2013-10-31 07:00:00 CET
2013-10-31 07:00:06 CET
REGULATED INFORMATION
Technopolis - Interim report (Q1 and Q3)
Technopolis Group Interim Report January 1 - September 30, 2013
TECHNOPOLIS PLC INTERIM REPORT October 31, 2013 at 8:00
a.m.
Technopolis Group Interim Report January 1 - September 30, 2013
Strong Net Sales and EBITDA Growth
- Net sales rose to EUR 91.6 (78.7) million, an increase of 16.5%
- EBITDA rose to EUR 47.2 (40.3) million, an increase of 17.1%
- Direct result (EPRA) rose to EUR 29.3 (19.8) million
- Direct result per share (EPRA) was EUR 0.39 (0.29)
- Earnings per share were EUR 0.16 (0.25), including changes in fair value and
unrealized exchange rate losses
- Cash flow from operations per share was EUR 0.42 (0.36)
- The financial occupancy rate was 92.0% (94.8%)
- Net asset value per share (EPRA) was EUR 5.52 (5.52)
The increase in net sales and EBITDA was mainly due to an increase of 15.5% in
space. Direct result (EPRA) increased by 47.9% to EUR 29.3 (19.8) million,
mainly due to the increase in EBITDA and a change in tax recognition. The
operating profit excluding changes in fair value was EUR 45.3 (38.8) million,
and including tax effects, the profit attributable to the shareholders of the
parent company was EUR 24.4 (21.2) million. The operating profit excluding
change in fair value increased by 16.5% and the net result including tax
effects by 15.5%.
7-9/ 7-9/ 1-9/ 1-9/ 1-12/
Key Indicators 2013 2012 2013 2012 2012
--------------------------------------------------------------------------------
Net sales, EUR million 30.8 26.6 91.6 78.7 107.3
EBITDA, EUR million 17.1 14.4 47.2 40.3 55.8
Operating profit, EUR million 9.9 14.1 32.3 32.9 48.0
Net result for the period, EUR 4.5 8.9 14.2 17.1 25.8
million
Earnings/share, undiluted, EUR 0.05 0.13 0.16 0.25 0.37
Earnings/share, diluted, EUR 0.04 0.13 0.16 0.25 0.37
Cash flow from operations/share, EUR 0.13 0.15 0.42 0.36 0.56
Equity ratio, % 39.4 36.9 36.2
Equity/share, EUR 5.00 4.83 4.94
EPRA-based 7-9/ 7-9/ 1-9/ 1-9/ 1-12/
Key Indicators *) 2013 2012 2013 2012 2012
--------------------------------------------------------------------------------
Direct result, EUR million 10.8 7.3 29.3 19.8 29.9
Direct result/share, diluted, EUR 0.14 0.11 0.39 0.29 0.43
Net asset value/share, EUR 5.52 5.52 5.67
Net rental yield, % 7.6 7.8 7.8
Financial occupancy rate, % 92.0**) 94.8 95.3
*) EPRA = European Real Estate Association
**) Financial occupancy rate does not include space under renovation
Keith Silverang, CEO:
The company's profitable growth continued during the period under review, and
the acquisitions agreed in October laid a good foundation for the next few
years. We have succeeded in keeping occupancy rates on a satisfactory level in
spite of the challenging conditions in Finland, and the company's profitability
is good. Occupancy rates have increased in both completed properties and
properties under construction in our international units. Rents have also been
on the rise. We estimate that our financial performance will develop steadily
during the rest of the year and that the financial occupancy rate will rise to
at least 92.7%. Furthermore, the company has signed pre-lets for an additional
11,400 sqm, which provide a good starting point for improving the occupancy
rate in 2014. The company's responsible investment policy and the successful
integration of previous acquisitions have contributed to profitable growth. In
particular, this is reflected in the EPRA-based direct result, which increased
by 47.9% from the previous year.
In October, we announced that we will acquire a campus in Fornebu, Oslo, and
that we are negotiating the acquisition of the Falcon Business Park in
Otaniemi, Espoo. If closed, the deals will provide us with significant growth
in net sales and EBITDA in 2014, and a strong local partner in Oslo. If these
acquisitions are realized, the company will be quite close to its objective of
EUR 50 million in net sales outside Finland. Technopolis will then have a
geographically better balanced campus portfolio. The shareholders' meeting that
will take place at the beginning of November will decide on authorizing the
Board of Directors to arrange a rights issue. The aim is to raise approximately
EUR 100 million and use it to finance the acquisitions mentioned above and
strengthen the company's equity ratio.
The takeover and careful integration of new investments into the company are an
essential part of the company's growth strategy. We have, for example,
succeeded in increasing the financial occupancy rate of the Peltola campus in
Oulu by 20 percentage points in eight months. Next year, our aim is to focus on
integrating acquired campuses, implementing our service concept, increasing
occupancy rates and improving profitability.
Since these acquisitions will have no significant influence on our 2013 figures
the previously announced 14% - 17% net sales and EBITDA growth forecasts for
2013 remain valid. The full effect of the acquisitions will be felt in our net
sales and EBITDA for 2014.
Business Conditions
According to consensus information collected by the Federation of Finnish
Financial Services, Finland's GDP is forecast to decrease by 0.3% in 2013. GDP
growth is being dragged down by rising unemployment, a soft cycle in exportsand lower private consumption due to heavier taxation. According to forecasts,
the unemployment rate will grow to 8.3% and inflation will decrease to 1.9%.
The Russian economy has remained relatively strong, but the leveling off of oil
prices is likely to decelerate economic growth. In 2013, GDP is expected to
grow by 2%. Estimates are that inflation will increase to 6.5% and the
unemployment rate will rise to 5.6%.
Estonia's GDP is expected to grow by approximately 1.9% in 2013, supported by
the good price competitiveness of the export sector. The unemployment rate is
expected to decrease to 9.2% and inflation to slow to 3.3%.
In Lithuania, private consumption and export are supporting robust GDP growth.
GDP is expected to rise by 4.0% in 2013. The unemployment rate is expected to
decrease to 11.2% and inflation to slow to 1.7%.
Financial Occupancy Rates
In spite of general economic uncertainty, demand for Technopolis business space
has remained good. The Group's financial occupancy rates are as follows:
Sept 30, June 30, March 31, Dec 31, Sept 30,
2013*) 2013 2013 2012 2012
--------------------------------------------------------------------------------
Group 92.0 92.7 92.2 95.3 94.8
--------------------------------------------------------------------------------
Finland 91.0 91.7 91.5 95.1 94.7
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Oulu 85.6 84.2 85.9 94.5 93.3
HMA 92.5 93.6 94.1 91.9 92.0
Tampere 96.5 97.4 97.1 97.6 98.1
Kuopio 94.0 93.9 87.6 94.9 94.3
Jyväskylä 91.9 98.9 98.9 98.6 98.4
Lappeenranta 92.4 94.3 93.6 92.5 93.5
Estonia, Tallinn 96.2 96.6 96.1 94.9 92.5
--------------------------------------------------------------------------------
Lithuania, 99.8 99.9 - - -
Vilnius
--------------------------------------------------------------------------------
Russia, St. 100.0 98.8 100.0 100.0 100.0
Petersburg
--------------------------------------------------------------------------------
*) Financial occupancy rate does not include space under renovation
During the third quarter, the company began to deduct the square meters of
space under renovation from the rentable space in calculating the financial
occupancy rate. The effect of this change was 1.2 percentage points in the
third quarter.
