2012-02-16 07:00:00 CET
2012-02-16 07:03:59 CET
REGULATED INFORMATION
Elektrobit Oyj - Financial Statement Release
EB, ELEKTROBIT CORPORATION, FINANCIAL STATEMENT BULLETIN 2011
STOCK EXCHANGE RELEASE
Free for publication on February 16, 2012, at 8.00 a.m. (CET+1)
EB, ELEKTROBIT CORPORATION, FINANCIAL STATEMENT BULLETIN 2011
NET SALES IN 2011 WAS AT THE SAME LEVEL AS IN 2010 AND OPERATING RESULT IMPROVED
CLEARLY, BEING HOWEVER NEGATIVE. DURING THE FOURTH QUARTER NET SALES GREW FROM
PREVIOUS YEAR AND OPERATING RESULT WAS CLEARLY POSITIVE.
SUMMARY 4Q 2011
* Net sales of the period grew to EUR 49.0 million (EUR 41.8 million,
4Q 2010), representing an increase of 17.2 % year-on-year. Net sales of
Automotive Business Segment grew to EUR 28.0 million (EUR 23.1 million,
4Q 2010), representing a 21.7 % growth year-on-year. The Wireless Business
Segment's net sales grew by 13.1 %, to EUR 21.0 million (EUR 18.6 million,
4Q 2010).
* Operating profit was EUR 3.5 million (EUR -7.7 million, including non-
recurring costs of EUR 4.5 million, 4Q 2010). Operating profit of the
Automotive Business Segment was EUR 2.1 million (EUR 1.1 million, 4Q 2010).
The Wireless Business Segment's operating profit was EUR 1.4 million (EUR
-8.8 million, including non-recurring costs of EUR 4.0 million, 4Q 2010).
* EBITDA was EUR 5.3 million (EUR -5.6 million, 4Q 2010).
* Cash flow from operating activities was EUR 7.1 million (EUR -4.9 million,
4Q 2010). Net cash flow was EUR 2.7 million (EUR -9.3 million, 4Q 2010).
* Earnings per share were EUR -0.02 (EUR -0.04, 4Q 2010).
SUMMARY OF THE YEAR 2011
* Net sales of the period amounted to EUR 162.2 million and was at the same
level as in previous year (EUR 161.8 million, in 2010). Net sales of the
Automotive Business Segment grew to EUR 98.3 million (EUR 80.1 million, in
2010), representing a 22.7 % growth year-on-year. The Wireless Business
Segment's net sales fell by 21.1 % to EUR 63.9 million (EUR 81.0 million, in
2010).
* Operating loss was EUR -4.0 million (EUR -17.3 million, including non-
recurring costs and impairments of EUR 12.7 million, in 2010). Operating
profit of Automotive Business Segment was EUR 0.8 million (EUR 1.9 million,
in 2010) and the operating loss of Wireless Business Segment was EUR -4.7
million (EUR -19.3 million, including non-recurring costs and impairments of
EUR 12.3 million, in 2010).
* Earlier on October 19, 2010, EB's customer TerreStar Networks Inc. filed for
voluntary petition for reorganization, and its parent company TerreStar
Corporation filed for voluntary petition for reorganization on February
16, 2011. Under the review period there were no changes in valuation in EB's
receivables from these companies.
* EBITDA was EUR 4.7 million (EUR -8.8 million, in 2010). Automotive Business
Segment's EBITDA was EUR 6.0 million and Wireless Business Segment's EBITDA
was EUR -1.6 million.
* Cash flow from operating activities was EUR 5.3 million (EUR 1.5 million, in
2010). The net cash flow was EUR -10.6 million (EUR -38.5 million, in 2010,
including the distribution of EUR 25.9 million from the share premium fund).
* Cash and other liquid assets totaled EUR 10.0 million (EUR 20.5 million, in
2010).
* Equity ratio remained strong at 62.8% (62.4%, in 2010).
* Earnings per share were EUR -0.04 (EUR -0.12, in 2010).
* The Board of Directors proposes to General Meeting that no dividend shall be
distributed.
EB'S CEO JUKKA HARJU:"During the fourth quarter EB's business developed well. Operating profit was
clearly positive and net sales grew by 17.2 per cent compared to the
corresponding period in the previous year. Net sales of both Business Segments
grew and operating result was clearly positive. The turning to growth and the
operating profit of Wireless Business Segment in the fourth quarter were
important results from the actions executed during the year to strengthen the
sales and improve the cost structure.
