2.3 million) and at around EUR 2.9 million on the publishing date of this interim report.
Cencorp’s goal is to grow through acquisitions and mergers based on strategic choices, new products and new customer relationships, and by licensing products and technologies to complement the Company’s own offering.
Alongside the electronics industry, Cencorp will actively target new emerging markets, such as energy production and energy supply applications for mobile equipment. In these selected areas, the Company seeks a leading position as a supplier of special technology in the long term.
In Mikkeli, on 15 August 2011
Cencorp Corporation
BOARD OF DIRECTORS
| Statement of Consolidated Comprehensive Income | ||||||||||||||||||||||||||||
| (unaudited) | ||||||||||||||||||||||||||||
| 1 000 EUR | 4-6/2011 | 4-6/2010 | 1-6/2011 | 1-6/2010 | 1-12/2010 | |||||||||||||||||||||||
| Net sales | 7 809 | 2 672 | 13 540 | 4 584 | 12 811 | |||||||||||||||||||||||
| Cost of sales | -7 149 | -2 214 | -13 396 | -3 896 | -10 349 | |||||||||||||||||||||||
| Gross profit | 660 | 457 | 143 | 687 | 2 461 | |||||||||||||||||||||||
| Other operating income | 41 | 15 | 91 | 43 | 278 | |||||||||||||||||||||||
| Product development expenses | -475 | -81 | -935 | -319 | -761 | |||||||||||||||||||||||
| Sales and marketing expenses | -581 | -482 | -1 080 | -912 | -2 031 | |||||||||||||||||||||||
| Administrative expenses | -1 088 | -1 007 | -1 948 | -1 513 | -3 000 | |||||||||||||||||||||||
| Other operating expenses | -4 | -9 | -6 | -17 | -76 | |||||||||||||||||||||||
| Operating profit | -1 448 | -1 107 | -3 735 | -2 031 | -3 128 | |||||||||||||||||||||||
| Financial income | 476 | 200 | 800 | 389 | 605 | |||||||||||||||||||||||
| Financial expenses | -839 | -131 | -1 829 | -196 | -973 | |||||||||||||||||||||||
| Profit before taxes | -1 811 | -1 038 | -4 764 | -1 838 | -3 496 | |||||||||||||||||||||||
| Income taxes | -43 | 8 | -49 | 17 | 12 | |||||||||||||||||||||||
| Profit/loss for the period | -1 854 | -1 029 | -4 813 | -1 822 | -3 484 | |||||||||||||||||||||||
| Profit/loss attributable to: | ||||||||||||||||||||||||||||
| Shareholders of the parent company | -1 854 | -1 029 | -4 813 | -1 822 | -3 484 | |||||||||||||||||||||||
| Earnings/share (basic), eur | -0,01 | -0,01 | -0,01 | -0,01 | -0,02 | |||||||||||||||||||||||
| Earnings/share (diluted), eur | -0,01 | -0,01 | -0,01 | -0,01 | -0,02 | |||||||||||||||||||||||
| Other comprehensive income | ||||||||||||||||||||||||||||
| Translation difference | -4 | -113 | -583 | -235 | -320 | |||||||||||||||||||||||
| Other comprehensive income | 0 | 0 | 0 | 0 | 0 | |||||||||||||||||||||||
| Total comprehensive income for the year | -1 858 | -1 142 | -5 396 | -2 056 | -3 805 | |||||||||||||||||||||||
| Total comprehensive income attributable to: | ||||||||||||||||||||||||||||
| Shareholders of the parent company | -1 858 | -1 142 | -5 396 | -2 056 | -3 805 | |||||||||||||||||||||||
| Consolidated Balance Sheet | ||||||||||||||||||||||||||||
| (unaudited) | ||||||||||||||||||||||||||||
| 1 000 EUR | 30.6.2011 | 30.6.2010 | 31.12.2010 | |||||||||||||||||||||||||
| ASSETS | ||||||||||||||||||||||||||||
| Non-current assets | ||||||||||||||||||||||||||||
| Property, plant and equipment | 15 558 | 584 | 17 332 | |||||||||||||||||||||||||
| Goodwill | 2 967 | 2 967 | 2 967 | |||||||||||||||||||||||||
| Other intangible assets | 3 271 | 1 123 | 3 537 | |||||||||||||||||||||||||