Business Segments
Geographic Segments
The net sales and EBITDA of Finnish operations developed favorably in January -
September 2013. Net sales were EUR 81.0 (71.3) million and EBITDA was EUR 42.2
(37.5) million. The EBITDA margin was 52.1% (52.6%), reflecting the lower
financial occupancy rate. Net sales improved by 13.6% and EBITDA by 12.5%
compared to January - September 2012.
The net sales of the Tallinn airport campus for January - September 2013 were
EUR 4.7 (3.6) million and EBITDA was EUR 1.6 (1.4) million. Net sales were
higher due to a higher financial occupancy rate and a change in the accounting
policy for maintenance charges in accordance with the Group's general
accounting policy as of the beginning of 2013. Adjusted for the change in
accounting policy, the comparable net sales in January - September 2013 were
EUR 3.8 million, and the EBITDA margin was 64.9% (64.2%). Compared to January -
September 2012, comparable net sales rose by 6.6% and EBITDA by 7.9%.
The net sales of the St. Petersburg airport campus for January - September 2013
were EUR 3.9 (3.7) million and EBITDA was EUR 1.1 (1.2) million. The EBITDA
margin was 27.5% (32.1%). The lower EBITDA margin of the campus compared to
other geographic segments is related to the unit's low amount of rentable
space.
The Vilnius campus acquired in Lithuania was consolidated into the accounts on
May 31, 2013. The unit's net sales for June - September amounted to EUR 2.0
million and EBITDA to EUR 1.5 million. The EBITDA margin was 75.6%. The figures
include a non-recurring income item of EUR 0.2 million. The full-year net sales
are expected to come in at approximately EUR 3.5 - 3.6 million and EBITDA at
approximately EUR 2.5 - 2.7 million.
Space and Service Operations
In January - September 2013, rental revenue accounted for 88.4% (87.0%) and
service revenue for 11.6% (13.0%) of net sales. The acquisitions of new
campuses in Vilnius and Oulu influenced the higher relative share of service
operations. Depending on the campus, service operations are expected to reach
their net sales target within 1 - 3 years of acquisition.
Breakdown of Net Sales and EBITDA by Sector:
7-9/2013 7-9/2012 1-9/2013 1-9/2012 1-12/2012
------------------------------------------------------------
Space
Net sales 27.5 23.2 81.0 68.4 93.0
EBITDA 18.4 15.9 51.7 45.3 61.9
EBITDA % 67.1 68.4 63.8 66.2 66.5
------------------------------------------------------------
Services
Net sales 3.3 3.3 10.7 10.2 14.2
EBITDA 0.3 0.3 1.3 0.9 1.3
EBITDA % 8.5 8.6 12.2 9.1 9.4
------------------------------------------------------------
The EBITDA margin of the office space rental business decreased by 2.9% during
January - September 2013 compared to the previous year as a result of a lower
initial financial occupancy rate. The EBITDA margin increased to 12.2% (9.1%)
in the service sector due to business restructuring.
Financial Performance
The Group's net sales for the period under review were EUR 91.6 (78.7) million,
an increase of 16.5% compared to January - September 2012. The growth mainly
comprised a 15.5% increase in space. The Group's EBITDA rose to EUR 47.2 (40.3)
million in January - September, up 17.1%. The EBITDA margin was 51.5% (51.2%).
The EBITDA for the period under review includes EUR 0.8 million in
non-recurring expenses related to previous investments, the restructuring of
service operations and incorporation of properties into five regional companies
in Finland. Changes of EUR 13.0 (-6.0) million in the fair value of investment
properties, resulting from increased net yields in Finland, had a negative
effect on financial performance. The net market yields of foreign campuses
remained at the same level as on June 30, 2013. The Group's operating profit
was EUR 32.3 (32.9) million. Excluding changes in fair value, the operating
profit was EUR 45.3 (38.8) million.
The Group's net financial expenses for January - September totaled EUR 14.9
(9.6) million. EUR 3.9 million in unrealized exchange rate losses impacted net
financial expenses. The losses were related to the Russian subsidiary's
euro-denominated loans following the weakening of the Russian ruble. The
Group's pre-tax profit totaled EUR 17.3 (23.3) million. The pre-tax profit
excluding fair value changes was EUR 30.3 (29.3) million.
The EPRA-based direct result increased by 47.9% to EUR 29.3 (19.8) million for
January - September 2013. Earnings per share increased to EUR 0.39 (0.29). An
increase in net sales and EBITDA and a decrease in taxes contributed to the
improvement in the EPRA-based figures. Financial expenses were EUR 10.7 (10.7)
million and taxes EUR 4.2 (6.7) million.
Customers and Lease Stock
Technopolis has a total of approximately 1,400 customers, and 26,000 people
work in Technopolis facilities. The twenty largest customers lease
approximately 36.4% of the company's rentable space.
Termination notice periods Sept 30, June 30, March 31, Dec 31, Sept 30,
in months 2013 2013 2013 2012 2012
------------------------------------------------------------------------------
------------------------------------------------------------------------------
0-3 12.1 13.7 13.7 13.8 17.3
3-6 21.1 24.2 25.5 25.3 28.1
6-9 5.9 5.9 7.0 7.4 7.4
9-12 4.9 5.4 6.5 6.7 7.6> 12 months, total 56.0 50.8 47.2 46.8 39.6
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Average lease term in months 43 37 35 39 25
------------------------------------------------------------------------------
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Lease stock, EUR million 347.2 342.2 311.1 296.1 238.2
Long fixed-term leases signed by the company increased the average lease term
by 18 months and the lease stock by 45.8% compared to the previous year from
EUR 238.2 million to EUR 347.2 million.
Properties and Investments
Technopolis' facilities are located next to good traffic connections in the
vicinity of universities, airports or downtown areas. In 2013, the Group
invested in all of the countries where it operates.
The fair value of the Group's investment properties at the end of the period
totaled EUR 1,133.4 (963.2) million, of which completed investment properties
accounted for EUR 1,038.0 (902.5) million, and investment properties under
construction EUR 95.4 (60.7) million. The net rental yield decreased to 7.6%
(7.8%) due to lower financial occupancy rates in Finland.
Fair value, EUR million Sept 30, June 30, March 31, Dec 31, Sept 30,
2013 2013 2013 2012 2012
--------------------------------------------------------------------------------
Group 1,133.4 1,126.2 1,067.2 1,014.1 963.2
--------------------------------------------------------------------------------
Finland 870.0 879.2 888.0 838.9 784.7
--------------------------------------------------------------------------------
Oulu 252.6 255.9 259.5 225.3 224.2
HMA 197.3 201.4 203.9 205.2 206.5
Tampere 185.3 185.4 186.4 189.2 134.1
Kuopio 109.7 110.3 110.5 92.2 93.6
Jyväskylä 96.4 97.4 98.4 97.9 97.1
Lappeenra 28.6 28.9 29.3 29.2 29.1
nta
Lithuania 48.1 47.3
--------------------------------------------------------------------------------
Russia 53.5 51.8 56.6 53.6 53.5
--------------------------------------------------------------------------------
Estonia 66.5 66.2 65.6 63.9 64.4
--------------------------------------------------------------------------------
Under 95.4 81.6 56.9 57.6 60.7
constructio
n
--------------------------------------------------------------------------------
Market yield requirements applied to the Group's investment properties averaged
8.2% (8.0%), and have been used in the fair value calculations.
The Group's total space in completed investment properties at the end of the
period was 697,500 (604,100) sqm.
