Management assessed the economic results of Harju Elekter Group in Q3 and the
first nine months to be good. Due to a decline in demand, production and
sales volumes, the Group has actively engaged in optimising and reducing both
operating and fixed expenses, achieving equivalent savings and ensuring the
profitability of the Group. The Q3 EBITDA was 9.1% (7.7%), and the first 9
months figure remained at the same level as the year before.
. million EEK million EUR
Key figures 1-9/2009 1-9/2008 1-9/2009 1-9/2008
Sales revenue 474.3 667.0 30.3 42.6
EBITDA 37.1 52.4 2.4 3.4
EBIT 22.2 38.4 1.4 2.5
Net profit for the period 17.2 39.5 1.1 2.5
incl equity holders of the Parent 15.4 37.4 1.0 2.4
EPS 0.92 EEK 2.23 EEK 0.06 EUR 0.14 EUR
At the end of the period
Total assets 591.4 658.7 37.8 42.1
Owners' equity 464.1 504.4 29.7 32.2
Average number of employees on the current period 454 501
Number of employees at the end of the period 471 521
The consolidated sales revenue of the Group in the third quarter was 120.6
million kroons (7.7 million euros), which was 46.9% less than the result of
the comparable quarter. The consolidated sales revenue of the 9m 2009 was
474.3 million kroons (30.3 million euros), which was 28.9% less than the
result of the comparable period. The core business of the Group is the
production and sales of electrical distribution systems and control panels as
well as other supportive side-activities, which was traditionally the largest
share of sales revenues - approx. 90.1%. Real estate and income from other
commercial activities together formed 10% of the consolidated sales revenue.
Of the Group's products and services, 35% (37%) were sold on the Estonian,
45% (44%) on the Finnish and 10% (12%) on the Lithuanian markets; to the
other European markets (Latvia, Sweden, Denmark and Portugal) a total of 4%
(6%) were sold. The drop in demand on domestic markets has forced a search
for new markets. Outside the European Union - in Russia, Belarus and Norway -
a total of 6% (1%) of products were sold. Sales by the Group outside the
European Union increased by 20 million kroons (1.3 million euros),
compensating for the drop in the volumes of sales into other EU countries.
The sales volume of the Estonian segment this year has declined by a quarter,
primarily due to a decline in both the Estonian and Finnish markets. In H1,
several large purchase orders came through for the Lithuanian segment. Q3
remained modest for them. The sales volume of the Lithuanian segment declined
nearly 45% in Q3 and by a quarter over the period of 9 months. Recession
reached Finland somewhat later than the Baltic States. While the Q1 sales
volume in the Finnish segment remained at the level of Q1 2008, in Q2 a
decline began in export orders in the metals and engineering industry,
compounded in Q3 by a decrease in demand on the domestic market in Finland.
Such kind of development affected significantly the business performance of
Satmatic Oy during the accounting period.
As a result of the drop in demand, production and sales volumes, the Group
has been engaging in saving on and optimising both operational and fixed
expenses. The business expenses of the Group declined at the same rate as the
sales revenue - by -46.3% in Q3 and -28% in the first 9 months. Compared to
the sales revenue, the expenses of products and services sold dropped even
more: by -48.9% in the first 9 months and by -29.7% in the accounting
quarter. The marketing and general administration expenses for the accounting
quarter is, on average, 23% less than the indicators for the comparable
period. Due to the severance and redundancy compensations paid out, general
administrative expenses in H1 remained at the level of the previous year;
however, in Q3, operating expenses were saved on, as a result of which there
arose savings on general administrative expenses for the accounting quarter.
Marketing expenses in the first 9 months have declined nearly 19%.
As at the balance day on 30 September, there were 471 people working in the
Group, whish is 50 people less than a year before. There were 44 people who,
during the accounting period, left of their own accord, due to retirement or
as a result of redundancy. In the third quarter, there was an average of 448
people working in the Group (Q3 2008: 523), included 293 (343) employees in
Estonia, 77 (94) employees in Lithuania and 78 (86) employees in Finland.
During the first 9 months the average number of employees was 454 (501). All
labour cost in Q3 2009 were 22.9 million kroons (1.5 million euros), which
was 44.5% less than in the comparable period. Labour expenses in the first 9
months dropped by over 14% to 108.5 million kroons (6.9 million euros).