| Available-for-sale investment | 10 | 10 | 10 | |||||||||||||||||||||||||
| Total non-current assets | 21 806 | 4 683 | 23 845 | |||||||||||||||||||||||||
| Current assets | ||||||||||||||||||||||||||||
| Inventories | 4 854 | 2 173 | 4 940 | |||||||||||||||||||||||||
| Trade and other non-interest-bearing receivables | 7 589 | 2 967 | 10 406 | |||||||||||||||||||||||||
| Cash and cash equivalents | 1 010 | 409 | 1 647 | |||||||||||||||||||||||||
| Total current assets | 13 453 | 5 549 | 16 994 | |||||||||||||||||||||||||
| Total assets | 35 258 | 10 232 | 40 839 | |||||||||||||||||||||||||
| EQUITY AND LIABILITIES | ||||||||||||||||||||||||||||
| Equity attributable to shareholders of the parent company | ||||||||||||||||||||||||||||
| Share capital | 3 425 | 3 425 | 3 425 | |||||||||||||||||||||||||
| Other reserves | 43 344 | 18 432 | 40 012 | |||||||||||||||||||||||||
| Translation difference | -793 | -125 | -210 | |||||||||||||||||||||||||
| Retained earnings | -27 031 | -21 088 | -22 082 | |||||||||||||||||||||||||
| Total equity | 18 944 | 645 | 21 145 | |||||||||||||||||||||||||
| Non-current liabilities | ||||||||||||||||||||||||||||
| Non-current loans | 2 676 | 2 949 | 4 534 | |||||||||||||||||||||||||
| Deferred tax liabilities | 62 | 92 | 70 | |||||||||||||||||||||||||
| Total non-current liabilities | 2 738 | 3 040 | 4 604 | |||||||||||||||||||||||||
| Current liabilities | ||||||||||||||||||||||||||||
| Current interest-bearing liabilities | 6 017 | 2 730 | 5 905 | |||||||||||||||||||||||||
| Trande and other payables | 7 445 | 3 750 | 9 136 | |||||||||||||||||||||||||
| Current provisions | 114 | 67 | 49 | |||||||||||||||||||||||||
| Total current liabilities | 13 576 | 6 547 | 15 090 | |||||||||||||||||||||||||
| Total liabilities | 16 314 | 9 588 | 19 694 | |||||||||||||||||||||||||
| Equity and liabilities total | 35 258 | 10 232 | 40 839 | |||||||||||||||||||||||||
| Consolidated Cash Flow Statement | ||||||||||||||||||||||||||||
| (unaudited) | ||||||||||||||||||||||||||||
| 1 000 EUR | 1-6/2011 | 1-6/2010 | 1-12/2010 | |||||||||||||||||||||||||
| Cash flow from operating activities | ||||||||||||||||||||||||||||
| Income statement profit/loss | -4 813 | -1 822 | -3 484 | |||||||||||||||||||||||||
| Non-monetary items adjusted on income statement | ||||||||||||||||||||||||||||
| Depreciation and impairment | + | 1 825 | 384 | 1 085 | ||||||||||||||||||||||||
| Gains/losses on disposals of non-current assets | +/- | 0 | -4 | 24 | ||||||||||||||||||||||||
| Unrealized exchange rate gains (-) and losses (+) | +/- | 552 | -323 | 104 | ||||||||||||||||||||||||
| Other non-cash transactions | +/- | 0 | 19 | 22 | ||||||||||||||||||||||||
| Financial income and expense | + | 477 | 130 | 264 | ||||||||||||||||||||||||
| Interest gains | - | 0 | 0 | 0 | ||||||||||||||||||||||||
| Taxes | - | 49 | -17 | -12 | ||||||||||||||||||||||||
| Total cash flow before change in working capital | -1 910 | -1 632 | -1 998 | |||||||||||||||||||||||||
| Change in working capital | ||||||||||||||||||||||||||||
| Increase (-) / decrease (+) in inventories | -99 | 457 | 387 | |||||||||||||||||||||||||
| Increase (-) / decrease (+) in trade and other receivables | 1 048 | -240 | -95 | |||||||||||||||||||||||||
| Increase (+) / decrease (-) in trade and other payables | -941 | 1 164 | 121 | |||||||||||||||||||||||||
