2011-02-10 11:19:06 CET
2011-02-10 11:20:05 CET
REGULATED INFORMATION
Metsäliitto Osuuskunta - Financial Statement Release
Metsäliitto Group Financial Statements Bulletin 2010
Metsäliitto Group Financial Statements Bulletin 2010, Stock Exchange Release 10
February 2011 at 12.00 (noon)
Metsäliitto Group's full-year operating result excluding non-recurring items
EUR 547 million in 2010
Operating result excluding non-recurring items EUR 142 million in
October-December
Result for 2010
-- Sales EUR 5,377 million (2009: EUR 4,837 million).
-- Operating result excluding non-recurring items was EUR 547 million (-75).
Operating result including non-recurring items was EUR 497 million (-169).
-- Result before tax excluding non-recurring items was EUR 411 million (-224).
Result before tax including non-recurring items was EUR 345 million (-329).
Result for October-December 2010
-- Sales EUR 1,391 million (10-12/2009: EUR 1,190 million).
-- Operating result excluding non-recurring items was EUR 142 million (44).
Operating result including non-recurring items was EUR 82 million (18).
-- Result before tax excluding non-recurring items was EUR 112 million (8).
Result before tax including non-recurring items was EUR 52 million (-18).
Events in the fourth quarter of 2010
-- Metsä Tissue started a EUR 30 million investment programme at the mill in
Düren, Germany, and announced that it will invest EUR 7 million in
increasing the processing capacity of the Mänttä paper mill.
-- M-real announced that it will invest EUR 26 million in expanding the
folding boxboard and sheeting capacity of the Simpele mill and EUR 16
million in modernising the coating section of the Kemiart Liners mill.
-- Metsäliitto Cooperative signed a new EUR 425 million credit facility. The
loan replaced the EUR 560 million facility that was maturing in March 2011.
-- Metsä-Botnia's Äänekoski, Joutseno and Rauma mills set new annual
production records. The previous records were from 2006 and 2007."Our result for 2010 was strong. We were able to make use of the improved
market conditions and systematically proceed with our internal development
programme. The restructuring and focusing on our strengths underway since 2005
have proven to be the right choice. Metsäliitto Group is well set for the
future."
Kari Jordan, President & CEO, Metsäliitto Group
Metsäliitto Group
Metsäliitto Group
Income statement 2010 2009 2010 2009 2008
(Continuing operations) 1-12 1-12 Q4 Q4 1-12
--------------------------------------------------------------------------
Sales 5 377 4 837 1 391 1 190 6 434
--------------------------------------------------------------------------
Other operating income 142 353 44 237 239
--------------------------------------------------------------------------
Operating expenses -4 686 -4 858 -1 225 -1 185 -6 189
--------------------------------------------------------------------------
Depreciation and impairment losses -336 -501 -129 -224 -482
--------------------------------------------------------------------------
Operating result 497 -169 82 18 2
--------------------------------------------------------------------------
Share of results in associates -15 -16 -1 -4 6
--------------------------------------------------------------------------
Exchange gains and losses -7 2 -1 2 19
--------------------------------------------------------------------------
Other net financial items -129 -147 -27 -34 -260
--------------------------------------------------------------------------
Result before income tax 345 -329 52 -18 -233
--------------------------------------------------------------------------
Income taxes -131 10 -29 -9 60
--------------------------------------------------------------------------
Result from continuing operations 214 -318 23 -27 -172
--------------------------------------------------------------------------
Metsäliitto Group
Profitability 2010 2009 2010 2009 2008
(Continuing operations) 1-12 1-12 Q4 Q4 1-12
--------------------------------------------------------------------------------
Operating result, EUR mill. 497 -169 82 18 2
--------------------------------------------------------------------------------
-- “ --, excluding non-recurring items 547 -75 142 44 45
--------------------------------------------------------------------------------
-- “ -- % of sales 10.2 -1.6 10.2 3.7 0.7
--------------------------------------------------------------------------------
Return on capital employed, % 11.8 -3.3 8.0 1.2 0.5
--------------------------------------------------------------------------------
-- ” --, excluding non-recurring items 13.4 -1.4 13.9 3.7 1.3
--------------------------------------------------------------------------------
Return on equity, % 13.9 -20.0 5.7 -8.0 -8.4
--------------------------------------------------------------------------------
-- ” --, excluding non-recurring items 18.2 -13.4 20.2 -0.3 -6.4
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Financial position 2010 2009 2010 2009 2008
31.12 31.12. 30.9 30.9. 31.12.
--------------------------------------------------------------------------------
Equity ratio, % 29.7 24.5 28.1 23.9 26.0
--------------------------------------------------------------------------------
Net gearing ratio, % 116 157 123 180 149
--------------------------------------------------------------------------------
Interest-bearing net liabilities, EUR mill. 1 939 2 203 1 985 2 363 2 666
--------------------------------------------------------------------------------
Business segments
Sales and Operating Wood Wood Pulp Board and Tissue and Cooking
result Supply Product Industr Paper Papers
January-December 2010 s y Industry
(EUR mill.) Industr
y
--------------------------------------------------------------------------------
Sales 1 353 902 1 365 2 605 938
--------------------------------------------------------------------------------
Other operating 14 17 22 108 10
income
--------------------------------------------------------------------------------
Operating expenses -1 342 -851 -943 -2 401 -854
--------------------------------------------------------------------------------
Depreciation & -4 -45 -63 -166 -44
impairment
losses
--------------------------------------------------------------------------------
Operating result 21 23 381 146 50
--------------------------------------------------------------------------------
Non-recurring items 0 5 -2 27 9
--------------------------------------------------------------------------------
Operating result 21 28 379 173 59
excl. non-recurring
items
--------------------------------------------------------------------------------
This Financial Statements Bulletin is unaudited
METSÄLIITTO GROUP
FINANCIAL STATEMENTS 2010
Sales and result
Metsäliitto Group's sales for 2010 totalled EUR 5,377 million (2009: EUR 4,837
million). The figures for the comparison period include, among others,
Metsä-Botnia's business in Uruguay until 4 December 2009 and Metsäliitto's
holding in Vapo Oy until
24 June 2009. Taking into account the divestments mentioned above and the
change in the consolidation method of Metsä-Botnia effective from 8 December
2009, the growth in Metsäliitto Group's comparable sales was approximately 20
per cent.
The operating result excluding non-recurring items was EUR 547 million (-75).
Non-recurring items totalled EUR -50 million (-94) net, of which income
accounted for EUR 58 million (203) and expenses for EUR 108 million (297).
The most significant items in the non-recurring income, totalling EUR 42
million, were associated with reversals of impairment of fixed assets and
reductions of cost provisions. Non-recurring capital gains totalled EUR 14
million and other income
EUR 2 million.
The most significant non-recurring expenses, totalling EUR 70 million, were
associated with impairment and write-downs of fixed assets and goodwill. Cost
provisions related to restructuring of operations amounted to EUR 33 million.
