2011-02-24 12:39:58 CET
2011-02-24 12:40:59 CET
REGULATED INFORMATION
Olvi Oyj - Financial Statement Release
Olvi Group's performance and growth were excellent
Iisalmi, 2011-02-24 12:39 CET (GLOBE NEWSWIRE) -- OLVI PLC
FINANCIAL STATEMENTS BULLETIN 24 FEB 2011
OLVI GROUP FINANCIAL STATEMENTS JANUARY TO DECEMBER 2010
Olvi Group's performance and growth were excellent. The sales volume, net sales
and comparable operating profit increased in all of the Group's geographical
areas.
January-December in brief:
-- Olvi Group's sales volume increased by 12.6 percent to 472 (419) million
litres
-- Consolidated net sales increased by 9.6 percent to 267.5 (244.2) million
euro
-- Consolidated operating profit increased by 9.8 percent to 30.5 (27.8)
million euro
-- The business in Belarus has developed well. The investment programme has
begun as planned.
-- Olvi Group's earnings per share amounted to 2.41 (2.15) euro, and the Board
proposes a dividend of 1.00 (0.80) euro per share
-- The equity to total assets ratio increased to 54.7 (47.3) percent
KEY RATIOS
1-12/2010 1-12/2009 Change %
Net sales, MEUR 267.5 244.2 +9.6
Operating profit, MEUR 30.5 27.8 +9.8
Gross capital expenditure, MEUR 24.5 48.4 -49.4
Earnings per share, EUR 2.41 2.15 +12.1
Equity per share, EUR 12.25 10.56 +16.0
Equity to total assets, % 54.7 47.3
Gearing, % 29.5 48.0
Lasse Aho, Managing Director of Olvi plc, says the following with regard to the
financial statements: “Olvi Group's performance and growth in 2010 were
excellent. Our overall market position strengthened across our entire operating
area, and Olvi Group's financial position and liquidity improved further.
Comparable operating profit improved substantially. This was attributable to
good reliability of deliveries made possible by more efficient production
operations, successful new products launched in profitable product groups
during the year, as well as the exceptionally good weather last summer, which
had a particular effect on sales growth in mineral waters, soft drinks, juices
and cider.”
OLVI GROUP'S SALES VOLUME, NET SALES AND EARNINGS
January to December 2010
Olvi Group's sales volume in January-December 2010 amounted to 472 (419)
million litres. This represents an increase of 53 million litres or 12.6
percent. The sales volume increased in all operating areas and made the
all-time high
In January-December, sales in Finland increased by 7 million, in the Baltic
states by 29 million, and in Belarus by 24 million litres.
The Group's net sales from January to December amounted to 267.5 (244.2)
million euro. This represents an increase of 23.3 million euro or 9.6 percent.
Net sales increased in all of Olvi Group's operating areas thanks to the good
development in sales volume.
Net sales in Finland amounted to 111.0 (104.5) million euro. Net sales of the
Baltic subsidiaries amounted to 127.8 (119.9) million euro, while net sales in
Belarus amounted to 40.8 (30.3) million euro. The increase in net sales was 6.5
million euro or 6.2 percent in Finland, 7.9 million euro or 6.6 percent in the
Baltic states, and 10.5 million euro or 34.6 percent in Belarus.
Olvi Group's operating profit for January-December stood at 30.5 (27.8) million
euro, or 11.4 (11.4) percent of net sales. The operating profit improved by 2.7
million euro or 9.8 percent. The previous year's consolidated operating profit
included 3.2 million euro of non-recurring income arising from the recognition
of OAO Lidskoe Pivo's prescribed debts. The comparable consolidated operating
profit in 2010 improved by 5.9 million euro or 24.3 percent. All Olvi Group
companies posted a clearly better comparable operating profit in relation to
2009.
Operating profit in Finland increased by 2.1 million euro to 11.7 (9.6) million
euro. The operating profit in Finland includes 0.6 million euro of sales gains
on decommissioned production equipment and 0.6 million euro of costs due to the
scrapping of non-marketable packaging materials.
Operating profit in the Baltic states increased by 2.9 million euro to 15.0
(12.1) million euro. Operating profit in Belarus diminished by 1.4 million euro
to 4.4 (5.8) million euro. Comparable operating profit in Belarus between
January and December 2009, excluding non-recurring gains from the recognition
of prescribed debts, amounted to 2.6 million euro. This means that the
accumulated operating profit for the year 2010 in Belarus improved by 1.8
million euro in relation to the comparable operating profit in 2009.
The Group's profit after taxes in the period under review was 25.3 (23.0)
million euro. Earnings per share calculated from the profit belonging to parent
company shareholders was 2.41 (2.15) euro in January-December.
October to December 2010
The sales volume in October-December was 107 (93) million litres. This
represents an increase of 14 million litres or 14.6 percent. The sales volume
increased across all of Olvi Group's operating areas.
Sales in Finland increased by 3 million litres to 34 (31) million litres, and
sales in the Baltic states increased by 6 million litres to 53 (47) million
litres. Sales in Belarus improved substantially, showing an increase of 6
million litres and arriving at 24 (18) million litres. Intra-Group sales
declined by 2 million litres in the fourth quarter.
Olvi Group's net sales in October-December amounted to 61.4 (52.5) million
euro. Net sales improved by 8.9 million euro or 17.0 percent. Net sales in
Finland improved by 2.5 million euro to 27.1 (24.6) million euro, an increase
of 10.3 percent. Net sales in the Baltic states amounted to 26.9 (23.8) million
euro, an increase of 3.1 million euro or 13.2 percent. Net sales in Belarus
improved substantially thanks to the growth in sales volume. Net sales in
Belarus amounted to 9.6 (5.5) million euro, representing an increase of 4.1
million euro or 73.3 percent.
