2012-02-08 08:00:00 CET
2012-02-08 08:01:39 CET
REGULATED INFORMATION
Okmetic Oyj - Financial Statement Release
FINANCIAL STATEMENTS FOR 1 JANUARY - 31 DECEMBER 2011: ANOTHER RECORD YEAR FOR OKMETIC, PROFITABILITY REMAINED STRONG IN THE SEMICONDUCTOR INDUSTRY'S DOWNTURN
OKMETIC OYJ STOCK EXCHANGE RELEASE 8 FEBRUARY 2012 AT 9.00 A.M.
FINANCIAL STATEMENTS FOR 1 JANUARY - 31 DECEMBER 2011: ANOTHER RECORD YEAR FOR
OKMETIC, PROFITABILITY REMAINED STRONG IN THE SEMICONDUCTOR INDUSTRY'S DOWNTURN
Unless otherwise stated, figures in parenthesis refer to the corresponding
period in the previous year.
JANUARY-DECEMBER IN BRIEF:
* Net sales amounted to 83.2 (80.9) million euro, up 2.8%.
* Operating profit was 11.8 (10.4) million euro corresponding to 14.2% of net
sales.
* Profit for the period was 10.2 (10.0) million euro.
* Basic earnings per share were 0.61 (0.60) euro.
* Net cash flow from operations amounted to 11.7 (16.6) million euro.
* The board of directors will propose to the annual general meeting that a
dividend of 0.28 euro per share will be distributed for the financial year
2011.
OCTOBER-DECEMBER IN BRIEF:
* Net sales amounted to 18.1 (23.1) million euro, down 21.4%.
* Operating profit was 2.3 (3.4) million euro corresponding to 12.9% of net
sales.
* Profit for the period was 2.0 (2.1) million euro.
* Basic earnings per share were 0.12 (0.13) euro.
* Net cash flow from operations amounted to 5.4 (6.7) million euro.
PROJECTIONS FOR THE NEAR FUTURE
The customer industries are estimated to grow in all of Okmetic's main product
groups in 2012 too, but the growth forecasts are so far moderate. The downturn
in the semiconductor industry which started in mid 2011 continues during the
first quarter, after which the demand is expected to pick up again.
The development of sensor wafer demand is estimated to be somewhat more stable
in 2012 than the demand for semiconductor wafers. The sensor wafer growth
forecast for the ongoing year is also a bit higher than that of semiconductor
wafers. Technology sales will focus on solar crystal sales, and be fairly even
throughout the year.
The net sales and operating profit for the whole year 2012 are estimated to
exceed the level of 2011, although, due to the market trend, they will still
remain under the level of the comparison period in the first quarter.
PRESIDENT KAI SEIKKU:"Profitability remained strong also in the end of the year. Operating profit
percent was 12.9% in the last quarter and 14.2% in the entire financial period.
The figures clearly exceed the company's long-term objectives and represent a
high level in component and material based business. Factors behind the good
profitability were the strong demand for sensor wafers throughout the year,
flexible supply chain that is partly based on contract manufacturing, and
successful management of fixed costs.
The semiconductor industry continued to slow down in the end of the year, and as
was anticipated, the last quarter was the weakest of the year. The comparison
period's net sales included polysilicon sales, and the decrease of comparable
sales in the last quarter was around 15%.
In April, the company published a significant, around 30 million euro investment
programme to increase the production capacity of SOI wafers at the Vantaa
production plant. The SOI wafer production volumes have increased month by
month, and a new record level was still reached in December. The increasing
capacity as well as other investments in demanding sensor wafers support the
company's strategy where growth is sought from rapidly developing MEMS
applications. Okmetic is the market's leading wafer supplier in this interesting
sector.
The company increased its market shares also in the second half of 2011 although
the total market development slowed down and turned negative at times. The
beginning of 2012 will still be a continuation of slower demand in the
semiconductor industry as customers are levelling their stocks. The company's
view is that the demand picks up again in the second quarter and strengthens in
the second half of the year. The estimates for the entire industry are cautious.
However, of the customer areas important for Okmetic, MEMS applications and
discrete and power semiconductors grow faster than the total market.
Technology sales will focus on serving the solar cell industry. This industry
experienced strong volume increase of approximately 40% in 2011. The level of
installations made during 2011 is estimated to have exceeded the level of 25GW.
The growth was spurred by the price level plunging throughout the value chain,
when the quickly increased overcapacity led to clearing the stocks. The market
is expected to pick up during the second half of 2012, when the stock situation
becomes balanced, and the strong end demand is likely to continue. Okmetic
benefits from long-term customer agreements in this partly challenging market
situation."
