HONKARAKENNE OYJ FINANCIAL STATEMENT RELEASE 12 February 2015 at 9.30 a.m.
HONKARAKENNE OYJ’S FINANCIAL STATEMENT RELEASE 1 JANUARY - 31 DECEMBER 2014
SUMMARY
Net sales for 2014 saw a year-on-year decline of 6 %. Net sales grew in both Finland & Baltics and Russia & CIS, but decreased significantly in Global Markets. The result before taxes remained in the red. Net sales in the fourth quarter were down 33 % on the corresponding period of the previous year. The Group's order book was 31 % smaller at the end of the year than in 2013.
October - December 2014
- Honkarakenne Group's consolidated net sales for the last quarter of the year amounted to MEUR 11.5 (MEUR 17.0 in 2013), representing a decrease over the same period the previous year of 33 %
- Operating profit/loss was MEUR -0.3 (MEUR 0.1). Operating profit/loss without non-recurring items was MEUR -0.1 (MEUR 0.7)
- Loss before taxes was MEUR -0.4 (MEUR -0.1)
- Earnings per share amounted to EUR -0.04 (EUR -0.07)
Year 2014
- Honkarakenne Group’s consolidated net sales for the entire year was MEUR 45.5 (48.3), representing a decrease over the same period the previous year of 6 %
- Operating loss was MEUR -2.2 (MEUR -1.7). Operating loss before non-recurring items was MEUR -2.0 (MEUR -1.1)
- Loss before taxes was MEUR -2.5 (MEUR -1.7)
- Earnings per share amounted to EUR -0.40 (EUR -0.32)
As a result of the efficiency-boosting measures and co-operation negotiations concluded during the fourth quarter, non-recurring expenses of MEUR 0.2 were recognised for the 2014 financial year.
The Board of Directors proposes to the Annual General Meeting that no dividend be paid for the financial year ended 31 December 2014.
According the Honkarakenne’s view net sales may decline in 2015 from previous year due to the situation in Russia. The result before non-recurring items and taxes is estimated to improve due to the development programme initiated by the Group.
At the end of December, the Group's order book stood at MEUR 12.5, down 31 % on the corresponding period of the previous year, when it stood at MEUR 18.1. The order book refers to orders whose delivery date falls within the next 24 months. Some orders may include terms and conditions relating to financing or building permits.
| KEY INDICATORS |
10–12/ 2014 |
10–12/ 2013 |
1-12/ 2014 |
1-12/ 2013 |
|
| Net sales, MEUR | 11.5 | 17.0 | 45.5 | 48.3 | |
| Operating profit/loss, MEUR | -0.3 | 0.1 | -2.2 | -1.7 | |
| Operating profit before non-recurring items, MEUR | -0.1 | 0.7 | -2.0 | -1.1 | |
| Profit/loss before taxes, MEUR | -0.4 | -0.1 | -2.5 | -1.7 | |
| Average number of personnel | 151 | 190 | 161 | 213 | |
| Personnel in person-years, average | 119 | 189 | 146 | 185 | |
| Earnings/share (EPS), EUR | -0.04 | -0.07 | -0.40 | -0.32 | |
| Equity ratio, % | 37 | 38 | |||
| Return on equity, % | -20 | -13 | |||
| Shareholders' equity/share, EUR | 1,80 | 2,20 | |||
| Gearing, % | 92 | 57 |
Mikko Kilpeläinen, President and CEO of Honkarakenne Oyj, in connection with the financial statement release:
"The trend in net sales in Finland, Russia and CIS was satisfactory compared to the previous year. However, price competition – particularly in Finland – weakened Honkarakenne's profitability. In Global Markets, net sales were down due to the scarcity of major construction projects and in Central Europe the measures taken to improve profitability.
During the fourth quarter, Honkarakenne initiated a development programme aiming at savings of MEUR 3. The development programme is expected to come into full effect during the third quarter of 2015. As part of the programme, Honkarakenne engaged in co-operation negotiations in November-December. These negotiations resulted in reductions of 17 person-years, which were largely implemented by laying off personnel for an indefinite period.