Consolidated operating profit in the fourth quarter stood at 2.8 (3.2) million
euro, which was 4.6 (6.2) percent of net sales. The operating profit diminished
by 0.4 million euro or 13.7 percent. The previous year's fourth-quarter
operating profit included 2.1 million euro of non-recurring income arising from
the recognition of OAO Lidskoe Pivo's prescribed debts. In relation to the
previous year's comparable operating profit, the operating profit for
October-December 2010 increased by 1.6 million euro.
The operating profit in Finland declined by 0.1 million euro. The operating
profit for the period under review included 0.6 million euro of costs arising
from the scrapping of non-marketable packaging materials. The operating profit
in the Baltic states improved by 1.4 million euro. The operating profit in
Belarus amounted to -0.1 (1.6) million euro, representing a decrease of 1.7
million euro. In relation to the comparable operating profit for 2009, the
operating profit in Belarus improved by 0.3 million euro.
SALES VOLUME, NET SALES AND EARNINGS BY GEOGRAPHICAL SEGMENTS
Seasonal nature of the operations
The Group's business is characterised by seasonal variation. The net sales and
operating profit from the reporting geographical segments are not accumulated
evenly but vary by seasons, prevailing weather and environmental conditions and
the individual characteristics of each segment.
PARENT COMPANY OLVI PLC (Olvi)
January to December 2010
According to statistics by the Federation of the Brewing and Soft Drinks
Industry, the Finnish beverage market diminished by approximately 3 percent in
January-December compared to the previous year. The sales decline was -5.7
percent in beers and -5.4 percent in ciders. In long drinks, the decline was
-2.3 percent, and in soft drinks -1.5 percent. Thanks to the record-breaking
warm summer weather, the sales of mineral waters increased by more than 10
percent. The statistics by the Federation of the Brewing and Soft Drinks
Industry only include data for the largest brewing companies. They do not
include the sales of private label products nor imports from abroad, which
means that the statistical data is imperfect in this sense.
With the exception of soft drinks, Olvi's sales improved in all product groups.
Olvi's sales volume in January-December was 137 (130) million litres. This
represents an increase of 7 million litres or 5.5 percent.
In 2010, the sales of ciders improved by 30 percent and the sales of long
drinks by 18 percent. The sales of ciders were boosted by the Olvi brand ciders
that were well-received in the market. Olvi Cranberry Long Drink and Olvi Gold
Long Drink continue to enjoy great success in the market.
The sales of beers increased by 4 percent and the sales of mineral waters by 21
percent, while the sales of soft drinks declined on the previous year. The
sales of mineral waters increased particularly thanks to the warm and sunny
weather extending to the late summer and autumn.
According to the statistics by the Federation of the Brewing and Soft Drinks
Industry, Olvi's overall market share increased during 2010. At the end of the
period under review, Olvi's market share in beers was 24 (22) percent. In
ciders and long drinks, it was 23 (19) percent, in mineral waters 23 (18)
percent and in soft drinks 4 (5) percent on average.
Olvi's exports and tax-free sales in 2010 amounted to 4 (5) million litres.
Thanks to the increase in sales volumes, Olvi's net sales in 2010 increased to
111.0 (104.5) million euro, an increase of 6.5 million euro or 6.2 percent.
Olvi's operating profit improved substantially. Operating profit in
January-December stood at 11.7 (9.6) million euro, which was 10.5 (9.2) percent
of net sales. The operating profit improved by 2.1 million euro or 22.0
percent. The improved profitability was enabled by more efficient operations,
increased production capacity, cost efficiency and successful novel products in
the beer, long drink and cider segments. The operating profit includes 0.6
million euro of sales gains on decommissioned production equipment and 1.2
million euro of costs due to the scrapping of non-marketable packaging
materials.
October to December 2010
Olvi's sales in the fourth quarter amounted to 34 (31) million litres,
representing an increase of 3 million litres or 11.4 percent. Net sales
improved by 2.5 million euro or 10.3 percent to 27.1 (24.6) million euro.
Operating profit in October—December was almost on a par with the previous year
at 0.9 (1.0) million euro. The costs of scrapping non-marketable packaging
materials, 0.6 million euro, are allocated entirely in the last quarter of the
year.
AS A. LE COQ (A. Le Coq)
January to December 2010
The Estonian subsidiary AS A. Le Coq's sales in January-December amounted to
125 (113) million litres. This represents an increase of 11 million litres or
10.1 percent.
The sales of beers increased by 9 percent and the sales of long drinks by 6
percent, while the sales of cider remained almost at the previous year's level.
A. Le Coq is the market leader in the Estonian beer market with an approximate
market share of 40 (40) percent (market shares from AC Nielsen's statistics for
October-November 2010).
A. Le Coq's market share in long drinks is 53 (60) percent and in ciders 47
(53) percent. A. Le Coq is the clear market leader in Estonia regarding both
long drinks and ciders.
Thanks to the warm summer weather, the sales of soft drinks increased
substantially by 18 percent, and the sales of ACE drinks increased by 12
percent. The sales of mineral waters were 3 percent higher than in the previous
year. The sales of juices remained on the previous year's level. The market
share in soft drinks at the end of November 2010 was 29 percent, and in mineral
waters 13 percent. A. Le Coq is the market leader in the sales of juices and
juice-based drinks, with a 22 percent market share in tetrapacks and 44 percent
in other packaging.
The company's exports and tax-free sales increased by 32.3 percent on the
previous year to 4 (3) million litres.
The company's net sales in 2010 amounted to 69.9 (65.2) million euro,
representing an increase of 4.7 million euro or 7.3 percent.