1,000 sqm Sept 30, June 30, March 31, Dec 31, Sept 30,
2013 2013 2013 2012 2012
--------------------------------------------------------------------------------
Group 697.5 717.5 690.3 644.3 604.1
--------------------------------------------------------------------------------
Finland 582.6 582.6 586.0 541.0 500.8
--------------------------------------------------------------------------------
Oulu 230.1 230.1 229.8 194.3 194.3
HMA 83.2 83.2 86.6 86.6 86.6
Tampere 112.1 112.1 112.1 112.1 71.9
Kuopio 69.5 69.5 69.8 60.3 60.3
Jyväskylä 60.4 60.4 60.4 60.4 60.4
Lappeenrant 27.3 27.3 27.3 27.3 27.3
a
Estonia 59.3 79.4 80.2 79.2 79.2
--------------------------------------------------------------------------------
Lithuania 31.4 31.4 - - -
--------------------------------------------------------------------------------
Russia 24.1 24.1 24.1 24.1 24.1
--------------------------------------------------------------------------------
The decrease in space in the Tallinn properties was due to the demolition of
old buildings. The Vilnius campus in Lithuania was included in the figures as
of May 31, 2013.
Properties acquired or investments completed during the last 12 months and
projects under construction during the period and their rentable space, as well
as estimated acquisition costs, are as follows:
Area Name Occupan sqm EUR Stabilize Completion
cy million d
rate, % yield, %
Oct 30,
2013
--------------------------------------------------------------------------------
Acquired
--------------------------------------------------------------------------------
-
--------------------------------------------------------------------------------
Tampere Tohloppi 100.0 32,000 23.3 11.8 10/2012
Oulu Peltola 73.6 37,600 31.7 11.2 02/2013
Vilnius Alfa & Beta 99.8 31,200 62.6 *) 9.6 05/2013
Completed
--------------------------------------------------------------------------------
-
Tampere Yliopistonrinne 2 97.5 7,500 22.5 7.6 10/2012
Kuopio Viestikatu 7B&C 93.2 9,300 17.4 9.2 02/2013
Tallinn Löötsa 8C 95.4 6,200 8.3 9.1 03/2013
Under construction **)
--------------------------------------------------------------------------------
-
Vilnius Gamma 85.0 11,000 62.6 *) 8.8 10/2013
Tallinn Löötsa 81.5 16,300 24.3 9.1 10/13-2/14
8A&B ***)
St. Pulkovo 2 32,7 18,700 42.0 12.6 10/2013
Petersbur
g
Jyväskylä Innova 4 91,0 8,900 23.7 8.1 10/2013
--------------------------------------------------------------------------------
*) total value of the Vilnius deal including all phases
**) pre-let rate October 30, 2013
***) commissioning in phases
All of the Technopolis projects under construction at the closing date are
expansions of existing campuses.
Financing
The Group's balance sheet totaled EUR 1,212.8 (1,038.8) million, of which
liabilities totaled EUR 738.2 (657.5) million. The Group's equity per share was
EUR 5.00 (4.83). The Group's equity ratio was 39.4% (36.9%), increasing by 6.2
(0.0) percentage points due to a hybrid loan. The loan-to-value ratio was 57.2%
(59.5%). At the end of the period, the Group's net gearing was 136.6% (147.4%)
and the interest coverage ratio was 5.6 (4.9).
As a general rule, the Group finances 35% of its investments with shareholders'
equity, and the remaining 65% with debt financing, for which the target
property is used as collateral.
At the end of the period, the Group's interest-bearing liabilities from
financial institutions amounted to EUR 658.3 million (EUR 580.3 million), and
the average capital-weighted loan period was 8.1 years (9.0 years). The average
interest rate on interest-bearing liabilities was 2.08% (2.12%). The Group's
interest fixing period was 1.9 (1.5) years at the end of the period. At the end
of the period, 60.8% (67.7%) of interest-bearing liabilities were floating-rate
loans and 39.2% (32.3%) were fixed-rate loans with maturities of 13 - 60
months. Some 5.3% of floating-rate loans were pegged to the under-3-month
Euribor rate, and 55.5% were pegged to Euribor rates from 3 to 12 months.
The Group had interest-bearing liabilities with covenants worth EUR 472.8
(390.9) million. Loans amounting to EUR 354.3 (351.0) million include covenants
relating to the equity ratio. Of these loans, EUR 199.7 (167.2) million include
a call-in provision. The call-in covenant is breached if the equity ratio falls
below 30%. The principal of EUR 174.1 (146.5) million includes an interest
margin revision term. If the equity ratio falls below 33%, the additional
impact on interest expenses would be EUR 0.7 (0.5) million per annum.
Technopolis issued a EUR 75 million hybrid bond in March 2013. The bond has a
7.5% annual coupon rate. It is perpetual, but the company may exercise an early
redemption option after five years.
At the end of the reporting period, Technopolis had EUR 116.7 (110.3) million
in untapped credit facilities, and cash reserves amounting to EUR 10.0 (18.3)
million. The credit facilities include a EUR 102.6 (89.6) million credit line
and a EUR 14.1 (20.7) million revolving credit facility. In addition, the
company has a EUR 120.0 (120.0) million commercial paper program, of which EUR
48.0 (34.0) million was issued at the end of the reporting period. The company
has agreed on new credit facilities totaling EUR 167.9 million.
During the 12-month period following the period under review, EUR 130.2 (94.9)
million in existing interest-bearing loans will mature.
The company's five largest creditors at the end of the period under review were
the European Investment Bank, Handelsbanken, OP-Pohjola Group, Nordea, and
Danske Bank. Their total lending to the company amounted to EUR 465.9 million.
A one percentage point change in market rates would cause a EUR 2.9 (2.8)
million change in interest costs per annum. At the end of the reporting period,
there were interest rate swaps covering EUR 229.2 (156.7) million of principal.
The hedging ratio of interest-bearing liabilities was 34.8% (27.0%).
Organization and Personnel
The CEO of Technopolis Plc is Keith Silverang. Reijo Tauriainen, CFO, is the
company's Deputy CEO.
The Group Management Team comprises Keith Silverang, Reijo Tauriainen, Juha
Juntunen, Sami Juutinen, Kari Kokkonen, and Outi Raekivi. In order to support
the company's growth strategy, the areas of responsibility of the Management
Team members were adjusted in connection with the Group's Strategy Review. As
of January 1, 2014, Sami Juutinen will be responsible for all merger,
acquisition, and divesture-related activities throughout the Group as Chief
Investment Officer (CIO). At the same time, Juha Juntunen, currently Director
of Finnish Operations, Sales and Marketing, will assume responsibility as Chief
Operating Officer (COO) for all business units, in addition to his previous
duties.
The Technopolis operational organization consists of four geographical units:
Finland, Lithuania, Russia, and Estonia. The Group organization also has matrix
support functions for the Group's real estate development, services, marketing,
and support services.
During the period, the Group employed an average of 185 (177) people. Rental
operations employed 64 (65) people, the service business 78 (74) people and the
Group's administration 43 (38) people. At the end of the period under review,
the Group had 187 (178) employees.
Environment and Responsibility
Technopolis has updated its environmental strategy for 2011 - 2015 by adding
new sustainability objectives and extending it until 2016. At the same time,
Technopolis also specified its corporate responsibility vision, mission, and
values.
The environmental goals of the strategy are to reduce energy consumption by
10%, water consumption by 8% and CO2 emissions by 20%. In 2012, Technopolis set
new goals for waste: reducing landfill waste by 10% and achieving a utilization
ratio of at least 60%. Technopolis has chosen LEED (Leadership in Energy and
Environmental Design) building rating systems to compare the environmental
competence of buildings and the Green Office label granted by WWF Finland for
Technopolis offices in different cities. The additional sustainability goals
confirmed in 2013 include: extending the coverage of energy consumption
metering and remote reading to 97% of properties, achieving at least a 75%
recycling rate in all new construction and major renovation projects (LEED),
participating in the GRESB sustainability rating and reporting based on EPRA
(European Real Estate Association) guidelines, in addition to GRI.