Other non-recurring expenses totalled EUR 5 million.
Metsäliitto Group's operating result including non-recurring items was EUR 497
million (-169).
Financial income amounted to EUR 5 million (26) and financial costs to EUR 135
million (173). Net exchange gains/losses recognised in financial items were EUR
-7 million (2). The US dollar strengthened on average 5 per cent against the
euro during the year, while the British pound strengthened by 4 per cent and
the Swedish krona by 10 per cent year-over-year. The strengthening of the US
dollar and British pound has improved the price level of forest industry
products and the Group's competitive position.
The share of results in associated companies amounted to EUR -15 million (-16).
The results include a EUR 16 million non-recurring impairment loss related to
M-real's holding in Myllykoski Paper Oy. The figure for the comparison period
includes a EUR 11 million non-recurring expense item related to the divestment
of Myllykoski Paper's Sunila shares.
The result for the period before tax was EUR 345 million (-329), while taxes,
including changes in deferred tax liabilities, totalled EUR -131 million (10).
The result for continuing operations was EUR 214 million (-318), the result for
discontinued operations was EUR 0 million (-23) and the result for the
financial period was EUR 214 million (-342).
The Group's return on capital employed for continuing operations was 11.8 per
cent (-3.3), and the return on equity was 13.9 per cent (-20.0). Excluding
non-recurring items, the return on capital employed was 13.4 per cent (-1.4)
and return on equity was 18.2 per cent (-13.4).
Sales and result for October-December
Metsäliitto Group's sales for the fourth quarter were EUR 1,391 million
(Q3/2010: EUR 1,345 million). The operating result excluding non-recurring
items was EUR
142 million (155). The operating result including non-recurring items was EUR
82 million (170). The decrease in the operating profit compared to the previous
quarter was mainly due to seasonal factors.
Net non-recurring items in October-December totalled EUR -60 million. The most
significant non-recurring items were:
-- EUR -54 million impairment of fixed assets in Board and Paper Industry
-- EUR 9 million reversal of impairment of fixed assets in Board and Paper
Industry
-- EUR -9 million impairment of goodwill and fixed assets in Wood Products
Industry
-- EUR -6 million of other net non-recurring items
The impairment charges will reduce Metsäliitto Group's annual depreciation by a
total of approximately EUR 5 million starting from 2011.
Balance sheet and financing
Metsäliitto Group's total liquidity was EUR 1,054 million (1,357) at the end of
December. Of this, EUR 440 million (558) was in liquid assets and investments,
and EUR 614 million (799) was in off-balance-sheet binding credit facilities.
In addition, the Group can satisfy short-term financial needs with non-binding
commercial paper schemes in Finland and abroad, as well as with credit limits
amounting to approximately EUR 0.5 billion.
In January 2010, M-real decided to exercise its right to early redeem part of
its bond maturing on 15 December 2010. The outstanding nominal amount before
the redemption was approximately EUR 340 million. The total par value of
redemption was EUR 250 million.
Several financing arrangements were implemented in the summer and autumn.
M-real drew pension loans worth EUR 135 million and redeemed the remaining EUR
90 million of the bond referred to above. In December, M-real drew more pension
loans worth EUR 31 million. In the summer, Metsäliitto Cooperative drew pension
loans (TyEL) worth EUR 65 million and redeemed its EUR 150 million bond. In
September Metsäliitto also drew investment loans from pension companies worth
EUR 175 million with five years' maturity. Metsä-Botnia amortised its loans
with approximately EUR 160 million during the year.
Standard & Poor's upgraded M-real's credit rating in August and Moody's
Investor Service in September. The upgrades have a total positive impact of
approximately EUR 2 million on M-real's annual financing costs.
In December, Metsäliitto Cooperative signed a EUR 425 million term loan and
revolving credit facility agreement with a syndicate of seven banks. The new
facility matures in April 2014, and it replaces the EUR 560 million facility
maturing in March 2011. The loan arrangement clearly extended the average
maturity of the loans.
The Group's equity ratio was 29.7 per cent at year's end and net gearing
totalled 116 per cent (24.5% and 157%, respectively). Interest-bearing net
liabilities stood at EUR 1,939 million (2,203). The equity ratio of the parent
company, Metsäliitto Cooperative, was 58.6 per cent at the end of December and
the net gearing ratio was 45 per cent (57.2% and 50%, respectively).
Members' capital in Metsäliitto Cooperative increased by a total of EUR 51.9
million during the year. The actual members' capital increased by EUR 5.8
million and the additional capital A by EUR 8.2 million. The additional
members' capital B increased by EUR 23.4 million and the additional members'
capital C by EUR 14.5 million. According to the notifications received by the
end of 2010, EUR 21.8 (58.2) million of the additional members' capital will
fall due for refund on 1 July 2011. At the end of December, Metsäliitto
Cooperative had 126,382 (127,158) members.
The change in the fair value of investments available for sale was
approximately EUR 30 million (-103) in 2010 based mainly on the increase in the
value of the Pohjolan Voima shares. The change in the fair value of the shares
mainly relates to the change of the 12-month moving average value of Nord Pool
electricity futures used in the valuation.
Capital programme
Metsäliitto Cooperative announced in January that it will launch a capital
programme with the purpose of strengthening its equity to correspond to the
company's current and future business structure. The assets to be accrued will
be mainly used for financing new business operations.
In the context of the programme, Metsäliitto issued in February a new
additional members' capital C, which offers owners the opportunity to gain
additional cash-settled return, in addition to getting interest on members'
capital. The amount of additional return depends on the price development of
M-real Corporation's B share on the Helsinki Stock Exchange.
The subscription period for additional members' capital C ended on 31 December
2010. Of the issued 30 million members' capital C shares approximately 14.5
million were subscribed.
Personnel
The Group had an average of 13,168 employees (14,534) in 2010. At the end of
December, the head count was 12,820 (13,592). The parent company, Metsäliitto
Cooperative, had 2,495 employees at the end of December (2,248).
From the beginning of 2010, the Group has been reporting the number of
personnel as FTE (Full Time Equivalent). Previously, the NOE (Number of
Employees) indicated the number of people employed by the Group, but FTE
measures presence and indicates the number of personnel attending work.
Reference figures have been converted to correspond to the new practice.
Investments
Metsäliitto Group's capital expenditure totalled EUR 138 million (152) in 2010.
Company and share acquisitions amounted to EUR 21 million (496).
In February 2010, Metsä-Botnia's Board of Directors decided on the construction
of new causticisation and water stations at the Kemi mill. The total value of
the investment is approximately EUR 40 million, and the new stations will come
online at the end of the year.
The modernisation of Metsä Tissue's paper machine 10 at the Mänttä mill was
completed in April. The investment, worth some EUR 6 million, is expected to
improve product quality, reduce water consumption and decrease the need for
energy.