The operating profit improved clearly by 1.7 million euro to 11.9 (10.2)
million euro, an increase of 17.2 percent. The operating profit represented
17.0 (15.6) percent of net sales. The increase in net sales was enabled by
cost-efficient production and the increase in sales volume.
October to December 2010
A. Le Coq's sales in the fourth quarter amounted to 27 (24) million litres, an
increase of 3 million litres or 9.9 percent on the previous year. Net sales
from October to December amounted to 14.9 (13.6) million euro. Net sales
improved by 1.3 million euro or 9.6 percent.
The company's fourth-quarter operating profit stood at 2.0 (1.3) million euro,
representing an increase of 0.7 million euro or 57.1 percent.
A/S CESU ALUS (Cesu Alus)
January to December 2010
From January to December, the sales of A/S Cesu Alus operating in Latvia
totalled 69 (59) million litres. This represents an increase of 10 million
litres or 16.6 percent. The sales of beers increased by 17 percent and the
sales of soft drinks by 49 percent. The sales of ciders and long drinks
declined by 9 percent as the total market diminished.
Cesu Alus's market share in the Latvian beer market is 32 (33) percent (AC
Nielsen statistics for December 2010), in the cider market 56 (45) percent and
in the long drink market 45 (41) percent (AC Nielsen statistics for
October-November 2010). Cesu Alus is the clear market leader in ciders. In
beers and long drinks, Cesu Alus has a strong hold on the number two position.
The company's market shares in ciders and long drinks strengthened in spite of
the declined sales volume.
The company's net sales from January to December amounted to 31.4 (30.0)
million euro, representing an increase of 1.4 million euro or 4.7 percent. The
increase in net sales fell clearly short of the increase in sales volume due to
the decline in mean price contributing to net sales, which in turn was affected
by the shift towards less expensive products due to the country's financial
depression.
The operating profit for 2010 stood at 1.7 (1.0) million euro, which was 5.5
(3.4) percent of net sales. The operating profit improved by 0.7 million euro.
The improvement in operating profit was clearly attributable to the third
quarter. The improvement in operating profit was enabled by increased sales
volumes, improved operating efficiency and savings in the costs of materials,
logistics and other operating expenses.
October to December 2010
Cesu Alus's sales in the fourth quarter amounted to 14 (12) million litres,
representing an increase of 2 million litres or 15.6 percent. Net sales
improved by 0.8 million euro or 15.7 percent to 6.0 (5.2) million euro.
Compared to the previous year, the company's operating profit improved by 0.2
million euro.
AB RAGUTIS (Ragutis)
January to December 2010
The January-December sales volume of Ragutis operating in Lithuania increased
by 7 million litres to 59 (52) million litres, an increase of 14.2 percent. The
sales of beer and long drinks increased by 12 percent, while the sales of
ciders increased by 7 percent on the previous year. The sales increase in soft
drinks was as high as 21 percent, thanks to the warm summer weather and
particularly to the good sales development of kvass, which belongs to the soft
drinks segment.
The company's overall position in the Lithuanian beverage market has
strengthened. The company's market share in beers is approximately 13 (10)
percent. The company is a clear market leader in ciders and long drinks, with
market shares of 48 (33) percent in ciders and 40 (42) percent in long drinks.
The company is also a market leader in the kvass market with a market share of
34 (30) percent. (Market shares from AC Nielsen statistics for October-November
2010)
The company's net sales from January to December amounted to 26.4 (24.6)
million euro, representing an increase of 1.8 million euro or 7.0 percent.
Compared to the previous year, the increase in net sales fell short of the
increase in sales volume due to a slightly lower average price.
The company's operating profit in 2010 improved by 0.5 million euro. The
operating profit stood at 1.4 (0.9) million euro, which was 5.4 (3.7) percent
of net sales. The operating profit improved thanks to the increase in sales
volume.
October to December 2010
Ragutis's sales volume in October-December was 13 (11) million litres. This
represents an increase of 2 million litres or 18.9 percent.
The company's fourth-quarter 2010 net sales stood at 5.9 (4.9) million euro,
representing an increase of 1.0 million euro or 20.6 percent.
The company's operating profit declined by 0.4 million euro.
OAO LIDSKOE PIVO (Lidskoe Pivo)
January to December 2010
The operations of Lidskoe Pivo in Belarus developed very well in 2010
The company's sales volume in 2010 amounted to 111 (87) million litres,
representing an increase of 24 million litres or 27.3 percent. The sales of
beers increased by 17 percent, soft drinks and kvass by 41 percent, mineral
waters by 35 percent and long drinks by 4 percent. The sales of juices and
juice-based drinks improved substantially during the year, by 65 percent.
Lidskoe Pivo is the Belarusian market leader in kvass with a market share of 59
(52) percent. The brewery's market share has increased in both beers and long
drinks. Lidskoe Pivo's market share in beers in 2010 was 10 (8) percent, and in
long drinks 29 (22) percent. The company's market share in soft drinks was on a
par with the previous year, 5 percent in soft drinks and 2 percent in waters.
(Market shares according to AC Nielsen December 2010.)
The company's exports increased by 3 million litres to 6 (3) million litres, an
increase of 122.4 percent.
The company's net sales in 2010 increased substantially by 10.5 million euro or
34.6 percent to 40.8 (30.3) million euro. The growth in net sales was enabled
by the good development of sales volumes and a slightly better average price
compared to the previous year.
Lidskoe Pivo's operating profit for January-December stood at 4.4 (5.8) million
euro, or 10.9 (19.1) percent of net sales. The operating profit declined by 1.4
million euro or 23.3 percent compared to the previous year. In 2009, the
company's operating profit included non-recurring income of 3.2 million euro
due to prescribed debts. In relation to the comparable operating profit for
2009, the operating profit for 2010 increased by 1.8 million euro or 69
percent.
