2007-04-24 12:00:35 CEST
2007-04-24 12:00:35 CEST
REGULATED INFORMATION
Outokumpu Oyj - Quarterly report
Outokumpu first quarter 2007 interim report - another record operating profit
First quarter highlights
- Operating profit rose to an all-time high of EUR 424 million.
- Stainless steel end-user demand was strong, order intake from
distribution sector slowed.
- According to CRU, average stainless steel base prices rose by 5%
and transaction prices by 8% from the previous quarter.
- Record high nickel prices increased working capital by EUR 349
million, net cash generated from operating activities totaled EUR 85
million.
- Gearing improved further to 37.3%.
Group key figures
I/07 IV/06 I/06 2006
Sales EUR million 2 129 1 907 1 408 6 154
Operating profit EUR million 424 378 67 824
Non-recurring items
in operating profit EUR million - 1 - 1
Profit before taxes EUR million 416 369 60 784
Net profit for the period
from continuing
operations EUR million 311 286 41 606
Net profit for the period EUR million 307 603 56 963
Earnings per share
from continuing
operations EUR 1.71 1.58 0.23 3.34
Earnings per share EUR 1.69 3.33 0.31 5.31
Return on capital employed % 38.8 36.5 7.5 20.7
Net cash generated
from operating activities EUR million 85 -82 37 -35
Capital expenditure,
continuing operations EUR million 25 74 33 187
Net interest-bearing debt
at end of period EUR million 1 189 1 300 1 483 1 300
Debt-to-equity ratio
at end of period % 37.3 42.3 73.0 42.3
Stainless steel deliveries 1 000 tons 433 445 510 1 815
Stainless steel base price 1) EUR/ton 1 930 1 840 1 127 1 470
Personnel at the end of period,
continuing operations 8 098 8 159 8 529 8 159
1) Stainless steel: CRU - German base price (2 mm cold rolled 304
sheet)
SHORT-TERM OUTLOOK
Underlying demand for stainless steel continues to be strong.
Outokumpu's direct deliveries to end-users and project customers are
scheduled as far as the fourth quarter and Group mills that produce
specialty products are running at full capacity. In standard volume
products, however, distributors are decreasing their inventories and
are hesitant in placing new orders. This has resulted in lower order
books at Outokumpu's mills that produce volume products. Due to
shortened order book Outokumpu has decided to cut production by some
10% in the second quarter. Outokumpu continually monitors market
developments and will adjust its actions accordingly.
Record high nickel prices have raised transaction prices of stainless
steel and together with de-stocking by distributors have put pressure
on base prices. Base prices for stainless steel standard grades are
softening from the record high levels reached in the first months of
the year and also market visibility regarding these products is
short. Outokumpu currently estimates that the second quarter average
base price for 304 sheet in the German market will be some EUR
300-350 per ton lower than the CRU-quoted base price of EUR 1 830 in
March. It should be noted, however, that there are big differences in
base prices between the different countries in Europe.
Outokumpu's operating profit for the second quarter, including
increasing nickel-related inventory gains, is estimated to be in
excess of EUR 300 million. Specialty Stainless' profit is expected to
continue at a very good level, whereas there is pressure related to
General Stainless' profit development. Assuming there is no major
negative impact from nickel price volatility, Outokumpu's whole year
operating profit is estimated to be clearly better than in 2006.
CEO Juha Rantanen:"I am very pleased with the excellent results achieved in the first
quarter. Although markets for standard grades are now softening, the
cost reduction initiatives we carried out during 2006 mean we are in
a very competitive position to face these new market circumstances,
part of the cyclical nature of our industry.
As part of our strategy, we are working hard to reduce the volatility
of our performance. Important elements in this are strengthening the
service we offer to direct end-users and increasing the share of
specialty products. In line with this ambition, three important
investment decisions were taken during the quarter: the Tornio
annealing and pickling line replacement, Nyby product mix improvement
and a new service center in Poland. Being now financially much
stronger, we are also actively looking for growth opportunities, both
organic and structural. All potential alternatives are tested against
strict financial criteria to make sure we are not compromising our
long-term financial goals."
The attachments present Management analysis of the first quarter
operating result and the Interim review by the Board of Directors for
January-March 2007, the accounts and notes to the interim accounts.
This interim report is unaudited.
For further information, please contact:
Kari Lassila, SVP - IR and Communications, tel. +358 9 421 2555
kari.lassila@outokumpu.com
Eero Mustala, SVP - Corporate Communications, tel. +358 9 421 2435
eero.mustala@outokumpu.com
Esa Lager, CFO, tel +358 9 421 2516
esa.lager@outokumpu.com
News conference and live webcast today at 3.00 pm
A combined news conference, conference call and live web-cast
concerning the first-quarter interim report will be held on April 24,
2007 at 3.00 pm Finnish time (8.00 am US EST, 1.00 pm UK time, 2.00
pm CET) at Hotel Kämp, conference room Akseli Gallen-Kallela,
Pohjoisesplanadi 29, 00100 Helsinki, Finland.
To participate via a conference call, please dial in 5-10 minutes
before the beginning of the event:
UK +44 20 7162 0025
US & Canada +1 334 323 6201
Password Outokumpu
The news conference can be viewed live via Internet at
www.outokumpu.com.
Stock exchange release and presentation material will be available
before the news conference at www.outokumpu.com -> Investors ->
Downloads
An on-demand web-cast of the news conference will be available at
www.outokumpu.com as of April 24, 2007 at around 6.00 pm.
