2010-10-26 11:00:00 CEST
2010-10-26 11:00:29 CEST
REGULATED INFORMATION
Ahlstrom - Interim report (Q1 and Q3)
Ahlstrom interim report January-September 2010: Sales growth continued
Ahlstrom Corporation STOCK EXCHANGE RELEASE 26.10.2010 at 12.00
July-September 2010 compared to July-September 2009:
· Net sales EUR 482.4 million (EUR 400.6 million), up 20.4%.
· Operating profit EUR 16.9 million (EUR 13.1 million). The figure
includes non-recurring items of EUR 0.3 million (EUR -4.4 million).
· Profit before taxes EUR 8.3 million (EUR 7.3 million), and earnings
per share EUR 0.06 (EUR 0.10).
· Net cash flow from operating activities EUR 67.5 million (EUR 67.3
million).
January-September 2010 compared to January-September 2009:
· Net sales EUR 1,412.8 million (EUR 1,175.6 million), up 20.2%.
· Operating profit EUR 60.7 million (EUR 12.1 million). The figure
includes non-recurring items of EUR 1.4 million (EUR -8.2 million).
· Profit before taxes EUR 38.1 million (loss before taxes EUR 6.6
million) and earnings per share EUR 0.44 (EUR -0.11).
· Net cash flow from operating activities EUR 144.7 million (EUR
161.0 million).
Events in July-September 2010
· Ahlstrom completed the acquisition of Shandong Puri Filter & Paper
Products Limited, manufacturer of filter materials for the transportation
industry, in China.
· The company's new financial reporting segments became effective on
July 1, 2010 as part of the renewed organizational and operating model.
Outlook for 2010
· Ahlstrom reiterates its previous outlook. The company estimates
that net sales for the current year will be above the 2008 level. Operating
profit excluding non-recurring items is estimated to increase from 2009.
Long-term financial targets
· The company's Board of Directors today approved Ahlstrom's
specified long-term financial targets. The targets for return on capital
employed and gearing ratio remain unchanged, and in addition, Ahlstrom is
seeking an increase of at least 5% in net sales annually at constant currency
rates, including acquisitions.
Jan Lång, President and CEO:
-The demand for our products continued to develop as forecasted in most of our
customer segments, and our cash flow remained strong in the third quarter, when
demand is seasonally weaker in many of our markets. Our growth strategy in Asia
moved forward with the completion of the acquisition of Shandong Puri Filter &
Paper Products Limited in China.
- Higher maintenance costs and adverse currency moves affected our results
negatively in the quarter. However, we will continue to work hard to improve our
profitability and increase performance of the production lines that were part of
our 2007 and 2008 investment program.
KEY FIGURES
+----------------------------------+-----+-----+-------+-------+-------+-------+
|Million EUR | 7-9/| 7-9/|Change,| 1-9/| 1-9/|Change,|
| | 2010| 2009| %| 2010| 2009| %|
+----------------------------------+-----+-----+-------+-------+-------+-------+
|Net sales |482.4|400.6| 20.4|1,412.8|1,175.6| 20.2|
+----------------------------------+-----+-----+-------+-------+-------+-------+
|Operating profit/loss | 16.9| 13.1| 29.4| 60.7| 12.1| 402.7|
+----------------------------------+-----+-----+-------+-------+-------+-------+
|Profit/loss before taxes | 8.3| 7.3| 14.3| 38.1| -6.6| -|
+----------------------------------+-----+-----+-------+-------+-------+-------+
|Profit/loss for the period | 4.1| 4.9| -15.2| 24.7| -5.0| -|
+----------------------------------+-----+-----+-------+-------+-------+-------+
|Earnings per share | 0.06| 0.10| -| 0.44| -0.11| -|
+----------------------------------+-----+-----+-------+-------+-------+-------+
|Return on capital employed (ROCE),| | | | | | |
|% | 6.0| 4.8| -| 7.4| 1.5| -|
+----------------------------------+-----+-----+-------+-------+-------+-------+
|Equity ratio, % | 44.3| 39.3| -| 44.3| 39.3| -|
+----------------------------------+-----+-----+-------+-------+-------+-------+
|Gearing ratio, % | 47.7| 81.9| -| 47.7| 81.9| -|
+----------------------------------+-----+-----+-------+-------+-------+-------+
|Interest-bearing net liabilities |333.7|511.3| -34.7| 333.7| 511.3| -34.7|
+----------------------------------+-----+-----+-------+-------+-------+-------+
|Capital expenditure (excluding | | | | | | |
|acquisitions) | 16.9| 12.4| 36.7| 28.7| 53.9| -46.7|
+----------------------------------+-----+-----+-------+-------+-------+-------+
|Net cash flow from operating | | | | | | |
|activities | 67.5| 67.3| 0.2| 144.7| 161.0| -10.1|
+----------------------------------+-----+-----+-------+-------+-------+-------+
|Number of personnel on average |5,844|5,899| -0.9| 5,805| 6,034| -3.8|
+----------------------------------+-----+-----+-------+-------+-------+-------+
|Number of personnel, at the end of| | | | | | |
|the period |5,949|5,849| 1.7| 5,949| 5,849| 1.7|
+----------------------------------+-----+-----+-------+-------+-------+-------+
OPERATING ENVIRONMENT
Demand for Ahlstrom's products continued to increase in July-September,
supported by the global economic growth. The pace of volume growth stabilized in
the third quarter compared to the beginning of 2010, as was anticipated in the
previous Interim Report. The vacation season coincided with the period under
review, resulting in downtime at many plants in Europe. Market related downtime
in production, however, decreased.
The European Commission imposed in September a provisional antidumping duty on
imports of certain glassfiber products originating from the People's Republic of
China to the European Union. The Commission has in its investigation concluded
that products originating from China create an imminence of disadvantage for the
industry in the European Union.
Rising prices of pulp and most of the other raw materials used by Ahlstrom
stabilized in the third quarter after a steady increase since mid-2009. On the
other hand, the prices of materials used in glassfiber increased in the third
quarter.
DEVELOPMENT OF NET SALES
+------------------------+-----+-----+--------+--------+-------+---------------+
|Net sales by business | 7-9/| 7-9/| Change,| 1-9/| 1-9/| Change,|
|area | 2010| 2009| %| 2010| 2009| %|
+------------------------+-----+-----+--------+--------+-------+---------------+
|Building and Energy | 66.3| 57.6| 15.2| 196.7| 167.6| 17.4|
+------------------------+-----+-----+--------+--------+-------+---------------+
|Filtration | 87.4| 70.5| 24.0| 254.9| 204.8| 24.5|
+------------------------+-----+-----+--------+--------+-------+---------------+
|Food and Medical | 88.7| 74.7| 18.7| 262.4| 231.7| 13.3|
+------------------------+-----+-----+--------+--------+-------+---------------+
|Home and Personal | 78.3| 66.6| 17.5| 215.6| 192.1| 12.3|
+------------------------+-----+-----+--------+--------+-------+---------------+
|Label and Processing |182.2|150.0| 21.5| 542.4| 436.0| 24.4|
+------------------------+-----+-----+--------+--------+-------+---------------+
|Other functions* and | | | | | | |
|eliminations |-20.5|-18.8| -| -59.2| -56.5 | -|
+------------------------+-----+-----+--------+--------+-------+---------------+
|Total net sales |482.4|400.6| 20.4| 1,412.8|1,175.6| 20.2|
+------------------------+-----+-----+--------+--------+-------+---------------+
* Other functions include financing and taxation-related receivables,
liabilities, and cost items, as well as earnings, costs, assets, and liabilities
belonging to holding and sales companies.
Development of net sales in July-September 2010
The Group's net sales increased by 20.4% compared to July-September 2009 and
amounted to EUR 482.4 million (EUR 400.6 million). Increase in net sales was
primarily due to price increases, while currency fluctuations and higher volumes
had a positive impact as well. Strongest growth was seen in the Asia Pacific
region (+74.1%) and in South America (+42.3%). Net sales in Europe increased by
15.4% and in North America by 6.0%.
Net sales in the Building and Energy segment increased by 15.2% to EUR 66.3
million (EUR 57.6 million). Net sales were in particular increased by the growth
of the wallpaper market in China and the construction and flooring material
markets in Russia. The wind power markets using Ahlstrom's glassfiber materials
improved in Europe, while remained depressed in North America.
