Vieremä, Finland, 2013-04-23 08:00 CEST (GLOBE NEWSWIRE) --
PONSSE PLC, STOCK EXCHANGE RELEASE, 23 APRIL 2013, 9:00 a.m.
PONSSE’S INTERIM REPORT FOR 1 JANUARY – 31 MARCH 2013
– Net sales amounted to EUR 61.6 (76.8) million.
– Operating result totalled EUR 0.1 (4.5) million, equalling 0.2 (5.9) per cent of net sales.
– Profit before taxes was EUR 0.7 (4.0) million.
– Cash flow from business operations was EUR 12.2 (-1.9) million.
– Earnings per share were EUR 0.00 (0.09).
– Equity ratio was 32.3 (47.1) per cent.
– Order books stood at EUR 49.1 (67.3) million.
PRESIDENT AND CEO JUHO NUMMELA:
The picking up of detached house construction in North America was visible in increased machine sales in the United States as well as Canada. The demand for new machines was close to normal in Russia as well. Sales of new machines in Russia, however, typically concentrate towards the end of the year. Of our main markets, Central Europe and Sweden in particular were soft during the period under review. Compared to other markets, the demand for new machines in Finland was at higher level, but remained approximately 25% lower than for the reference period.
Trade-in machine sales increased considerably during the period under review, which was mainly due to the picking up of the Finnish trade-in machine market. The net sales of maintenance services also increased as our customers’ work situation was mainly good in several of our markets. The demand for new machines remained low during the period, and quantitative sales fell 46% short of the reference period.
Due to the weak demand for new machines, adjustments had to be made to the factory capacity. The company’s order books continued to recover compared to the order books at the turn of the year, amounting to EUR 49.1 (67.3) million, or 27% less than for the reference period. The order books were not sufficient for operating in two shifts throughout the period under review. Early in the year, the factory operated in one shift and returned to two shifts in mid-February. The factory has been operating in one shift since the beginning of April.
Net sales for the period under review amounted to EUR 61.6 (76.8) million, representing a change of -19.7 per cent compared with the corresponding period. The operating result amounted to EUR 0.1 (4.5) million during the quarter. The result was burdened by considerably lower invoicing for forest machines compared with the reference period.
Cash flow from business operations amounted to EUR 12.2 (-1.9) million in the period under review. The stock of new products decreased to a level higher than normal when some of the invoicing for new machines was postponed to the second quarter. The stock of trade-in machines decreased, mainly due to good trade-in machine sales in Finland.
The hybrid loan, which has been included in the company’s equity on the balance sheet for four years, was paid back as planned at the end of the period under review. The repayment of the hybrid loan can be seen as lower equity and the company’s equity ratio consequently decreasing to 32.3 per cent.
Our investments in R&D continued normally. Maintenance services, sales and the subsidiary network also operated normally throughout the period under review.
NET SALES
Consolidated net sales for the period under review amounted to EUR 61.6 (76.8) million, which is 19.7 per cent less than in the comparison period. International business operations accounted for 60.1 (61.3) per cent of net sales.
Net sales were regionally distributed as follows: Northern Europe 52.2 (59.8) per cent, Central and Southern Europe 15.2 (15.7) per cent, Russia and Asia 13.9 (10.8) per cent, North and South America 18.7 (13.7) per cent and other countries 0.0 (0.0) per cent.
PROFIT PERFORMANCE
The operating result amounted to EUR 0.1 (4.5) million. The operating result equalled 0.2 (5.9) per cent of net sales for the period under review. Consolidated return on capital employed (ROCE) stood at 3.4 (15.0) per cent.
Staff costs for the period totalled EUR 12.6 (13.1) million. Other operating expenses stood at EUR 7.3 (8.2) million. The net total of financial income and expenses amounted to EUR 0.7 (-0.5) million. Exchange rate gains and losses with a net effect of EUR 1.0 (-0.1) million were recognised under financial items for the period. Profit for the period under review totalled EUR 0.5 (2.8) million. Diluted and undiluted earnings per share (EPS) came to EUR 0.00 (0.09). The interest on the subordinated loan for the period, less tax, has been taken into account in the calculation of EPS.
