2012-10-31 07:30:00 CET
2012-10-31 07:30:53 CET
REGULATED INFORMATION
Incap - Interim report (Q1 and Q3)
INCAP GROUP INTERIM REPORT JANUARY-SEPTEMBER 2012: PROFITABILITY IMPROVED FURTHER - POSITIVE OPERATING PROFIT AND NET PROFIT FOR SECOND AND THIRD QUARTERS
Incap Corporation Stock Exchange Release 31 October 2012 at 8:30 a.m.
INCAP GROUP INTERIM REPORT JANUARY-SEPTEMBER 2012: PROFITABILITY IMPROVED
FURTHER - POSITIVE OPERATING PROFIT AND NET PROFIT FOR SECOND AND THIRD QUARTERS
* Revenue in January-September was EUR 49.6 million (Jan-Sep 2011: EUR 52.0
million)
* Revenue in India increased by about 35% year-on-year exceeding expectations
* January-September operating profit (EBIT) improved and was EUR -0.05 million
(EUR -1.0 million)
* Operating profit (EBIT) for the third quarter was EUR 0.3 million (0.04) and
net profit for the period was EUR 0.04 million (-0.6)
* Quarterly operating profit (EBIT) has been better year-on-year for eight
consecutive quarters
* January-September earnings per share were EUR -0.02 (EUR -0.15).
* Incap reiterates its previous guidance and estimates that its operating
profit (EBIT) for the second half of the year would be positive and full-
year operating profit would be clearly better than in 2011, when it amounted
to EUR -1.6 million.
This interim report has been prepared in accordance with international financial
reporting standards (IFRS) - IAS 34 Interim Financial Reporting standard. The
accounting principles for the interim report are the same as those used in the
preparation of the 2011 financial statements. Unless otherwise stated, the
comparison figures refer to the same period in the previous year. This interim
report is unaudited.
Sami Mykkänen, President and CEO of Incap Group:"The company's strategic restructuring that has lasted for several years has
been completed in the summer, when the Helsinki factory's production was
transferred to the company's other factories. Incap now has one factory in each
country where it operates - Finland, Estonia and India - which provides a good
foundation for improving profitability and competitiveness.""The demand for energy efficiency sector's products has stayed on a pleasing
level during the reporting period in both Europe and Asia. Revenue of the Indian
operations has increased more than expected and production volumes have reached
a profitable level. Deliveries of well-being technology products have decreased
due to, among other reasons, some of the products being omitted from the
production programme as expected.""Improving profitability has been our main target, and recent profit development
shows that we have succeeded in laying a sustainable foundation for growth in
accordance with our strategy. We expect the favourable development to continue
and estimate that the operating profit (EBIT) for the second half of the year
will be positive.""The comprehensive financing solution negotiated in the spring stabilised our
financing structure. We are currently preparing for the redemption of the
convertible bond agreed upon in the spring, which is supposed to take place
during 2012. Our original intention was to finance the redemption through a
share issue in the autumn, but we are currently also investigating other
possible financing tools."
Revenue and profitability July-September 2012
Revenue for the third quarter amounted to EUR 15.7 million, down 14% year-on-
year. The decrease in revenue was mainly due to certain products manufactured at
the Helsinki factory being omitted from the production programme. Revenue from
customer accounts served from the Indian plant has increased more than expected,
by 37%, especially with international but also with locally operating customers.
.
The operating profit (EBIT) for July-September was approximately EUR 0.3
million, i.e. clearly better than in the corresponding period last year. The
operating profit was positive, as it also was in the previous quarter in April-
June. Measures to lower costs were continued, and the decrease in personnel
costs and other fixed costs had a positive effect on profitability.
The expanded premises of the Kuressaare property entered production use, which
will improve the factory productivity. Production activity at the Helsinki
factory ended, and manufacturing of sheet-metal mechanics was transferred
partially to the company's Vaasa plant and partially to subcontractors. The
closure of the factory and centralisation of production in Vaasa and Kuressaare
are expected to result in savings of approximately EUR 1.6 million in 2013,
comprised mainly of personnel costs.
Some of the production equipment of the Helsinki factory was transferred to
Vaasa, some was sold. The net gains from the sale of equipment are recognised
under other operating income.
Quarterly comparison 7-9/ 4-6/ 1-3/ 10-12/ 7-9/ 4-6/ 1-3/
(EUR thousands) 2012 2012 2012 2011 2011 2011 2011
------------------------------------------------------------------------------
Revenue 15,701 18,378 15,564 16,906 18,286 17,694 16 005
280 13 -345 -609 35 -623 -423
Operating profit/loss (EBIT)
44 352 -711 -1,288 -576 - 1,182 -951
Net profit/loss
Earnings per share, EUR 0.00 0.02 -0.04 - 0.07 -0.03 -0.06 -0,05
Revenue and profitability January-September 2012
Revenue for January-September amounted to EUR 49.6 million, down approximately
5% year-on-year. Deliveries to customers in the energy efficiency industry
remained at a good level, and the demand for rotor components, inverters and UPS
products has increased clearly. Revenue in Indian operations increased by about
35% year-on-year.