KEY FIGURES
1,000 euro 1.10.- 1.10.- 1.1.- 1.1.- 1.1.-
31.12.11 31.12.10 31.12.11 31.12.10 31.12.09
Net sales 18,134 23,072 83,186 80,907 54,361
Operating
profit
before
depreciation
(EBITDA) 3,848 5,050 18,069 17,102 7,121
Operating
profit 2,338 3,440 11,817 10,421 185
% of net sales 12.9 14.9 14.2 12.9 0.3
Profit/loss for
the period 1,988 2,146 10,235 9,952 -513
Basic earnings
per share,
euro 0.12 0.13 0.61 0.60 -0.03
Net cash flow
from operating
activities 5,431 6,730 11,691 16,594 6,315
Net interest-
bearing
liabilities -10,257 -18,047 -10,257 -18,047 -4,770
Equity ratio, % 78.9 76.6 78.9 76.6 78.9
Average number
of personnel
during the period 351 340 363 345 337
MARKETS
Customer industries sensor, semiconductor, and solar cell industries
Sensor industry
According to different estimates, the sale value of sensor industry increased by
approximately 10 percent in 2011 compared to the previous year. The development
of sensor sales has been influenced by the increased use of micro sensors in
many consumer electronics products. In 2012, the sale value of sensor industry
is estimated to increase by 10-20 percent compared to 2011. In terms of volume,
the sensor shipments will clearly rise to a record level in 2012. In the near
future, the sale value of sensor industry is estimated to grow 10-15 percent
annually. (IHS iSuppli, Yole, Semico)
Certain silicon-based microelectromechanical (MEMS) products within the sensor
segment have higher growth rates than the others. The shipment volumes of
gyroscopes experienced especially strong growth in 2011, the annual growth was
over 40 percent (IHS iSuppli). Also, the demand of pressure sensors,
accelerometers, microphones, and micromechanical filters increased. Silicon-on-
insulator (SOI) technology is increasingly used, among others, in the
manufacture of these products. Okmetic is amongst the pioneering suppliers who
provide SOI wafers to the sensor industry.
Semiconductor industry
The semiconductor industry's sales in US dollars have slightly declined during
the last quarter of 2011 compared to both the corresponding period in 2010 and
the third quarter of 2011. The sales of 2011 amounted to 299.5 billion US
dollars (up 0.4%) (SIA).
The slowdown of the sales growth which started in mid 2011 has moderated, and
once the stock levels start to decrease, the industry is expected to return to a
solid growth path in the second half of 2012 (IHS iSuppli, Gartner,
Morningstar).
The demand for DRAM memory circuits which significantly affects the total demand
of the semiconductor market is still expected to decrease (IHS iSuppli). In a
market essential for Okmetic, semiconductors for automotive electronics, for
example, the outlook is positive, and a growth of 2.2-4.5 percent is predicted
for the total market in 2012 (WSTS, Gartner, VLSI research). In 2012, the growth
rate of power semiconductors is estimated to slightly exceed the semiconductor
market average (IMS).
A group of growing applications, such as smart phones and tablet computers, play
a key role in the growth of semiconductors (IC Insights, Gartner). For the near
future, the growth estimates for semiconductor demand settle at a level of
4.8-6.0 percent (IDC, RNCOS).
Solar cell industry
The usage of solar energy for electricity production continued to expand rapidly
during 2011. During the year, the industry's demand varied strongly due to
oversupply and international financial crisis. Fluctuation in demand caused
significant increase in stock levels and decline in prices throughout the
industry's supply chain. Accelerated by the heavily increased demand at the end
of the year, the market of the whole year is predicted to have exceeded the
level of 25GW (IHS iSuppli, IMS Research). Oversupply is expected to continue in
the beginning of 2012 and the market situation is estimated to recover gradually
along with the declining stock levels and continuously growing market.
Silicon wafer market
According to the statistics published in February 2012 by SMG, the group of
silicon wafer suppliers in SEMI, the surface area of wafer shipments in the
whole silicon wafer industry in 2011 decreased by three percent compared to
2010 area shipments. The transfer of the market to bigger wafer sizes along with
the technological development was stronger than average. Compared to the
previous year, a growth of 3 percent is estimated for 2012.
Okmetic's central customer areas in the silicon wafer market
In line with its strategy, Okmetic seeks for special areas of the entire silicon
wafer market that have greater growth rates than the market average and in which
the company has special know-how. Okmetic supplies primarily 150mm and 200mm
wafers. The sensor/MEMS industry is Okmetic's central growth area. The MEMS
market grows as the portable consumer products, automotive electronics, and
industrial process control increase.
In the semiconductor market, Okmetic's growth areas include discrete and power
semiconductors. The growth areas of these markets are i.a. components used in
the production of renewable energy, increasing automotive electronics, portable
consumer products, developing applications of the medical and well-being
industries as well as industrial process controlling.
SALES
In 2011, Okmetic's net sales increased by 2.8 (48.8) percent from the previous
year amounting to 83.2 (80.9) million euro. The reasons behind the increase in
net sales were the growth of sensor wafer sales and sales aimed at the solar
cell industry. Okmetic's market share grew in the product areas which are
important to the company.
Sales per customer area
1.10.- 1.10.- 1.1.- 1.1.- 1.1.-
31.12.11 31.12.10 31.12.11 31.12.10 31.12.09
Sensors 54% 41% 46% 43% 41%
Semiconductors 30% 40% 35% 42% 31%
Technology 16% 18% 19% 15% 28%
In 2011, the sensor wafer sales increased compared to the previous year. Within
sensor wafers, the rise in production volumes of the strategically important SOI
wafers was particularly positive. The use of sensors and their requirement level
are expected to continue growing. Sensor applications are increasing in the
automotive industry, and also particularly in consumer electronics products like
smart phones, cameras, game consoles, and other mobile devices.
Semiconductor wafer sales decreased in the second half of 2011 due to the
prevailing market situation. The growth estimates are moderate at the moment.
In 2011, technology sales increased and its net sales consisted mainly of solar
crystal shipments.
Sales per market area
1.10.- 1.10.- 1.1.- 1.1.- 1.1.-
31.12.11 31.12.10 31.12.11 31.12.10 31.12.09
North America 43% 41% 37% 43% 37%
Europe 31% 22% 30% 25% 33%
Asia 27% 37% 33% 32% 30%
In 2011, Okmetic's sales increased in Europe and Asia, but decreased in North
America.
PROFITABILITY
January-December
In January-December, Okmetic's operating profit was 11.8 (10.4) million euro.