In July, M-real exercised its option to purchase the former Kangas paper mill
real estate and land area from Sappi for the price of EUR 13 million. The deal
was part of an agreement with which M-real and Sappi settled the issues still
open related to the sale of M-real's Graphic Papers business area in 2008. In
September, the city of Jyväskylä decided to use its right of pre-emption based
on law to purchase the Kangas mill real estate from M-real for an equivalent
price of EUR 13 million.
In October, Metsä Tissue announced its decision to increase the Away-from-Home
capacity at the Mänttä mill. The value of the investment is EUR 7 million and
the project is scheduled for completion by the first quarter of 2012.
In October, M-real announced that it will invest EUR 26 million in the Simpele
mill to increase its annual folding boxboard capacity by about 80,000 tonnes.
The sheeting capacity will also be expanded at the same time. M-real also
announced that it will invest in the modernisation of the coating section at
the Kemiart Liners mill. The total value of the investment is approximately EUR
16 million. Both investments will be carried out during this year.
In October, M-real and Metsä Tissue signed an agreement on the partial
divestment of M-real's Reflex mill to Metsä Tissue for approximately EUR 10
million. The agreement covered paper machine 5 and related real estate, as well
as certain infrastructure assets. Metsä Tissue will convert the paper machine
to produce cooking papers.
In November, Metsä Tissue announced that it will start an investment programme
of almost EUR 30 million at the Düren mill in Germany. The mill specialises in
producing SAGA-branded baking and cooking papers.
Enhancing operations
Metsäliitto Wood Supply's new organisation was effective from the beginning of
the year. Wood Supply is organised into four business lines: Wood Supply
Finland, International Wood Supply, Wood Energy and Forestry Services.
The sale of Wood Product Industry's blockboard mill in Romania to the Romanian
subsidiaries of Holzindustrie Schweighofer was completed in February.
Metsä Tissue announced a development plan for Polish operations in May. The
plan aims to strengthen the company's position on the Polish market, increase
production capacity, and to further enhance the product, brand and service
offering. Polish paper production will be consolidated at the Krapkowice mill,
and papermaking at the Konstancin-Jeziorna mill will be shut down by the end of
2012.
Under a deal signed in June, Metsä-Botnia sold some of the old machinery of the
Kaskinen pulp mill, which was shut down in March 2009, to an Asian buyer. The
dismantling of the machinery included in the deal was started in August.
In July, M-real announced the permanent closure of the Alizay pulp mill in
France because it had not found the required economic prerequisites to continue
operations.
In July, Metsäliitto's Wood Products Industry signed an agreement on the
divestment of the machinery and equipment of the Soinlahti sawmill, located in
Iisalmi, Finland, to Anaika Wood Ltd Oy. The agreement also included a
long-term wood supply agreement between Metsäliitto Wood Supply and Anaika
Wood. The buildings and land area belonging to the sawmill site were sold to
Iisalmen Teollisuuskylä Oy. Metsäliitto shut down the sawmill at the beginning
of 2009.
In September, M-real announced that in order to improve its profitability, the
company was planning to transfer the Simpele speciality paper production to the
Gohrsmühle mill in Germany and to close the Simpele paper machine. The paper
machine was shut down at the end of 2010.
In August, Metsä Tissue announced that production on PM7 will continue at the
Mänttä mill, but otherwise the entire production of Baking & Cooking products
and all converting will be transferred to Germany. It was decided to shut down
the Mänttä mill's older machine, PM5, by the summer 2011. The statutory labour
negotiations resulted in a headcount reduction of 117 in Mänttä.
Business areas
Wood Supply
Wood Supply sales totalled EUR 1,353 million (1,101) in 2010 and operating
profit amounted to EUR 21 million (-9). Wood Supply Finland accounted for EUR
925 million (828) of the sales and EUR 10 million (-14) of the operating
result. The operating result does not include material non-recurring items
(-21). The most significant reason for the increase in sales and operating
profit compared to the previous year was the increase in delivery volumes.
Wood trade picked up in May after a slow start to the year. The rapid growth in
wood supply caused by late-summer storms in Central and Eastern Finland
resulted in trade also picking up in the rest of the country. Metsäliitto
transferred a large share of its harvesting fleet to areas affected by storm
damage. The majority of the sites acquired by Metsäliitto were harvested during
the autumn. Towards the end of the year, especially those who were willing to
take advantage of the 25 per cent tax relief that ended at the turn of the year
offered wood for sale.
Metsäliitto Wood Supply supplied approximately 29 million cubic metres (24) of
wood to its customers. Metsäliitto purchased more than 14 million cubic metres
of wood (9) from Finnish private forests. Metsäliitto imported mainly deciduous
pulpwood and wood chips from Russia, totalling 1.5 million cubic metres (1.1).
Metsäliitto Wood Supply's new organisation was effective from the beginning of
the year: Wood Supply Finland, International Wood Supply, Wood Energy, and
Forestry Services. Metsäliitto established a solid position as a supplier of
wood energy during the year under review with approximately 60 delivery
destinations across Finland. A total of 2.1 million cubic metres of by-products
from Metsäliitto Group's production plants and forest energy was delivered to
them.
Metsäliitto developed its member services by introducing the Metsäkori service
portfolio, offering all of Metsäliitto's services from the initial phases of
forest ownership to generational change. An individual forest management plan
was introduced as a completely new service.
Wood Products Industry
Wood Products Industry's sales totalled EUR 902 million (806), and the
operating result excluding non-recurring items was EUR 28 million (-41).
Operating result including non-recurring items was EUR 23 million (-47).
Wood Products Industry's market situation improved during the year. The
construction market picked up in the spring, especially in the Nordic countries
and Germany, which boosted the demand for Kertopuu and other products for the
construction customer segment. Due to seasonal factors, demand slowed down
towards the end of the year. With the exception of Germany, construction
volumes remained low in Central Europe, and in the United Kingdom in particular
the government's cost-saving measures and the generally low level of
construction activity had a negative impact on demand.
The price of sawn timber began to increase in the first half of the year, even
though demand remained relatively low throughout the year. The demand for sawn
timber began to level off towards the end of the year, and in November, Wood
Products Industry announced that it will curtail its operations at all sawmills
due to oversupply and slack demand.
The transport equipment industry market picked up during the third quarter,
which had a positive impact on the demand for birch plywood. The demand for
special products for the joinery industry and tailored components continued to
be good.
In consumer and retail trade, overall sales remained at the same low level as
in 2009. With regard to the market areas, sales were low in the United Kingdom
in particular. Instead of seeking growth, retail trade focused on improving
profitability.
The implemented internal streamlining measures contributed to the improved
performance development of Wood Products Industry. Cost saving measures will
also continue during 2011.
Pulp
Metsä-Botnia's sales were EUR 1,365 million (886) and the operating result was
EUR 382 million (-107). The operating result includes EUR 2 million (-77) of
non-recurring income items. The considerable improvement in sales and operating
result compared with the previous year came about from the market picking up
and the pulp price rising steeply.
