Espoo, Finland, 2012-03-08 08:00 CET (GLOBE NEWSWIRE) --
EFORE PLC Interim Report March 8, 2012 9.00 a.m.
First quarter in brief (November 1, 2011 — January 31, 2012)
- Net sales totaled EUR 14.8 million (EUR 21.9 million)
- Results from operating activities totaled EUR -0.8 million (EUR 1.1 million)
- Result before taxes was EUR -1.2 million (EUR 1.0 million)
- Result for the period was EUR -1.1 million (EUR 0.5 million)
- Earnings per share was EUR -0.03 (EUR 0.01)
Fiscal year 2012 financial estimate remains unchanged. Efore estimates to reach at least EUR 80 million net sales and result from operating activities without one-time costs is expected to be positive but staying below the fiscal year 2011 level.
Vesa Vähämöttönen, Efore’s President and CEO:
“As previously estimated new fiscal year started slowly. Efore’s main customers consumed their inventories and also Chinese New Year’s holidays in the first quarter weakened the demand. Inventory levels have now mainly balanced and full year guidance remains the same.”
NET SALES AND FINANCIAL DEVELOPMENT IN THE FIRST QUARTER
Net sales in the first quarter amounted to EUR 14.8 million (EUR 21.9 million). Net sales by customer group were as follows: Telecommunication 73.0 %(78.8%) and industrial electronics 27.0% (21.2%). Geographically Efore’s deliveries were to the following areas: EMEA EUR 6.6 million (EUR 6.9 million), APAC EUR 5.5 million (EUR 11.4 million), Finland EUR 2.5 million (EUR 2.8 million) and the Americas EUR 0.3 million (EUR 0.8 million) which totaled EUR 14.8 million (EUR 21.9 million). Final geographical distribution of Efore’s products deviates from the before mentioned as Efore’s customers distribute further the products from the logistics centers to other markets.
The results from operating activities amounted to EUR -0.8 million (EUR 1.1 million).
BUSINESS DEVELOPMENT
Investment on technology and product development during the first quarter was EUR 1.7 million (EUR 1.7 million) representing 11.8% (7.6%) of net sales.
As previously estimated new fiscal year started slowly. Efore’s main customers consumed their inventories and also Chinese New Year’s holidays in the first quarter weakened the demand.
Demand of Efore’s industrial electronics continued stable. Deliveries of EMP protected power supply system cabinets to government’s security network project (TUVE) ordered by the Finnish Defence Forces continued as planned.
Efore negotiates with Chinese companies in electric vehicles (EV) industry about cooperation models to reach the access to the market. Development of EV power electronics product family is progressing as planned.
First quarter results from operating activities include one-time costs and income of approximately EUR 0.1 million related to discontinued operations of Estonia factory.
INVESTMENTS
Group investments in fixed assets during the period under the review amounted to EUR 0.7 million (EUR 1.0 million) of which product development costs were EUR 0.2 million.
At the end of the period under the review capitalized product development costs amounted to EUR 0.8 million (EUR 0.9 million).
FINANCIAL POSITION
The Group’s financial position during the period under the review was good.
The consolidated interest-bearing cash reserves exceeded interest-bearing liabilities by EUR 3.1 million (EUR 4.2 million) at the end of the period under the review. The consolidated net financial costs were EUR 0.4 million (EUR 0.1 million). The cash flow from business operations was EUR -0.1 million (EUR 2.6 million). The cash flow after investment was EUR -0.8 million (EUR 1.6 million).
The Group’s solvency ratio was 54% (46.7%) and the gearing was –13.0% (-20.3%).
Liquid assets excluding undrawn credit facilities totaled EUR 9.4 million (EUR 7.1 million) at the end of the period under the review. The balance sheet total was EUR 44.7 million (EUR 44.8 million).
PERSONNEL
The number of the Group’s personnel, including temporary personnel averaged 808 (888) during the period under the review and at the end of the period under the review it was 794 (904). At the end of January 2012 more than 90% of the personnel worked outside of Finland.
SHARES, SHARE CAPITAL AND SHAREHOLDERS
The total number of Efore Plc shares at the end of the period under the review was 42.529.648 and the registered share capital was EUR 15.000.000.
Based on the authorization given by the Annual General Meeting on February 10, 2011 and as a part of Efore Group management shareholding program Efore offered a maximum of 273,842 treasury shares held by the Company in a directed share issue against payment to Efore Management Oy, a holding company owned by the management. The subscription price of the share was EUR 0.82 per share, which was the trade volume weighted average quotation of the Company’s share on NASDAQ OMX Helsinki Ltd on 9 January 2012. All the shares were subscribed and paid on January 13, 2012. At the end of the period under the review, after the share issue, the company held a total of 587,693 Efore shares and Efore Management Oy, a company belonging to Efore group owned 2 358 242 Efore shares.
