2013-04-18 07:30:00 CEST
2013-04-18 07:30:08 CEST
REGULATED INFORMATION
Trainer's House Oyj - Interim report (Q1 and Q3)
TRAINERS’ HOUSE GROUP’S INTERIM REPORT FOR 1 JANUARY – 31 MARCH 2013
Espoo, 2013-04-18 07:30 CEST (GLOBE NEWSWIRE) -- TRAINERS' HOUSE PLC, INTERIM
REPORT, 18 APRIL 2013 AT 8:30
Trainers' House posted a positive result for the first quarter of 2013
January - March 2013 in brief (the figures are figures for the company's
continuing operations)
-- net sales amounted to EUR 2.9 million (EUR 3.9 million)
-- operating profit (EBIT) before non-recurring items and depreciation
resulting from the allocation of acquisition cost was EUR 0.2 million (EUR
0.5 million), or 5.7% of net sales (14.1%)
-- operating result was EUR 0.04 million (EUR 0.1 million), or 1.4% of net
sales (3.6%)
-- cash flow from operating activities was EUR 1.1 million (EUR 0.3 million)
-- earnings per share were EUR 0.00 (EUR 0.00)
Key figures at the end of the first quarter of 2013
-- liquid assets totalled EUR 2.6 million (EUR 3.5 million)
-- interest-bearing liabilities amounted to EUR 5.2 million (EUR 8.6 million),
and interest-bearing net debt totalled EUR 2.6 million (EUR 5.1 million)
-- gearing was 15.6% (30.5%)
-- the equity ratio was 62.1% (54.4%)
OUTLOOK FOR 2013
Trainers' House estimates net sales for 2013 to remain lower than in 2012, and
operating profit before non-recurring items and depreciation resulting from the
allocation of acquisition cost to be at approximately the same level as in
2012.
REPORT OF ARTO HEIMONEN, CEO
As expected, the first quarter of 2013 was challenging as regards the operating
result but the company posted a positive result. The company is increasing its
focus on services related to customers' change projects and quantifiable
results.
At the same time, the company reorganised and increased the efficiency of its
operations after the codetermination negotiations that were concluded in early
2013. The result for the first quarter is burdened by a non-recurring cost of
EUR 0.1 million related to the codetermination negotiations. The personnel
reductions and other streamlining measures are expected to create annual
savings totalling EUR 0.9 million. These cost-saving measures have been
successfully launched. The savings will be realised in full during the third
quarter.
For more information, please contact:
Arto Heimonen, CEO, tel. +358 40 412 3456
Mirkka Vikström, CFO, tel. +358 50 376 1115
REVIEW OF OPERATIONS
Codetermination negotiations concerning the entire Trainers' House Group were
initiated in January and concluded in February. As a result of the
negotiations, a total of 9 employment contracts in the Group were terminated.
The personnel reductions costs and estimated other non-recurring costs of the
restructuring are EUR 0.1 million.
During the period, the company has focused on a change in its operating model,
as well as the development of a product and service model that provides
quantifiable results to customers.
The change projects executed by Trainers' House are usually connected with
clarifying our customers' business strategies; marketing the strategies; and
implementing them by spurring sales, by enhancing customer service (for
example, through service design), and by developing the work of leaders and
supervisors along with the skills of their subordinates. Managing work capacity
through physical and mental coaching holds an important role in an increasing
number of customer projects.
The starting point for each change projects is a situation prevailing in the
customer organisation, which is used as a basis for setting realistic targets
for the desired results and the changes in activities required by these. To
support the change, an internal coach network is set up to continue to anchor
the change in the organisation.
The results of customer projects are verified by auditing customers' everyday
work and by bringing in management systems to help monitor the activities and
results. In January, the company launched a new version of its Pulssi (Pulse)
monitoring system. The service has been well received by the customers.
FINANCIAL PERFORMANCE
Net sales development in the first quarter was weaker than in 2012. Operating
profit in the first quarter before non-recurring items and depreciation
resulting from the allocation of acquisition cost was also lower year-on-year.
As the depreciation resulting from the allocation of acquisition cost was
completed during the last quarter of 2012, operating result before
non-recurring items improved year-on-year. The result for the first quarter is
burdened by the personnel reductions costs and other non-recurring costs
related to the codetermination negotiations in January and February that
amounted to EUR 0.1 million.