STATEMENT OF FINANCIAL POSITION AND FINANCING ACTIVITIES
At the end of the period under review, the total consolidated statements of financial position amounted to EUR 194.4 (174.2) million. Inventories stood at EUR 87.6 (87.6) million. Trade receivables totalled EUR 19.1 (26.8) million, while liquid assets stood at EUR 23.0 (9.8) million. Group shareholders’ equity stood at EUR 62.1 (81.7) million and parent company shareholders’ equity at EUR 81.9 (78.7) million. In the comparison period Group shareholders’ equity includes a hybrid loan of EUR 19 million issued on 31 March 2009 and settled on 28 March 2013. A separate release was issued on 19 February 2013 regarding the settlement of the hybrid loan. The interest paid on the hybrid loan totalling EUR 9.1 million, less tax, is recognised as a deduction from Group equity. The amount of interest-bearing liabilities was EUR 75.3 (38.1) million. The company has used 40 per cent of its credit facility limit. The parent company's net receivables from other Group companies stood at EUR 77.2 (78.4) million. The parent company’s receivables from subsidiaries mainly consisted of trade receivables. Consolidated net liabilities totalled EUR 52.3 (28.3) million, and the debt-equity ratio (gearing) was 121.2 (46.6) per cent. The equity ratio stood at 32.3 (47.1) percent at the end of the period under review.
Cash flow from business operations amounted to EUR 12.2 (-1.9) million. Cash flow from investment activities came to EUR -3.0 (-2.4) million.
ORDER INTAKE AND ORDER BOOKS
Order intake for the period totalled EUR 69.0 (73.3) million, while period-end order books were valued at EUR 49.1 (67.3) million.
DISTRIBUTION NETWORK
No changes took place in the Group structure during the period under review.
The subsidiaries included in the Ponsse Group are: Epec Oy, Finland; OOO Ponsse, Russia; Ponsse AB, Sweden; Ponsse AS, Norway; Ponsse Asia-Pacific Ltd, Hong Kong; Ponsse China Ltd, China; Ponsse Latin America Ltda, Brazil; Ponsse North America, Inc., the United States; Ponssé S.A.S., France; Ponsse UK Ltd, the United Kingdom; and Ponsse Uruguay S.A., Uruguay. Sunit Oy, based in Kajaani, Finland, is an affiliated company in which Ponsse Plc has a holding of 34 per cent.
CAPITAL EXPENDITURE AND R&D
During the period under review, the Group’s R&D expenses totalled EUR 2.4 (2.3) million, of which EUR 623 (479) thousand was capitalised.
Capital expenditure totalled EUR 3.0 (2.4) million. It consisted in addition to capitalised R&D expenses of investments in buildings and ordinary maintenance and replacement investments for machinery and equipment.
MANAGEMENT
The following persons were members of the Management Team: Juho Nummela, President and CEO, acting as the chairman; Pasi Arajärvi, Purchasing and Logistics Director; Juha Haverinen, Factory Director; Petri Härkönen, CFO; Juha Inberg, Technology and R&D Director; Tapio Mertanen, Service Director; Paula Oksman, HR Director and Jarmo Vidgrén, Deputy CEO, Sales and Marketing Director. The company management has regular management liability insurance.
The area director organisation of sales is lead by Jarmo Vidgrén, Group’s Sales and Marketing Director and Tapio Mertanen, Service Director. The geographical distribution and the responsible persons are presented below:
Northern Europe: Jarmo Vidgrén (Finland), Eero Lukkarinen (Sweden, Denmark) and Sigurd Skotte (Norway),
Central and Southern Europe: Janne Vidgrén (Austria, Poland, Romania, Germany, the Czech Republic and Hungary), Clément Puybaret (France), Jussi Hentunen (Spain, Italy, Portugal and Norrbotten/Sweden) and Gary Glendinning (the United Kingdom),
Russia and Asia: Jaakko Laurila (Russia, Belarus), Norbert Schalkx (Japan and the Baltic countries) and Risto Kääriäinen (China),
North and South America: Pekka Ruuskanen (the United States), Marko Mattila (North American dealers), Teemu Raitis (Brazil) and Martin Toledo (Uruguay).
PERSONNEL
The Group had an average staff of 979 (981) during the period and employed 986 (988) people at period-end.