October to December 2010
Lidskoe Pivo's sales in the fourth quarter amounted to 24 (18) million litres,
representing an increase of 6 million litres or 29.9 percent.
The company's net sales improved by 4.1 million euro or 73.3 percent to 9.6
(5.5) million euro.
Lidskoe Pivo's operating result in October-December showed a loss of -0.1 (1.6)
million euro, a decline of 1.7 million euro or 108.4 percent. Lidskoe Pivo's
fourth-quarter operating profit in 2009 included 2.1 million euro of
non-recurring income arising from the recognition of prescribed debts.
Comparable operating profit in October-December 2009 was -0.5 million euro. The
operating profit in the fourth quarter of 2010 improved by 0.3 million euro or
71.9 percent in relation to the comparable operating profit in 2009.
FINANCING AND INVESTMENTS
Olvi Group's balance sheet total at the end of December 2010 was 236.1 (237.2)
million euro. Equity per share at the end of 2010 stood at 12.25 (10.56) euro,
an increase of 1.69 euro per share or 16.0 percent. The equity to total assets
ratio outperformed Olvi Group's long-term target of 50 percent. The actual
figure at the end of December was 54.7 (47.3) percent, a substantial
improvement of 7.4 percentage points compared to the previous year. The gearing
ratio also declined from 48.0 percent to 29.5 percent. The current ratio,
representing liquidity, was 1.3 (1.1).
The amount of interest-bearing liabilities at the end of 2010 was 46.1 (62.3)
million euro, including current liabilities of 8.7 (26.2) million euro.
Olvi Group's gross capital expenditure in 2010 amounted to 24.5 (48.4) million
euro. 4.8 million euro of the capital expenditure was attributable to the
parent company Olvi, in addition to which the company spent 0.5 million euro on
increasing its holding in Lidskoe Pivo. 4.2 million euro was attributable to
the Baltic subsidiaries and 15.0 million euro to OAO Lidskoe Pivo. The capital
expenditure was spent on increasing production and storage capacity.
The largest investments in Finland in 2010 were the labelling, cardboard
packaging and wrapping machines and the development of logistics within the
warehouse. The largest investments in the Baltic states were the new glass and
PET bottle formats, a yeast separator and a screw-cap machine for the tetrapack
line at A. Le Coq, a new filling, labelling and capping machine, a new bottle
format and an air compressor for Cesu Alus, extensions to the fermentation tank
and waste yeast cellars as well as water treatment systems for the boiling room
at Ragutis. In Belarus, the construction of a new warehouse and filling lines
was started, as well as extensions to the tank cellar and filtering section.
Cooling equipment was also modernised. The projects will be completed during
the spring of 2011.
PRODUCT DEVELOPMENT AND NEW PRODUCTS
Research and development includes projects to design and develop new products,
packages, processes and production methods, as well as further development of
existing products and packages. The R&D costs have been recognised as expenses.
The main objective of Olvi Group's product development is to create new
products for profitable and growing beverage segments.
Finland, parent company Olvi
OLVI Lonkero is the best-selling brand of long drinks in retail sales (Nielsen
HomeScan). In January 2011, OLVI Lonkero also entered the mild long drink
segment with OLVI Mild Grapefruit in 0.5 L bottles (alc. 2.6% vol.).
Subsidiaries
The Estonian A. Le Coq launched the main product of the Belarusian Lidskoe Pivo
brewery, Lidskoe Premium, in 0.5-litre cans. Mixers became a totally new
category for Olvi Group. A. Le Coq created a new brand called Royal Club. Royal
Club Tonic, Bitter Lemon, Soda Water and Ginger Ale are packaged in 0.33-litre
cans. The market-leading juice brand Aura was expanded with new 2-litre
packages.
In January, Cesu Alus of Latvia launched the Cesu 14 Red Russian ready-to-drink
alcoholic cocktail in 0.28-litre bottles. The soft drink Lemonade was launched
in 0.33-litre cans. Latvia's best-selling energy drink Dynamite will be
supplemented by Dynami:t Blue, a version with more coffeine, in 0.5-litre
plastic bottles in February.
Ragutis of Lithuania will launch the main product of the Belarusian Lidskoe
Pivo brewery, Lidskoe Premium, in 0.5-litre cans in February 2011.
The Belarusian brewery Lidskoe Pivo launched the FIZZ cider brand. The product
is available as apple and pear versions in 1-litre and 1.5-litre plastic
bottles. Until this, there was only one brand of cider available in the
Belarusian market, so excellent growth and demand can be expected for FIZZ.
PERSONNEL
Olvi Group's personnel in January-December averaged 2,051 (2,076) people. The
Group's average number of personnel decreased by 25 people or 1.2 percent. The
total number of personnel at the end of December 2010 was 1,973 (1,997).
Olvi Group's average number of personnel by country
Finland 378 (377)
Estonia 312 (337)
Latvia 207 (206)
Lithuania 195 (195)
Belarus 959 (961)
Total 2,051(2,076)
CHANGES IN CORPORATE STRUCTURE IN 2010
In July 2010, Olvi increased its holding in the Belarusian brewery Lidskoe Pivo
from 87.84 percent to 91.58 percent. During the year, Olvi's holding in the
Latvian company Cesu Alus increased from 99.30 percent to 99.37 percent. Olvi's
holding in A. Le Coq is 100.00 percent and in Ragutis 99.57 percent.
THE OLVI SERIES A SHARE AND MARKET
Olvi's share capital at the end of December 2010 was 20.8 million euro. The
total number of shares was 10,379,404. Of the total, 8,513,276 shares or 82.0
percent belonged to Series A, while 1,866,128 shares or 18.0 percent belonged
to Series K. Each Series A share carries one (1) vote, while each Series K
share carries twenty (20) votes. The Series A and Series K shares have an equal
right to dividends.