In 2014, Honkarakenne made strong outlays on the development of detached house collections in Finland. We launched both ready-to-move-in houses and the Healthy House model collection. I believe that these outlays will generate growth for Honkarakenne in the future. A growing number of people want ready-to-move-in houses. Honkarakenne ready-to-move-in Healthy House model collection lifted Honkarakenne to a new level in modern urban housing. Healthy living is in ever-rising demand among customers. Our Healthy House model collection was developed to cater to all the requirements of healthy living – the concept takes into account not only indoor air quality, acoustics and illumination, but also the entire construction process.
As the next step from the Healthy House consept, Honkarakenne implemented a healthy daycare centre in Oulu on a turnkey basis in the fourth quarter. Good indoor air quality is particularly important at daycare centres.
Area development projects continued to develop well in Russia & CIS markets. The Ukrainian situation, the price of oil and strong exchange rate fluctuations currently cause uncertainty in the Russian market and hinder sales forecasts.
Net sales in Global Markets fell short of the previous year. The major factors were the scarcity of project sales compared with 2013 and the measures taken to improve profitability in Central Europe. In addition, in the case of Japan, the unfavourable currency exchange trend and the sales tax hike implemented in early 2014 both weakened net sales.
Honkarakenne launched sales in China, a future growth area, in the first part of the year. The first deliveries to China were made during the latter half. China is a rapidly growing market and I believe there will be rising demand for high-quality, solid timber housing in the future. Wellbeing and a healthy and ecological living environment are global megatrends. Our product range meets these requirements very well. Honkarakenne seeks to take on a major role in developing this segment in China.”
NET SALES
Honkarakenne Group’s net sales for the year 2014 decreased by 6 per cent to MEUR 45.5 (MEUR 48.3).
The Group’s last-quarter net sales in 2014 decreased by 33 per cent to MEUR 11.5 (MEUR 17.0).
Geographical distribution of net sales:
| DEVELOPMENT OF SALES | |||||
|
Distribution of net sales, % |
1-12 /2014 |
1-12 /2013 |
|||
| Finland & Baltics | 48 % | 42 % | |||
| Russia & CIS | 31 % | 27 % | |||
| Global Markets | 20 % | 31 % | |||
| Total | 100 % | 100 % |
| Net sales, MEUR |
10-12 /2014 |
10-12 /2013 |
% change |
1-12 /2014 |
1-12 /2013 |
% change |
| Finland & Baltics | 4.6 | 5.0 | -8 | 22.0 | 20.3 | 8 |
| Russia & CIS | 4.2 | 5.0 | -15 | 14.3 | 12.8 | 11 |
| Global Markets | 2.6 | 7.1 | -63 | 9.3 | 15.2 | -39 |
| Total | 11.5 | 17.0 | -33 | 45.5 | 48.3 | -6 |
Finland & Baltics includes the following countries: Finland, Estonia, Latvia and Lithuania. It includes also Process waste sales for recycling which was reported separately before.
Russia & CIS includes the following countries: Russia, Azerbaijan, Kazakhstan, Ukraine and other CIS countries.
Global Markets includes other countries than above-mentioned.
The Group’s order book stood at MEUR 12.5 at the end of December. In the previous year at the same time period it was MEUR 18.1.
TRENDS IN PROFIT AND PROFITABILITY
The operating loss in 2014 was MEUR -2.2 (MEUR -1.7) and the result before taxes MEUR -2.5 (MEUR -1.7). The result includes a provision of MEUR 0.2 (MEUR 0.6) associated with personnel reductions and efficiency measurements.
The operating loss without non-recurring items in January–December was MEUR -2.0 (MEUR -1.1). This year-on-year change in the operating result without non-recurring items was influenced particularly by both the reduced price level in Finland and the scarcity of project sales in Global Markets.
During the fourth quarter, Honkarakenne initiated a development programme aiming at savings of MEUR 3. The development programme is expected to come into full effect during the third quarter of 2015. In addition modernization investments finalized in 2014 and centralizing operations in Karstula are expected to improve profitability.
