2009-04-30 07:00:00 CEST
2009-04-30 07:01:33 CEST
REGULATED INFORMATION
Elektrobit Oyj - Interim report (Q1 and Q3)
EB, ELEKTROBIT CORPORATION, INTERIM REPORT, JANUARY TO MARCH 2009, EB IMPROVED OPERATING PROFIT
STOCK EXCHANGE RELEASE
Free for publication on April 30, 2009 at 8.00 am. (CEST+1)
EB, ELEKTROBIT CORPORATION, INTERIM REPORT, JANUARY TO MARCH 2009
EB IMPROVED OPERATING PROFIT
SUMMARY 1Q 2009
- Net sales amounted to EUR 42.8 million (EUR 47.3 million, 1Q 2008),
representing 9.5 per cent decrease year-on-year.
- Operating profit from business operations amounted to EUR 0.9
million and the non-recurring costs totaled to EUR -0.9 million,
resulting in a total operating profit of EUR 0.0 million (EUR -8.0
million, 1Q 2008).
- Operating cash flow amounted to EUR -2.7 million (EUR -7.4 million,
1Q 2008). The net cash flow amounted to EUR -5.8 million (EUR 13.8
million, 1Q 2008).
- Cash and other liquid assets totaled to EUR 62.8 million (85.7
million, 1Q 2008)
- Equity ratio remained at a high level of 68.2% (69.5%, 1Q 2008).
- Earnings per share were EUR -0.01 (EUR -0.06, 1Q 2008).
Despite of the challenging market environment and consequent
reduction of net sales, EB was able to improve its profitability and
achieve a positive operating profit from business operations. The
performance improvement was due to sharpening of the business
portfolio, improvement of the cost structure and actions to improve
project execution. EB's profit improvement and cost structure
adjustment program launched in fourth quarter 2008 targeting in total
for EUR 40 million annual cost savings in comparison to the cost
level of the first half of 2008 is proceeding as planned.
As guided earlier EB expects that the turnover of the first half of
2009 will be on the same level or lower than in the second half of
2008 (EUR 84.0 million). The announced annual EUR 40 million cost
saving actions are expected to continue to gain effect during the
first half of 2009 and consequently the profitability of the first
half of 2009 is expected to improve significantly compared to the
operative result of the second half of 2008 (EUR -14.1 million). Due
to the challenging market environment and consequent uncertainty of
sales revenue development, operating profit in 2Q 2009 is not
expected to improve compared to 1Q 2009 (EUR 0.9 million) despite of
improving cost structure.
EB'S CEO PERTTI KORHONEN:"Despite of the downturn of the market and decrease of the net
sales, we have been able to achieve positive operating profit as our
profitability improvement program has been producing results.
Improvement of profitability continues to be our first priority. The
visibility to the market continues to be short, bringing
uncertainties to the net sales development."
FINANCIAL PERFORMANCE DURING JANUARY-MARCH 2009
(Comparisons are given to January-March 2008, unless otherwise
indicated)
EB's net sales during January - March 2009 decreased 9.5 per cent to
EUR 42.8 million (EUR 47.3 million). Operating profit, including
mostly restructuring related non-recurring items of EUR -0.9 million,
amounted to EUR 0.0 million (EUR -8.0 million). The result from
continuing business operations was EUR 0.9 million positive.
The Automotive Business Segment's net sales during January - March
2009 amounted to EUR 16.4 million (EUR 15.5 million) representing a
growth of 5.9 per cent. The operating loss reduced to EUR -0.7
million (EUR -1.6 million).
The Wireless Business Segment's net sales during January - March 2009
amounted to EUR 26.3 million (EUR 31.7 million including
extraordinary low-margin through-licensing revenues of approximately
EUR 3 million), representing a decline of 17.0 per cent compared to
January - March 2008. The operating profit, including non-recurring
costs of EUR 0.7 million, was EUR 0.5 million (EUR -6.5 million). The
significant improvement of operating result with lower turnover
year-on-year was mainly due to the earlier announced profitability
improvement program.
The total R&D investments during the reporting period were EUR 3.4
million (EUR 11.6 million), equaling 8.0 per cent of the net sales
(24.6 per cent in 2008). The reduction is mostly due to the change of
the business model (and consequent exit from developing own products)
in Mobile WiMAX in October 2008 and exit from RFID technology
business in February 2009.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME 1-3 2009 1-3 2008
(MEUR)
3 months 3 months
NET SALES 42.8 47.3
OPERATING PROFIT (LOSS) 0.0 -8.0
Financial income and expenses -0.9 0.4
RESULT BEFORE TAX -0.9 -7.7
RESULT FOR THE PERIOD FROM CONTINUING OPERATIONS -1.1 -7.7
Result after tax for the year from discontinued 0.0
operations 0.0
RESULT FOR THE PERIOD -1.1 -7.7
TOTAL COMPREHENSIVE INCOME FOR THE PERIOD -0.8 -8.1
Result for the period attributable to
Equity holders of the parent -1.1 -7.7
Total comprehensive income for the period
attributable to:
Equity holders of the parent -0.8 -8.1
Earnings per share EUR continuing operations -0.01 -0.06
Earnings per share EUR discontinued operations 0.00 0.00
Earnings per share EUR continuing and discontinued -0.01
operations -0.06
- Cash flow from Business Operations amounted to EUR -2.7 million
(EUR -7.4 million).
- Equity ratio was 68.2% (69.5%).
- Net gearing was -36.9% (-35.0%).