SHARE PERFORMANCE
The company’s registered share capital consists of 28,000,000 shares. The trading volume of Ponsse Plc shares for 1 January – 31 March 2013 totalled 739,815, accounting for 2.6 per cent of the total number of shares. Share turnover amounted to EUR 4.7 million, with the period’s lowest and highest share prices amounting to EUR 5.99 and EUR 6.89, respectively.
At the end of the period, shares closed at EUR 6.36, and market capitalisation totalled EUR 178.1 million.
At the end of the period under review, the company held 212,900 treasury shares.
ANNUAL GENERAL MEETING
A separate release was issued on 16 April 2013 regarding the authorizations given to the Board of Directors and other resolutions at the AGM.
GOVERNANCE
In its decision-making and administration, the company observes the Finnish Limited Liability Companies Act, other regulations governing publicly listed companies and the company’s Articles of Association. The company’s Board of Directors has adopted the Code of Governance that complies with the Finnish Corporate Governance Code approved by the Board of the Securities Market Association in 2010. The purpose of the code is to ensure that the company is professionally managed and that its business principles and practices are of a high ethical and professional standard.
The Code of Governance is available on Ponsse’s website in the Investors section.
RISK MANAGEMENT
Risk management is based on the company’s values, as well as strategic and financial objectives. Risk management aims to support the achievement of the objectives specified in the company’s strategy, as well as to ensure the financial development of the company and the continuity of its business.
Furthermore, risk management aims to identify, assess and monitor business-related risks which may influence the achievement of the company’s strategic and financial goals or the continuity of its business. Decisions on the necessary measures to anticipate risks and react to observed risks are made on the basis of this information.
Risk management is a part of regular daily business, and it is also included in the management system. Risk management is controlled by the risk management policy approved by the Board.
A risk is any event that may prevent the company from reaching its objectives or that threatens the continuity of business. On the other hand, a risk may also be a positive event, in which case the risk is treated as an opportunity. Each risk is assessed on the basis of its impact and probability. Methods of risk management include avoiding, mitigating and transferring risks. Risks can also be managed by controlling and minimising their impact.
SHORT-TERM RISK MANAGEMENT
The prolonged insecurity in the world economy and weak economic situation may result in a decline in the demand for forest machines.
The rapid escalation of the problems in the economies of Europe and the United States in the financial market may have an impact on the availability of customer financing.
The parent company monitors the changes in the Group’s internal and external trade receivables and the associated risk of impairment.
The key objective of the company’s financial risk management policy is to manage liquidity, interest and currency risks. The company ensures its liquidity through credit limit facilities agreed with a number of financial institutions. The effect of adverse changes in interest rates is minimised by utilising credit linked to different reference rates and by concluding interest rate swaps. The effects of currency rate fluctuations are mitigated through derivative contracts.
Changes taking place in the fiscal and customs legislation in countries to which Ponsse exports may hamper the company’s export trade or its profitability.
OUTLOOK FOR THE FUTURE
The Group’s euro-denominated operating profit is expected to remain lower than in 2012.
Due to the low level of the order books, the adaptation of the factory’s capacity will be continued in the second quarter of the year, if necessary. Sales and maintenance functions will operate normally. We estimate that our customers’ work situation will remain good after the frost heaving period.
