LASSILA & TIKANOJA PLC INTERIM REPORT 27 July 2010 8.00 am
LASSILA & TIKANOJA PLC INTERIM REPORT 1 JANUARY - 30 JUNE 2010
- Net sales for the second quarter EUR 149.0 million (EUR 147.1 million);
operating profit EUR 8.8 million (EUR 14.9 million); operating profit excluding
non-recurring items EUR 11.8 million (EUR 14.8 million); earnings per share EUR
0.14 (EUR 0.26)
- Net sales for January-June EUR 302.9 million (EUR 293.5 million); operating
profit EUR 15.4 million (EUR 24.9 million); operating profit excluding
non-recurring items EUR 19.6 million (EUR 26.0 million); earnings per share EUR
0.25 (EUR 0.42)
- Full-year net sales and operating profit excluding non-recurring items are
expected to remain at the 2009 level.
GROUP NET SALES AND FINANCIAL PERFORMANCE
Second quarter
Lassila & Tikanoja's net sales for the second quarter increased by 1.3% to EUR
149.0 million (EUR 147.1 million). Operating profit was EUR 8.8 million (EUR
14.9 million), representing 5.9% (10.1%) of net sales, and operating profit
excluding non-recurring items was EUR 11.8 million (EUR 14.8 million). Earnings
per share were EUR 0.14 (EUR 0.26).
The healthy demand for commissioned property maintenance assignments boosted net
sales, resulting in a slight growth from the comparison period. However,
profitability declined from the previous year in all divisions, particularly in
Renewable Energy Sources (L&T Biowatti) due to the weak demand for wood-based
fuels.
A non-recurring expense of EUR 3.0 million was recognised in the second quarter
for the discontinuation of L&T Biowatti's wood pellet business.
January-June
Six-month net sales amounted to EUR 302.9 million (EUR 293.5 million), showing
an increase of 3.2%. Operating profit was EUR 15.4 million (EUR 24.9 million),
representing 5.1% (8.5%) of net sales. Operating profit excluding non-recurring
items fell to EUR 19.6 million (EUR 26.0 million). Earnings per share were EUR
0.25 (EUR 0.42).
Net sales grew due to commissioned property maintenance assignments. Demand for
services and secondary raw materials began to normalise, which helped raise the
net sales of the Environmental Services division to the previous year's level.
L&T Biowatti and the joint venture L&T Recoil recorded losses, which taxed the
performance in the first half.
Costs recognised in the first half included non-recurring restructuring costs of
EUR 1.2 million and an EUR 3.0 million cost associated with the discontinuation
of the wood pellet business.
FINANCIAL SUMMARY
--------------------------------------------------------------------------------
| | 4-6/ | 4-6/ | Chang | 1-6/ | 1-6/ | Change | 1-12/ |
| | 2010 | 2009 | e | 2010 | 2009 | % | 2009 |
| | | | % | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Net sales, EUR million | 149. | 147. | 1.3 | 302. | 293.5 | 3.2 | 582.3 |
| | 0 | 1 | | 9 | | | |
--------------------------------------------------------------------------------
| Operating profit | 11.8 | 14.8 | -20.2 | 19.6 | 26.0 | -24.7 | 51.3 |
| excluding | | | | | | | |
| non-recurring items, | | | | | | | |
| EUR million* | | | | | | | |
--------------------------------------------------------------------------------
| Operating profit, EUR | 8.8 | 14.9 | -41.1 | 15.4 | 24.9 | -38.1 | 50.3 |
| million | | | | | | | |
--------------------------------------------------------------------------------
| Operating margin, % | 5.9 | 10.1 | | 5.1 | 8.5 | | 8.6 |
--------------------------------------------------------------------------------
| Profit before tax, EUR | 7.8 | 13.6 | -42.5 | 13.4 | 21.9 | -38.8 | 45.0 |
| million | | | | | | | |
--------------------------------------------------------------------------------
| Earnings per share, | 0.14 | 0.26 | -46.2 | 0.25 | 0.42 | -40.5 | 0.85 |
| EUR | | | | | | | |
--------------------------------------------------------------------------------
| EVA, EUR million | 1.2 | 6.4 | | 0.1 | 8.4 | | 16.5 |
--------------------------------------------------------------------------------
* Breakdown of operating profit excluding non-recurring items is presented below
the division reviews.
NET SALES AND FINANCIAL PERFORMANCE BY DIVISION
Environmental Services
Second quarter
The division's net sales for the second quarter increased by 2.0% to EUR 75.6
million (EUR 74.1 million). Operating profit was EUR 10.1 million (EUR 10.9
million), and operating profit excluding non-recurring items was EUR 10.1
million (EUR 10.9 million).