QUARTERLY FIGURES
The distribution of the Group's overall net sales and profit, MEUR:
+-------------------------------------------------------------------+
| | 1Q 09 | 4Q 08 | 3Q 08 | 2Q 08 | 1Q 08 |
|---------------------------+-------+-------+-------+-------+-------|
| Net sales | 42.8 | 49.5 | 34.5 | 41.0 | 47.3 |
|---------------------------+-------+-------+-------+-------+-------|
| Operating profit (loss) | 0.0 | -8.5 | -12.9 | -13.3 | -8.0 |
|---------------------------+-------+-------+-------+-------+-------|
| Operating profit (loss) | 0.9 | -2.8 | -11.3 | -9.9 | -5.1 |
| without non-recurring | | | | | |
| costs | | | | | |
|---------------------------+-------+-------+-------+-------+-------|
| Result before taxes | -0.9 | -11.8 | -14.4 | -13.6 | -7.7 |
|---------------------------+-------+-------+-------+-------+-------|
| Result for the period | -1.1 | -14.0 | -14.6 | -13.5 | -7.7 |
+-------------------------------------------------------------------+
The distribution of the net sales by Business Segment, MEUR:
+-----------------------------------------------------------+
| | 1Q 09 | 4Q 08 | 3Q 08 | 2Q 08 | 1Q 08 |
|-------------------+-------+-------+-------+-------+-------|
| Automotive | 16.4 | 18.7 | 15.9 | 13.2 | 15.5 |
|-------------------+-------+-------+-------+-------+-------|
| Wireless | 26.3 | 30.7 | 18.5 | 27.7 | 31.7 |
|-------------------+-------+-------+-------+-------+-------|
| Corporation total | 42.8 | 49.5 | 34.5 | 41.0 | 47.3 |
+-----------------------------------------------------------+
The distribution of the net sales by market area, MEUR and %:
+--------------------------------------------------+
| | 1Q 09 | 4Q 08 | 3Q 08 | 2Q 08 | 1Q 08 |
|----------+-------+-------+-------+-------+-------|
| Asia | 4.4 | 3.1 | 0.9 | 2.1 | 2.0 |
| | 10.3% | 6.2% | 2.6% | 5.2% | 4.3% |
|----------+-------+-------+-------+-------+-------|
| Americas | 11.9 | 10.9 | 7.1 | 12.7 | 18.5 |
| | 27.7% | 22.0% | 20.7% | 31.0% | 39.2% |
|----------+-------+-------+-------+-------+-------|
| Europe | 26.6 | 35.5 | 26.4 | 26.2 | 26.8 |
| | 62.1% | 71.8% | 76.7% | 63.8% | 56.5% |
+--------------------------------------------------+
Net sales (external) and operating profit development by Business
Segments and Other businesses, MEUR:
+-----------------------------------------------------------------+
| | 1Q 09 | 4Q 08 | 3Q 08 | 2Q 08 | 1Q 08 |
|-------------------------+-------+-------+-------+-------+-------|
| Automotive | | | | | |
| Net sales | 16.4 | 18.7 | 15.9 | 13.2 | 15.5 |
| Operating profit (loss) | -0.7 | -2.3 | -4.1 | -4.1 | -1.6 |
|-------------------------+-------+-------+-------+-------+-------|
| Wireless | | | | | |
| Net sales | 26.3 | 30.7 | 18.5 | 27.7 | 31.7 |
| Operating profit (loss) | 0.5 | -4.9 | -8.1 | -9.1 | -6.5 |
|-------------------------+-------+-------+-------+-------+-------|
| Other businesses | | | | | |
| Net sales | 0.1 | 0.1 | 0.1 | 0.1 | 0.1 |
| Operating profit (loss) | 0.2 | -1.3 | -0.7 | -0.2 | 0.1 |
|-------------------------+-------+-------+-------+-------+-------|
| Total | | | | | |
| Net sales | 42.8 | 49.5 | 34.5 | 41.0 | 47.3 |
| Operating profit (loss) | 0.0 | -8.5 | -12.9 | -13.3 | -8.0 |
+-----------------------------------------------------------------+
BUSINESS SEGMENTS' MAIN EVENTS DURING 1Q 2009
EB's reporting as from January 1, 2008 has been based on the
Automotive and Wireless Business Segments.
AUTOMOTIVE
The Automotive Business Segment consists of in-car software products,
navigation software for after market devices (PND, personal
navigation devices) and R&D services for the automotive industry with
leading car manufacturers, car electronics suppliers (Tier 1) and
automotive chipset suppliers as customers. By combining its software
products and engineering services EB is creating unique, customized
solutions for its automotive customers.
During the first quarter of 2009, the net sales of the Automotive
Business Segment amounted to EUR 16.4 million (EUR 15.5 million, 1Q
2008), which represents a year-on-year growth of 5.9 per cent.
Regardless of the highly demanding market environment, Automotive
Business Segment has managed to improve its turnover level and
decrease its operating loss to EUR -0.7 million during 1Q 2009 (EUR
-1.6 million, 1Q 2008).
Automotive Business Segment has continued the execution of its
announced strategy and has made market progress globally with its
offering and has now revenue generating customers in Europe, USA,
Japan and China. Financial performance improvement is mainly due to
the prudent focus on all costs as well as improved project execution.
EB has continued to invest to the development of world leading
automotive software products.
In February EB announced the availability of its navigation solution,
EB street director, for MIDs (Mobile Internet Devices) based on the
Moblin operating system and the Intel® Atom(TM) processor. EB has
been working with Intel to optimize EB street director for its
customers to take advantage of the growing MID market as well as the
automotive in-dash market.
In March EB announced being among the first companies to be qualified
as a training partner for Microsoft Auto software platform.
WIRELESS
The Wireless Business Segment comprises the following businesses:
- Wireless Solutions provides customized solutions and R&D services
for wireless industry and other industries utilizing wireless
technologies.
- Wireless Communications Tools provides test tools for measuring,
modeling and emulating radio channel environments.
- Wireless Sensor Solutions (RFID reader systems) until February 1,
2009.