FINANCING AND INVESTMENTS
The financial position of the Group was satisfactory at the end of the report period. The equity ratio stood at 37 % (38 %) and net financial liabilities at MEUR 8.2 (MEUR 6.1). MEUR 2.0 (MEUR 3.4) of the financial liabilities carries a 30 % equity ratio covenant term. Group liquid assets totalled MEUR 1.0 (MEUR 3.2). The Group also has a MEUR 8.0 (MEUR 8.0) bank overdraft facility, MEUR 4.2 of which had been drawn on at the end of the report period (MEUR 5.6). Gearing stood at 92 % (57 %).
The Group’s capital expenditure on fixed assets totalled MEUR 0.9 (MEUR 3.7), while the Group’s depreciation amounted to MEUR 2.2 (MEUR 2.3).
PRODUCTS AND MARKETING
In Finland & Baltics, Honkarakenne continued its outlays on increasing sales of detached houses. The major overhaul was the launch of ready-to-move-in solutions and the Healthy House model collection. The Healthy House model collection is Honka's spearhead for growth in the Finnish detached house segment. The Healthy House model collection was developed to cater to all the requirements of healthy living – the concept takes into account not only indoor air quality, acoustics and illumination, but also the entire construction process. In addition, these houses are also available as convenient ready-to-move-in packages. The Healthy House solution has been tested and approved by VTT Technical Research Centre of Finland.
The Healthy House concept was introduced at the Jyväskylä Housing Fair, where it was well-received.
The Lounatuuli model from the detached house collection was voted as Finland's best detached house in a competition on the rakentaja.fi website in early 2014. During the fourth quarter, the Birgitta cafe, delivered by Honkarakenne, was chosen as the Finnish Log Building of the Year.
Honkarakenne ventured into a new business area by delivering a daycare centre in Oulu on a turnkey basis in the fourth quarter. A healthy daycare centre is the logical evolution of Honkarakenne's Healthy House concept.
In Russia & CIS, the company continued to work on area development projects in Russia with a local dealer. In Russia, construction is increasingly focusing on area development projects in which several Honkarakenne projects are implemented in a single area. In addition, the company started up more systematic sales in major cities other than St Petersburg and Moscow.
The Ukrainian crisis, the price of oil and exchange rate fluctuations were reflected in the Russian market, especially in the fourth quarter. Honkarakenne is keeping a close eye on the situation. In spite of the Ukrainian situation, net sales in both Russia and Ukraine saw year-on-year growth.
In Global Markets, net sales fell short of the previous year. The major factors were the scarcity of project sales compared with 2013 and the measures taken to improve profitability in Central Europe. In addition, in the case of Japan, the unfavourable currency exchange trend and the sales tax hike implemented in early 2014 both weakened net sales.
Honkarakenne launched sales in China, a future growth area, in the first part of the year. The first deliveries to China were made during the latter half. China is a rapidly growing market and Honkarakenne believes that there will be rising demand for high-quality, solid timber housing in the future. Wellbeing and a healthy and ecological living environment are global megatrends. Honkarakenne's product range meets these requirements very well. Honkarakenne seeks to take on a major role in developing this segment in China.
RESEARCH AND DEVELOPMENT
In R&D, we continued to develop the ready-to-move-in range and Healthy House model collection in the Finnish detached house market. In addition, the company's R&D continued to focus on the special features of the Chinese market in sales of Honkarakenne's log houses.
In the January–December period, the Group's R&D expenditure totalled MEUR 0.5 (MEUR 0.4), representing 1.0 % of net sales (0.8 %). The Group did not capitalise any development expenditure during the financial year.
STAFF
In terms of person years, the Group employed a total of 146 (185) people in average in 2014, representing a year-on-year decrease of 39.
In 2014 the Group employed 161 (213) people on average. By the end of the year, the Group employed 148 (178) people.
In November-December Honkarakenne concluded negotiations under the act on co-operation within undertakings in Finland and based on these negotiations the company decided on efficiency actions including reduction of 17 person-years which were largely implemented by laying off personnel for an indefinite period. In addition, the company agreed on temporary lay-offs for a maximum of 90 days during March - December 2015 concerning clerical and managerial employees in Finland.