The highest share price during the period under the review was EUR 0.94 and the lowest price was EUR 0.68. The average price during the period under the review was EUR 0.79 and the closing price was EUR 0.83. The market capitalization calculated at the final trading price of the period under the review was EUR 32.9 million.
The total number of Efore shares traded on the Nasdaq OMX Helsinki during the period under the review was 4.2 million and their turnover value was EUR 3.3 million. This accounted for 10.7% of the total number of outstanding shares. The number of shareholders totaled 3 348 (3 317) at the end of the period under the review.
DECISIONS OF THE ANNUAL GENERAL MEETING
A separate stock exchange bulletin has been issued on resolutions of the Annual General Meeting of Shareholders and the authorizations granted for the Board of Directors on February 10, 2012.
ACCOUNTING POLICIES
The interim report has been drawn up in accordance with IAS 34 Standard on Interim Financial Reporting and the Group's accounting principles presented in the 2011 Financial Statements. The information in this release is unaudited.
All the figures in the report have been rounded up/down, for which reason the total of the individual figures when added together may be different from the total shown
SHORT-TERM RISKS AND FACTORS OF UNCERTAINTY
The demand fluctuation typical for the market can still cause rapid changes in Efore’s business. The most significant business risks are related to the success of key customers in their markets and to Efore's capability serve its key customers.
Progress of the EV power electronics projects depends on the customers’ own project schedules and the establishment of the whole market.
It has been recognized that global economic development may have an effect on Efore’s business environment.
A more comprehensive report on risk management is presented on the company's web-sites.
EVENTS AFTER THE PERIOD UNDER THE REVIEW
In order to improve Efore’s profitability and competitiveness of its industrial business Efore’s Board of Directors has made a decision on March 7 to transfer its production from Estonia to China and to discontinue the production of Estonia factory by October 31, 2012. According to the decision the Group’s personnel will be reduced approximately by 120 persons. Efore estimates one-time costs to be approximately EUR 1.8 million and these will be reported for the current fiscal year. With this plan Efore aims to improve its annual profitability by EUR 1.6 million.
OUTLOOK
The fundamentals for long-term positive development of wireless network equipment industry are expected to remain unchanged and therefore telecommunications network market is estimated to grow compared to previous year.
Efore estimates its position in its main market area, power products for telecommunication, to remain strong.
Inventories at the main customers are now mainly on normal level and fully they are estimated to balance during the first half of the fiscal year 2012.
FINANCIAL ESTIMATE FOR THE FISCAL YEAR 2012
Slow first months of the fiscal year 2012 will effect to the whole year. Efore estimates to reach at least EUR 80 million net sales for full fiscal year 2012.
Fiscal year 2012 result from operating activities without one-time costs is expected to be positive but staying below the fiscal year 2011 level.
TABLES
| CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME | |||
| EUR million | Nov./11- | Nov./10- | Nov./10- |
| Jan./12 | Jan./ 11 | Oct./11 | |
| 3 months | 3 months | 12 months | |
| Net sales | 14,8 | 21,9 | 88,1 |
| Change in inventories of | |||