The operating profit accounted for 14.2 (12.9) percent of net sales. Profit for
the period was 10.2 (10.0) million euro. Tax expenses in the financial period
2011 amounted to 1.1 million euro (in 2010 tax revenue of 0.1 million euro). The
imputed taxes include 0.3 million euro of claims for the established losses of a
foreign subsidiary. The deferred tax assets consisting of the established losses
of the parent company were exhausted during the financial period 2011. Basic
earnings per share were 0.61 (0.60) euro. Diluted earnings per share were 0.59
(0.58) euro.
October-December
In October-December, Okmetic's operating profit was 2.3 (3.4) million euro. The
operating profit accounted for 12.9 (14.9) percent of net sales. Profit for the
period was 2.0 (2.1) million euro. Basic earnings per share were 0.12 (0.13)
euro. Diluted earnings per share were 0.12 (0.12).
FINANCING
The company's financial situation is good. In 2011, net cash flow from
operations amounted to 11.7 (16.6) million euro.
In 2011, the net cash flow from operations was weakened by 6.8 (0.2) million
euro due to an increase in working capital available to business operations.
This was caused by changes in normal net working capital items.
On 31 December 2011, the company's liabilities amounted to 1.0 (1.0) million
euro.
At the end of 2011, cash and cash equivalents amounted to 11.3 (14.0) million
euro. In addition, the company had 5.0 million euro worth of investments in
fixed-income funds at the end of 2010. On 31 December 2011, the company's cash
and cash equivalents exceeded the interest-bearing liabilities by 10.3 million
euro (on 31 December 2010 cash and cash equivalents were 18.0 million euro
higher than interest-bearing liabilities).
Return on equity amounted to 17.2 (18.6) percent. At the end of the year, the
company's equity ratio was 78.9 (76.6) percent. Equity per share was 3.68 (3.49)
euro.
INVESTMENTS
In 2011, Okmetic's capital expenditure amounted to 12.0 (2.2) million euro.
The investments concerned mainly the board's decision in April to increase SOI
wafer production capacity by extending the Vantaa plant. The around 30 million
euro investment programme, to be implemented in 2011-2013, includes the plant
extension and different kinds of production equipment. Building of the plant
extension started in August.
This investment, together with the SOI equipment investments decided earlier,
more than triples the Vantaa plant's SOI wafer production capacity and enables
increase of market share in SOI wafers.
At the beginning of the year, Okmetic purchased ten crystal growing furnaces
located at the Vantaa production plant from the Norwegian company NorSun. The
furnaces originate from an arrangement made in 2006, in which NorSun placed the
furnaces in the Vantaa production plant. The total value of the investment
amounted to 3.3 million euro.
As a result of the investment, Okmetic's own crystal growing capacity increased
significantly. The purchased furnaces are used for the production of solar
crystals and for the crystal growing required for the own production and
contract manufacturing of silicon wafers. Okmetic thus secured sufficient
production capacity for the needs of coming years.
PRODUCT DEVELOPMENT
In 2011, the company expensed 2.4 (2.1) million euro in product development
projects. Product development costs accounted for 2.9 (2.6) percent of net
sales. The product development costs have not been capitalised.
In 2011, Okmetic's product development was mainly directed at SOI wafers and
crystal growing. In addition to these areas, the aim was to develop the
processes of all production lines further. Regarding SOI wafers, in addition to
expanding the production capacity, the focus was on improving the performance
and productivity, as well as on developing the SOI product family further. In
crystal growing, Okmetic's aim was to improve productivity and performance of
the process, and also to expand the portfolio of high resistivity products by
including FZ materials in the product range.
Okmetic engaged in several strategic research projects with customers, research
institutes, and other partners. In 2011, Okmetic participated in national
technology programmes funded by Tekes, the leading Finnish funding agency for
technology and innovation, and in international EU-funded programmes as well as
in creation of the national and international MEMS Roadmap. The purpose of the
MEMS Roadmap is to coordinate the longer term R&D investment of MEMS.
Okmetic's research and development work increases the company's technological
expertise and competitiveness. Research and development focuses on developing
new products and improving the features and the production process performance
of the existing products. Okmetic also collaborates closely with equipment and
material manufacturers, in particular when purchasing new equipment, in order to
secure an optimal equipment base.
PERSONNEL
The significance of the personnel as a factor contributing to Okmetic's success
has been recognised in the company's strategy, and is emphasised in the values
as well as in human resources and quality policies of the company.
On average, Okmetic employed 363 people in 2011 (2010: 345 and 2009: 337). At
the end of the year, 312 of the group's employees worked in Finland, 34 in the
US, three in Japan, and one in Hong Kong.
Women accounted for 26 (27) percent and men 74 (73) percent of the personnel.
White-collar employees accounted for 36 (36) percent and blue-collar employees
for 64 (64) percent. The average age of Okmetic's employees was 43 (42) years
and the average length of employment was 10.9 (10.3) years.
Salaries and bonuses are based on the level of skills required in each position
throughout the organisation. In 2011, salaries and bonuses amounted to 20.7
million euro (2010: 19.8 million euro and 2009: 15.9 million euro) including
1.2 (1.3) million euro expenses of the share reward schemes. The group's parent
company complies with the collective labour agreements of the Technology
Industries of Finland.
All employee groups at Okmetic are eligible for an incentive scheme. Monthly
targets are set for the blue-collar employees' productivity, and the resulting
bonuses are paid once a month. White-collar employees are paid bonuses according
to group level targets. Bonuses for meeting the targets are calculated as a
percentage of the employees' annual income. The bonuses account for no more than
12-20 percent of annual income depending on the personnel group.