Net sales of the Filtration segment increased by 24.0% to EUR 87.4 million (EUR
70.5 million). Growth was supported by the continued growth in Asia and recovery
in North American automotive industry, as well as higher selling prices and
favorable currency fluctuations.
Net sales in the Food and Medical segment increased by 18.7% to EUR 88.7 million
(EUR 74.7 million). Growth was attributable to price increases and favorable
currency fluctuations. Demand for food packaging and infusion materials as well
as medical nonwovens continued to be steady.
Net sales in the Home and Personal segment increased by 17.5% to EUR 78.3
million (EUR 66.6 million). Net sales were increased by growing sales volumes as
well as by price increases.
Net sales in the Label and Processing segment increased by 21.5% to EUR 182.3
million (EUR 150.0 million). Net sales grew, in particular, due to increased
sales prices to cover higher raw material costs. Demand grew in all specialty
paper products, with the exception of poster and pre-impregnated decor papers.
Favorable currency moves also had a positive impact.
Development of net sales in January-September 2010
Increased demand for Ahlstrom's products continued in January-September, and the
company adjusted the prices of its products due to the rapidly increased raw
material costs. The Group's net sales for January-September amounted to EUR
1,412.8 million, showing an increase of 20.2% compared to the corresponding
period in the previous year (EUR 1,175.6 million). The change in net sales was
affected by higher sales volumes and price increases.
Net sales grew the most in the Filtration (+24.5%), Label and Processing
(+24.4%) and Building and Energy (+17.4%) business areas. Also the less cyclical
business areas of Food and Medical (+13.3%) and Home and Personal (+12.3%) saw
an increase in net sales.
RESULT AND PROFITABILITY
+----------------------+-----+-----+--------+-----+----------+-----------------+
|Financial result | 7-9/| 7-9/| Change,| 1-9/| 1-9/| Change, MEUR|
|by business area | 2010| 2009| MEUR | 2010| 2009| |
+----------------------+-----+-----+--------+-----+----------+-----------------+
|Building and Energy | | | | | | |
+----------------------+-----+-----+--------+-----+----------+-----------------+
| Operating | | | | | | |
|profit/loss | 0.5| -1.4| 2.0| 0.2| -6.2| 6.4|
+----------------------+-----+-----+--------+-----+----------+-----------------+
| Operating | | | | | | |
|profit/loss, % | 0.8| -2.5| -| 0.1| -3.7| -|
+----------------------+-----+-----+--------+-----+----------+-----------------+
| RONA, % | 1.4| -3.3| -| 0.1| -4.9| -|
+----------------------+-----+-----+--------+-----+----------+-----------------+
|Filtration | | | | | | |
+----------------------+-----+-----+--------+-----+----------+-----------------+
| Operating | | | | | | |
|profit/loss | 7.0| 5.3| 1.7| 23.9| 10.6| 13.2|
+----------------------+-----+-----+--------+-----+----------+-----------------+
| Operating | | | | | | |
|profit/loss, % | 8.1| 7.6| -| 9.4| 5.2| -|
+----------------------+-----+-----+--------+-----+----------+-----------------+
| RONA, % | 14.8| 11.0| -| 17.5| 7.1| -|
+----------------------+-----+-----+--------+-----+----------+-----------------+
|Food and Medical | | | | | | |
+----------------------+-----+-----+--------+-----+----------+-----------------+
| Operating | | | | | | |
|profit/loss | 1.6| 2.6| -1.0| 10.9| 7.7| 3.2|
+----------------------+-----+-----+--------+-----+----------+-----------------+
| Operating | | | | | | |
|profit/loss, % | 1.8| 3.5| -| 4.2| 3.3| -|
+----------------------+-----+-----+--------+-----+----------+-----------------+
| RONA, % | 3.0| 5.1| -| 7.1| 4.9| -|
+----------------------+-----+-----+--------+-----+----------+-----------------+
|Home and Personal | | | | | | |
+----------------------+-----+-----+--------+-----+----------+-----------------+
| Operating | | | | | | |
|profit/loss | 2.6| 2.1| 0.5| 4.4| -0.6| 5.0|
+----------------------+-----+-----+--------+-----+----------+-----------------+
| Operating | | | | | | |
|profit/loss, % | 3.4| 3.2| -| 2.0| -0.3| -|
+----------------------+-----+-----+--------+-----+----------+-----------------+
| RONA, % | 5.2| 3.8| -| 3.0| -0.4| -|
+----------------------+-----+-----+--------+-----+----------+-----------------+
|Label and Processing | | | | | | |
+----------------------+-----+-----+--------+-----+----------+-----------------+
| Operating | | | | | | |
|profit/loss | 7.7| 5.0| 2.7| 27.2| 4.2| 23.0|
+----------------------+-----+-----+--------+-----+----------+-----------------+
| Operating | | | | | | |
|profit/loss, % | 4.2| 3.3| -| 5.0| 1.0| -|
+----------------------+-----+-----+--------+-----+----------+-----------------+
| RONA, % | 10.6| 6.0| -| 12.2| 1.6| -|
+----------------------+-----+-----+--------+-----+----------+-----------------+
|Other functions* and | | | | | | |
|eliminations | | | | | | |
+----------------------+-----+-----+--------+-----+----------+-----------------+
| Operating | | | | | | |
|profit/loss | -2.6| -0.6| -2.0| -5.8| -3.6| -2.2|
+----------------------+-----+-----+--------+-----+----------+-----------------+
|Ahlstrom Group total | | | | | | |
+----------------------+-----+-----+--------+-----+----------+-----------------+
| Operating | | | | | | |
|profit/loss | 16.9| 13.1| 3.8| 60.7| 12.1| 48.6|
+----------------------+-----+-----+--------+-----+----------+-----------------+
| Operating | | | | | | |
|profit/loss, % | 3.5| 3.3| -| 4.3| 1.0| -|
+----------------------+-----+-----+--------+-----+----------+-----------------+
| ROCE, % | 6.0| 4.8| -| 7.4| 1.5| -|
+----------------------+-----+-----+--------+-----+----------+-----------------+
* Other functions include financing and taxation-related receivables,
liabilities, and cost items, as well as earnings, costs, assets, and liabilities
belonging to holding and sales companies.
Result and profitability in July-September 2010
The Group operating profit was EUR 16.9 million (EUR 13.1 million). The figure
includes non-recurring items of EUR 0.3 million (EUR -4.4 million). Operating
profit excluding non-recurring items was EUR 16.6 million and fell slightly
short of that in the comparison period (EUR 17.5 million).
The operating profit was positively affected by increased production and
deliveries due to improved demand, and also by continued streamlining of
operations and the restructuring programs of 2009. Profit was negatively
affected by higher maintenance costs during the vacation shutdowns compared with
the comparison period and adverse currency moves. In addition, development
program costs related to the new operating model as well as challenges in ramp-
up and commercialization of production lines included in the investment programs
of the previous years hurt profitability.
Ahlstrom increased the prices of specialty papers, filtration materials and
wipes in particular in the period under review.
Operating profit of the Building and Energy segment increased to EUR 0.5 million
from a loss of EUR 1.4 million in the comparison period, supported by
streamlined operations and increased utilization rates. Ramp-up of the hybrid
wallcovering line in Turin, Italy, continued. The operating profit of the
Filtration segment grew to EUR 7.0 million (EUR 5.3 million) due to higher sales
volumes.
Operating profit of the Food and Medical segment fell to EUR 1.6 million (EUR
2.6 million). The result was weakened by the medical nonwovens plant in Mundra,
India, which was started earlier this year. Also, the commercialization of the
teabag material line in Chirnside, UK, has been significantly delayed.
Operating profit of the Home and Personal segment increased to EUR 2.6 million
(EUR 2.1 million), supported by increased sales volumes and higher utilization
rates. Operating profit of the Label and Processing segment increased to EUR
7.7 million (EUR 5.0 million). Profit growth was curbed by maintenance carried
out in the plants during the vacations and adverse currency moves.
Due to recovered demand, market related downtime in production amounted to 9.3%
in July-September 2010, whereas it had been 14.8% in the same period last year.