During the first quarter of 2009, the net sales of the Wireless
Business Segment amounted to EUR 26.3 million (EUR 31.7 million, 1Q
2008 included extraordinary low-margin through-licensing revenues of
approximately EUR 3 million), representing a decrease of 17.0 per
cent. The operating profit, including non-recurring costs of EUR 0.7
million, was EUR 0.5 million (EUR -6.5 million). The significant
improvement of operating result with lower turnover year-on-year was
mainly due to the announced profitability improvement program.
EB continued to develop its offering towards provision of customized
solutions by integrating own and 3rd party technologies in addition
to provision of R&D services. R&D service work for the mobile
communications customers continued with good volume during the first
quarter though the traditional R&D service market became more
challenging and many wireless communications customers are under
heavy cost pressure. The demand for satellite-terrestrial network
device solutions continued to be strong during the quarter.
EB strengthened its position as an innovative solution provider to
its customers in wireless and other industries utilizing wireless
technologies by launching satellite-terrestrial network PDA and
connectivity module reference designs and Mobile WiMAX basestation
framework concept. EB also launched a ruggedized VoIP solution for
demanding environments.
During the first quarter EB announced among six other European
companies to develop common software radio (SDR) architecture for
European defense communications' needs as a part of the ESSOR
(European Secure Software Defined Radio) program.
As part of the cost structure improvement actions, EB decided to
close its site in Turku and focus the Wireless Segment's R&D
activities in Finland on the other existing sites in Oulu, Kajaani,
Tampere and Espoo.
The sales of wireless communications emulation and design tools were
slightly recovered sequentially compared to the second half of 2008
due to the growing demand for tools needed in development of LTE
systems.
EB exited from RFID technology business in the beginning of February
2009 by selling 7iD Technologies GmbH to the acting management of the
said company in Austria. The transaction did not have a significant
impact to EB's balance sheet or result. Due to this transaction
Wireless Sensor Solution business ceased to exist.
MARKET OUTLOOK
As a consequence of the poor macro environment both automotive and
wireless communication markets are suffering and market growth is
unlikely before the global economical environment starts to improve.
The share of electronics and software in cars has grown significantly
during the past years and it is expected that the trend of increased
use of software in automotive continues to prevail in the market. The
majority of the innovation and differentiation in the automotive
industry is brought about by software and electronics. In order to
enable faster innovation and to improve quality, development
efficiency and to reduce complexity related to software, the use of
standard software solutions is expected to increase. The estimated
automotive software general market growth rate of some 15 % (Frost &
Sullivan) will most likely be negatively affected by the current
downturn of the automotive industry in the near-term. However, the
underlying growth of the automotive software market is expected to
continue past the crisis and the cost pressures of the automotive
industry are expected to accelerate the need of productized,
efficient software solutions EB is offering. EB's net sales
cumulating from the automotive industry is currently driven by the
development of new cars and platforms and is not directly dependent
on production volumes of the car industry.
The global mobile infrastructure market is decreasing and the
consolidation of the industry is expected to continue. LTE standard
is gaining strength while the momentum of Mobile WiMAX standard has
been decreasing. Going forward, EB's business driven by LTE is
increasing while EB's future sales revenues are not materially
dependent on Mobile WiMAX technology. The global mobile phone market
is leveling off and is expected to decrease in volume in short-term.
The value share is expected to move towards higher-end due to the
increased demand for new features and services. New open software
architectures and platforms are creating opportunities for companies
such as EB with strong integration capabilities.
The mobile satellite communication service industry is undergoing a
paradigm shift to the next generation solutions with new operators
being formed and traditional operators upgrading their solutions and
offerings. Mastering of multi-radio technologies and end-to-end
system architectures covering both terminal and network technologies,
has gained importance in the complex wireless technology industry.
Therefore the demand for EB's satellite-terrestrial device solutions
is expected to continue and EB expects to win new customers in this
domain.
The mobile communication R&D services market continues to be
challenging and the continuing price pressure drive increasing
off-shoring in the industry. However, attractive niches continue to
exist (OVUM). Because of the economical slowdown, companies will be
reviewing their R&D costs and project portfolio resulting to
reduction of the overall R&D expenditures and activities during the
next couple of years, resulting to less demand for external R&D
services. However, OEMs need to reduce their fixed costs and increase
flexibility. This can create new opportunities for partnering for
companies such as EB.
The wireless communications tools market has been weak by following
the global trends in the current economic downturn. However there is
a moderately growing need for advanced development tools for 3GPP LTE
development projects and that is expected to be the main driver for
the demand in the medium and long term. EB is providing world leading
channel emulation tools for the development of MIMO based 3GPP LTE
and other advanced radio technologies.
RESEARCH AND DEVELOPMENT DURING 1Q 2009
EB continued to invest in R&D in the automotive software products and
tools and radio channel emulation product portfolio.
The total R&D investments during the first quarter of 2009 were EUR
3.4 million (EUR 11.6 million, 1Q 2008), equaling 8.0 per cent of the
net sales (24.6 % in 2008). The reduction is mostly due to the change
of the business model (and consequent exit from developing own
products) in Mobile WiMAX in October 2008 and exit from RFID
technology business in February 2009.
EVENTS AFTER THE REPORTING PERIOD
EB announced in April that it has decided to close its site in Turku
in October 2009 and focus the Wireless Segment's R&D activities in
Finland to the other existing sites in Oulu, Kajaani, Tampere and
Espoo. The personnel negotiations were concluded on April 7, 2009 and
maximum number of dismissal is 49 based on the restructuring,
financial and production related reasons.
ACTIONS TO IMPROVE PROFITABILITY
EB's profit improvement and cost structure adjustment program is
proceeding as planned. The program was launched in fourth quarter
2008 and targeting in total for EUR 40 million annual cost savings in
comparison to the cost level of the first half of 2008. The cost
saving measures totaling to EUR 30 million have gained their full
impact from the beginning of 2009. The additional measures targeting
to EUR 10 million savings have been mostly identified and are
currently being implemented.