Net sales from continuing operations in the quarter came to EUR 2.9 million
(EUR 3.9 million). Operating profit from continuing operations (operating
profit before depreciation resulting from the allocation of the acquisition
cost of Trainers' House Oy and non-recurring items) was EUR 0.2 million, or
5.7% of net sales (EUR 0.5 million, or 14.1%). Profit for the period was EUR
0.03 million, or 1.1% of net sales (EUR 0.1 million, or 2.6%).
Result
The comparative figures used for reporting on operating profit include the
operating profit reported as well as operating profit before depreciation of
allocated acquisition cost related to the acquisition of Trainers' House Oy and
non-recurring items (i.e., operating profit, EBIT). According to the company's
management, these figures provide a more accurate view of the company's
productivity.
The following table itemises the Group's key figures (in thousands of euros
unless otherwise noted:
1-3/2013 1-3/2012
Net sales 2,945 3,901
Expenses:
Personnel-related expenses -1,576 -1,803
Other expenses -1,132 -1,458
EBITDA 237 640
Depreciation of non-current assets -70 -91
Operating profit before depreciation 167 549
of acquisition cost
% of net sales 5.7 14.1
Depreciation of allocation of -410
acquisition cost *)
Operating profit before non-recurring 167 140
items
Non-recurring items **) -125
EBIT 42 140
% of net sales 1.4 3.6
Financial income and expenses 1 -21
Profit/loss before tax 43 119
Tax ***) -11 -18
Profit/loss for the period 32 101
% of net sales 1.1 2.6
*) Of the purchase price of Trainers' House Oy in 2007, EUR 10.2 million has
been allocated to intangible assets with a limited useful life. This item was
depreciated in full during the period 2007-2012.
**) Non-recurring items in 2013 include a restructuring provision in the amount
of EUR 0.1 million.
**) The tax included in the income statement is deferred. Taxes recognised in
the income statement have no effect on cash flow. On 31 March 2013, the
company's balance sheet included deferred tax assets from losses carried
forward in the amount of EUR 0.4 million. Of the deferred tax assets, EUR 0.3
million will expire in 2019 and EUR 0.1 million in 2021.
The following table itemises the distribution of net sales from continuing
operations and shows the quarterly profit/loss from the start of 2012, in
thousands of euros.
Q112 Q212 Q312 Q412 2012 Q113
-------------------------------------------------
Net sales 3901 3536 2485 3381 13302 2945
-------------------------------------------------
Operating 549 200 -20 453 1182 167
profit
before
depreciation
of
acquisition
cost *)
-------------------------------------------------
Operating 140 -210 -338 317 -91 42
profit
-------------------------------------------------
*) excluding non-recurring items
LONG-TERM OBJECTIVES
The company's long-term objective is profitable growth.
FINANCING, INVESTMENTS AND SOLVENCY
In connection with the merger of Trainers' House Oy and Satama Interactive Plc,
the company concluded a loan agreement in the amount of EUR 40 million. At the
end of the reporting period, the company had loans related to this loan
agreement negotiated in late 2011 in the amount of EUR 4.9 million.
Hybrid bond
On 15 January 2010, Trainers' House Plc issued a EUR 5.0 million domestic
hybrid bond. Interest of EUR 1.0 million related to the hybrid bond was
recognised in shareholders' equity.
According to the terms of the hybrid bond, the company has the right to decide,
subject to certain limitations specified in the terms, either to pay the
interest on the hybrid bond annually or to postpone these payments. Interest in
the amount of EUR 0.5 million has been paid to the subscribers on 21 January
2011 and EUR 0.5 million on 20 January 2012. The interest paid reduces the
non-restricted equity and is not recognised as income.
In accordance with its stock exchange release dated 17 December 2012, Trainers'
House has decided to defer interest payments on the hybrid loan for the time
being. The purpose of the deferment of interest payments is to strengthen the
company's financial position and to ensure that the company fulfils the terms
of its loan agreement. According to the terms of the hybrid bond, the company
must pay the deferred interest and any interest accrued on it by the latest if,
for example, the company pays dividends in excess of the minimum dividend
stipulated in the Companies Act, or otherwise distributes equity to its
shareholders. The company aims to refinance the hybrid bond in its entirety in
the medium term.
Cash flow and financing
Cash flow from operating activities before financial items totalled EUR 1.1
million (EUR 0.8 million), and after financial items EUR 1.1 million (EUR 0.3
million).
Cash flow from investments totalled EUR 0.02 million (no investments in 2012).
Cash flow from financing came to EUR -0.1 million (EUR -0.1 million).