Net sales from domestic business grew somewhat from the previous year due to the
recovery of operating rates in the industry and the recovery of the
construction. Waste volumes picked up from the comparison period, and secondary
raw material demand and prices also improved. The additional costs arising from
the ERP system implementation project taxed the quarter's performance.
Demand for industrial process cleaning and hazardous waste services perked up as
expected after a period of sluggish demand in the first quarter. New agreements
were signed with industrial clients and existing agreements were renewed
successfully.
Operational reliability of L&T Recoil's production improved during the second
quarter. The price of the plant's end-product, base oil, has been rising,
following the crude oil price hikes. Nonetheless, operations made a loss in the
second quarter.
In April, Lassila & Tikanoja plc and EcoStream Oy signed a preliminary agreement
on a business arrangement based on which L&T will sell its share of L&T Recoil
to EcoStream. At the end of the quarter, the time given for the transaction was
extended and the arrangement is now intended to be completed by the end of
September 2010, on condition that, among others, the financing and the share
issue needed by EcoStream for the transaction will be completed. Due to the
preliminary agreement, L&T Recoil's assets are recognised as held-for-sale
assets and related liabilities.
Net sales and profitability of the division's international operations remained
on the previous year's level.
January-June
The net sales of Environmental Services for January-June decreased by 0.5% to
EUR 140.2 million (EUR 141.0 million). Operating profit was EUR 14.5 million
(EUR 17.4 million), and operating profit excluding non-recurring items was EUR
14.9 million (EUR 18.4 million).
The expected increase in waste volumes in the first half could be attributed to
the recovery of operating rates in the industry and the recovery of the
construction industry. Similarly, secondary raw material demand and prices
strengthened in comparison to the previous year. Heavy snowfall in the winter
strained waste management production efficiency in the first half, and
contributed to the decrease in demand for industrial services. Net sales and
profitability in the comparison period were boosted by major project-based
assignments.
The joint venture L&T Recoil's re-refinery suffered from technical problems in
the first half. Production restart-up was delayed until the beginning of the
second quarter, which had a considerable negative impact on the division's
profitability.
The second stage of the Kerava recycling plant's investment programme proceeded
as planned. A new combined recycling plant for construction waste and trade and
industrial waste will be brought on line in the second half of the year, which
will significantly raise the recovery rate of the waste processed at the Kerava
plant.
Net sales and profitability for international operations remained at the
previous year's level even though the uncertainty of the Latvian economy has
been a challenge for business development.
Net sales and profitability for environmental products declined.
Property and Office Support Services
Second quarter
The net sales of Property and Office Support Services (property maintenance and
cleaning services) grew by 5.3% to EUR 63.7 million (EUR 60.5 million) in the
second quarter. Operating profit was EUR 3.3 million (EUR 4.3 million), and
operating profit excluding non-recurring items was EUR 3.3 million (EUR 4.3
million).
The division's net sales growth could be attributed to successful sales of
commissioned property maintenance assignments and to the great work load in
damage repair services. Net sales from cleaning services in Finland remained at
the previous year's level. Although operating profit from domestic operations
fell due to the higher cost of subcontracting, a strict fixed cost control
helped retain healthy profitability.
Net sales from international operations remained at the previous year's level
but overall result was slightly in the red. New sales were successful in Sweden
but in Latvia the economic instability hampered new sales.
January-June
The January-June net sales of Property and Office Support Services totalled EUR
135.2 million (EUR 121.7 million); an increase of 11.1%. Operating profit was
EUR 7.1 million (EUR 7.7 million), and operating profit excluding non-recurring
items was EUR 7.4 million (EUR 7.9 million).
The division's net sales growth can almost entirely be attributed to the large
number of commissioned property maintenance assignments, due to the
exceptionally cold and snowy winter. Both product lines were able to renew their
contracts and new partnerships with insurance companies were signed. In domestic
operations, profitability was slightly lower than in the comparison period due
to the additional costs associated with commissioned assignments.
Net sales from international operations in the first half were at the comparison
period's level. New sales continued to be successful in Sweden in the second
quarter. Nonetheless, the result from international operations was negative. An
EUR 0.7 million credit loss was recognised for the first half in Russian
operations.
Renewable Energy Sources
Second quarter
Second quarter net sales of Renewable Energy Sources (L&T Biowatti) were down by
17.7% to EUR 12.1 million (EUR 14.7 million). The division recorded an operating
loss of EUR 3.9 million (EUR 0.3 million), and an operating loss excluding
non-recurring items of EUR 0.9 million (a profit of EUR 0.2 million).
