2012-05-08 07:00:00 CEST
2012-05-08 07:00:19 CEST
REGULATED INFORMATION
HKScan Oyj - Interim report (Q1 and Q3)
HKScan Group’s interim report 1 January – 31 March 2012: The performance improvements in HKScan's other market areas did not compensate difficulties in Sweden
HKScan Corporation INTERIM REPORT
8 May 2012 at 8:00 AM
HKScan Group's interim report 1 January - 31 March 2012:
The performance improvements in other market areas did not compensate
difficulties in HKScan's market area in Sweden
- HKScan's net sales in January-March 2012 totalled EUR 606.1 million (EUR
592.7 m in the corresponding quarter of 2011), growing by 2.3 percent.
Eliminating changes in currency rates, growth stood at 3.2 percent.
- Group EBIT came in at EUR -0.6 million (EUR 1.4 million) and was slightly
negative due to the difficulties experienced by the business in Sweden in the
early part of the year.
- Performance in the Group's other market areas in Finland, the Baltics,
Denmark and Poland was according to plan.
- Market position remains for the most part strong in all the Group's market
areas. In Sweden, increased volumes of meat sold under private labels and
growth in imports have weakened the outlook.
- At the end of March HKScan signed a five-year EUR 250 million secured
multi-currency credit facility agreement.
- Net financial expenses were EUR -7.9 million (EUR -5.2 m). Higher loan
margins were the main reason for the rise.
- HKScan announced in early April the launch of a development programme to be
implemented until the end of 2013. The aim of the programme, which covers
Finland, Sweden, Denmark and the Baltics, is to achieve annual performance
improvements exceeding EUR 20 million and considerable reductions in invested
capital.
- Due to the weakened outlook for the business in Sweden, there is a risk that
the Group's EBIT for 2012 will come out below the level of 2011. Previously it
was estimated that the EBIT for 2012 will be better than in 2011.
HKSCAN GROUP
(EUR million) Q1/2012 Q1/2011 2011
---------------------------------------------------
---------------------------------------------------
Net sales 606.1 592.7 2 491.3
---------------------------------------------------
EBIT -0.6 1.4 39.6
---------------------------------------------------
- EBIT margin, % -0.1 0.2 1.6
---------------------------------------------------
Profit/loss before taxes -7.7 -3.3 11.3
---------------------------------------------------
Earnings per share, EUR -0.09 -0.06 0.18
---------------------------------------------------
GROUP OVERVIEW: JANUARY-MARCH 2012
The HKScan Groups' business in the first quarter developed as planned in
Finland, Denmark, the Baltics and Poland. Business in Sweden, on the other
hand, faced major challenges in the period under review due to the higher than
foreseen prices of and poor availability of beef and pork. The production of
Swedish pork and beef continued clearly to fall, purchase prices rose and
slaughtering volumes in Sweden remained low. Moreover, the strong Swedish krona
has increased meat imports and made it difficult to raise the price of products
based on Swedish meat raw material. The amount of meat sold under private
labels, too, has continued to grow.
HKScan has launched a development programme to be implemented until the end of
2013. The aim is to achieve annual performance improvements exceeding EUR 20
million and considerable reduction in invested capital. The main focus is on
the management of production and the product offering in response to demand as
well as on variable and fixed costs and working capital. The programme also
includes the tightening of the Group structure, revision of the management
model and more efficient utilization of Group synergies. The programme covers
the Group's operations in Finland, Sweden, Denmark and the Baltics. Longer-term
strategic alternatives will also be explored in order to develop the business
in Sweden.
At the end of March, HKScan signed a EUR 250 million secured multi-currency
credit facility agreement. The loan facility comprises a EUR 100 million
five-year amortizing term loan and a EUR 150 million five-year credit limit.
The arrangement will refinance the part of the syndicated loan facility
established in 2007 which matures in 2013. The facility will extend the average
loan period of the Group's loan stock.
HKScan's CEO changed when Matti Perkonoja, who headed the company since 2009,
retired at the end of February. The new CEO, Hannu Kottonen, assumed his post
on 1 March 2012.
MARKET AREA: FINLAND
(EUR million) Q1/2012 Q1/2011 2011
-----------------------------------------
-----------------------------------------
Net sales 197.6 188.0 812.4
-----------------------------------------
EBIT 2.7 -0.6 12.1
-----------------------------------------
- EBIT margin, % 1.4 -0.3 1.5
-----------------------------------------
In Finland, net sales in January-March grew to EUR 197.6 million (EUR 188.0 m).
EBIT for the period under review strengthened to EUR 2.7 million (EUR -0.6 m)
and was 1.4 percent (-0.3%) of net sales.
Performance in Finland was better than the general trend in the sector in the
early part of the year. Market standing strengthened, especially in cold cuts.
In Finland, the market's most popular cold cut is the ultra thin ham, HK Ohuen
ohut Ylikypsä Saunapalvikinkku, retailed in a 300 g pack. (Source: Nielsen,
PanelTrack). There has been an upturn in the share of convenience foods. Among
new products, HK Rapeseed pork nuggets have been well received in the market.
(Source: HK market monitoring assessment).
In consumer packed pork, HK Rapeseed pork has in just over a year taken nearly
20 percent of the market share. In Finland, the Group has been the market
leader in pork since the early part of 2012. (Source: Nielsen, PanelTrack
2012).
The contract reform concerning meat procurement begun in autumn 2011 has
progressed according to plan. The Group announced in the autumn that it would
be beginning a transition to more controlled contract production in its pork
chain in Finland. The new long-term contract policy will improve the
manageability and controllability of the chain.
A significant local cooperation agreement was concluded at the production plant
in Mikkeli in order to preserve jobs in the food industry. The contract is for
two years and under the agreement the need to adjust the number of staff,
discussed in employer-employee negotiations earlier this year, will be managed
through layoffs, job changes or training for new tasks, instead of by letting
employees go.