An instant replay service of the conference call will be available
until Friday April 27, 2007 on the following numbers:
UK replay number +44 20 7031 4064, access code: 746 529
US & Canada replay number +1 954 334 0342, access code: 746 529
OUTOKUMPU OYJ
Corporate Management
Ingela Ulfves
Vice President - Investor Relations
tel. + 358 9 421 2438, mobile +358 40 515 1531, fax +358 9 421 2125
e-mail: ingela.ulfves@outokumpu.com
www.outokumpu.com
MANAGEMENT ANALYSIS - FIRST-QUARTER OPERATING RESULT
Group key figures
EUR million I/06 II/06 III/06 IV/06 2006 I/07
Sales
General Stainless 1 013 1 066 1 130 1 561 4 770 1 700
Specialty Stainless 650 638 614 821 2 723 1 003
Other operations 87 93 97 85 361 64
Intra-group sales -342 -405 -394 -560 -1 700 -638
The Group 1 408 1 392 1 447 1 907 6 154 2 129
Operating profit
General Stainless 43 91 166 236 536 245
Specialty Stainless 22 65 81 171 338 182
Other operations 2 -8 -13 -16 -35 1
Intra-group items -0 1 -3 -13 -15 -4
The Group 67 149 231 378 824 424
Stainless steel deliveries
1 000 tons I/06 II/06 III/06 IV/06 2006 I/07
Cold rolled 286 239 200 211 936 230
White hot strip 104 103 80 103 390 79
Quarto plate 44 44 35 39 162 43
Tubular products 20 20 16 18 74 20
Long products 14 15 14 16 59 17
Semi-finished
products 43 47 47 58 195 44
Total deliveries 510 467 393 445 1 815 433
Market prices and exchange rates
I/06 II/06 III/06 IV/06 2006 I/07
Market prices 1)
Stainless steel
Base price EUR/t 1 127 1 342 1 572 1 840 1 470 1 930
Alloy surcharge EUR/t 844 1 020 1 437 2 064 1 341 2 277
Transaction price EUR/t 1 971 2 362 3 009 3 904 2 811 4 207
Nickel USD/t 14 810 19 925 29 154 33 129 24 254 41 440
EUR/t 12 318 15 836 22 878 25 707 19 317 31 619
Ferrochrome
(Cr-content) USD/lb 0.63 0.70 0.75 0.78 0.72 0.77
EUR/kg 1.16 1.23 1.30 1.33 1.26 1.30
Molybdenum USD/lb 23.38 25.01 26.47 25.56 25.10 26.69
EUR/kg 42.86 43.82 45.79 43.73 44.08 44.90
Recycled steel USD/t 200 238 243 239 230 278
EUR/t 167 189 191 185 183 212
Exchange rates
EUR/USD 1.202 1.258 1.274 1.289 1.256 1.311
EUR/SEK 9.352 9.298 9.230 9.135 9.254 9.189
EUR/GBP 0.686 0.688 0.680 0.673 0.682 0.671
1) Sources of market prices:
Stainless steel: CRU - German base price, alloy surcharge and
transaction price (2 mm cold rolled 304 sheet), estimates for
deliveries during the period
Nickel: London Metal Exchange (LME) cash quotation
Ferrochrome: Metal Bulletin - Ferrochrome lumpy chrome charge, basis
52% chrome
Molybdenum: Metal Bulletin - Molybdenum oxide - Europe
Recycled steel: Metal Bulletin - Steel scrap HMS 1&2 fob Rotterdam
End-user demand good, distribution sector de-stocking
Global apparent consumption of stainless steel flat products remained
on the previous quarter level but was 8% higher than in I/2006. In
Europe, underlying demand continued to be strong, but de-stocking by
distributors slowed demand and order intake of the mills for standard
products fell resulting in shortened lead times. Demand for stainless
steel special products generally remained at high levels. Stainless
steel base prices continued to rise in the early part of the quarter,
but turned to decline thereafter. According to CRU, the base price
for 304 cold rolled stainless steel sheet in Germany was
1 930 EUR/ton in the first quarter, up 5% from IV/2006. The average
transaction price was 4 207 EUR/ton, up by 8%. The alloy surcharge
has continued to increase month-on-month. According to CRU, the
average alloy surcharge for 304 cold rolled stainless steel sheet in
Germany was 2 277 EUR/ton in the quarter, 10% up on the previous
quarter. Together with high base prices, this resulted in stainless
steel transaction prices reaching their highest-ever levels. The
difference in price between Chinese and European stainless steel was
reduced in the period as a result of Chinese producers raising
significantly their domestic prices to offset higher raw material
prices.
Of the alloying elements, the price of nickel set successive records
in the period and exceeded 50 000 USD/ton in mid-March. The average
price in the first quarter was 41 440 USD/ton, 25% up from IV/2006and 180% higher compared to I/2006. The supply of nickel was tight,
but part of the extensive price increase is generally explained as a
result of speculation in financial markets. Demand for ferrochrome
increased, but the average price fell slightly to 0.77 USD/lb. The
average price of molybdenum rose by 4% to 26.69 USD/lb. The price of
recycled steel rose by 16%.
Another record in quarterly operating profit
Group sales in the first quarter totaled EUR 2 129 million, 12% up on
the previous quarter. Sales rose as a result of higher transaction
prices while deliveries fell slightly to 433 000 tons (IV/2006: 445
000 tons). Outokumpu achieved another record operating profit of EUR
424 million, an increase of 12% compared to IV/2006. Return on
capital employed improved to 38.8%. Both General Stainless and
Specialty Stainless posted improved profits. The rise in base prices,
internal profit improvement measures and nickel-related inventory
gains all contributed to this result. The amount of inventory gains,
however, was more modest than respective gains in the two preceding
quarters.
General Stainless' sales rose by 9% to EUR 1 700 million even though
deliveries were 6% lower than in IV/2006. Operating profit totaled
EUR 245 million, of which Tornio Works posted EUR 227 million. The
new batch annealing furnaces in Tornio were taken into use and
production of ferritic stainless steel commenced in March.
Specialty Stainless' sales rose by 22% to EUR 1 003 million and
deliveries were up by 5%. Operating profit was EUR 182 million, 7%
higher than in IV/2006. The expansion at Kloster Thin Strip in Sweden
comprised a new cold rolling line, a bright annealing line and a
slitting line. Production is being ramped up and the first deliveries
took place in March.
Excellence programs gaining momentum
The Commercial and Production Excellence programs launched in 2005
are progressing well and have already achieved tangible results. The
targeted combined profit improvements from the Commercial Excellence
and Production Excellence programs are expected to total EUR 40
million in 2007, EUR 80 million in 2008 and EUR 160 million on an
annual basis thereafter.
Benefit follow-up systems have been established to identify the
savings, increased revenues and costs associated with the programs.
The achievement of the expected benefits is included in the targets
for the Group's incentive schemes and the benefits realized will also
be audited. As to 2007, based on the progress so far, management is
confident that the targeted EUR 40 million will be achieved.
Of the Group's other profit improvement initiatives, the fixed-cost
reduction program was completed by the end of 2006. The new EUR 100
million lower targeted annual fixed cost running rate has been in
full effect from the beginning of 2007. Also the annual profit
improvement of EUR 50 million resulting from the closure of the
Sheffield coil products unit in April 2006 will be fully realized in
2007.