Net financial expenses were EUR 7.9 million (EUR 6.8 million). Net financial
expenses include net interest expenses of EUR 5.6 million (EUR 5.9 million),
financing exchange rate losses of EUR 0.8 million (loss of EUR 0.4 million), and
other financial expenses of EUR 1.4 million (EUR 0.4 million).
Profit before taxes was EUR 8.3 million (EUR 7.3 million).
Income taxes amounted to EUR 4.2 million (EUR 2.4 million).
Profit for the period was EUR 4.1 million (EUR 4.9 million). Earnings per share
were EUR 0.06 (EUR 0.10).
Return on capital employed (ROCE) amounted to 6.0% (4.8%), and return on equity
(ROE) was 2.3% (3.1%).
Result and profitability in January-September 2010
The Group operating profit was EUR 60.7 million (operating profit of EUR 12.1
million). The result includes non-recurring items of EUR 1.4 million (EUR -8.2
million). Operating profit excluding non-recurring items was EUR 59.3 million
and thus higher than in the comparison period (EUR 20.2 million). The operating
profit was in particular increased by improved sales volumes and the
streamlining measures started in 2009.
Due to recovered demand, market related downtime in production was 9.8% in
January-September 2010, whereas it had been 20.3% in the same period last year.
Net financial expenses were EUR 21.4 million (EUR 19.8 million). Net financial
expenses include net interest expenses of EUR 16.9 million (EUR 18.3 million),
financing exchange rate losses of EUR 0.3 million (a loss of EUR 0.2 million),
and other financial expenses of EUR 4.1 million (EUR 1.2 million).
Profit before taxes was EUR 38.1 million (EUR -6.6 million).
Income taxes were EUR 13.4 million (deferred tax income EUR 1.6 million).
Profit for the period was EUR 24.7 million (EUR -5.0 million). Earnings per
share were EUR 0.44 (EUR -0.11).
FINANCING
Net cash flow from operating activities in January-September amounted to EUR
144.7 million (EUR 161.0 million), and cash flow after investments was EUR
104.3 million (EUR 106.2 million).
Operative working capital has been given special attention since the beginning
of 2009. In January-September 2010, operative working capital decreased by EUR
36.4 million and turnover rate declined by 14 days. By the end of the period,
operative working capital amounted to EUR 208.3 million, which was EUR 140.7
million less than at the end of 2008 before the project to improve working
capital was started. Turnover had improved to 39 days.
The company's interest-bearing net liabilities decreased by EUR 62.2 million
from the end of 2009 to EUR 333.7 million (December 31, 2009: EUR 395.9
million). Ahlstrom's interest-bearing liabilities amounted to EUR 378.2 million.
The duration of the loan portfolio (average interest rate tying period) was 25
months and the capital-weighted average interest rate was 4.14%. The average
maturity of the loan portfolio was 28 months.
The company's liquidity is good. At the end of the period, its total liquidity,
including cash, unused committed credit facilities, and the consolidated account
overdraft facilities totaled EUR 336.9 million. In addition, the company had
uncommitted credit facilities totaling EUR 152.5 million available.
Gearing ratio decreased to 47.7% (December 31, 2009: 57.7%). Equity ratio was
44.3% (December 31, 2009: 44.8%).
CAPITAL EXPENDITURE
The company's investments excluding acquisitions amounted to EUR 28.7 million in
January-September (EUR 53.9 million).
In September, Ahlstrom completed the purchase of the entire share capital of
Shandong Puri Filter & Paper Products Ltd. from Purico Group. The debt free
acquisition price was EUR 22.5 million. The company manufactures filtration
materials for the transportation industry in Binzhou, Shandong province, in
northeastern China and currently employs approximately 170 people.
Ahlstrom's new medical nonwovens plant in Mundra, on the northwestern coast of
India, was inaugurated in May. The investment was approximately EUR 42 million,
and initially the plant employs approximately 70 people.
CHANGES IN THE EXECUTIVE MANAGEMENT TEAM
Risto Anttonen, Deputy to the CEO, will retire by December 31, 2010. Mr.
Anttonen is in charge of business development, and after his retirement, these
tasks will be transferred to other members of the Executive Management Team.
STREAMLINING PROGRAMS
Ahlstrom announced in September it will start consultations with employees and
customers to investigate future options, including a possible closure, for its
spunlace composite production line number 23 at the Chirnside plant in the
United Kingdom. The consultations affect a maximum of 11 employees. The line is
currently underutilized and the level of activity is not enough to support the
economic viability of the line. Ahlstrom aims to complete the consultations
during the fourth quarter.
The project to reduce material waste in production launched this year has
progressed according to plan. Ahlstrom targets a reduction of production waste
volume by 15 percent, equaling savings of approximately EUR 20 million per year
fully visible in 2012. The project was launched in two pilot units, and will be
extended to all production units by the end of next year.
The targeted EUR 55 million in savings from restructuring programs started in
2009 will be achieved in full this year.
The project to improve working capital started last year is in its final stages
and will continue until the end of the year.
PERSONNEL*
In January-September, Ahlstrom employed an average of 5,805 people* (6,034), and
at the end of the period, 5,949 people (5,849). The 2009 restructuring programs
resulted in the reduction of approximately 700 people, of whom 641 people were
terminated by the end of September this year. On the other hand, the company
hired new personnel in, for example, India at the beginning of the year and the
acquisition of the filtration materials plant in China increased personnel.
At the end of September, the highest numbers of employees were in the United
States (24%), France (21%), Italy (12%), Finland (9%), Germany (9%), and Brazil
(7%).
AUTHORIZATIONS OF THE BOARD
Ahlstrom Corporation's Annual General Meeting of March 31, 2010 authorized the
Board of Directors to repurchase the company's own shares in one or more
installments in accordance with the proposal of the Board. Based on the
authorization, a maximum of 4,500,000 of the company's own shares can be
repurchased, however, taking into consideration the regulations of the Limited
Liability Companies Act regarding the allowable maximum number of own shares at
any given time. The shares may be repurchased only through public trading at the
prevailing market price using unrestricted shareholders' equity.
The authorization contains the right of the Board of Directors to decide on all
other terms and conditions of the repurchase. Thus, the authorization also
contains the right to repurchase shares in a manner other than applying the
proportionate ownership of the shareholders.
Based on the authorization, the Board of Directors may resolve to distribute a
maximum of 4,500,000 own shares in the company's possession. The Board of
Directors is authorized to decide to whom and in which order the shares will be
distributed. The Board of Directors may resolve to distribute shares in a manner
other than that in which the shareholders have the priority to repurchase
shares. The shares may be used as consideration in acquisitions and in other
arrangements as well as to implement the company's share-based incentive plans,
in a manner and scope decided on by the Board of Directors. The Board of
Directors also has the right to decide on the distribution of the shares in
public trading for the purpose of financing possible acquisitions.
The Board's authorizations to repurchase and distribute own shares are valid for
18 months from the close of the Annual General Meeting but will, however, expire
at the close of the next Annual General Meeting, at the latest.
EVENTS AFTER THE REVIEW PERIOD
Ahlstrom initiates internal investigation on its business conduct in India
October 13, 2010, Ahlstrom initiated an internal investigation on the adherence
to its Code of Conduct at its manufacturing plant in Mundra, India. The
investigation deals with suspected unethical behavior in handling relationships
with local authorities. Ahlstrom has a strict Code of Conduct globally and the
purpose of the investigation is to find out whether the Code has been complied
with in its Indian operations.
The investigation has been initiated as a result of issues raised during the
writing of an article for the Finnish business magazine Talouselämä. The inquiry
is thorough and it will be carried out by an independent third party. Ahlstrom
will comment later on the results of the investigation.
Specified long-term financial targets
On October 26, 2010, Ahlstrom's Board of Directors approved updated long-term
financial targets supporting the company's profitable growth strategy. The
targets for return on capital employed and gearing ratio remain unchanged, and
in addition, Ahlstrom is seeking an increase of at least 5% in net sales
annually at constant currency rates, including acquisitions.
The targeted return on capital employed over the cycle remains at a minimum of
13 percent, and the goal is to achieve this by 2012. With the current balance
sheet structure, it takes a minimum of 7 percent operating profit margin to
reach this target. The targeted gearing ratio is 50 to 80 percent.