| finished goods and work in progress | 0,6 | 1,7 | 2,5 |
| Other operating income | 0,4 | 0,0 | 0,2 |
| Materials and services | -10,6 | -16,6 | -61,7 |
| Employee benefits expenses | -3,5 | -3,5 | -15,1 |
| Depreciation | -0,8 | -0,7 | -2,6 |
| Other operating expenses | -1,8 | -1,7 | -6,9 |
| RESULTS FROM OPERATING ACTIVITIES | -0,8 | 1,1 | 4,4 |
| % net sales | -5,7 | 5,1 | 5,0 |
| Financing income | 0,4 | 0,0 | 1,3 |
| Financing expenses | -0,8 | -0,2 | -1,3 |
| Share of profit of associated | |||
| companies | 0,0 | 0,0 | 0,1 |
| RESULT BEFORE TAX | -1,2 | 1,0 | 4,5 |
| % net sales | -8,3 | 4,6 | 5,1 |
| Tax on income from operations | 0,2 | -0,5 | -1,0 |
| RESULT FOR THE PERIOD | -1,1 | 0,5 | 3,4 |
| OTHER COMPREHENSIVE INCOME: | |||
| Translation differences | 1,0 | 0,2 | 0,4 |
| Total comprehensive income | 0,0 | 0,7 | 3,9 |
| NET PROFIT/LOSS ATTRIBUTABLE | |||
| To equity holders of the parent | -1,0 | 0,5 | 3,5 |
| To non-controlling interest | 0,0 | 0,0 | 0,0 |
| TOTAL COMPREHENSIVE INCOME | |||
| ATTRIBUTABLE TO: | |||
| Equity holders of the parent | 0,0 | 0,7 | 3,9 |
| Non-controlling interest | 0,0 | 0,0 | 0,0 |
| EARNINGS PER SHARE CALCULATED ON PROFIT ATTRIBUTABLE TO EQUITY HOLDERS OF THE PARENT: | |||
| Earnings per share, basic,eur | -0,03 | 0,01 | 0,09 |
| Earnings per share, diluted, eur | -0,03 | 0,01 | 0,09 |
| INFORMATION ABOUT GEOGRAPHICAL | Nov./11- | Nov./10- | Nov./10- |
| AREAS, EUR million | Jan./12 | Jan./ 11 | Oct./11 |
| 3 months | 3 months | 12 months | |
| Americas | 0,3 | 0,8 | 2,8 |
| EMEA | 6,6 | 6,9 | 32,9 |
| FINLAND | 2,5 | 2,8 | 11,9 |
| APAC | 5,5 | 11,4 | 40,6 |
| Total | 14,8 | 21,9 | 88,1 |
| CONSOLIDATED STATEMENT OF FINANCIAL POSITION | ||||
| EUR million | Jan. 31, | Jan. 31, | change | Oct. 31, |
| 2012 | 2011 | % | 2011 | |
| ASSETS | ||||
| NON-CURRENT ASSETS | ||||
| Intangible assets | 1,4 | 1,5 | 1,4 | |
| Tangible assets | 7,1 | 4,9 | 6,8 | |
| Investments in associates | 0,0 | 0,6 | 0,0 | |
| Other long-term investments | 0,0 | 0,0 | 0,0 | |
| NON-CURRENT ASSETS | 8,5 | 7,0 | 20,4 | 8,2 |
| CURRENT ASSETS | ||||
| Inventories | 14,2 | 12,5 | 13,0 | |
| Trade receivables and other receivables | 12,3 | 18,1 | 17,3 | |
| Tax receivable, income tax | 0,4 | 0,0 | 0,1 | |
| Cash and cash equivalents | 9,4 | 7,1 | 11,2 | |
| CURRENT ASSETS | 36,2 | 37,8 | -4,1 | 41,7 |
| ASSETS | 44,7 | 44,8 | -0,3 | 49,9 |
| EQUITY AND LIABILITIES | ||||
| EQUITY | ||||
| Share capital | 15,0 | 15,0 | 15,0 | |
| Treasury shares | -2,1 | -2,1 | -2,1 | |
| Other reserves | 21,9 | 21,9 | 21,9 | |
| Translation differences | 1,6 | 0,3 | 0,6 | |
| Retained earnings | -12,6 | -14,5 | -11,6 | |
| Equity attributable to equity holders of the parent | 23,8 | 20,6 | 23,8 | |
| Equity attributable to non-controlling interests | 0,3 | 0,3 | 0,3 | |
| EQUITY | 24,1 | 20,9 | 15,3 | 24,1 |
| NON-CURRENT LIABILITIES | ||||
| Deferred tax liabilities | 0,0 | 0,0 | 0,0 | |
| Interest-bearing liabilities | 3,1 | 2,3 | 3,3 | |
| NON-CURRENT LIABILITIES | 3,1 | 2,3 | 33,2 | 3,3 |
| CURRENT LIABILITIES | ||||
| Interest-bearing liabilities | 3,2 | 0,6 | 4,1 | |
| Trade payables and other liabilities | 13,9 | 20,6 | 17,9 | |
| Tax liabilities | 0,0 | 0,0 | 0,3 | |
| Provisions | 0,3 | 0,4 | 0,3 | |
| CURRENT LIABILITIES | 17,5 | 21,6 | 22,5 | |
| LIABILITIES | 20,6 | 23,9 | 25,8 | |
| TOTAL EQUITY AND LIABILITIES | 44,7 | 44,8 | -0,3 | 49,9 |
| GROUP KEY FIGURES, EUR million | Nov./11- | Nov./10- | Nov./10- |
| Jan./12 | Jan./ 11 | Oct./11 | |
| 3 months | 3 months | 12 months | |
| Earnings per share, basic,eur | -0,03 | 0,01 | 0,09 |
| Earnings per share, diluted, eur | -0,03 | 0,01 | 0,09 |