Year of Commercial kicked off
A focus on commercial activities is a key theme throughout the Group
and 2007 has been named the Year of Commercial. A number of projects
and initiatives are being launched in the commercial arena during
this year in addition to the ones already running such as the
Commercial Excellence program.
A stronger emphasis on service center operations is part of
Outokumpu's commercial goal of increasing the scope of our offering
to end-user customers. Service centers are located close to the
customers and serve them with tailored coil and plate products.
Outokumpu is in the process of expanding and developing the centers
to provide additional value-added services to customers.
In March, Outokumpu opened a new service center for plate and tubular
products on the Group's site at Sheffield in the UK. The plate
service center in Jyväskylä in Finland will be revamped by doubling
its capacity and adding new value-added services. In Eskilstuna in
Sweden, the coil stock & processing operations serving Nordic markets
will also be expanded. These services are scheduled to be available
by the end of 2007.
In order to better serve the growing market in Eastern Europe,
Outokumpu has decided to establish a new stainless steel service
center near Katowice in the south of Poland. This operation will be a
combination of a coil service center with slitting and cut-to-length
lines, together with a plate service center with plasma and water jet
cutting. The new center is scheduled to be operational by the end of
2008.
INTERIM REVIEW BY THE BOARD OF DIRECTORS - JANUARY-MARCH 2007
(Unaudited)
High stainless steel prices
The strong increase in demand that characterized stainless steel
markets in 2006 began to slow during the first quarter of 2007. After
having increased throughout 2006, global apparent consumption of
stainless steel flat products remained on the fourth quarter 2006
levels, but was still 8% higher than in I/2006. According to CRU, the
German base price for 304 2mm sheet rose by 40 EUR/ton to 2 020
EUR/ton in January, but declined to 1 940 EUR/ton in February and to
1 830 EUR/ton in March. The average base price of 1 930 EUR/ton was
71% higher than in I/2006. Extremely high prices for nickel resulted
in transaction prices of stainless steel continuing to rise
throughout the first quarter averaging 4 207 EUR/ton, up by 8% from
the previous quarter and 113% above I/2006.
Record operating profit, modest cash flow
Group sales in the quarter rose to EUR 2 129 million (I/2006: EUR 1
408 million), 51% up on I/2006. Sales increased as a result of
significantly higher transaction prices, even though stainless steel
deliveries declined to 433 000 tons compared to 510 000 tons in the
first quarter in 2006. This decline is primarily attributable to the
closure of the Sheffield coil products unit in the UK in April 2006.
Operating profit was at an all-time high of EUR 424 million (I/2006:
EUR 67 million). The excellent profit was a result of higher base
prices, nickel-related inventory gains and internal improvement
measures.
Net financial expenses totaled EUR 10 million (I/2006: EUR 7
million). Net profit for the period from continuing operations
totaled EUR 311 million (I/2006: EUR 41 million) and net loss from
discontinued operations totaled EUR 4 million (I/2006: net profit of
EUR 15 million). Earnings per share from continuing operations was
EUR 1.71 and from discontinued operations EUR 0.02 negative. Return
on capital employed rose to 38.8% (I/2006: 7.5%).
Despite the excellent result net cash generated from operating
activities was modest at EUR 85 million (I/2006: EUR 37 million). EUR
349 million was tied up in working capital during the quarter
primarily as a consequence of record high nickel price. Net
interest-bearing debt fell by EUR 111 million to EUR 1 189 million
(Dec. 31, 2006: EUR 1 300 million) and gearing improved further to
37.3% (Dec. 31, 2006: 42.3%).
New investment projects approved
Capital expenditure totaled EUR 25 million (I/2006: EUR 33 million).
Production in the EUR 55 million expansion in Kloster, Sweden, was
ramped up during the first quarter. Several new investment projects
for 2007-2009 were approved, all of them within the capital
expenditure frame of EUR 175 million for 2007.
Replacement of one of the five annealing and pickling lines at Tornio
Works will provide additional capacity totaling 75 000 tons of cold
rolled products. It will also improve the capability to produce
brighter ferritic steel grades and enhance Outokumpu's flexibility in
meeting customer needs. This replacement is the second step for
Outokumpu in entering the ferritic market. It will complement the EUR
13 million investment in batch annealing furnaces in the hot rolling
mill, which commenced ferritics production in the first quarter of
2007. The new annealing and pickling line will be capable of
producing austenitic and ferritic products with minimum set-up times.
The investment will increase Tornio Works' nominal annual cold
rolling capacity to more than 1 250 000 tons by the end of 2009. The
total value of this investment is EUR 90 million, spread over three
years.
In order to better serve the growing market in Eastern Europe,
Outokumpu decided to establish a new stainless steel service center
near Katowice in the south of Poland. This operation will be a
combination of a coil service center with slitting and cut-to-length
lines, together with a plate service center with plasma and water jet
cutting. It will serve Poland and other countries in the region such
as the Czech Republic, Slovakia and Hungary and will also address new
potential markets in Eastern Europe. The total investment is some EUR
20 million and the new center is scheduled to be operational by the
end of 2008.
To increase capacity in stainless steel special grades, an investment
in surface grinding and automatic storage and retrieval equipment
will take place at Thin Strip Nyby in Sweden. The equipment will be
housed in a new building and will increase the share of special grade
sales at the expense of standard grade products in Nyby. This EUR 27
million investment will allow the plant to double its annual special
grades capacity in cold rolled stainless steel products from 34 000
to 64 000 tons and take advantage of the rapidly-growing market for
special grades. The full capacity will be operational by the end of
2008.
Divestments
In March, OSTP (Outokumpu Stainless Tubular Products) sold its flange
business in order to focus on pipes, tubes, butt-welded and threaded
fittings. The purchaser is a subsidiary of Shree Ganesh Forgings Ltd,
an Indian company. The flange business is currently run by OSTP's
subsidiaries Hertecant N.V. in Belgium and E.L.F.E. SA in France.
Hertecant's sales totaled EUR 12 million in 2006 and it employs some
50 persons. E.L.F.E is a sales company employing six persons. This
divestment had no significant impact on Group results.
In February, Outokumpu agreed to sell the Hitura nickel mine in
Finland to Belvedere Resources Ltd. of Canada. The Hitura mine is the
last remaining asset in Outokumpu's Exit Mining program. Hitura
produces some 2 200 tons of nickel in concentrate annually and
employs 90 people. The total consideration of some EUR 10 million
will be paid in Belvedere shares. A final agreement was signed in
March and the transaction is scheduled to be closed by the end of
June 2007. It will be recognized in the Group's result for the second
quarter.