PONSSE GROUP
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (EUR 1,000)
| IFRS | IFRS | IFRS | |||
| 1-3/13 | 1-3/12 | 1-12/12 | |||
| NET SALES | 61,645 | 76,756 | 314,779 | ||
| Increase (+)/decrease (-) in inventories of finished goods and work in progress | 12,016 | 3,428 | -130 | ||
| Other operating income | 140 | 141 | 836 | ||
| Raw materials and services | -52,152 | -53,129 | -203,943 | ||
| Expenditure on employment-related benefits | -12,594 | -13,092 | -49,223 | ||
| Depreciation and amortisation | -1,648 | -1,369 | -5,862 | ||
| Other operating expenses | -7,315 | -8,203 | -31,986 | ||
| OPERATING RESULT | 93 | 4,531 | 24,471 | ||
| Share of results of associated companies | -84 | -44 | 11 | ||
| Financial income and expenses | 704 | -454 | -3,968 | ||
| RESULT BEFORE TAXES | 713 | 4,033 | 20,513 | ||
| Income taxes | -202 | -1,213 | -6,623 | ||
| NET RESULT FOR THE PERIOD | 512 | 2,820 | 13,890 | ||
| OTHER ITEMS INCLUDED IN TOTAL COMPREHENSIVE RESULT: | |||||
| Translation differences related to foreign units | -843 | 303 | 437 | ||
| TOTAL COMPREHENSIVE RESULT FOR THE PERIOD | -331 | 3,123 | 14,327 | ||
| Diluted and undiluted earnings per share* | 0.00 | 0.09 | 0.44 | ||
* The interest on the subordinated loan for the period, less tax, was taken into account in this figure.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION (EUR 1,000)
| IFRS | IFRS | IFRS | |
| ASSETS | 31 Mar 13 | 31 Mar 12 | 31 Dec 12 |
| NON-CURRENT ASSETS | |||
| Intangible assets | 12,137 | 9,529 | 11,898 |
| Goodwill | 3,440 | 3,440 | 3,440 |
| Property, plant and equipment | 36,675 | 26,737 | 35,525 |
| Financial assets | 111 | 111 | 111 |
| Investments in associated companies | 992 | 1,250 | 1,186 |
| Non-current receivables | 1,048 | 1,364 | 999 |
| Deferred tax assets | 2,022 | 2,257 | 1,628 |
| TOTAL NON-CURRENT ASSETS | 56,426 | 44,688 | 54,787 |
| CURRENT ASSETS | |||
| Inventories | 87,623 | 87,576 | 81,636 |
| Trade receivables | 19,148 | 26,814 | 25,954 |
| Income tax receivables | 897 | 679 | 1,959 |
| Other current receivables | 7,268 | 4,644 | 3,313 |
| Cash and cash equivalents | 23,029 | 9,762 | 14,083 |
| TOTAL CURRENT ASSETS | 137,966 | 129,476 | 126,944 |
| TOTAL ASSETS | 194,391 | 174,164 | 181,732 |
| SHAREHOLDERS’ EQUITY AND LIABILITIES | |||
| SHAREHOLDERS’ EQUITY | |||
| Share capital | 7,000 | 7,000 | 7,000 |
| Other reserves | 30 | 19,030 | 19,030 |
| Translation differences | -2,381 | -1,672 | -1,538 |
| Treasury shares | -2,228 | -2,228 | -2,228 |
| Retained earnings | 59,692 | 59,556 | 59,180 |
| EQUITY OWNED BY PARENT COMPANY SHAREHOLDERS | 62,113 | 81,686 | 81,444 |
| NON-CURRENT LIABILITIES | |||
| Interest-bearing liabilities | 41,471 | 18,623 | 21,474 |
| Deferred tax liabilities | 1,175 | 610 | 968 |
| Other non-current liabilities | 0 | 19 | 13 |
| TOTAL NON-CURRENT LIABILITIES | 42,646 | 19,252 | 22,455 |
| CURRENT LIABILITIES | |||
| Interest-bearing liabilities | 33,828 | 19,480 | 34,912 |
| Provisions | 4,763 | 4,947 | 4,977 |
| Tax liabilities for the period | 65 | 236 | 385 |
| Trade creditors and other current liabilities | 50,976 | 48,563 | 37,558 |
| TOTAL CURRENT LIABILITIES | 89,632 | 73,226 | 77,833 |
| TOTAL SHAREHOLDERS’ EQUITY AND LIABILITIES | 194,391 | 174,164 | 181,732 |
CONSOLIDATED STATEMENT OF CASH FLOWS (EUR 1,000)
| IFRS | IFRS | IFRS | ||
| 1-3/13 | 1-3/12 | 1-12/12 | ||
|
CASH FLOW FROM BUSINESS OPERATIONS: |
||||
| Net result for the period | 512 | 2,820 | 13,890 | |
| Adjustments: | ||||
| Financial income and expenses | -704 | 454 | 3,968 | |
| Share of the result of associated companies | 84 | 44 | -11 | |
| Depreciation and amortisation | 1,648 | 1,369 | 5,862 | |
