Saku's Q1 operating profit more than doubles
In the first quarter of 2007 Saku Õlletehase AS sold 21 million litres of
beverages, a notable 6 million litres or 33% up on the same period in 2006.
Commenting on the strong sales results Chairman of the Management Board Ireneusz
Smaga said that in addition to the excellent performance of its well-known
products, in 2007 Saku has launched 8 product innovations most of which have
been warmly received. “Sales of special beer Saku Abbey which was launched in
January surpassed our expectations and the exclusive can of Saku Kuld which was
launched at the beginning of the year also became an instant success - sales
exceeded the forecast two times. Other successful products include our classical
cocktail line SIN which was supplemented at the beginning of the year with two
new flavours, pomegranate flavoured DLight and KISS Spritzer Rosé,” remarked
Smaga. “Distribution of the products of the Finnish beverage producer
Sinebrychoff has also improved our results,” he added.
Revenue for the first quarter amounted to EEK 181 million (€12 million), EEK 56
million (€3.6 million) or 44% up on the first three months of 2006.
The largest, i.e., more than two-fold year-on-year growth was attained in the
sales of table water which surged to EEK 11 million (€0.7 million). Year-on-year
sales of other alcoholic beverages doubled to EEK 30 million (€2 million) and
year-on-year beer sales grew by 34% to EEK 135 million (€8.6 million). Compared
to the first quarter of 2006, domestic sales improved by 38% to EEK 155 million
(€10 million) and exports expanded almost two-fold to EEK 26 million (€1.6
million). The main export markets were Finland, Sweden, Denmark, Latvia,
Lithuania and Ukraine.
Expenses of the period totalled EEK 157 million (€10 million), EEK 41 million
(€2.7 million) or 35% up on the first quarter of 2006. Variable costs increased
on account of larger sales, growth in advertising expenses and an
inflation-related rise in wages and salaries.
The period's profit before tax amounted to EEK 25 million (€1.5 million), an EEK
15 million (€0.9 million), i.e., 2.5-fold increase on quarter 1, 2006.
The general meeting which convened on 28 March 2007 approved the proposal of the
management board to distribute for 2006 a net dividend of EEK 200 million (€12.8
million), i.e., EEK 25 (€1.6) per share. The dividends were paid out on 20 April
2007 and the distribution gave rise to income tax expense of EEK 56 million
(€3.6 million). As a result, the first quarter of 2007 ended in a loss of EEK 31
million (€2 million).
At 31 March 2007 the equity of Saku Õlletehase AS amounted to EEK 202 million
(€13 million), EEK 99 million (€6 million) less than a year ago.
The market
According to the Estonian Breweries' Association, in the first three months of
2007 the Estonian beer market expanded by 5.4% to 26 million litres. Saku
Õlletehase AS holds the leading position with a 47% market share. Similarly to
the prior year, our main efforts are directed at developing the premium and
mainstream segments. In the beer segment, the first quarter of 2007 was a period
of major product innovations. We launched special beer Saku Abbey and beer drink
DLight Pomegranate and new packaging for Saku Kuld and Carlsberg.
According to marketing research company ACNielsen, compared to the first quarter
of 2006 the Estonian cider market grew by 13.4% to 0.8 million litres. The
market share of Saku Õlletehase AS was 44.8%. In the first quarter of 2007 we
supplemented our KISS line with rosé fruit wine flavoured KISS Spritzer Rosé.
The long drink market grew by 36% to approximately 3 million litres. Our share
of the long drink market was 30%. We supplemented our classical cocktail line
SIN with club drinks SIN Mojito and SIN Cosmopolitan which helped us gain the
leading position in the premium long drink market with a 32.5% share.
In the first three months of 2007 the Estonian water market expanded by 24% to
12 million litres. The share of Saku Õlletehase AS was 13.4% while in the higher
than average price segment our share was 50.6%. In March 2007 we launched Vichy
Ice Tea which contains the extract of Ceylon tea and natural juices. Vichy Ice
Tea is available in two flavours - classical lemon and peach.
Organisational changes
In the first quarter of 2007 the Chief Financial Officer changed. After the
resignation of Janno Veskimäe on 19 February 2007 the position was taken over by
Inga Kuusik.