Total cash flow amounted to EUR 1.1 million (EUR 0.3 million).
On 31 March 2013, the Group's liquid assets totalled EUR 2.6 million (EUR 3.5
million). The equity ratio was 62.1% (54.4%). Gearing was 15.6% (30.5%). At the
end of the reporting period, the company had interest-bearing liabilities in
the amount of EUR 5.2 million (EUR 8.6 million).
Financial risks
Interest rate risk is managed by covering some of the risk with hedging
agreements. A bad-debt provision, which is booked on the basis of ageing and
case-specific risk analyses, covers risks to accounts receivable.
SHORT-TERM BUSINESS RISKS AND FACTORS OF UNCERTAINTY
Risks in the company's operating environment have remained unchanged. On
account of the project-based nature of the company's operations, the order life
cycle is short, which makes it more difficult to estimate future developments.
Long-term visibility remains limited due to the general economic situation.
Short-term risks
The Group's goodwill and deferred tax assets recognised in the balance sheet
were re-tested for impairment at the end of the quarter. No goodwill
write-downs were judged necessary from the results of this impairment testing.
If the company's profitability should fail to develop as predicted, or if
external factors beyond the company's control, such as interest rates, should
change significantly, there is a risk that some of the Group's goodwill may
have to be written down. Such a write-down would not affect the company's cash
flow.
At the end of the period under review, Trainers' House Plc's balance sheet
included deferred tax assets form losses carried forward in the amount of EUR
0.4 million. Of the deferred tax assets, EUR 0.3 million will expire in 2019
and EUR 0.1 million in 2021.
The company's new loan agreement, under which there were loans in the amount of
EUR 4.9 million at the end of the reporting period, includes standard
covenants, including one concerning the ratio of net debt to EBITDA.
If the company's profitability should fail to develop as expected, there would
be a risk of the company being unable to fulfil the covenants, which would
increase financial expenses.
Risks are discussed in more detail in the annual report and on the company's
website, at www.trainershouse.fi > Investors.
PERSONNEL
At the end of March 2013, the Group employed 94 (119) people.
DECISIONS REACHED AT THE ANNUAL GENERAL MEETING
The Annual General Meeting of Trainers' House Plc was held in Espoo on 19 March
2013.
In accordance with the proposal of the Board of Directors, the Annual General
Meeting decided that no dividend be paid.
In accordance with the proposal of the Board of Directors, the Annual General
Meeting decided that the company's premium fund be decreased by EUR 823,478.02
to cover the parent company's losses. On 31 December 2012, before the
offsetting of losses, the parent company's premium fund amounted to EUR
5,355,637.99. After the decrease, the premium fund amounts to EUR 4,532,159.97.
The Annual General Meeting adopted the company's Financial Statements and
discharged the CEO and the members of the Board of Directors from liability for
the period 1 January to 31 December 2012.
It was confirmed that the Board of Directors shall consist of five (5) members.
Aarne Aktan, Jarmo Hyökyvaara, Tarja Jussila and Jari Sarasvuo were re-elected
as members of the Board of Directors. Vesa Honkanen was elected a new member of
the Board. In its assembly meeting held after the AGM, the Board of Directors
elected Aarne Aktan as the Chairman of the Board.
The Annual General Meeting decided on a monthly emolument for a Board member of
EUR 1,500 and of EUR 3,500 for the Chairman of the Board.
Authorised Public Accountants Ernst & Young Oy were elected as the company's
auditors.
In accordance with the proposal of the Board of Directors, the Annual General
Meeting held on 21 March 2012 decided to authorise the Board of Directors to
decide on a share issue, on transfer of own shares and on the granting of
special rights entitling to shares, on one or several occasions. The number of
shares to be granted or transferred on the basis of the authorisation may not
exceed 13,000,000 shares. A share issue, transfer of own shares and the
granting of other special rights entitling to shares may take place in
deviation of the shareholders' pre-emptive subscription rights (a private
placement). The authorisation is valid until 30 June 2015.
SHARES AND SHARE CAPITAL
The shares of Trainers' House Plc are listed on NASDAQ OMX Helsinki Ltd under
the symbol TRH1V.
At the end of the period under review, Trainers' House Plc had issued
68,016,704 shares and the company's registered share capital amounted to EUR
880,743.59. No changes took place in the number of shares or share capital
during the period under review.