MANAGEMENT
Honkarakenne reorganised its functions at the beginning of December. With this reorganisation, Honkarakenne streamlined its operations with a view to seeking growth and better profitability. Resources were targeted at developing sales and marketing, the importer and dealer network, and the company's collection development. In spite of the personnel reductions that were carried out, Honkarakenne will continue to invest in Russia, CIS and Asia, as the company sees major long-term growth potential in these markets, particularly China.
Reorganization included changes in company’s executive group. Since the beginning of December the new executive group has been Mikko Kilpeläinen, president and CEO, Mika Koivisto, sales area Finland, Pekka Elo, sales area Global Markets, Peter Morinov, sales area Russia and CIS-countries, Tanja Rytkönen, model collections and design, Erja Heiskanen, operations and Mikko Jaskari, finance. President and CEO Mikko Kilpeläinen is personally in charge of company’s product management development. Sami Leinonen left Honkarakenne’s service at the beginning of December.
LONG-TERM INCENTIVE PLAN
In the second quarter of 2013, the Board of Directors decided on a long-term share-based incentive plan for members of the Executive Group. The performance period of the new plan began on 1 January 2013 and will end on 31 December 2016. The potential reward for the performance period is based on the cumulative earnings per share (EPS) for 2013 - 2016 and on the average return on capital employed (ROCE) for 2013 - 2016. Any rewards for the performance period 2013 - 2016 will be paid partly as B shares and partly in cash in 2017. The rewards to be paid on the basis of the performance period will correspond to a total maximum of about 340,000 B shares, including the amount to be paid in cash.
In financial year 2014 the amount of allocated shares was 4,191 (10,484). These allocated shares are recognized as follows: 5 (31) thousand euros employee benefit expenses, 0 (3) thousand euros deduction in taxes and increase in deferred tax assets and 7 (16) thousand euros direct in retained earnings.
HONKARAKENNE OYJ’S 2014 ANNUAL GENERAL MEETING, BOARD OF DIRECTORS, AND AUDITORS
The Annual General Meeting of Honkarakenne Oyj was held at the company’s headquarters in Tuusula on 4 April 2014. The AGM approved the parent company's and the consolidated Financial Statements, and discharged the members of the Board of Directors and the CEO from liability for 2013. The AGM decided not to pay a dividend for the 2013 financial year.
Teijo Pankko and Mauri Saarelainen were re-elected to the Board of Directors. Arto Tiitinen, Anita Saarelainen and Hannu Krook were elected to the Board as new members. At the Board's constituent meeting, Arto Tiitinen was elected Chairman of the Board. Mauri Saarelainen was elected as Deputy Chairman. The Board of Directors decided not to elect any committees from among its members.
PricewaterhouseCoopers Oy, member of the Finnish Institute of Authorised Public Accountants, was re-appointed as auditor of the company, with Maria Grönroos, APA, as chief auditor.
HONKARAKENNE OYJ's DIRECTED ISSUE, OWN SHARES AND BOARD AUTHORISATIONS
On the basis of an authorisation to issue shares granted to the Board of Directors at the Annual General Meeting of 5 April 2013, the Board decided (on 10 January 2014) to arrange a directed issue to Honkarakenne employees. The Board approved a total of 42,451 subscriptions for new Series B shares through the directed issue. The Series B shares subscribed for through the directed issue represent about 0.9 per cent of the total number of Series B shares and the voting rights conferred by them. 62 company employees subscribed for shares through the directed issue. Shares were offered to a total of 146 employees. The total number of Series B shares increased to 4,911,323 shares after the new shares were registered in the Trade Register.
At the end of the financial year, the total number of Honkarakenne Oyj shares entered in the Trade Register amounted to 5,211,419, of which 300,096 were Series A shares and 4,911,323 Series B shares. Each B share carries one (1) vote and each A share carries twenty (20) votes. Hence, Honkarakenne’s shares in aggregate carry a total of 10,913,243 votes. The company's registered share capital is EUR 9,897,936.00.