| Change in working capital | 8 | 1 381 | 413 | |||||||||||||||||||||||||
| Adjustment of financial items and taxes to cash-based accounting | ||||||||||||||||||||||||||||
| Interest paid | - | -244 | -16 | -314 | ||||||||||||||||||||||||
| Interest received | + | 2 | 0 | 47 | ||||||||||||||||||||||||
| Other financial items | - | -182 | -44 | 15 | ||||||||||||||||||||||||
| Taxes paid | - | -126 | 0 | 0 | ||||||||||||||||||||||||
| Financial items and taxes | -550 | -60 | -252 | |||||||||||||||||||||||||
| NET CASH FLOW FROM BUSINESS OPERATIONS | -2 452 | -311 | -1 837 | |||||||||||||||||||||||||
| CASH FLOW FROM INVESTING ACTIVITIES | ||||||||||||||||||||||||||||
| Investments in tangible and intangible assets | - | -1 083 | -380 | -1 201 | ||||||||||||||||||||||||
| Proceeds on disposal of tangible and intangible assets | + | 0 | 16 | 10 | ||||||||||||||||||||||||
| Repayment of loan receivables | + | 1 468 | 376 | 1 042 | ||||||||||||||||||||||||
| Acquisition of subsidiaries and other business units | - | 0 | 0 | -2 504 | ||||||||||||||||||||||||
| Disposal of subsidiaries and other business units | + | 0 | 0 | 0 | ||||||||||||||||||||||||
| NET CASH FLOW FROM INVESTMENTS | 385 | 12 | -2 653 | |||||||||||||||||||||||||
| CASH FLOW FROM FINANCING ACTIVITIES | ||||||||||||||||||||||||||||
| Proceeds from share issue | + | 903 | 0 | 5 268 | ||||||||||||||||||||||||
| Proceeds from non-current borrowings | + | 0 | 0 | 0 | ||||||||||||||||||||||||
| Repayment of non-current borrowings | - | 0 | 0 | 0 | ||||||||||||||||||||||||
| Proceeds from current borrowings | + | 5 534 | 6 365 | 14 052 | ||||||||||||||||||||||||
| Repayment of current borrowings | - | -4 936 | -5 712 | -13 289 | ||||||||||||||||||||||||
| Dividends paid | - | -4 | 0 | 0 | ||||||||||||||||||||||||
| NET CASH FLOW FROM FINANCING ACTIVITIES | 1 497 | 653 | 6 030 | |||||||||||||||||||||||||
| INCREASE (+) OR DECREASE (-) IN CASH FLOW | -570 | 354 | 1 540 | |||||||||||||||||||||||||
| Statement of Changes in Equity | ||||||||||||||||||||||||||||
| (unaudited) | ||||||||||||||||||||||||||||
| 1 000 EUR | Share capital | Other reserves | Translation difference | Distribu-table non-restricted equity fund | Retained earnings | Total | ||||||||||||||||||||||
| 31.12.2010 | 3 425 | 4 908 | -210 | 35 104 | -22 082 | 21 145 | ||||||||||||||||||||||
| Directed issue | 3 332 | 3 332 | ||||||||||||||||||||||||||
| Decrease from share issue | -136 | -136 | ||||||||||||||||||||||||||
| Translation difference, comprehensive income | -583 | -583 | ||||||||||||||||||||||||||
| Profit/loss for the period | -4 813 | -4 813 | ||||||||||||||||||||||||||
| 30.6.2011 | 3 425 | 4 908 | -793 | 38 436 | -27 031 | 18 944 | ||||||||||||||||||||||
| 1 000 EUR | Share capital | Other reserves | Translation difference | Distribu-table non-restricted equity fund | Retained earnings | Total | ||||||||||||||||||||||
| 31.12.2009 | 3 425 | 4 908 | 110 | 13 524 | -19 266 | 2 701 | ||||||||||||||||||||||
| Directed issue | 0 | |||||||||||||||||||||||||||
| Translation difference, comprehensive income | -235 | -235 | ||||||||||||||||||||||||||
| Profit/loss for the period | -1 822 | -1 822 | ||||||||||||||||||||||||||
| 30.6.2010 | 3 425 | 4 908 | -125 | 13 524 | -21 088 | 645 | ||||||||||||||||||||||
| Segment information | ||||||||||||||||||||||||||||
| (unaudited) | ||||||||||||||||||||||||||||