--------------------------------------------------------------------------------
| BALANCE SHEET | | | | | | |
--------------------------------------------------------------------------------
| | | EEK | | | € | |
--------------------------------------------------------------------------------
| (In thousands) | 31 | 31 | 31 | 31 | 31 | 31 |
| | March | March | Decembe | March | March | December |
| | 2007 | 2006 | r 2006 | 2007 | 2006 | 2006 |
--------------------------------------------------------------------------------
| ASSETS | | | | | | |
--------------------------------------------------------------------------------
| Cash and cash | 130,52 | 95,395 | 118,876 | 8,342 | 6,096 | 7,597 |
| equivalents | 0 | | | | | |
--------------------------------------------------------------------------------
| Trade receivables | 82,116 | 54,971 | 71,944 | 5,248 | 3,513 | 4,598 |
--------------------------------------------------------------------------------
| Other receivables | 12,008 | 5,171 | 7,883 | 767 | 330 | 504 |
| and prepayments | | | | | | |
--------------------------------------------------------------------------------
| Inventories | 50,642 | 48,514 | 58,771 | 3,237 | 3,101 | 3,756 |
--------------------------------------------------------------------------------
| TOTAL CURRENT | 275,28 | 204,05 | 257,474 | 17,594 | 13,040 | 16,455 |
| ASSETS | 6 | 1 | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Non-current | | | | | | |
| assets | | | | | | |
--------------------------------------------------------------------------------
| Long-term | 7,440 | 9,080 | 7,740 | 474 | 581 | 495 |
| financial | | | | | | |
| investments | | | | | | |
--------------------------------------------------------------------------------
| Property, plant | 274,31 | 279,79 | 277,788 | 17,534 | 17,882 | 17,754 |
| and equipment | 3 | 0 | | | | |
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| Intangible assets | 855 | 1,053 | 990 | 54 | 68 | 63 |
--------------------------------------------------------------------------------
| TOTAL NON-CURRENT | 282,60 | 289,92 | 286,518 | 18,062 | 18,531 | 18,312 |
| ASSETS | 8 | 3 | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| TOTAL ASSETS | 557,89 | 493,97 | 543,992 | 35,656 | 31,571 | 34,767 |
| | 4 | 4 | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| LIABILITIES AND | | | | | | |
| EQUITY | | | | | | |
--------------------------------------------------------------------------------
| Current | | | | | | |
| liabilities | | | | | | |
--------------------------------------------------------------------------------
| Lease liabilities | 134 | | 131 | 9 | | 8 |
--------------------------------------------------------------------------------
| Trade payables | 20,752 | 25,094 | 27,472 | 1,328 | 1,605 | 1,756 |
--------------------------------------------------------------------------------
| Other payables | 309,35 | 145,75 | 59,463 | 19,770 | 9,315 | 3,801 |
| | 1 | 0 | | | | |
--------------------------------------------------------------------------------
| Packaging | 25,370 | 22,146 | 23,147 | 1,621 | 1,415 | 1,479 |
| repurchase | | | | | | |
| obligation | | | | | | |
--------------------------------------------------------------------------------
| TOTAL CURRENT | 355,60 | 192,99 | 110,213 | 22,728 | 12,335 | 7,044 |
| LIABILITIES | 7 | 0 | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Non-current | | | | | | |
| liabilities | | | | | | |
--------------------------------------------------------------------------------
| Lease liabilities | 335 | | 376 | 21 | | 24 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Equity | | | | | | |
--------------------------------------------------------------------------------
| Share capital | 80,000 | 80,000 | 80,000 | 5,113 | 5,113 | 5,113 |
--------------------------------------------------------------------------------
| Statutory capital | 8,000 | 8,000 | 8,000 | 511 | 511 | 511 |
| reserve | | | | | | |
--------------------------------------------------------------------------------
| Other reserves | | | | | | |
--------------------------------------------------------------------------------
| Retained earnings | 145,40 | 227,09 | 227,099 | 9,293 | 14,514 | 14,514 |
| | 3 | 9 | | | | |
