Iisalmi, 2015-10-29 08:00 CET (GLOBE NEWSWIRE) -- OLVI PLC INTERIM REPORT 29 OCTOBER 2015 at 9:00 am
OLVI GROUP’S INTERIM REPORT, 1 JANUARY TO 30 SEPTEMBER 2015 (9 MONTHS)
INTERIM REPORT IN BRIEF
Olvi Group’s third-quarter earnings fell short of the previous year mostly due to substantial depreciation in the Belarusian exchange rate as well as a dip in consumer demand due to cool and rainy weather in the midsummer season.
January to September 2015 in brief:
- Olvi Group’s sales volume was 452.1 (449.3) million litres
- The Group’s net sales amounted to 241.7 (254.4) million euro
- The Group’s operating profit amounted to 31.8 (36.5) million euro
- Olvi Group’s earnings per share stood at 0.83 (1.39) euro per share
- The equity to total assets ratio was 56.1 (57.6) percent.
July to September 2015 in brief:
- Olvi Group’s sales volume was 168.0 (170.4) million litres
- The Group’s net sales amounted to 88.9 (97.8) million euro
- The Group’s operating profit amounted to 14.1 (17.2) million euro
- Olvi Group’s earnings per share stood at 0.37 (0.73) euro per share. The decline in earnings per share was affected by unrealised exchange rate differences related to the Belarusian subsidiary, which were recognised in financial items.
Olvi specifies its near-term outlook and estimates that the Group’s sales volume for 2015 will increase slightly on the previous year. Net sales and operating profit are estimated to fall slightly short of 2014. The Group had previously disclosed the following outlook: Olvi estimates that the Group’s sales volume for 2015 will increase slightly on the previous year. Net sales and operating profit are estimated to be on a par with 2014 or slightly lower.
CONSOLIDATED KEY RATIOS
| 7-9/ 2015 | 7-9/ 2014 |
Change % / pp |
1-9/ 2015 | 1-9/ 2014 |
Change % / pp |
1-12/ 2014 | |
| Sales volume, Mltr | 168.0 | 170.4 | -1.4 | 452.1 | 449.3 | 0.6 | 576.5 |
| Net sales, MEUR | 88.9 | 97.8 | -9.1 | 241.7 | 254.4 | -5.0 | 320.8 |
| EBITDA, MEUR | 18.3 | 21.3 | -14.1 | 44.0 | 47.7 | -7.8 | 55.9 |
| Operating profit, MEUR | 14.1 | 17.2 | -17.7 | 31.8 | 36.5 | -12.8 | 41.0 |
| % of net sales | 15.9 | 17.5 | 13.2 | 14.3 | 12.8 | ||
| Net profit for the period | 7.6 | 15.5 | -51.0 | 17.2 | 29.4 | -41.6 | 33.1 |
| % of net sales | 8.6 | 15.9 | 7.1 | 11.6 | 10.3 | ||
| Earnings per share, EUR | 0.37 | 0.73 | -49.3 | 0.83 | 1.39 | -40.3 | 1.57 |
| Gross capital expenditure, MEUR | 5.1 | 8.5 | -39.8 | 21.1 | 31.9 | -33.8 | 41.6 |
| Equity per share, EUR | 8.73 | 9.07 | -3.7 | 9.17 | |||
| Equity to total assets, % | 56.1 | 57.6 | -1.5 | 57.9 | |||
| Gearing, % | 31.7 | 28.0 | 3.7 | 29.8 |
BUSINESS DEVELOPMENT
LASSE AHO, MANAGING DIRECTOR:
Olvi Group’s third quarter included moments of success as well as challenges imposed by the operating environment. Earnings improved in Finland, Latvia and Lithuania even though the weather in the season’s most important month, July, was clearly cooler and rainier than in the previous year. The greatest challenge to earnings development is the continuing negative trend in the Belarusian currency. Heavy devaluation of the Belarusian currency had a negative impact of approximately 2.3 million euro on the Group’s January-September profit compared to the previous year.
Market development in Finland is still facing challenges. However, slight improvement in profitability has been realised through cost savings, efficiency measures and sales actions.
The profitability and market share in Estonia remained on a very strong level. However, the sales volume and, accordingly, earnings fell short of the previous year due to the market dip caused by cool and rainy weather.
The business in Latvia developed favourably during the late spring and summer. Earnings in Latvia outperformed the previous year both in the third quarter and in cumulative figures, even though the sales volume has declined due to a drop in manufacturing for other Group companies and the general market situation.
In Lithuania, the market share strengthened, sales volume increased and earnings improved on the previous year. In addition to business development, positive news were received from an annual customer survey: Volfas Engelman ranked second in a comparison of most liked beer brands.
In spite of the challenges brought by currency fluctuation, business in Belarus is developing favourably. The sales volume increased by 4 percent, and the market share continued to grow. Lidskoe beer was ranked as the number one brand in the Belarusian market according to two different market surveys. Lidskoe beer was the primary choice for customers according to the annual “People’s Trade Mark Contest”, as well as the number one brand in the Belarusian market according to the national “Brand Choice” competition. The brand competition arranged by MASMI Research was aimed at marketing professionals.
The Group will continue to make investments at a more moderate pace. A logistics investment in Finland was completed during the spring, making operations even more efficient. Investments carried out this year increased the production capacity in Belarus, which will allow further growth in sales volume. The total amount of investments in 2015 will be less than in the previous year, which will have a positive effect on the company’s cash flow.
SEASONAL NATURE OF THE OPERATIONS
The Group’s business operations are characterised by seasonal variation. The net sales and operating profit from the reported geographical segments do not accumulate evenly but vary according to the time of the year and the characteristics of each season.
SALES DEVELOPMENT
Olvi Group’s sales volume increased in January-September by 0.6 percent to 452.1 (449.3) million litres. The sales volume from July to September was 168.0 (170.4) million litres.