As part of the planned cost structure adjustments, EB has concluded
the actions to reduce personnel by 170 employees globally.
OUTLOOK FOR THE FIRST HALF OF 2009
The more general market outlook by the businesses is presented under
the Market Outlook section.
As guided earlier EB expects that the turnover of the first half of
2009 will be on the same level or lower than in the second half of
2008 (EUR 84.0 million). The announced annual EUR 40 million cost
saving actions are expected to continue to gain effect during the
first half of 2009 and consequently the profitability of the first
half of 2009 is expected to improve significantly compared to the
operative result of the second half of 2008 (EUR -14.1 million). Due
to the challenging market environment and consequent uncertainty of
sales revenue development, operating profit in 2Q 2009 is not
expected to improve compared to 1Q 2009 (EUR 0.9 million) despite of
improving cost structure.
RISKS AND UNCERTAINTIES
EB has identified a number of business, market and finance related
factors that can affect the level of sales and profits. Those of the
greatest significance on a short term are those affecting the
utilization and chargeability levels and average hourly prices. On
the ongoing financial period the global economic slowdown may affect
the demand for the EB's services, solutions and products and provide
pressure on e.g. volumes and pricing. It may also increase the risk
for credit losses. As the EB's customer base consists mainly of
companies operating in the field automotive and telecommunications,
the company is exposed to market changes in these industries. EB
believes that the expanding of its customer base reduces dependence
on individual companies and that the company is thereby mainly
affected by the general business climate in automotive and
telecommunication industries. However, some parts of EB's business
are more sensitive to customer dependency than others. The more
general market outlook by the businesses is presented under the
Market Outlook section.
EB's operative business risks are mainly related to following items:
uncertainties and short visibility on customers' product program
decisions, their make or buy decisions and, on the other hand, their
decisions to continue, downsize or terminate current product
programs, ramping up and down project resources, timing and on the
other hand successful utilization of the most important technologies
and components, competitive situation and potential delays in the
markets, timely closing of customer and supplier contracts with
reasonable commercial terms, delays in R&D projects, activations
based on customer contracts, obsolescence of inventories and
technology risks in product development causing higher than planned
R&D costs. In addition there are typical industry warranty and
liability risks involved in selling EB's services, solutions and
products. Revenues expected to come from new products for existing
and new customers include normal timing risks.
More information on the risks and uncertainties affecting EB can be
found on the company website at www.elektrobit.com
STATEMENT OF FINANCIAL POSITION AND FINANCING
The figures presented in the statement of financial position of March
31, 2009, have been compared with the statement of financial position
of December 31, 2008 (EUR 1,000).
3/2009 12/2008
Non-current assets 44,372 46,724
Current assets 128,527 133,797
Total assets 172,899 180,520
Share capital 12,941 12,941
Other equity 101,894 102,181
Total shareholders' equity 114,835 115,123
Non-current liabilities 17,661 19,690
Current liabilities 40,402 45,708
Total shareholders' equity and liabilities 172,899 180,520
Net cash flow from operations during the period under review:
+ net profit +/- adjustment of accrual basis items EUR +2.2 million
- increase in net working capital EUR -4.0 million
+ interest, taxes and dividends EUR -0.9 million
= cash generated from operations EUR -2.7 million
- net cash used in investment activities EUR -1.4 million
- net cash used in financing EUR -1.7 million
= net change in cash and cash equivalents EUR -5.8 million
The amount of accounts and other receivables, booked in current
receivables, was EUR 62.9 million (EUR 61.9 million on December 31,
2008). Accounts and other payables, booked in interest-free current
liabilities, were EUR 34.2 million (EUR 38.7 million on December 31,
2008).
The amount of non-depreciated consolidation goodwill at the end of
the period under review was EUR 18.3 million (EUR 18.3 million on
December 31, 2008).
The amount of gross investments in the period under review was EUR
0.8 million, consisting of replacement investments. Net investments
for the reporting period totaled to EUR 0.6 million. The total amount
of depreciation during the period under review was EUR 2.7 million,
including EUR 0.6 million of depreciation owing to business
acquisitions.
The amount of interest-bearing debt at the end of the reporting
period was EUR 20.4 million. The distribution of net financing
expenses on the income statement was as follows:
interest, dividend and other financial income EUR 0.3 million
interest expenses and other financial expenses EUR -0.3 million
foreign exchange gains and losses EUR -1.0 million
EB's equity ratio at the end of the period was 68.2 per cent (64.9
per cent at the end of 2008).
The figures from the period under review includes the statutory
reserves EUR 3.0 million.
EB follows a currency strategy, the objective of which is to ensure
the margins of business operations in changing market circumstances
by minimizing the influence of exchange rates. In accordance with the
principles of the currency strategy, the agreed customer commitments
net cash flow of the currency in question is hedged. The net cash
flow is determined on the basis of sales receivables, payables, the
order book and the budgeted net currency cash flow. The hedged
foreign currency exposure at the end of the review period was
equivalent to EUR 17.1 million.
PERSONNEL
EB employed an average of 1663 people between January and March 2009.
At the end of March, EB had 1628 employees (1735 at the end of 2008).
A significant part of EB's personnel are product development
engineers.
THE AUTHORIZATION OF THE BOARD OF DIRECTORS TO DECIDE ON THE
REPURCHASE OF OWN SHARES
The General Meeting held on March 19, 2009, decided to authorize the
Board of Directors to decide on the repurchase of the company's own
shares as follows.