In February, Anne Mere, MBA, was appointed head of HKScan's market area of
Finland as managing director of HKScan Finland Oy. Ms Mere is also responsible
for HKScan's market area of the Baltics.
MARKET AREA: BALTICS
(EUR million) Q1/2012 Q1/2011 2011
-----------------------------------------
-----------------------------------------
Net sales 40.5 39.3 173.3
-----------------------------------------
EBIT 0.7 0.9 9.8
-----------------------------------------
- EBIT margin, % 1.8 2.2 5.6
-----------------------------------------
In the Baltics, net sales in January-March totalled EUR 40.5 million (EUR 39.3
m), up nearly 3 percent. EBIT for the period under review decreased slightly,
coming in at EUR 0.7 million (EUR 0.9 m) and amounting to 1.8 percent (2.2%) of
net sales.
The price of meat raw material in the Baltics has risen. Energy costs are up
too. At the same time, consumers' purchasing behaviour has been affected by the
weakening of households' buying power, which has led to growth in demand for
cheaper products and tightening competition. Despite the challenges, business
in the Baltics has nevertheless adjusted to the market conditions well.
The market area has begun to build an organization for the entire Baltics with
a view to achieving synergy benefits and cost savings.
In the Baltics, the most important investments involved energy savings and
primary production at Rakvere and the programme for restructuring production at
Tallegg.
In conjunction with Anne Mere's appointment in February, Teet Soorm was
appointed as the new managing director of AS Rakvere Lihakombinaat. He is also
continuing as managing director of AS Tallegg and AS Ekseko and reports to
director Anne Mere.
MARKET AREA: SWEDEN
(EUR million) Q1/2012 Q1/2011 2011
-------------------------------------------
-------------------------------------------
Net sales 246.9 252.3 1 045.7
-------------------------------------------
EBIT -5.5 0.3 17.2
-------------------------------------------
- EBIT margin, % -2.2 0.1 1.6
-------------------------------------------
In Sweden, net sales in January-March totalled EUR 246.9 million (EUR 252.3 m).
Net sales decreased compared with the previous year both in euro and krona.
EBIT in the period under review came in at EUR -5.5 million (EUR 0.3 m) and was
-2.2 percent of net sales (0.1%).
Performance in the quarter was particularly affected by the decline in pork and
beef primary production in Sweden, as well as by the high procurement price of
Swedish beef and lower beef slaughter volumes. The strong Swedish krona has
significantly increased meat imports and made it difficult to raise the price
of products based on Swedish meat raw material, especially in retail. Price
increases and cost adjustment have been made in Sweden, but the measures have
been inadequate so far both in terms of timing and scope. A further challenge
in retail is the growing share of private labels.
Svensk Rapgris, Swedish rapeseed pork, was launched to customers in the HoReCa
sector during the period under review. By the end of the summer, the concept
will be expanded to retail. Hansa brand processed meats have been launched on
the market during the early part of the year.
In the area of primary production, the changes in subsidy policy for beef
production have weakened the profitability of production. This has further
weakened the availability of Swedish beef, thus making room for exports.
Consumer demand in beef has increased as a whole.
Measures to improve efficiency with a view to rectifying the situation have
been instigated. Longer-term strategic alternatives for business development
will also be explored regarding the business in Sweden.
MARKET AREA: DENMARK
(EUR million) Q1/2012 Q1/2011 2011
-----------------------------------------
-----------------------------------------
Net sales 57.8 57.5 228.1
-----------------------------------------
EBIT 0.3 -0.5 -3.7
-----------------------------------------
- EBIT margin, % 0.5 -0.9 -1.6
-----------------------------------------
In Denmark, net sales in January-March totalled EUR 57.8 million (EUR 57.5 m).
EBIT for the period under review came in at EUR 0.3 million (EUR -0.5 m) and
was 0.5 percent (-0.9%) of net sales.
In the early part of the year, raw material prices decreased slightly in
Denmark. The market areas of Denmark and Sweden are focusing especially on
fresh poultry products. A new product range has been launched during the period
on the Swedish market.
The Malaysian export market, which re-opened at the end of 2011, has picked up
during the period. Measures to increase fresh production at the Vinderup and
Skovsgaard facilities have continued as planned.
In January Thomas Olander, BSc (Econ & Bus Admin), was appointed managing
director of Rose Poultry A/S. He is responsible for the business in Denmark and
reports to Denis Mattsson, who is responsible for both the Swedish and Danish
market areas on HKScan's Management Team.
MARKET AREA: POLAND
(EUR million) Q1/2012 Q1/2011 2011
-----------------------------------------
*)
-----------------------------------------
Net sales 80.4 70.5 298.9
-----------------------------------------
EBIT 3.4 3.0 12.7
-----------------------------------------
- EBIT margin, % 4.3 4.2 4.2
-----------------------------------------
*) The figures refer to HKScan's share (50 %) of the Sokolów Group's figures.
Poland's net sales in January-March totalled EUR 80.4 million (EUR 70.5 m), up
by 14.1 percent. The driving force behind the growth in net sales was, among
other factors, strengthening of the Sokolów brand in Poland.
EBIT in the period under review came in at EUR 3.4 million (EUR 3.0 m) and was
4.3 percent of net sales (4.2%).
Sales in Poland progressed according to the targets, although meat raw material
prices have risen and price competition is tough. Modern and own retail sales
developed steadily.
In Poland major changes are going on in the meat sector and it is affecting
small and medium-sized companies specializing in slaughter and cutting the
most. Large and diverse companies such as Sokolów have coped with the situation
better.
Investments relating to production improvement, the beef slaughtering line at
the Tarnów plant and Sokolów Podlaski's cold cuts plant, have progressed
according to plan.