Honkarakenne has not acquired its own shares during the report period. At the end of the report period, the Group held 364,385 of its Honkarakenne B shares with a total purchase price of EUR 1,381,750.23. These shares represent 6.99 % of the company's all shares and 3.34 % of all votes. The purchase cost has been deducted from shareholders' equity in the consolidated financial statements.
On 4 April 2014, the AGM decided that the Board of Directors will be authorised to acquire a maximum of 400,000 of the company’s own B shares with assets included in the company’s unrestricted equity. In addition, the AGM authorised the Board to decide on a rights issue or bonus issue and on granting special rights to shares referred to in Section 1 of Chapter 10 of the Limited Liability Companies Act in one or more instalments. By virtue of the authorisation, the Board may issue a maximum total of 400,000 new shares and/or relinquish old B shares held by the company, including those shares that can be issued by virtue of special rights. Both authorisations will be valid until 25 March 2015.
CORPORATE GOVERNANCE
Honkarakenne Oyj follows the Limited Liability Companies Act and the Finnish Corporate Governance Code, 1 October 2010, for listed companies issued by the Finnish Securities Market Association. The company's website, www.honka.com, provides more information on the corporate governance systems.
FUTURE OUTLOOK
At the end of December, the Group's order book stood at MEUR 12.5, down 31 % on the corresponding period of the previous year, when it stood at MEUR 18.1. The order book refers to orders whose delivery date falls within the next 24 months. Some orders may include terms and conditions relating to financing or building permits.
FORTHCOMING RISKS AND UNCERTAINTIES
Russia is one of Honkarakenne's major business territories. The Ukrainian crisis, the trend in the price of oil and strong exchange rate fluctuations currently cause instability in the Russian market. This might have major impacts on Honkarakenne's operations. Honkarakenne is keeping a close eye on the development of the Russian situation.
The assessment of amounts in the balance sheet is based on current assessment by the management. If these assessments are changed, this may result in changes to the Group's result.
It is currently more difficult to acquire funding from the financial markets.
REPORTING
This report contains statements that relate to the future, and these statements are based on hypotheses that the company's management hold currently as well as on the decisions and plans that are currently in place. Although the management believes that the hypotheses relating to the future are well-founded, there is no guarantee that the said hypotheses will prove to be correct.
This financial statement release has been drafted in accordance with IAS 34. The principles adhered to in preparing the annual financial statements 2013 also apply to this financial statement release but new and amended IFRS standards and interpretations effective in 2014 have been applied. Amended standards and interpretations effective from the beginning of year 2014 have no bearing on the figures presented for the report period.
The figures have not been examined by the auditor.
EVENTS AFTER THE REVIEW PERIOD
No significant events.
PROPOSAL OF THE BOARD OF DIRECTORS ON THE USE OF PROFIT FUNDS
The parent company has no distributable funds and no funds can be allocated as profits. The parent company posted a MEUR -2.7 loss for the financial year.
The Board of Directors proposes to the Annual General Meeting that no dividend be paid for the financial year ended 31 December 2014.
THE OUTLOOK FOR 2015
According the Honkarakenne’s view net sales may decline in 2015 from previous year due to the situation in Russia. The result before non-recurring items and taxes is estimated to improve due to the development programme initiated by the Group.
GENERAL MEETING
The Annual General Meeting of Honkarakenne Oyj will be held at the company’s headquarters in Tuusula on Friday 17 April 2015 at 2:00 pm.
HONKARAKENNE OYJ
Board of Directors
Further information:
Mikko Kilpeläinen, President and CEO, tel. +358 50 542 5884, mikko.kilpelainen@honka.com or
Mikko Jaskari, CFO, tel. +358 400 535 337, mikko.jaskari@honka.com.
This and previous releases are available for viewing on the company’s website at www.honka.com.
Honkarakenne will publish the Directors’ Report and financial statements for 2014 as well as a separate Corporate Governance Statement on the company’s website at www.honka.com latest in week 13. Interim Reports for 2015 will be published on 7 May 2015, 6 August 2015 and 29 October 2015.