Repurchase of Ahlstrom shares
On October 26, 2010, Ahlstrom's Board of Directors decided to utilize the
authorization given by the Annual General Meeting held on March 31, 2010 to
repurchase Ahlstrom shares for the implementation of the company's share-based
incentive plan.
The maximum number of shares to be acquired is 75,000, corresponding to less
than 0.2% of the total number of shares. The repurchases shall decrease the
distributable capital and reserves. SHARES AND SHARE CAPITAL
Ahlstrom's shares are listed on the NASDAQ OMX Helsinki. Ahlstrom has one series
of shares. The share is classified under NASDAQ OMX's Materials sector and the
trading code is AHL1V.
In January-September 2010, a total of 6.47 million Ahlstrom shares were traded
for a total of EUR 77.5 million. The lowest trading price was EUR 9.31 and the
highest EUR 17.00. The closing price on September 30, 2010 was EUR 16.86. The
market capitalization was EUR 782.4 million at the end of September.
Ahlstrom Group's equity per share was EUR 13.33 at the end of the review period
(December 31, 2009: EUR 12.98).
During the period under review, Ahlstrom's Board of Directors used the
authorization granted by the Annual General Meeting of March 25, 2009, to
repurchase the company's own shares. The number of shares purchased was 75,000,
which accounts for less than 0.2% of Ahlstrom's all shares. The repurchase
reduced the company's distributable shareholders' equity. The purchases began on
February 10, 2010, and ended on March 16, 2010. The average price was EUR 11.68.
According to a share ownership plan started in August 2010, the Chief Executive
Officer and other members of the Executive Management team personally invest a
substantial amount of their own funds in Ahlstrom shares through a holding
company, Ahlcorp Oy, with the exception of the EMT member William Casey, who,
due to US legal requirements, acquires Ahlstrom shares directly. The
participants finance their investments partly themselves and partly by a loan
granted by Ahlstrom Corporation to Ahlcorp Oy and William Casey. The loans
granted by Ahlstrom are interest-bearing and amount to a maximum of EUR
3,920,000. As part of the plan, Ahlcorp Oy and William Casey shall purchase a
maximum amount of Ahlstrom shares worth EUR 4,900,000.
The plan enables the participants to acquire a considerable long-term
shareholding in Ahlstrom. It aligns the interests of the management and Ahlstrom
and supports the implementation of Ahlstrom's strategic targets. The actual
owner risk will be borne personally by the participants for the part of their
personal investment in the plan.
By the end of September, Ahlcorp Oy and William Casey had acquired 214,039
Ahlstrom shares, which has been reported as a purchase of own shares. The
purchases reduced the Group's equity by EUR 3.2 million.
The company received a notification in accordance with the Securities Markets
Act Chapter 2, Section 9, from Erkki Etola, dated May 21, 2010, on the change of
the said shareholder's holding. According to the notification, on May 20, 2010,
Etola's shareholding increased to over 5% (1/20) of Ahlstrom Corporation's
shares and votes.
The company received a notification in accordance with the Securities Markets
Act Chapter 2, Section 9, from Vilha Intressenter Ab, dated September 30, 2010,
on the change of the said shareholder's holding. According to the notification,
on September 29, 2010, Vilha Intressenter's shareholding decreased to under 5%
(1/20) of Ahlstrom Corporation's shares and votes.
OUTLOOK
Ahlstrom reiterates its previous outlook. The company estimates that net sales
for the current year will be above the 2008 level. Operating profit excluding
non-recurring items is estimated to increase from the 2009 level. Development of
net sales in the second half of the year is driven by the impact of increased
selling prices while the development of sales volumes will stabilize compared to
the previous year.
Selling price increases will continue in order to cover the recent increases in
raw material costs. Possible later increases in raw material prices are also
aimed to be covered by higher prices.
The company's more efficient cost structure and improved demand are expected to
boost profitability. Ongoing streamlining of operations will continue to be a
priority.
In 2010, investments excluding acquisitions are estimated at approximately EUR
55 million (EUR 63.8 million in 2009). Ahlstrom had previously estimated this
figure to be about EUR 60 million.
SHORT-TERM RISKS
Based on the recent development, the fastest pace in the global economic
recovery seems to be over. In particular, the slowdown of the U.S. economy and
the planned budget cuts and tax hikes in Europe may further weaken growth and
demand for Ahlstrom's products. If economic growth slows down quicker than
anticipated and the replenishment of inventory levels that supported demand
halts, it may be necessary to limit production more than planned, and the risk
of unsuccessful selling price increases, or even possible decline, will rise.
For the time being, credit losses have remained low, but due to the uncertain
economic situation, Ahlstrom's customer credit risks are still difficult to
cover with credit insurance.
Ahlstrom's main raw materials are natural fibers, mainly pulp, synthetic fibers
and chemicals. The company is one of the world's largest buyers of market pulp.
The prices of pulp, synthetic fibers and polymers in particular are assumed to
remain at a high level for the rest of 2010. Still, supply and demand of pulp
are expected to be balanced. Furthermore, the prices of some chemicals may
increase due to insufficient supply.
If the prices of raw materials remain at a high level or continue to rise, and
the increased costs cannot be passed onto selling prices, the increase in
profitability achieved in January-September 2010 might be compromised.
The general risks of Ahlstrom's business operations are described in greater
detail on the company website at www.ahlstrom.com and in the report by the Board
of Directors in the company's Annual Report 2009. The risk management process is
also described in the Corporate Governance Statement available on the company
website.
* * *
This interim report has been prepared in accordance with the International
Financial Reporting Standards (IFRS). Comparable figures refer to the same
period last year unless otherwise stated.
This report contains certain forward-looking statements that reflect the present
views of the company's management. The statements contain uncertainties and
risks and are thus subject to changes in the general economic situation and in
the company's business.
Helsinki, October 26, 2010
Ahlstrom Corporation
Board of Directors
ADDITIONAL INFORMATION
Jan Lång, President & CEO, tel. +358 (0)10 888 4700
Seppo Parvi, CFO, tel. +358 (0)10 888 4768
Ahlstrom's President & CEO Jan Lång and CFO Seppo Parvi will present the 2010
third-quarter results in a press and analyst conference in Finnish in Helsinki
on October 26, 2010, at 2:00 p.m. (GMT+2). The conference will take place at
Event Arena Bank, address Unioninkatu 20, 2(nd) floor. The name of the meeting
room will be displayed in the lobby.
In addition, President and CEO Lång and CFO Parvi will hold a conference call in
English for analysts and investors on October 26, 2010, at 4:00 p.m. (GMT+2). To
participate in the conference call, please dial +358 (0)9 2319 4250 in Finland
or +44 (0)20 7806 1953 outside of Finland a few minutes before the conference
begins. The access code is 7880049.
The conference call can also be followed live on the Internet. The link to the
presentation in English (an audio webcast) including slides is available on the
company website at www.ahlstrom.com. Questions may also be submitted in writing
via the Internet. Joining the webcast requires registration.
An on-demand webcast including slides is available for viewing and listening on
the company website for one year after the conference call.
The presentation material in English will be available on October 26, 2010,
after the Interim Report is published at www.ahlstrom.com > Investors > Reports
and presentations > 2010.
AHLSTROM'S FINANCIAL INFORMATION IN 2011
Ahlstrom will publish its financial information in 2011 as follows:
+----------------------------------+--------------------+--------------------+
|Report |Date of publication |Silent period |
+----------------------------------+--------------------+--------------------+
|Financial statements bulletin 2010|Tuesday, February 1 |January 1-February 1|
+----------------------------------+--------------------+--------------------+
|Interim Report January-April |Thursday, April 28 |April 1-April 28 |
+----------------------------------+--------------------+--------------------+
|Interim report January-June |Wednesday, August 10|July 1-August 10 |
+----------------------------------+--------------------+--------------------+
|Interim report January-September |Monday, October 24 |October 1-October 24|
+----------------------------------+--------------------+--------------------+
During the silent period, Ahlstrom will not communicate with capital market
representatives.
The annual report 2010 will be published during week 11.