The operating result for January-September was EUR -0.05 million, which is
almost a million euros better than the corresponding period for the previous
year. Particularly the profitability in the Indian operations has developed
strongly. Material expenses and other variable production costs decreased year-
on-year, and also fixed costs went down. In order to improve the cost structure,
Group Services, among other functions, were reorganised and tasks were
centralised in the company's Tallinn office. Financial performance was burdened
by expenses related to the closure of the Helsinki plant during the period under
review.
Quarterly comparison 1-9/2012 1-9/2011 Change % 1-12/2011
(EUR thousands)
-------------------------------------------------------------------
Revenue
49 643 51 985 -5 68,890
Operating profit/loss (EBIT) -52 -1,010 -95 -1,619
Net profit/loss -314 - 2,709 -77 -3,997
Earnings per share, EUR -0.02 -0.15 -79 -0.21
Net financial expenses decreased compared to the previous year and amounted to
EUR 0.2 million (EUR 1.7 million). The decrease was due to EUR 1.1 million of
financing income recognised in June as the result of the dilution of the
convertible bond. Depreciation stood at EUR 1.2 million (EUR 1.6 million). The
loss for the period totalled EUR -0.3 million (EUR -2.7 million).
The return on investment was 6.8% (-4.2%) and return on equity was -27.6 % (-
87.5%). Earnings per share were EUR -0.02 (EUR -0.15).
Balance sheet, financing and cash flow
The Group's balance sheet total was EUR 35.2 million (EUR 41.5 million). The
Group's equity at the close of the period was EUR 1.7 million (EUR 2.6 million).
Debt totalled EUR 33.4 million (EUR 38.9 million), of which interest-bearing
debt came to EUR 21.1 million (EUR 25.2 million). The non-current debt - EUR
1.9 million - is comprised of the new 2012 convertible bond. The parent
company's equity totalled EUR 11.6 million, representing 56% of the share
capital (EUR 13.7 million, 67%). This exceeds the minimum equity limit pursuant
to the Limited Liability Companies Act by approx. EUR 1.3 million.
The Group's equity ratio was 4.9% (6.3%). Interest-bearing net liabilities
decreased to EUR 20.8 million (24.9 million), and the gearing ratio was 1,205%
(947%).
Incap Group's current interest-bearing loans and borrowings on 30 September
2012 amounted to EUR 19.1 million. EUR 15.6 million of this is a loan from
financial institutions, of which EUR 4.1 million concerns the Indian subsidiary.
The parent company uses factoring in Finland and Estonia, and it is included in
current liabilities.
Of the company's loans, only financial leasing and a part of the convertible
bond 2012 are classified as long-term. The other bank loans are included in
current financing loans based on the loan period or due to breach of covenants.
Incap's loans from financial institutions and other loans on 30 September 2012
amounted to EUR 21.1 million. EUR 15.6 million of this were loans from financial
institutions (30 June 2012: EUR 17.4 million). Total amount of the loans from a
Finnish bank is EUR 5.2 million, and besides these the company has a total of
EUR 6.3 million of the credit line and the factoring credit line in use, while
unused overdraft of the credit was EUR 3.2 million. The bank loans and credit
lines in India and Estonia amount to a total of EUR 2.2 million. Finnfund's
investment of EUR 1.9 million in Incap's Indian operations is included in loans
from financial institutions.
Besides loans from financial institutions Incap also has a total of EUR 5.4
million other loans (30 June: EUR 5.8 million). They include a convertible bond
for 2007, of which EUR 1.1 million is due on 30 November 2012 and EUR 1.2
million is due on 31 December 2012. The convertible bond 2012 amounts to EUR
2.9 million and is due in May 2017. Other loans comprise financing leasing in
Finland and Estonia, amounting to a total of EUR 0.1 million. Last payment of
the loan given by the municipality of Sotkamo, i.e. EUR 43 thousand, was paid
after the reporting period in the beginning of October.
Instalments and interests of loans:
(EUR thousands) Instalments Interests 30 Sep 2012
----------------------------------------------------
Less than 6 months 16,473 166 16,639
6-12 months 768 1 769
1-5 year 3,813 945 4,759
More than 5 years 0 0 0
----------------------------------------------------
21,054 1,112 22,166
----------------------------------------------------
At the end of the period under review, EUR 13.7 million of the loans were
guaranteed (guarantees EUR 14.4 million), and the rest were unguaranteed. The
securities for the loans are a EUR 12.1 million mortgages on company assets, a
EUR 1.5 million and a EUR 0.7 million mortgage on the production facilities in
Vuokatti and India, respectively.