Environment, health and safety
As participants in the European Union Greenhouse Gas emissions
trading system, the Tornio integrated plant in Finland and the melt
shops and casting plants in Avesta and Degerfors in Sweden have
verified the actual carbon dioxide emissions in 2006 and
corresponding allowances will be surrendered to the authorities by
the end of April. Preparations for emissions trading in the Kyoto-
period 2008-2013 have commenced, and the applications are being
submitted to the respective authorities.
The new European regulation concerning chemicals (REACH) was adopted
in December 2006 and will come into effect on June 1, 2007. All
substances manufactured in or imported into the European Union in
quantities that exceed one ton per year must be registered. For
amounts that exceed ten tons per
year, a safety assessment must be made. Outokumpu has made
preparations for REACH by updating safety declarations and
assessments relating to chemicals in current use and has also revised
the Group's chemicals management systems.
At Outokumpu sites, emissions to air and discharges to water remained
mostly within permitted limits and the breaches that occurred were
temporary, were identified quickly and caused only minimal
environmental impact.
Occupational safety is a major continuous focus area in the Group.
The lost-time injury rate target (i.e. lost-time accidents per
million working hours) is less than 12 in 2007 and less than five in
2009. The achievement of the target in 2007 is included in the
Group's incentive schemes. An essential part of raising safety
awareness and preventing risk situations is the compilation of data
on near misses and the safety training given to the employees and
also contractors. During January-March 2007, the lost-time injury
rate was 11 (I/2006: 17) thus improving in line with the annual
target.
Personnel
The Group's continuing operations employed an average of 8 129 people
(I/2006: 8 746) during January-March 2007and there were 8 098
employees at the end of March (Dec. 31, 2006: 8 159).
Vision statement updated
Outokumpu's Board of Directors has approved the addition of a new
strategic objective termed "Sustaining Value" to the Group's vision
statement. The expression "Sustaining value by continuously
developing our people and putting the customer at the heart of
everything we do" highlights the fact that a competent and
customer-oriented organization listens to the needs and wishes of its
customers and thereby creates sustained competitiveness. The Group's
updated vision is as follows:
Outokumpu's vision is to be the undisputed number one in stainless
with success based on operational excellence.
Key strategic objectives:
- Value creation through building superior production and
distribution capabilities in all major markets globally
- Value realization through commercial and production excellence
- Sustaining value by continuously developing our people and putting
the customer at the heart of everything we do
Customs investigation on Outokumpu Tornio Works' exports to Russia
Finnish Customs Authorities have initiated a criminal investigation
on Outokumpu's exports practices to Russia. Several Outokumpu
employees have been questioned in connection with the investigation.
Outokumpu cooperates fully with the authorities, who have indicated
that the investigation would be concluded by the end of 2007.
In Outokumpu's on-going own investigation, carried out by external
legal experts, so far nothing indicates that the export process to
Russia would as such be illegal or that Outokumpu personnel would
have anything to do with any alleged duplication or manipulation of
documentation.
Class actions related to divested fabricated copper products business
The fabricated copper products business that was sold in 2005
comprised among others Outokumpu Copper (USA), Inc. This company has
been served with several complaints in cases filed in federal
district courts and state courts in US by various plaintiffs. The
complaints allege claims and damages under US antitrust laws and
purport to be class actions on behalf of all direct and indirect
purchasers of copper plumbing tubes and ACR tubes in the US.
Outokumpu believes that the allegations in these cases are groundless
and will defend itself in any such proceeding. In connection with the
transaction to sell the fabricated copper products business to Nordic
Capital, Outokumpu has agreed to indemnify and hold harmless Nordic
Capital with respect to these class actions.
Bo Annvik appointed to Group Executive Committee
Mr. Bo Annvik has been appointed Executive Vice President - Specialty
Businesses and will be a member of Outokumpu's Group Executive
Committee. He will take up his position in June. Mr. Annvik, a
Swedish national, was born in 1965 and holds a B.Sc. in Business
Administration and Economics from the Gothenburg School of Economics.
He is currently employed by SKF as President - SKF Sealing Solutions.
Mr. Annvik's portfolio in the Group Executive Committee will include
supervision of Avesta Works, Hot Rolled Plate, Thin Strip and OSTP
business units. Currently, Avesta Works reports to Pekka Erkkilä, EVP
- Production Operations, and the other three units report to CEO Juha
Rantanen.
Annual General Meeting of March 28, 2007
The Annual General Meeting (AGM) approved a dividend of EUR 1.10 per
share for 2006. Dividends totaling EUR 199 million were paid on April
11, 2007.
The AGM authorized the Board of Directors to repurchase the Company's
own shares. The maximum number of shares to be repurchased is 18 000
000.The AGM authorized the Board of Directors to decide to issue
shares and grant share entitlements. The maximum number of new shares
to be issued under a share issue and/or by exercising share
entitlements is 18 000 000, currently representing 9,93% of the
Company's issued and outstanding shares and, in addition, the maximum
number of treasury shares to be transferred is 18 000 000, currently
representing 9,93% of the Company's issued and outstanding shares.
These authorizations are valid until the Annual General Meeting in
2008, however no longer than May 31, 2008. As of April 24, 2007, the
authorizations had not been exercised.
The Annual General Meeting approved amendments to the Articles of
Association: removing references to the minimum and maximum capital
and maximum number of shares, revising the matters to be included on
the agenda of the Annual General Meeting and removing the provision
concerning redemption liability. Minor changes of a technical nature
to the Articles of Association were also approved.
The AGM decided on the number of the Board members, including the
Chairman and Vice Chairman, to be eight. For the term expiring at the
close of the following AGM, Mr. Evert Henkes, Mr. Jukka Härmälä, Mr.
Ole Johansson, Ms. Anna Nilsson-Ehle, Ms. Leena Saarinen and Mr.
Taisto Turunen were re-elected as members of the Board of Directors,
and Ms. Victoire de Margerie and Mr. Leo Oksanen were elected as new
members. Mr. Jukka Härmälä was re-elected as Chairman of the Board of
Directors and Mr. Ole Johansson as Vice Chairman. The AGM also
resolved to form a Shareholders' Nomination Committee to prepare
proposals on the composition and remuneration of the Board of
Directors for presentation to the next AGM.