DISTRIBUTION
NASDAQ OMX Helsinki
Key media
Financial Supervisory Authority
www.honka.com
| CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME | ||||
| unaudited | 10-12 /2014 | 10-12 /2013 | 1-12 /2014 | 1-12 /2013 |
| MEUR | ||||
| Net sales | 11.5 | 17.0 | 45.5 | 48.3 |
| Other operating income | 0.1 | 0.1 | 0.5 | 0.4 |
| Change in inventories | -1.8 | -1.0 | -2.1 | 0.9 |
| Materials and services | -6.0 | -10.0 | -29.2 | -30.9 |
| Employee benefit expenses | -2.0 | -3.6 | -8.3 | -10.9 |
| Depreciations and amortisation | -0.6 | -0.4 | -2.2 | -2.3 |
| Impairment | -0.0 | -0.2 | -0.0 | -0.2 |
| Other operating expenses | -1.4 | -1.9 | -6.4 | -6.9 |
| Operating profit/loss | -0.3 | 0.1 | -2.2 | -1.7 |
| Financial income | 0.1 | 0.3 | 0.1 | 0.8 |
| Financial expenses | -0.2 | -0.5 | -0.5 | -0.7 |
| Share of associated companies' result | -0.0 | 0.0 | -0.0 | -0.0 |
| Profit/loss before taxes | -0.4 | -0.1 | -2.5 | -1.7 |
| Taxes | 0.2 | -0.3 | 0.6 | 0.1 |
| Profit/loss for the period | -0.2 | -0.3 | -1.9 | -1.5 |
| Other comprehensive income | ||||
| Translation differences | -0.1 | -0.2 | -0.0 | -0.4 |
|
Total comprehensive income for the period |
-0.3 | -0.5 | -2.0 | -2.0 |
| Result for the period attributable to | ||||
| Equity holders of the parent | -0.2 | -0.3 | -1.9 | -1.5 |
| Non-controlling interest | -0.0 | -0.0 | -0.0 | 0.0 |
| -0.2 | -0.3 | -1.9 | -1.5 | |
| Comprehensive income attributable to | ||||
| Equity holders of the parent | -0.3 | -0.5 | -2.0 | -2.0 |
| Non-controlling interest | -0.0 | -0.0 | -0.0 | 0.0 |
| -0.3 | -0.5 | -2.0 | -2.0 | |
|
Calculated from the result for the period attributable to equity holders of parent Earnings/share (EPS), EUR |
||||
| Basic | -0.04 | -0.07 | -0.40 | -0.32 |
| Diluted | -0.04 | -0.07 | -0.40 | -0.32 |
Honkarakenne Oyj has two series of shares: A shares and B shares, which have different right to dividend. Profit distribution of 0.20 EUR per share will be paid first for B shares, then 0.20 EUR per share for A shares, followed by equal distribution of remaining profit distribution between all shares.
|
CONSOLIDATED BALANCE SHEET Unaudited |
31.12.2014 |
31.12.2013 |
| MEUR | ||
| Assets | ||
| Non-current assets | ||
| Property, plant and equipment | 14.5 | 15.9 |
| Goodwill | 0.1 | 0.1 |
| Other intangible assets | 0.3 | 0.5 |
| Investments in associated companies | 0.3 | 0.3 |
| Receivables | 0.2 | 0.2 |
| Deferred tax assets | 2.1 | 1.5 |
| 17.5 | 18.4 | |
| Current assets | ||
| Inventories | 4.9 | 7.1 |
| Trade and other receivables | 4.5 | 5.2 |
| Cash and bank receivables | 1.0 | 3.2 |
| 10.4 | 15.6 | |
| Total assets | 27.9 | 34.0 |
| Shareholders' equity and liabilities | 31.12.2014 | 31.12.2013 |
|
Equity attributable to equity holders of the parent company |
||
| Share capital | 9.9 | 9.9 |
| Share premium account | 0.5 | 0.5 |
| Fund for invested unrestricted equity | 6.5 | 6.4 |
| Own shares | -1.4 | -1.4 |
| Translation differences | -0.2 | -0.2 |
| Retained earnings | -6.6 | -4.7 |
| 8.7 | 10.6 | |
| Non-controlling interests | 0.2 | 0.2 |
| Total equity | 8.9 | 10.8 |
| Non-current liabilities | ||
| Deferred tax liabilities | 0.0 | 0.1 |