The Annual General Meeting of Shareholders (AGM) will be held on March 30, 2011
at 1:00 p.m. in Finlandia Hall, address Mannerheimintie 13 e, Helsinki, Finland.
Distribution:
NASDAQ OMX Helsinki
www.ahlstrom.com
Principal media
Ahlstrom in brief
Ahlstrom is a global leader in the development, manufacture and marketing of
high performance nonwovens and specialty papers. Ahlstrom's products are used in
a large variety of everyday applications, such as filters, wipes, flooring,
labels, and tapes. Based upon its unique fiber expertise and innovative
approach, the company has a strong market position in several business areas in
which it operates. Ahlstrom's 5,800 employees serve customers via sales offices
and production facilities in more than 20 countries on six continents. In 2009,
Ahlstrom's net sales amounted to approximately EUR 1.6 billion. Ahlstrom's share
is quoted on the NASDAQ OMX Helsinki. The company website is at
www.ahlstrom.com.
APPENDIX
Consolidated financial statements
APPENDIX
Financial statements are unaudited.
----------------------------------------------------------------------
INCOME STATEMENT Q3 Q3 Q1-Q3 Q1-Q3 Q1-Q4
EUR million 2010 2009 2010 2009 2009
----------------------------------------------------------------------
Net sales 482.4 400.6 1,412.8 1,175.6 1,596.1
Cost of goods sold -420.5 -346.9 -1,222.1 -1,043.4 -1,421.5
----------------------------------------------------------------------
Gross profit 61.9 53.7 190.7 132.2 174.6
Sales and marketing expenses -12.7 -11.9 -40.1 -36.4 -49.6
R&D expenses -5.2 -5.5 -14.9 -15.9 -21.6
Administrative expenses -25.9 -24.1 -80.4 -72.6 -95.0
Other operating income 0.9 2.0 8.9 8.1 13.4
Other operating expense -2.1 -1.1 -3.5 -3.3 -36.3
----------------------------------------------------------------------
Operating profit / loss 16.9 13.1 60.7 12.1 -14.6
Net financial expenses -7.9 -6.8 -21.4 -19.8 -26.2
Share of profit / loss of
associated companies -0.7 1.0 -1.2 1.1 0.7
----------------------------------------------------------------------
Profit / loss before taxes 8.3 7.3 38.1 -6.6 -40.1
Income taxes -4.2 -2.4 -13.4 1.6 7.1
----------------------------------------------------------------------
Profit / loss for the period 4.1 4.9 24.7 -5.0 -32.9
----------------------------------------------------------------------
Attributable to
Owners of the parent 4.1 4.9 24.7 -5.0 -32.9
Non-controlling interest - - - - -
----------------------------------------------------------------------
Earnings per share, EUR
- Basic and diluted * 0.06 0.10 0.44 -0.11 -0.72
* With the effect of interest on hybrid bond for the period, net of tax
--------------------------------------------------------------------
STATEMENT OF COMPREHENSIVE INCOME Q3 Q3 Q1-Q3 Q1-Q3 Q1-Q4
EUR million 2010 2009 2010 2009 2009
--------------------------------------------------------------------
Profit / loss for the period 4.1 4.9 24.7 -5.0 -32.9
Other comprehensive income,
net of tax:
Translation differences -28.5 1.1 26.3 22.3 32.5
Hedges of net investments in foreign
operations -0.0 -0.5 -2.8 -0.1 -1.0
Cash flow hedges -0.0 -0.1 -0.4 -0.0 0.4
--------------------------------------------------------------------
Other comprehensive income, net of tax -28.5 0.4 23.2 22.2 31.8
--------------------------------------------------------------------
Total comprehensive income for the
period -24.4 5.2 47.8 17.2 -1.1
--------------------------------------------------------------------
Attributable to
Owners of the parent -24.4 5.2 47.8 17.2 -1.1
Non-controlling interest - - - - -
--------------------------------------------------------------
BALANCE SHEET Sep 30, Sep 30, Dec 31,
EUR million 2010 2009 2009
--------------------------------------------------------------
ASSETS
Non-current assets
Property, plant and equipment 707.9 733.7 717.6
Goodwill 167.7 173.5 151.3
Other intangible assets 54.5 52.2 52.1
Investments in associated
companies 10.9 12.5 12.1
Other investments 0.4 0.2 0.2
Other receivables 23.3 19.7 23.0
Deferred tax assets 56.3 45.3 54.5
--------------------------------------------------------------
Total non-current assets 1,021.0 1,037.1 1,010.8
Current assets
Inventories 197.4 182.0 175.9
Trade and other receivables 314.5 330.7 319.9
Income tax receivables 2.8 2.7 3.7
Other investments - - -
Cash and cash equivalents 44.5 36.2 19.9
--------------------------------------------------------------
Total current assets 559.2 551.6 519.4
--------------------------------------------------------------
Total assets 1,580.2 1,588.7 1,530.2
--------------------------------------------------------------
EQUITY AND LIABILITIES
Equity attributable to owners of
the parent 618.4 624.3 605.6
Hybrid bond 80.0 - 80.0
Non-controlling interest 0.9 - -
--------------------------------------------------------------
Total equity 699.3 624.3 685.6
Non-current liabilities
Interest-bearing loans and borrowings 203.3 362.3 235.1
Employee benefit obligations 79.4 84.5 78.2
Provisions 3.5 4.4 5.0
Other liabilities 3.9 0.3 0.4
Deferred tax liabilities 33.3 20.9 23.8
--------------------------------------------------------------
Total non-current liabilities 323.3 472.3 342.5
Current liabilities
Interest-bearing loans and borrowings 174.9 185.3 180.7
Trade and other payables 369.4 292.3 305.1
Income tax liabilities 5.9 3.0 3.7
Provisions 7.4 11.5 12.7
--------------------------------------------------------------
Total current liabilities 557.6 492.1 502.1
--------------------------------------------------------------
Total liabilities 880.9 964.4 844.6
--------------------------------------------------------------
Total equity and liabilities 1,580.2 1,588.7 1,530.2
--------------------------------------------------------------
STATEMENT OF CHANGES IN EQUITY
1) Issued capital
2) Share premium
3) Non-restricted equity reserve
4) Hedging reserve
5) Translation reserve
6) Own shares
7) Retained earnings
8) Total attributable to owners of the parent
9) Non-controlling interest
10) Hybrid bond
11) Total equity
EUR million 1) 2) 3) 4) 5) 6) 7) 8) 9) 10) 11)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Equity at January
1, 2009 70.0 209.3 8.3 -1.2 -49.1 - 390.9 628.1 0.0 - 628.1
Profit / loss for the
period - - - - - - -5.0 -5.0 - - -5.0
Other comprehensive
income,
net of tax
Translation
differences - - - - 22.3 - - 22.3 - - 22.3
Hedges of net
investments
in foreign operations - - - - -0.1 - - -0.1 - - -0.1
Cash flow hedges - - - -0.0 - - - -0.0 - - -0.0
Dividends paid and
other - - - - - - -21.0 -21.0 - - -21.0
Hybrid bond - - - - - - - - - - -
Interest on hybrid
bond - - - - - - - - - - -
Purchases of own
shares - - - - - - - - - - -
Share ownership plan
for EMT - - - - - - - - - - -
Change in non-
controlling
interests - - - - - - - - -0.0 - -0.0
Share-based incentive
plan - - - - - - - - - - -
Equity at September
30, 2009 70.0 209.3 8.3 -1.3 -26.9 - 364.9 624.3 - - 624.3