Business activity of the Group in Q3 was profitable. Depreciation of fixed
assets in Q3 was 4.9 million kroons or 0.31 million euros (during the
comparable period, 4.6 million kroons or 0.3 million euros), EBITDA was 11.0
million kroons (0.7 million euros), which is 37.4% less than in the
comparable period. EBITDA was 9.1%, which is 1.4 percentage points better
than the figure for the comparable period. The operating profit was 6.0
million kroons (0.39 million euros), decreased more than 50% compared to the
Q3 2008. The operating margin was 5.0% (5.7%). The operating profit for the
first 9 months was 22.2 million kroons or 1.4 million euros (38.4 million
kroons or 2.5 million euros during the comparable period), with the operating
profit margin for the account period at 4.7% (5.8%). Depreciation of fixed
assets amounted to 14.8 million kroons (0.95 million euros) and 14.0 million
kroons (0.89 million euros) during the comparable period. EBITDA was 7.8%
(7.9%).
The consolidated net profit of the Q3 2009 was 6.1 million kroons or 0.39
million euros (in Q3 2008: 11.2 million kroons or 0.71 million euros), of
which the share of the owners of the parent company was 5.7 million kroons or
0.37 million euros (in Q3 2008: 10.3 million kroons or 0.66 million euros).
The net profit margin on the turnover was 5.1%, which is 0.2 percentage
points better than the figure for the comparable period. EPS of the reporting
period was 0.34 kroons or 0.02 euros (in Q3 2008: 0.61 kroons or 0.04 euros).
The consolidated net profit of the 9m 2009 was 17.2 million kroons or 1.1
million euros (in 9m 2008: 39.5 million kroons or 2.52 million euros), of
which the share of the owners of the parent company was 15.4 million kroons
or 1.0 million euros (in 9m 2008: 37.4 million kroons or 2.39 million euros).
The net profit margin on the turnover came out at 3.6% (5.9%). EPS of the
reporting period was 0.92 kroons or 0.06 euros (in 9m 2008: 2.23 kroons or
0.14 euros). Consolidated net profit in 2008 was impacted most by the
consolidated loss of the affiliated company and dividend revenue that was
three times lower.
In the first nine months the Group invested 0.6 million kroons or 39,000
euros in real estate (9m 2008: 0.6 million kroons or 37,000 euros), 12.9
million kroons (0.8 million euros) in tangible fixed assets and 20.0 million
kroons (1.3 million euros) in the compared period and 3.3 million kroons or
210,000 euros in intangible fixed assets (9m 2008: 195,000 kroons or 12,000
euros).
During the first nine months the liability of the Group decreased by 55.9
million kroons (3.6 million euros) to 127.3 million kroons (8.1 million
euros). During the nine months, the Group companies repaid a total of 13.8
million kroons (0.88 million euros) of the long-term loan and the short-term
loan in the amount of 25.4 million kroons (1.62 million euros) along with the
capital lease in the amount of 1.6 million kroons, i.e. 104,000 euros.
Interest-bearing debt obligations declined on the balance sheet by a total of
40.5 million kroons (2.59 million euros) to 17.8 million kroons (1.14 million
euros).
The cash flow from operations amounted to 78.7 million kroons, i.e. 5.0
million euros (51.3 million kroons, i.e. 3.3 million euros in the comparable
period). The cash flow from investments was a negative 5.2 million kroons,
i.e. 330,000 euros (in the accounting period 7.9 million kroons i.e. 505,000
euros). In financing activity, 58.1 million kroons or 3.7 million euros in
cash was disbursed (46.4 million kroons or 3.0 million euros during the
comparable period). Cash and cash equivalents increased by 15.4 million
kroons (1.0 million euros) in the first nine months and decreased by 3.0
million kroons (0.2 million euros) during the comparable period.
Andres Allikmäe
Chairman of the Board
+372 674 7400
For more information: Internal report 1-9/2009 of Harju Elekter and Mrs.
Karin Padjus, Member of the Board (phone +372 674 7403).