Incap's liability for debts decreased in May 2012 with the value of the 2007
convertible bond decreasing by approximately EUR 1.1 million in connection with
the financing arrangement. The decrease in value was due to the company
committing to redeem part of the rights of conversion of the convertible bond at
a price that was 28% below the nominal value of the rights on average.
During the third quarter, approximately EUR 0.1 million of deferred tax assets
were cleared from the group's balance sheet based on taxable income accumulated
in the Indian subsidiary. On 30 September 2012, confirmed tax losses for which
no deferred tax asset was recognised amounted to EUR 8.1 million.
The Group's quick ratio was 0.5 (0.4) and the current ratio 0.8 (0.8). Cash flow
from operating activities was positive for the second quarter in a row, EUR 1.6
million (EUR -3.6 million). The Group's cash and cash equivalents amounted to
EUR 0.2 million (EUR 0.3 million) on 30 September 2012. The change in cash and
cash equivalents showed a decrease of EUR -0.1 million (a decrease of EUR 0.3
million).
The company succeeded in its aim to reduce the value of inventories and release
capital from inventories. The value of inventories decreased from EUR 11.4
million at the beginning of the year to EUR 10.3 million during the period under
review. Increase in demand in the energy efficiency sector increased the amount
of inventories, especially at the Indian factory. On the other hand, the value
of inventories decreased as the result of the Helsinki factory closing down. At
the end of the comparison period in September 2011, the value of inventories was
EUR 12.4 million.
The factors associated with the Group's cash flow, financing and liquidity are
also described under "Short-term risks and factors of uncertainty concerning
operations."
Private placement in April 2012
On 11 April 2012, the Board exercised its authorisation granted by the 2011
Annual General Meeting and issued a total of 2,168,100 new shares to the major
shareholders of the company. The issue was subscribed for in full at a price of
EUR 0.35 per share. In addition to the four major shareholders, also all of the
Board members and the CEO of the Group subscribed for shares.
The subscription price, totalling approximately EUR 759,000, was recognised in
the reserve for invested non-restricted equity. The new shares have been entered
in the Trade Register on 18 July 2012, after which the total number of shares in
the company increased to 20,848,980 shares. Incap prepared a prospectus for the
listing of the new shares, and the new shares became available for public
trading at the Helsinki Stock Exchange on 18 September 2012 after the prospectus
was approved.
Convertible bond 2012
The convertible bond issued by Incap in 2007 expired in May. Some of the
convertible bond holders converted the loan to a new convertible bond, and its
subscriptions were approved by the Board on 25 May 2012. The issue rate of the
convertible bond is 100% and an annual fixed interest of 7% will be paid on the
loan after each 12-month period. The subscription price of the new bond was paid
so that one loan share of the 2007 convertible bond was converted to one share
of the 2012 convertible bond. The nominal value of the loan is EUR 2,916,000,
distributed into 540 loan shares with a nominal value of EUR 5,400 each. The
convertible bond will mature on 25 May 2017.
Capital expenditure
Investments amounted to EUR 0.1 million (EUR 0.2 million) during the period.
Personnel and management
At the close of the period, Incap Group had a payroll of 667 employees (772). Of
the personnel, 56% worked in India (51%), 30% in Estonia (27%) and 14% in
Finland (22%).
HR Director and member of the Group Management Team Kirsi Hellsten gave notice
to accept a position with another company at the beginning of November.
Shares and shareholders
Incap Corporation has one series of shares and the number of shares at the end
of the period was 20,848,980. During the period, the share price varied between
EUR 0.27 and EUR 0.65 (EUR 0.40 and 0.64). The closing price for the period was
EUR 0.27 (EUR 0.47). During the review period, the trading volume was 1,499,294
shares or 7.2% of outstanding shares (606,719 or 3.2%).
At the end of the period, the company had 1,101 shareholders (1,059). Foreign or
nominee-registered owners held 0.5% (0.6%) of all shares. The company's market
capitalisation on 30 September 2012 was EUR 5.6 million (EUR 8.8 million). The
company does not hold any of its own shares.
Announcements in accordance with Section 9 of Chapter 2 of the Securities Market
Act on changes in holdings
Once the new shares subscribed for in the April private placement were
registered, Kalevi Laurila's holding of Incap's shares exceeded the 5%
threshold.
Short-term risks and factors of uncertainty concerning operations
The risks and uncertainty factors related to Incap's operations are described in
more detail in the prospectus (in Finnish) dated 14 September 2012. The
prospectus is available on the company's website, and copies of it are delivered
on request.
There are risks associated with the continuity of Incap's business operations,
the most significant of which refer to the following factors:
* arranging financing by way of a share issue or another arrangement during
2012 in order to redeem the convertible bond
* fulfilling the terms and conditions set by the bank in order to withdraw the
second instalment of additional financing
* reaching the covenant levels required for the extension of loans from
financial institutions
* sufficiency of working capital
* implementation of the development measures concerning profitability and
inventories
* global economic development and its impacts on the market position of the
company's customers and demand
* valuation of property and utilisation of the deferred tax asset.