Share performance and trading
In the period under review, 2.6 million shares in total, or 3.9% of the average
number of all company shares (1.6 million shares, or 2.4%), were traded on the
Helsinki stock exchange, for a value of EUR 0.3 million (EUR 0.3 million). The
period's highest share quotation was EUR 0.11 (EUR 0.22), the lowest EUR 0.09
(EUR 0.15) and the closing price EUR 0.09 (EUR 0.15). The weighted average
price was EUR 0.10 (EUR 0.18). At the closing price on 31 March 2013, the
company's market capitalisation was EUR 6.1 million (EUR 10.2 million).
PERSONNEL OPTION PROGRAMMES
Trainers' House Plc has two option programmes for its personnel, included in
the personnel's commitment and incentive scheme.
The Annual General Meeting held on 25 March 2010 decided to initiate an
employee option programme for key employees at Trainers' House and its
subsidiaries.
The number of option rights granted shall not exceed 2,000,000, and the option
rights shall entitle their holders to subscribe for no more than 2,000,000 new
shares or treasury shares in total. The subscription price for the 2010B
warrant is EUR 0.29. The subscription period for shares converted under the
warrant 2010B is from 1 September 2012 to 31 December 2013. The total number of
warrants granted to the personnel is 0.9 million. No shares have been
subscribed under the warrants.
The Annual General Meeting held on 21 March 2012 decided to initiate an
employee option programme for key employees in Trainers' House and its
subsidiaries.
The number of option rights granted shall not exceed 5,000,000, and the option
rights shall entitle their holders to subscribe for no more than 5,000,000 new
shares or treasury shares in total. Of the warrants, 3,000,000 will be titled
2012A and 2,000,000 will be titled 2012B. The subscription price for the
warrants is EUR 0.16. The subscription period for shares converted under the
2012A warrant is from 1 September 2013 to 31 December 2014, and for shares
converted under the 2012B warrant from 1 September 2014 to 31 December 2015.
The options have not yet been offered.
CONDENSED FINANCIAL STATEMENTS AND NOTES
This report was compiled in accordance with the IAS 34 standard. This interim
report has been prepared in accordance with the IFRS standards and
interpretations adopted in the EU, valid on 31 December 2012.
In producing this interim report, Trainers' House has applied the same
accounting principles for key figures as in its 2012 financial statements. The
calculation of key figures is described on page 92 of the financial statements
included in the Annual Report 2012.
The figures given in the interim report are unaudited.
INCOME STATEMENT, IFRS (kEUR)
Group Group Group
01/01- 01/01- 01/01-
31/03/13 31/03/12 31/12/12
CONTINUING OPERATIONS
NET SALES 2,945 3,901 13,302
Other income from operations 177 164 797
Costs:
Materials and services -323 -538 -1,562
Personnel-related expenses -1,691 -1,803 -6,696
Depreciation -70 -500 -1,689
Other operating expenses -996 -1,083 -4,244
Operating profit/loss 42 140 -91
Financial income and expenses 1 -21 -303
Profit/loss before tax 43 119 -394
Tax *) -11 -18 151
PROFIT/LOSS FOR THE PERIOD 32 101 -243
TOTAL COMPREHENSIVE 32 101 -243
INCOME FOR THE YEAR
Profit/loss attributable to:
Owners of the parent company 32 101 -243
Total comprehensive income
attributable to:
Owners of the parent company 32 101 -243
Earnings per share, undiluted:
EPS result for the period from 0.00 0.00 -0.00
continuing operations
EPS attributable to hybrid -0.00 -0.00
bond investors
EPS continuing operations 0.00 0.00 -0.00
EPS attributable to equity 0.00 0.00 -0.00
holders of the parent company
EPS result for the period 0.00 0.00 -0.00
Diluted earnings per share are the same as undiluted earning per share.
*) The tax included in the income statement is deferred.