| Provisions | 0.3 | 0.5 |
| Financial liabilities | 7.4 | 7.5 |
| 7.7 | 8.1 | |
| Current liabilities | ||
| Trade and other payables | 8.8 | 12.3 |
| Current tax liabilities | 0.0 | 0.2 |
| Provisions | 0.6 | 0.9 |
| Current financial liabilities | 1.8 | 1.8 |
| 11.3 | 15.1 | |
| Total liabilities | 19.0 | 23.2 |
| Total equity and liabilities | 27.9 | 34.0 |
|
STATEMENT OF CHANGES IN EQUITY abridged Unaudited |
||||||||||||
| EUR thousand | Equity attributable to equity holders of the parent | |||||||||||
| a) | b) | c) | d) | e) | f) | Total | g) | Total equity | ||||
|
Total equity 1.1.2013 |
9898 | 520 | 6828 | 224 | -1382 | -3178 | 12909 | 209 | 13117 | |||
| Profit/loss for the period | -1546 | -1546 | 1 | -1545 | ||||||||
| Translation difference | -421 | -421 | -421 | |||||||||
| Repayment of capital | -384 | -384 | -384 | |||||||||
| Management incentive plan | 16 | 16 | 16 | |||||||||
| Total equity 31.12.2013 | 9898 | 520 | 6444 | -197 | -1382 | -4710 | 10573 | 211 | 10784 | |||
|
Equity attributable to equity holders of the parent |
||||||||||||
| a) | b) | c) | d) | e) | f) | Total | g) | Total equity | ||||
|
Total equity 1.1.2014 |
9898 | 520 | 6444 | -197 | -1382 | -4710 | 10573 | 211 | 10784 | |||
| Profit/loss for the period | -1936 | -1936 | -7 | -1942 | ||||||||
| Translation difference | -18 | -18 | -18 | |||||||||
| Directed share issue | 90 | 90 | 90 | |||||||||
| Management incentive plan | 7 | 7 | 7 | |||||||||
|
Total equity 31.12.2014 |
9898 | 520 | 6534 | -215 | -1382 | -6638 | 8716 | 204 | 8920 | |||
a) Share capital
b) Share premium account
c) Fund for invested unrestricted equity
d) Translation difference
e) Own shares
f) Retained earnings
g) Non-controlling interests
|
CONSOLIDATED STATEMENT OF CASH FLOWS abridged unaudited |
1.1.- 31.12.2014 |
1.1.- 31.12.2013 |
| MEUR | ||
| Cash flow from operating activities | -0.8 | -1.2 |
| Cash flow from investing activities, net | -1.3 | -3.0 |
| Total cash flows from financing activities | -0.2 | 2.6 |
| Share issue | 0.1 | |
| Repayment of capital | -0.4 | |
| Proceeds from borrowings | 3.0 | 5.6 |
| Repayment of borrowings | -3.1 | -2.4 |
| Other financial items | -0.1 | -0.2 |
| Change in cash and cash equivalents | -1.9 | -1.6 |
| Cash and cash equivalents at the beginning of period | 3.2 | 4.8 |
| Cash and cash equivalents at the close of period | 1.0 | 3.2 |
NOTES TO THE REPORT
Accounting policies
This financial statement release has been drafted in accordance with IAS 34. The principles adhered to in preparing the annual financial statements 2013 also apply to this financial statement release but new and amended IFRS standards and interpretations effective in 2014 have been applied. Amended standards and interpretations effective from the beginning of year 2014 have no bearing on the figures presented for the report period.
The figures have not been examined by the auditor.
Honka Management Oy, which is a company established in 2010 by members of company’s Executive Group, is included in the consolidated financial statements due to the terms and conditions of the shareholder agreement concluded between it and Honkarakenne Oyj.