Cumulative comparison of units compared to the base year 2011:
1-9/2013 1-9/2011 change, %
--------------------------------------------------------------------------
--------------------------------------------------------------------------
Energy consumption, kWh/gross sqm 164.6 165.7 -0.7
Water consumption, m³/person 1.1 1.2 -13.0
Carbon dioxide emissions, kg CO2e/gross sqm 16.1 44.2 -63.6
--------------------------------------------------------------------------
The comparison only includes comparable properties owned by the company
throughout the year. Increasing energy efficiency as a result of property
energy reviews and savings measures has decreased both energy consumption by
the properties and their carbon dioxide emissions. Compared to the
corresponding time in the previous year, Technopolis has five new,
energy-efficient, LEED-certified properties. The energy consumption of LEED
properties is estimated to be at least 10% lower than that of corresponding
conventional properties.
Strategic Financial Targets
The company's Board of Directors approved the company's strategic financial
targets for 2014 - 2016 on August 15, 2013. The company left unchanged its
targets of average annual growth in net sales and EBITDA of 15%, over EUR 50
million in net sales outside Finland by the end of 2016, and an equity ratio of
35% over the cycle.
The company's Board of Directors specified that the existing target, calling
for at least a 6% return on capital employed per annum, would apply to
operational activities only. The adjusted target for return on capital employed
is based on the recommendations of the European Real Estate Association (EPRA),
instead of the previous figures calculated according to IFRS, adjusting the
revenue for changes in e.g. fair value.
The dividend policy was modified to better match the company's growth targets.
The dividend policy was adjusted such that the company will aim to distribute
on average one third of its net profit, excluding changes in fair value and
their tax impact.
As part of its international growth targets, Technopolis has been analyzing
potential international investment targets in the Baltic Sea and Nordic
regions. The key criteria for potential acquisitions are sufficient size and
growth potential, excellent locations in growth centers, a flexible,
high-quality property portfolio, and positive cash flow. The acquisition must
have a positive impact on earnings per share, and the campus should be a good
match with the Technopolis business concept. The company is also investigating
opportunities to divest properties that are not optimal for its concept.
Evaluation of Operational Risks and Uncertainties
Technopolis' most significant business risks relate primarily to general
economic development associated with financing and customers, as well as
international business risks.
The objective of interest rate risk management is to mitigate the negative
impact of market rate fluctuations on the Group's earnings, financial position,
and cash flow. If necessary, the company uses forwards, interest rate swaps and
interest rate options to hedge interest rate risks. The company's policy
concerning interest rate risks also aims to diversify the interest rate risk of
loan contracts over different loan periods based on the prevailing market
situation.
The objective of refinancing risk management is to ensure that the Group's loan
portfolio is sufficiently diversified with regard to repayment schedules and
financing instruments. In order to manage the financing risk, Technopolis draws
upon the resources of a wide range of financers and a variety of financing
instruments, and maintains a sufficient degree of solvency.
Uncertainty in the financial markets may adversely affect the availability of
growth financing, refinancing, and their margins in the future.
The differences between legislation and administrative procedures in Finland
and abroad may create risks.
Changes in exchange rates may have an effect on the company's financial
performance and operations. In accordance with its foreign exchange hedging
policy, the company does not hedge balance sheet items. Foreign currency items
are recorded at the exchange rate on the transaction date. Any translation
differences are entered in the comprehensive income statement under other
operating expenses or financial income and expenses, according to the type of
transaction involved.
Customer risk management aims to minimize the negative impact of potential
changes in customers' financial position on the company's business and
financial performance. Customer risk management focuses on having a profound
understanding of the customer's business and active monitoring customer
information. Customer risks are diversified by acquiring customers from all
sectors, including the public sector. As part of client risk management,
Technopolis leases include rental security arrangements.
The company's leases fall into two categories: fixed-term and open-ended. The
company aims to apply both lease types, depending on the market situation, the
property in question, and the sector in which the customer operates.
Declining financial occupancy rates may reduce rental and service revenue and
profit, and reduce the fair value of investment properties and, thus, the
equity ratio. The current lease structure allows customers to flexibly adjust
the space they need as their business needs change. Although the flexibility of
the lease structure may pose a risk to the Group, it is an essential element of
Technopolis' service concept. The company has solid, long-term experience in
this business model over a wide variety of economic cycles.
In new construction projects, Technopolis focuses on quality and the management
of the property's entire life cycle. In the design phase, consideration is
given to the property's maintenance and repair requirements in order to
implement environmentally sustainable solutions for energy consumption,
adaptability of premises, and recycling potential. When purchasing properties,
Technopolis carries out standard property and environmental audits before
committing to the transaction. All properties are covered by full value
insurance.
Changes in market yields may have a significant impact on the company's
financial performance through the fair values of investment properties. As the
yields increase, the fair value of properties decreases. Conversely, as the
yields decrease, the fair value of properties increases. Such changes either
decrease or increase the Group's operating profit. Changes in market yields do
not have any direct impact on the company's net sales, EBITDA, or cash flow,
but a negative change in the value of investment properties may reduce the
company's equity ratio and, as a result of this, the covenant terms of the
loans may be met. In that case, the change in value can have an impact on the
cash flow and result for the period.
Group Structure
Technopolis Group comprises the parent company Technopolis Plc, whose
subsidiaries have operations in Finland, Lithuania, Russia, and Estonia. The
parent company has several subsidiaries and associates in Finland. In
Lithuania, the parent company has a subsidiary, Technopolis Lietuva UAB (100%),
which owns the three real estate companies associated with the Vilnius campus.
The parent company has two subsidiaries in Russia: Technopolis Neudorf LLC and
Technopolis St. Petersburg LLC, both wholly owned. The Estonian subsidiary
Technopolis Baltic Holding OÜ (wholly owned) manages the holdings in
Technopolis Ülemiste AS (51%).
Technopolis Group established new subsidiaries during the review period:
Technopolis Lietuva UAB, Kiinteistö Oy Technopolis Peltola and Kiinteistö Oy
Yrttiparkki. Technopolis Lietuva UAB owns the real estate companies UAB
Domestas, UAB Urban housing, and UAB Gama projektai. Technopolis Plc owns five
regional real estate companies which, after the business transfer and capital
contribution executed on February 28, 2013, each own shares in properties and
leases located in the respective regions.
Annual General Meeting 2013
The Annual General Meeting of Shareholders (AGM) of Technopolis was held in
Oulu on March 27, 2013.
Resolutions of the Annual General Meeting
The AGM 2013 adopted the Group and parent company's financial statements for
the financial year 2012 and discharged the company's Board of Directors and CEO
from liability. The AGM decided, in accordance with the proposal of the Board
of Directors, to distribute a dividend of EUR 0.20 per share. The dividend was
paid to shareholders who were registered in the company shareholders register
kept by Euroclear Finland Ltd on the record date of April 3, 2013. The dividend
payment date was April 10, 2013.
Board of Directors and Remuneration of the Members of the Board of Directors
The number of members of the Board of Directors was confirmed at six. Sari
Aitokallio, Carl-Johan Granvik, Jorma Haapamäki, Pekka Korhonen, Matti
Pennanen, and Timo Ritakallio were elected members of the Board for a term of
office expiring at the end of the next Annual General Meeting. Carl-Johan
Granvik was elected Chairman of the Board of Directors and Matti Pennanen was
elected Vice Chairman.