The division's net sales and profitability declined due to the weak demand for
wood-based fuels. The low prices of competing fuels (peat, coal and oil) had a
negative effect on demand. Furthermore, the prices of emission rights continued
to be low.
A decision was made to discontinue the wood pellet business due to the
unfavourable market conditions and the poor availability of raw materials. A
non-recurring expense of EUR 3.0 million was recognised for the discontinuation.
January-June
The Renewable Energy Sources division's net sales for January-June amounted to
EUR 32.2 million (EUR 35.8 million), showing a decrease of 9.9%. Operating loss
totalled EUR 4.8 million (a profit of EUR 0.4 million), and operating loss
excluding non-recurring items was EUR 1.7 million (a profit of EUR 0.8 million).
The demand for L&T Biowatti's biofuels and their competitiveness declined in the
first half due to the low prices of emission rights and fossil fuels (peat, coal
and oil). Profitability improvement has been the division's key priority.
BREAKDOWN OF OPERATING PROFIT EXCLUDING NON-RECURRING ITEMS
--------------------------------------------------------------------------------
| EUR million | 4-6/ | 4-6/ | 1-6/ | 1-6/ | 1-12/ |
| | 2010 | 2009 | 2010 | 2009 | 2009 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Operating profit | 8.8 | 14.9 | 15.4 | 24.9 | 50.3 |
--------------------------------------------------------------------------------
| Non-recurring items: | | | | | |
--------------------------------------------------------------------------------
| Discontinuation of wood | 3.0 | | 3.0 | | |
| pellet production of L&T | | | | | |
| Biowatti | | | | | |
--------------------------------------------------------------------------------
| Discontinuation of soil | | | | | -0.4 |
| washing services | | | | | |
--------------------------------------------------------------------------------
| Restructuring costs | | | 1.2 | 1.2 | 1.6 |
--------------------------------------------------------------------------------
| Closure of wood pellet plant | | 0.4 | | 0.4 | 0.3 |
| in Luumäki | | | | | |
--------------------------------------------------------------------------------
| Refund of supplementary | | -0.5 | | -0.5 | -0.5 |
| insurance fund of former | | | | | |
| Lassila & Tikanoja | | | | | |
--------------------------------------------------------------------------------
| Operating profit excluding | 11.8 | 14.8 | 19.6 | 26.0 | 51.3 |
| non-recurring items | | | | | |
--------------------------------------------------------------------------------
FINANCING
Cash flows from operating activities amounted to EUR 30.4 million (EUR 36.2
million). EUR 2.1 million was released from the working capital (EUR 2.3 million
tied up). Liquid assets at the end of the period amounted to EUR 14.4 million
(EUR 23.4 million).
The assets and liabilities of the joint venture L&T Recoil are presented as
held-for-sale assets and related liabilities, which is why interest-bearing
liabilities fell to EUR 112.6 million (EUR 152.8 million). The interest-bearing
liabilities associated with L&T Recoil amounted to EUR 20.9 million and are not
included in the interest-bearing liabilities referred to above. The equity ratio
was 43.8% (41.6%) and the gearing rate 47.5 (64.9). Net interest-bearing
liabilities amounted to EUR 98.2 million, showing a decrease of EUR 31.2 million
from the comparison period and EUR 18.1 million from the turn of the year.
Of the EUR 50 million commercial paper programme, EUR 4.0 million (EUR 0.0
million) was in use. The EUR 15.0 million committed limit, renewed in June for
two years, was not in use, as was the case a year earlier.
Net finance costs in January-June amounted to EUR 2.0 million which is EUR 0.9
million below the amount of the comparison period. Net finance costs were 0.7%
(1.0%) of net sales. The decrease resulted from the decrease in the
interest-bearing liabilities and the decline in the interest rate level. In
January-June, a total of EUR -0.2 million (EUR -0.3 million) arising from the
changes in the fair values of interest rate swaps to which hedge accounting
under IAS 39 is applied was recognised in other comprehensive income, after tax.
The average interest rate of loans (with interest rate hedging) was 3.3%.
Long-term loans totalling EUR 10.1 million will mature by the end of the year.
DIVIDEND
The Annual General Meeting held on 31 March 2010 resolved on a dividend of EUR
0.55 per share. The dividend, totalling EUR 21.3 million, was paid to the
shareholders on 14 April 2010.
CAPITAL EXPENDITURE
Capital expenditure totalled EUR 16.1 million (EUR 24.5 million) in
January-June. The most significant construction project is the Kerava combined
recycling plant, which is scheduled to be completed in autumn 2010.
In the second quarter, the property maintenance services business of
Kiinteistöpalvelu Oy Hollola was acquired into Property and Office Support
Services. The net sales of the acquired business totalled EUR 1.6 million.