--------------------------------------------------------------------------------
| Profit / loss for | -31,45 | -14,11 | 118,304 | -2,010 | -902 | 7,561 |
| the period | 1 | 5 | | | | |
--------------------------------------------------------------------------------
| TOTAL EQUITY | 201,95 | 300,98 | 433,403 | 12,907 | 19,236 | 27,699 |
| | 2 | 4 | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| TOTAL LIABILITIES | 557,89 | 493,97 | 543,992 | 35,656 | 31,571 | 34,767 |
| AND EQUITY | 4 | 4 | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
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| INCOME STATEMENT | | | | | | |
--------------------------------------------------------------------------------
| (In thousands) | | EEK | | | € | |
--------------------------------------------------------------------------------
| | Januar | Januar | | January | January | |
| | y - | y - | | - | - | |
--------------------------------------------------------------------------------
| | March | March | | March | March | |
--------------------------------------------------------------------------------
| | 2007 | 2006 | 2006 | 2007 | 2006 | 2006 |
--------------------------------------------------------------------------------
| Revenue | | | | | | |
--------------------------------------------------------------------------------
| Sales revenue | 181,15 | 125,03 | 770,13 | 11,578 | 7,991 | 49,220 |
| | 0 | 8 | 3 | | | |
--------------------------------------------------------------------------------
| Other income | 70 | 78 | 1,511 | 5 | 5 | 97 |
--------------------------------------------------------------------------------
| Total revenue | 181,22 | 125,11 | 771,64 | 11,583 | 7,996 | 49,317 |
| | 0 | 6 | 4 | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Expenses | | | | | | |
--------------------------------------------------------------------------------
| Changes in work in | | | | | | |
| progress and | | | | | | |
--------------------------------------------------------------------------------
| finished goods | -2,121 | -2,410 | -1,973 | -136 | -154 | -126 |
| inventories | | | | | | |
--------------------------------------------------------------------------------
| Cost of materials, | 77,653 | 53,292 | 303,88 | 4,963 | 3,406 | 19,422 |
| consumables and | | | 4 | | | |
| services used | | | | | | |
--------------------------------------------------------------------------------
| Other operating | 44,704 | 32,609 | 182,06 | 2,857 | 2,084 | 11,636 |
| expenses | | | 3 | | | |
--------------------------------------------------------------------------------
| Labour costs | 21,135 | 17,434 | 85,354 | 1,351 | 1,115 | 5,455 |
--------------------------------------------------------------------------------
| Depreciation and | 14,708 | 14,330 | 58,590 | 940 | 915 | 3,745 |
| amortisation charges | | | | | | |
--------------------------------------------------------------------------------
| Other expenses | 1,213 | 595 | 3,904 | 78 | 38 | 249 |
--------------------------------------------------------------------------------
| Total expenses | 157,29 | 115,85 | 631,82 | 10,053 | 7,404 | 40,381 |
| | 2 | 0 | 2 | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| OPERATING PROFIT | 23,928 | 9,266 | 139,82 | 1,530 | 592 | 8,936 |
| | | | 2 | | | |
--------------------------------------------------------------------------------
| Net financial items | 1,031 | 515 | 2,378 | 65 | 33 | 152 |
--------------------------------------------------------------------------------
| PROFIT BEFORE TAX | 24,959 | 9,781 | 142,20 | 1,595 | 625 | 9,088 |
| | | | 0 | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Income tax expense | 56,410 | 23,896 | 23,896 | 3,605 | 1,527 | 1,527 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| PROFIT / LOSS FOR | -31,45 | -14,11 | 118,30 | -2,010 | -902 | 7,561 |
| THE PERIOD | 1 | 5 | 4 | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Basic earnings per | 0 | 0 | 14.79 | 0 | 0 | 0.95 |
| share | | | | | | |
--------------------------------------------------------------------------------
| Diluted earnings per | 0 | 0 | 14.79 | 0 | 0 | 0.95 |
| share | | | | | | |
--------------------------------------------------------------------------------
Livia Kulm
Saku Brewery
Communication Manager
+ 372 6508 303
livia.kulm@pruul.ee