It was resolved to pay the members of the Board of Directors annual
remuneration as follows: EUR 50,000 to the Chairman of the Board, EUR 30,000 to
the Vice Chairman of the Board, and EUR 25,000 to each of the other members of
the Board. In addition, it was decided that, for participation in meetings of
the Board of Directors, each member of the Board of Directors shall, in
addition to the annual remuneration, be paid a fee of EUR 600 and the Chairman
of the Board of Directors a fee of EUR 1,200 for each Board meeting, and the
chairmen of the committees a fee of EUR 800 and each member of the committees a
fee of EUR 600 for each meeting of the committees, and that the travel expenses
of the members of the Board of Directors and the members of the committees
shall be compensated in accordance with the company's travel policy.
The AGM decided that the annual remuneration is paid on the condition that the
Board members commit to using 50% of their annual remuneration to acquire
Technopolis Plc shares on the market at the price determined in public trading.
The shares are to be acquired within three weeks of the publication of the
Interim Report for the period January 1 - March 31, 2013. If the shares cannot
be purchased during this period due to insider regulations, they will be
acquired on the first occasion possible according to valid insider regulations.
Board members are not allowed to transfer the shares obtained as annual
remuneration before their membership of the Board has ended.
In the first organizational meeting of the Board of Directors following the
AGM, the Board appointed an audit committee and a remuneration committee from
among its members. The Audit Committee consists of Carl-Johan Granvik (Chair),
Sari Aitokallio, and Pekka Korhonen. The remuneration committee consists of
Timo Ritakallio (Chair), Jorma Haapamäki, and Matti Pennanen. The Board of
Director's view is that all of the Board members are independent of the company
and, excluding Timo Ritakallio, of its major shareholders.
Auditor
KPMG Oy Ab, authorized public accountants, was re-elected as auditor of the
company, with Mr. Ari Eskelinen, APA, as the Auditor-in-Charge.
Shareholders' Nomination Board
The Annual General Meeting decided to establish a Shareholders' Nomination
Board to prepare proposals concerning the election and remuneration of the
members of Board of Directors for the General Meeting and adopted the Charter
of the Shareholders' Nomination Board. The Nomination Board is established for
an indefinite period.
The Nomination Board shall consist of three members nominated by the
shareholders of the company. In addition, the Chairman of the Board of
Directors of the company participates in the work of the Nomination Board as an
expert.
The right to nominate members shall be vested with the three shareholders of
the company having the largest share of the votes represented by all the shares
in the company annually on September 1, based on the company's shareholder
register held by Euroclear Finland Ltd. However, if a shareholder who has
distributed his/her holdings e.g. into several funds, and has an obligation
under the Finnish Securities Markets Act to take these holdings into account
when disclosing changes in his/her share of ownership, makes a written request
to such effect to the Chairman of the Board of Directors no later than on
August 31, the aforementioned shareholder's holdings in several funds or
registers will be combined when calculating the share of votes which determines
the nomination rights. Should a shareholder not wish to exercise his/her
nomination rights, the rights shall be transferred to the next largest
shareholder who otherwise would not be entitled to nominate a member. The term
of office of the members of the Nomination Board expires annually when the new
Nomination Board has been appointed.
Based on shareholdings as of September 1, 2013, the members of the
Shareholders' Nomination Board are: Risto Murto, Vice President of Varma Mutual
Pension Insurance Company, as the chairman, with Harri Sailas, President and
CEO of Ilmarinen Mutual Pension Insurance Company, and Jukka Weisell, CFO of
the City of Oulu. In addition, Carl-Johan Granvik, Chairman of the Board of
Directors of Technopolis Plc, acts as the Nomination Board's expert member.
Board Authorizations
The AGM authorized the Board of Directors to decide on the repurchase and/or on
the acceptance as pledges of the company's own shares as follows.
The amount of treasury shares to be repurchased and/or accepted as pledge shall
not exceed 7,556,100 shares, which corresponds to approximately 10% of all the
shares in the company. Under the authorization, the company's own shares may
only be purchased using unrestricted equity. The company's own shares may be
purchased at a price set in public trading on the date of purchase or at a
price otherwise determined on the market. The Board of Directors decides how
treasury shares will be repurchased and/or accepted as pledge. Treasury shares
can be repurchased using, inter alia, derivatives. The company's own shares can
be repurchased otherwise than in proportion to the shareholdings of the
shareholders (directed repurchase). The authorization is effective until the
end of the next Annual General Meeting; however, no later than June 30, 2014.
The Annual General Meeting authorized the Board of Directors to decide on the
issuance of shares and other special rights entitling to shares referred to in
Chapter 10, Section 1 of the Limited Liability Companies Act as follows:
Pursuant to this authorization, the maximum number of shares to be issued will
be 15,112,200, equaling approximately 20% of the company's shares. However, no
more than 170,000 shares may be issued on the basis of the authorization for
the purpose of implementing incentive schemes decided upon by the General
Meeting or the Board of Directors. The Board of Directors decides on all the
terms and conditions of the issuance of shares and of special rights entitling
to shares. The issuance of shares and of special rights entitling to shares may
be carried out in deviation from the shareholders' pre-emptive rights (directed
issue). The Board of Directors may decide on the company's share-based
incentive schemes. The authorization is effective until the end of the next
Annual General Meeting; however, no later than June 30, 2014.
Stock-Related Events and Disclosures of Changes in Holdings
In March 2013, 14,859 new Technopolis Plc shares were subscribed based upon the
2007C stock options, and 69,379 new shares related to the share-based incentive
scheme 2010 - 2012. The new shares were entered into the Trade Register on
April 4, 2013.
In April, 2013 a total of 240,933 new Technopolis Plc shares were subscribed
based upon the 2007C stock options. The new shares were entered into the Trade
Register on May 15, 2013.
In August 2013, a total of 15,436 new Technopolis Plc shares were subscribed
based upon the 2007C stock options and entered into the Trade register on
August 23, 2013.
At the end of the period, on September 30, 2013, the company had 75,901,834
shares. The shares are in a single series, and each share entitles the holder
to one vote at the Annual General Meeting. The company's share capital is EUR
96,913,626.29.
Unused Board Authorizations
The Board of Directors has been authorized by the Annual General Meeting of
2013 to decide on the issuance of shares and the issuance of special rights
entitling holders to shares referred to in the Limited Liability Companies Act,
as well as on the repurchase and/or on the acceptance as pledge of the
company's own shares. The company's Board of Directors has not exercised the
authorizations, and the company did not hold any treasury shares at the end of
the reporting period.
Post-Fiscal Events
Technopolis announced on October 11, 2013 that it had signed an agreement to
acquire a campus in the greater Oslo region in Norway. Technopolis will acquire
a 70% of the campus with an enterprise value of NOK 1,800 (EUR 220 million).
The seller will retain a 30% holding in the new joint venture company to be
established. The subsidiary will be capitalized with 35% in equity and 65% in
debt. The closing of the transaction is expected to take place in December
2013.
On the same day, the company also announced that it was preparing to acquire a
campus in Otaniemi, Espoo, and that it was investigating the possibility of
executing the acquisition as a joint venture with a co-investor. The indicative
purchase price for Falcon Business Park including taxes is estimated at EUR
77.5 million. On October 26, 2013, the company announced that it had signed an
agreement on the acquisition of Falcon Business Park without a co-investor. The
transaction is expected to be completed in two parts before year-end 2013.
In addition, the company's Board of Directors announced on 11 October, 2013
that it was preparing a rights issue of approximately EUR 100 million for a
maximum of 45,500,000 new shares. On the same day, the Board of Directors
called for an Extraordinary General Meeting to be held on November 1, 2013, to
seek authorization for the issue.