The amount of own shares to be repurchased shall not exceed
12,500,000 shares, which corresponds to approximately 9.66 per cent
of all of the shares in the company. Only the unrestricted equity of
the company can be used to repurchase own shares on the basis of the
authorization. Own shares can be repurchased at a price formed in
public trading on the date of the repurchase or otherwise at a price
formed on the market. The Board of Directors decides how own shares
will be repurchased. Own shares can be repurchased using, inter alia,
derivatives. Own shares can be repurchased otherwise than in
proportion to the shareholdings of the share-holders (directed
repurchase). The authorization cancels the authorization given by the
General Meeting on 14 March 2008 to decide on the repurchase of the
company's own shares. The authorization is effective until 30 June
2010.
Authorizing the Board of Directors to decide on the issuance of
shares as well as the issuance of options and other special rights
entitling to shares
The General Meeting held on March 19, 2009 decided to authorize the
Board of Directors to decide on the issuance of shares as well as the
issuance of options and other special rights entitling to shares
referred to in chapter 10 section 1 of the Companies Act as follows.
The amount of shares to be issued shall not exceed 25,000,000 shares,
which corresponds to approximately 19.32 per cent of all of the
shares in the company. The Board of Directors decides on all the
conditions of the issuance of shares and of special rights entitling
to shares. The authorization concerns both the issuance of new shares
as well as the transfer of treasury shares. The issuance of shares
and of special rights entitling to shares may be carried out in
deviation from the shareholders' pre-emptive rights (directed issue).
The authorization cancels the authorization given by the General
Meeting on 14 March 2008 to decide on the issuance of shares as well
as the issuance of options and other special rights entitling to
shares. The authorization is effective until 30 June 2010.
FLAGGING NOTIFICATIONS
There were no changes in ownership during the period under review
that would have caused flagging notifications which are obligations
for disclosure in accordance with Chapter 2, section 9 of the
Securities Market Act.
BOARD OF DIRECTORS AND AUDITOR
The General Meeting held on March 19, 2009 fixed the number of
members of the Board of Directors to six (6). Mr. Jorma Halonen, Mr.
Jukka Harju, Mr. Juha Hulkko, Mr. Seppo Laine, Mr. Staffan Simberg
and Mr. Erkki Veikkolainen were elected members of the Board of
Directors. The term of office of the members of the Board of
Directors expires at the end of the next Annual General Meeting. At
its assembly meeting held on 19 March 2009, the Board of Directors
has elected Mr. Juha Hulkko Chairman of the Board.
The General Meeting elected Ernst & Young Oy, an auditing entity
authorized by the Central Chamber of Commerce, Auditor of the company
which appointed Mr. Jari Karppinen as the responsible auditor.
DIVIDEND FROM 2008
The General Meeting held on March 19, 2009, decided in accordance
with the proposal of the Board of Directors that no dividend shall be
distributed.
AMENDMENT OF THE ARTICLES OF ASSICIATION
The General Meeting held on March 19, 2009 decided in accordance with
the proposal of the Board of Directors to amend section 7 of the
Articles of Association of the company so that notice to the General
Meeting shall be delivered three weeks before the General Meeting, at
the latest, by publishing it on the company's website or in one or
more newspapers decided by the Board of Directors or by delivering
the notice to each shareholder by a letter posted to the address
reported by the shareholder in the shareholders register.
Oulu, April 30, 2009
EB, Elektrobit Corporation
The Board of Directors
Further Information:
Pertti Korhonen
CEO
Tel. +358 40 344 5466
Outi Torniainen
Director, Communications and Marketing
Tel. +358 40 512 1375
Distribution:
NASDAQ OMX Helsinki
Principal media
INVITATION TO PRESS CONFERENCE ON EB'S 1Q RESULT
EB, Elektrobit Corporation, will hold a press conference for media,
analysts and institutional investors concerning the Interim Report 1Q
2009 on
April 30, 2009 at 11.00- 12.00 hours (CEST+1)
in Oulu, Tutkijantie 8
The conference will be audio webcast and published live on the
Internet through WebEx. The conference will be held in English.
To join the online meeting
1. Go to
https://elektrobit.webex.com/elektrobit/j.php?ED=111509617&UID=1034101832&PW=338b084d8c665b276a25263f757a72
2. Enter your name and email address
3. Enter the meeting password: Kok!ous103
4. Click "Join Now"
In technical problems go to /www.elektrobit.com/webcast/instructions
or call number +358 40 344 5148.
There will be a possibility to present questions in place as well as
by calling to the following conference call number: + 358 20699101,
PIN: 757344#.
A recording of the audio webcast will be available after the
conference on EB's website www.elektrobit.com/investors. The
presentation material will be available after the publication of the
Interim Report on the same address.
CONSENSUS ESTIMATE
The EB consensus estimate made by the analysts who observe the
company is updated approximately a week before the release of the
financial report. The latest estimate is available on the company
website www.elektrobit.com/investors.
April 30, 2009
EB, Elektrobit Corporation
Corporate Communications
EB, ELEKTROBIT CORPORATION, INTERIM REPORT JANUARY - MARCH 2009
(unaudited)
The Interim Report has been prepared in accordance with IAS 34
Interim Financial Reporting.