The sales volume increased in January-September in Belarus and Lithuania. However, the volume fell short of the previous year in Estonia and Finland above all due to cooler spring and summer weather. The volume development in Latvia reflects the decline in sales to other Group entities.
Sales volume development by unit:
| Sales volume, million litres | 7-9/ 2015 | 7-9/ 2014 | Change % | 1-9/ 2015 | 1-9/ 2014 | Change % |
| Finland (Olvi plc) | 41.0 | 42.3 | -2.9 | 110.9 | 114.7 | -3.3 |
| Estonia (AS A. Le Coq) | 33.7 | 37.9 | -11.2 | 96.7 | 104.6 | -7.5 |
| Latvia (A/S Cēsu Alus) | 19.3 | 20.0 | -3.8 | 54.6 | 63.2 | -13.7 |
| Lithuania (AB Volfas Engelman) | 25.5 | 23.9 | 6.5 | 66.8 | 62.9 | 6.2 |
| Belarus (OAO Lidskoe Pivo) | 54.0 | 54.1 | -0.1 | 140.5 | 135.2 | 3.9 |
| Eliminations | -5.4 | -7.8 | -17.3 | -31.3 | ||
| Total | 168.0 | 170.4 | -1.4 | 452.1 | 449.3 | 0.6 |
The Group’s net sales in January-September amounted to 241.7 (254.4) million euro and in July-September to 88.9 (97.8) million euro. The negative net sales development is affected by declined sales volumes in Finland and Estonia as well as the weakened exchange rate in Belarus.
The comparison figures for net sales have been changed to correspond to the accounting policy adopted as of the beginning of the year, with marketing subsidies to customers now being deducted from net sales as a sales adjustment item similar to discounts.
Net sales development by unit:
| Net sales, million euro | 7-9/ 2015 | 7-9/ 2014 | Change % | 1-9/ 2015 | 1-9/ 2014 | Change % |
| Finland (Olvi plc) | 28.4 | 28.9 | -1.9 | 76.9 | 80.2 | -4.2 |
| Estonia (AS A. Le Coq) | 20.7 | 23.3 | -11.1 | 59.5 | 64.4 | -7.6 |
| Latvia (A/S Cēsu Alus) | 9.1 | 9.1 | -0.4 | 24.8 | 28.6 | -13.5 |
| Lithuania (AB Volfas Engelman) | 11.1 | 10.8 | 3.4 | 28.5 | 28.5 | -0.2 |
| Belarus (OAO Lidskoe Pivo) | 22.1 | 29.0 | -23.8 | 59.5 | 65.6 | -9.3 |
| Eliminations | -2.5 | -3.2 | -7.5 | -12.9 | ||
| Total | 88.9 | 97.8 | -9.1 | 241.7 | 254.4 | -5.0 |
EARNINGS DEVELOPMENT
The Group’s operating profit in January-September stood at 31.8 (36.5) million euro, or 13.2 (14.3) percent of net sales. Operating profit in July-September stood at 14.1 (17.2) million euro, which was 15.9 (17.5) percent of net sales. One million euro of the Group’s earnings drop in the third quarter is caused by depreciation in the Belarusian exchange rate.
Operating profit development by unit:
| Operating profit (comparable) million euro | 7-9/ 2015 | 7-9/ 2014 | Change % | 1-9/ 2015 | 1-9/ 2014 | Change % |
| Finland (Olvi plc) | 3.1 | 2.3 | 35.3 | 6.0 | 5.8 *) | 3.0 |
| Estonia (AS A. Le Coq) | 5.1 | 6.0 | -14.8 | 12.8 | 14.3 | -10.8 |
| Latvia (A/S Cēsu Alus) | 1.3 | 0.8 | 54.0 | 2.5 | 2.2 | 16.4 |
| Lithuania (AB Volfas Engelman) | 1.5 | 1.3 | 19.2 | 2.3 | 1.9 | 21.5 |
| Belarus (OAO Lidskoe Pivo) | 3.3 | 6.6 | -50.5 | 8.4 | 12.3 | -31.2 |
| Eliminations | -0.2 | 0.2 | -0.1 | 0.1 *) | ||
| Total | 14.1 | 17.2 | -17.7 | 31.8 | 36.5 | -12.8 |
*) Reported operating profit in Finland 1-9/2014 stood at 6.5 million euro. The reported operating profit included non-recurring income of 0.7 million euro attributable to an intra-Group sales gain. The country-specific data for 2014 has been adjusted for comparability with the 1-9/2015 figures.
The Group’s January-September profit after taxes fell short of the previous year and amounted to 17.2 (29.4) million euro. In addition to business development, the decline in profit for the period was affected by unrealised exchange rate differences related to the Belarusian subsidiary, which were recognised in financial items.
Earnings per share calculated from the profit belonging to parent company shareholders in January-September stood at 0.83 (1.39) euro, and the July-September figure was 0.37 (0.73) euro.
BALANCE SHEET, FINANCING AND INVESTMENTS
Olvi Group’s balance sheet total at the end of September 2015 was 326.0 (331.0) million euro. Equity per share at the end of September 2015 stood at 8.73 (9.07) euro. The equity ratio remained strong at 56.1 (57.6) percent and the gearing ratio was 31.7 (28.0) percent. The current ratio, which represents the Group’s liquidity, was 1.1 (1.2).
The amount of interest-bearing liabilities at the end of September was 65.1 (61.2) million euro, including current liabilities of 35.5 (26.4) million euro.
Olvi Group’s gross capital expenditure in January-September amounted to 21.1 (31.9) million euro. The parent company Olvi accounted for 2.8 million euro, the Baltic subsidiaries for 4.4 million euro and Lidskoe Pivo in Belarus for 13.9 million euro of the total.
PRODUCT DEVELOPMENT AND NEW PRODUCTS
Research and development includes projects to design and develop new products, packages, processes and production methods, as well as further development of existing products and packages. The R&D costs have been recognised as expenses. The main objective of Olvi Group’s product development is to create new products for profitable and growing beverage segments.