PERSONNEL
In January-June, the average number of employees converted into full-time
equivalents was 7,522 (8,039). The total number of full-time and part-time
employees at the end of the period was 9,420 (9,524). Of them 7,496 (7,409)
people worked in Finland and 1,924 (2,115) people in other countries.
NEW DIVISIONS
The company's internal reporting, as well as the segments reported externally,
were changed to reflect the new divisions at the beginning of 2010. The
financial reporting segments are Environmental Services, Property and Office
Support Services and Renewable Energy Sources (L&T Biowatti).
As of 1 July 2010, Property and Office Support Services was divided into two
divisions: Property Maintenance, and Cleaning and Office Support Services. The
company's financial reporting segments reflect the new divisions as of 1 July
2010.
SHARE AND SHARE CAPITAL
Traded volume and price
The volume of trading excluding the shares held by the company in Lassila &
Tikanoja plc shares on NASDAQ OMX Helsinki from January through June 2010 was
3,392,446, which is 8.8% (17.2%) of the average number of outstanding shares.
The value of trading was EUR 50.8 million (EUR 74.6 million). The trading price
varied between EUR 12.94 and EUR 16.20. The closing price was EUR 13.20. The
company holds 60,758 own shares. The market capitalisation excluding the shares
held by the company was EUR 511.3 million (EUR 496.2 million) at the end of the
period.
Share capital and number of shares
The company's registered share capital amounts to EUR 19,399,437, and the number
of outstanding shares to 38,738,116 shares. In January-June, the average number
of shares excluding the shares held by the company totalled 38,759,356.
Share option scheme 2005
In 2005, 600,000 share option rights were issued, each entitling its holder to
subscribe for one share of Lassila & Tikanoja plc. In the beginning of the
exercise period, 37 key persons held 200,000 2005C options. L&T Advance Oy, a
wholly-owned subsidiary of Lassila & Tikanoja plc, holds 30,000 2005C options
and these options will not be exercised. The exercise period for the 2005A has
ended on 29 May 2009 and for the 2005B options on 31 May 2010.
The exercise price for the 2005C options is EUR 26.87. The exercise period for
2005C options is 2 November 2009 to 31 May 2011.
As a result of the exercise of the outstanding 2005 share options, the number of
shares may increase by a maximum of 200,000 new shares, which is 0.5% of the
current number of shares. The 2005C options have been listed on NASDAQ OMX
Helsinki since 2 November 2009.
Share option scheme 2008
In 2008, 230,000 share option rights were issued, each entitling its holder to
subscribe for one share of Lassila & Tikanoja plc. 36 key persons hold 193,000
options and L&T Advance Oy 37,000 options.
The exercise price is EUR 16.27. The exercise price of the share options shall,
as per the dividend record date, be reduced by the amount of dividend which
exceeds 70% of the profit per share for the financial period to which the
dividend applies. However, only such dividends whose distribution has been
agreed upon after the option pricing period and which have been distributed
prior to the share subscription are deducted from the subscription price. The
exercise price shall, however, always amount to at least EUR 0.01. The exercise
period will be from 1 November 2010 to 31 May 2012.
As a result of the exercise
of the outstanding 2008 share options, the number of shares may increase by a
maximum of 193,000 new shares, which is 0.5% of the current number of shares.
Share-based incentive programme
Lassila & Tikanoja plc's Board of Directors decided on 24 March 2009 on a
share-based incentive programme. The programme includes three earnings periods
one year each, of which the first one began on 1 January 2009 and the last one
ends on 31 December 2011. The basis for the determination of the reward is
decided annually. Rewards to be paid for the year 2010 will be based on the EVA
result of Lassila & Tikanoja group. They will be paid partly as shares and
partly in cash. The proportion paid in cash will cover taxes arising from the
reward. The programme covers 25 persons.
A maximum total of 180,000 Lassila & Tikanoja plc shares may be paid out on the
basis of the programme. The shares will be obtained in public trading, and
therefore the incentive programme will have no diluting effect on the share
value.
Shareholders
At the end of the financial period, the company had 8,439 (6,927) shareholders.
Nominee-registered holdings accounted for 10.3% (8.8%) of the total number of
shares.
Authorisation for the Board of Directors
The Annual General Meeting held on 31 March 2010 authorised Lassila & Tikanoja
plc's Board of Directors to make decisions on the repurchase of the company's
own shares using the company's unrestricted equity and on the issuance of these
shares. Shares will be repurchased otherwise than in proportion to the existing
shareholdings of the company's shareholders in public trading on the NASDAQ OMX
Helsinki Ltd at the market price quoted at the time of the repurchase.