| Equity per share, eur | 0,60 | 0,52 | 0,60 |
| Solvency ratio,% | 54,0 | 46,7 | 48,3 |
| Return on equity-%(ROE) | -17,5 | 10,3 | 15,5 |
| Return on investment-%(ROI) | -14,5 | 18,3 | 17,5 |
| Gearing, % | -13,0 | -20,3 | -16,3 |
| Net interest-bearing liabilities | -3,1 | -4,2 | -3,9 |
| Investments (intangible and tangible assets) | 0,7 | 1,0 | 4,4 |
| as percentage of net sales | 4,7 | 4,5 | 5,0 |
| Average personnel | 808 | 888 | 960 |
| CONSOLIDATED STATEMENT OF CASH FLOWS | Nov./11- | Nov./10- | change | Nov./10- |
| EUR million | Jan. /12 | Jan./11 | % | Oct./11 |
| Cash flows from operating activities | ||||
| Cash receipts from customers | 21,8 | 24,2 | 91,9 | |
| Cash paid to suppliers and employees | -21,6 | -21,4 | -86,4 | |
| Cash generated from operations | 0,3 | 2,9 | 5,5 | |
| Interest paid | 0,0 | 0,0 | -0,1 | |
| Interest received | 0,0 | 0,0 | 0,1 | |
| Other financial items | -0,4 | -0,1 | -0,5 | |
| Income taxes paid | 0,0 | -0,2 | -0,6 | |
| Net cash from operating activities (A) | -0,1 | 2,6 | -104,9 | 4,3 |
| Cash flows from investing activities | ||||
| Purchase of tangible and intangible assets | -0,7 | -1,0 | -4,3 | |
| Proceeds from sale of tangible and intangible assets | 0,0 | 0,0 | 0,1 | |
| Disposal of associated companies | 0,0 | 0,0 | 0,5 | |
| Dividend received and repayment of capital | 0,0 | 0,0 | 1,0 | |
| Net cash used in investing activities (B) | -0,7 | -1,0 | -31,1 | -2,8 |
| Cash flows from financing activities | ||||
| Capital invest by the minority | 0,0 | 0,0 | 0,0 | |
| Proceedings from short-term borrowings | 0,0 | 0,0 | 3,3 | |
| Repayment of short-term borrowings | -1,1 | 0,0 | 0,0 | |
| Proceeds from long-term borrowings | 0,0 | 0,0 | 1,1 | |
| Repayment of long-term borrowings | -0,3 | -0,3 | -0,5 | |
| Financial leasing repayment | 0,0 | -0,1 | -0,2 | |
| Net cash used in financing activities (C) | -1,3 | -0,3 | 3,7 | |
| Net increase/decrease in cash and cash | ||||
| equivalents (A+B+C) | -2,1 | 1,3 | 5,3 | |
| Cash and cash equivalents at beginning of period on Nov.1 | 11,2 | 5,9 | 5,9 | |
| Net increase/decrease in cash and cash equivalents | -2,1 | 1,3 | 5,3 | |
| Effects of exchange rate fluctuations on cash held | 0,3 | 0,0 | 0,1 | |
| Cash and cash equivalents at end of period on Jan. 31 | 9,4 | 7,1 | 11,2 | |
| GROUP CONTINGENT LIABILITIES | Jan. 31, | Jan. 31, | Oct. 31, | |
| EUR million | 2012 | 2011 | 2011 | |
| Security and contingent liabilities | ||||
| For others | ||||
| Other contingent liabilities | 0,1 | 0,1 | 0,1 | |
| Operating lease commitments | ||||
| Group as lessee | ||||
| Non-cancellable minimum operating lease | ||||
| payments: | ||||
| Less than 1 year | 1,1 | 1,6 | 1,1 | |
| 1-5 years | 0,6 | 1,6 | 0,8 | |
| Fair values of derivate financial instruments | ||||
| Currency derivatives, not hedge | ||||
| Option contract | ||||
| Nominal amount | 5,4 | 1,5 | 5,2 | |
| Negative fair value | 0,0 | 0,0 | 0,0 | |
| THE FOLLOWING TRANSACTIONS WERE | Jan. 31, | Jan. 31, | Oct. 31, | |
| CARRIED OUT WITH RELATED PARTIES: | 2012 | 2011 | 2011 | |
| EUR million | ||||
| Associated companies | ||||
| Purchases | 0,0 | 0,0 | 0,0 | |
| Liabilities | 0,0 | 0,0 | 0,0 |
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
A Share capital
B Treasury shares
C Unrestricted equity reserve
D Other reserves
E Translation differences
F Retained earnings
G Equity holders of the parent
H Non-controlling interests
I Total
| EUR million | A | B | C | D | E | F | G | H | I |
| Equity | 15,0 | -2,1 | 20,9 | 1,0 | 0,1 | -15,0 | 19,9 | 0,3 | 20,2 |
| Nov.1, 2010 | |||||||||