The trading price for Olvi A shares on Nasdaq OMX Helsinki (Helsinki Exchange)
at the end of 2010 was 30.70 euro (26.49 at the end of 2009). The highest quote
for Series A shares in January-December 2010 was 31.45 euro and the lowest
quote was 24.01 euro. The average price was 28.05 euro (19.29 in 2009).
At the end of 2010, the market value of Series A shares was 261.4 (225.5)
million euro, and the market value of all shares was 318.6 (275.0) million
euro. The trading volume of Series A shares in January-December 2010 was
1,628,258 (2,223,423) shares.
Olvi had 8,089 shareholders at the end of December 2010. The amount of foreign
holdings plus foreign and Finnish nominee-registered holdings was 18.9 percent
of the total number of book entries and 6.4 percent of total votes.
Foreign and nominee-registered holdings are accounted for in Table 7, Note 9 of
the tables attached to this financial statements bulletin, and the largest
shareholders are listed in Table 7, Note 10.
SHARE-BASED INCENTIVE SCHEMES
Olvi's Board of Directors has decided on a share-based incentive scheme for
Olvi Group's key personnel on 26 January 2006. A detailed description of the
scheme can be found in Table 5, Note 5.
TREASURY SHARES
There were no changes in the number of treasury shares held by Olvi during
2010. At the end of December 2010, Olvi held 12,400 Series A shares as treasury
shares. Treasury shares held by Olvi plc are reported in the tables section of
the financial statements bulletin, in Table 5, Note 6.
STOCK EXCHANGE RELEASES AND FLAGGING NOTICES ISSUED IN 2010
In addition to the regular financial statements bulletin and interim reports,
Olvi issued a stock exchange release on 24 September 2010, upgrading its
earnings outlook for 2010. Olvi estimated that its full-year 2010 comparable
operating profit will be clearly better than in the previous year. The
comparable operating profit in 2009 amounted to 24.5 million euro. The company
previously estimated that the comparable operating profit for 2010 would be on
a par with 2009.
Olvi received no flagging notices in 2010.
RISK MANAGEMENT
Olvi Group is exposed to risks that may be due to the operations of Group
companies or changes in the business environment.
The Group's risk management is an essential part of business management and
everyday operations. The objective of risk management is to ensure the
fulfilment of corporate strategy and business continuity. Olvi Group
identifies, assesses, manages, monitors and reports essential risks regularly.
With regard to identified risks, the effects, extent and probability of the
realisation of risk are assessed together with means to eliminate or reduce the
risk.
In addition to this, risk management aims to identify and exploit opportunities
arising in business operations.
Olvi operates internationally, and its business involves risks due to exchange
rate fluctuations arising from the cash flows of purchases and sales, as well
as the conversion of balance sheet items in foreign subsidiaries into euro.
Olvi Group's parent company manages financing and exchange rate risks centrally
in accordance with guidelines from the Board of Directors.
Olvi's operations are dependent on the reliability of materials management,
production facilities, logistics and IT systems. The Group aims to prevent the
realisation of associated risks through continuous analysis and development of
processes. Olvi Group companies are prepared for property losses and business
interruptions through insurance policies, the coverage of which is reviewed
annually.
BUSINESS RISKS AND UNCERTAINTIES IN THE NEAR TERM
The upturn in the Baltic states' economy may change to a new decline, which
would contribute the decline in the overall beverage market in these countries.
Weakened consumer purchasing power would result in a decrease in demand for
more expensive products and guide it to a lower price bracket, which would mean
a decline in the net sales and profitability of companies operating in the
area.
A decline in the financial situation may affect customers' solvency and the
schedule of payments and lead to credit losses. The control of accounts
receivable has been intensified to prevent credit loss risks. On the other
hand, the risk of credit losses is reduced through the fact that Olvi Group's
customer base is wide and distributed across several countries.
Consumer confidence in economic development and the persistently low level of
interest rates will stabilise the outlook for consumer demand in Finland.
However, increases in all kinds of tax rates and increasing regulation of
operations, together with the effects of potential disturbances in the
financial market, create substantial uncertainty in financial development.
The operations in Belarus involve country-based risks: The unforeseeable nature
of government activities and rapid changes in laws, their interpretation and
application may make business difficult and slow down the completion and
utilisation of investments in the country. Also the economic situation of the
country of Belarus may turn to the worse, which would weaken the growth
opportunities of Lidskoe Pivo and impact its profitability.
NEAR-TERM OUTLOOK
Olvi Group has a good starting position for 2011. Profitability is estimated to
remain at the healthy level of 2010.
BOARD OF DIRECTORS' PROPOSAL FOR THE DISTRIBUTION OF PROFIT
Olvi plc's dividend policy is active and earnings-based.
The parent company Olvi plc had 39.7 (40.5) million euro of distributable funds
on 31 December 2010, of which profit for the period accounted for 7.5 (6.0)
million euro.
Olvi plc's Board of Directors proposes to the Annual General Meeting that
distributable funds be used as follows:
1) A dividend of 1.00 euro shall be paid for 2010 on each Series K and Series A
share, totalling 10.4 (8.3) million euro. The dividend represents 41.5 (37.2)
percent of Olvi Group's earnings per share. Dividends shall be paid to
shareholders registered in Olvi plc's register of shareholders maintained by
Euroclear Finland Oy on the record date of 12 April 2011. It is proposed that
the dividend be paid on 19 April 2011.
2) 29.3 million euro shall be retained in the parent company's non-restricted
equity.