Financing required for redeeming the convertible bond 2007
The EUR 6.75 million convertible bond issued by Incap in 2007 matured on 25 May
2012. The company agreed on the refinancing of the convertible bond in May 2012
so that the company redeems the loan shares of some of convertible bond holders
and some of the convertible bond holders convert the loan to a new convertible
bond. The company agreed to redeem or purchase some of the loan shares at a
total price of EUR 2,768,040, which is 28% under the nominal value on average.
The loan shares to be redeemed represent a total of EUR 3,834,000 of the
principal of the 2007 convertible bond. The loan shares must be redeemed during
2012 following the schedule agreed upon with each holder.
Part of the redemption was carried out in May-June 2012. On 30 September 2012,
the remaining amount to be redeemed was EUR 2,368,440. The company aims to
obtain the funds required for the redemption through a share issue or another
financing agreement.
Under the terms and conditions of agreement, one subscriber for the convertible
bond 2012, accounting for EUR 999,000 of the bond, has the right to terminate
the financing agreement if the redemption of the 2007 convertible bond does not
take place by the end of 2012. This part of the convertible bond 2012 is
recognised under current liabilities.
Withdrawing the second instalment of the granted additional financing
Incap negotiated on a financing agreement whereby the company's domestic
financier banks renewed the maturing loans and granted new loans totalling EUR
2.5 million. Of the loan, EUR 1 million was withdrawn in July 2012. The second
instalment of the financing - EUR 1.5 million - cannot be withdrawn until the
2007 convertible bond has been redeemed in full and the bank has approved the
achieved level of net IBD/EBITDA.
Debt financing and covenants
Total debt of Incap at the end of reporting period amounted to EUR 21.1 million.
The company's loans, credit lines and factoring credit lines granted by a
Finnish bank totalled EUR 11.5 million on 30 September 2012. These loans involve
the following covenants:
Equity ratio Net IBD/EBITDA
31 Dec 2012 at least 10% up to 7
30 June 2013 onwards at least 15% up to 5
The covenants related to the loans were not met on 30 September 2012. On this
date, the company's equity ratio was 4.9% and net IBD/EBITDA was 14.7. The bank
has the right to terminate the agreements to expire after 60 days if any
covenant is not met on the testing date. On 23 August 2012, the company was
informed by the bank in writing that the bank will not exercise its right to
terminate the financing agreements, even though the covenants were not met. The
covenants will be tested again in December 2012 and every six months after that.
The additional loan of EUR 1 million, which was withdrawn in July, includes
besides the above covenants also the bank's right to terminate the agreement in
case the convertible bond 2007 is not redeemed during 2012 according to plan.
Based on the forecast drafted by Incap on 30 October 2012, the above covenants
will be met on the next testing date 31 December 2012, provided that the company
succeeds in obtaining funds for the redemption of the convertible bond with a
share issue as planned. Should the covenants referred to above or other ordinary
covenants associated with special circumstances not be met, Incap would not
probably be able to perform its obligations and it would have to start
negotiations on the rearrangement of funding.
Payment arrangement for tax liabilities
Incap has agreed on a payment arrangement concerning overdue value-added taxes,
payroll taxes and social security contributions with the Tax Administration. The
tax liabilities covered by the arrangement total approximately EUR 1.4 million,
and the last instalment under the agreement will take place in August 2014. In
accordance with the terms and conditions of agreement, the Tax Administration
has the right to terminate the agreement with immediate effect in case an
instalment is delayed.
Sufficiency of working capital
To assess its liquidity, Incap has prepared a 12-month cash flow projection for
the Group, based on its performance forecast for 2012 and the actual turnover of
its sales receivables, accounts payable and inventories. Based on the prepared
cash flow forecast, Incap's working capital does not correspond with the
company's needs for the next 12 months at the time of this interim report.
According to the company's estimate, about EUR 3-5 million of additional working
capital is needed.
However, the company's working capital will be sufficient for the next 12 months
if the following criteria are met:
* the company's eventual share issue and financing arrangements succeed as
planned, so that the company obtains funds for the redemption of the
convertible bond of 2007; and
* the bank accepts the achieved net IBD/EBITDA level, so that the second
instalment of the additional loan can be withdrawn; and
* the goals for the company's result and inventory turnover rate are achieved;
and
* the covenants for the company's loans from financial institutions are met,
or, should the covenants not be met, the bank will not exercise its right to
terminate the loan agreements.
Incap's management is confident that the company succeeds in the financing
negotiations and obtains financing for redeeming the convertible bond in line
with the contract. The strategic process of change has continued as planned; the
company closed down the Helsinki factory in the summer 2012 and transferred its
production to other units. This structural change and other efficiency
improvement measures are expected to improve profitability during the latter
half of 2012. In addition, the company will continue to take measures to ensure
that the goals for the company's result and inventory turnover are achieved.