CHANGES IN ORGANIZATION
Thomas Olander, BSc (Econ & Bus Admin), was appointed managing director of
HKScan's Danish subsidiary, Rose Poultry A/S, in January. He was previously
managing director of Pärsons Sverige AB, which is part of the Group. Mr Olander
is responsible for HKScan's business operations in Denmark and is also
continuing as managing director of Kreatina A/S and of Scan Foods Ltd in the
UK. Mr Olander reports to Denis Mattsson, managing director of Scan AB, who is
responsible for both the Swedish and Danish market areas on HKScan's Management
Team.
In February Anne Mere, MBA, managing director of HKScan's Estonian subsidiary
AS Rakvere Lihakombinaat, was appointed head of the market areas of Finland and
the Baltics. She also became a member of HKScan's Management Team. Ms Mere is
responsible for, besides HKScan's market area of the Baltics, the market area
of Finland. HK Ruokatalo's managing director Jari Leija no longer works in the
Group.
Along with Ms Mere's appointment, Teet Soorm was appointed managing director of
AS Rakvere Lihakombinaat. He is also continuing as managing director of AS
Tallegg and AS Ekseko.
When Matti Perkonoja retired at the end of February 2012, Hannu Kottonen
assumed the post of CEO of HKScan on 1 March 2012.
HKSCAN'S MANAGEMENT TEAM
HKScan's Management Team consists of Hannu Kottonen, CEO; Irma Kiilunen, CFO;
Anne Mere, director responsible for the market areas of Finland and the
Baltics; Denis Mattsson, director responsible for the market areas of Sweden
and Denmark; Sirpa Laakso, HR director and Markku Suvanto, administrative and
legal director.
INVESTMENTS
The Group's production-related gross investments in January-March 2012 totalled
EUR 19.8 million (EUR 15.1 m) and were divided in the market areas as follows:
(EUR million)
Q1/2012 Q1/2011 2011
-----------------------------------------------
Finland 3.3 4.7 17.3
-----------------------------------------------
Baltics 2.4 2.9 12.4
-----------------------------------------------
Sweden 2.9 2.5 8.9
-----------------------------------------------
Denmark 5.5 1.1 7.8
-----------------------------------------------
Poland 1) 5.7 3.9 14.5
-----------------------------------------------
Total 19.8 15.1 61.0
-----------------------------------------------
1) HKScan's share (50%) of Sokolów investments.
In Finland, the investments concerned repair and maintenance of the production
lines. In Sweden, the investments in improving the processes at Kristianstad
and Linköping continued and Skara invested in the Svensk Rapgris, Swedish
rapeseed pork, project. In Denmark, the investments involved improvement of
Rose Poultry's production processes. In the market area of the Baltics, the
main investments involved energy savings and primary production at Rakvere as
well the programme for restructuring production at Tallegg. In Poland, the
investment in the beef slaughtering line at the Tarnów plant was completed. The
improvement of the Sokolów Podlaski production facility progressed as planned
to deployment in April.
FINANCING
The Group's interest-bearing debt at the end of March stood at EUR 527.9
million (EUR 509.5 m). Gross interest-bearing debt at the turn of the year was
EUR 504.2 million. The growth in debt compared with the situation both a year
earlier and at the turn of the year is attributable to the tying up of working
capital and investments in the first quarter.
Group net financial expenses in the period under review totalled EUR -7.9
million (EUR -5.2 m). Net financial expenses rose compared with the previous
year due to higher debt, higher margins on loans and non-recurring financing
arrangement expenses.
Untapped credit facilities at 31 March 2012 stood at EUR 200.2 million (EUR
189.4 m). In addition, the Group had other untapped overdraft and other
facilities of EUR 26.4 million (EUR 49.1 m). The EUR 200 million commercial
paper programme had been drawn in the amount of EUR 130.5 million (EUR 58.0 m).
At the end of March, the Group signed a EUR 250 million secured multi-currency
credit facility agreement with a Nordic banking group. The loan facility
comprises a EUR 100 million five-year amortizing term loan and a EUR 150
million five-year credit limit. The arrangement will refinance the part of the
syndicated loan facility established in 2007 which matures in 2013. The new
facility will extend the average loan period of the Group's loan stock from 1.8
years to 3.8 years.
The equity ratio at the end of March was 33.1 percent (34.4%). The equity ratio
at the turn of the year was 33.6 percent.
SHARES
At the end of March, the HKScan Group's share capital stood at EUR 66 820
528.10. The Group's total number of shares issued, 55 026 522, was divided into
two share series as follows: A Shares, 49 626 522 (90.19% of the total number
of shares) and K Shares 5 400 000 (9.81%). The A Shares are quoted on the
NASDAQ OMX Helsinki. The K Shares are held by LSO Osuuskunta (4 735 000 shares)
and Sveriges Djurbönder ek.för. (665 000 shares) and are not listed. The
company held 53 734 A Shares as treasury shares.
HKScan's market capitalization at the end of March 2012 stood at EUR 293.8
million. It breaks down as follows: Series A shares had a market value of EUR
265.0 million and the unlisted Series K shares a calculational market value of
EUR 28.8 million.
In January-March 2012, a total of 2 390 022 of the company's shares with a
total value of EUR 14 003 005 were traded. The highest price quoted in the
period under review was EUR 6.40 and the lowest EUR 5.23. The middle price was
EUR 5.90. At the end of March, the closing price was EUR 5.34.
At the end of March 2012, foreign shareholders and nominee-registered
shareholders held 20.3 percent of the company's shares.
HKScan has in place a market making agreement with FIM Pankkiiriliike Oy which
meets the requirements of NASDAQ OMX's Liquidity Providing (LP) operation.