BALANCE SHEET IFRS (kEUR)
Group Group Group
31/03/13 31/03/12 31/12/12
ASSETS
Non-current assets
Property, plant and equipment 321 551 380
Goodwill 9,135 9,135 9,135
Other intangible assets 9,698 10,668 9,710
Other financial assets 202 202 202
Other receivables 1,475 1,607 1,490
Deferred tax receivables 371 484 382
Total non-current assets 21,202 22,646 21,299
Current assets
Inventories 10 11 10
Accounts receivables and 2,760 4,540 3,776
other receivables
Cash and cash equivalents 2,595 3,534 1,520
Total current assets 5,366 8,085 5,306
TOTAL ASSETS 26,568 30,731 26,605
SHAREHOLDERS' EQUITY AND
LIABILITIES
Equity attributable to equity
holders of the parent company
Share capital 881 881 881
Premium fund 4,253 5,077 5,077
Distributable non-restricted 31,872 31,872 31,872
equity fund
Other equity fund 4,962 4,962 4,962
Retained earnings -25,542 -26,074 -26,397
Total shareholders' equity 16,426 16,718 16,394
Long-term liabilities
Deferred tax liabilities 2,507 2,756 2,507
Other long-term liabilities 3,052 6,433 3,074
Accounts payable and other 4,582 4,825 4,629
liabilities
Total liabilities 10,142 14,013 10,211
TOTAL SHAREHOLDERS' EQUITY AND 26,568 30,731 26,605
LIABILITIES
CASH FLOW STATEMENT, IFRS (kEUR)
Group Group Group
01/01- 01/01- 01/01-
31/03/13 31/03/12 31/12/12
Profit/loss for the period 32 101 -243
Adjustments to profit/loss 150 559 1,726
for the period
Change in working capital 934 169 -100
Financial items -1 -519 -774
Cash flow from operations 1,114 309 608
Investments in tangible and -49
intangible assets
Repayment of loan receivables 15 1,200
Cash flow from investments 15 1,152
Repayment of long-term loans -3,297
Repayment of finance lease -55 -55 -223
liabilities
Cash flow from financing -55 -55 -3,520
Change in cash and cash 1,075 254 -1,760
equivalents
Opening balance of cash and 1,520 3,280 3,280
cash equivalents
Closing balance of cash and 2,595 3,534 1,520
cash equivalents
CHANGE IN SHAREHOLDERS' EQUITY (kEUR)
Equity attributable to equity holders of the parent company
A. Share capital
B. Premium fund
C. Distributable non-restricted equity
D. Other equity fund
E. Retained earnings
F. Total
A. B. C. D. E. F.
----------------------------------------------------------
Equity 881 13,943 31,872 4,962 -35,031 16,627
01/01/2012
----------------------------------------------------------
Other 101 101
comprehensive
income
----------------------------------------------------------
Hybrid bond -23 -23
----------------------------------------------------------
Sharebased 13 13
payments
----------------------------------------------------------
Decrease of -8,866 8,866 0
share premium
fund to cover
losses
----------------------------------------------------------
Equity 881 5,077 31,872 4,962 -26,074 16,718
31/03/2012
----------------------------------------------------------
----------------------------------------------------------
Equity 881 5,077 31,872 4,962 -26,397 16,394
01/01/2013
----------------------------------------------------------
Other 32 32
comprehensive
income
----------------------------------------------------------
Decrease of -823 823 0
share premium
fund to cover
losses
----------------------------------------------------------
Equity 881 4,253 31,872 4,962 -25,542 16,426
31/03/2013
----------------------------------------------------------
RESTRUCTURING PROVISION (kEUR) Group Group Group
01/01- 01/01- 01/01-
31/03/13 31/03/12 31/12/12
Provisions 1 January 240 258 258
Provisions increased 125
Provisions used -57 -19
Provisions 31 March/December 308 258 240
PERSONNEL Group Group Group
01/01- 01/01- 01/01-
31/03/13 31/03/12 31/12/12
Average number of personnel 101 119 115
Personnel at the end of 94 119 108
the period
COMMITMENTS AND CONTINGENT Group Group Group
LIABILITIES (kEUR) 31/03/13 31/03/12 31/12/12
Collaterals and contingent 10,317 11,510 10,716
liabilities given for
own commitments
Interest rate swaps:
Fair value 5,214
OTHER KEY FIGURES Group Group Group
31.03.13 31.03.12 31.12.12
Equity-to-assets ratio (%) 62.1 54.4 62.0
Net gearing (%) 15.6 30.5 22.5
Shareholders' equity/share (EUR) 0.24 0.25 0.24
Return on equity (%) -1.9 -70.5 -1.5
Return on investment (%) 0.3 -46.9 0.9
Return on equity and return on investment have been calculated for the previous
12 months.
Helsinki 18 April 2013
TRAINERS' HOUSE PLC
BOARD OF DIRECTORS
For more information, please contact:
Arto Heimonen, CEO, tel. +358 40 412 3456
Mirkka Vikström, CFO, tel. +358 50 376 1115
DISTRIBUTION
OMX Nordic Exchange, Helsinki
Main media
www.trainershouse.fi > Investors
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