The Board of Directors is authorised to repurchase and transfer a maximum of
500,000 company shares, which is 1.3% of the total number of shares. The
repurchase authorisation will be effective for 18 months and the share issue
authorisation for four years. These authorisations revoke the authorisation for
the repurchase of the company's own shares and the authorisation to issue shares
issued by the Annual General Meeting 2009.
The Board of Directors is not authorised to launch a convertible bond or share
option rights.
Own shares
At the end of the period, the company held 60,758 of its own shares,
representing 0.2% of all shares and votes. Based on the authorisation given by
the Annual General Meeting, the company repurchased 80,000 shares in the period
from 17 May to 2 June 2010 at a total acquisition cost of EUR 1.1 million. On 25
May 2010, the Board of Directors decided on a directed bonus issue involving the
issue, in which a total of 49,242 shares held by the company were issued to the
company's key personnel on 4 June 2010, as a part of the rewards for the year
2009 of the share-based incentive programme.
RESOLUTIONS BY THE ANNUAL GENERAL MEETING
The Annual General Meeting of Lassila & Tikanoja plc, which was held on 31 March
2010, adopted the financial statements for the financial year 2009 and released
the members of the Board of Directors and the President and CEO from liability.
The AGM resolved that a dividend of EUR 0.55, a total of EUR 21.3 million, as
proposed by the Board of Directors, be paid for the financial year 2009. The
dividend payment date was resolved to be 14 April 2010.
The Annual General Meeting confirmed the number of the members of the Board of
Directors six. The following Board members were re-elected to the Board until
the end of the following AGM: Heikki Bergholm, Eero Hautaniemi, Matti Kavetvuo,
Hille Korhonen and Juhani Lassila. Miikka Maijala was elected as a new member
for the same term.
PricewaterhouseCoopers Oy, Authorised Public Accountants, were elected auditors.
The Annual General Meeting approved the Board's proposals to amend article 11 of
the Articles of Association and to authorise the Board of Directors to
repurchase the company's own shares and to issue shares.
The resolutions of the Annual General Meeting were announced in more detail in a
stock exchange release on 31 March 2010.
BOARD OF DIRECTORS
The members of the Board of Directors are Heikki Bergholm, Eero Hautaniemi,
Matti Kavetvuo, Hille Korhonen, Juhani Lassila and Miikka Maijala. In its
constitutive meeting the Board elected Matti Kavetvuo as Chairman of the Board
and Juhani Lassila as Vice Chairman.
From among its members, the Board elected Juhani Lassila as Chairman and Eero
Hautaniemi and Miikka Maijala as members of the audit committee.
The Board decided to establish a remuneration committee. From among its members,
the Board elected Matti Kavetvuo as Chairman and Heikki Bergholm and Hille
Korhonen as members of the remuneration committee.
SUMMARY OF STOCK EXCHANGE RELEASES PURSUANT TO ARTICLE 7, CHAPTER 2 OF THE
SECURITIES MARKETS ACT
In a release published on 25 January 2010, the company announced that it has
concluded statutory employer-employee negotiations which began on 8 December
2009. As a result of these negotiations, L&T will reduce 110 salaried employee
positions in Finland. The reductions will be realised partly through natural
attrition. The reductions form part of the measures currently undertaken in
order to reduce fixed costs and to adapt business activities to meet current and
future market situation.
In a release published on 1 April 2010, the company announced that, as of 1 July
2010, Property and Office Support Services are to be divided into two divisions:
Property Maintenance, and Cleaning and Office Support Services. The company's
financial reporting segments will be changed to reflect the new divisions as of
1 July 2010.
In a release published on 29 April 2010, the company announced that Lassila &
Tikanoja plc and EcoStream Oy have signed a preliminary agreement on a business
arrangement based on which Lassila & Tikanoja will sell its 50 percent holding
in the joint venture L&T Recoil Oy to EcoStream, a co-owner. The transaction
related to the preliminary agreement was intended to be completed by the end of
June 2010. In a release published on 22 June 2010, the company announced that
the time given to the transaction has been extended and the transaction is
intended to be completed by the end of September 2010.
In a release published on 26 May 2010, the company announced that L&T Biowatti
Oy, a subsidiary of Lassila & Tikanoja plc, will discontinue its wood pellet
business. Construction of a pellet plant in Suonenjoki, Finland, is almost
completed but market situation and difficulties in availability of suitable raw
material have postponed the start-up of the plant. The construction of the plant
will not be completed.
NEAR-TERM UNCERTAINTIES
In Property and Office Support Services, the number of commissioned assignments
may fall despite the economic recovery. Rapid fluctuations in demand for
services purchased by the industry may hamper the planning and implementation of
work.