KPMG Oy Ab, Authorized Public Accountants, was re-elected as the
Company's auditor for the term ending at the close of the next AGM.
At its first meeting, the Board of Directors appointed two permanent
committees consisting of board members. Mr. Ole Johansson (Chairman),
Ms. Leena Saarinen and Mr. Taisto Turunen were re-elected as members
of the Board Audit Committee. Mr. Jukka Härmälä (Chairman), Mr. Evert
Henkes and Ms. Anna Nilsson-Ehle were re-elected as members of the
Board Nomination and Compensation Committee.
Short-term outlook
Underlying demand for stainless steel continues to be strong.
Outokumpu's direct deliveries to end-users and project customers are
scheduled as far as the fourth quarter and Group mills that produce
specialty products are running at full capacity. In standard volume
products, however, distributors are decreasing their inventories and
are hesitant in placing new orders. This has resulted in lower order
books at Outokumpu's mills that produce volume products. Due to
shortened order book Outokumpu has decided to cut production by some
10% in the second quarter. Outokumpu continually monitors market
developments and will adjust its actions accordingly.
Record high nickel prices have raised transaction prices of stainless
steel and together with de-stocking by distributors have put pressure
on base prices. Base prices for stainless steel standard grades are
softening from the record high levels reached in the first months of
the year and also market visibility regarding these products is
short. Outokumpu currently estimates that the second quarter average
base price for 304 sheet in the German market will be some EUR
300-350 per ton lower than the CRU-quoted base price of EUR 1 830 in
March. It should be noted, however, that there are big differences in
base prices between the different countries in Europe.
Outokumpu's operating profit for the second quarter, including
increasing nickel-related inventory gains, is estimated to be in
excess of EUR 300 million. Specialty Stainless' profit is expected to
continue at a very good level, whereas there is pressure related to
General Stainless' profit development. Assuming there is no major
negative impact from nickel price volatility, Outokumpu's whole year
operating profit is estimated to be clearly better than in 2006.
Espoo April 24, 2007
Board of Directors
CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
Condensed income statement
Jan-March Jan-March Jan-Dec
EUR million 2007 2006 2006
Continuing operations:
Sales 2 129 1 408 6 154
Other operating income 11 11 44
Costs and expenses -1 714 -1 352 -5 364
Other operating expenses -2 -1 -11
Operating profit 424 67 824
Share of results in
associated companies 2 0 8
Financial income and expenses
Interest income 6 5 26
Interest expenses -21 -22 -88
Market price gains and losses -2 11 12
Other financial income 10 0 8
Other financial expenses -3 -2 -5
Profit before taxes 416 60 784
Income taxes -105 -18 -178
Net profit for the period
from continuing operations 311 41 606
Discontinued operations:
Net profit/(loss)
for the period
from discontinued operations -4 15 357
Net profit for the period 307 56 963
Attributable to:
Equity holders of the Company 305 56 962
Minority interest 2 -0 2
Earnings per share
for profit attributable
to the equity holders
of the Company:
Earnings per share, EUR 1.69 0.31 5.31
Diluted earnings per share, EUR 1.68 0.31 5.29
Earnings per share
from continuing operations
attributable to the
equity holders
of the Company:
Earnings per share, EUR 1.71 0.23 3.34
Earnings per share
from discontinued operations
attributable to the equity
holders of the Company:
Earnings per share, EUR -0.02 0.08 1.97
Condensed balance sheet
March 31 March 31 Dec 31
EUR million 2007 2006 2006
ASSETS
Non-current assets
Intangible assets 487 574 493
Property, plant
and equipment 2 030 2 101 2 069
Non-current financial assets
Interest-bearing 400 290 375
Non interest-bearing 84 57 77
3 001 3 021 3 014
Current assets
Inventories 1 858 1 059 1 710
Current financial assets
Interest-bearing 74 67 55
Non interest-bearing 1 461 1 040 1 314
Cash and cash equivalents 140 165 85
3 533 2 331 3 164
Assets held for sale 222 201 235
Total assets 6 756 5 553 6 414
EQUITY AND LIABILITIES
Equity
Equity attributable
to the equity
holders of the Company 3 170 2 016 3 054
Minority interest 18 14 17
3 188 2 030 3 071
Non-current liabilities
Interest-bearing 1 271 1 554 1 293
Non interest-bearing 344 342 337
1 615 1 896 1 630
Current liabilities
Interest-bearing 687 584 685
Non interest-bearing 1 199 974 955
1 886 1 559 1 640
Liabilities related to
assets held for sale 67 68 73
Total equity
and liabilities 6 756 5 553 6 414
Consolidated statement of changes in equity
Attributable to the equity
holders of
the Company
Share Un- Share Other Fair
capital regis- premium reserves value
tered fund reserves
share
EUR million capital
Equity on
January 1, 2006 308 - 701 11 23
Cash flow hedges - - - - -3
Fair value gains on
available-for-sale
financial assets - - - - 123
Net investment hedges - - - - -
Change in
translation differences - - - - -
Items recognised
directly in equity - - - - 121
Net profit for the
period - - - - -
Total recognised
income and expenses - - - - 121
Unregistered share
capital - 0 - - -
Dividend distribution - - - - -
Management stock
option program:
value of received
services - - - - -
Equity on
December 31, 2006 308 0 701 11 144
Cash flow hedges - - - - -1
Fair value gains on
available-for-sale
financial assets - - - - 29
Net investment hedges - - - - -
Change in
translation differences - - - - -1
Items recognised
directly in equity - - - - 28
Net profit for the
period - - - - -
Total recognised
income and expenses - - - - 28
Transfers from
unregistered share
capital 0 -0 - - -
Dividend distribution - - - - -
Shares subscribed
with options 0 - 0 - -
Management stock
option program:
value of received
services - - - - -
Equity on
March 31, 2007 308 - 701 11 171
Attributable to the equity
holders of
the Company
Treasury Cumu- Re- Minority Total
shares lation tained interest equity
trans- earn-
lation ings
diffe-
EUR million rences
Equity on
January 1, 2006 -2 -38 1 044 15 2 062
Cash flow hedges - - - - -3
Fair value gains on
available-for-sale
financial assets - - - - 123
Net investment hedges - -2 - - -2
Change in translation
differences - 6 - 0 6
Items recognised
directly in equity - 4 - 0 125
Net profit for the
period - - 962 2 963
Total recognised
income and expenses - 4 962 2 1 088
Unregistered share