NEW PRODUCTS
Finland
In June, a new brand of long drink already familiar from tourism to Estonia was introduced into Finnish retail stores: the A. Le Coq Long Drink with grapefruit flavour in 12-packs. The launch continued in September with the introduction of new package variants. In September, a totally new international soft drink brand Buck’s was introduced in glass bottles and cans with two flavours. Furthermore in September, the bottle size for 1.5-litre KevytOlo mineral waters increased by 10 percent to 1.65 litres. The bottle size for KevytOlo juice mineral waters increased from 0.95-litre to 1.5-litre bottles. The KevytOlo brand was extended with two new functional variants: fibre and antioxidant. Two variants of the Vitamineral Water range familiar from Estonia were introduced in Finland.
Subsidiaries
A. Le Coq of Estonia introduced the A. Le Coq Kohviporter (6%) coffee porter beer. Ciders saw the introduction of the new brand Linda Ubin, with no added sugar at all. The Vitamineral Water range was extended with the new Vitality variant. Aura Active juice drinks were supplemented by the new flavour blueberry-blackcurrant-raspberry.
Cēsu Alus of Latvia introduced the coffee-flavoured dark beer Cēsu Premium Coffee Porter. October saw the introduction of caramellike Brūža Winter Porter. The new flavour of cranberry was introduced to the Cēsu 14 cocktail range. The Vitamin Performance range was supplemented by the sports beverage Vitamin Performance Isotonic Sport. The range was also extended to milk-based protein drinks, Protein Performance in two flavours, both containing 28 g of protein.
In October, Volfas Engelman of Lithuania introduced the Volfas Engelman Kolekcinis Galaxy Special Limited Edition beer in aluminium bottles.
In Belarus, Lidskoe Pivo started the manufacture of Pepsi products in July by introducing Pepsi Cola in 0.5-litre, 1.0-litre and 1.5-litre bottles. 7Up and Mirinda were also introduced in the same package sizes. The dry hopped Australian Bitter was introduced as the third variant in the special beers range. The honey-flavoured Kvass Lidskiy Zimniy will be introduced for the winter season in 1.0-litre and 1.5-litre bottles.
Detailed information on new products can be found on each company’s Web site.
PERSONNEL
Olvi Group’s average number of personnel in January-September was 1,970 (1,986).
The greatest decline in the Group’s average number of personnel was seen in Finland, where the figure dropped by 31 people. The decline in Finland reflects the reduction in the number of sales promoters as well as the effects of the efficiency measures and reorganisation carried out after the statutory co-operation negotiations completed in January 2015.
The aggregate number of personnel in the Baltic states increased by 15 people from January to September. The number of personnel in Belarus remained on a par with the previous year in January-September but increased in the third quarter.
Olvi Group’s average number of personnel by country:
| 7-9/ 2015 | 7-9/ 2014 | Change % | 1-9/ 2015 | 1-9/ 2014 | Change % | |
| Finland | 338 | 380 | -11.1 | 348 | 379 | -8.2 |
| Estonia | 348 | 341 | 2.1 | 343 | 336 | 2.1 |
| Latvia | 203 | 214 | -5.1 | 206 | 219 | -5.9 |
| Lithuania | 238 | 216 | 10.2 | 235 | 214 | 9.8 |
| Belarus | 851 | 835 | 1.9 | 838 | 838 | 0.0 |
| Total | 1,978 | 1,986 | -0.4 | 1,970 | 1,986 | -0.8 |
MANAGEMENT AND AUDITORS
The Chairman of the Board of Olvi plc is Heikki Hortling, M.Sc. (Econ), Industrial Counsellor, and the Vice Chairman is Esa Lager, M.Sc. (Econ), LL.M. Other members of the Board of Directors include Jaakko Autere, M.Sc. (Econ), Nora Hortling, M.Sc. (Econ) (since 16 April 2015), Elisa Markula, M.Sc. (Econ) (since 16 April 2015) and Heikki Sirviö, M.Sc. (Engineering), Industrial Counsellor (since 16 April 2015). In addition, until the Annual General Meeting of Olvi plc held on 16 April 2015, the members of the Board included Heikki Sinnemaa, LL.M, and Tarja Pääkkönen, Dr. Tech.
The company’s auditor is the authorised public accounting firm PricewaterhouseCoopers Oy, with Sami Posti, Authorised Public Accountant, as auditor in charge.
MANAGEMENT
The Management Group of Olvi plc consists of Lasse Aho, Managing Director (Chairman), Ilkka Auvola, Sales Director, Olli Heikkilä, Marketing Director, Pia Hortling, Product Development and Purchasing Director, Kati Kokkonen, Chief Financial Officer, Lauri Multanen, Production Director, as well as Marjatta Rissanen, Customer Service and Administrative Director.
The Managing Directors of the subsidiaries are:
AS A. Le Coq, Tartu, Estonia - Tarmo Noop
A/S Cēsu Alus, Cēsis, Latvia - Eva Sietiņsone
AB Volfas Engelman, Kaunas, Lithuania - Marius Horbačauskas
OAO Lidskoe Pivo, Lida, Belarus - Audrius Mikšys
The Managing Directors of the subsidiaries report to Lasse Aho, the Managing Director of Olvi plc.
The Management Group of each subsidiary consists of the corresponding Managing Director and two to four sector directors.
GROUP STRUCTURE
In August 2015, Olvi Group acquired 26 shares in the subsidiary A/S Cēsu Alus. There were no other changes in Olvi’s holdings in subsidiaries in January-September 2015.