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Equity at January
1, 2010 70.0 209.3 8.3 -0.8 -17.7 - 336.6 605.6 - 80.0 685.6
Profit / loss for the
period - - - - - - 24.7 24.7 - - 24.7
Other comprehensive
income,
net of tax
Translation
differences - - - - 26.3 - - 26.3 - - 26.3
Hedges of net
investments
in foreign operations - - - - -2.8 - - -2.8 - - -2.8
Cash flow hedges - - - -0.4 - - - -0.4 - - -0.4
Dividends paid and
other - - - - - - -26.0 -26.0 - - -26.0
Hybrid bond - - - - - - - - - - -
Interest on hybrid
bond - - - - - - -5.6 -5.6 - - -5.6
Purchases of own
shares - - - - - -0.9 - -0.9 - - -0.9
Share ownership plan
for EMT - - - - - -2.8 - -2.8 0.9 - -2.0
Change in non-
controlling
interests - - - - - - - - - - -
Share-based incentive
plan - - - - - - 0.3 0.3 - - 0.3
Equity at September
30, 2010 70.0 209.3 8.3 -1.2 5.9 -3.7 329.9 618.4 0.9 80.0 699.3
---------------------------------------------------------------------------
STATEMENT OF CASH FLOWS Q3 Q3 Q1-Q3 Q1-Q3 Q1-Q4
EUR million 2010 2009 2010 2009 2009
---------------------------------------------------------------------------
Cash flow from operating activities
Profit / loss for the period 4.1 4.9 24.7 -5.0 -32.9
Adjustments, total 39.3 33.1 113.6 93.0 146.3
Changes in net working capital 31.3 38.7 56.7 95.1 129.3
Change in provisions -2.3 -2.0 -5.7 -7.1 -5.3
Financial items -3.6 -6.8 -40.2 -15.8 -28.2
Income taxes paid / received -1.4 -0.5 -4.4 0.9 0.4
---------------------------------------------------------------------------
Net cash from operating activities 67.5 67.3 144.7 161.0 209.6
Cash flow from investing activities
Acquisition of Group companies -11.2 - -11.2 -0.0 -0.0
Purchases of intangible and tangible assets -15.8 -13.3 -29.2 -58.0 -69.8
Other investing activities -0.2 2.1 0.1 3.2 3.5
---------------------------------------------------------------------------
Net cash from investing activities -27.3 -11.2 -40.3 -54.8 -66.3
Cash flow from financing activities
Dividends paid - - -25.6 -21.0 -21.0
Repurchase of own shares - - -0.9 - -
Investment to Ahlstrom Corporation
shares related to share ownership
plan for EMT -2.0 - -2.0 - -
Payments received on hybrid bond - - - - 80.0
Changes in loans and other financing
activities -13.2 -52.8 -52.2 -108.7 -242.6
---------------------------------------------------------------------------
Net cash from financing activities -15.1 -52.8 -80.7 -129.7 -183.6
Net change in cash and cash equivalents 25.1 3.3 23.7 -23.5 -40.2
Cash and cash equivalents at the beginning
of the period 20.0 32.6 19.9 58.2 58.2
Foreign exchange adjustment -0.6 0.3 0.9 1.5 2.0
---------------------------------------------------------------------------
Cash and cash equivalents at the end of
the period 44.5 36.2 44.5 36.2 19.9
---------------------------------------------------------------------------
--------------------------------------------------------------------------------
KEY FIGURES Q3 Q3 Q1-Q3 Q1-Q3 Q1-Q4
2010 2009 2010 2009 2009
--------------------------------------------------------------------------------
Personnel costs -84.1 -80.8 -259.6 -247.1 -337.8
Depreciation and amortization -26.2 -25.2 -78.3 -76.5 -106.7
Impairment charges -0.1 0.2 -0.1 0.2 -31.1
--------------------------------------------------------------------------------
Operating profit, % 3.5 3.3 4.3 1.0 -0.9
Return on capital employed (ROCE), % 6.0 4.8 7.4 1.5 -1.1
Return on equity (ROE), % 2.3 3.1 4.8 -1.1 -5.0
--------------------------------------------------------------------------------
Interest-bearing net liabilities, EUR
million 333.7 511.3 333.7 511.3 395.9
Equity ratio, % 44.3 39.3 44.3 39.3 44.8
Gearing ratio, % 47.7 81.9 47.7 81.9 57.7
--------------------------------------------------------------------------------
Basic earnings per share *, EUR 0.06 0.10 0.44 -0.11 -0.72
Equity per share, EUR 13.33 13.38 13.33 13.38 12.98
Average number of shares during
the period, 1000's 46,517 46,671 46,585 46,671 46,671
Number of shares at the end of
the period, 1000's 46,403 46,671 46,403 46,671 46,671
--------------------------------------------------------------------------------
Capital expenditure, EUR million 16.9 12.4 28.7 53.9 63.8
Capital employed, at the end of
the period, EUR million 1,077.5 1,171.8 1,077.5 1,171.8 1,101.5
Number of employees, average 5,844 5,899 5,805 6,034 5,993
* With the effect of interest on hybrid bond for the period, net of tax
ACCOUNTING PRINCIPLES
This interim report has been prepared in accordance with IAS 34, Interim
Financial reporting, as adopted by EU and the accounting principles set out in
the Group's Financial Statements for 2009 except for the changes below.
Changes in accounting principles
The Group has adopted the following new or amended standards and interpretations
as of January 1, 2010:
- IFRS 3 Business Combinations (revised)
Some of the main changes to the standard are as follows:
Contingent consideration is measured at fair value at the acquisition date, with
subsequent changes recognized in the income statement.
All acquisition-related costs are expensed.
Any non-controlling interest is measured at either fair value, or at its
proportionate interest in the identifiable assets and liabilities,on a
transaction-by-transaction basis
- IAS 27 Consolidated and Separate Financial Statements (revised)
The amendment specifies the accounting for changes in ownership interests in
subsidiaries.
- Improvements to IFRS Standards 2009
The effects of the amendments vary by standard but the amendments have had no
major impact on the cosolidated financial statements.
The below mentioned new or amended standards and interpretations adopted by the
Group in 2010 do not have an effect on the consolidated financial
statements.
- IAS 39 Financial Instruments: Recognition and Measurement (amendment) -
Eligible Hedged Items
- IFRIC 12 Service Concession Arrangements
- IFRIC 15 Agreements for the Construction of Real Estate
- IFRIC 16 Hedges of a Net Investment in a Foreign Operation
- IFRIC 17 Distributions of Non-cash Assets to Owners
- IFRIC 18 Transfers of Assets from Customers
Income statement by function
The Group has changed the presentation of the income statement from the "nature
of expense" method to the "function of expense" method in the beginning of
2010. The comparable figures have been restated accordingly.
Revised organization and operating model
The Group announced in May 2010 its revised organization and operating model.
Ahlstrom organized its businesses in five Business Areas which form new
reporting segments in financial reporting. The new reporting segments are
Building and Energy, Filtration, Food and Medical, Home and Personal and Label
and Processing.
The changes were implemented as of July 1, 2010. Ahlstrom published the
comparative data on the new segments for the financial year 2009 and for the
first two quarters of 2010 on September 28, 2010.