| Income taxes | 202 | 1,284 | 6,623 | |
| Other adjustments | 546 | 557 | -452 | |
| Cash flow before changes in working capital | 2,286 | 6,528 | 29,880 | |
| Change in working capital: | ||||
| Change in trade receivables and other receivables | 2,238 | 1,611 | 4,256 | |
| Change in inventories | -5,987 | -7,101 | -1,161 | |
| Change in trade creditors and other liabilities | 13,580 | -1,360 | -8,600 | |
| Change in provisions for liabilities and charges | -214 | 320 | 350 | |
| Interest received | 57 | 32 | 195 | |
| Interest paid | -76 | -107 | -1,334 | |
| Other financial items | -421 | -251 | -1,561 | |
| Income taxes paid | 704 | -1,614 | -10,509 | |
| NET CASH FLOW FROM BUSINESS OPERATIONS (A) | 12,167 | -1,941 | 11,516 | |
| CASH FLOW FROM INVESTMENTS | ||||
| Investments in tangible and intangible assets | -3,036 | -2,412 | -18,062 | |
| Proceeds from sale of tangible and intangible assets | 0 | 0 | 62 | |
| CASH OUTFLOW FROM INVESTMENT ACTIVITIES (B) | --3,036 | -2,412 | -18,000 | |
| FINANCING | ||||
| Hybrid loan | -19,000 | 0 | 0 | |
| Interest paid, hybrid loan | -1,136 | -1,136 | -2,280 | |
| Withdrawal/Repayment of current loans | 472 | -1,105 | 14,478 | |
| Change in current interest-bearing liabilities | 213 | 34 | -100 | |
| Withdrawal of non-current loans | 20,000 | 768 | 10,000 | |
| Repayment of non-current loans | -342 | -760 | -8,184 | |
| Payment of finance lease liabilities | -1,650 | -16 | 1,029 | |
| Change in non-current receivables | -49 | 16 | 380 | |
| Dividends paid | 0 | 0 | -9,725 | |
| NET CASH OUTFLOW FROM FINANCING (C) | -1,492 | -2,200 | 5,598 | |
| Change in cash and cash equivalents (A+B+C) | 7,638 | -6,553 | -885 | |
| Cash and cash equivalents on 1 Jan | 14,083 | 16,267 | 16,267 | |
| Impact of exchange rate changes | 1,307 | 48 | -1,299 | |
| Cash and cash equivalents on 31 Mar / 31 Dec | 23,029 | 9,762 | 14,083 | |
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (EUR 1,000)
| A = Share capital | |||||||||||
| B = Share premium and other reserves | |||||||||||
| C = Translation differences | |||||||||||
| D = Treasury shares | |||||||||||
| E = Retained earnings | |||||||||||
| F = Total shareholders’ equity | |||||||||||
| EQUITY OWNED BY PARENT COMPANY SHAREHOLDERS | |||||||||||
| A | B | C | D | E | F | ||||||
| SHAREHOLDERS’ EQUITY 1 JAN 2013 | 7,000 | 19,030 | -1,538 | -2,228 | 59,180 | 81,444 | |||||
| Translation differences | -843 | -843 | |||||||||
| Result for the period | 512 | 512 | |||||||||
| Total comprehensive income for the period | -843 | 512 | -331 | ||||||||
| Other changes | -19,000 | -19,000 | |||||||||
| SHAREHOLDERS' EQUITY 31 MAR 2013 | 7,000 | 30 | -2,381 | -2,228 | 59,692 | 62,113 | |||||
| SHAREHOLDERS’ EQUITY 1 JAN 2012 | 7,000 | 19,030 | -1,975 | -2,228 | 56,736 | 78,563 | |||||
| Translation differences | 303 | 303 | |||||||||
| Result for the period | 2,820 | 2,820 | |||||||||
| Total comprehensive income for the period | 303 | 2,820 | 3,123 | ||||||||
| Other changes | 0 | ||||||||||
| SHAREHOLDERS' EQUITY 31 MAR 2012 | 7,000 | 19,030 | -1,672 | -2,228 | 59,556 | 81,686 | |||||
| * Consists of the interest paid, less tax, for the hybrid loan classified as equity. | |||||||||||
|
|
31 Mar 13 | 31 Mar 12 | 31 Dec 12 | ||
| 1. LEASING COMMITMENTS (EUR 1,000) | 2,441 | 3,734 | 2,898 | ||
| 2. CONTINGENT LIABILITIES (EUR 1,000) | 31 Mar 13 | 31 Mar 12 | 31 Dec 12 | ||
| Guarantees given on behalf of others | 1,570 | 1,527 | 1,601 | ||
| Repurchase commitments | 1,389 | 721 | 1,541 | ||
| Other commitments | 1,661 | 3,391 | 1,159 | ||
| TOTAL | 4,620 | 5,640 | 4,302 | ||
| 3. PROVISIONS (EUR 1,000) | Guarantee provision | ||||
| 1 January 2013 | 4,977 | ||||