Future Outlook
The company's forecast for 2013 published on May 31, 2013 is unchanged. Net
sales and EBITDA are expected to grow by 14% - 17% compared to the previous
year.
The Group's financial performance depends on the development of overall
business conditions, customer operations, financial markets, and real estate
market yield requirements. Furthermore, any changes in the property portfolio
may have an impact on the guidance.
Vantaa, October 30, 2013
TECHNOPOLIS PLC
Board of Directors
Additional information:
Keith Silverang
CEO
tel. +358 40 566 7785
APPENDICES:
A presentation of the Interim Report is available on the company's website at
www.technopolis.fi. To request a printed copy of the document, please call +358
46 712 000 /Technopolis info. The company's financial review for 2012 was
published on March 4, 2013, on the company's website.
Technopolis offers a service for receiving reports and releases on the
company's website at www.technopolis.fi. Individuals who sign up with the
service will receive the company's bulletins electronically.
Tables
The accounting policies applied in the interim report are the same as in the
2012 financial statements. The formulas for calculating key indicators are
available on the company website.
The Company has amended the recognition principle of deferred taxes as of the
beginning of 2013 in accordance with IAS 8 paragraph 14(b). The Company
estimates that it will liquidate its shareholdings in real estate companies by
selling the shares it holds. The effect amounts to EUR 6.3 million, which is
recognized in retained earnings. The change has also a future effect on the
company's equity ratio. The amendment has also a future effect on the accrual
of deferred taxes and equity ratio.
The interim report has been prepared in accordance with IFRS recognition and
valuation principles; the IAS 34 requirements have also been complied with.
The figures are unaudited.
Technopolis Group:
STATEMENT OF COMPREHENSIVE INCOME 7-9/ 7-9/ 1-9/ 1-9/ 1-12/
Currency unit: EUR million 2013 2012 2013 2012 2012
--------------------------------------------------------------------------------
Net sales 30,8 26,6 91,6 78,7 107,3
Other operating income 1) 0,2 0,3 1,3 1,0 1,7
Other operating expenses -13,9 -12,5 -45,7 -39,4 -53,3
Change in fair value of investment properties -6,5 0,2 -13,0 -6,0 -5,7
Depreciation -0,7 -0,5 -2,0 -1,5 -2,0
--------------------------------------------------------------------------------
Operating profit/loss 9,9 14,1 32,3 32,9 48,0
Finance income and expenses -5,0 -2,4 -14,9 -9,6 -13,6
--------------------------------------------------------------------------------
Result before taxes 4,9 11,7 17,3 23,3 34,5
Current taxes 0,2 -2,4 -1,7 -4,8 -7,5
--------------------------------------------------------------------------------
Net result for the period 5,1 9,3 15,6 18,5 27,0
Other comprehensive income items
Translation difference -1,2 0,7 -2,8 0,8 0,9
Available-for-sale financial assets 0,0 0,0 0,0 0,0 0,0
Derivatives 0,0 -1,4 2,9 -3,9 -4,0
Taxes related to other comprehensive income 0,0 0,3 -0,7 0,9 1,0
items
--------------------------------------------------------------------------------
Other comprehensive income items after taxes -1,1 -0,4 -0,6 -2,0 -2,0
for the period
Comprehensive income for the period, total 4,0 8,9 15,1 16,4 24,9
Distribution of profit for the period:
To parent company shareholders 4,5 8,9 14,2 17,1 25,8
To non-controlling shareholders 0,6 0,3 1,5 1,4 1,1
--------------------------------------------------------------------------------
5,1 9,3 15,6 18,5 27,0
Distribution of comprehensive income for the
period:
To parent company shareholders 3,4 8,6 13,6 15,0 23,8
To non-controlling shareholders 0,6 0,3 1,5 1,4 1,1
--------------------------------------------------------------------------------
4,0 8,9 15,1 16,4 24,9
Earnings per share based on result of flowing to parent company shareholders
adjusted by interest expenses on an equity related bond
Net profit to parent company shareholders 4,5 8,9 14,2 17,1 25,8
Interest expenses on an equity related bond -1,4 -2,9
Tax effect 0,3 0,7
----------------------------------
Adjusted net profit 3,4 8,9 12,0 17,1 25,8
Earnings per share, basic, EUR 0,05 0,13 0,16 0,25 0,37
Earnings per share, diluted, EUR 0,04 0,13 0,16 0,25 0,37
1) Other operating income consists of operating subsidies received for
development services; an equal amount is recorded under operating expenses for
development services.
STATEMENT OF FINANCIAL POSITION,
ASSETS
Currency unit: EUR million 30.09.201 30.09.201 31.12.2012
3 2
--------------------------------------------------------------------------
Non-current assets
Intangible assets 5,7 8,3 5,6
Tangible assets 23,0 16,5 13,7
Completed investment properties 1038,0 902,5 956,5
Investment properties under 95,4 60,7 57,6
construction
Investments 13,8 12,6 12,5
Deferred tax assets 5,3 2,6 2,7
--------------------------------------------------------------------------
Non-current assets 1181,2 1003,2 1048,6
--------------------------------------------------------------------------
Current assets 31,6 35,5 34,1
--------------------------------------------------------------------------
Assets, total 1212,8 1038,8 1082,7
--------------------------------------------------------------------------
STATEMENT OF FINANCIAL POSITION,
SHAREHOLDERS' EQUITY AND
LIABILITIES
Currency unit: EUR million 30.09.201 30.09.201 31.12.2012
3 2
--------------------------------------------------------------------------
Shareholders' equity
Share capital 96,9 96,9 96,9
Premium fund 18,6 18,6 18,6
Equity related bond 74,2
Other funds 112,9 110,3 110,2
Translation difference -2,5 0,2 0,3
Retained earnings 142,5 121,9 121,7
Net profit for the period 14,2 17,1 25,8
--------------------------------------------------------------------------
Parent company's shareholders' 456,8 364,9 373,5
interests
Non-controlling interests 17,2 16,3 16,1
--------------------------------------------------------------------------
Shareholders' equity, total 474,0 381,2 389,5
Liabilities
Non-current liabilities
Interest-bearing liabilities 528,1 485,4 499,7
Non-interest-bearing liabilities 4,2 0,9 0,3
Deferred tax liabilities 40,3 47,4 49,7
--------------------------------------------------------------------------
Non-current liabilities, total 572,6 533,7 549,7
Current liabilities
Interest-bearing liabilities 130,2 94,9 108,4
Non-interest-bearing liabilities 35,9 29,0 35,0
--------------------------------------------------------------------------
Current liabilities, total 166,2 123,9 143,5
Liabilities, total 738,8 657,5 693,2
--------------------------------------------------------------------------
Shareholders' equity and 1212,8 1038,8 1082,7
liabilities, total
--------------------------------------------------------------------------
STATEMENT OF CASH FLOWS 1-9/ 1-9/ 1-12/