Honkarakenne has three geographical operating segments that have been combined into one segment for reporting purposes. Geographically, sales are divided as follows: Finland & Baltics, Russia & CIS and Global Markets. The internal reporting of the management is in line with IFRS reporting. For this reason, separate reconciliations are not presented.
| Property, plant and equipment | |
| Property, plant and equipment | |
| MEUR | |
| Cost 1.1.2014 | 65.7 |
| Increase | 0.8 |
| Disposals | -0.6 |
| Cost 31.12.2014 | 65.9 |
| Accumulated depreciation 1.1.2014 | -49.8 |
| Translation differences (+/-) | -0.2 |
| Accumulated depreciation of disposals and reclassifications | 0.6 |
| Depreciation for the period | -1.9 |
| Accumulated depreciation 31.12.2014 | -51.4 |
| Carrying amount 1.1.2014 | 15.9 |
| Carrying amount 31.12.2014 | 14.5 |
Non-recurring expenses
The co-operation negotiations that ended in the last quarter and efficiency activities resulted in MEUR 0.2 being recognised as non-recurring expenses for the financial year 2014.
Own shares
Honkarakenne has not acquired its own shares during the report period. At the end of the report period, the Group held 364,385 of its Honkarakenne B shares with a total purchase price of EUR 1,381,750.23. These shares represent 6.99 % of the company's all shares and 3.34 % of all votes. The purchase cost has been deducted from shareholders' equity in the consolidated financial statements.
| Contingent liabilities | ||
| Unaudited | 31.12.2014 | 31.12.2013 |
| MEUR | ||
| For own loans | ||
| - Mortgages | 25,7 | 25,7 |
| - Other quarantees | 2,1 | 2,3 |
| Rental liabilities | 0,4 | 0,6 |
| Leasing liabilities | 0,4 | 0,2 |
| Nominal values of forward exchange contracts | 1,7 | 1,7 |
| Derivative contracts | 0,3 | 0,4 |
Events with related parties
The Group’s related parties consist of subsidiaries and associated companies; the company's management and any companies in which they exert influence; and those involved in the Saarelainen shareholder agreement and any companies controlled by them. The management personnel considered to be related parties comprise the Board of Directors, President & CEO, and the company's Executive Group. The pricing of goods and services in transactions with related parties conforms to market-based pricing.
During the report period, ordinary business transactions with related parties were made as follows: the sales to the related parties were EUR 381 thousand and the purchases from the related parties were EUR 497 thousand. In 2010 and 2011, Honkarakenne Oyj granted long-term loans totalling MEUR 0.9 to Honka Management Oy, which is owned by the company’s senior management.
| KEY INDICATORS | ||||||
| 1-12 | 1-12 | |||||
| Unaudited | 2014 | 2013 | ||||
| Earnings/share (EPS) | euro | -0.40 | -0.32 | |||
| Return on equity | % | -20 | -13 | |||
| Equity ratio | % | 37 | 38 | |||
| Shareholders equity/share | euro | 1.80 | 2.20 | |||
| Net financial liabilities | MEUR | 8.2 | 6.1 | |||
| Gearing | % | 92 | 57 | |||
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| Gross investments | MEUR | 0.9 | 3.7 | |||
| % of net sales | 2 | 8 | ||||
| Order book | MEUR | 12.5 | 18.1 | |||
| Personnel in person-years, average | Staff | 81 | 104 | |||
| Workers | 66 | 82 | ||||
| Total | 146 | 185 | ||||
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Calculation of key indicators |
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| Profit for the period attributable to equity holders of parent | ||||||
| Earnings/share (EPS) | ----------------------------------------------- | |||||
| Average number of outstanding shares | ||||||
| Result before taxes – taxes | ||||||
| Return on equity % | ----------------------------------------------- | x 100 | ||||
| Total equity, average | ||||||
| Total equity | ||||||
| Equity ratio, % | ----------------------------------------------- | x 100 | ||||
| Balance sheet total - advances received | ||||||
| Net financial liabilities | Financial liabilities – cash and cash equivalents | |||||
| Financial liabilities – cash and cash equivalents | ||||||
| Gearing, % | ------------------------------------------- | x 100 | ||||
| Total equity | ||||||
| Shareholders’ equity | ||||||
| Shareholders equity/share | ------------------------------------------------ | |||||
| Number of shares outstanding at the close of period | ||||||