ENVIRONMENTAL ISSUES
Okmetic recognises the environmental risks associated with its business. The
company devises both a universal risk management plan and plans for individual
processes. Ecologically sustainable operations boost Okmetic's competitiveness
and profitability.
Measures devised for eliminating environmental risks are integrated to Okmetic's
operational processes. Environmental considerations are factored into the
development of products and operations in line with continuous improvement
principles. Planning of preventive measures is fundamental to managing
environmental risks.
Okmetic keeps an eye on environmental legislation development both in Finland
and internationally, and adjusts its operations to meet the regulations. During
2011, a new legislation monitoring application was deployed. It makes following
up the continuously changing legislation straightforward and efficient.
Okmetic follows the chemical regulations of the European Union (REACH) and all
Okmetic's products meet the requirements set in the RoHS-directive.
The main goal of Okmetic's environmental programme in 2011 was to launch and
sertificate an environmental system for the epi wafer production plant in the
US. The operation was granted an ISO 14001 certificate in June 2011.
Okmetic has now ISO 9001:2008, TS 16949:2009 and ISO 14001:2004 certified
quality and environmental systems at both plants. The company's plants have been
built with environmental considerations in mind. Okmetic expects its most
important subcontractors and suppliers to comply with the ISO 9001 and ISO
14001 certifications.
The consumption of energy and the use of water and main raw materials have been
assessed to have a significant environmental impact. The company strives to use
them as efficiently as possible. Recycling of waste and materials is emphasised.
At the Vantaa plant, the objective of the environmental programme was to reduce
the landfill waste to zero. This objective was reached in 2011.
Okmetic had no major environmental non-conformities in 2011. Okmetic's
environmental management methods were found to match the high requirement level
of international customer companies. The company is not subject to emissions
trading regulations.
The key figures on environmental protection at the Vantaa plant in 2011 are as
follows:
Energy consumption (GWh): electricity 32.9 (34.2), district heating 2.7 (3.1).
Water comsumption (tm3): water 560 (558), waste water 474 (477).
Waste volumes (t): hazardous waste 264 (187), landfill waste 0 (170), recycled
waste 299 (244).
BUSINESS RISKS
Okmetic's business operations are exposed to risks which may arise from the
company's operations or changes in the business environment.
Okmetic's silicon wafer sales are targeted at the sensor and semiconductor
producers in the electronics industry. The demand for semiconductor wafers is
sensitive to economic fluctuations and changes in the market situation can be
sudden and dramatic. The demand for sensor wafers is more stable. The
proliferation of sensors in consumer electronics applications may, however,
increase the susceptibility of this market too to economic fluctuations.
Technology sales comprise mainly crystal sales, which is mainly affected by the
economic situation of the solar cell industry.
Okmetic's share of the global silicon wafer market is around one percent and the
market prices have a notable effect on the price development of Okmetic's
products. The company only has considerable pricing power with its own special
products. The pricing of other wafers is mainly based on global market price.
Okmetic operates globally, and therefore the company's business operations are
affected by risks due to currency fluctuations, consisting of the cash flows of
purchases and sales. A significant part of sales are conducted in US dollars.
The Japanese yen is another notable trading currency. Despite hedging, the
company remains exposed to exchange rate fluctuations.
Great volumes of electricity are used in Okmetic's production. Despite hedging,
the company is also exposed to fluctuations in the price of electricity.
SHARES AND SHAREHOLDERS
On 31 December 2011, Okmetic Oyj's paid-up share capital, as entered in the
Finnish Trade Register, was 11,821,250.00 euro. The share capital is divided
into 17,287,500 shares. The shares have no nominal value attached. Each share
entitles its holder to one vote at general meetings. The company has one class
of shares. The company's shares are included in the Finnish book-entry
securities system.
Major shareholders
on 31 Dec 2011
Shares, Share,
pcs %
Ilmarinen Mutual Pension
Insurance Company 1,666,601 9.6
Mandatum Life Insurance
Company 807,700 4.7
The State Pension Fund 600,000 3.5
Varma Mutual Pension
Insurance Company 477,175 2.8
Veritas Pension
Insurance Company 462,695 2.7
Okmetic Management Oy 400,000 2.3
Etra-Invest Oy Ab 400,000 2.3
Nordea Nordic Small
Cap Fund 370,660 2.1
Okmetic Oyj 297,576 1.7
Aktia Secura Fund 242,146 1.4
Foreign investors and
nominee accounts held by
custodian banks 3,171,183 18.3
Others 8,391,764 48.5
Total 17,287,500 100.0
Shareholders by group
on 31 Dec 2011
Shares, Share,
pcs %
Corporations 2,750,285 15.9
Financial and insurance
institutions 1,685,823 9.8
Public organisations 3,267,327 18.9
Non-profit organisations 151,059 0.9
Households 6,261,823 36.2
Foreign investors and
nominee accounts held by
custodian banks 3,171,183 18.3
Total 17,287,500 100.0
Distribution of shareholdings
on 31 Dec 2011
% of
Shares, Number of % of Shares, share
pcs shareholders shareholders pcs capital
1-100 1,237 16.8 89,714 0.5
101-500 3,363 45.7 991,355 5.7
501-1,000 1,394 18.9 1,147,011 6.6
1,001-5,000 1,142 15.5 2,507,541 14.5
5,001-10,000 122 1.7 897,232 5.2
10,001-50,000 77 1.0 1,633,207 9.4
50,001-100,000 7 0.1 526,459 3.0
100,001-500,000 12 0.2 3,473,439 20.1
500,001- 4 0.1 6,021,542 34.8
Total 7,358 100.0 17,287,500 100.0
SHARE PRICE DEVELOPMENT AND TRADING
A total of 10.9 (14.0) million shares were traded between 1 January and 31
December 2011, representing 63.1 (81.4) percent of the weighted average of share
total of 17.3 (17.2) million during the period. The lowest quotation of the
reporting period was 3.50 (2.98) euro, and the highest 6.65 (5.70) euro, with
the average being 5.48 (4.22) euro. The closing quotation for the period was
4.92 (5.29) euro. At the end of the period, the market capitalisation amounted
to 85.1 (91.5) million euro.