ANNUAL SUMMARY
An annual summary of disclosures made by the company in 2010 can be found at
www.olvi.fi under “Financial reports”
FINANCIAL REPORTS IN 2011
Olvi Group's financial statements, operating report and corporate governance
statement for 2010 will be published on 17 March 2011. A notice to convene Olvi
plc's Annual General Meeting, which will be held on 7 April 2011 in Iisalmi,
will be published on 17 March 2011. The financial statements, operating report
and notice to convene the AGM will be available on Olvi plc's Web site on the
same day.
The following interim reports will be released in 2011:
-- Interim Report for January-March on 28 April 2011
-- Interim Report for January-June on 11 August 2011
-- Interim Report for January-September on 27 October 2011
Further information:
Lasse Aho, Managing Director, phone +358 17 838 5200 or +358 400 203 600
OLVI PLC
Board of Directors
TABLES
- Statement of comprehensive income, Table 1
- Balance sheet, Table 2
- Changes in shareholders' equity, Table 3
- Cash flow statement, Table 4
- Notes to the financial statements, Table 5
DISTRIBUTION:
NASDAQ OMX Helsinki Ltd
Key media
www.olvi.fi
OLVI GROUP TABLE 1
INCOME STATEMENT
EUR 1,000
10-12/ 10-12/ 1-12/ 1-12/
2010 2009 2010 2009
Net sales 61420 52518 267509 244165
Other operating income 325 2457 717 4348
Operating expenses -54252 -47403 -219101 -203219
Depreciation and impairment -4688 -4322 -18640 -17530
Operating profit 2805 3250 30485 27764
Financial income 246 168 514 2315
Financial expenses -168 -403 -1831 -3069
Financing costs - net 78 -235 -1317 -754
Earnings before tax 2883 3015 29168 27010
Taxes *) -192 -317 -3909 -4001
NET PROFIT FOR THE YEAR 2691 2698 25259 23009
Other comprehensive income items:
Translation differences related to foreign 604 -316 557 -6117
subsidiaries
TOTAL COMPREHENSIVE INCOME FOR THE YEAR 3295 2382 25816 16892
Distribution of profit:
- parent company shareholders 2689 2505 24954 22297
- minority 2 193 305 712
Distribution of comprehensive profit:
- parent company shareholders 3242 2437 25405 17467
- minority 53 -56 411 -575
Undiluted and diluted earnings per share
calculated from the profit belonging
to parent company shareholders:
- earnings per share, EUR 0.26 0.24 2.41 2.15
*) Taxes calculated from the profit for the review period.
The notes constitute an essential part of the financial statements.
OLVI GROUP TABLE 2
BALANCE SHEET
EUR 1,000
31.12.2010 31.12.2009
ASSETS
Non-current assets
Tangible assets 124857 125268
Goodwill 17169 17176
Other intangible assets 1134 953
Financial assets available for sale 545 288
Other non-current assets available for sale 333
Loan receivables and other non-current receivables 137 143
Deferred tax receivables 1682 909
Total non-current assets 145857 144737
Current assets
Inventories 35124 35355
Accounts receivable and other receivables 47270 48703
Liquid assets 7891 8402
Total current assets 90285 92460
TOTAL ASSETS 236142 237197
SHAREHOLDERS' EQUITY AND LIABILITIES
Shareholders' equity held by parent company shareholders
Share capital 20759 20759
Other reserves 1092 1092
Treasury shares -222 -222
Translation differences -4402 -4853
Retained earnings 109750 92746
126977 109522
Minority interest 2277 2764
Total shareholders' equity 129254 112286
Non-current liabilities
Loans 35607 36101
Other liabilities 1755 0
Deferred tax liabilities 1847 1581
Current liabilities
Loans 7578 26238
Accounts payable and other liabilities 60101 60991
Total liabilities 106888 124911
TOTAL SHAREHOLDERS' EQUITY AND LIABILITIES 236142 237197
The notes constitute an essential part of the financial statements.
OLVI GROUP TABLE 3
CHANGES IN OLVI GROUP'S CONSOLIDATED SHAREHOLDERS' EQUITY
Share Other Treasu Translati Accrue Minori
ry on d ty
EUR 1,000 capita reserv shares differenc earnin intere Total
l es e gs st
accoun
t
Shareholders' equity 20759 1092 -63 -23 72339 11618 105722
1 Jan 2009
Payment of dividends -5552 -5552
Acquisition of treasury -159 -159
shares
Earnings due to minority acquisition 3662 3662
Total comprehensive income for the year -4830 23009 -1287 16892
Share of profit belonging to the -712 712 0
minority
Change in minority interest -8279 -8279
Shareholders' equity 20759 1092 -222 -4853 92746 2764 112286
31 Dec 2009
Share Other Treasu Translati Accrue Minori
ry on d ty
EUR 1,000 capita reserv shares differenc earnin intere Total
l es e gs st
Share capital 1 Jan 20759 1092 -222 -4853 92746 2764 112286
2010
Payment of dividends -8345 -8345
Earnings due to minority acquisition 395 395
Total comprehensive income for the 451 25259 106 25816
year
Share of profit belonging to the -305 305 0
minority
Change in minority interest -898 -898
Shareholders' equity 20759 1092 -222 -4402 109750 2277 129254
31 Dec 2010
Other reserves include the share premium account, legal reserve and
other reserves.
The notes constitute an essential part of the financial statements.
OLVI GROUP TABLE 4
CASH FLOW STATEMENT
EUR 1,000
1-12/201 1-12/200
0 9
Net profit for the period 25259 23009
Adjustments to profit for the period 22253 20697
Change in net working capital -1489 -2351
Interest paid -1848 -3538
Interest received 514 663
Taxes paid -2767 -3014
Cash flow from operations (A) 41922 35466
Investments in tangible assets -17419 -17457
Investments in intangible assets -522 -265
Capital gains on disposal of tangible and intangible assets 376 345
Expenditure on other investments -257 -2
Cash flow from investments (B) -17822 -17379
Increase of share capital 0 0
Withdrawals of loans 25000 20912
Repayments of loans -41288 -40774
Acquisition of treasury shares 0 -160
Increase (--)/decrease (+) in current interest-free business -2
receivables
Dividends paid -8321 -5411
Cash flow from financing (C) -24611 -25433
Increase (+)/decrease (--) in liquid assets (A+B+C) -511 -7346
Liquid assets 1 January 8402 15748
Liquid assets 31 December 7891 8402
Change in liquid assets -511 -7346
The notes constitute an essential part of the financial statements.