During the whole year 2011 EB's net sales was at the same level as in the
previous year, Automotive Business Segment growing and Wireless Business Segment
decreasing. Carmakers increased their investments in software development for
new car models and the demand for EB's software products and services continued
to grow. In Wireless Business Segment EB succeeded to grow its business
especially in the defence and mobile infrastructure markets and thus replace the
strongly reduced net sales of satellite terminal business at the end of 2011.
Also the net sales of radio channel emulators grew from the previous year.
The objective for 2011 was positive operating result and profitability
development. Profitability improved significantly from the previous year and the
operating result from the fourth quarter was good. However the operating result
of the whole financial year remained negative due to the weaker than expected
operating result from the previous quarters.
EB continued efforts to collect its receivables from TerreStar Networks Inc. and
its parent company TerreStar Corporation Inc. in their reorganization process in
the United States. During 2011 there were no changes in valuation of EB's
receivables from these companies. In 2012 EB will continue the efforts to
collect our receivables.
Improving the profitability is our most important goal in 2012. The outlook for
growth of net sales in both Business Segments is good and this together with the
improved cost structure of Wireless Business Segment gives a good possibility
for positive development of the business in 2012."
OUTLOOK FOR 2012
The demand for EB's products and services is estimated to develop positively
during 2012 in both Automotive and Wireless Business Segments. Carmakers
continue to invest in software for new car models and the market for automotive
software products and services is estimated to continue growing. In Wireless
Business Segment the demand growth will be driven by especially the increasing
use of the LTE technology that increases the performance of mobile networks and
the authorities' needs for new communication solutions that use commercial
technologies of smart phones and mobile networks.
EB expects for the year 2012 that net sales and operating result will grow
clearly from the previous year (net sales of EUR 162.2 million, and operating
loss of EUR -4.0 million in 2011). For the first half of 2012 EB expects that
the net sales will grow clearly (EUR 76.1 million in 1H 2011) and operating
result will be positive (EUR -4.4 million in 1H 2011). The operating result of
the first quarter of 2012 is expected to remain below the level of the operating
result of the fourth quarter 2011 (EUR 3.5 million in 4Q 2011).
Despite of the uncertainty regarding world economy development, EB believes that
the visibility has slightly improved through the somewhat improved visibility in
demand and improved cost structure in Wireless Business Segment, as well as
through the grown business volume in the mobile infrastructure and authorities
markets. Hence it is possible to give an estimate of the probable business
development for a slightly longer time period than before. Therefore, in
addition to earlier half-year outlook, in future, EB also estimates the probable
development during the whole financial period.
The profit outlook for the year 2012 is based on the assumption that there will
be no further bookings of impairments of EB's accounts receivable from TerreStar
Networks Inc. and TerreStar Corporation. It is possible that, based on later
information related to reorganizations of TerreStar Networks and TerreStar
Corporation, this view may need to be reconsidered. Due to the uncertainties
related to the outcome of reorganization processes of TerreStar Networks and
TerreStar Corporation, the credit risk may still grow during 2012. More
specific market outlook is presented under the "Business Segments' development
during October-December 2011 and market outlook" section, and uncertainties
regarding reorganization of TerreStar Networks and TerreStar Corporation, the
amount of the receivables and collecting the receivables as well as other
uncertainties regarding the outlook under "Risks and Uncertainties" section.
Information on TerreStar Networks' and TerreStar Corporation's reorganizations
are presented in the October 20 and 25, November 20 and December 30, 2010,
February 17, 2011, and November 18, 2011 stock exchange releases as well as in
EB's interim reports and financial statement at www.elektrobit.com.
INVITATION TO A PRESS CONFERENCE
EB will hold a press conference on the Financial Statement 2011 for media,
analysts and institutional investors in Finland, Oulu, Tutkijantie 8, meeting
room 1 on Thursday, February 16, 2012, at 11.00 am. (CET+1). The conference will
also be held as a conference call and the presentation will be shown
simultaneously in the Internet through WebEx. The conference will be held in
English. For more information on joining the conference please go to
www.elektrobit.com/investors.
EB, Elektrobit Corporation
EB creates advanced technology and turns it into enriching end-user experiences.