| Face (Telecom) corporate transaction was completed on 30.11.2010, and Cencorp’s reporting structure was altered. Cencorp’s reporting for 2011 is based on two business segments. The business segments are Laser and Automation Applications, and Special Components. In 2010 Special Components business segment was consolidated in Cencorp's consolidated figures starting on 1 December 2010. | ||||||||||||||||||||||||||||
| 1 000 EUR | 1-6/2011 | 1-6/2010 | 1-12/2010 | |||||||||||||||||||||||||
| Net sales | ||||||||||||||||||||||||||||
| Laser and Automation Applications | 8 765 | 4 584 | 11 089 | |||||||||||||||||||||||||
| Special Components | 4 835 | 0 | 1 733 | |||||||||||||||||||||||||
| Eliminations | -61 | 0 | -12 | |||||||||||||||||||||||||
| Total | 13 540 | 4 584 | 12 811 | |||||||||||||||||||||||||
| Operating profit | ||||||||||||||||||||||||||||
| Laser and Automation Applications | -1 021 | -2 031 | -2 305 | |||||||||||||||||||||||||
| Special Components | -2 691 | 0 | -16 | |||||||||||||||||||||||||
| Eliminations | -24 | 0 | -807 | |||||||||||||||||||||||||
| Total | -3 735 | -2 031 | -3 128 | |||||||||||||||||||||||||
| EBITDA | ||||||||||||||||||||||||||||
| Laser and Automation Applications | -420 | -1 647 | -1 445 | |||||||||||||||||||||||||
| Special Components | -1 466 | 0 | 209 | |||||||||||||||||||||||||
| Eliminations | -24 | 0 | -807 | |||||||||||||||||||||||||
| Total | -1 910 | -1 647 | -2 043 | |||||||||||||||||||||||||
| Profit/loss for the period | ||||||||||||||||||||||||||||
| Laser and Automation Applications | -1 561 | -1 822 | -2 888 | |||||||||||||||||||||||||
| Special Components | -3 359 | 0 | -367 | |||||||||||||||||||||||||
| Eliminations | 108 | 0 | -229 | |||||||||||||||||||||||||
| Total | -4 813 | -1 822 | -3 484 | |||||||||||||||||||||||||
| Assets | ||||||||||||||||||||||||||||
| Laser and Automation Applications | 31 352 | 10 232 | 31 678 | |||||||||||||||||||||||||
| Special Components | 23 609 | 0 | 28 712 | |||||||||||||||||||||||||
| Eliminations | -19 702 | 0 | -19 551 | |||||||||||||||||||||||||
| Total | 35 258 | 10 232 | 40 839 | |||||||||||||||||||||||||
| Liabilities | ||||||||||||||||||||||||||||
| Laser and Automation Applications | 10 110 | 9 588 | 10 379 | |||||||||||||||||||||||||
| Special Components | 13 160 | 0 | 14 161 | |||||||||||||||||||||||||
| Eliminations | -6 956 | 0 | -4 845 | |||||||||||||||||||||||||
| Total | 16 314 | 9 588 | 19 694 | |||||||||||||||||||||||||
| Investments | ||||||||||||||||||||||||||||
| Laser and Automation Applications | 444 | 380 | 1 674 | |||||||||||||||||||||||||
| Special Components | 372 | 0 | 259 | |||||||||||||||||||||||||
| Eliminations | 0 | 0 | -127 | |||||||||||||||||||||||||
| Total | 816 | 380 | 1 806 | |||||||||||||||||||||||||
| Depreciation | ||||||||||||||||||||||||||||
| Laser and Automation Applications | 601 | 384 | 799 | |||||||||||||||||||||||||
| Special Components | 1 225 | 0 | 226 | |||||||||||||||||||||||||
| Eliminations | 0 | 0 | 0 | |||||||||||||||||||||||||
| Total | 1 825 | 384 | 1 024 | |||||||||||||||||||||||||
| Impairment | ||||||||||||||||||||||||||||
| Laser and Automation Applications | 0 | 0 | 61 | |||||||||||||||||||||||||
| Special Components | 0 | 0 | 0 | |||||||||||||||||||||||||
| Eliminations | 0 | 0 | 0 | |||||||||||||||||||||||||
| Total | 0 | 0 | 61 | |||||||||||||||||||||||||
| Key Figures | |||||
| (unaudited) | |||||