OLVI GROUP
TABLE 5
NOTES TO THE FINANCIAL STATEMENTS
The consolidated financial statements for 1 January to 31 December 2010 have
been prepared in compliance with the International Financial Reporting
Standards (IFRS), observing the IAS and IFRS standards as well as the official
SIC and IFRIC interpretations valid on 31 December 2010.
For its financial statements 2010, the company has observed the same accounting
policies as for its annual financial statements 2009, with the exception of
changes due to the following new and revised IFRS standards and IFRIC
interpretations:
- IFRS 2 (Amendment) Share-based Payment - Group Cash-settled Share-based
Payment Transactions and Application
- IFRS 5 (Amendment) Long-term Assets Held for Sale and Discontinued Operations
- IFRS 8 (Amendment) Operating Segments
- IAS 1 (Amendment) Presentation of Financial Statements
- IAS 7 (Amendment) Statement of Cash Flows
- IAS 17 (Amendment) Leases
- IAS 18 (Amendment) Revenue
- IAS 36 (Amendment) Impairment of Assets
- IAS 38 (Amendment) Intangible Assets
- IAS 39 (Amendment) Financial Instruments: Recognition and Measurement
- IFRIC 9 (Amendment) Reassessment of Embedded Derivatives
- IFRIC 16 (Amendment) Hedges of a Net Investment in a Foreign Operation
The above changes in standards and interpretations have no substantial effect
on the income statement, balance sheet or notes.
The information in the financial statements bulletin is presented in thousands
of euros (EUR 1000). For the sake of presentation, individual figures and
totals have been rounded to full thousands, which causes rounding differences
in additions. The ratios are calculated from exact euro amounts.
1. SEGMENT INFORMATION
SALES BY GEOGRAPHICAL SEGMENT (1,000 litres)
10-12/ 2010 10-12/ 2009 1-12/ 2010 1-12/ 2009
Olvi Group total 106615 92998 471913 419023
Finland 34261 30749 136832 129671
Estonia 26763 24356 124772 113362
Latvia 13557 11730 68705 58935
Lithuania 13115 11031 59075 51746
Belarus 23803 18327 111323 87453
- sales between segments -4884 -3195 -28794 -22144
NET SALES BY GEOGRAPHICAL SEGMENT (EUR 1,000)
10-12/ 10-12/ 1-12/ 1-12/
2010 2009 2010 2009
Olvi Group total 61420 52516 267509 244165
Finland 27155 24612 110989 104511
Estonia 14918 13606 69935 65194
Latvia 6065 5244 31448 30036
Lithuania 5933 4920 26379 24644
Belarus 9573 5523 40769 30288
- sales between segments -2224 -1389 -12011 -10508
OPERATING PROFIT BY GEOGRAPHICAL SEGMENT (EUR 1,000)
10-12/ 10-12/ 1-12/ 1-12/
2010 2009 2010 2009
Olvi Group total 2806 3249 30485 27763
Finland 913 993 11702 9596
Estonia 2027 1290 11905 10156
Latvia -8 -226 1714 1019
Lithuania -25 -450 1423 909
Belarus -133 1579 4444 5797
- eliminations 32 63 -703 286
2. PERSONNEL ON AVERAGE
1-12/2010 1-12/2009
Finland 378 377
Estonia 312 337
Latvia 207 206
Lithuania 195 195
Belarus 959 961
Total 2051 2076
3. RELATED PARTY TRANSACTIONS
Employee benefits to management
Salaries and other short-term employee benefits to the Board of Directors and
Managing Director
EUR 1,000
1-12/2010 1-12/2009
Managing Directors 668 620
Chairman of the Board 225 222
Other members of the Board 109 110
Total 1002 952
4. SHARES AND SHARE CAPITAL
31.12.2010
Number of A shares 8513276
Number of K shares 1866128
Total 10379404
Total votes carried by A shares 8513276
Total votes carried by K shares 37322560
Total number of votes 45835836
Registered share capital, EUR 1,000 20759
The Series A and Series K shares received a dividend of 0.80 euro per share for
2009 (0.50 euro per share for 2008), totalling 8.3 (5.2) million euro. The
dividends were paid on 20 April 2010.
Nominal value of A and K shares, euro 2.00
Votes per Series A share 1
Votes per Series K share 20
The shares entitle to equal dividend. The Articles of Association include a
redemption clause concerning Series K shares.
5. SHARE-BASED PAYMENTS
Olvi plc's Board of Directors decided on 26 January 2006 on a share-based
incentive scheme for Olvi Group's key personnel.
The share-based bonus scheme is a part of the incentive and commitment scheme
for the Group's key personnel and its purpose is to combine the objectives of
shareholders and key personnel to improve the company's value.
The scheme includes two vesting periods, the first one extending from 1 January
2006 to 31 December 2007 and the second one from 1 January 2008 to 31 December
2010. The amount of bonuses payable out of the scheme is linked to Olvi Group's
net sales and the operating profit percentage in relation to net sales.
The bonuses are payable partially in Olvi plc's Series A shares and partially
in cash. The proportion payable in cash covers the taxes and other statutory
fees arising from the share-based bonuses. The bonuses for the first vesting
period were paid in April 2008. The shares carried a ban on transferring them
within two years of reception.