Okmetic is listed on the Small Cap list of NASDAQ OMX Helsinki Ltd. under the
trading code OKM1V. According to the International Classification Benchmark
(ICB), which the exchange uses, Okmetic Oyj is listed under the Technology
Industry. The company website can be found at www.okmetic.com.
OWN SHARES AND DIRECTED SHARE ISSUES
On 16 February 2011, Okmetic's board of directors decided on a transfer of
125,390 own shares, held by the company, as a part of the company's share-based
incentive scheme for the executive management group, of which the company has
given a stock exchange release on 11 February 2010. All the shares were issued
to the members of the executive management group in deviation from the
shareholders' pre-emptive rights (directed share issue). The rewards of the
share reward programme were paid on one hand in Okmetic shares and on the other
hand in a monetary amount covering taxes.
In line with the decisions of the annual general meeting and the board of
directors, Okmetic Oyj transferred 11,711 shares to the board members as payment
of the 2011 annual remuneration on 2 May 2011.
On 18 August 2011, Okmetic Oyj's board of directors announced of its decision to
transfer 9,432 own shares held by the company, for free, to a member of the
executive management group belonging to Okmetic's share-based incentive scheme
2010-2011, as a proportion of reward to be paid as shares on the basis of
earning period 2010.
Okmetic's board of directors decided on 5 August 2011, based on an existing
authorisation of the board of directors, to repurchase a maximum of 280,000
company's own shares. The share repurchase started on 16 August 2011 and ended
on 14 November 2011. An aggregate number of 240,865 shares were repurchased
corresponding to approximately 1.4 percent of the total number of Okmetic shares
and votes. The shares were repurchased with the company's distributable assets
and the repurchase decreased the company's distributable equity by 1,147,375.32
euro. The shares were repurchased in a proportion other than that of the shares
held by the shareholders through public trading on the NASDAQ OMX Helsinki Ltd.
at market price prevailing at the time of repurchase. The average purchase price
per share was 4.76 euro.
The repurchased shares may be used in developing the company's capital
structure, as compensation in possible corporate acquisitions or in other
business arrangements, as part of the company's incentive scheme or transferred
or cancelled in other ways.
At the end of the year, the company held a total of 297,576 shares, which is
approximately 1.7 percent of Okmetic's all shares and votes.
OTHER EVENTS IN THE FINANCIAL YEAR
Okmetic's board of directors approved the company's revised long-term financial
objectives in April. The company's aim is that the organic net sales grow a
minimum of 10 percent annually and that the operating profit is over 10 percent
of the net sales.
The company's previous long-term financial objectives stated that organic net
sales grow a minimum of 6 percent annually and that operating profit is over 10
percent of net sales. At the same time, the company discarded other specifically
defined long-term financial objectives such as a 50 percent equity ratio and
consistent annual dividend distribution.
Based on an existing authorisation of the board of directors, Okmetic's board of
directors decided in November to distribute 0.15 euro per share as additional
dividend (totaling 2,548,488.60 euro). The dividend was paid on 8 December 2011.
Okmetic opened a sales office in Hong Kong that serves the important Asian
market outside Japan in the autumn.
EVENTS AFTER THE END OF THE FINANCIAL YEAR
The company Kiinteistö Oy Piitalot which was part of Okmetic group has merged
with Okmetic Oyj on 1 January 2012. Its assets and liabilities were transferred
to Okmetic Oyj.
The Helsinki Court of Appeal gave a verdict in January in which it decided not
to change the acquittal for President Kai Seikku rendered by the Helsinki
District Court on 20 December 2010 and dismissed the prosecutor's claims on
negligent abuse of insider information. The charge was related to Seikku's
actions while he was still working for his previous employer HKScan Oyj.
MANAGEMENT AND AUDITOR
In 2011, Okmetic's board of directors comprised Henri Österlund as the chairman,
Esa Lager as the vice chairman until 7 April 2011, Tapani Järvinen as the vice
chairman since 7 April 2011, and members of the board Hannu Martola, Mervi
Paulasto-Kröckel since 7 April 2011, and Pekka Salmi.
Kai Seikku acts as the President of Okmetic Oyj and Mikko Montonen, Executive
Vice President, Customers and Markets acts as the Deputy to the President.
In addition to the president, the group's executive management group includes
Mikko Montonen, Executive Vice President, Customers and Markets and Deputy to
the President; Petri Antola, Senior Vice President, Technology Projects; Juha
Jaatinen, Senior Vice President, Finance, IT, and Communications; Jaakko
Montonen, Senior Vice President, Supply Chain; Markku Tilli, Senior Vice
President, Research; Markus Virtanen, Senior Vice President, Human Resources,
Quality, and Environment; and Anna-Riikka Vuorikari-Antikainen, Senior Vice
President, Products.
The company's auditors are PricewaterhouseCoopers Oy, Authorised Public
Accountants, with Mikko Nieminen, Authorised Public Accountant, acting as the
principal auditor.
THE BOARD OF DIRECTORS' PROPOSAL REGARDING DIVIDEND DISTRIBUTION
According to the financial statements dated on 31 December 2011, the parent
company's distributable earnings amount to 26.5 million euro. No significant
changes have taken place in the company's financial position after the end of
the financial year.