Thus, the company estimates that it will be able to cover any possible working
capital deficit and ensure that the covenants related to the financing
agreements are met. However, should the covenants not be met and the financiers
would inform that they will make use of the covenants, the company should
initiate negotiations on the rearrangement of funding and on gaining new equity
or debt financing.
Development of customers' market situation and demand
Demand for Incap's services as well as the company's financial position are
affected by international economic trends and economic trends among Incap's
customer industries. The business environment has developed with more stability
in 2012 than in 2011, and the increasing uncertainty of the economic outlook has
not, at least for the time being, had negative impacts on the demand or
liquidity of the company's customers.
The company's sales are spread over several customer sectors, which balances out
the impact of the economic trends in different industrial sectors. The company's
sector, contract manufacturing, is highly competitive, and there are major
pressures on cost level management. The flexibility of the cost structure has
been increased by decentralising production in the different countries where the
company operates: Finland, Estonia and India. The focus of production activity
is on countries with competitive wages and general costs. Closing down the
Helsinki factory in connection with the change in the production structure will
improve profitability during the latter half of 2012, with less capital tied to
inventories and decreased fixed costs.
Valuation of property and utilisation of the deferred tax asset.
The company owns an 8,700 m² plant property in Vuokatti, built in 1978-2001. The
property and the related loans have been recognised as available for sale as of
the financial statements for 2010. The price estimate given by Catella Property
Oy on 23 January 2012 clearly exceeds the book value of the property. Incap has
signed a five-year lease on the property in August 2012, which decreases the
maintenance costs of the property and thereby contributes to profitability.
Incap will continue the measures aiming to sell the property. At the end of
2012, it will be reviewed whether the property can still be recognised as
available for sale in the financial statements and how it will be valued.
The deferred tax assets recognised in the consolidated balance sheet (EUR 4.0
million) are based on the Board of Directors' assessment of future earnings
development at Incap Corporation and the Indian subsidiary. On 30 September
2012, confirmed tax losses for which no deferred tax asset was recognised
amounted to EUR 8.1 million. Because Incap's performance in the previous years
was significantly different than projected, future utilisation of deferred tax
assets is uncertain.
Outlook for 2012
Incap's estimates for future business development are based on its customers'
forecasts and the company's own assessments. Demand in the energy efficiency
industry remained at a good level in Europe and India. Revenue from well-being
technology products will fall short of the previous year due to the
discontinuation of certain products formerly manufactured in Helsinki and
Kuressaare.
The closure of the Helsinki factory is the final stage in the company's
strategic restructuring of production, which has formed a basis for profitable
growth. Transferring the factory's production to other units and making
operations more efficient will improve the company's profitability starting in
the third quarter.
Incap reiterates its previous guidance published on 14 September. The company
estimates that the Group's revenue in 2012 will be lower than the EUR 68.9
million achieved in 2011. Incap further estimates that the operating profit
(EBIT) for the latter half of the year will be positive and full-year operating
profit will be clearly better than in 2011, at which time it amounted to EUR
-1.6 million.
Publication of the financial statements for 2012 and interim report for the
fourth quarter
Incap Group's financial statements for 2012 will be published on Tuesday, 26
February 2013.
INCAP CORPORATION
Board of Directors
Additional information:
Sami Mykkänen, President and CEO, tel. +358 40 559 9047
Kirsti Parvi, CFO, tel. +358 50 517 4569
Hannele Pöllä, Director, Communications and Investor Relations, tel.
+358 40 504 8296
DISTRIBUTION
NASDAQ OMX Helsinki Ltd
Principal media
www.incap.fi
PRESS CONFERENCE
Incap will arrange a conference for the press and financial analysts on 31
October 2012 at 10:00 a.m. at the World Trade Center, Helsinki, in Meeting Room
4 on the 2nd floor at Aleksanterinkatu 17, FI-00100 Helsinki.
ANNEXES
1 Consolidated Income Statement
2 Consolidated Balance Sheet
3 Consolidated Cash Flow Statement
4 Consolidated Statement of Changes in Equity
5 Group Key Figures and Contingent Liabilities
6 Quarterly Key Figures
7 Calculation of Key Figures
INCAP IN BRIEF
Incap Corporation is an internationally operating contract manufacturer whose
comprehensive services cover the entire life-cycle of electromechanical products
from design and manufacture to maintenance services. Incap's customers include
leading equipment suppliers in energy-efficiency and well-being technologies,
for which the company produces competitiveness as a strategic partner. Incap has
operations in Finland, Estonia, India and China. The Group's revenue in 2011amounted to EUR 68.9 million, and the company currently employs approximately
670 people. Incap's share is listed on the NASDAQ OMX Helsinki. Additional
information: www.incap.fi.