Currency unit: EUR million 2013 2012 2012
--------------------------------------------------------------------------------
Cash flows from operating activities
Net result for the period 15,6 18,5 27,0
Adjustments:
Change in fair value of investment 13,0 6,0 5,7
properties
Depreciation 2,0 1,5 2,0
Share of profits of associates 0,1
Gains from disposals 0,0 -0,1 -0,1
Other adjustments for non-cash 0,2 0,2 0,2
transactions
Financial income and expenses 14,9 9,6 13,6
Taxes 1,7 4,8 7,5
Increase / decrease in working capital 0,0 -1,8 1,0
Interests received 0,1 0,1 0,2
Dividends received 0,0 0,0 0,0
Interests paid and fees -6,2 -8,3 -10,3
Other financial items in operating -6,9 -3,7 -4,4
activities
Taxes paid -2,9 -3,3 -3,3
--------------------------------------------------------------------------------
Net cash provided by operating 31,5 23,4 39,2
activities
Cash flows from investing activities
Investments in other securities 0,0
Investments in investment properties -87,0 -63,2 -107,2
Investments in tangible and intangible -1,0 -5,6 -8,2
assets
Granted loans -1,6
Repayments of loan receivables 0,0 0,0
Proceeds from sale of investments 0,0 0,0
Proceeds from sale of tangible and 0,0 0,1 0,1
intangible assets
Acquisition of subsidiaries -22,7 -0,7 -0,7
Acquisition of associates -0,7 -0,7
--------------------------------------------------------------------------------
Net cash used in investing activities -112,3 -70,0 -116,6
Cash flows from financing activities
Issue of hybrid bond 75,0
Increase in long-term loans 58,8 70,6 96,3
Decrease in long-term loans -45,9 -47,1 -58,2
Dividends paid -15,1 -12,7 -12,7
Paid share issue 0,5 32,6 32,7
Capital investment by the minority 1,8 1,8
Change in short-term loans 2,2 7,2 20,9
--------------------------------------------------------------------------------
Net cash provided by financing 75,5 52,5 80,8
activities
Net increase/decrease in cash assets -5,3 6,0 3,3
Effects of exchange rate fluctuations -0,4 -0,1 -0,2
on cash held
Cash and cash equivalents at 15,7 12,5 12,5
period-start
Cash and cash equivalents at 10,0 18,3 15,7
period-end
STATEMENT
OF CHANGES
IN EQUITY
Currency Equity attributable to owners of the parent
unit: EUR
million
--------------------------------------------------------------------
Share Premium Other Translati Retained Share of Total
capit fund reserv on earnings non-cont shareholder
al es differenc rolling s' equity
es interest
s
Equity 96,9 18,6 81,1 -0,6 134,1 13,1 343,2
January 1,
2012
--------------------------------------------------------------------------------
Comprehensi
ve income
Net profit 17,1 1,4 18,5
for the
period
Other
comprehensive
income items
Translation 0,8 0,8
difference
Derivatives -2,9 -2,9
Available-for-sale 0,0 0,0
financial assets
--------------------------------------------------------------------------------
Comprehensive -2,9 0,8 17,1 1,4 16,4
income for the
period
Related party
transactions
Share issue 32,1 32,1
Dividend -12,7 -12,7
Change in ownership 0,1 0,1
interests in subsidiaries
2)
Other changes 0,0 0,4 1,8 2,2
--------------------------------------------------------------------------------
Related party 32,1 -12,2 1,8 21,7
transactions
--------------------------------------------------------------------------------
Equity 96,9 18,6 110,3 0,2 139,0 16,3 381,2
September 30,
2012
--------------------------------------------------------------------------------
Equity January 96,9 18,6 110,2 0,3 157,3 16,1 399,4
1, 2013 3)
--------------------------------------------------------------------------------
Comprehensive
income
Net profit for 14,2 1,5 15,6
the period
Other comprehensive
income items
Translation -2,8 -2,8
difference
Derivatives 2,2 0,0 2,2
Available-for-sale 0,0 0,0 0,0
financial assets
--------------------------------------------------------------------------------
Comprehensive income 2,2 -2,8 14,2 1,5 15,1
for the period
Related party
transactions
Dividend -15,1 -0,4 -15,5
Equity related 74,2 74,2
bond issue
Other changes 0,5 0,3 0,0 0,8
--------------------------------------------------------------------------------
Related party 74,7 -14,8 -0,4 59,6
transactions
--------------------------------------------------------------------------------
Equity 96,9 18,6 187,2 -2,5 156,7 17,2 474,0
September 30,
2013
--------------------------------------------------------------------------------
2) Acquisition of non-controlling interests without change in control
3) Effect of changes in recognition principle of deferred taxes, EUR 6.3
million, and in group structure, EUR 3.5 million, total of EUR 9.8 million, has
been recognized in opening balance of 2013 in retained earnings.
FINANCIAL INFORMATION BY SEGMENTS
Technopolis Group has four operating segments based on geographical units:
Finland, Russia, Estonia and Lithuania. The segment division presented in this
interim report is based on the Group's existing internal reporting procedures
and the organization of the Group's operations. The Group's net sales or EBITDA
do not include significant inter-segment items.
SEGMENT INFORMATION 7-9/ 7-9/ 1-9/ 1-9/ 1-12/
Currency unit: EUR million 2013 2012 2013 2012 2012
--------------------------------------------------------------
Net sales
Finland 26,6 24,0 81,0 71,3 97,4
Russia 1,3 1,3 3,9 3,7 5,0
Estonia 1,5 1,2 4,7 3,6 4,8
Lithuania 1,4 0,0 2,0 0,0 0,0
Unallocated 0,0 0,0 0,0 0,0 0,0
Total 30,8 26,6 91,6 78,7 107,3
--------------------------------------------------------------
EBITDA
Finland 14,8 13,4 42,2 37,5 51,2
Russia 0,4 0,6 1,1 1,2 1,4
Estonia 0,9 0,9 2,5 2,3 3,1
Lithuania 1,0 0,0 1,5 0,0 0,0
Unallocated 0,0 -0,5 0,0 -0,7 0,0
Total 17,1 14,4 47,2 40,3 55,8
--------------------------------------------------------------
Assets
Finland 952,2 907,6 935,7
Russia 100,3 82,0 90,9
Estonia 109,4 87,6 89,8
Lithuania 106,7 0,0 0,0
Eliminations -55,9 -38,6 -33,6
Total 1212,8 1038,8 1082,7
--------------------------------------------------------------
EPRA EARNINGS
Technopolis presents its official financial statements by applying the IFRS
standards. The statement of comprehensive income includes a number of items
unrelated to the company's actual business operations. Therefore, the company
presents its direct result, which better reflects its real result.
The direct result presents the company's net result for the period excluding
the change in the fair value of investment properties, the change in the fair
value of financial instruments, unrealized exchange rate gains and losses and
any non-recurring items, such as gains and losses on disposals. Additionally,
the statement of comprehensive income showing the direct result presents the
related taxes, deferred tax assets and liabilities and share of non-controlling
interests.
Items excluded from the direct result and their tax effects and share of
non-controlling interests are presented in the statement of income showing the
indirect result.