BOARD OF DIRECTORS' AUTHORIZATIONS
During January-March 2012, the Board did not exercise the authorizations
received from the Annual General Meeting (AGM) on 27 April 2011. The new
authorizations granted to the Board by the AGM are described in the paragraph
“Events taking place after 31 March 2012.
EMPLOYEES
In the first three months of 2012, HKScan, excluding Sokolów in Poland, had an
average workforce of 7 913 employees (8 227).
The number of employees in Finland has increased mainly due to the intake of
outsourced cutting operations. In Sweden, Denmark and the Baltics, the numbers
of employees have decreased as a consequence of efficiency programmes.
The average number of employees in each market area was as follows:
Q1/2012 Q1/2011 2011
--------------------------------
Finland 2 621 2 524 2 750
--------------------------------
Baltics 1 783 1 904 1 881
--------------------------------
Sweden 2 690 2 882 2 789
--------------------------------
Denmark 819 917 867
--------------------------------
Total 7 913 8 227 8 287
--------------------------------
In addition, the Sokolów Group employed during the first quarter an average of
6 142 (5 877) persons. In 2011 the average number of personnel was 6 191.
At 31 March the number of employees, excluding Sokolów in Poland, stood at 7
950 (8 250).
Analysis of employees by market area at 31 March is as follows:
31.3.2012 31.3.2011 31.12.2011
-----------------------------------------
Finland 2 696 2 558 2 568
-----------------------------------------
Baltics 1 744 1 888 1 803
-----------------------------------------
Sweden 2 676 2 894 2 704
-----------------------------------------
Denmark 834 910 807
-----------------------------------------
Total 7 950 8 250 7 882
-----------------------------------------
Additionally, the Sokolów Group had 6 332 (6 025) employees at the end of the
period under review. At the end of 2011 the corresponding number was 6 175.
RISKS AND UNCERTAINTY FACTORS IN THE NEAR FUTURE
The most significant uncertainty factors in the HKScan Group's business involve
price trends and availability of local raw material as well as to the adequacy
and timing of increases in the selling prices of the products. Market
area-specific uncertainty factors have to do with the implementation and
completion of the business development programmes.
Challenges in the global economic situation will continue. Major fluctuation in
the Group's central currencies and higher interest rates may affect the Group's
competitiveness, net sales, earnings and balance sheet. Changes in demand
attributable to the financial situation such as, for example, growing
unemployment, may occur in the Group's market areas or its export markets.
These may affect the Group's net sales and earnings.
Any unforeseeable authorities procedures may affect the company's business in
its export markets.
The possibility of animal diseases can never be fully excluded in the food
industry's raw meat supplies.
EVENTS TAKING PLACE AFTER THE END OF THE REVIEW PERIOD
(1) At the beginning of April, HKScan reported that performance in the first
quarter would remain in the red due to the difficulties of the business in
Sweden. At the same time, the launch of a development programme covering the
Group's operations in Finland, Sweden, Denmark and the Baltics was announced.
The programme will last until the end of 2013 and aims to achieve annual
performance improvements exceeding EUR 20 million and considerable reductions
in invested capital. The matter has been discussed earlier in this interim
report.
(2) The Annual General Meeting of HKScan Corporation held on 25 April 2012 in
Helsinki adopted the parent company's and consolidated financial statements and
discharged the members of the Board of Directors and the CEO from liability for
the year 2011.
The Annual General Meeting resolved that a dividend of EUR 0.17 per share be
paid for 2011 in accordance with the proposal of the Board of Directors. In
addition, the AGM resolved on the annual remuneration and remuneration for
meeting attendance for Board members and the chairs of the committees.
Juha Kylämäki, Niels Borup, Tero Hemmilä and Henrik Treschow were re-elected to
the Board, and Gunilla Aschan and Teija Andersen were elected as new members.
At the organization meeting held after the AGM, the Board re-elected Juha
Kylämäki as chairman and Niels Borup as deputy chairman.
Authorized Public Accountants PricewaterhouseCoopers Oy, with APA Johan
Kronberg as principal auditor, and APA Petri Palmroth were appointed as
auditors. The deputy auditors are APA Mika Kaarisalo and APA Jari Viljanen.
The AGM authorized the Board to decide on an issue of shares, option rights as
well as other special rights entitling to shares, on acquiring and/or accepting
as pledge treasury A Shares and on the transfer of treasury acquired for the
company. All the above mentioned authorizations will be effective until 30 June
2013.
The proposals of the Board and its Nomination and Audit Committees approved by
the AGM have been published in full in the stock exchange release of 21 March
2012, and they are also available on the company's website at www.hkscan.com.
FUTURE OUTLOOK
Consumer demand for meat is expected to remain fairly steady in the Group's
domestic markets and to grow slightly in Finland.
The prolonged challenges concerning structures of value chains and production
volumes are affecting the controllability and predictability of the sector. The
Group will improve its profitability by raising selling prices and through the
controlled adjustment of procurement volumes alongside development programmes.
Despite the actions, it will take longer than anticipated to stabilize the
situation in Sweden.
New guidance: Due to the weakened outlook for the business in Sweden, there is
a risk that the Group's EBIT for 2012 will come out below the level of 2011.
Previous guidance: The Group's EBIT for 2012 will be better than in 2011.