Olvi’s holdings in the subsidiaries are:
| 30 Sep 2015 | 31 Dec 2014 | Change | |
| AS A. Le Coq, Estonia | 100.00 | 100.00 | - |
| A/S Cēsu Alus, Latvia | 99.87 | 99.86 | 0.01 |
| AB Volfas Engelman, Lithuania | 99.58 | 99.58 | - |
| OAO Lidskoe Pivo, Belarus | 94.57 | 94.57 | - |
Furthermore, A. Le Coq has a 49.0 percent holding in AS Karme and 20.0 percent holding in Verska Mineraalvee OÜ in Estonia.
SHARES
Olvi’s share capital at the end of September 2015 stood at 20.8 million euro. The total number of shares was 20,758,808, of these 17,026,552 or 82.0 percent being publicly traded Series A shares and 3,732,256 or 18.0 percent Series K shares.
Each Series A share carries one (1) vote and each Series K share carries twenty (20) votes. Series A and Series K shares have equal rights to dividends.
Detailed information on Olvi’s shares and share capital can be found in the tables attached to this interim report, in Table 5, Section 4.
The total trading volume of Olvi A shares on Nasdaq OMX Helsinki in January-September 2015 was 1,810,277 (1,579,911) shares, which represented 10.6 (9.3) percent of all Series A shares. The value of trading was 43.4 (41.0) million euro.
The Olvi A share was quoted on Nasdaq OMX Helsinki (Helsinki Stock Exchange) at 22.09 (23.95) euro at the end of September 2015. In January-September, the highest quote for the Series A share was 27.20 (29.90) euro and the lowest quote was 20.51 (23.30) euro. The average price in January-September was 23.97 (25.98) euro.
At the end of September 2015, the market capitalisation of Series A shares was 376.1 (407.8) million euro and the market capitalisation of all shares was 458.6 (497.2) million euro.
The number of shareholders at the end of September 2015 was 10,034 (9,983). Foreign holdings plus foreign and Finnish nominee-registered holdings represented 22.4 (20.0) percent of the total number of book entries and 5.1 (4.5) percent of total votes.
Foreign and nominee-registered holdings are reported in Table 5, Section 9 of the tables attached to this interim report, and the largest shareholders are reported in Table 5, Section 10.
Treasury shares
There were no changes in the number of treasury shares held by Olvi in January-September 2015. At the end of the reporting period, Olvi held 1,124 Series A shares as treasury shares. Treasury shares held by the company itself are ineligible for voting. Detailed information on treasury shares is provided in Table 5, Section 6 of the tables attached to this interim report.
Flagging notices
During January-September 2015, Olvi has not received any flagging notices in accordance with Chapter 2, Section 10 of the Securities Markets Act.
BUSINESS RISKS AND THEIR MANAGEMENT
Risk management
Risk management is a part of Olvi Group’s everyday management and operations. The objective of risk management is to ensure the realisation of the company’s strategy and secure its financial development and the continuity of business. The task of risk management is to operate proactively and create operating conditions in which business risks are managed comprehensively and systematically in all of the Group companies and all levels of the organisation.
Business risks and uncertainties in the near term
The most substantial factor hampering the predictability of Olvi Group’s business relates to Belarus and its economic and political outlook for the next few years. Furthermore, negative development of the Russian economy may impose challenges on the Belarusian operating environment.
Operations in Belarus involve foreign exchange risks arising from the cash flows of purchases and sales in foreign currency, as well as the investment in the Belarusian subsidiary and the conversion of its income statement and balance sheet items into euro. The Group’s other foreign exchange risks can be considered minor.
Other short-term risks and uncertainties are related to continuing negative development of the general economic circumstances, changes in the competitive situation, as well as the impacts these may have on the company’s operations.
In addition to the risks described above, there have been no significant changes in Olvi Group’s business risks. A more detailed description of the risks is provided in the Board of Directors’ report and the notes to the financial statements, as well as in the Investors/Corporate Governance section of the company’s Web site.
ANNUAL GENERAL MEETING
Decisions made at the General Meeting of 16 April 2015 can be found in the bulletin released on 16 April 2015.
NEAR-TERM OUTLOOK
Olvi estimates that the Group’s sales volume for 2015 will increase slightly on the previous year. Net sales and operating profit are estimated to fall slightly short of 2014. The Group had previously disclosed the following outlook: Olvi estimates that the Group’s sales volume for 2015 will increase slightly on the previous year. Net sales and operating profit are estimated to be on a par with 2014 or slightly lower.
OLVI PLC
Board of Directors
Further information:
Lasse Aho, Managing Director, Olvi plc
Phone +358 290 00 1050 or +358 400 203 600
TABLES:
- Statement of comprehensive income, Table 1
- Balance sheet, Table 2
- Changes in shareholders’ equity, Table 3
- Cash flow statement, Table 4
- Notes to the interim report bulletin, Table 5
DISTRIBUTION:
NASDAQ OMX Helsinki Ltd
Key media
www.olvi.fi
| OLVI GROUP | TABLE 1 | |||||
| INCOME STATEMENT | ||||||
| EUR 1,000 | ||||||
|
7-9/ 2015 |
7-9/ 2014 |
1-9/ 2015 |
1-9/ 2014 |
1-12/ 2014 |
||
| Net sales | 88922 | 97832*) | 241664 | 254445*) | 320785*) | |
| Other operating income | 229 | 294 | 1309 | 1037 | 1626 | |
| Operating expenses | -70855 | -76832*) | -198966 | -207766*) | -266504*) | |
| Depreciation and impairment | -4183 | -4138 | -12178 | -11216 | -14907 | |
| Operating profit | 14113 | 17156 | 31829 | 36500 | 41000 | |
| Financial income | -375 | 377 | 299 | 2482 | 3990 | |
| Financial expenses | -5927 | 374 | -11256 | -1659 | -3985 | |
| Share of profit in associates | 0 | 0 | 0 | 0 | 48 | |
| Earnings before tax | 7811 | 17907 | 20872 | 37323 | 41053 | |
| Taxes **) | -196 | -2359 | -3697 | -7893 | -7974 | |
| NET PROFIT FOR THE PERIOD | 7615 | 15548 | 17175 | 29430 | 33079 | |
| Other comprehensive income items: | ||||||
| Translation differences related to | ||||||
| foreign subsidiaries | -5881 | 1416 | -13441 | -538 | -2874 | |
| TOTAL COMPREHENSIVE INCOME FOR THE PERIOD | 1734 | 16964 | 3734 | 28892 | 30205 | |
| Distribution of profit: | ||||||
| - parent company shareholders | 7735 | 15221 | 17265 | 28860 | 32522 | |
| - non-controlling interests | -120 | 327 | -90 | 570 | 557 | |
| Distribution of comprehensive income: | ||||||
| - parent company shareholders | 2122 | 16607 | 4442 | 28387 | 29879 | |
| - non-controlling interests | -388 | 357 | -708 | 505 | 326 | |
| Earnings per share calculated from the profit belonging | ||||||
| to parent company shareholders, EUR | ||||||
| - undiluted | 0.37 | 0.73 | 0.83 | 1.39 | 1.57 | |
| - diluted | 0.37 | 0.73 | 0.83 | 1.39 | 1.57 | |
*) The previous year’s net sales have been adjusted for comparability with the year 2015.