Annex 1
CONSOLIDATED INCOME STATEMENT (IFRS)
(EUR
thousand, 1-3/ 4-6/ 7-9/ 1-3/ 4-6/ 7-9/ 1-9/ 1-9/ CHG 1-12/
unaudited) 2012 2012 2012 2011 2011 2011 2012 2011 % 2011
-------------------------------------------------------------------------------
RE-
VENUE 15 564 18 378 15 701 16 005 17 694 18 286 49 643 51 985 -5 68 890
Work
per-
formed
by the
enter-
prise
and
capita-
lised 0 0 0 0 0 0 0 0 0
Change
in
invent-
tories
of
finished
goods
and
work in
pro-
gress 176 -327 -169 34 4 -42 -320 -5 6 982 -363
Other
opera-
ting
income 85 134 136 38 40 18 355 96 270 145
Raw
ma-
terials
and
con-
sumables
used 10 801 12 568 10 978 11 270 12 812 13 034 34 347 37 116 -7 48 631
Personnel
expenses 3 011 3 119 2 419 2 916 3 075 2 861 8 548 8 853 -3 12 016
De-
preciation
and
amor-
tisation 415 435 378 552 542 494 1 229 1 588 -23 2 047
Other
opera-
ting
ex-
penses 1 944 2 051 1 612 1 762 1 931 1 837 5 606 5 529 1 7 597
-------------------------------------------------------------------------------
OPERA-
TING
PROFIT/
LOSS -345 13 280 -423 -623 35 -52 -1 010 -95 -1 619
Financing
income
and
expenses -366 339 -156 -528 -559 -611 -182 -1 699 -89 -2 378
-------------------------------------------------------------------------------
PROFIT/
LOSS
BEFORE
TAX -711 352 124 -951 -1 182 -576 -235 -2 709 -91 -3 997
Income
tax
expense 0 0 -79 0 0 0 -79 0 0
-------------------------------------------------------------------------------
PROFIT/
LOSS
FOR
THE
PERIOD -711 352 44 -951 -1 182 -576 -314 -2 709 -88 -3 997
Earnings
per
share -0,04 0,02 0,00 -0,05 -0,06 -0,03 -0,02 -0,15 -89 -0,21
Options
have no
dilutive
effect
in
account-
ting
periods
2011 and
2012
OTHER 1-3/ 4-6/ 7-9/ 1-3/ 4-6/ 7-9/ 1-9/ 1-9/ 1-12/
COMPREHENSIVE 2012 2012 2012 2011 2011 2011 2012 2011 Change % 2011
INCOME
--------------------------------------------------------------------------------
PROFIT/LOSS FOR -711 352 44 -951 -1,182 -576 -314 -2,709 -88 -3,997
THE PERIOD
OTHER
COMPREHENSIVE
INCOME:
Translation
differences from -2 -50 63 -185 -57 -40 11 -282 -104 -316
foreign units
--------------------------------------------------------------------------------
Other
comprehensive -2 -50 63 -185 -57 -40 11 -282 -104 -316
income, net
TOTAL
COMPREHENSIVE -712 302 107 -1,136 -1,239 -616 -303 -2,991 -90 -4,313
INCOME
Attributable to:
Shareholders of -712 302 107 -1,136 -1,239 -616 -303 -2,991 -90 -4,313
the parent company
Non-controlling 0 0 0 0 0 0 0 0 0
interest
Annex 2
CONSOLIDATED BALANCE SHEET (IFRS)
(EUR thousand, unaudited) 30.9.2012 30.9.2011 Change % 31.12.2011
--------------------------------------------------------------------------------
ASSETS
NON-CURRENT ASSETS
Property, plant and equipment 2,863 4,457 -36 4,007
Goodwill 969 981 -1 964
Other intangible assets 194 420 -54 341
Other financial assets 311 314 -1 314
Deferred tax assets 4,014 4,112 -2 4,085
--------------------------------------------------------------------------------
TOTAL NON-CURRENT ASSETS 8,351 10,284 -19 9,710
CURRENT ASSETS
Inventories 10,339 12,440 -17 11,423
Trade and other receivables 14,295 16,574 -14 15,834
Cash and cash equivalents 231 310 -26 369
--------------------------------------------------------------------------------
TOTAL CURRENT ASSETS 24,864 29,325 -15 27,625
Non-current assets held for sale 1,936 1,936 0
TOTAL ASSETS 35,151 41,544 -15 39,271
EQUITY ATTRIBUTABLE TO EQUITY HOLDERS OF
THE PARENT
COMPANY
Share capital 20,487 20,487 0 20,487
Share premium account 44 44 0 44
Reserve for invested unrestricted equity 4,809 4,084 18 4,084
Exchange differences -788 -731 8 -799
Retained earnings -22,825 -21,252 7 -22,506
--------------------------------------------------------------------------------
TOTAL EQUITY 1,728 2,633 -34 1,311
NON-CURRENT LIABILITIES
Deferred tax liabilities 0 0 0 0
Interest-bearing loans and borrowings 1,915 490 291 259
--------------------------------------------------------------------------------
NON-CURRENT LIABILITIES 1,915 490 291 259
CURRENT LIABILITIES
Trade and other payables 12,369 13,680 -10 13,109