CONSOLIDATED FINANCIAL STATEMENTS 1 JANUARY - 31 MARCH 2012
CONSOLIDATED INCOME STATEMENT
(EUR million)
Q1/2012 Q1/2011 2011
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
NET SALES 606.1 592.7 2 491.3
--------------------------------------------------------------------------------
Operating income and expenses -588.4 -573.5 -2 380.5
--------------------------------------------------------------------------------
Share of associates' results -0.1 0.2 1.1
--------------------------------------------------------------------------------
Depreciation and impairment -18.1 -18.0 -72.3
--------------------------------------------------------------------------------
EBIT -0.6 1.4 39.6
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Financial income 1.4 2.6 7.4
--------------------------------------------------------------------------------
Financial expenses -9.4 -7.8 -38.3
--------------------------------------------------------------------------------
Share of associates' results 0.8 0.6 2.5
PROFIT/LOSS BEFORE TAXES -7.7 -3.3 11.3
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Income taxes 2.5 0.7 1.0
--------------------------------------------------------------------------------
PROFIT/LOSS FOR THE PERIOD -5.2 -2.7 12.2
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
PROFIT/LOSS FOR THE PERIOD ATTRIBUTABLE TO:
--------------------------------------------------------------------------------
Equity holders of the parent -5.1 -3.1 10.1
--------------------------------------------------------------------------------
Non-controlling interests -0.1 0.4 2.1
--------------------------------------------------------------------------------
Total -5.2 -2.7 12.2
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Earnings per share calculated on profit attributable to equity holders of
the parent:
---------------------------------------------------------------------------
EPS, undiluted, continuing operations, EUR/share -0.09 -0.06 0.18
--------------------------------------------------------------------------------
EPS, diluted, continuing operations, EUR/share -0.09 -0.06 0.18
--------------------------------------------------------------------------------
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
1 JANUARY - 31 MARCH
(EUR million)
Q1/2012 Q1/2011 31.12.2011
-----------------------------------------------------------------------
Profit/loss for the period -5.2 -2.7 12.2
-----------------------------------------------------------------------
-----------------------------------------------------------------------
OTHER COMPREHENSIVE INCOME (after taxes):
-----------------------------------------------------------------------
Exchange differences on 4.2 1.1 -2.5
translating foreign operations
-----------------------------------------------------------------------
Cash flow hedging 0.6 2.7 -7.4
-----------------------------------------------------------------------
Revaluation 0.1 0.0 0.0
-----------------------------------------------------------------------
TOTAL OTHER COMPREHENSIVE 5.0 3.8 -9.8
INCOME
-----------------------------------------------------------------------
-----------------------------------------------------------------------
TOTAL COMPREHENSIVE INCOME -0.2 1.1 2.4
FOR THE PERIOD
-----------------------------------------------------------------------
-----------------------------------------------------------------------
TOTAL COMPREHENSIVE INCOME
FOR THE PERIOD ATTRIBUTABLE TO:
-----------------------------------------------------------------------
Equity holders of the parent -0.2 0.6 0.3
-----------------------------------------------------------------------
Non-controlling interests -0.0 0.5 2.1
-----------------------------------------------------------------------
Total -0.2 1.1 2.4
-----------------------------------------------------------------------
CONSOLIDATED BALANCE SHEET
(EUR million)
Note 31.3.201 31.3.201 31.12.201
2 1 1
--------------------------------------------------------------------------------
ASSETS
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
NON-CURRENT ASSETS
--------------------------------------------------------------------------------
Intangible assets 1. 76.6 76.8 76.6
--------------------------------------------------------------------------------
Goodwill 2. 101.3 100.2 101.0
--------------------------------------------------------------------------------
Tangible assets 3. 524.8 534.7 516.5
--------------------------------------------------------------------------------
Shares in associates 30.0 28.0 29.9
--------------------------------------------------------------------------------
Trade and other receivables 32.2 27.0 31.1
--------------------------------------------------------------------------------
Available-for-sale investments 13.3 12.5 13.0
--------------------------------------------------------------------------------
Deferred tax asset 24.6 14.4 21.1
--------------------------------------------------------------------------------
NON-CURRENT ASSETS 802.7 793.7 789.2
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
CURRENT ASSETS
--------------------------------------------------------------------------------
Inventories 4. 200.9 187.1 190.2
--------------------------------------------------------------------------------
Trade and other receivables 228.1 231.6 223.8
--------------------------------------------------------------------------------
Income tax receivable 2.1 2.3 1.5
--------------------------------------------------------------------------------
Other financial assets 0.4 0.4 0.4
--------------------------------------------------------------------------------
Cash and bank 38.0 48.3 48.0
--------------------------------------------------------------------------------
CURRENT ASSETS 469.4 469.7 463.8
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
ASSETS 1 272.1 1 263.4 1 253.0
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
EQUITY AND LIABILITIES
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
EQUITY
--------------------------------------------------------------------------------
Share capital 5. 66.8 66.8 66.8
--------------------------------------------------------------------------------
Share premium reserve 73.4 73.3 73.4
--------------------------------------------------------------------------------
Treasury shares 0.0 0.0 0.0
--------------------------------------------------------------------------------
Fair value reserve and other reserves 153.9 157.3 153.2
--------------------------------------------------------------------------------
Translation differences 2.3 0.6 -1.9
--------------------------------------------------------------------------------
Retained earnings 112.8 123.8 117.9
--------------------------------------------------------------------------------
Equity attributable to equity holders of 409.1 421.8 409.3
the parent
--------------------------------------------------------------------------------
Non-controlling interests 11.8 11.2 12.2
--------------------------------------------------------------------------------
EQUITY 421.0 433.0 421.5
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
NON-CURRENT LIABILITIES
--------------------------------------------------------------------------------
Deferred tax liability 37.4 37.6 36.9
--------------------------------------------------------------------------------
Non-current interest-bearing liabilities 336.4 380.7 333.5
--------------------------------------------------------------------------------
Non-current non-interest bearing 2.8 13.2 3.0
liabilities
--------------------------------------------------------------------------------
Non-current provisions 0.7 1.7 0.6
--------------------------------------------------------------------------------
Pension obligations 3.1 3.1 3.1
--------------------------------------------------------------------------------
NON-CURRENT LIABILITIES 380.4 436.2 377.1
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
CURRENT LIABILITIES
--------------------------------------------------------------------------------
Current interest-bearing liabilities 191.5 128.8 170.6
--------------------------------------------------------------------------------
Trade and other payables 278.6 262.0 282.9
--------------------------------------------------------------------------------
Income tax liability -0.1 2.5 0.1
--------------------------------------------------------------------------------
Current provisions 0.8 0.8 0.7
--------------------------------------------------------------------------------
CURRENT LIABILITIES 470.8 394.2 454.4
--------------------------------------------------------------------------------
------------------------------------------------------------ ----------
EQUITY AND LIABILITIES 1 272.1 1 263.4 1 253.0
--------------------------------------------------------------------------------
STATEMENT OF CHANGES IN CONSOLIDATED EQUITY
(EUR million)
1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11.