**) Taxes calculated from the profit for the review period.
| OLVI GROUP | TABLE 2 | ||
| BALANCE SHEET | |||
| EUR 1,000 | |||
| 30 Sep 2015 | 30 Sep 2014 | 31 Dec 2014 | |
| ASSETS | |||
| Non-current assets | |||
| Tangible assets | 185426 | 189618 | 192149 |
| Goodwill | 16122 | 18565 | 18217 |
| Other intangible assets | 4234 | 2663 | 4562 |
| Shares in associates | 1125 | 1077 | 1125 |
| Financial assets available for sale | 544 | 549 | 549 |
| Loans receivable and other non-current receivables | 333 | 349 | 333 |
| Deferred tax receivables | 168 | 171 | 163 |
| Total non-current assets | 207952 | 212992 | 217098 |
| Current assets | |||
| Inventories | 43359 | 46498 | 43522 |
| Accounts receivable and other receivables | 66418 | 63475 | 66309 |
| Income tax receivable | 787 | 341 | 1023 |
| Other non-current assets held for sale | 421 | 4 | 421 |
| Liquid assets | 7095 | 7682 | 4382 |
| Total current assets | 118080 | 118000 | 115657 |
| TOTAL ASSETS | 326032 | 330992 | 332755 |
| SHAREHOLDERS’ EQUITY AND LIABILITIES | |||
| Shareholders’ equity held by parent company shareholders | |||
| Share capital | 20759 | 20759 | 20759 |
| Other reserves | 1092 | 1092 | 1092 |
| Treasury shares | -8 | -8 | -8 |
| Translation differences | -35787 | -20793 | -22964 |
| Retained earnings | 195221 | 187282 | 191408 |
| 181277 | 188332 | 190287 | |
| Share belonging to non-controlling interests | 1496 | 2365 | 2252 |
| Total shareholders’ equity | 182773 | 190697 | 192539 |
| Non-current liabilities | |||
| Financial liabilities | 29640 | 34810 | 30040 |
| Other liabilities | 0 | 1 | 2 |
| Deferred tax liabilities | 6045 | 5288 | 5598 |
| Current liabilities | |||
| Financial liabilities | 35474 | 26354 | 31652 |
| Accounts payable and other liabilities | 71176 | 72747 | 72899 |
| Income tax liability | 924 | 1095 | 25 |
| Total liabilities | 143259 | 140295 | 140216 |
| TOTAL SHAREHOLDERS’ EQUITY AND LIABILITIES | 326032 | 330992 | 332755 |
| OLVI GROUP | TABLE 3 | ||||||||||
| CHANGES IN SHAREHOLDERS’ EQUITY | |||||||||||
|
EUR 1,000 |
Share capital | Other reserves | Treasury shares reserve | Translation differences | Retained earnings | Share of non-controlling interests | Total | ||||
| Shareholders’ equity 1 Jan 2014 | 20759 | 1092 | -8 | -20321 | 167420 | 2597 | 171539 | ||||
| Adjustments for hyperinflation | 3780 | 217 | 3997 | ||||||||
| Adjusted shareholders’ equity 1 Jan 2014 | 20759 | 1092 | -8 | -20321 | 171200 | 2814 | 175536 | ||||
| Comprehensive income: | |||||||||||
|
Net profit for the period |
28860 | 570 | 29430 | ||||||||
|
Other comprehensive income items: |
|||||||||||
|
Translation differences |
-473 | -65 | -538 | ||||||||
| Total comprehensive income for the period | -473 | 28860 | 505 | 28892 | |||||||
| Transactions with shareholders: | |||||||||||
| Payment of dividends | -13492 | -72 | -13564 | ||||||||
| Total transactions with shareholders | -13492 | -72 | -13564 | ||||||||
| Changes in holdings in subsidiaries: | |||||||||||
| Acquisition of shares from | |||||||||||
|
non-controlling interests |
-168 | -168 | |||||||||
|
Change in share belonging to non- controlling |
|||||||||||
| interests | 882 | -882 | 0 | ||||||||
| Total changes in holdings in subsidiaries | 714 | -882 | -168 | ||||||||
| Shareholders’ equity 30 Sep 2014 | 20759 | 1092 | -8 | -20793 | 187282 | 2365 | 190697 | ||||
|
|
|||||||||||
|
EUR 1,000 |
Share capital |
Other reserves |
Treasury shares reserve |
Translation differences |
Retained earnings |
Share of non-controlling interests |
Total |
||||
| Shareholders’ equity 1 Jan 2015 | 20759 | 1092 | -8 | -22964 | 191408 | 2252 | 192539 | ||||
| Adjustments for hyperinflation | 0 | 0 | 0 | ||||||||
| Adjusted shareholders’ equity 1 Jan 2015 | 20759 | 1092 | -8 | -22964 | 191408 | 2252 | 192539 | ||||
| Comprehensive income: | |||||||||||
|
Net profit for the period |
17265 | -90 | 17175 | ||||||||
|
Other comprehensive income items: |
|||||||||||
|
Translation differences |
-12823 | -618 | -13441 | ||||||||
| Total comprehensive income for the period | -12823 | 17265 | -708 | 3734 | |||||||
| Transactions with shareholders: | |||||||||||