Technopolis Group
DIRECT RESULT 7-9/ 7-9/ 1-9/ 1-9/ 1-12/
Currency unit: EUR million 2013 2012 2013 2012 2012
--------------------------------------------------------------------------------
Net sales 30,8 26,6 91,6 78,7 107,3
Other operating income 0,2 0,2 1,1 0,8 1,3
Other operating expenses -13,8 -12, -45,6 -39,4 -53,3
5
Depreciation -0,7 -0,5 -2,0 -1,5 -2,0
--------------------------------------------------------------------------------
Operating profit/loss 16,4 13,8 45,2 38,6 53,3
Finance income and expenses, total -4,8 -3,7 -10,7 -10,7 -13,0
--------------------------------------------------------------------------------
Result before taxes 11,6 10,1 34,5 27,9 40,3
Taxes for direct result items -0,4 -2,4 -4,2 -6,7 -9,2
Non-controlling interests -0,4 -0,3 -1,0 -1,4 -1,2
--------------------------------------------------------------------------------
Direct result for the period 10,8 7,3 29,3 19,8 29,9
INDIRECT RESULT
Non-recurring items 0,0 0,1 0,1 0,2 0,4
Change in fair value of investment -6,5 0,2 -13,0 -6,0 -5,7
properties
--------------------------------------------------------------------------------
Operating profit/loss -6,5 0,3 -12,9 -5,8 -5,3
Change in fair value of financial -0,1 1,3 -4,3 1,2 -0,5
instruments
--------------------------------------------------------------------------------
Result before taxes -6,7 1,6 -17,2 -4,6 -5,8
Taxes for indirect result items 0,6 0,0 2,5 1,9 1,7
Non-controlling interests -0,2 -0,4 0,1
--------------------------------------------------------------------------------
Indirect result for the period -6,4 1,6 -15,2 -2,7 -4,0
Result for the period to the parent 4,5 8,9 14,2 17,1 25,8
company shareholders, total
Earnings per share, diluted
From direct result 0,14 0,11 0,39 0,29 0,43
From indirect result -0,08 0,02 -0,20 -0,04 -0,06
--------------------------------------------------------------------------------
From net result for the period 0,06 0,13 0,19 0,25 0,37
Effect of the interest expenses from -0,01 -0,03
equity related bond
--------------------------------------------------------------------------------
From adjusted net result for the period 0,04 0,13 0,16 0,25 0,37
KEY INDICATORS 1-9/ 1-9/ 1-12/
2013 2012 2012
--------------------------------------------------------------------------------
Change in net sales, % 16,5 15,7 15,6
Operating profit/loss/net sales, % 35,2 41,8 44,8
Interest coverage ratio 5,6 4,0 4,5
Equity ratio, % 39,4 36,9 36,2
Loan to value, % 57,2 59,5 59,5
Group company personnel during the period, 185 177 178
average
Gross expenditure on assets, MEUR 149,8 69,5 115,8
Net rental yield of investment properties, % 7,6 7,8 7,8
4)
Financial occupancy rate, % 5) 92,0 94,8 95,3
Earnings/share
basic, EUR 0,16 0,25 0,37
diluted, EUR 0,16 0,25 0,37
Cash flows from operating activities/share, 0,42 0,36 0,56
EUR
Equity/share, EUR 5,00 4,83 4,94
Average issue-adjusted number of shares
basic 75.742.0 68.018.931 69.913.84
94 1
diluted 75.939.3 68.251.700 70.146.31
92 8
Issue-adjusted number of shares at the end of 75.901.8 75.555.227 75.561.22
period 34 7
4) The figure does not include properties commissioned and acquired
during the fiscal year.
5) The figure does not include spaces under renovation that are non-leasable.
SPACE AND SERVICE BUSINESS 7-9/ 7-9/ 1-9/ 1-9/ 1-12/
2013 2012 2013 2012 2012
--------------------------------------------------------------------------------
Space
Net sales 27,5 23,2 81,0 68,4 93,0
Other operating income 0,0 0,1 0,1 0,2 0,3
Expenses for properties -8,0 -6,6 -25,9 -20,3 -27,2
Allocated sales, group and administration -1,1 -0,9 -3,5 -3,0 -4,3
expenses
EBITDA 18,4 15,9 51,7 45,3 61,9
EBITDA % 67,1 68,4 63,8 66,2 66,5
--------------------------------------------------------------------------------
Services
Net sales 3,3 3,3 10,7 10,2 14,2
Other operating income 0,1 0,2 1,1 0,8 1,3
Expenses -2,7 -2,8 -9,3 -8,4 -12,0
Allocated sales, group and administration -0,4 -0,4 -1,3 -1,6 -2,1
expenses
EBITDA 0,3 0,3 1,3 0,9 1,3
EBITDA % 8,5 8,6 12,2 9,1 9,4
--------------------------------------------------------------------------------
7-9/ 7-9/ 1-9/ 1-9/ 1-12/
CHANGE IN VALUE OF INVESTMENT PROPERTIES 2013 2012 2013 2012 2012
--------------------------------------------------------------------------------
Change in fair value, Finland -9,3 -1,7 -19,7 -11,8 -6,3
Change in fair value, Russia 2,9 0,0 4,3 1,2 1,6
Change in fair value, Estonia 0,2 -0,1 -0,5 0,5 0,0
Change in fair value, Lithuan 0,9 0,0 0,9 0,0 0,0
--------------------------------------------------------------------------------
Change in fair value -5,3 -1,7 -15,1 -10,1 -4,7
Changes in acquisition costs of -0,3 -0,2 -0,7 -3,4 -10,7
investment properties in financial year
Changes in fair value of projects in -0,9 2,1 2,8 7,5 9,7
progress
--------------------------------------------------------------------------------
Effect on profit of change in value of -6,5 0,2 -13,0 -6,0 -5,7
investment properties
CHANGE IN VALUE OF 7-9/ 7-9/ 1-9/ 1-9/ 1-12/
INVESTMENT PROPERTIES 2013 2012 2013 2012 2012
--------------------------------------------------------------------------------
Change in fair value, Finland -9,3 -1,7 -19,7 -11,8 -6,3
Change in fair value, Russia 2,9 0,0 4,3 1,2 1,6
Change in fair value, Estonia 0,2 -0,1 -0,5 0,5 0,0
Change in fair value, Lithuan 0,9 0,0 0,9 0,0 0,0
--------------------------------------------------------------------------------
Change in fair value -5,3 -1,7 -15,1 -10,1 -4,7
Changes in acquisition costs of -0,3 -0,2 -0,7 -3,4 -10,7
investment properties in financial year
Changes in fair value of projects in -0,9 2,1 2,8 7,5 9,7
progress
--------------------------------------------------------------------------------
Effect on profit of change in value of -6,5 0,2 -13,0 -6,0 -5,7
investment properties
BREAKDOWN OF FINANCIAL ASSETS AND LIABILITIES September 30, 2013
The following table provides a list of the groups of financial assets and
liabilities used for valuation in accordance with IAS 39.
Loans Available-f Financia Financia
and or-sale l l
other financial liabilit assets/l
receiva assets ies iabiliti
bles measured es,
at total
amortize
d
purchase
price
Non-current financial assets
Available-for-sale investments 5,8 5,8
Other non-current receivables 2,0 2,0
Total 2,0 5,8 7,8
Current assets
Trade and other receivables 19,6 19,6
Total 19,6 19,6
Non-current liabilities 0,0 0,0
Non-current finance lease liabilities 34,3 34,3
Non-current interest-bearing 493,8 493,8
liabilities
Non-current non-interest-bearing 4,2 4,2
liabilities
Total 532,3 532,3
Current liabilities
Current finance lease liabilities 2,4 2,4
Other current interest-bearing 127,8 127,8
liabilities
Trade and other payables 35,2 35,2
Income tax liability 0,8 0,8
Total 166,2 166,2
Fair value hierarchy of assets and liabilities measured at fair value
Level 1 Level Level Total
2 3
Assets measured at fair value
Derivatives
Interest rate swaps, meeting the criteria 0,6 0,6
for hedge accounting
Available-for-sale financial assets
Equity investments, measured at acquisition 1,7 1,7
cost
Equity investments, measured at fair value 1,1 2,9 4,1
Total 1,1 0,6 4,6 6,4
Liabilities measured at fair value
Financial liabilities at fair value through
profit or loss
Derivatives
Interest rate swaps, meeting the criteria 6,6 6,6
for hedge accounting
Total 6,6 6,6
Distrubution:
NASDAQ OMX Helsinki
Main news media
www.technopolis.fi
© 2024 Nasdaq, Inc. All Rights Reserved |