--------------------------------------------------------------------------------
EQUITY 66.8 73.4 -13.9 143.5 23.5 -1.9 0.0 117.9 409.3 12.2 421.5
AT
01.01.12
--------------------------------------------------------------------------------
Result -5.1 -5.1 -0.1 -5.2
for
the
financial
period
--------------------------------------------------------------------------------
Transl. 4.2 4.2 0.0 4.2
diff.
--------------------------------------------------------------------------------
Cash flow 0.6 0.6 0.6
hedging
--------------------------------------------------------------------------------
Revaluat. 0.1 0.1 0.1
--------------------------------------------------------------------------------
Total 0.6 0.1 4.2 -5.1 -0.2 -0.0 -0.2
compreh.
income
for the
period
--------------------------------------------------------------------------------
Share- 0.0 0.0
based
compens.
expense
--------------------------------------------------------------------------------
Other 0.0 0.0
change
--------------------------------------------------------------------------------
Direct 0.0 0.0
recognit.
in
retained
earnings
--------------------------------------------------------------------------------
Transfers 0.0 0.0
between
items
--------------------------------------------------------------------------------
Share 0.0 0.0
issue
--------------------------------------------------------------------------------
Purchase 0.0 0.0
of
treasury
shares
--------------------------------------------------------------------------------
Increase 0.0 0.0
in
holdings
in
subs.
--------------------------------------------------------------------------------
Dividend 0.0 -0.3 -0.3
distribut
.
--------------------------------------------------------------------------------
EQUITY 66.8 73.4 -13.3 143.5 23.7 2.3 0.0 112.8 409.1 11.8 421.0
AT
31.03.12
--------------------------------------------------------------------------------
1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11.
--------------------------------------------------------------------------------
EQUITY 66.8 73.4 -6.5 143.5 17.4 0.6 0.0 124.5 419.6 11.1 430.6
AT
01.01.11
--------------------------------------------------------------------------------
Result -3.1 -3.1 0.4 -2.7
for
the
financial
period
--------------------------------------------------------------------------------
Transl. 0.0 0.0 -0.2 0.0 1.2 1.1 0.0 1.1
diff.
--------------------------------------------------------------------------------
Cash flow 2.7 2.7 2.7
hedging
--------------------------------------------------------------------------------
Total 0.0 2.7 -0.2 0.0 -1.9 0.6 0.5 1.1
compreh.
income
for the
period
--------------------------------------------------------------------------------
Share- 0.0 0.0
based
compens.
expense
--------------------------------------------------------------------------------
Other 0.4 0.4 0.4
change
--------------------------------------------------------------------------------
Direct 1.2 1.2 1.2
recogn.
retained
earnings
--------------------------------------------------------------------------------
Transfers 0.0 0.0
between
items
--------------------------------------------------------------------------------
Share 0.0 0.0
issue
--------------------------------------------------------------------------------
Purchase 0.0 0.0
of
treasury
shares
--------------------------------------------------------------------------------
Increase 0.0 0.0
in
holdings
in
subsid.
--------------------------------------------------------------------------------
Dividend 0.0 -0.3 -0.3
distribut
.
--------------------------------------------------------------------------------
EQUITY 66.8 73.3 -3.8 143.5 17.6 0.6 0.0 123.8 421.8 11.2 433.0
AT
31.03.11
--------------------------------------------------------------------------------
COLUMNS: 1. Share capital, 2. Share premium reserve, 3. Revaluation reserve, 4.
Reserve for invested unrestricted equity (RIUE), 5. Other reserves, 6.