| 1 000 EUR | 4-6/2011 | 4-6/2010 | 1-6/2011 | 1-6/2010 | 1-12/2010 |
| Net sales | 7 809 | 2 672 | 13 540 | 4 584 | 12 811 |
| Operating profit | -1 448 | -1 107 | -3 735 | -2 031 | -3 128 |
| % of net sales | -18,5 | -41,4 | -27,6 | -44,3 | -24,4 |
| EBITDA | -543 | -914 | -1 910 | -1 647 | -2 043 |
| % of net sales | -7,0 | -34,2 | -14,1 | -35,9 | -15,9 |
| Profit before taxes | -1 811 | -1 038 | -4 764 | -1 838 | -3 496 |
| % of net sales | -23,2 | -38,8 | -35,2 | -40,1 | -27,3 |
| Balance Sheet value | 35 258 | 10 232 | 35 258 | 10 232 | 40 839 |
| Equity ratio, % | 53,7 | 6,3 | 53,7 | 6,3 | 51,8 |
| Net gearing, % | 40,6 | 714,3 | 40,6 | 714,3 | 41,6 |
| Gross investments | 320 | 280 | 816 | 380 | 1 806 |
| % of net sales | 4,1 | 10,5 | 6,0 | 8,3 | 14,1 |
| Research and development costs | 475 | 81 | 935 | 319 | 761 |
| % of net sales | 6,1 | 3,0 | 6,9 | 7,0 | 5,9 |
| Order book | 4 228 | 2 348 | 4 228 | 2 348 | 6 013 |
| Personnel on average | 345 | 71 | 350 | 74 | 98 |
| Personnel at the end of the period | 343 | 70 | 343 | 70 | 371 |
| Non-interest-bearing liabilities | 7 445 | 3 750 | 7 445 | 3 750 | 9 136 |
| Interest-bearing liabilities | 8 693 | 5 678 | 8 693 | 5 678 | 10 440 |
| Share key indicators | |||||
| Earnings/share (basic) | -0,01 | -0,01 | -0,01 | -0,01 | -0,02 |
| Earnings/share (diluted) | -0,01 | -0,01 | -0,01 | -0,01 | -0,02 |
| Equity/share | 0,06 | 0,005 | 0,06 | 0,00 | 0,07 |
| Highest price | 0,14 | 0,19 | 0,20 | 0,19 | 0,19 |
| Lowest price | 0,11 | 0,13 | 0,11 | 0,13 | 0,10 |
| Average price | 0,12 | 0,16 | 0,14 | 0,16 | 0,14 |
| Closing price | 0,12 | 0,14 | 0,12 | 0,14 | 0,15 |
| Market capitalisation, at the end of the period, MEUR | 41,1 | 18,8 | 41,1 | 18,8 | 47,2 |
| Calculation of Key Figures | |||||
| EBITDA, % | Operating profit for the period + depreciation + | ||||
| impairment | |||||
| Net sales for the period | |||||
| Equity ratio, %: | Total equity x 100 | ||||
| Total assets - advances received | |||||
| Net gearing, %: | Interest-bearing liabilities - cash and cash equivalents | ||||
| and marketable securities x 100 | |||||
| Shareholders' equity + minority interest | |||||
| Earnings/share (EPS): | Profit/loss for the period to the owner | ||||
| of the parent company | |||||
| Average number of shares adjusted for share issue | |||||
| at the end of the financial year | |||||
| Equity/share: | Equity attributable to shareholders of the parent company | ||||
| Undiluted number of shares on the balance sheet date | |||||
| Commitments and contingent liabilities | |||
| (unaudited) | |||
| 1 000 EUR | 30.6.2011 | 30.6.2010 | 31.12.2010 |
| Loans from financial institutions | 5 264 | 967 | 5 424 |
| Promissory notes secured by pledge | 12 691 | 12 691 | 12 691 |
| Mortgages on real estate | 4 727 | 0 | 5 006 |
| Deposits | 535 | 0 | 567 |
| Factoring loan, export credit limit and bank guarantee facility | 998 | 1 169 | 1 355 |
| Trade receivables | 996 | 1 320 | 1 720 |
| Promissory notes secured by pledge | 12 691 | 12 691 | 12 691 |
| Operating leases | |||
| Payable within one year | 11 | 43 | 28 |
| Payable over one year | 3 | 14 | 5 |
| Commitments | |||
| Payable within one year | 750 | 246 | 783 |
| Payable over one year | 4 562 | 1 057 | 5 071 |
For more information:
President and CEO Mats Eriksson, tel. +358 400 358 982
Cencorp’s interim report for January–September 2011 will be published on 7 November 2011.