capital - - - - 0
Dividend distribution - - -81 - -81
Management stock
option program:
value of received
services - - 2 - 2
Equity on
December 31, 2006 -2 -35 1 927 17 3 071
Cash flow hedges - - - - -1
Fair value gains on
available-for-sale
financial assets - - - - 29
Net investment hedges - 3 - - 3
Change in
translation differences - -22 - 0 -23
Items recognised
directly in equity - -19 - 0 9
Net profit for the
period - - 305 2 307
Total recognised
income and expenses - -19 305 2 316
Transfers from
unregistered share
capital - - - - -
Dividend distribution - - -199 - -199
Shares subscribed
with options - - - - 0
Management stock
option program:
value of received
services - - 1 - 1
Equity on
March 31, 2007 -2 -53 2 034 18 3 188
Condensed statement of cash flows
Jan-March Jan-March Jan-Dec
EUR million 2007 2006 2006
Net profit for the period 307 56 963
Adjustments
Depreciation and amortization 51 53 229
Impairments 2 1 12
Gain on the sale of
Outokumpu Technology shares - - -328
Other adjustments 128 25 215
Increase in working capital -349 -38 -975
Dividends received 9 0 7
Interests received 2 4 17
Interests paid -15 -21 -89
Income taxes paid -51 -42 -87
Net cash from operating activities 85 37 -35
Purchases of assets -32 -44 -183
Proceeds from the sale of subsidiaries 4 20 338
Proceeds from the sale of shares
in associated companies - - 9
Proceeds from the sale of other assets 2 3 20
Net cash from other investing activities 2 -0 14
Net cash from investing activities -24 -21 198
Cash flow before
financing activities 61 16 163
Borrowings of long-term debt - 46 174
Repayment of long-term debt -3 -69 -380
Increase/(decrease) in current debt -1 -22 3
Dividends paid - - -81
Other financing cash flow 0 -16 -2
Net cash from financing activities -4 -61 -286
Adjustments 0 -0 0
Net change in cash
and cash equivalents 56 -45 -123
Cash and cash equivalents
at the beginning of the period 85 212 212
Foreign exchange rate effect -1 -3 -5
Net change in cash and cash equivalents 56 -45 -123
Cash and cash equivalents
at the end of the period 140 165 85
Key figures
Jan-March Jan-March Jan-Dec
EUR million 2007 2006 2006
Operating profit margin, % 19.9 4.7 13.4
Return on capital employed, % 38.8 7.5 20.7
Return on equity, % 39.3 11.0 37.5
Return on equity from
continuing operations, % 39.8 8.1 23.6
Capital employed at end of period 4 377 3 513 4 371
Net interest-bearing
debt at end of period 1 189 1 483 1 300
Equity-to-assets ratio
at end of period, % 47.2 37.4 47.9
Debt-to-equity ratio
at end of period, % 37.3 73.0 42.3
Earnings per share, EUR 1.69 0.31 5.31
Earnings per share from
continuing operations, EUR 1.71 0.23 3.34
Earnings per share from
discontinued operations, EUR -0.02 0.08 1.97
Average number of shares
outstanding, in thousands 1) 181 061 181 032 181 033
Fully diluted
earnings per share, EUR 1.68 0.31 5.29
Fully diluted average number
of shares, in thousands 1) 182 087 181 431 181 758
Equity per share
at end of period, EUR 17.51 11.14 16.87
Number of shares
outstanding at end of period,
in thousands 1) 181 082 181 032 181 032
Capital expenditure,
continuing operations 25 33 187
Depreciation, continuing operations 51 50 221
Average personnel for the period,
continuing operations 8 129 8 746 8 505
1) The number of own shares repurchased is excluded.
NOTES TO THE INCOME STATEMENT AND BALANCE SHEET
This interim financial report is prepared in accordance with IAS 34
(Interim Financial Reporting). The same accounting policies and
methods of computation have been followed in the interim financial
statements as in the annual financial statements for 2006.
Use of estimates
The preparation of the financial statements in accordance with IFRS
requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities, as well as the disclosure
of contingent assets and liabilities at the date of the financial
statements, and the reported amounts of income and expenses during
the reporting period. Accounting estimates are employed in the
financial statements to determine reported amounts, including the
realizability of certain assets, the useful lives of tangible and
intangible assets, income taxes, provisions, pension obligations,
impairment of goodwill and other items. Although these estimates are
based on management's best knowledge of current events and actions,
actual results may differ from the estimates.
Shares and share capital
The total number of Outokumpu Oyj shares was 181 300 967 and the
share capital amounted to EUR 308.2 million on March 31, 2007.
Outokumpu Oyj held 218 603 treasury shares on March 31, 2007. This
corresponded to 0.1% of the share capital and the total voting rights
of the Company on March 31, 2007.
The 2003 stock options have been allocated as part of the Group's
incentive programs to key personnel of Outokumpu. Trading with
Outokumpu Oyj's stock options 2003A commenced on the Main List of the
Helsinki Stock Exchange as of September 1, 2006. On March 31, 2007 a
total of 50 412 Outokumpu Oyj shares had been subscribed for on the
basis of 2003A stock option program. An aggregate maximum of 608 890
Outokumpu Oyj shares can be subscribed for with the remaining 2003A
stock options. In accordance with the terms and conditions of the
option program, the dividend adjusted share price for a stock option
was EUR 9,55 on March 31, 2007. The share subscription period for the
2003A stock options is September 1, 2006 - March 1, 2009. The current
amounts that Outokumpu Oyj shares could be subscribed for with the
2003B and 2003C stock options are as follows: 2003B 1 028 820 shares
and 2003C 87 500 shares. The subscription period for shares with
stock option 2003B is from September 1, 2007 to March 1, 2010 and
with stock option 2003C it is from September 1, 2008 to March 1,
2011. As a result of the share subscriptions with the 2003 stock
options, Outokumpu Oyj's share capital may be increased by a maximum
of EUR 2 932 857 and the number of shares by a maximum of 1 725 210
shares. This corresponds to 1.0% of the Company's shares and voting
rights.
Outokumpu's Board of Directors confirmed in 2006 a share-based
incentive program for years 2006-2010 as part of the key employee
incentive and commitment system of the Company. If persons to be
covered by the first earning period 2006-2008 and the second earning
period 2007-2009 of the program were to receive the number of shares
in accordance with the maximum reward, currently a total of 616 580
shares, their shareholding obtained via the program would amount to
0.3% of the Company's shares and voting rights.