Metsä-Botnia's pulp production volume was 2,173,000 tonnes (1,959,000) and
total deliveries amounted to 2,176,000 tonnes (2,058,000).
Supply and demand were in balance in 2010. During the first two quarters,
supply of pulp was restricted by a shortage of wood in Indonesia and the
southern states of the United States. A fierce earthquake in Chile stopped
Chile's pulp industry almost completely for a few months.
The pulp price reached a peak level in June, USD 980 per tonne for softwood
pulp and USD 920 for hardwood pulp, while the respective prices were USD 860
and USD 760 at the beginning of the year. Prices decreased slightly during the
autumn. In December, softwood pulp was selling for USD 950 and hardwood pulp
for USD 850.
Pulp Industry (Metsä-Botnia) has been consolidated in the financial statements
of Metsäliitto Group as a subsidiary from 8 December 2009 onwards. Before that,
53 per cent of Metsä-Botnia had been consolidated using the proportional
consolidation method (M-real 30% and Metsäliitto 23%).
Metsä-Botnia has treated its business operations in Uruguay as discontinued
operations in accordance with the IFRS 5 standard. Thus, the business
operations in Uruguay are not included in the sales and result figures
presented above.
Board and Paper
The sales of Board and Paper totalled EUR 2,605 million (2,432), and the
operating result excluding non-recurring items was EUR 173 million (-150).
Comparable sales grew by approximately 19 per cent.
The net amount of non-recurring items recognised in the operating profit was
EUR -27 million (-117). Impairment losses and various cost provisions
recognised amounted to EUR 70 million and reversals of impairment of fixed
assets and cost provisions as well as sales gains amounted to EUR 43 million.
The operating result was improved by price increases in board and paper,
increase in delivery volumes, cost savings and the higher price of pulp. The
strengthening of the Swedish krona against the euro, the investment shutdown at
Husum and the stevedore strike in Finland weakened the result. The operating
result includes a sales gain of EUR 8 million from the sale of the Sappi
shares, which is recognised as other business income.
Operating result including non-recurring items was EUR 146 million (-267). Net
interest and other financial expenses totalled EUR 65 million (80), income from
associated companies was EUR -24 million (-16) and net exchange gains and
losses booked as financial items were EUR -9 million (5).
The share of results in associated companies include a EUR 16 million
non-recurring impairment loss related to M-real's holding in Myllykoski Paper
Oy. The figure for the comparison period includes a EUR 11 million
non-recurring expense item related to the divestment of Myllykoski Paper's
Sunila shares.
The result for the financial period before tax was EUR 48 million (-358),
earnings per share from continuing operations were EUR 0.09 (-1.02) and return
on capital employed was 5.7 per cent (-8.9). Excluding non-recurring items, the
result before tax was EUR 92 million (-230), earnings per share were EUR 0.23
(-0.66) and the return on capital employed was 7.6 per cent (-4.5).
At the end of December, M-real's equity ratio was 32.1 per cent and net gearing
amounted to 83 per cent (29.6% and 84%, respectively). Some of M-real's loan
agreements set a 120 per cent limit on the company's net gearing ratio and a 30
per cent limit on the equity ratio. At year end, net gearing calculated as
defined in the loan agreements was approximately 64 per cent and the equity
ratio was about 38 per cent.
Tissue and Cooking Papers
Sales of Metsä Tissue, which produces tissue and cooking papers, totalled EUR
938 million (890), and its operating result was EUR 59 million (93). The
operating result including non-recurring items was EUR 50 million (93). The
increase in sales was attributable to increased sales volumes (+2%) as well as
exchange rate fluctuations and price increases (+3%). Sales of Metsä Tissue's
own brands increased by 9 per cent from the previous year, and in particular,
the demand for Lambi, Katrin and Serla developed positively.
Steeply rising raw material costs, among others, had a negative impact on the
operating profit. Pulp prices were 40 per cent higher on average, and the price
of recycled paper was up to double the level of the previous year in Central
and Eastern Europe. In addition, the exceptional weather conditions and the
stevedore strike in Finland and paper workers' strike in Sweden impeded
operations.
Write-downs and cost provisions amounting to EUR 7 million relating to the
development project in Poland and EUR 2 million relating to the restructuring
at the Mänttä mill were recognised in non-recurring items.
During the year under review, Metsä Tissue announced two strategic development
programmes. The company acquired paper machine 5 and related assets from
M-real's Düren mill in Germany. With production and converting closer to the
main markets, the availability of the products will improve and the synergy
benefits of the existing mill and distribution network in Germany can be
utilised. The deal also makes it possible to develop new products and product
groups as well as grow in the baking and cooking paper business.
The second development programme relates to the streamlining and strengthening
of the Polish operations. Metsä Tissue aims to improve the quality of the
products and the offering of services in Poland.
Two napkin machines were introduced at the Pauliström mill in Sweden, improving
the reliability of deliveries with the lines located in Germany. The
rebuilding of paper machine 10 at the Mänttä mill was completed during the
spring. The investment improved the quality of Lambi, Serla and Katrin products
and increased the mill's energy efficiency. In addition, Metsä Tissue announced
that it will increase the Away-from-Home capacity at the Mänttä mill to support
the growth objectives of the Katrin brand. The project is scheduled for
completion in early 2012.
Management remuneration
The Board of Directors of Metsäliitto Cooperative resolved on a new share-based
incentive plan for the management. The aim of the plan is to combine the
objectives of the shareholders and the executives in order to increase the
value of the Metsäliitto Group, to commit the executives to perform the Group's
mutual strategy, and to offer them a competitive reward plan based on share
ownership.
The plan includes three three-year earning periods: calendar years 2011-2013,
2012-2014 and 2013-2015. The Board of Directors will decide on the earnings
criteria and on targets to be established for them at the beginning of each
earning period. The potential reward from the plan for the earning period
2011-2013 will be based on the Metsäliitto Group´s (M-real´s for persons
working in M-real) equity ratio and the development of return on capital
employed (ROCE) and operating result (EBIT). Each earning period is followed by
a subsequent two-year restriction period during which the participant is not
entitled to transfer or dispose of the shares.
The potential reward from the earning period 2011-2013 will be paid partly in
M-real Corporation's series B shares and partly in cash in 2014. The proportion
paid in cash will cover taxes and tax-related costs arising from the reward.
Initially, the system covers 52 persons, including the members of the Group's
Executive Management Team. The rewards to be paid on the basis of the plan for
the first earning period will correspond to the value of a maximum total of
approximately 4.7 million M-real Corporation series B shares, also including
the proportion to be paid in cash.
Members of the Metsäliitto Group Executive Management Team have established a
company named Metsäliitto Management Oy during the third quarter. Through the
company, the management has invested EUR 3,850,000 of their own funds in
M-real's B shares. In addition, a part of the investments of the company in
M-real's B shares have been financed by a EUR 15,400,000 loan granted by
Metsäliitto Cooperative in August. The management themselves shoulder the
ownership risk for the investment they make in the system. The purpose of the
system is to encourage members of the Executive Management Team to acquire and
own M-real Corporation's B shares and, through this, to increase the
shareholder value of Metsäliitto Group in the long term and support the
achievement of the Group's strategic objectives.