CONSOLIDATED STATEMENT OF 1-3/2009 1-3/2008 1-12/2008
COMPREHENSIVE INCOME (MEUR)
3 months 3 months 12 months
NET SALES 42.8 47.3 172.3
Other operating income 0.6 1.4 6.2
Change in work in progress and
finished goods -0.3 -0.6 -2.8
Work performed by the undertaking
for its own purpose
and capitalized 0.1 0.1 0.1
Raw materials -2.2 -5.6 -18.0
Personnel expenses -24.6 -27.2 -104.0
Depreciation -2.7 -3.2 -16.4
Other operating expenses -13.7 -20.2 -80.1
OPERATING PROFIT (LOSS) 0.0 -8.0 -42.7
Financial income and expenses -0.9 0.4 -4.7
RESULT BEFORE TAXES -0.9 -7.7 -47.4
Income taxes -0.2 -0.0 -2.4
RESULT FOR THE PERIOD FROM
CONTINUING
OPERATIONS -1.1 -7.7 -49.8
Result after taxes for the period
from discontinued
operations 0.3
RESULT FOR THE PERIOD -1.1 -7.7 -49.5
Other comprehensive income:
Exchange differences on
translating foreign operations 0.3 -0.4 0.6
Other comprehensive income for the
period total 0.3 -0.4 0.6
TOTAL COMPREHENSIVE INCOME FOR THE
PERIOD -0.8 -8.1 -48.9
Result for the period attributable
to
Equity holders of the parent -1.1 -7.7 -49.5
Total comprehensive income
attributable to
Equity holders of the parent -0.8 -8.1 -48.9
Earnings per share EUR continuing
operations
Basic earnings per share -0.01 -0.06 -0.38
Diluted earnings per share -0.01 -0.06 -0.38
Earnings per share EUR discontinued
operations
Basic earnings per share 0.00
Diluted earnings per share 0.00
Earnings per share EUR continuing
and discontinued
Operations
Basic earnings per share -0.01 -0.06 -0.38
Diluted earnings per share -0.01 -0.06 -0.38
Average number of shares, 1000 pcs 129 413 129 413 129 413
CONSOLIDATED STATEMENT OF FINANCIAL March 31, March 31, Dec. 31, 2008
POSITION (MEUR) 2009 2008
ASSETS
Non-current assets
Property, plant and equipment 14.9 24.5 16.2
Goodwill 18.3 19.6 18.3
Intangible assets 10.0 18.2 11.0
Other financial assets 0.4 0.4 0.4
Receivables 0.8 0.7 0.8
Deferred tax assets 3.0 0.1
Non-current assets total 44.4 66.4 46.7
Current assets
Inventories 2.6 7.4 3.3
Trade and other receivables 62.9 64.9 61.9
Financial assets at fair value
through profit or loss 0.2 1.6
Cash and short term deposits 62.8 85.7 68.6
Current assets total 128.5 159.6 133.8
TOTAL ASSETS 172.9 226.0 180.5
EQUITY AND LIABILITIES
Equity attributable to equity
holders of the parent
Share capital 12.9 12.9 12.9
Share premium 64.6 64.6 64.6
Translation difference 0.5 -0.8 0.2
Retained earnings 36.8 78.6 37.4
Total equity 114.8 155.3 115.1
Non-current liabilities
Deferred tax liabilities 2.5 4.2 2.6
Provisions 0.8 1.0
Interest-bearing liabilities 14.2 23.9 15.4
Other liabilities 0.2 0.6 0.7
Non-current liabilities total 17.7 28.7 19.7
Current liabilities
Trade and other payables 30.8 33.4 35.1
Financial liabilities at fair
value through profit or loss 0.1
Pension obligations 1.2 1.1 1.0
Current tax liabilities 0.0
Provisions 2.3 2.5
Interest-bearing loans and
borrowings 6.2 7.5 7.0
Current liabilities total 40.4 42.0 45.7
Total liablities 58.1 70.7 65.4
TOTAL EQUITY AND LIABILITIES 172.9 226.0 180.5
CONSOLIDATED STATEMENT OF CASH FLOWS 1-3/2009 1-3/2008 1-12/2008
(MEUR)
3 months 3 months 12 months
CASH FLOW FROM OPERATING ACTIVITIES
Result for the period -1.1 -7.7 -49.5
Adjustment of accrual basis items 3.3 5.5 27.0
Change in net working capital -4.0 -4.4 2.4
Interest paid on operating activities -1.6 -1.5 -7.3
Interest received from operating
activities 0.9 1.5 4.4
Other financial income and expenses, net
received 0.0
Income taxes paid -0.3 -0.9 -1.7
NET CASH FROM OPERATING ACTIVITIES -2.7 -7.4 -24.7
CASH FLOW FROM INVESTING ACTIVITIES
Acquisition of business unit, net of cash
acquired -0.9
Acquisition of minority interest
Disposal of business unit, net of cash
acquired -0.9 17.5 26.8
Purchase of property, plant and equipment -0.4 -0.3 -1.8
Purchase of intangible assets -0.1 -1.5 -2.6
Purchase of other investments -0.0 -0.5 -0.5
Sale of property, plant and equipment -0.0 0.0 0.2
Sale of intangible assets 0.0
Proceeds from sale of investments 0.0 10.4 10.6
NET CASH FROM INVESTING ACTIVITIES -1.4 25.7 31.8
CASH FLOW FROM FINANCING ACTIVITIES
Proceeds from borrowing 0.2 0.1 0.1
Repayment of borrowing -0.9 -0.8 -1.9
Payment of finance liabilities -1.1 -1.5 -6.0
Dividends paid -2.2 -2.6
NET CASH FROM FINANCING ACTIVITIES -1.7 -4.5 -10.5
NET CHANGE IN CASH AND CASH EQUIVALENTS -5.8 13.8 -3.3
Cash and cash equivalents at beginning of
period 68.6 71.9 71.9
Cash and cash equivalents at end of
period 62.8 85.7 68.6
CONSOLIDATED STATEMENT OF
CHANGES IN EQUITY (MEUR)
A = Share capital
B = Share premium
C = Retained earnings
D = Total equity
A B C D
Equity on January 1, 2008 12.9 64.6 88.1 165.7
Dividend distribution -2.6 -2.6
Share-related compensation 0.2 0.2
Total comprehensive income for the period -8.1 -8.1
Other items 0.1 0.1
Equity on March 31, 2008 12.9 64.6 77.8 115.3
Equity on January 1, 2009 12.9 64.6 37.6 115.1
Share-related compensation 0.2 0.2
Total comprehensive income for the period -0.8 -0.8
Other items 0.3 0.3
Equity on March 31, 2009 12.9 64.6 37.3 114.8
NOTES TO THE INTERIM REPORT
Accounting principles for the Interim Report:
The Interim Report has been prepared in accordance with IAS 34
Interim Financial Reporting. The same accounting policies and methods
of computation are followed in the interim report as compared with
annual financial statements.