Current interest-bearing loans and 19,097 24,399 -22 24,336
borrowings
--------------------------------------------------------------------------------
CURRENT LIABILITIES 31,466 38,079 -17 37,445
Liabilities relating to non-current 43 342 -87 256
assets held for sale
TOTAL EQUITY AND LIABILITIES 35,151 41,544 -15 39,271
Annex 3
CONSOLIDATED CASH FLOW STATEMENT
(EUR thousands, unaudited) 1-9/2012 1-9/2011 1-12/2011
--------------------------------------------------------------------------------
Cash flow from operating activities
Operating profit/loss -52 -1,010 -1,619
Adjustments to operating profit 867 1,119 2,157
Change in working capital 2,354 -2,442 -1,920
Interest and other payments made -1,580 -1,277 -1,793
Interest received 19 27 38
--------------------------------------------------------------------------------
Cash flow from operating activities 1,608 -3,583 -3,137
Cash flow from investing activities
Capital expenditure on tangible and intangible -69 -241 -280
assets
Proceeds from sale of tangible and intangible assets 134 132 148
Other investments -61 0 -80
Loans granted -4 -2 -6
Sold shares of subsidiary 0 0 0
--------------------------------------------------------------------------------
Repayments of loan assets 3 45 0
Cash flow from investing activities 3 -66 -218
Cash flow from financing activities
Proceeds from share issue 725 0 0
Drawdown of loans 1,309 4,692 4,946
Repayments of borrowings -3,158 -717 -1,118
Repayments of obligations under finance leases -566 -661 -843
--------------------------------------------------------------------------------
Cash flow from financing activities -1,690 3,314 2,985
Change in cash and cash equivalents -79 -335 -371
Cash and cash equivalents at beginning of period 369 476 476
Effect of changes in exchange rates -28 193 288
Changes in fair value (cash and cash equivalents) -31 -24 -24
Cash and cash equivalents at end of period 231 310 369
Annex 4
CONSOLIDATED STATEMENT OF
CHANGES IN EQUITY
(EUR thousand,
unaudited)
Share Reserve for
Share premium invested Exchange Retained Total
capital account unrestricted differences earnings
equity
--------------------------------------------------------------------------------
Equity at 1 20,487 44 4,084 -483 -18,510 5,622
January 2011
Issue premium 0 0 0 0 0 0
Transaction
costs for 0 0 0 0 0 0
equity
Change in
exchange 0 0 0 -248 -34 -282
differences
Options and
share-based 0 0 0 0 2 2
compensation
Other changes 0 0 0 0 0 0
--------------------------------------------------------------------------------
Net income and
losses
recognised 0 0 0 -248 -32 -280
directly in
equity
Net profit/loss 0 0 0 0 -2,709 -2,709
--------------------------------------------------------------------------------
Total income 0 0 0 -248 -2,741 -2,989
and losses
Equity at 30 20,487 44 4,084 -731 -21,252 2,633
September 2011
Equity at 1 20,487 44 4,084 -799 -22,506 1,311
January 2012
Share issue 0 0 759 0 0 759
Transaction
costs for 0 0 -34 0 0 -34
equity
Change in
exchange 0 0 0 11 0 11
differences
Options and
share-based 0 0 0 0 -5 -5
compensation
--------------------------------------------------------------------------------
Other changes 0 0 0 0 0 0
Net income and
losses
recognised 0 0 725 11 -5 731
directly in
equity
Net profit/loss 0 0 0 0 -314 -314
--------------------------------------------------------------------------------
Total income 0 0 725 11 -319 417
and losses
Equity at 30 20,487 44 4,809 -788 -22,825 1,728
September 2012
Annex 5
GROUP KEY FIGURES AND CONTINGENT LIABILITIES
(IFRS) 1-9/2012 1-9/2011 1-12/2011
--------------------------------------------------------------------------------
Revenue, EUR million 49.6 52.0 68.9
Operating profit, EUR million -0.1 -1.0 -1.6
% of revenue -0.1 -1.9 -2.4
Profit before taxes, EUR million -0.2 -2.7 -4.0
% of revenue -0.5 -5.2 -5.8
Return on investment (ROI), % 6.8 -4.2 -5.1
Return on equity (ROE), % -27.6 -87.5 -115.3
Equity ratio, % 4.9 6.3 3.3
Gearing, % 1205.2 946.5 1,867.7
Net debt, EUR million 18.9 22.0 21.8
Net interest-bearing debt, EUR million 20.8 24.9 24.5
Quick ratio 0.5 0.4 0.4