Metsäliitto Management Oy has been established solely to manage Metsäliitto
Group's share-based incentive scheme. Metsäliitto Cooperative has a contractual
right to exercise control in the company and its decision-making. The income
statement and balance sheet of Metsäliitto Management Oy have been consolidated
in the financial statements of the Group as from the beginning of the
arrangement.
Events after the period
In January, M-real announced the launch of a new profit improvement programme
for 2011. The programme focuses on improving the paper business profitability
as well as decreasing variable costs of all businesses. The earlier announced
profit improvement impact of Simpele and Kemi cartonboard investments and the
closure of the speciality paper production at Simpele are included in the new
profit improvement programme.
The planned measures are expected to improve M-real's annual operating result
by EUR 70 million with full effect from 2012 onwards. The effect on the 2011
result is expected to be approximately EUR 30 million.
In February 2011 Metsä-Botnia decided to develop the energy production and
build a bark gasification plant at its Joutseno mill. The total value of the
investment is approximately EUR 20 million. The plant will compensate the
mill's consumption of natural gas and the mill will be carbon neutral during
normal operation.
M-real is investing EUR 30 million to increase the Äänekoski and Kyröskoksi
mills' annual folding boxboard capacity by a total of approximately 70,000
tonnes. After the investments, the annual production capacity will increase to
190,000 tonnes at Kyröskoski and 240,000 tonnes at Äänekoski. The Kyröskoski
investment will be carried out at the end of 2011 and the Äänekoski investment
during the spring of 2012.
Risks and uncertainties
The estimates and statements in this financial statements bulletin are based on
current plans and estimates. They involve risks and uncertainties that may
cause the results to differ from those expressed in such statements. In the
short term, the price of and demand for end products, raw material costs,
energy prices and the exchange rate development of the euro have an effect on
the results of Metsäliitto Group.
The risks related to the Group's business have been explained more extensively
in Metsäliitto Group's Annual report for 2009.
Near-term outlook
During 2011, use of wood at the Group's productions units is estimated to be at
a normal level. Metsäliitto buys all timber grades from logging sites marked
for summer felling and as delivery sales when delivered to the roadside. In
particular, there is demand for birch and pine pulpwood and birch logs. After
the end of the tax reliefs, wood trade is likely to start quietly.
No significant change is expected in the overall demand for wood products
during the year. The year will be challenging due to the decrease in the
profitability of sawn timber, but financial performance is nevertheless
expected to remain at the level of 2010.
At the beginning of 2011, pulp supply and demand are balanced. Producers' pulp
stocks were at a normal level, and customers' pulp stocks vary between normal
and low. Some previously-closed down pulp mills will reopen during the year,
but no actual new market pulp capacity is expected.
The demand for tissue and cooking papers and brand sales are forecasted to
remain solid. Consumers' increasing environmental awareness and responsible
consumption are a permanent trend. Cost pressures are caused by high pulp and
recycled paper prices, increased energy costs and increasing indirect taxes.
The demand for board is also expected to remain strong within the next few
months. The prices of M-real's folding boxboard and liner in Europe are more
than 10 per cent higher than at the beginning of the previous year, due to the
implemented increased.
The demand for uncoated fine paper is expected to continue unchanged. M-real
has announced in Europe that it will increase the prices of uncoated fine paper
by 6-8 per cent as of March 2011. The demand for speciality papers is expected
to remain stable with unchanged prices.
Signs of a recovery in the economy began to be seen during the third quarter of
2009, and the development continued during 2010. Metsäliitto Group's strongly
positive operating result was attributable to rising prices of almost all
products, higher utilisation rates of the mills due to improved demand and
internal profit improvement measures.
Metsäliitto Group's operating result excluding non-recurring items in the first
quarter of 2011 is expected to be approximately at the same level as in the
previous quarter.
Proposal for interest on members' capital
Metsäliitto Cooperative's Board of Directors has decided to propose to the
Supervisory Board that, for 2010, interest of 5.5 per cent (5.5 for 2009) be
paid for the statutory capital invested by its members. Interest of 5.0% (5.0)
is proposed for additional members' capital A, and interest of 4.5% (4.5) for
additional members' capital B and C.
The proposal of the Board of Directors will be dealt with in March by
Metsäliitto Cooperative's Supervisory Board, which, in turn, will make a
proposal on the interest on members' capital to the Representative Council
meeting in May.
Espoo, 10 February 2011
Metsäliitto Group
Board of Directors
Further information:
Vesa-Pekka Takala, Group CFO, Metsäliitto Group, tel. +358 10 465 4260
Anne-Mari Achrén, Group CCO, Metsäliitto Group, tel. +358 10 465 4541
Unaudited
METSÄLIITTO GROUP
Condensed consolidated statement 2010 2009 Change 2010 2009 2008
of comprehensive income, EUR 1-12 1-12 Q4 Q4 1-12
mill.
--------------------------------------------------------------------------------
Continuing operations
----------------------------------------- -------- ---------------
Sales 5 377 4 837 541 1 391 1 190 6 434
----------------------------------------- -------- ---------------
Other operating income 142 353 -211 44 237 239
----------------------------------------- -------- ---------------
Operating expenses -4 686 -4 858 172 -1 225 -1 185 -6 189
----------------------------------------- -------- ---------------
Depreciation and impairment -336 -501 165 -129 -224 -482
losses
--------------------------------------------------------------------------------
Operating result 497 -169 666 82 18 2
----------------------------------------- -------- ---------------
Share of results in associated -15 -16 0 -1 -4 6
companies
----------------------------------------- -------- ---------------
Exchange gains and losses -7 2 -10 -1 2 19
----------------------------------------- -------- ---------------
Other net financial items -129 -147 17 -27 -34 -260
--------------------------------------------------------------------------------
Result before income tax 345 -329 674 52 -18 -233
----------------------------------------- -------- ---------------
Income taxes -131 10 -141 -29 -9 60
--------------------------------------------------------------------------------
Result for the period 214 -318 533 23 -27 -172
from continuing operations
--------------------------------------------------------------------------------
----------------------------------------- -------- ---------------
Discontinued operations
----------------------------------------- -------- ---------------
Result from discontinued 0 -23 23 0 -9 -338
operations
--------------------------------------------------------------------------------
Result for the period 214 -342 556 23 -36 -511
--------------------------------------------------------------------------------
----------------------------------------- -------- ---------------
Other comprehensive income
----------------------------------------- -------- ---------------
Cash flow hedges 19 35 -15 13 11 -55
----------------------------------------- -------- ---------------
Available for sale financial 30 -103 133 -7 -2 97
assets
----------------------------------------- -------- ---------------
Currency translation differences 25 -15 39 7 10 13
----------------------------------------- -------- ---------------
Other items 0 0 0 0 0 -1
----------------------------------------- -------- ---------------
Income tax relating to -7 23 -30 -1 0 -16
components
of other comprehensive income
--------------------------------------------------------------------------------
Other comprehensive income, net 67 -60 127 12 18 39
of tax
--------------------------------------------------------------------------------
----------------------------------------- -------- ---------------
Total comprehensive income 281 -402 683 36 -18 -472
for the period
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Result attributable to:
--------------------------------------------------------------------------------
Members of parent company 170 -116 286 31 24 -213
--------------------------------------------------------------------------------
Non-controlling interests 44 -226 270 -8 -60 -297
--------------------------------------------------------------------------------
214 -342 556 23 -36 -511
--------------------------------------------------------------------------------
Total comprehensive income
attributable to:
-------------------------------
Members of parent company 204 -150 353 37 28 -199
--------------------------------------------------------------------------------
Non-controlling interests 77 -252 329 -1 -46 -272
--------------------------------------------------------------------------------
281 -402 683 36 -18 -472
--------------------------------------------------------------------------------
Unaudited
Condensed consolidated balance sheet 2010 2009
31.12. 31.12.