The board of directors of Okmetic Oyj proposes to the annual general meeting
that Okmetic Oyj distributes a dividend of 0.28 euro per share for 2011, which,
based on the 17,287,500 shares registered on 8 February 2012, amount to 4.8
million euro.
CONDENSED FINANCIAL STATEMENTS AND TABLES 1 JANUARY - 31 DECEMBER 2011
ACCOUNTING POLICIES
This financial statements release has been prepared in accordance with IAS 34,
Interim Financial Reporting.
In preparing this financial statements release, Okmetic has followed the same
accounting policies as in the financial statements for 2010 except for the
effect of changes required by the adoption of the following new or revised
standards and interpretations as of 1 January 2011:
IAS 24 (revised), Related Party Disclosures
IAS 32 (amendment), Financial Instruments: Presentation - Classification of
Rights Issues
IFRIC 19, Extinguishing Financial Liabilities with Equity Instruments
IFRIC 14 (amendment), Prepayments of a Minimum Funding Requirement
Improvements to IFRSs, May 2010
The adoption of the aforementioned standards and interpretations has not had an
effect on the figures presented from the reporting period.
Okmetic has applied hedge accounting as defined in IAS 39 to the electricity
derivative contracts entered into after 1 April 2011 hedging highly probable
forecast cash flows associated with electricity purchases. The effective portion
of changes in the fair value of derivatives that are designated as cash flow
hedges is recognised in other comprehensive income and presented in hedge
reserve. Such accumulated fair value changes are reclassified to the income
statement in the periods when the hedged cash flow affects profit or loss. The
gain or loss relating to the ineffective portion is recognised immediately in
the income statement within other operating income and expenses.
From the start of 2011 Okmetic has changed the place where changes in fair
values of currency derivative contracts and their realised profits and losses
are presented in the statement of comprehensive income. In line with the new
policy, the changes in the fair values of currency derivative contracts and
their realised profits and losses are presented with the financial income and
expenses. Previously these items were presented with other operating income and
expenses. Okmetic has reported of the change in accounting policies on the
interim report published on 27 April 2011.
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
1,000 euro 1 Oct- 1 Oct- 1 Jan- 1 Jan-
31 Dec, 31 Dec, 31 Dec, 31 Dec,
2011 2010 2011 2010
Net sales 18,134 23,072 83,186 80,907
Cost of sales -13,388 -17,783 -61,876 -62,274
Gross profit 4,746 5,288 21,310 18,633
Other income
and expenses -2,408 -1,849 -9,493 -8,212
Operating
profit 2,338 3,440 11,817 10,421
Financial
income and
expenses 101 -468 -479 -610
Profit before
tax 2,439 2,972 11,339 9,811
Income tax -451 -826 -1,104 141
Profit for
the period 1,988 2,146 10,235 9,952
Other
comprehensive
income:
Cash flow
hedges -144 - -177 -
Translation
differences 469 118 808 624
Other
comprehensive
income for the
period, net of
tax 326 118 631 624
Total
comprehensive
income for
the period 2,313 2,264 10,866 10,576
Profit for the
period
attributable
to:
Equity holders
of the parent
company 1,988 2,146 10,235 9,952
Total
comprehensive
income
attributable
to:
Equity holders
of the parent
company 2,313 2,264 10,866 10,576
Basic earnings
per share,
euro 0.12 0.13 0.61 0.60
Diluted
earnings per
share, euro 0.12 0.12 0.59 0.58
CONDENSED CONSOLIDATED BALANCE SHEET
1,000 euro 31 Dec, 31 Dec,
2011 2010
Assets
Non-current assets
Property, plant and
equipment 34,887 29,069
Other receivables 3,255 2,441
Total non-current assets 38,142 31,510
Current assets
Inventories 13,114 9,987
Receivables 15,374 15,674
Financial assets
at fair value through
profit or loss - 5,004
Cash and cash equivalents 11,257 14,043
Total current assets 39,745 44,708
Total assets 77,887 76,217
Equity and liabilities
Equity
Equity attributable to
equity holders of the
parent company
Share capital 11,821 11,821
Other equity 49,151 46,420
Total equity 60,973 58,242
Liabilities
Non-current liabilities 2,968 1,245
Current liabilities 13,946 16,730
Total liabilities 16,914 17,976
Total equity and
liabilities 77,887 76,217
CONDENSED CONSOLIDATED CASH FLOW STATEMENT
1,000 euro 1 Jan- 1 Jan-
31 Dec, 31 Dec,
2011 2010
Cash flows from operating
activities:
Profit before tax 11,339 9,811
Adjustments 7,575 7,007
Change in working
capital -6,782 210
Financial items -401 -492
Tax paid -39 58
Net cash from
operating activities 11,691 16,594
Cash flows from investing
activities:
Purchases of property,
plant and equipment -11,319 -2,173
Investments in fixed
income funds 5,016 -5,000
Net cash used in
investing activities -6,302 -7,173
Cash flows from financing
activities:
Repayments of
long-term borrowings - -1,500
Payments of finance
lease liabilities - -39
Share issue - 1,200
Repurchase of own shares -1,147 -1,868
Dividends paid -7,331 -834
Net cash used in
financing activities -8,478 -3,041
Increase (+) / decrease
(-) in cash and cash
equivalents -3,089 6,381
Exchange rate changes 304 355
Cash and cash
equivalents at the
beginning of the period 14,043 7,307
Cash and cash
equivalents at the
end of the period 11,257 14,043
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Equity attributable to equity holders of parent company
Share Share Reserve Other Retained Total
capital pre- for in- re- earnings
mium vested serves
1,000 euro unre- 1)
stricted
equity
Balance at
31 Dec, 2010 11,821 20,045 1,200 1,039 24,137 58,242
Profit for
the period 10,235 10,235
Other com-
prehensive
income, net
of tax:
Cash flow
hedges -177 -177
Translation
differences 808 808
Total com-
prehensive
income for
the period 631 10,235 10,866
Repurchase
of own
shares -1,147 -1,147
Share-based
payments 544 544
Dividend
distribution -7,531 -7,531
Balance at
31 Dec 2011 11,821 20,045 1,200 1,670 26,238 60,973
Balance at
31 Dec 2009 11,821 20,045 - 415 16,461 48,742
Profit for
the period 9,952 9,952
Other com-
prehensive
income, net
of tax:
Translation
differences 624 624
Total com-
prehensive
income for
the period 624 9,952 10,576
Share issue 1,200 1,200
Repurchase
of own
shares -1,868 -1,868
Share-based
payments 426 426
Dividend
distribution -834 -834
Balance at
31 Dec 2010 11,821 20,045 1,200 1,039 24,137 58,242
1)"Other reserves" contains hedge reserve and translation differences.