The detailed information of the 2003 option program and of the
share-based incentive program for 2006-2010 is presented in the
annual report 2006.
Non-current assets held for sale and discontinued operations
Outokumpu Copper Tube and Brass
The assets and liabilities of Outokumpu Copper Tube and Brass are
presented as held for sale. Outokumpu Copper Tube and Brass business
comprises European sanitary and industrial tubes, including
air-conditioning and refrigeration tubes in Europe, as well as brass
rod. Outokumpu is implementing a vigorous improvement project in this
business and it is Outokumpu's intention to divest the tube and brass
business.
Outokumpu Technology
Outokumpu Oyj sold 88% of Outokumpu Technology by a sale of shares
through an Initial Public Offering (IPO) in September 2006. The
remaining holding in Outokumpu Technology is reported as an available
for sale financial asset, valued at fair value recognized directly in
equity. On March 31, 2007 the fair value of Outokumpu's 12% holding
in Outokumpu Technology totaled EUR 145 million.
In the following tables Outokumpu Technology is referred to as OT,
Outokumpu Tube and Brass as TB and Outokumpu Copper as OC.
Jan-
March Jan-March
Income statement 2007 2006
EUR million TB Total OT TB
Sales 175 314 144 169
Expenses -176 -297 -140 -157
Operating profit -1 16 4 12
Net financial items -2 0 2 -1
Profit/(loss) before taxes -3 17 6 11
Taxes -1 -2 -1 -0
Profit/(loss) after taxes -4 16 5 11
Gain on the sale of
Outokumpu Technology - - - -
Impairment loss
recognized on the fair valuation of
the Tube and Brass
division's assets and liabilities -0 -1 - -1
Taxes - - - -
After-tax result from
the disposal and impairment loss -4 15 5 10
Minority interest - -0 0 -0
Net profit/(loss) for the period
from discontinued operations -4 15 5 10
Jan-
March Jan-Dec
Income statement 2007 2006
EUR million TB Total OT TB
Sales 175 1 178 501 678
Expenses -176 -1 124 -470 -654
Operating profit -1 54 31 23
Net financial items -2 -2 5 -7
Profit/(loss) before taxes -3 53 36 17
Taxes -1 -17 -14 -3
Profit/(loss) after taxes -4 35 22 14
Gain on the sale of
Outokumpu Technology - 328 328 -
Impairment loss recognized
on the fair valuation of
the Tube and Brass division's
assets and liabilities -0 -6 - -6
Taxes - - - -
After-tax result from
the disposal and impairment loss -4 322 328 -6
Minority interest - 0 0 -
Net profit/(loss) for the period
from discontinued operations -4 357 349 8
March March Dec
Balance sheet 31 31 31
EUR million 2007 2006 2006
Assets
Intangible and tangible assets 6 6 6
Other non-current assets 4 4 4
Inventories 100 90 122
Other current non
interest-bearing assets 113 102 104
222 201 235
Liabilities
Provisions 3 6 3
Other non-current non
interest-bearing liabilities 4 4 6
Trade payables 46 44 46
Other current non
interest-bearing liabilities 15 14 18
67 68 73
Jan- Jan- Jan-
Cash flows March March Dec
EUR million 2007 2006 2006
Operating cash flows 1 -13 -13
Investing cash flows -1 -2 -145
Financing cash flows -1 13 80
Total cash flows -1 -2 -77
Major non-recurring items in operating profit
Jan-March Jan-March Jan-Dec
EUR million 2007 2006 2006
Gain on sale of
real estate in the UK - - 9
OSTP Fagersta closure - - -8
- - 1
Income taxes
Jan-March Jan-March Jan-Dec
EUR million 2007 2006 2006
Current taxes -99 -9 -156
Deferred taxes -6 -10 -22
-105 -18 -178
Property, plant and equipment
March 31 March 31 Dec 31
EUR million 2007 2006 2006
Historical cost at the
beginning of the period 4 009 4 188 4 188
Translation differences -38 -16 37
Additions 26 29 179
Disposal of subsidiaries -6 -0 -0
Disposals -2 -5 -299
Reclassifications -0 -8 -8
Discontinued operations - - -88
Historical cost
at the end of the period 3 989 4 188 4 009
Accumulated depreciation at
the beginning of the period -1 939 -2 063 -2 063
Translation differences 21 12 -21
Disposal of subsidiaries 5 0 0
Disposals 0 3 296
Reclassifications 0 8 8
Depreciation -47 -47 -204
Impairments - - -3
Discontinued operations - - 48
Accumulated depreciation
at the end of the period -1 959 -2 087 -1 939
The Group's major off-balance sheet investment commitments
on March 31, 2007 totaled EUR 4 million (Dec. 31, 2006: EUR 15
million).