| Comprehensive income | 0,0 | 0,0 | 0,0 | 0,0 | 0,2 | 0,5 | 0,7 | 0,0 | 0,7 |
| Equity | 15,0 | -2,1 | 20,9 | 1,0 | 0,3 | -14,5 | 20,6 | 0,3 | 20,9 |
| January 31, 2011 | |||||||||
| EUR million | A | B | C | D | E | F | G | H | I |
| Equity | 15,0 | -2,1 | 20,9 | 1,0 | 0,6 | -11,6 | 23,8 | 0,3 | 24,1 |
| Nov.1, 2011 | |||||||||
| Comprehensive income | 0,0 | 0,0 | 0,0 | 0,0 | 1,0 | -1,0 | 0,0 | 0,0 | 0,0 |
| Capital invest by the minority | 0,0 | 0,0 | 0,0 | 0,0 | 0,0 | 0,0 | 0,0 | 0,0 | 0,0 |
| Equity | 15,0 | -2,1 | 20,9 | 1,0 | 1,6 | -12,6 | 23,8 | 0,3 | 24,1 |
| January 31, 2012 |
| 31.1.2012 | ||||
|
CALCULATION OF KEY FIGURES AND RATIOS |
||||
| Return on investment (ROI), % | = |
Profit before taxes+interest and other financing expenses / (Equity + interest-bearing liabilities, average ) |
x 100 | |
| Return on Equity (ROE), % | = | Profit/loss for the period / Equity (average ) | x 100 | |
| Current ratio | = | Current assets / Current liabilities | ||
| Solvency ratio, % | = | Equity / (Total assets - advance payments received - own shares*) | x 100 | |
| Net interest-bearing liabilities | = | Interest-bearing liabilities - financial assets at fair value through profit or loss - cash and cash equivalents | ||
| Gearing, % | = | Net interest-bearing liabilities / Equity | x 100 | |
| Earnings per share | = | Profit or loss attributable to ordinary equity holders of the parent entity/ The weighted average number of ordinary shares outstanding | ||
| Dividend per share | = | Dividend for the financial year / (Number of shares - own shares*) | ||
| Dividend payout ratio, % | = | Dividend per share / Earnings per share | x 100 | |
| Effective dividend yield, % | = | Dividend per share /Adjusted share price at balance sheet date | x 100 | |
| Equity per share | = | Equity - own shares* /Number of shares at balance sheet date | ||
| P/E-ratio | = | Adjusted share price at balance sheet date / Earnings per share | ||
| Market capitalization = | = | Adjusted share price at balance sheet date x outstanding number of shares at balance sheet date | ||
| Average personnel | = | The average number of employees at the end of each calendar month during the accounting period | ||
| All share-specific figures are based on the issue-adjusted number of shares. | ||||
| Equity is the equity owned by the holders of the parent company's shares. | ||||
|
When calculating per share performance measures equity is the equity attributable to the shareholders of the parent company, when calculating other performance measures equity includes equity attributable to the shareholders of the parent company and non-controlling interests. * There were own shares held by company January 31, 2012. |
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EFORE PLC
Board of Directors
For further information please contact Mr.Vesa Vähämöttönen, President and CEO, on March 8, 2012 at 9 – 11 a.m., tel. +358 9 4784 6312
Efore Plc will hold a news conference regarding the report for analysts and media on March 8, 2012 at 11 a.m. in Helsinki World Trade Center, address Aleksanterinkatu 17.
DISTRIBUTION
Nasdaq OMX Helsinki Oy
Principal media
Efore Group
Efore Group is an international company which develops and produces demanding power products. Efore’s head office is based in Finland and its production units are located in China and in Estonia. Efore is present also in Sweden. In the fiscal year ending in October 2011, consolidated net sales totaled EUR 88,1 million and the Group’s personnel averaged 960. The company's share is quoted on the Nasdaq OMX Helsinki Ltd. www.efore.com
Mr.Vesa Vähämöttönen, President and CEO, tel. +358 9 4784 6312