| Payment of dividends | -13492 | -47 | -13539 | ||||||||
| Share-based incentives | 40 | 40 | |||||||||
| Total transactions with shareholders | -13452 | -47 | -13499 | ||||||||
| Changes in holdings in subsidiaries: | |||||||||||
| Acquisition of shares from | |||||||||||
|
non-controlling interests |
0 | 0 | |||||||||
|
Change in share belonging to non- controlling |
|||||||||||
| interests | 0 | -1 | -1 | ||||||||
| Total changes in holdings in subsidiaries | 0 | -1 | -1 | ||||||||
| Shareholders’ equity 30 Sep 2015 | 20759 | 1092 | -8 | -35787 | 195221 | 1496 | 182773 | ||||
| Other reserves include the share premium account, legal reserve and other reserves. | |||||||||||
|
|
|||||||||||
| OLVI GROUP | TABLE 4 | ||||||||||
| CASH FLOW STATEMENT | |||||||||||
| EUR 1,000 | |||||||||||
| 1-9/2015 | 1-9/2014 | 1-12/2014 | |||||||||
| Net profit for the period | 17175 | 29430 | 33079 | ||||||||
| Adjustments to profit for the period | 23227 | 22272 | 25699 | ||||||||
| Change in net working capital | -3909 | -5744 | -2358 | ||||||||
| Interest paid | -738 | -1519 | -3393 | ||||||||
| Interest received | 141 | 235 | 385 | ||||||||
| Taxes paid | -1841 | -4826 | -7063 | ||||||||
| Cash flow from operations (A) | 34055 | 39848 | 46349 | ||||||||
| Investments in tangible and intangible | |||||||||||
| assets | -21366 | -34066 | -43855 | ||||||||
| Sales gains from tangible and intangible | |||||||||||
| assets | 194 | 60 | 200 | ||||||||
| Expenditure on other investments | 5 | -250 | -298 | ||||||||
| Cash flow from investments (B) | -21167 | -34256 | -43953 | ||||||||
| Withdrawals of loans | 20571 | 25835 | 32657 | ||||||||
| Repayments of loans | -17313 | -17502 | -24542 | ||||||||
| Dividends paid | -13509 | -13537 | -13531 | ||||||||
| Increase (-) / decrease (+) in current interest- | |||||||||||
| bearing business receivables | 7 | -8 | -23 | ||||||||
| Increase (-) / decrease (+) in long-term | |||||||||||
| loan receivables | 3 | 0 | 16 | ||||||||
| Cash flow from financing (C) | -10241 | -5212 | -5423 | ||||||||
| Increase (+)/decrease (-) in liquid assets (A+B+C) | 2647 | 380 | -3027 | ||||||||
| Liquid assets 1 January | 4382 | 7507 | 7507 | ||||||||
| Effect of exchange rate changes | 66 | -205 | -98 | ||||||||
| Liquid assets 30 Sep/31 Dec | 7095 | 7682 | 4382 | ||||||||
OLVI GROUP TABLE 5
NOTES TO THE INTERIM REPORT
Except for the changes detailed below, the accounting policies used for this interim report are the same as those used for the annual financial statements 2014. The accounting policies are presented in the Annual Report 2014, which was published on 24 March 2015.
As of the beginning of the accounting period 2015, Olvi Group has redefined the accounting for marketing subsidies granted to customers so that they are deducted from net sales as an sales adjustment item similar to discounts granted. After the change, the presentation corresponds better to the true meaning of marketing subsidies. Previously a part of the marketing subsidies was presented as marketing expenses under other operating expenses.
Olvi Group has discontinued the application of the IAS 29 Financial Reporting in Hyperinflationary Economies standard in its Belarusian unit because the Belarusian functional currency is no longer considered hyperinflationary as referred to in the standard.
The Group has adopted the following new or revised standards and interpretations in 2015:
- Annual improvements 2012
- Annual improvements 2013
- Amendment to IAS 19, “Employee benefits” regarding employee or third party contributions to defined benefit plans
- IFRIC 21 Levies
The above changes in standards and their interpretations do not have any substantial effect on the income statement or balance sheet. Some changes in standards may affect the scope of information disclosed in the notes.
The information in the interim report is presented in thousands of euros (EUR 1,000). For the sake of presentation, individual figures and totals have been rounded to full thousands, which causes rounding differences in additions. The information disclosed in the interim report is unaudited.