----------------------------------------------------------
ASSETS
Non-current
Goodwill 503 493
Other intangible assets 242 245
Tangible assets 2 281 2 428
Biological assets 8 7
Investments in associated companies 80 98
Available for sale investments 338 356
Non-current financial assets 18 12
Deferred tax receivables 63 58
---------------
3 534 3 697
---------------
Current
Inventories 798 669
Accounts receivables and other receivables 892 797
Cash and cash equivalents 440 558
---------------
2 131 2 024
---------------
Assets classified as held for sale 8 9
----------------------------------------------------------
Total assets 5 672 5 730
----------------------------------------------------------
----------------------------------------------------------
MEMBERS' FUNDS AND LIABILITIES
Members' funds
Members' funds 1 154 927
Non-controlling interests 524 471
---------------
1 678 1 399
---------------
Non-current liabilities
Deferred tax liabilities 409 382
Post-employment benefit obligations 115 122
Provisions 48 76
Borrowings 1 927 1 976
Other liabilities 36 134
---------------
2 534 2 689
---------------
Current liabilities
Provisions 19 52
Current borrowings 471 798
Accounts payable and other liabilities 969 787
---------------
1 460 1 637
---------------
Liabilities classified as held for sale 0 6
Total liabilities 3 994 4 331
Total members' funds and liabilities 5 672 5 730
----------------------------------------------------------
Non-current portion of derivative financial instruments have been transferred
to non-current financial assets from accounts receivables and other receivables
(2009: EUR 2 mill.). Non-current portion of derivative financial instruments
have been transferred to other liabilities from accounts payable and other
liabilities (2009: EUR 19 mill.).
Unaudited
Equity attributable to members of parent company
Change in Member Share Trans- Fair Retain Total Non-cont Total
members' funds s' premiu lation value ed rolling
EUR mill. capita m differ and earnin interest
l accoun -- other gs s
t ences reserv
es
--------------------------------------------------------------------------------
Members' funds 585 30 -5 165 329 1 104 682 1 786
1.1.2009
--------------------------------------------------------------------------------
Result for the -116 -116 -226 -342
period
--------------------------------------------------------------------------------
Other
comprehensive
income
Cash flow hedges 17 17 18 35
Available for -53 -53 -50 -103
sale financial
assets
Currency -10 -10 -5 -15
translation
differences
Other items
Income tax 3 10 12 11 23
relating to
components
of other
comprehensive
income
--------------------------------------------------------------------------------
Other -7 -27 0 -34 -26 -60
comprehensive
income total
--------------------------------------------------------------------------------
Total -7 -27 -116 -150 -252 -402
comprehensive
income
Transactions
with owners
Dividends paid -29 -29 -1 -30
Change in -101 -101 -101
members' capital
Change in share
premium account
Transfer from
unrestricted to
restricted
equity
Business 20 82 102 44 146
arrangements
Members' funds 484 30 9 221 184 927 471 1 399
31.12.2009
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Members' funds 484 30 9 221 184 927 471 1 399
1.1.2010
--------------------------------------------------------------------------------
Result for the 170 170 44 214
period
Other
comprehensive
income
Cash flow hedges 11 11 8 19
Available for 12 12 18 30
sale financial
assets
Currency 14 14 10 25
translation
differences
Other items
Income tax 2 -6 -5 -3 -7
relating to
components
of other
comprehensive
income
--------------------------------------------------------------------------------
Other 16 18 0 34 33 67
comprehensive
income total
--------------------------------------------------------------------------------
Total 16 18 170 204 77 281
comprehensive
income
Transactions
with owners
Dividends paid -27 -27 -4 -31
Change in 55 55 55
members' capital
Change in share 1 1 1
premium account
Transfer from 9 -9 0 0
unrestricted to
restricted
equity
Business 1 1 1 2
arrangements
Acquisitions of
non-controlling -6 -6 -22 -28
interests
Members' funds 539 31 25 247 312 1 154 524 1 678
31.12.2010
--------------------------------------------------------------------------------
Unaudited
Condensed consolidated cash flow statement 2010 2009
1-12 1-12
------------------------------------------------------------
Result for the period 214 -342
Total adjustments 495 469
Change in working capital -136 231
------------------------------------------------------------
Cash flow arising from operations 573 359
------------------------------------------------------------
Net financial items -163 -84
Income taxes paid -100 0
------------------------------------------------------------
Net cash flow arising from operating activities 310 275
------------------------------------------------------------
Acquisitions -21 -496
Investments in tangible and -138 -152
intangible assets
Divestments of assets and other 89 940
------------------------------------------------------------
Net cash flow arising from investing activities -70 291
------------------------------------------------------------
Change in members' funds 52 -57
Change in other equity 4
Change in long-term loans -376 -530
and other financial items
Dividends paid -40 -40
------------------------------------------------------------
Net cash flow arising from financing activities -360 -626
------------------------------------------------------------
------------------------------------------------------------
Changes in cash and cash equivalents -120 -60
------------------------------------------------------------
------------------------------------------------------------
Cash and cash equivalents at beginning of period 558 619
Translation difference 3 -1
Changes in cash and cash equivalents -120 -60
Cash and cash equivalents 0 -1
in assets classified as held for sale
Cash and cash equivalents at end of period 440 558
------------------------------------------------------------
Unaudited
BUSINESS SEGMENTS
Wood Supply 1-12/10 1-12/09 Q4/10 Q4/09
------------------------------------------------------------------
Sales 1 353 1 101 365 292
------------------------------------------------------------------
EBITDA 25 -5 5 -16
-- ” --, excl. non-recurring items 25 16 5 5
Depreciation and impairment -4 -4 -1 -1
Operating result 21 -9 4 -17
-- ” --, excl. non-recurring items 21 12 4 4
------------------------------------------------------------------
Capital expenditure 3 2 1 1
------------------------------------------------------------------
Personnel at end of period 1 078 945 1 078 945
------------------------------------------------------------------
Wood Products Industry 1-12/10 1-12/09 Q4/10 Q4/09
------------------------------------------------------------------
Sales 902 806 224 193
------------------------------------------------------------------
EBITDA 67 -2 20 7
-- ” --, excl. non-recurring items 63 -2 21 7
Depreciation and impairment -45 -45 -18 -16
Operating result 23 -47 2 -9
-- ” --, excl. non-recurring items 28 -41 12 -3
------------------------------------------------------------------
Capital expenditure 16 10 4 3
------------------------------------------------------------------
Personnel at end of period 2 677 3 110 2 677 3 110
------------------------------------------------------------------
Pulp Industry 1-12/10 1-12/09 Q4/10 Q4/09
------------------------------------------------------------------
Sales 1 365 1 195 365 297
------------------------------------------------------------------
EBITDA 444 366 115 378
-- ” --, excl. non-recurring items 453 71 116 67
Depreciation and impairment -63 -173 -18 -23
Operating result 381 193 98 355
-- ” --, excl. non-recurring items 379 -43 99 44
------------------------------------------------------------------
Capital expenditure 14 53 6 7
------------------------------------------------------------------
Personnel at end of period 881 1 106 881 1 106
------------------------------------------------------------------
Pulp Industry (Metsä-Botnia) has been consolidated as a subsidiary from 8
December 2009 onwards. Before that, 53% of Metsä-Botnia has been consolidated
using the proportional consolidation method (M-real 30% and Metsäliitto 23%).