CHANGES IN PROPERTY, PLANT AND EQUIPMENT
1,000 euro 1 Jan- 1 Jan-
31 Dec, 31 Dec,
2011 2010
Carrying amount at the
beginning of the period 29,069 33,174
Additions 11,992 2,232
Disposals - -74
Depreciation -6,252 -6,681
Exchange differences 78 419
Carrying amount at the
end of the period 34,887 29,069
DIVIDENS PAID
In April 2011, the company distributed a dividend of 5.2 million euro of the
profit accrued in 2010 (including the 0.1 million euro dividend paid for Okmetic
Management Oy). The dividend was 0.30 euro per share.
In December 2011, the company distributed an additional dividend of 2.5 million
euro (including the 0.1 million euro dividend paid for Okmetic Management Oy).
The dividend was 0.15 euro per share.
In April 2010, a dividend of 0.8 million euro of the profit accrued in 2009 was
distributed, representing a 0.05 euro dividend per share.
COMMITMENTS AND CONTINGENCIES
1,000 euro 31 Dec, 31 Dec,
2011 2010
Loans, secured with
collaterals 1,000 1,000
Collaterals 8,073 8,073
Off-balance sheet lease
commitments 426 245
Capital commitments 5,424 2,190
Nominal values of
derivative contracts
Currency options, call 652 15,244
Currency options, put 652 18,034
Currency forward
agreements 154 -
Electricity derivatives 2,173 2,038
Fair values of
derivative contracts
Currency options, call 0 184
Currency options, put -81 -595
Currency forward
agreements 1 -
Electricity derivatives -330 544
The contract price of the derivatives has been used as the nominal value of the
underlying asset.
RELATED PARTY TRANSACTIONS
In January-December, the compensation of the executive management group and
board of directors amounted to 2,751,000 (2,815,000) euro. The compensation
include share-based payments and the board of directors' remuneration paid as
shares 1,370,000 (1,275,000) euro.
KEY FIGURES SHOWING FINANCIAL PERFORMANCE
1,000 euro 1 Jan- 1 Jan-
31 Dec, 31 Dec,
2011 2010
Net sales 83,186 80,907
Change in net sales
compared to the previous
year's period, % 2.8 48.8
Export and foreign
operations share
of net sales, % 94.4 95.8
Operating profit before
depreciation (EBITDA) 18,069 17,102
% of net sales 21.7 21.1
Operating profit 11,817 10,421
% of net sales 14.2 12.9
Profit before tax 11,339 9,811
% of net sales 13.6 12.1
Return on equity, % 17.2 18.6
Return on investment, % 18.7 18.2
Non-interest-bearing
liabilities 15,914 16,976
Net interest-bearing
liabilities -10,257 -18,047
Net gearing ratio, % -16.8 -31.0
Equity ratio, % 78.9 76.6
Capital expenditure 11,992 2,232
% of net sales 14.4 2.8
Depreciation 6,252 6,681
Research and development
expenditure 2,382 2,110
% of net sales 2.9 2.6
Average number of
personnel during
the period 363 345
Personnel at the
end of the period 350 342
KEY FIGURES PER SHARE
Euro 31 Dec, 31 Dec,
2011 2010
Basic earnings
per share 0.61 0.60
Diluted earnings
per share 0.59 0.58
Equity per share 3.68 3.49
Dividend per share 0.28 0.45*
Dividends/earnings, % 45.8 75.0
Effective dividend
yield, % 5.7 8.5
Price/earnings (P/E) 8.0 8.9
Share performance (1 Jan-)
Average trading price 5.48 4.22
Lowest trading price 3.50 2.98
Highest trading price 6.65 5.70
Trading price at the
end of the period 4.92 5.29
Market capitalisation
at the end of the
period, 1,000 euro 85,055 91,451
Trading volume (1 Jan-)
Trading volume,
transactions, 1,000 pcs 10,907 14,009
In relation to weighted
average number of
shares, % 63.1 81.4
Trading volume,
1,000 euro 59,650 59,124
The weighted average
number of shares during
the period under review
adjusted by the share
issue, 1,000 pcs 17,288 17,220
The number of shares at
the end of the period
adjusted by the share
issue, 1,000 pcs 17,288 17,288
*The dividend for 2010 includes also the additional dividend of 0.15 euro paid
in December 2011.
When calculating earnings per share (EPS) and equity, Okmetic's own shares in
its possession and Okmetic's shares owned by Okmetic Management Oy are deducted
from the amount of shares.