If the operating rate target set for L&T Recoil's production is not reached,
this will have a negative impact on the Environmental Services division's
performance. Its performance could also be adversely affected by the potential
fall in the price of crude oil, since the price of base oil follows crude oil
price developments with a slight delay.
Low prices of fossil fuels such as coal, oil and peat undermines the
competitiveness of L&T Biowatti's wood-based fuels. Similarly, the low wholesale
price of electricity and low price of emission rights will weaken demand.
Intensifying competition and changes in legislation in Latvia may prove
detrimental to the profitability of the waste management business.
More detailed information on L&T's risks and risk management is available in the
Annual Report, in the Board of Directors' Report and in the consolidated
financial statements.
PROSPECTS FOR THE REST OF THE YEAR
In the Environmental Services division, the market outlook for waste management
and recycling services for the rest of the year has improved. Waste volumes are
expected to grow. The demand for secondary raw materials and the market prices
are expected to recover moderately. In light of the rising operating rates in
the industry, it is fair to assume that the demand for hazardous waste and
process cleaning services will grow.
An approximately one-month maintenance shut-down at the joint venture L&T
Recoil's plant scheduled to start in August will improve the plant's reliability
and raise the degree of processing. The plant was not yet in operation in the
second half last year, and the joint venture recorded significant losses.
The markets for Property and Office Support Services are expected to remain
unchanged towards the year-end. However, in the current economic conditions the
competitive situation will remain fierce.
The demand for L&T Biowatti's wood-based fuels is estimated to remain weak.
Furthermore, low prices of emission rights and fossil fuels will undermine the
competitiveness of renewable fuels. While the planned government support
measures to increase the use of renewable fuels are expected to have a positive
impact in the long term, they will not affect this year's performance.
Full-year net sales and operating profit excluding non-recurring items are
expected to remain at the same level as in 2009.
CONDENSED FINANCIAL STATEMENTS 1 JANUARY - 30 JUNE 2010
CONSOLIDATED INCOME STATEMENT
--------------------------------------------------------------------------------
| EUR 1000 | 4-6/ | 4-6/ | 1-6/ | 1-6/ | 1-12/ |
| | 2 | 2009 | 2010 | 2009 | 2009 |
| | 010 | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Net sales | 149 | 147 094 | 302 916 | 293 526 | 582 306 |
| | 014 | | | | |
--------------------------------------------------------------------------------
| Cost of sales | -131 | -126 049 | -271 068 | -255 279 | -505 |
| | 123 | | | | 699 |
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| Gross profit | 17 891 | 21 045 | 31 848 | 38 247 | 76 607 |
--------------------------------------------------------------------------------
| Other operating income | 703 | 993 | 1 021 | 1 344 | 2 425 |
--------------------------------------------------------------------------------
| Selling and marketing | -3 470 | -3 697 | -6 939 | -7 766 | -14 636 |
| costs | | | | | |
--------------------------------------------------------------------------------
| Administrative expenses | -2 888 | -2 851 | -5 943 | -5 532 | -11 705 |
--------------------------------------------------------------------------------
| Other operating expenses | -849 | -624 | -1 964 | -1 442 | -2 427 |
--------------------------------------------------------------------------------
| Impairment | -2 632 | | -2 632 | | |
--------------------------------------------------------------------------------
| Operating profit | 8 755 | 14 866 | 15 391 | 24 851 | 50 264 |
--------------------------------------------------------------------------------
| Finance income | 310 | 418 | 648 | 829 | 1 290 |
--------------------------------------------------------------------------------
| Finance costs | -1 227 | -1 651 | -2 618 | -3 747 | -6 528 |
--------------------------------------------------------------------------------
| Profit before tax | 7 838 | 13 633 | 13 421 | 21 933 | 45 026 |
--------------------------------------------------------------------------------
| Income tax expense | -2 105 | -3 612 | -3 557 | -5 812 | -11 881 |
--------------------------------------------------------------------------------
| Profit for the period | 5 733 | 10 021 | 9 864 | 16 121 | 33 145 |
--------------------------------------------------------------------------------
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| Attributable to: | | | | | |
--------------------------------------------------------------------------------
| Equity holders of the | 5 726 | 10 016 | 9 853 | 16 120 | 33 140 |
| company | | | | | |
--------------------------------------------------------------------------------
| Minority interest | 7 | 5 | 11 | 1 | 5 |
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Earnings per share for profit attributable to the equity holders of the company:
--------------------------------------------------------------------------------
| Basic earnings per share, | 0.14 | 0.26 | 0.25 | 0.42 | 0.85 |
| EUR | | | | | |
--------------------------------------------------------------------------------
| Diluted earnings per | 0.14 | 0.26 | 0.25 | 0.42 | 0.85 |
| share, EUR | | | | | |
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CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
--------------------------------------------------------------------------------
| EUR 1000 | 4-6/ | 4-6/ | 1-6/ | 1-6/ | 1-12/ |
| | 2010 | 2009 | 2010 | 2009 | 2009 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Profit for the period | 5 733 | 10 | 9 864 | 16 121 | 33 145 |
| | | 021 | | | |
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| Other comprehensive income, | | | | | |
| after tax | | | | | |
--------------------------------------------------------------------------------
| Hedging reserve, change in fair | -31 | 99 | -226 | -335 | -343 |
| value | | | | | |
--------------------------------------------------------------------------------
| Current available-for-sale | | | | | |
| investments | | | | | |
--------------------------------------------------------------------------------