AS HARJU ELEKTER
BALANCE SHEET, 30.09.2009
Consolidated, unaudited
Group
in thousands EEK EUR
ASSETS 30.09.0931.12.0830.09.09 31.12.08
Cash and cash equivalents 38 761 23 379 2 477 1 494
Trade receivables and other receivables 74 493 99 449 4 761 6 356
Prepayments 4 387 3 217 281 205
Inclusive income tax 1 018 47 66 3
Inventories 83 298 123 351 5 324 7 884
TOTAL CURRENT ASSETS 200 939 249 396 12 843 15 939
Investments in associates 9 786 17 907 625 1 144
Other long-term financial investments 118 668 74 323 7 584 4 750
Investment property 129 908 133 737 8 303 8 547
Property, plant and equipment 126 517 123 423 8 086 7 889
Intangible assets 5 587 3 201 357 205
Total non-current assets 390 466 352 591 24 955 22 535
TOTAL ASSETS 591 405 601 987 37 798 38 474
LIABILITIES AND OWNERS' EQUITY
Interest-bearing loans and borrowings 5 556 41 958 355 2 682
Trade payables and other payables 97 020 112 395 6 201 7 183
Tax liabilities 8 705 11 216 556 717
Inclusive income tax 0 1 551 0 99
Short-term provision 3 828 1 294 245 83
TOTAL CURRENT LIABILITIES 115 109 166 863 7 357 10 665
NON-CURRENT LIABILITIES 12 235 16 381 782 1 046
TOTAL LIABILITIES 127 344 183 244 8 139 11 711
Share capital 168 000 168 000 10 737 10 737
Paid-in capital over/under par 6 000 6 000 384 384
Restricted reserves 115 256 69 746 7 366 4 457
Retained earnings 152 041 153 445 9 717 9 808
TOTAL OWNERS' EQUITY 441 297 397 191 28 204 25 386
Non-controlling interests 22 764 21 552 1 455 1 377
TOTAL EQUITY 464 061 418 743 29 659 26 763
TOT.LIABILITIES AND OWNERS' EQUITY 591 405 601 987 37 798 38 474
INCOME STATEMENT, 1-9/2009
Consolidated,unaudited
EEK'000
GROUP Q3 2009 Q3 2008 1-9/2009 1-9/2008
NET SALES 120 571 226 904 474 275 666 981
Cost of goods sold -98 370-192 593 -397 702 -565 659
Gross profit 22 201 34 311 76 573 101 322
Marketing expenses -6 715 -8 774 -22 253 -27 375
Administrative expenses -9 700 -12 568 -32 652 -35 185
Other revenue 376 115 1 038 262
Other expenses -113 -230 -461 -575
Operating profit 6 049 12 854 22 245 38 449
Net financial incomes/expenses -30 -718 7 991 9 249
Income from subsidiaries 5 259 -8 121 3 743
Profit from normal operations 6 024 12 395 22 115 51 441
Corporate Income tax 87 -1 245 -4 952 -11 973
Profit after taxes, incl 6 111 11 150 17 163 39 468
Attributable to:
Equity holders of the parent 5 700 10 269 15 396 37 436
Non-controlling interests 411 881 1 767 2 032
Basic and diluted
earnings per share 0,34 0,61 0,92 2,23
EUR'000
GROUP Q3 2009 Q3 2008 1-9/2009 1-9/2008
NET SALES 7 706 14 502 30 311 42 628
Cost of goods sold -6 287 -12 309 -25 418 -36 152
Gross profit 1 419 2 193 4 893 6 476
Marketing expenses -429 -561 -1 422 -1 750
Administrative expenses -620 -803 -2 087 -2 249
Other revenue 24 7 66 17
Other expenses -7 -15 -29 -37
Operating profit 387 821 1 421 2 457
Net financial incomes/expenses -2 -46 510 591
Income from subsidiaries 0 17 -519 239
Profit from normal operations 385 792 1 412 3 287
Corporate Income tax 6 -80 -316 -765
Profit after taxes, incl 391 712 1 096 2 522
Attributable to:
Equity holders of the parent 365 656 983 2 393
Non-controlling interests 26 56 113 129
Basic and diluted
earnings per share 0,02 0,04 0,06 0,14
Karin Padjus
Financial manager
+372 674 7403