Current ratio 0.8 0.8 0.7
Average number of shares during the report 19,804,494 18,680,880 18,680,880
period, adjusted for share issues
Earnings per share (EPS), EUR -0.02 -0.15 -0.21
Equity per share, EUR 0.08 0.14 0.07
Dividend per share, EUR 0 0 0
Dividend/profit, % 0 0 0
Effective dividend yield, % 0 0 0
Price/earnings ratio (P/E) -17.0 -3.2 -2.0
Share price development
Lowest price during the period, EUR 0.27 0.40 0.37
Highest price during the period, EUR 0.65 0.64 0.64
Average price during the period, EUR 0.39 0.54 0.52
Closing price, EUR 0.27 0.47 0.42
Market capitalisation, EUR 5.6 8.8 7.8
Share turnover, number of shares 1,499,294 606,719 746,382
Share turnover, % 7.2 3.2 4.0
Investments, EUR million 0.1 0.2 0.3
% of revenue 0.1 0.5 0.4
Average number of employees 713 747 749
CONTINGENT LIABILITIES, EUR millions
FOR OWN LIABILITIES
Mortgages 14.4 12.4¹ 12.3¹
Off-balance sheet liabilities 1.9 1.8 1.8
Nominal value of currency options, EUR thousand 0 0 0.0
Fair values of currency options, EUR thousand 0 0 0.0
¹The bank has confirmed in September 2012 that
EUR 1 million of the company's mortgages was
released on 6 May 2011. The incorrect amount of
mortgages announced in previously published
interim reports and the financial statements
for 2011 has been corrected in this table.
Annex 6
QUARTERLY KEY FIGURES (IFRS)
7-9/ 4-6/ 1-3/ 10-12/ 7-9/ 4-6/ 1-3/
2012 2012 2012 2011 2011 2011 2011
-------------------------------------------------------------------
Re-
venue,
EUR
million 15.7 18.4 15.6 16.9 18.3 17.7 16.0
Opera-
ting
profit,
EUR
million 0.3 0.0 -0.3 -0.6 0.0 -0.6 -0.4
%
of
re-
venue 1.8 0.1 -2.2 -3.6 0.2 -3.5 -2.6
Profit
before
taxes,
EUR
million 0.1 0.4 -0.7 -1.3 -0.6 -1.2 -1.0
% of
re-
venue 0.8 1.9 -4.6 -7.6 -3.2 -6.7 -5.9
Return
on in-
vestment
(ROI), % 3.3 17.8 -1.5 -7.6 1.1 -9.4 -4.3
Return
on
equity
(ROE), % 11.7 95 -297.7 -148.7 -55.8 -106.5 -75.2
Equity
ratio, % 4.9 4.3 1.6 3.3 6.3 7.6 11.0
Gearing, % 1,205.2 1,372.9 4,103.2 1,867.7 946.5 739.3 486.6
Net debt,
EUR
million 18.9 20.3 23.2 21.8 22.0 22.9 21.7
Net
interest-
bearing
debt,
EUR
million 20.8 22.7 24.6 24.5 24.9 24.1 21.9
Average
number
of
share
issue-
adjusted
shares
during
the
financial 19,804, 19,276, 18,680, 18,680, 18,680, 18,680, 18,680,
period 494 512 880 880 880 880 880
Earnings
per
share
(EPS),
EUR -0.00 0.02 -0.04 -0.07 -0.03 -0.06 -0.05
Equity
per
share,
EUR 0.08 0.08 0.03 0.07 0.14 0.17 0.2
In-
vestments,
EUR
million 0.0 0.1 0.0 0.0 0.1 0.1 0.1
%
of
revenue -0.1 0.3 0.2 0.0 0.7 0.7 0.3
Average
number
of
em-
ployees 699 710 728 753 770 745 727
Annex 7
CALCULATION OF KEY FIGURES
100 x (profit/loss for the period +
Return on investment, % financing costs)
----------------------------------------
equity + interest-bearing financing
loans
Return on equity (ROE), %
100 x profit/loss for the period
----------------------------------------
average equity during the accounting
period
Equity ratio, % 100 x equity
----------------------------------------
balance sheet total - advances received
100 x interest-bearing net financing
Gearing, % loans
----------------------------------------
equity
Net liabilities liabilities - current assets
Quick ratio current assets
----------------------------------------
short-term liabilities - short-term
advances received
Current ratio current assets + inventories
----------------------------------------
short-term liabilities
Earnings per share net profit/loss for the period
----------------------------------------
average number of share-issue adjusted
shares during the period
Equity per share equity
----------------------------------------
number of share-issue adjusted shares
at the end of the period
VAT-exclusive working capital
acquisitions, without deduction of
Capital expenditure investment subsidies
average of personnel numbers calculated
Average number of employees at the end of each month
closing price for the period x number
Market capitalisation of shares available for public trading
[HUG#1653747]
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