| Gains in the period | -56 | -80 | -56 | -7 | -21 |
--------------------------------------------------------------------------------
| Current available-for-sale | -56 | -80 | -56 | -7 | -21 |
| investments | | | | | |
--------------------------------------------------------------------------------
| Currency translation | 345 | 287 | 1 152 | -22 | 324 |
| differences | | | | | |
--------------------------------------------------------------------------------
| Other comprehensive income, | 258 | 306 | 870 | -364 | -40 |
| after tax | | | | | |
--------------------------------------------------------------------------------
| Total comprehensive income, | 5 991 | 10 | 10 734 | 15 757 | 33 105 |
| after tax | | 327 | | | |
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| Attributable to: |
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| Equity holders of the company | 5 974 | 10 | 10 691 | 15 766 | 33 020 |
| | | 318 | | | |
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| Minority interest | 17 | 9 | 43 | -9 | 85 |
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CONSOLIDATED STATEMENT OF FINANCIAL POSITION
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| EUR 1000 | 6/2010 | 6/2009 | 12/2009 |
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| | | | |
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| ASSETS | | | |
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| | | | |
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| Non-current assets | | | |
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| Intangible assets | | | |
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| Goodwill | 112 768 | 115 495 | 113 771 |
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| Customer contracts arising from | 5 499 | 6 454 | 6 232 |
| acquisitions | | | |
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| Agreements on prohibition of competition | 10 766 | 12 250 | 11 641 |
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| Other intangible assets arising from | 2 212 | 4 188 | 3 194 |
| business acquisitions | | | |
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| Other intangible assets | 11 694 | 13 218 | 13 579 |
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| | 142 939 | 151 605 | 148 417 |
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| Property, plant and equipment | | | |
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| Land | 4 356 | 4 015 | 4 015 |
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| Buildings and constructions | 43 698 | 61 872 | 72 072 |
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| Machinery and equipment | 105 882 | 114 982 | 110 817 |
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| Other | 83 | 79 | 81 |
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| Prepayments and construction in progress | 14 741 | 20 303 | 14 666 |
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| | 168 760 | 201 251 | 201 651 |
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| Other non-current assets | | | |
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| Available-for-sale investments | 525 | 522 | 525 |
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| Finance lease receivables | 3 992 | 4 859 | 4 425 |
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| Deferred tax assets | 2 663 | 1 376 | 2 147 |
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| Other receivables | 527 | 705 | 726 |
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| | 7 707 | 7 462 | 7 823 |
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| Total non-current assets | 319 406 | 360 318 | 357 891 |
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| Current assets | | | |
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| Inventories | 23 492 | 21 894 | 32 842 |
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| Trade and other receivables | 81 623 | 76 039 | 77 702 |
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| Prepayments | 2 050 | 1 873 | 370 |
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| Available-for-sale investments | 5 995 | 16 477 | 18 484 |
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| Cash and cash equivalents | 8 446 | 6 943 | 9 099 |
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| Assets held for sale | 34 612 | | |
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| Total current assets | 156 218 | 123 226 | 138 497 |
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| TOTAL ASSETS | 475 624 | 483 544 | 496 388 |
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| EUR 1000 | 6/2010 | 6/2009 | 12/2009 |
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| | | | |
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| EQUITY AND LIABILITIES | | | |
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| | | | |
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| Equity | | | |
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| Equity attributable to equity holders of | | | |
| the company | | | |
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| Share capital | 19 399 | 19 399 | 19 399 |
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| Share premium reserve | 50 673 | 50 673 | 50 673 |
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| Other reserves | -2 246 | -3 319 | -3 084 |
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| Retained earnings | 128 545 | 116 515 | 116 874 |
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| Profit for the period | 9 853 | 16 120 | 33 140 |
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| | 206 224 | 199 388 | 217 002 |
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| Minority interest | 290 | 153 | 247 |
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| Total equity | 206 514 | 199 541 | 217 249 |
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| Liabilities | | | |
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| Non-current liabilities | | | |
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| Deferred tax liabilities | 32 723 | 32 660 | 33 622 |
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| Retirement benefit obligations | 610 | 680 | 671 |
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| Provisions | 2 493 | 1 993 | 2 100 |
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| Borrowings | 90 011 | 116 181 | 120 969 |