Commitments
March 31 March 31 Dec 31
EUR million 2007 2006 2006
Mortgages and pledges
Mortgages on land 132 128 126
Other pledges 0 4 0
Guarantees
On behalf of subsidiaries
For commercial commitments 90 88 97
On behalf of associated companies
For financing 5 4 5
Other commitments 58 64 59
Minimum future lease payments
on operating leases 66 119 93
Fair values and
nominal amounts
of derivative instruments
March 31 March 31 March 31
2007 2007 2007
Positive Negative Net
EUR million fair value fair value fair value
Currency and interest
rate derivatives
Currency forwards 19 13 6
Interest rate swaps 10 - 10
Metal derivatives
Forward and futures copper
contracts 4 0 4
Forward and futures nickel
contracts 18 1 17
Forward and futures zinc contracts 0 0 0
Electricity derivatives
Publicly traded
electricity derivatives 0 0 0
Other electricity derivatives 14 10 4
66 25 41
Fair values and nominal amounts
of derivative instruments
Dec 31 March 31 Dec 31
2006 2007 2006
Net Nominal Nominal
EUR million fair value amounts amounts
Currency and interest
rate derivatives
Currency forwards -9 2 348 2 139
Interest rate swaps 10 282 283
Tons Tons
Metal derivatives
Forward and futures copper
contracts -1 5 550 6 000
Forward and futures nickel
contracts 9 3 126 3 636
Forward and futures zinc contracts 0 1 325 2 150
TWh TWh
Electricity derivatives
Publicly traded
electricity derivatives 0 0.0 0.0
Other electricity derivatives 8 3.6 4.1
16
Segment information
General Stainless
EUR million I/06 II/06 III/06 IV/06 2006 I/07
Sales 1 013 1 066 1 130 1 561 4 770 1 700
of which Tornio Works 652 740 781 1 142 3 316 1 206
Operating profit 43 91 166 236 536 245
of which Tornio Works 37 70 120 213 440 227
Operating capital
at the end of period 2 397 2 404 2 602 2 847 2 847 3 047
Average personnel
for the period 3 926 3 940 3 857 3 529 3 735 3 506
Deliveries of
main products (1 000 tons)
Cold rolled 246 206 172 180 805 194
White hot strip 74 85 62 84 305 62
Semi-finished products 128 144 126 154 551 137
Total deliveries
of the division 448 434 360 419 1 661 392
Specialty Stainless
EUR million I/06 II/06 III/06 IV/06 2006 I/07
Sales 650 638 614 821 2 723 1 003
Operating profit 22 65 81 171 338 182
Operating capital
at the end of period 1 173 1 240 1 350 1 594 1 594 1 668
Average personnel
for the period 4 317 4 377 4 329 4 201 4 289 4 146
Deliveries of main
products (1 000 tons)
Cold rolled 56 54 39 47 196 55
White hot strip 49 41 33 42 166 37
Quarto plate 44 44 36 39 162 43
Tubular products 20 20 16 18 74 20
Long products 14 15 14 16 59 17
Total deliveries
of the division 182 173 139 162 656 171
Other operations
EUR million I/06 II/06 III/06 IV/06 2006 I/07
Sales 87 93 97 85 361 64
Operating profit 2 -8 -13 -16 -35 1
Operating capital
at the end of period 133 239 188 138 138 -125
Average personnel
for the period 504 505 479 457 481 477
Income statement by quarter
EUR million I/06 II/06 III/06 IV/06 2006 I/07
Continuing operations:
Sales
General Stainless 1 013 1 066 1 130 1 561 4 770 1 700
of which
intersegment sales 205 277 273 389 1 144 421
Specialty Stainless 650 638 614 821 2 723 1 003
of which
intersegment sales 94 92 82 129 397 169
Other operations 87 93 97 85 361 64
of which
intersegment sales 44 36 38 41 159 48
Intra-group sales -342 -405 -394 -560 -1 700 -638
Total sales 1 408 1 392 1 447 1 907 6 154 2 129
Operating profit
General Stainless 43 91 166 236 536 245
Specialty Stainless 22 65 81 171 338 182
Other operations 2 -8 -13 -16 -35 1
Intra-group items -0 1 -3 -13 -15 -4
Total operating profit 67 149 231 378 824 424
Share of results
in associated companies 0 2 1 4 8 2
Financial income
and expenses -7 -10 -18 -13 -48 -10
Profit before taxes 60 141 214 369 784 416
Income taxes -18 -29 -48 -83 -178 -105
Net profit
for the period
from continuing
operations 41 112 166 286 606 311
Net profit/(loss)
for the period
from discontinued
operations 15 20 6 317 357 -4
Net profit for
the period 56 133 172 603 963 307
Attributable to:
Equity holders
of the Company 56 132 171 603 962 305
Minority interest -0 0 1 1 2 2
Major non-recurring items in operating profit
EUR million I/06 II/06 III/06 IV/06 2006 I/07
General Stainless
Gain on sale of real
estate in the UK - - - 9 9 -
Specialty Stainless
OSTP Fagersta closure - - - -8 -8 -
- - - 1 1 -
Key figures by quarter
EUR million I/06 II/06 III/06
Operating profit margin, % 4.7 10.7 16.0
Return on capital employed, % 7.5 16.5 24.3
Return on equity, % 11.0 25.2 30.4
Return on equity,
continuing operations, % 8.1 21.4 29.4
Capital employed at end of period 3 513 3 679 3 910
Net interest-bearing debt
at end of period 1 483 1 509 1 560
Equity-to-assets ratio
at end of period, % 37.4 38.4 37.7
Debt-to-equity ratio
at end of period, % 73.0 69.5 66.4
Earnings per share, EUR 0.31 0.73 0.94
Earnings per share from
continuing operations, EUR 0.23 0.62 0.91
Earnings per share from
discontinued operations, EUR 0.08 0.11 0.03
Average number of shares
outstanding, in thousands 1) 181 032 181 032 181 032
Equity per share at
end of period, EUR 11.14 11.91 12.89
Number of shares outstanding
at end of period, in thousands 1) 181 032 181 032 181 032
Capital expenditure,
continuing operations 33 34 45
Depreciation,
continuing operations 50 50 68
Average personnel for the
period, continuing operations 8 746 8 822 8 665
Key figures by quarter
EUR million IV/06 I/07
Operating profit margin, % 19.8 19.9
Return on capital employed, % 36.5 38.8
Return on equity, % 89.0 39.3
Return on equity,
continuing operations, % 42.3 39.8
Capital employed at end of period 4 371 4 377
Net interest-bearing debt
at end of period 1 300 1 189
Equity-to-assets ratio
at end of period, % 47.9 47.2
Debt-to-equity ratio
at end of period, % 42.3 37.3
Earnings per share, EUR 3.33 1.69
Earnings per share from
continuing operations, EUR 1.58 1.71
Earnings per share from
discontinued operations, EUR 1.75 -0.02
Average number of shares
outstanding, in thousands 1) 181 037 181 061
Equity per share at
end of period, EUR 16.87 17.51
Number of shares outstanding
at end of period, in thousands 1) 181 032 181 082
Capital expenditure,
continuing operations 74 25
Depreciation,
continuing operations 52 51
Average personnel for the
period, continuing operations 8 187 8 129
1) The number of own shares repurchased is excluded.
Definitions of key financial figures
Total equity + net interest-bearing
Capital employed = debt
Operating capital = Capital employed + net tax liability
×
Return on equity = Net profit for the period 100
------------------------------------
Total equity (average for the period)
×
Return on capital = Operating profit 100
------------------------------------
Capital employed (average for the
employed (ROCE) period)
Net interest- Total interest-bearing debt
bearing debt = - total interest-bearing assets
Equity-to-assets ×
ratio = Total equity 100
--------------------------------
Total assets - advances received
Debt-to-equity x
ratio = Net interest-bearing debt 100
--------------------------
Total equity
Net profit for the period
Earnings per share = attributable to the equity holders
---------------------------------
Adjusted average number
of shares during the period
Equity attributable to
Equity per share = the equity holders
---------------------------
Adjusted number of shares at the end of the period
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