Translation differences, 7. Treasury shares, 8. Retained earnings, 9. Equity
holders of the parent, 10. Non-controlling interests, 11. Total
CASH FLOW STATEMENT
(EUR million)
Q1/2012 Q1/2011 2011
--------------------------------------------------------------------------------
Operating activities
--------------------------------------------------------------------------------
EBIT -0.6 1.4 39.6
--------------------------------------------------------------------------------
Adjustments to EBIT 0.0 -0.2 -0.7
--------------------------------------------------------------------------------
Depreciation and amortization 18.1 18.0 72.3
--------------------------------------------------------------------------------
Change in provisions -0.1 -2.2 -3.0
--------------------------------------------------------------------------------
Change in net working capital -15.7 -13.1 -28.3
--------------------------------------------------------------------------------
Financial income -1.0 0.8 12.1
--------------------------------------------------------------------------------
Financial expenses -8.0 -6.8 -31.8
--------------------------------------------------------------------------------
Taxes -1.8 -1.5 -6.4
--------------------------------------------------------------------------------
Net cash flow from operating -9.0 -3.6 53.9
activities
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Investments
--------------------------------------------------------------------------------
Gross investments in property, plant -20.3 -15.5 -60.4
and
equipment
--------------------------------------------------------------------------------
Disposals of property, plant and 0.5 1.4 1.9
equipment
--------------------------------------------------------------------------------
Investments in subsidiary - - -
--------------------------------------------------------------------------------
Shares in associates purchased -0.1 -0.2 -1.0
--------------------------------------------------------------------------------
Shares in associates sold 0.6 - 0.0
--------------------------------------------------------------------------------
Loans granted -1.0 -1.5 -1.8
--------------------------------------------------------------------------------
Repayments of loans receivable 0.1 0.1 2.1
--------------------------------------------------------------------------------
Net cash flow from investing -20.1 -15.7 -59.2
activities
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Cash flow before financing activities -29.2 -19.3 -5.4
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Financing activities
--------------------------------------------------------------------------------
Current borrowings raised 26.9 22.6 76.8
--------------------------------------------------------------------------------
Current borrowings repaid -6.8 -49.4 -98.3
--------------------------------------------------------------------------------
Non-current borrowings raised -1.4 81.2 159.4
--------------------------------------------------------------------------------
Non-current borrowings repaid -0.1 -59.5 -142.4
--------------------------------------------------------------------------------
Dividends paid 0.0 - -12.7
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Net cash flow from financing 18.5 -5.1 -17.1
activities
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Change in cash and cash equivalents -10.7 -24.5 -22.5
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Cash and cash equivalents at 1.1. 48.4 73.4 73.4
--------------------------------------------------------------------------------
Effect of changes in exchange rates 0.6 -0.2 -2.5
on cash and cash equivalents
--------------------------------------------------------------------------------
Cash and cash equivalents at 31.3. 38.3 48.7 48.4
--------------------------------------------------------------------------------
FINANCIAL INDICATORS
31.3.2012 31.3.2011 31.12.2011
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
Earnings per share (EPS), undiluted, EUR -0.09 -0.06 0.18
-----------------------------------------------------------------------------
Earnings per share (EPS), diluted, EUR -0.09 -0.06 0.18
-----------------------------------------------------------------------------
Equity per share at 31 March, EUR 7.66 7.67 7.67
-----------------------------------------------------------------------------
Equity ratio, % 33.1 34.4 33.6
-----------------------------------------------------------------------------
Adjusted average number of shares, mill. 55.0 55.0 55.0
-----------------------------------------------------------------------------
Gross capital expenditure on PPE, EUR mill. 19.8 15.1 61.0
-----------------------------------------------------------------------------
Employees, end of month average 7 913 8 227 8 287
-----------------------------------------------------------------------------
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
ACCOUNTING POLICIES
HKScan Corporation's interim report for 1 January - 31 March 2012 has been
prepared in compliance with IAS 34 Interim Financial Reporting. The same
accounting principles have been applied in the interim report as in the annual
financial statements for 2011. There are no IFRS standards or IFRIC
interpretations that have become effective in the period under review that
would have a material impact on the Group. Due to the rounding of the figures
to the nearest million euros in the interim report, some totals may not agree
with the sum of their constituent parts. These accounting principles are
explained in the financial statements for 2011.
ANALYSIS BY SEGMENT (EUR million)
Net sales and EBIT by main market area
Q1/2012 Q1/2011 2011
-----------------------------------------------------
NET SALES
-----------------------------------------------------
- Finland 197.6 188.0 812.4
-----------------------------------------------------
- Baltics 40.5 39.3 173.3
-----------------------------------------------------
- Sweden 246.9 252.3 1 045.7
-----------------------------------------------------
- Denmark 57.8 57.5 228.1
-----------------------------------------------------
- Poland 80.4 70.5 298.9
-----------------------------------------------------
- Between segments -17.2 -15.0 -67.1
-----------------------------------------------------
Group total 606.1 592.7 2 491.3
-----------------------------------------------------
-----------------------------------------------------
EBIT
-----------------------------------------------------
- Finland 2.7 -0.6 12.1
-----------------------------------------------------
- Baltics 0.7 0.9 9.8
-----------------------------------------------------
- Sweden -5.5 0.3 17.2
-----------------------------------------------------
- Denmark 0.3 -0.5 -3.7
-----------------------------------------------------
- Poland 3.4 3.0 12.7
-----------------------------------------------------
- Between segments - - -
-----------------------------------------------------
Segments total 1.6 3.1 48.0
-----------------------------------------------------
-----------------------------------------------------
Group administration costs -2.2 -1.7 -8.4
-----------------------------------------------------
Group total -0.6 1.4 39.6
-----------------------------------------------------
NOTES TO THE STATEMENT OF FINANCIAL POSITION
1. CHANGES IN INTANGIBLE ASSETS
(EUR million)
Q1/2012 Q1/2011 2011
---------------------------------------------------------------------
Carrying amount at beginning of period 76.6 77.1 77.1
---------------------------------------------------------------------
Translation differences 0.5 0.2 0.3
---------------------------------------------------------------------
Increase 0.1 0.3 2.3
---------------------------------------------------------------------
Increase (acquisitions) - - -
---------------------------------------------------------------------
Decrease - - -0.3
---------------------------------------------------------------------
Depreciation and impairment -1.1 -0.9 -4.0
---------------------------------------------------------------------
Transfer to other balance sheet item 0.5 0.1 1.1
---------------------------------------------------------------------