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| Other liabilities | 1 948 | 1 340 | 1 510 |
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| | 127 785 | 152 854 | 158 872 |
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| Current liabilities | | | |
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| Borrowings | 22 610 | 36 666 | 22 890 |
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| Trade and other payables | 91 115 | 91 864 | 94 130 |
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| Derivative liabilities | 1 204 | 1 066 | 1 073 |
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| Tax liabilities | 22 | 1 242 | 2 119 |
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| Provisions | 134 | 311 | 55 |
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| Liabilities related to assets held for | 26 240 | | |
| sale | | | |
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| | 141 325 | 131 149 | 120 267 |
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| Total liabilities | 269 110 | 284 003 | 279 139 |
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| TOTAL EQUITY AND LIABILITIES | 475 624 | 483 544 | 496 388 |
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CONSOLIDATED STATEMENT OF CASH FLOWS
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| EUR 1000 | 6/2010 | 6/2009 | 12/2009 |
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| Cash flows from operating activities | | | |
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| Profit for the period | 9 864 | 16 121 | 33 145 |
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| Adjustments | | | |
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| Income tax expense | 3 557 | 5 812 | 11 881 |
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| Depreciation, amortisation and impairment | 23 022 | 19 815 | 40 334 |
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| Finance income and costs | 1 970 | 2 918 | 5 238 |
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| Gain on sale of shares | | | -70 |
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| Other | 159 | 258 | 1 809 |
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| Net cash generated from operating | 38 572 | 44 924 | 92 337 |
| activities before change in working | | | |
| capital | | | |
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| Change in working capital | | | |
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| Change in trade and other receivables | -3 101 | -4 327 | -4 654 |
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| Change in inventories | 5 735 | -3 074 | -14 022 |
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| Change in trade and other payables | -508 | 5 065 | 6 689 |
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| Change in working capital | 2 126 | -2 336 | -11 987 |
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| Interest paid | -1 667 | -4 074 | -7 511 |
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| Interest received | 479 | 1 035 | 1 505 |
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| Income tax paid | -9 073 | -3 363 | -8 156 |
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| Net cash from operating activities | 30 437 | 36 186 | 66 188 |
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| Cash flows from investing activities | | | |
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| Acquisition of subsidiaries and | -723 | -320 | -1 747 |
| businesses, net of cash acquired | | | |
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| Proceeds from sale of subsidiaries and | | 197 | 197 |
| businesses, net of sold cash | | | |
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| Purchases of property, plant and | -13 405 | -24 530 | -42 735 |
| equipment and intangible assets | | | |
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| Proceeds from sale of property, plant and | 688 | 1 196 | 4 328 |
| equipment and intangible assets | | | |
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| Purchases of available-for-sale | -3 | -48 | -54 |
| investments | | | |
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| Change in other non-current receivables | 202 | -12 | -13 |
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| Proceeds from sale of available-for-sale | | 25 | 7 |
| investments | | | |
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| Dividends received | | 1 | 1 |
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| Net cash used in investing activities | -13 241 | -23 491 | -40 016 |
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| Cash flows from financing activities | | | |
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| Change in short-term borrowings | 4 230 | 3 441 | -12 044 |
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| Proceeds from long-term borrowings | | 24 000 | 43 000 |
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| Repayments of long-term borrowings | -12 411 | -21 511 | -34 388 |
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| Dividends paid | -21 301 | -21 318 | -21 318 |
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| Repurchase of own shares | -1 125 | -356 | -356 |
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| Net cash generated from financing | -30 607 | -15 744 | -25 106 |
| activities | | | |
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| EUR 1000 | 6/2010 | 6/2009 | 12/2009 |
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| Net change in liquid assets | -13 411 | -3 049 | 1 066 |
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| Liquid assets at beginning of period | 27 583 | 26 517 | 26 517 |
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| Effect of changes in foreign exchange | 272 | -38 | 28 |
| rates | | | |
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| Change in fair value of current | | -10 | -28 |
| available-for-sale investments | | | |
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| Liquid assets at end of period | 14 444 | 23 420 | 27 583 |
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Liquid assets
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| EUR 1000 | 6/2010 | 6/2009 | 12/2009 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Cash and cash equivalents | 8 449 | 6 943 | 9 099 |
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