| Provisions added | 173 | ||||
| Provisions cancelled | -388 | ||||
| 31 March 2013 | 4,763 | ||||
| KEY FIGURES AND RATIOS | 31 Mar 13 | 31 Mar 13 | 31 Dec 12 | ||
| R&D expenditure, MEUR | 2.4 | 2.3 | 9.5 | ||
| Capital expenditure, MEUR | 3.0 | 2.4 | 18.1 | ||
| as % of net sales | 4.9 | 3.1 | 5.7 | ||
| Average number of employees | 979 | 981 | 994 | ||
| Order books, MEUR | 49.1 | 67.3 | 41.8 | ||
| Equity ratio, % | 32.3 | 47.1 | 45.1 | ||
| Diluted and undiluted earnings per share (EUR) | 0.00 | 0.09 | 0.44 | ||
| Equity per share (EUR) | 2.22 | 2.92 | 2.91 | ||
FORMULAE FOR FINANCIAL INDICATORS
Return on capital employed, %:
Result before tax + financial expenses
--------------------------------------------
Shareholder´s equity + interest-bearing financial liabilities (average during the year) * 100
Average number of employees:
Average of the number of personnel at the end of each month. The calculation has been adjusted for part-time employees.
Gearing, %:
Interest-bearing financial liabilities
-----------------------------------------------
Shareholders’ equity * 100
Equity ratio, %:
Shareholders’ equity + Non-controlling interests
---------------------------------------------
Balance sheet total - advance payments received * 100
Earnings per share:
Net income for the period - Non-controlling interests - Interest on hybrid loan for the period less tax
----------------------------------------------
Average number of shares during the accounting period, adjusted for share issues
Equity per share:
Shareholders’ equity
----------------------------------------------
Number of shares on the balance sheet date, adjusted for share issues
| ORDER INTAKE, MEUR | 1-3/13 | 1-3/12 | 1-12/12 | ||
| Ponsse Group | 69.0 | 73.3 | 285.9 |
The interim report has been prepared observing the recognition and valuation principles of IFRS standards, but not all of the requirements of IAS 34 have been complied with. The same accounting principles were observed for the interim report as for the annual financial statements dated 31 December 2012.
The above figures have not been audited.
The above figures have been rounded and may therefore differ from those given in the official financial statements.
This communication includes future-oriented statements that are based on the assumptions currently made by the company’s management and its current decisions and plans. Although the management believes that the future expectations are well founded, there is no certainty that these expectations will prove to be correct. This is why the results may significantly deviate from the assumptions included in the future-oriented statements as a result of, among other things, changes in the economy, markets, competitive conditions, legislation or currency exchange rates.
Vieremä, 23 April 2013
PONSSE PLC
Juho Nummela
President and CEO
FURTHER INFORMATION
Juho Nummela, President and CEO, tel. +358 20 768 8914 or +358 400 495 690
Petri Härkönen, CFO, tel. +358 20 768 8608 or +358 50 409 8362
DISTRIBUTION
NASDAQ OMX Helsinki Ltd
Principal media
www.ponsse.com
Ponsse Plc is a company specialising in the sales, manufacture, servicing and technology of cut-to-length method forest machines and is driven by genuine interest in its customers and their business. Ponsse develops and manufactures sustainable and innovative harvesting solutions based on customers’ needs.
The company was established by forest machine entrepreneur Einari Vidgrén in 1970, and it has been a leader in timber harvesting solutions based on the cut-to-length method ever since. Ponsse is headquartered in Vieremä, Finland. The company’s shares are quoted on the NASDAQ OMX Nordic List.