--------------------------------------------------------------------------------
SEGMENT
INFORMATION Q1 Q2 Q3 Q4 Q1-Q4 Q1 Q2 Q3
EUR million 2009 2009 2009 2009 2009 2010 2010 2010
--------------------------------------------------------------------------------
Building and
Energy 55.8 54.2 57.6 56.1 223.7 62.1 68.3 66.3
Filtration 64.9 69.4 70.5 71.0 275.8 79.0 88.5 87.4
Food and Medical 78.0 79.0 74.7 78.5 310.2 82.0 91.7 88.7
Home and
Personal 61.8 63.7 66.6 73.0 265.1 66.0 71.3 78.3
Label and
Processing 134.4 151.6 150.0 162.5 598.5 172.0 188.1 182.2
Other operations 7.4 9.6 9.7 10.9 37.7 9.5 11.8 11.5
Internal sales -26.3 -28.6 -28.4 -31.6 -114.8 -29.6 -30.4 -32.0
--------------------------------------------------------------------------------
Total net sales 376.1 398.9 400.6 420.5 1,596.1 441.0 489.4 482.4
Building and
Energy 2.7 2.8 3.7 4.4 13.5 3.5 3.8 3.8
Filtration 1.3 1.2 1.8 2.5 6.8 1.9 1.8 1.4
Food and Medical 8.5 8.5 6.5 7.1 30.6 7.0 6.7 9.3
Home and
Personal 4.7 4.2 5.0 5.5 19.4 5.3 5.9 5.7
Label and
Processing 6.6 7.7 7.5 7.1 29.0 7.7 7.7 7.4
Other operations 2.4 4.3 4.0 4.8 15.6 4.2 4.4 4.4
--------------------------------------------------------------------------------
Total internal
sales 26.3 28.6 28.4 31.6 114.8 29.6 30.4 32.0
Building and
Energy -2.9 -1.9 -1.4 -4.5 -10.8 -1.8 1.4 0.5
Filtration 0.9 4.4 5.3 -6.9 3.7 7.5 9.4 7.0
Food and Medical 0.9 4.2 2.6 1.7 9.4 4.0 5.3 1.6
Home and
Personal -2.3 -0.4 2.1 -18.3 -18.9 0.4 1.3 2.6
Label and
Processing -4.3 3.4 5.0 -0.9 3.3 5.3 14.2 7.7
Other operations -2.7 -0.1 -0.8 2.3 -1.4 -1.4 -1.9 -2.7
Eliminations -0.3 0.2 0.1 -0.0 0.0 -0.0 0.1 0.0
--------------------------------------------------------------------------------
Operating profit
/ loss -10.7 9.7 13.1 -26.6 -14.6 14.0 29.8 16.9
Operating profit
/ loss, %
Building and
Energy -5.2 -3.5 -2.5 -8.1 -4.8 -2.8 2.0 0.8
Filtration 1.4 6.4 7.6 -9.7 1.4 9.4 10.6 8.1
Food and Medical 1.2 5.3 3.5 2.2 3.0 4.8 5.8 1.8
Home and
Personal -3.8 -0.7 3.2 -25.0 -7.1 0.7 1.8 3.4
Label and
Processing -3.2 2.3 3.3 -0.5 0.6 3.1 7.5 4.2
Group total -2.9 2.4 3.3 -6.3 -0.9 3.2 6.1 3.5
Return on net
assets
(RONA), %
Building and
Energy -6.7 -4.4 -3.3 -11.0 -6.5 -4.4 3.5 1.4
Filtration 1.7 8.5 11.0 -15.3 1.9 16.7 20.1 14.8
Food and Medical 1.6 7.6 5.1 3.4 4.5 7.7 9.7 3.0
Home and
Personal -3.9 -0.7 3.8 -35.0 -8.6 0.9 2.5 5.2
Label and
Processing -4.8 3.9 6.0 -1.1 1.0 6.9 18.8 10.6
Group (ROCE), % -3.3 3.2 4.8 -9.4 -1.1 5.2 10.9 6.0
Building and
Energy 174.3 172.5 170.3 158.6 158.6 161.0 156.3 147.6
Filtration 214.7 200.3 188.1 172.5 172.5 183.7 188.3 191.5
Food and Medical 222.5 215.1 200.8 203.5 203.5 211.2 228.9 206.0
Home and
Personal 238.4 227.5 218.9 197.9 197.9 202.9 210.6 191.2
Label and
Processing 351.4 344.0 330.9 313.2 313.2 300.9 302.4 280.2
Other operations -38.2 -2.4 -3.1 -2.1 -2.1 -37.3 -9.4 -12.5
Eliminations -0.7 -0.5 -0.4 -0.4 -0.4 -0.4 -0.4 -0.3
--------------------------------------------------------------------------------
Total net assets 1,162.3 1,156.4 1,105.6 1,043.2 1,043.2 1,022.0 1,076.8 1,003.6
Building and
Energy 15.0 5.1 3.1 1.6 24.8 0.4 0.7 1.6
Filtration 0.8 1.0 1.0 0.5 3.3 0.3 1.2 1.6
Food and Medical 7.9 5.8 6.0 4.0 23.7 4.4 0.9 4.6
Home and
Personal 1.0 0.7 0.3 0.5 2.5 0.0 0.5 1.1
Label and
Processing 2.1 1.9 1.7 3.1 8.9 1.0 1.7 7.7
Other operations 0.2 0.1 0.2 0.2 0.7 0.3 0.3 0.3
--------------------------------------------------------------------------------
Total capital
expenditure 26.9 14.6 12.4 9.9 63.8 6.5 5.3 16.9
Building and
Energy -4.5 -4.5 -4.5 -4.4 -18.0 -4.4 -4.6 -4.5
Filtration -5.2 -5.4 -4.9 -5.3 -20.8 -4.7 -4.9 -4.7
Food and Medical -3.8 -4.4 -4.2 -9.0 -21.4 -4.4 -5.2 -5.2
Home and
Personal -3.6 -3.9 -3.9 -3.6 -15.1 -4.2 -4.2 -4.1
Label and
Processing -7.6 -7.1 -7.0 -7.2 -28.9 -7.2 -7.1 -7.0
Other operations -0.6 -0.6 -0.6 -0.6 -2.4 -0.6 -0.6 -0.6
--------------------------------------------------------------------------------
Total
depreciation and
mortization -25.3 -25.9 -25.2 -30.2 -106.7 -25.5 -26.6 -26.2
Building and
Energy - - - - - - - -
Filtration - - - -8.7 -8.7 - - -
Food and Medical - - - - - - - -
Home and
Personal - - - -22.5 -22.5 - -0.0 -
Label and
Processing -0.0 -0.0 0.2 -0.0 0.1 -0.0 -0.0 -0.1
Other operations - - - - - - - -
--------------------------------------------------------------------------------
Total impairment
charges -0.0 -0.0 0.2 -31.2 -31.1 -0.0 -0.1 -0.1
Building and
Energy - -0.1 -0.3 -2.1 -2.5 - - -
Filtration -0.0 -0.3 -0.8 -11.4 -12.5 - - 0.3
Food and Medical -0.5 -0.2 -0.7 -5.0 -6.3 - 0.8 -
Home and
Personal -0.2 -1.4 0.0 -22.1 -23.8 - - -
Label and
Processing - -0.5 -1.7 -4.4 -6.6 0.0 - 1.5
Other operations - -0.5 -1.0 -1.3 -2.7 0.3 0.0 -1.5
--------------------------------------------------------------------------------
Total non-
recurring items -0.7 -3.0 -4.4 -46.2 -54.3 0.3 0.8 0.3
Segment information is presented according to the IFRS standards.
-------------------------------------------------------
NET SALES BY REGION Q3 Q3 Q1-Q3 Q1-Q3 Q1-Q4
EUR million 2010 2009 2010 2009 2009
-------------------------------------------------------
Europe 245.6 212.9 740.1 624.4 846.3
North America 105.4 99.5 327.2 308.0 410.1
South America 66.7 46.9 170.7 126.1 174.9
Asia-Pacific 55.7 32.0 145.8 94.5 134.2
Rest of the world 8.9 9.3 29.0 22.7 30.7
-------------------------------------------------------
Total net sales 482.4 400.6 1,412.8 1,175.6 1,596.1
---------------------------------------------------------------
CHANGES OF PROPERTY, PLANT AND
EQUIPMENT Q1-Q3 Q1-Q3 Q1-Q4
EUR million 2010 2009 2009
---------------------------------------------------------------
Book value at Jan 1 717.6 745.7 745.7
Acquisitions through business combinations 11.5 - -
Additions 28.0 52.9 63.6
Disposals -0.3 -0.7 -1.0
Depreciations and impairment charges -74.0 -71.8 -106.9
Translation differences and other changes 25.0 7.7 16.1
Book value at the end of the period 707.9 733.7 717.6
---------------------------------------------------------
TRANSACTIONS WITH RELATED PARTIES Q1-Q3 Q1-Q3 Q1-Q4
EUR million 2010 2009 2009
---------------------------------------------------------
Transactions with associated companies
Sales and interest income 0.4 0.4 0.5
Purchases of goods and services -2.1 -1.7 -2.4
Trade and other receivables 0.1 0.0 0.0
Trade and other payables 0.2 0.2 0.2
Market prices have been used in transactions with associated companies.
--------------------------------------------
OPERATING LEASES Sep 30, Sep 30, Dec 31,
EUR million 2010 2009 2009
--------------------------------------------
Current portion 5.7 6.7 6.6
Non-current portion 19.2 15.2 20.4
--------------------------------------------
Total 24.9 21.9 27.0
--------------------------------------------
-----------------------------------------------------------------------------
COLLATERALS AND COMMITMENTS Sep 30, Sep 30, Dec 31,
EUR million 2010 2009 2009
-----------------------------------------------------------------------------
Mortgages 73.0 - 73.0
Pledges 0.2 0.3 0.3
Commitments
Guarantees given on behalf of group companies 22.9 41.5 19.6
Guarantees given on behalf of associated companies - 2.1 2.1
Capital expenditure commitments 7.3 13.2 10.2
Other commitments
2.1 4.1 3.6
----------------
ACQUISITIONS IN 2010
In September, Ahlstrom acquired the shares of Shandong Puri Filter & Paper
Products Limited in China from the Purico Group.The debt free transaction value
was EUR 22.5 million. Shandong Puri Filter & Paper Products Limited produces
transportation filtration media and operates a plant in Binzhou in the province
of Shandong in northeastern China.