| 1. SEGMENT INFORMATION | |||||
| SALES BY GEOGRAPHICAL SEGMENT (1,000 litres) | |||||
|
7-9/ 2015 |
7-9/ 2014 |
1-9/ 2015 |
1-9/ 2014 |
1-12/ 2014 |
|
| Olvi Group total | 168031 | 170386 | 452127 | 449306 | 576478 |
| Finland | 41047 | 42287 | 110888 | 114716 | 151828 |
| Estonia | 33657 | 37898 | 96727 | 104567 | 131550 |
| Latvia | 19266 | 20025 | 54565 | 63199 | 76096 |
| Lithuania | 25452 | 23896 | 66774 | 62884 | 81054 |
| Belarus | 54026 | 54103 | 140510 | 135228 | 169919 |
| - sales between segments | -5417 | -7823 | -17337 | -31288 | -33969 |
| NET SALES BY GEOGRAPHICAL SEGMENT (EUR 1,000) | |||||
|
7-9/ 2015 |
7-9/ 2014 |
1-9/ 2015 |
1-9/ 2014 |
1-12/ 2014 |
|
| Olvi Group total | 88922 | 97832*) | 241664 | 254445*) | 320785*) |
| Finland | 28377 | 28915 | 76851 | 80181 | 105329 |
| Estonia | 20729 | 23320 | 59508 | 64378 | 80666 |
| Latvia | 9061 | 9095 | 24775 | 28645 | 34112 |
| Lithuania | 11137 | 10771 | 28465 | 28510 | 36130 |
| Belarus | 22074 | 28976 | 59519 | 65604 | 78554 |
| - sales between segments | -2456 | -3245 | -7454 | -12873 | -14006 |
|
*) The previous year’s figures have been adjusted for comparability with the year 2015. OPERATING PROFIT BY GEOGRAPHICAL SEGMENT (EUR 1,000) |
|||||
|
7-9/ 2015 |
7-9/ 2014 |
1-9/ 2015 |
1-9/ 2014 |
1-12/ 2014 |
|
| Olvi Group total | 14113 | 17156 | 31829 | 36500 | 41000 |
| Finland | 3113 | 2300 | 5962 | 6468*) | 7436*) |
| Estonia | 5134 | 6023 | 12745 | 14281 | 16504 |
| Latvia | 1280 | 831 | 2506 | 2153 | 2058 |
| Lithuania | 1511 | 1268 | 2298 | 1891 | 2356 |
| Belarus | 3260 | 6580 | 8446 | 12269 | 13117 |
| - eliminations | -185 | 154 | -128 | -562 | -471 |
*) The operating profit for Finland includes non-recurring income of 0.7 million euro attributable to an intra-Group sales gain.
| 2. PERSONNEL ON AVERAGE | ||||||||||||
|
7-9/ 2015 |
7-9/ 2014 |
1-9/ 2015 |
1-9/ 2014 |
1-12/ 2014 |
||||||||
| Finland | 338 | 380 | 348 | 379 | 369 | |||||||
| Estonia | 348 | 341 | 343 | 336 | 331 | |||||||
| Latvia | 203 | 214 | 206 | 219 | 214 | |||||||
| Lithuania | 238 | 216 | 235 | 214 | 214 | |||||||
| Belarus | 851 | 835 | 838 | 838 | 830 | |||||||
| Total | 1,978 | 1,986 | 1,970 | 1,986 | 1,958 | |||||||
|
|
|
|||||||||||
| 3. RELATED PARTY TRANSACTIONS | ||||||||||||
| Employee benefits to management | ||||||||||||
| Salaries and other short-term employee benefits to the Board of Directors and Managing Director | ||||||||||||
| EUR 1,000 | ||||||||||||
|
1-9/ 2015 |
1-9/ 2014 |
1-12/ 2014 |
||||||||||
| Managing Director | 268 | 280 | 361 | |||||||||
| Chairman of the Board | 67 | 62 | 84 | |||||||||
| Other members of the Board | 109 | 95 | 125 | |||||||||
| Total | 444 | 437 | 570 | |||||||||
| 4. SHARES AND SHARE CAPITAL | ||
| 30 Sep 2015 | % | |
| Number of A shares | 17026552 | 82.0 |
| Number of K shares | 3732256 | 18.0 |
| Total | 20758808 | 100.0 |
| Total votes carried by A shares | 17026552 | 18.6 |
| Total votes carried by K shares | 74645120 | 81.4 |
| Total number of votes | 91671672 | 100.0 |
| Votes per Series A share | 1 | |
| Votes per Series K share | 20 |
The registered share capital on 30 September 2015 totalled 20,759 thousand euro.
Olvi plc’s Series A and Series K shares received a dividend of 0.65 euro per share for 2014 (0.65 euro per share for 2013), totalling 13.5 (13.5) million euro. The dividends were paid on 30 April 2015. The Series K and Series A shares entitle to equal dividend. The Articles of Association include a redemption clause concerning Series K shares.
5. SHARE-BASED PAYMENTS
Olvi Group has an active share-based incentive plan for key personnel. The aim of the share-based incentive plan is to combine the objectives of the shareholders and the key employees in order to increase the value of the company, to make the key employees committed to the company, and to offer them a competitive reward plan based on earning the company’s shares.
The bonuses for the performance periods (2014-2016/2017) will be paid in 2017 partially in Olvi plc Series A shares and partially in cash.
The plan is directed to approximately 50 people. The rewards to be paid on the basis of the plan are in total an approximate maximum of 40,000 series A shares in Olvi plc and a cash payment needed for taxes and tax-related costs arising from the shares.
From January to September 2015, accounting entries associated with the performance period from 1 July 2014 to 30 June 2017 were recognised for a total of 72.0 thousand euro.
Olvi Group has no warrants or options.
6. TREASURY SHARES
Olvi plc held a total of 1,124 of its own Series A shares on 1 January 2015.
Olvi plc has not acquired more treasury shares or transferred them to others in January-September 2015, which means that the number of Series A shares held by the company was unchanged on 30 September 2015. The purchase price of the Series A shares held as treasury shares totalled 8.5 thousand euro.
Series A shares held by Olvi plc as treasury shares represented 0.005 percent of the share capital and 0.001 percent of the aggregate number of votes. The treasury shares represented 0.007 percent of all Series A shares and associated votes.
On 16 April 2015, the General Meeting of Shareholders of Olvi plc decided to revoke any unused authorisations to acquire treasury shares and authorise the Board of Directors of Olvi plc to decide on the acquisition of the company’s own shares using unrestricted equity. The authorisation is valid for one year starting from the General Meeting and covers a maximum of 500,000 Series A shares. The shares shall be acquired for the purpose of financing or executing any upcoming corporate acquisitions or other arrangements, implementing the company’s incentive schemes or for other purposes decided upon by the Board of Directors.