Board and Paper Industry 1-12/10 1-12/09 Q4/10 Q4/09
------------------------------------------------------------------
Sales 2 605 2 432 665 606
------------------------------------------------------------------
EBITDA 312 88 74 132
-- ” --, excl. non-recurring items 305 44 71 51
Depreciation and impairment -166 -356 -77 -185
Operating result 146 -267 -4 -52
-- ” --, excl. non-recurring items 173 -150 37 7
------------------------------------------------------------------
Capital expenditure 66 73 18 18
------------------------------------------------------------------
Personnel at end of period 4 538 4 903 4 538 4 903
------------------------------------------------------------------
Unaudited
Tissue and Cooking Papers 1-12/10 1-12/09 Q4/10 Q4/09
------------------------------------------------------------------
Sales 938 890 246 229
------------------------------------------------------------------
EBITDA 94 135 24 31
-- ” --, excl. non-recurring items 99 135 24 31
Depreciation and impairment -44 -42 -10 -11
Operating result 50 93 14 21
-- ” --, excl. non-recurring items 59 93 14 21
------------------------------------------------------------------
Capital expenditure 49 35 31 17
------------------------------------------------------------------
Personnel at end of period 3 198 3 150 3 198 3 150
------------------------------------------------------------------
Other operations 1-12/10 1-12/09 Q4/10 Q4/09
------------------------------------------------------------------
Sales 3 170 1 4
------------------------------------------------------------------
EBITDA -7 69 -1 21
-- ” --, excl. non-recurring items -6 21 -1 0
Depreciation and impairment -2 -11 0 0
Operating result -9 59 -1 20
-- ” --, excl. non-recurring items -7 11 -1 -1
------------------------------------------------------------------
Capital expenditure 23 516 1 493
------------------------------------------------------------------
Personnel at end of period 448 378 448 378
------------------------------------------------------------------
Other operations include Vapo Group (49.9%) until June 24, 2009 and
Metsäliitto's service and holding functions as well as Metsäliitto Management
Oy.
Internal sales 1-12/10 1-12/09 Q4/10 Q4/09
and eliminations
------------------------------------------------------------------
Sales -1 790 -1 758 -475 -431
------------------------------------------------------------------
EBITDA -101 -319 -26 -313
-- ” --, excl. non-recurring items -94 -40 -20 -40
Depreciation and impairment -13 129 -4 12
Operating result -114 -190 -30 -300
-- ” --, excl. non-recurring items -107 45 -24 -27
------------------------------------------------------------------
Metsäliitto Group 1-12/10 1-12/09 Q4/10 Q4/09
--------------------------------------------------------------------
Sales 5 377 4 837 1 391 1 190
--------------------------------------------------------------------
EBITDA 833 332 211 242
-- ” --, excl. non-recurring items 846 246 217 121
Depreciation and impairment -336 -501 -129 -224
Operating result 497 -169 82 18
-- ” --, excl. non-recurring items 547 -75 142 44
--------------------------------------------------------------------
Capital expenditure 159 648 34 533
--------------------------------------------------------------------
Personnel at end of period 12 820 13 592 12 820 13 592
--------------------------------------------------------------------
EBITDA = Operating result before depreciation and impairment losses.