The Group has adopted following standards:
IAS 1 (Revised) Presentation of Financial Statements. The revision
mainly addresses the presentation in the income statement and the
statement of changes in equity.
IFRS 8 Operating Segments. The new standard replaces IAS 14 Segment
Reporting. Under IFRS 8, the reporting is based on the management's
internal reporting system and measurement principles. The new
standard doesn't have any impact on the comparative information. The
operating segments are the same as in 2008 according to IAS 14 or
Automotive and Wireless. Items not allocated to segments are
included under Other items.
Explanatory comments about the seasonality or cyclicality of
reporting period operations:
The company operates in business areas which are subject to seasonal
fluctuations.
The nature and amount of items affecting assets, liabilities, equity,
net income, or cash flows which are unusual because of their nature,
size or incidence:
The result of the reporting period comprises non-recurring
restructuring costs of EUR 0.8 million.
Dividends paid:
The General Meeting held on March 19, 2009 decided in accordance with
the proposal of the Board of Directors that no dividend shall be
distributed.
SEGMENT INFORMATION (MEUR)
OPERATING SEGMENTS 1-3/2009 1-3/2008 1-12/2008
3 months 3 months 12 months
Automotive
Net sales to external customers 16.4 15.5 63.3
Net sales to other segments 0.0 0.0 0.1
Net sales total 16.4 15.5 63.4
Operating profit (loss) -0.7 -1.6 -12.1
Wireless
Net sales to external customers 26.3 31.7 108.6
Net sales to other segments 0.1 0.0 0.1
Net sales total 26.4 31.7 108.6
Operating profit (loss) 0.5 -6.5 -28.5
OTHER ITEMS
Other items
Net sales to external customers 0.1 0.1 0.4
Operating profit (loss) 0.2 0.1 -2.1
Eliminations
Net sales to other segments -0.2 -0.0 -0.2
Operating profit (loss) 0.0 0.0 0.0
Group total
Net sales to external customers 42.8 47.3 172.3
Operating profit (loss) 0.0 -8.0 -42.7
Net sales of geographical areas (MEUR) 1-3/2009 1-3/2008 1-12/2008
3 months 3 months 12 months
Net sales
Europe 26.6 26.8 114.9
Americas 11.9 18.5 49.2
Asia 4.4 2.0 8.1
Net sales total 42.8 47.3 172.3
Material events subsequent to the end of the interim period that have
not been reflected in the financial statements for the interim
period:
There are no such material events subsequent to the end of the
interim report period that have not been reflected in the financial
statements for the interim period.
The effect of changes in the composition of the group structure
during the interim period:
On February 2, 2009 EB exited from RFID technology business by
selling 7iD Technologies GmbH to the acting management of the said
company in Austria.
Related party transactions: 1-3/2009 1-3/2008 1-12/2008
Employee benefits for key management and
stock
option expenses total 0.5 0.6 2.7
CONSOLIDATED STATEMENT 1-3/ 10-12/ 7-9/ 4-6/ 1-3/
OF
COMPREHENSIVE INCOME 2009 2008 2008 2008 2008
BY QUARTER (MEUR) 3 months 3 months 3 months 3 months 3 months
NET SALES 42.8 49.5 34.5 41.0 47.3
Other operating income 0.6 1.5 2.6 0.7 1.4
Change in work in
progress and
finished goods -0.3 -1.2 -0.8 -0.1 -0.6
Work performed by the
undertaking
for its own purpose
and capitalized 0.1 0.0 -0.0 0.0 0.1
Raw materials -2.2 -6.6 -2.3 -3.6 -5.6
Personnel expenses -24.6 -27.8 -24.3 -24.8 -27.2
Depreciation -2.7 -3.8 -2.9 -6.5 -3.2
Other operating
expenses -13.7 -20.1 -19.7 -20.1 -20.2
OPERATING PROFIT
(LOSS) 0.0 -8.5 -12.9 -13.3 -8.0
Financial income and
expenses -0.9 -3.3 -1.6 -0.2 0.4
RESULT BEFORE TAXES -0.9 -11.8 -14.4 -13.6 -7.7
Income taxes -0.2 -2.3 -0.1 0.0 -0.0
RESULT FOR THE PERIOD
FROM
CONTINUING OPERATIONS -1.1 -14.0 -14.6 -13.5 -7.7
Result after taxes for
the period
from discontinued
operations 0.1 0.0 0.1 0.0
RESULT FOR THE PERIOD -1.1 -13.9 -14.6 -13.4 -7.7
Other comprehensive
income
for the period total 0.3 0.1 0.8 0.1 -0.4
TOTAL COMPREHENSIVE
INCOME FOR THE PERIOD -0.8 -13.8 -13.7 -13.3 -8.1
Result for the period
attributable to:
Equity holders of
the parent -1.1 -13.9 -14.6 -13.4 -7.7
Total comprehensive
income
for the period
attributable to:
Equity holders of
the parent -0.8 -13.8 -13.7 -13.3 -8.1
CONSOLIDATED STATEMENT March 31, Dec. 31, Sept. 30, June 30, March
OF 31,
FINANCIAL POSITION 2009 2008 2008 2008 2008