The Annual General Meeting also decided to revoke all existing unused authorisations for the transfer of own shares and authorise the Board of Directors to decide on the issue of a maximum of 1,000,000 new Series A shares and the transfer of a maximum of 500,000 Series A shares held as treasury shares.
In January-September 2015, the Board of Directors of Olvi plc has not exercised the authorisations granted by the General Meeting.
| 7. NUMBER OF SHARES *) | 1-9/2015 | 1-9/2014 | 1-12/2014 |
| - average | 20757684 | 20757684 | 20757684 |
| - at end of period | 20757684 | 20757684 | 20757684 |
|
*) Treasury shares deducted. |
|||
| 8. TRADING OF SERIES A SHARES ON THE HELSINKI STOCK EXCHANGE | |||
| 1-9/2015 | 1-9/2014 | 1-12/2014 | |
| Trading volume of Olvi A shares | 1810277 | 1579911 | 2174302 |
| Total trading volume, EUR 1,000 | 43408 | 41009 | 54313 |
| Traded shares in proportion to | |||
| all Series A shares, % | 10.6 | 9.3 | 12.8 |
| Average share price, EUR | 23.97 | 25.98 | 25.03 |
| Price on the closing date, EUR | 22.09 | 23.95 | 21.07 |
| Highest quote, EUR | 27.20 | 29.90 | 29.90 |
| Lowest quote, EUR | 20.51 | 23.30 | 20.70 |
| 9. FOREIGN AND NOMINEE-REGISTERED HOLDINGS ON 30 SEPTEMBER 2015 | ||||||||||||
|
|
||||||||||||
| Book entries | Votes | Shareholders | ||||||||||
| qty | % | qty | % | qty | % | |||||||
| Finnish total | 16110944 | 77.62 | 87023808 | 94.93 | 9969 | 99.35 | ||||||
| Foreign total | 401343 | 1.93 | 401343 | 0.44 | 56 | 0.56 | ||||||
| Nominee-registered (foreign) total | 93928 | 0.45 | 93928 | 0.10 | 4 | 0.04 | ||||||
| Nominee-registered (Finnish) total | 4152593 | 20.00 | 4152593 | 4.53 | 5 | 0.05 | ||||||
| Total | 20758808 | 100.00 | 91671672 | 100.00 | 10034 | 100.00 | ||||||
| 10. LARGEST SHAREHOLDERS ON 30 SEPTEMBER 2015 | |||||||||
| Series K | Series A | Total | % | Votes | % | ||||
| 1. Olvi Foundation | 2363904 | 890613 | 3254517 | 15.68 | 48168693 | 52.54 | |||
| 2. Hortling Heikki Wilhelm *) | 903488 | 103280 | 1006768 | 4.85 | 18173040 | 19.82 | |||
|
3. The Heirs of Hortling Kalle Einari |
187104 | 25248 | 212352 | 1.02 | 3767328 | 4.11 | |||
| 4. Hortling Timo Einari | 165824 | 35308 | 201132 | 0.97 | 3351788 | 3.66 | |||
|
5. Pohjola Bank plc, nominee register |
2152900 | 2152900 | 10.37 | 2152900 | 2.35 | ||||
| 6. Hortling-Rinne Laila Marit | 102288 | 3380 | 105668 | 0.51 | 2049140 | 2.24 | |||
| 7. Nordea Bank Finland plc, nominee register | 1803060 | 1803060 | 8.69 | 1803060 | 1.97 | ||||
| 8. Ilmarinen Mutual Pension Insurance Company | 849218 | 849218 | 4.09 | 849218 | 0.93 | ||||
| 9. Varma Mutual Pension Insurance Company | 828075 | 828075 | 3.99 | 828075 | 0.90 | ||||
| 10. AC Invest Oy | 460000 | 460000 | 2.22 | 460000 | 0.50 | ||||
| Others | 9648 | 9875470 | 9885118 | 47.61 | 10068430 | 10.98 | |||
| Total | 3732256 | 17026552 | 20758808 | 100.00 | 91671672 | 100.00 | |||
| *) The figures include the shareholder’s own holdings and shares held by parties in his control. | |||||||||
| 11. PROPERTY, PLANT AND EQUIPMENT | |||
| EUR 1,000 | |||
| 1-9/2015 | 1-9/2014 | 1-12/2014 | |
| Opening balance | 192149 | 165783 | 165783 |
| Additions | 20757 | 30192 | 38998 |
| Deductions and transfers | -130 | -302 | -818 |
| Depreciation | -11548 | -10629 | -14139 |
| Exchange rate differences and adjustment for hyperinflation | -15802 | 4574 | 2325 |
| Total | 185426 | 189618 | 192149 |
|
|
|||
| 12. CONTINGENT LIABILITIES | |||
| EUR 1,000 | |||
| 30 Sep 2015 | 30 Sep 2014 | 31 Dec 2014 | |
| Pledges and contingent liabilities | |||
| For own commitments | 2422 | 2397 | 2397 |
| Leasing and rental liabilities: | |||
| Due within one year | 1153 | 1171 | 1143 |
| Due within 1 to 5 years | 1260 | 1290 | 758 |
| Due in more than 5 years | 5 | 5 | 5 |
| Leasing and rental liabilities total | 2418 | 2466 | 1906 |
| Package liabilities | 2771 | 2133 | 2496 |
| Other liabilities | 2000 | 2000 | 2000 |
13. CALCULATION OF FINANCIAL RATIOS
Equity to total assets, % = 100 * (Shareholders’ equity held by parent company shareholders + non-controlling interests) / (Balance sheet total – advances received)
Earnings per share = Profit belonging to parent company shareholders / Average number of shares during the period, adjusted for share issues
Equity per share = Shareholders’ equity held by parent company shareholders / Number of shares at end of period, adjusted for share issues
Gearing, % = 100 * (Interest-bearing debt – cash in hand and at bank) / (Shareholders’ equity held by parent company shareholders + non-controlling interests)