Unaudited
Quarterly data 2010 2010 2010 2010 2009 2009 2009 2009
QIV QIII QII QI QIV QIII QII QI
--------------------------------------------------------------------------------
Sales
-------------- ------
Wood Supply 365 318 337 333 292 232 251 327
-------------- ------
Wood Products Industry 224 231 256 192 193 188 224 202
-------------- ------
Pulp Industry 365 344 368 288 297 313 282 303
-------------- ------
Board and Paper Industry 665 662 676 602 606 618 585 623
-------------- ------
Tissue and Cooking 246 236 231 225 229 226 217 218
Papers
-------------- ------
Other operations 1 1 2 0 4 3 72 92
-------------- ------
Internal sales and -475 -446 -454 -415 -431 -425 -418 -487
eliminations
-------------- ------
Sales total 1 391 1 345 1 416 1 224 1 190 1 155 1 213 1 278
--------------------------------------------------------------------------------
-------------- ------
Operating result
-------------- ------
Wood Supply 4 3 8 7 -17 -1 4 5
-------------- ------
Wood Products Industry 2 11 11 -2 -9 -3 -10 -25
-------------- ------
Pulp Industry 98 114 112 57 355 2 -42 -122
-------------- ------
Board and Paper Industry -4 66 35 49 -52 -24 -73 -117 -------------- ------
Tissue and Cooking 14 11 5 19 21 31 22 19
Papers
-------------- ------
Other operations -1 -3 -2 -2 20 2 27 10
-------------- ------
Eliminations -30 -32 -29 -23 -300 0 16 94
--------------------------------------------------------------------------------
Operating result total 82 170 141 105 18 7 -56 -137
--------------------------------------------------------------------------------
-- % of sales 5.9 12.6 10.0 8.6 1.5 0.6 -4.6 -10.7
-------------- ------
-------------- ------
Share of results in -1 -1 -7 -6 -4 -1 -8 -2
associated companies
-------------- ------
Exchange gains and -1 -6 2 -2 2 4 -1 -2
losses
-------------- ------
Other net financial -27 -35 -34 -34 -34 -63 -30 -20
items
--------------------------------------------------------------------------------
Result before income tax 52 128 102 64 -18 -53 -95 -163
--------------------------------------------------------------------------------
Income tax -29 -39 -40 -24 -9 -6 7 19
--------------------------------------------------------------------------------
Result from continuing 23 89 62 40 -27 -59 -88 -144
operations
--------------------------------------------------------------------------------
-------------- ------
Result from discontinued 0 0 0 0 -9 -2 -3 -10
operations
--------------------------------------------------------------------------------
Result for the period 23 89 62 40 -36 -61 -91 -153
--------------------------------------------------------------------------------
Operating result 2010 2010 2010 2010 2009 2009 2009 2009
excl. non-rec. items QIV QIII QII QI QIV QIII QII QI
----------------------------------------------------------------------------
Wood Supply 4 3 8 7 4 -1 4 5
----------------------------------------------------------------------------
Wood Products Industry 12 5 11 0 -3 -3 -10 -25
------------ -----
Pulp Industry 99 114 110 57 44 2 -42 -47
------------ -----
Board and Paper Industry 37 54 43 39 7 -22 -70 -65
------------ -----
Tissue and Cooking Papers 14 13 12 19 21 31 22 19
------------ -----
Other operations & elim. -24 -34 -31 -25 -28 3 35 46 ------------ -----
Operating result total 142 155 154 96 44 9 -61 -67
----------------------------------------------------------------------------
Acquisitions
Wood Products Industry increased its ownership of Kumpuniemen Voima Oy on 31
November 2010 from 33.33 per cent to 53.97 per cent, gaining control of the
company. Kumpuniemen Voima Oy produces electricity and heat from wood fuel to
Wood Products Industry's Suolahti plywood mill and the municipality of
Suolahti. The previously owned share has been measured at fair value of the
purchasing time and the difference between the book value and fair value of EUR
0.4 million has been recognised in the profit and loss statement in other
operating income. The shares of the owners with no controlling interest have
been measured at a value which corresponds with the interest of the
non-controlling owner's proportional share of the specifiable net assets of the
acquisition.
The subsidiary of Oy Metsä-Botnia Ab acquired the operations of the Italian
agent on 31 August 2010.
The management estimates that the affect of the operations of Kumpuniemen Voima
Oy and the Italian agent on Metsäliitto Group's sales or operating result
during 1 January - 31 December 2010 would have been insignificant if the
acquisitions would have been realised on 1 January 2010.
Acquisitions total 2010
EUR mill. Booked values
---------------------------------------------------------------------
Customer relationships (included in intangible assets) 0
Tangible assets 5
Accounts receivables and other receivables 1
Cash and cash equivalents 1
---------------------------------------------------------------------
Total assets 7
---------------------------------------------------------------------
Deferred tax liabilities 0
Financial liabilities 4
Accounts payable and other liabilities 1
---------------------------------------------------------------------
Total liabilities 5
---------------------------------------------------------------------
Net assets 2
Previously owned share on net assets at fair value 1
Non-controlling interests based on the proportional
share attributable to net liabilities 1
Net assets acquired 1
Acquisition cost 1
Goodwill 0
Cash transaction 1
Liquid funds of subsidiary acquired -1
---------------------------------------------------------------------
Cash flow on acquisition 0
---------------------------------------------------------------------
The fair value of customer relationships has been specified based on the
estimated duration of the customer relationships and discounted net cash flows.
The book values of other items substantially correspond to the fair value.
Unaudited
Change in tangible assets 2010 2009
-------------------------------------------------------
Book value at beginning of period 2 428 2 958
-------------------------------------------------------
Business acquisitions 5 472
Investments 135 143
Decrease -23 -772
Assets classified as held for sale -6 -3
Depreciation and impairment charges -314 -449
Translation differences and other changes 56 78
-------------------------------------------------------
Book value at end of period 2 281 2 428
-------------------------------------------------------
In 2010, assets classified as held for sale include a part of the old equipment
of the Metsä-Botnia's Kaskinen pulp mill shut down in 2009 and the tangible
assets of the Wood Products Industry's blockboard mill in Romania in 2009.
Depreciation and impairment charges include a EUR 5 million impairment of
goodwill in the Building Products business line based on impairment testing.
Moreover, an impairment of EUR 4 million was booked in Wood Products Industry's
Karihaara saw mill.
Depreciation and impairment charges also include the partial cancellation of an
impairment loss of EUR 8 million based on the agreed transaction of the paper
machine booked in connection with the closing of M-real's Kangas mill's PM 2,
and the previously booked M-real's Zanders' Reflex mill's machines' EUR 3
million cancellation of the impairment loss based on the mills partial sale to
Metsä Tissue. Further, the depreciation and impairment charges include a EUR 9
million impairment cancellation in M-real's Office Paper business area and an
impairment of EUR 28 million in M-real's Speciality Papers business area based
on impairment testing. In addition, EUR 15 million impairment was booked in
M-real's Market Pulp and Energy business area's Hallein mill as an additional
depreciation in connection with buildings no longer used in production, and an
impairment of EUR 11 million in M-real's Consumer Packaging business area in
connection with the closing of Simpele's paper machine.
Depreciation and impairment charges also include the partial cancellation of an
impairment of EUR 11 million in connection with the closing of Metsä-Botnia's
Kaskinen mill based on an agreed property sale and a depreciation of EUR 4
million connected with the rearrangements of Metsä Tissue's operations in
Poland.
Commitments 2010 2009
-----------------------------------------------------
On own behalf (incl. leasing liabilities) 698 456
-----------------------------------------------------
On behalf of associated companies 4 6
On behalf of others 4 4
Total 706 466
-----------------------------------------------------
Open derivative contracts 2010 2009
---------------------------------------
Interest rate derivatives 1 003 831
---------------------------------------
Currency derivatives 1 660 1 766
Other derivatives 127 254
Total 2 790 2 850
---------------------------------------
The market value of open derivative contracts at the end of the review period
was EUR -20 million (2009: EUR -28 million). Open derivative contracts also
include closed contracts to a total amount of EUR 522 million (2009: EUR 537
million).
Accounting policies
This Financial Statements Bulletin was prepared in accordance with the IAS 34
standard Interim Financial Reporting and the accounting policies presented in
Metsäliitto Group's Annual Report 2009.
Calculation of
key ratios
Return on = (Result from continuing operations before tax + interest
capital expenses, net exchange gains/losses and other financial
employed (%) expenses) per
(Balance total - non-interest-bearing liabilities (average))
Return on = (Result from continuing operations before tax - income
equity (%) taxes) per
(Members' funds (average))
Equity ratio = (Members' funds) per
(%) (Balance total - advance payments received)
Net gearing = (Interest bearing borrowings - liquid funds -
ratio (%) interest-bearing receivables) per
(Members' funds)
© 2024 Nasdaq, Inc. All Rights Reserved |