Carrying amount at end of period 76.6 76.8 76.6
---------------------------------------------------------------------
2. CHANGES IN GOODWILL
(EUR million)
Q1/2012 Q1/2011 2011
---------------------------------------------------------------------
Carrying amount at beginning of period 101.0 100.4 100.4
---------------------------------------------------------------------
Translation differences 0.3 -0.5 0.2
---------------------------------------------------------------------
Increase - 0.3 0.4
---------------------------------------------------------------------
Increase (acquisitions) - 0.0 0.0
---------------------------------------------------------------------
Decrease - - -
---------------------------------------------------------------------
Depreciation and impairment - - -
---------------------------------------------------------------------
Transfer to other balance sheet item - - -
---------------------------------------------------------------------
Carrying amount at end of period 101.3 100.2 101.0
---------------------------------------------------------------------
3. CHANGES IN PROPERTY, PLANT AND EQUIPMENT
(EUR million)
Q1/2012 Q1/2011 2011
---------------------------------------------------------------------
Carrying amount at beginning of period 516.5 537.8 537.8
---------------------------------------------------------------------
Translation differences 7.3 0.6 -7.9
---------------------------------------------------------------------
Increase 19.7 13.8 56.2
---------------------------------------------------------------------
Increase (acquisitions) -0.3 1.0 1.3
---------------------------------------------------------------------
Decrease -0.4 -1.1 -1.2
---------------------------------------------------------------------
Depreciation and impairment -17.5 -17.3 -67.7
---------------------------------------------------------------------
Transfer to other balance sheet item -0.5 -0.1 -1.8
---------------------------------------------------------------------
Carrying amount at end of period 524.8 534.7 516.5
---------------------------------------------------------------------
4. INVENTORIES
(EUR million)
Q1/2012 Q1/2011 2011
---------------------------------------------------------------------
Materials and supplies 91.0 101.7 88.7
---------------------------------------------------------------------
Unfinished products 13.0 10.8 9.1
---------------------------------------------------------------------
Finished products 76.8 54.6 72.1
---------------------------------------------------------------------
Goods 0.0 0.0 0.0
---------------------------------------------------------------------
Other inventories 7.9 7.5 7.7
---------------------------------------------------------------------
Prepayments for inventories 3.7 4.5 4.5
---------------------------------------------------------------------
Live animals, IFRS 41 8.5 7.9 7.9
---------------------------------------------------------------------
Total inventories 200.9 187.1 190.2
---------------------------------------------------------------------
5. NOTES TO EQUITY
Share capital Number of Share Share Reserve for Treasury Total
and share outstanding capital premium invested shares
premium shares reserve unrestricted
reserve equity
---------------------------------------------------------------------------
1.1.2012 54 972 788 66.8 72.9 143.5 0.0 283.2
---------------------------------------------------------------------------
31.3.2012 54 972 788 66.8 72.9 143.5 0.0 283.2
---------------------------------------------------------------------------
DERIVATIVE INSTRUMENT LIABILITIES
(EUR million)
31.3.2012 31.3.2011 31.12.2011
---------------------------------------------------------------------------
Nominal values of derivative instruments
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Foreign exchange derivatives 97.9 77.6 63.2
---------------------------------------------------------------------------
Interest rate derivatives 285.2 246.9 283.8
---------------------------------------------------------------------------
Electricity derivatives 11.3 10.3 11.1
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Fair values of derivative instruments
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Foreign exchange derivatives -0.9 0.9 -0.5
---------------------------------------------------------------------------
Interest rate derivatives -21.7 -12.4 -23.0
---------------------------------------------------------------------------
Electricity derivatives -1.4 1.3 -1.1
---------------------------------------------------------------------------
CONSOLIDATED OTHER CONTINGENT LIABILITIES
(EUR million)
31.3.2012 31.3.2011 31.12.2011
---------------------------------------------------------------------------
Debts secured by
---------------------------------------------------------------------------
pledges or mortgages
---------------------------------------------------------------------------
- loans from financial institutions 362.3 37.9 34.1
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Given as security
---------------------------------------------------------------------------
- real estate mortgages 67.4 61.9 63.0
---------------------------------------------------------------------------
- pledges 5.2 6.3 5.1
---------------------------------------------------------------------------
- floating charges 23.7 44.8 22.8
---------------------------------------------------------------------------
---------------------------------------------------------------------------
For associates
---------------------------------------------------------------------------
- guarantees 5.2 5.3 5.2
---------------------------------------------------------------------------
---------------------------------------------------------------------------
For others
---------------------------------------------------------------------------
- guarantees and pledges 13.4 13.8 14.0
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Other contingencies
---------------------------------------------------------------------------
Leasing commitments 26.2 25.7 26.2
---------------------------------------------------------------------------
Rent liabilities 58.9 44.8 61.0
---------------------------------------------------------------------------
Other commitments 7.5 7.5 7.8
---------------------------------------------------------------------------
The parent company has pledged the shares of its subsidiaries, HKScan Finland
Oy and Scan Ab, as security for its loans.
BUSINESS TRANSACTIONS WITH RELATED PARTIES
(EUR million)
Q1/2012 Q1/2011 2011
------------------------------------------------------------------
Sales to associates 19.6 15.9 73.0
------------------------------------------------------------------
Purchases from associates 9.9 13.0 47.3
------------------------------------------------------------------
Trade and other receivables 2.9 2.0 2.8
------------------------------------------------------------------
Trade and other payables 9.7 8.3 9.1
------------------------------------------------------------------
The figures presented in the interim report are unaudited.
NEXT FINANCIAL REPORT
The HKScan Group's interim report for January−June 2012 will be published on
Friday, 10 August 2012.
Vantaa, 8 May 2012
HKScan Corporation
Board of Directors
Further information is available from HKScan Corporation's CEO, Hannu Kottonen.
Please leave any messages for him to call with HKScan's communications manager
Marja Siltala, firstname.surname@hkscan.com, tel. +358 10 570 2290 or with
executive assistant Marjukka Hujanen, tel. +358 10 570 6218.
HKScan is one of the leading food companies in northern Europe with home
markets in Finland, Sweden, Denmark, the Baltic countries and Poland. HKScan
manufactures, sells and markets pork and beef, poultry products, processed
meats and convenience foods under strong brand names. Its customers are retail,
the HoReCa sector, industry and export customers. It had net sales of EUR 2.5
billion in 2011. HKScan is active in 10 countries and has some 11 400
employees.
DISTRIBUTION:
NASDAQ OMX Helsinki,
Main media,
www.hkscan.com
© 2024 Nasdaq, Inc. All Rights Reserved |