The bonuses for the second vesting period will be paid in April 2011. 50
percent of the shares received as bonus for the second vesting period may be
transferred after one year of reception, and 100 percent after two years of
reception. The right to dividends begins when the shares are transferred to the
key employees' book-entry accounts.
On the basis of this incentive scheme, a total of 11,838 shares may become
payable in 2011 for the second vesting period. If the targets were achieved in
full, 48,000 Olvi plc Series A shares would have been paid out. In
January-December 2010, a total of 385 (195 in 2009) thousand euro of costs
related to the vesting period 2008-2010 were recognised as accrued expenses.
The target group of the scheme currently includes 20 key employees.
This incentive scheme has no dilution effect. Olvi Group has no warrants or
options.
6. TREASURY SHARES
Olvi plc held 12,400 of its own Series A shares on 1 January 2010. The total
purchase price was 222 thousand euro.
Olvi plc has not acquired more treasury shares nor transferred them to other
parties in January-December 2010, which means that the number of Series A
shares held as treasury shares remains the same on 31 December 2010.
Series A shares held by Olvi plc as treasury shares represent 0.12 percent of
the share capital and 0.03 percent of the aggregate number of votes. The
treasury shares represent 0.15 percent of all Series A shares and associated
votes.
On 8 April 2010, simultaneously cancelling any unused authorisations to acquire
treasury shares, the General Meeting of Shareholders of Olvi plc decided to
authorise the Board of Directors of Olvi plc to decide on the acquisition of
the company's own shares using distributable funds. The authorisation is valid
for one year starting from the General Meeting and covers a maximum of 245,000
Series A shares.
The Annual General Meeting also decided to revoke all existing unused
authorisations for the transfer of treasury shares and authorise the Board of
Directors of Olvi plc to decide on the transfer of any Series A shares acquired
on the company's own account within one year of the Annual General Meeting.
The Board of Directors of Olvi plc has not exercised the authorisations of
acquisition or transfer in January-December 2010.
7. NUMBER OF SHARES *) 1-12/2010 1-12/2009
- average 10367004 10371470
- at end of period 10367004 10367004
*) Treasury shares deducted.
8. TRADING OF SERIES A SHARES ON THE HELSINKI STOCK EXCHANGE
1-12/2010 1-12/2009
Trading volume of Olvi A shares 1628258 2223423
Total trading volume, EUR 1,000 45735 42445
Traded shares in proportion to
all Series A shares, % 19.1 26.1
Average share price, EUR 28.05 19.29
Price on the closing date, EUR 30.70 26.49
Highest quote, EUR 31.45 26.49
Lowest quote, EUR 24.01 12.80
9. FOREIGN AND NOMINEE-REGISTERED HOLDINGS ON 31 DECEMBER 2010
Book entries Votes Shareholders
qty % qty % qty %
Finnish total 8415976 81.08 42900672 93.60 8048 99.49
Foreign total 423315 4.08 1395051 3.04 36 0.45
Nominee-registered (foreign) 455 0.00 455 0.00 1 0.01
total
Nominee-registered (Finnish) 1539658 14.84 1539658 3.36 5 0.06
total
Total 10379404 100.00 45835836 100.00 8089 100.00
10. LARGEST SHAREHOLDERS ON 31 DECEMBER 2010 (by number of votes)
Series Series Total % Votes %
K A
1. Olvi Foundation 1181952 433486 1615438 15.56 24072526 52.52
2. Hortling Heikki Wilhelm 450712 87472 538184 5.19 9101712 19.86
*)
3. The Heirs of Hortling 93552 12624 106176 1.02 1883664 4.11
Kalle Einari
4. Hortling Timo Einari 82912 17304 100216 0.97 1675544 3.66
5. Hortling-Rinne Marit 51144 1050 52194 0.50 1023930 2.23
6. Skandinaviska Enskilda Banken, 810878 810878 7.81 810878 1.77
nominee reg.
7. Nordea Bank Finland plc, nominee 642471 642471 6.19 642471 1.40
register
8. Ilmarinen Mutual Pension 415000 415000 4.00 415000 0.91
Insurance Company
9. Autocarrera Oy Ab 223000 223000 2.15 223000 0.49
10. Kamprad Ingvar 212600 212600 2.05 212600 0.46
Others 5856 5657391 5663247 54.57 5774511 12.60
Total 1866128 8513276 10379404 100.00 45835836 100.00
*) The figures include the shareholder's own holdings and shares held by parties
in his control.
11. PROPERTY, PLANT AND EQUIPMENT
EUR 1,000
1-12/ 1-12/
2010 2009
Increase 23044 19116
Decrease -4405 -4267
Total 18639 14849
12. CONTINGENT LIABILITIES 1-12/2010 1-12/2009
EUR 1,000
Debts for which mortgages have been given as collateral
Loans from financial institutions
For own commitments 0 0
For others 0 0
Pledges and contingent liabilities
For own commitments 4453 6376
For others 810 810
Leasing liabilities:
Due within one year 748 642
Due within 1 to 5 years 672 515
Due in more than 5 years 0 0
Total leasing liabilities 1420 1157
Package liabilities 3648 3317
Other liabilities 1980 1980
13. CALCULATION OF FINANCIAL RATIOS
Equity to total assets, % = (Shareholders' equity held by parent company
shareholders + minority interest)/100 * (balance sheet total - advances
received)
Earnings per share = Profit belonging to parent company shareholders / Average
number of shares during the period, adjusted for share issues
Equity per share = Shareholders' equity held by parent company shareholders /
Number of shares at end of period, adjusted for share issues
Gearing, % = (Interest-bearing debt - cash in hand and at bank) /
(Shareholders' equity held by parent company shareholders + minority interest)
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