QUARTERLY KEY FIGURES
1,000 euro 10-12/ 7-9/ 4-6/ 1-3/
2011 2011 2011 2011
Net sales 18,134 21,250 21,747 22,055
Compared to previous
quarter, % -14.7 -2.3 -1.4 -4.4
Compared to corresponding
period last year, % -21.4 -1.7 10.5 33.5
Operating profit 2,338 4,045 2,606 2,828
% of net sales 12.9 19.0 12.0 12.8
Profit before tax 2,439 4,117 2,487 2,296
% of net sales 13.4 19.4 11.4 10.4
Net cash flow generated
from:
Operating activities 5,431 2,094 5,503 -1,337
Investing activities -4,332 -1,100 1,035 -1,905
Financing activities -2,771 -664 -5,043 -
Increase/decrease in cash
and cash equivalents -1,672 330 1,495 -3,243
Personnel at the end
of the period 350 350 389 351
1,000 euro 10-12/ 7-9/ 4-6/ 1-3/
2010 2010 2010 2010
Net sales 23,072 21,626 19,688 16,521
Compared to previous
quarter, % 6.7 9.8 19.2 19.6
Compared to corresponding
period last year, % 67.0 77.7 45.4 11.3
Operating profit 3,440 3,712 2,481 788
% of net sales 14.9 17.2 12.6 4.8
Profit before tax 2,972 2,934 2,987 918
% of net sales 12.9 13.6 15.2 5.6
Net cash flow generated
from:
Operating activities 6,730 5,573 1,874 2,417
Investing activities -6,536 -547 -66 -23
Financing activities -3 -5 -2,406 -627
Increase/decrease in cash
and cash equivalents 191 5,021 -599 1,767
Personnel at the end
of the period 342 340 373 329
DEFINITIONS OF KEY FINANCIAL FIGURES
Operating profit before depreciation = Operating profit + depreciation
(EBITDA)
Return on equity (ROE), % = Profit/loss for the period from
continuing operations x 100/
------------------------------------------
Equity(Average for the period)
Return on investment (ROI), % = (Profit/loss before tax + interest and
other financial expenses) x 100/
------------------------------------------
Balance sheet total - non-interest
bearing liabilities(average for the
period)
Equity ratio, % = Equity x 100/
------------------------------------------
Balance sheet total - advances received
Net interest-bearing liabilities = Interest-bearing liabilities - cash and
cash equivalents
Net gearing ratio, % = (Interest-bearing liabilities - cash and cash equivalents) x 100/
------------------------------------------
Equity
Earnings per share = Profit/loss for the period attributable
to equity holders of the parent company/
------------------------------------------
Adjusted weighted average number of
shares in issue during the period
Equity per share = Equity attributable to equity holders of
the parent company/
------------------------------------------
Adjusted number of shares at the end of
the period
Dividend per share = Dividend for the period/
------------------------------------------
Adjusted number of shares at the end of
the period
Effective dividend yield, % = Dividend per share x 100/
------------------------------------------
Trading price at the end of the period
Price/earnings ratio (P/E) = Last adjusted trading price at the end of
the period/
------------------------------------------
Earnings per share
Average trading price = Total traded amount in euro/
------------------------------------------
Adjusted number of shares traded during
the period
Market capitalisation at the end of = Number of shares at the end of the period
the period x trading price at the end of the period
Trading volume = Number of shares traded during the
period/
------------------------------------------
Weighted average number of shares during
the period
All figures of the financial tables are rounded, and consequently the sum of
individual figures can deviate from the presented sum figure.
The future estimates and forecasts in this financial statements release are
based on company management's current knowledge. Actual events and results may
differ from the estimates presented here.
PRESS CONFERENCE
A press conference for the media and analysts will be held on Wednesday, 8
February 2012 at 1.00 p.m. at Helsinki World Trade Center, Aleksanterinkatu 17,
second floor, Helsinki. In the conference, Okmetic's President Kai Seikku will
present the group's development in 2011 and prospects for 2012.
We ask participants to kindly give advance notice of their attendance by email
to communications@okmetic.com or by telephone to +358 9 5028 0406/Marika
Mäntymaa.
FINANCIAL RELEASES IN 2012
Interim report 1-3/2012 (1Q) 27 April 2012
Interim report 1-6/2012 (2Q) 26 July 2012
Interim report 1-9/2012 (3Q) 24 October 2012
OKMETIC OYJ
Board of directors
For further information, please contact:
President Kai Seikku, Okmetic Oyj,
tel. +358 400 200 288, email: kai.seikku@okmetic.com
Senior Vice President, Finance, IT, and Communications
Juha Jaatinen, Okmetic Oyj, tel. +358 9 5028 0286,
email: juha.jaatinen@okmetic.com
Distribution:
NASDAQ OMX Helsinki
Principal media
www.okmetic.com
OKMETIC IN BRIEF
Take it higher
Okmetic is a technology company which supplies tailor-made silicon wafers for
sensor and semiconductor industries and sells its technological expertise to the
solar cell industry. Okmetic provides its customers with solutions that boost
their competitiveness and profitability.
Okmetic's silicon wafers are part of a further processing chain that produces
end products that improve human interaction and quality of life. Okmetic's
products are based on high-tech expertise that generates added value for
customers, innovative product development and an extremely efficient production
process.
Okmetic has a global customer base and sales network, production plants in
Finland and the US and contract manufacturers in Japan and China. Okmetic's
shares are listed on NASDAQ OMX Helsinki under the code OKM1V. For more
information on the company, please visit our website at www.okmetic.com.
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