Shandong Puri Filter & Paper Products Limited has been incorporated in
Ahlstrom's accounts as part of Filtration segment since September 13, 2010. If
the acquisition had occurred on January 1, 2010, Group's net sales and profit
for the period would not have changed materially.Direct costs related to the
transaction were EUR 0.8 million and they are booked as administrative expenses
in the Group's income statement.
The transaction value exceeded the book value of net assets in Shandong Puri
Filter & Paper Products Limited by EUR 11.3 million, of which EUR 3.9 million is
allocated toproperty, plant and equipment to meet their fair value. Deferred tax
liability booking of the allocation amounts to EUR 1.0 million.The goodwill of
EUR 8.4 million that arose from the acquisition reflects the personnel, synergy
benefits and expanded business opportunities in Asia.
The preliminary fair values of the identifiable assets and liabilities of the
acquired businesses at date of acquisition are summarized below.
-----------------------------------------------------
ACQUISITIONS OF BUSINESSES Book Fair
EUR million values values
-----------------------------------------------------
Property, plant and equipment 8.2 12.1
Intangible assets 3.1 3.1
Inventories 0.9 0.9
Trade and other receivables 0.8 0.8
Cash and cash equivalents 1.9 1.9
-----------------------------------------------------
Total assets 14.9 18.8
Deferred tax liabilities 1.0
Interest-bearing loans and borrowings 12.1 12.1
Trade and other payables 2.9 2.9
-----------------------------------------------------
Total liabilities 15.0 16.0
-----------------------------------------------------
Net assets -0.1 2.9
Goodwill arising in acquisition 8.4
Acquisition price paid (in cash) 11.2
Cash (acquired) -1.9
-----------------------------------------------------
Net cash outflow 9.3
-----------------------------------------------------------------------------
QUARTERLY DATA Q3 Q2 Q1 Q4 Q3 Q2 Q1
EUR million 2010 2010 2010 2009 2009 2009 2009
-----------------------------------------------------------------------------
Net sales 482.4 489.4 441.0 420.5 400.6 398.9 376.1
Cost of goods sold -420.5 -416.3 -385.3 -378.1 -346.9 -349.4 -347.1
-----------------------------------------------------------------------------
Gross profit 61.9 73.1 55.7 42.4 53.7 49.5 29.0
Sales and marketing expenses -12.7 -14.1 -13.3 -13.2 -11.9 -11.7 -12.8
R&D expenses -5.2 -5.1 -4.6 -5.7 -5.5 -4.9 -5.5
Administrative expenses -25.9 -29.5 -25.0 -22.3 -24.1 -25.1 -23.5
Other operating income 0.9 5.9 2.1 5.3 2.0 3.5 2.7
Other operating expense -2.1 -0.6 -0.8 -33.0 -1.1 -1.6 -0.6
-----------------------------------------------------------------------------
Operating profit / loss 16.9 29.8 14.0 -26.6 13.1 9.7 -10.7
Net financial expenses -7.9 -6.9 -6.7 -6.4 -6.8 -4.8 -8.2
Share of profit / loss of
associated companies -0.7 -0.4 -0.0 -0.4 1.0 -0.3 0.4
-----------------------------------------------------------------------------
Profit / loss before taxes 8.3 22.5 7.4 -33.4 7.3 4.7 -18.6
Income taxes -4.2 -7.4 -1.9 5.5 -2.4 -2.2 6.2
-----------------------------------------------------------------------------
Profit / loss for the period 4.1 15.1 5.5 -27.9 4.9 2.5 -12.4
-----------------------------------------------------------------------------
Attributable to
Owners of the parent 4.1 15.1 5.5 -27.9 4.9 2.5 -12.4
Non-controlling interest - - - - - - -
---------------------------------------------------------------------------
QUARTERLY DATA BY SEGMENT Q3 Q2 Q1 Q4 Q3 Q2 Q1
EUR million 2010 2010 2010 2009 2009 2009 2009
---------------------------------------------------------------------------
Net sales
Building and Energy 66.3 68.3 62.1 56.1 57.6 54.2 55.8
Filtration 87.4 88.5 79.0 71.0 70.5 69.4 64.9
Food and Medical 88.7 91.7 82.0 78.5 74.7 79.0 78.0
Home and Personal 78.3 71.3 66.0 73.0 66.6 63.7 61.8
Label and Processing 182.2 188.1 172.0 162.5 150.0 151.6 134.4
Other operations and eliminations -20.5 -18.6 -20.1 -20.7 -18.8 -18.9 -18.8
---------------------------------------------------------------------------
Group total 482.4 489.4 441.0 420.5 400.6 398.9 376.1
---------------------------------------------------------------------------
Operating profit / loss
Building and Energy 0.5 1.4 -1.8 -4.5 -1.4 -1.9 -2.9
Filtration 7.0 9.4 7.5 -6.9 5.3 4.4 0.9
Food and Medical 1.6 5.3 4.0 1.7 2.6 4.2 0.9
Home and Personal 2.6 1.3 0.4 -18.3 2.1 -0.4 -2.3
Label and Processing 7.7 14.2 5.3 -0.9 5.0 3.4 -4.3
Other operations and eliminations -2.6 -1.8 -1.4 2.2 -0.6 0.1 -3.0
---------------------------------------------------------------------------
Group total 16.9 29.8 14.0 -26.6 13.1 9.7 -10.7
---------------------------------------------------------------------------
--------------------------------------------------------------------------------
KEY FIGURES QUARTERLY Q3 Q2 Q1 Q4 Q3 Q2 Q1
EUR million 2010 2010 2010 2009 2009 2009 2009
--------------------------------------------------------------------------------
Net sales 482.4 489.4 441.0 420.5 400.6 398.9 376.1
Operating profit / loss 16.9 29.8 14.0 -26.6 13.1 9.7 -10.7
Profit / loss before taxes 8.3 22.5 7.4 -33.4 7.3 4.7 -18.6
Profit / loss for the period 4.1 15.1 5.5 -27.9 4.9 2.5 -12.4
--------------------------------------------------------------------------------
Gearing ratio, % 47.7 50.3 55.3 57.7 81.9 92.0 99.8
Return on capital employed
(ROCE), % 6.0 10.9 5.2 -9.4 4.8 3.2 -3.3
Basic earnings per share *, EUR 0.06 0.29 0.09 -0.61 0.10 0.05 -0.26
Average number of shares during
the period, 1000's 46,517 46,596 46,642 46,671 46,671 46,671 46,671
--------------------------------------------------------------------------------
* With the effect of interest on hybrid bond for the period, net of tax
CALCULATION OF KEY FIGURES
Interest-bearing
net liabilities
Interest-bearing loans and borrowings - Cash and cash equivalents - Other
investments (current)
Equity ratio, %
Total equity/
x 100
Total assets -
Advances received
Gearing ratio, %
Interest-bearing net
liabilities/ x 100
Total equity
Return on equity
(ROE), %
Profit (loss) for the
period/ x 100
Total equity
(annual average)
Return on capital
employed (ROCE),
%
Profit (loss) before taxes + Financing
expenses/ x 100
Total assets (annual average) - Non-interest bearing
liabilities (annual average)
Basic earnings
per share, EUR
Profit (loss) for the period - Non-controlling interest - Interest on hybrid
bond for the period after taxes/
Average number of
shares during the
period
Diluted earnings
per share, EUR
Profit (loss) for the period - Non-controlling interest - Interest on hybrid
bond for the period after taxes/
Average diluted
number of shares
during the period
Equity per share,
EUR
Equity
attributable to
owners of the
parent/
Number of shares
at the end of the
period
--------------------------------------------------------------------------------
* The personnel figures were calculated as man-years
[HUG#1455218]
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