(MEUR)
ASSETS
Non-current assets
Property, plant and
equipment 14.9 16.2 17.4 24.3 24.5
Goodwill 18.3 18.3 18.2 17.6 19.6
Intangible assets 10.0 11.0 15.8 16.3 18.2
Other financial
assets 0.4 0.4 0.3 0.3 0.4
Receivables 0.8 0.8 0.9 0.9 0.7
Deferred tax assets 0.1 2.6 3.4 3.0
Non-current assets
total 44.4 46.7 55.3 62.8 66.4
Current assets
Inventories 2.6 3.3 5.8 7.2 7.4
Trade and other
receivables 62.9 61.9 60.2 61.9 64.9
Financial assets at
fair value
through profit or
loss 0.2 0.5 1.6
Cash and short term
deposits 62.8 68.6 67.2 74.8 85.7
Current assets total 128.5 133.8 133.2 144.4 159.6
TOTAL ASSETS 172.9 180.5 188.5 207.2 226.0
EQUITY AND LIABILITIES
Equity attributable to
equity holders
of the parent
Share capital 12.9 12.9 12.9 12.9 12.9
Share premium 64.6 64.6 64.6 64.6 64.6
Translation
difference 0.5 0.2 0.1 -0.8 -0.8
Retained earnings 36.8 37.4 51.0 65.6 78.6
Total equity 114.8 115.1 128.6 142.3 155.3
Non-current
liabilities
Deferred tax
liabilities 2.5 2.6 3.2 3.5 4.2
Provisions 0.8 1.0 1.2
Interest-bearing
liabilities 14.2 15.4 15.9 22.8 23.9
Other liabilities 0.2 0.7 0.6 0.6 0.6
Non-current
liabilities total 17.7 19.7 20.8 26.8 28.7
Current liablities
Trade and other
payables 30.8 35.1 26.2 28.0 33.4
Financial
liabilities at fair
value
through profit or
loss 0.1 1.1
Pension obligations 1.2 1.0 1.1 1.1 1.1
Provisions 2.3 2.5 0.7
Interest-bearing
loans and
borrowings
(non-current) 6.2 7.0 9.9 8.9 7.5
Current liabilities
total 40.4 45.7 39.1 38.0 42.0
Total liablities 58.1 65.4 59.9 64.8 70.7
TOTAL EQUITY AND
LIABILITIES 172.9 180.5 188.5 207.2 226.0
CONSOLIDATED STATEMENT 1-3/ 10-12/ 7-9/ 4-6/ 1-3/
OF CASH FLOWS BY QUARTER 2009 2008 2008 2008 2008
3 months 3 months 3 months 3 months 3 months
Net cash from
operating activities -2.7 -0.5 -7.7 -9.0 -7.4
Net cash from
investing activities -1.4 5.7 0.5 -0.0 25.7
Net cash from
financing activities -1.7 -3.8 -0.4 -1.8 -4.5
Net change in cash and
cash
equivalents -5.8 1.4 -7.6 -10.9 13.8
FINANCIAL PERFORMANCE RELATED RATIOS 1-3/2009 1-3/2008 1-12/2008
3 months 3 months 12 months
STATEMENT OF COMPREHENIVE INCOME (MEUR)
Net sales 42.8 47.3 172.3
Operating profit (loss) 0.0 -8.0 -42.7
Operating profit (loss), % of net
sales 0.0 -16.9 -24.8
Result before taxes -0.9 -7.7 -47.4
Result before taxes, % of net sales -2.1 -16.2 -27.5
Result for the period -1.1 -7.7 -49.8
PROFITABILITY AND OTHER KEY FIGURES
Interest-bearing net liabilities,
(MEUR) -42.4 -54.3 -46.2
Net gearing, -% -36.9 -35.0 -40.2
Equity ratio, % 68.2 69.5 64.9
Gross investments, (MEUR) 0.8 3.7 9.8
Average personnel during the period 1663 1771 1768
Personnel at the period end 1628 1762 1735
AMOUNT OF SHARE ISSUE ADJUSTMENT March 31, March 31, Dec. 31,
(1,000 pcs) 2009 2008 2008
At the end of period 129 413 129 413 129 413
Average for the period 129 413 129 413 129 413
Average for the period diluted with
stock options 129 413 129 413 129 413
STOCK-RELATED FINANCIAL RATIOS (EUR) 1-3/2009 1-3/2008 1-12/2008
3 months 3 months 12 months
Basic earnings per share -0.01 -0.06 -0.38
Diluted earnings per share -0.01 -0.06 -0.38
Equity *) per share 0.89 1.20 0.89
*) Equity attributable to equity
holders of the parent
MARKET VALUES OF SHARES (EUR) 1-3/2009 1-3/2008 1-12/2008
Highest 0.46 1.79 1.79
Lowest 0.33 1.42 0.29
Average 0.39 1.67 0.82
At the end of period 0.37 1.43 0.33
Market value of the stock, (MEUR) 47.9 185.1 42.7
Trading value of shares, (MEUR) 1.6 3.9 9.6
Number of shares traded, (1,000 pcs) 4 025 2 351 11 770
Related to average number of shares % 3.1 1.8 9.1
SECURITIES AND CONTINGENT LIABILITIES March 31, March 31, Dec. 31,
(MEUR) 2009 2008 2008
AGAINST OWN LIABILITIES
Floating charges 3.1 3.1 3.1
Mortgages 7.0
Pledges 0.9 9.5 1.1
Guarantees 4.0 2.1 4.1
Mortgages are pledged for liabilities
totaled 9.5 16.8 9.9
OTHER DIRECT AND CONTINGENT LIABILITIES
Rental liabilities
Falling due in the next year 3.8 4.4 4.2
Falling due after one year 4.4 6.4 5.1
NOMINAL VALUE OF CURRENCY DERIVATIVES March 31, March 31, Dec. 31,
(MEUR) 2009 2008 2008
Foreign exchange forward contracts
Market value 0.2 1.6 -0.1
Nominal value 10.1 43.2 11.9
Purchased currency options
Market value 0.3
Nominal value 7.0
Sold currency options
Market value -0.3
Nominal value 14.0
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