EB is specialized in demanding embedded software and hardware solutions for
wireless and automotive industries. The net sales for the year 2011 totaled MEUR
162.2. Elektrobit Corporation is listed on NASDAQ OMX
Helsinki.www.elektrobit.com
EB, ELEKTROBIT CORPORATION, FINANCIAL STATEMENT BULLETIN 2011
FINANCIAL PERFORMANCE DURING JANUARY-DECEMBER 2011
(Corresponding figures are for January-December 2010 unless otherwise indicated)
EB's net sales during January-December 2011 increased by 0.3 per cent to EUR
162.2 million (EUR 161.8 million). Operating loss was EUR -4.0 million (EUR
-17.3 million, including non-recurring costs and impairments of EUR 12.7
million).
Net sales of the Automotive Business Segment grew strongly in January-December
2011 to EUR 98.3 million (EUR 80.1 million), representing 22.7% growth year-on-
year. The operating profit was EUR 0.8 million (EUR 1.9 million). During the
first and fourth quarter the operating result of the Automotive Business Segment
developed as planned, but was lower than expected during the second and third
quarters due to the higher than estimated project costs.
The Wireless Business Segment's net sales in January-December 2011 fell by
21.1% year-on-year to EUR 63.9 million (EUR 81.0 million). The significant
decrease in net sales was mainly due to the remarkable decline in the volume of
the satellite terminal business.
The operating loss of the Wireless Business Segment was EUR -4.7 million,
including EUR 0.9 million costs related to collecting the receivables from
TerreStar (EUR -19.3 million, including non-recurring costs and impairments of
EUR 12.7 million). The operating loss in the reporting period mainly resulted
from the first quarter of 2011, as the order book development in the new
satellite communication solution business, to replace the discontinued satellite
terminal business for TerreStar at the end of 2010, was slower than expected. In
addition, the operating result was affected by the increased competition in the
area of smart phone related R&D services. During the third quarter the operating
result weakened due to the seasonality of EB's business and delays in the
customer projects. Increased net sales and cost saving actions in 2011
contributed significantly to Wireless Business Segments good operating result in
the last quarter of 2011.
The total R&D investments during the reporting period grew to EUR 24.0 million
(EUR 21.6 million), representing 14.8 % of the net sales (13.3 %). EUR 6.6
million of R&D investments were capitalized (EUR 5.6 million). The amount of
capitalized R&D investments at the end of the fiscal year was EUR 11.5 million.
A Significant part of these capitalizations is related to customer agreements of
Automotive Business Segment, where future license fees are expected to
accumulate based on the actual car delivery volumes.
+----------------------------------------------------------+---------+---------+
|CONSOLIDATED INCOME STATEMENT (MEUR) |1-12 2011|1-12 2010|
+----------------------------------------------------------+---------+---------+
| |12 months|12 months|
+----------------------------------------------------------+---------+---------+
|NET SALES | 162.2| 161.8|
+----------------------------------------------------------+---------+---------+
|OPERATING PROFIT (LOSS) | -4.0| -17.3|
+----------------------------------------------------------+---------+---------+
|Financial income and expenses | -0.4| -1.3|
+----------------------------------------------------------+---------+---------+
|RESULT BEFORE TAX | -4.5| -18.6|
+----------------------------------------------------------+---------+---------+
|RESULT FOR THE PERIOD FROM CONTINUING OPERATIONS | -5.1| -15.7|
+----------------------------------------------------------+---------+---------+
|TOTAL COMPREHENSIVE INCOME FOR THE PERIOD | -5.2| -14.9|
+----------------------------------------------------------+---------+---------+
| | | |
+----------------------------------------------------------+---------+---------+
|Result for the period attributable to: | | |
+----------------------------------------------------------+---------+---------+
| Equity holders of the parent | -5.3| -16.1|
+----------------------------------------------------------+---------+---------+
| Non-controlling interests | 0.2| 0.5|
+----------------------------------------------------------+---------+---------+
|Total comprehensive income for the period attributable to:| | |
+----------------------------------------------------------+---------+---------+
| Equity holder of the parent | -5.5| -15.4|
+----------------------------------------------------------+---------+---------+
| Non-controlling interests | 0.2| 0.5|
+----------------------------------------------------------+---------+---------+
| | | |
+----------------------------------------------------------+---------+---------+
|Earnings per share from continuing operations, EUR | -0.04| -0.12|
+----------------------------------------------------------+---------+---------+
- Cash flow from operating activities was EUR 5.3 million (EUR 1.5 million).
- Equity ratio was 62.8% (62.4%).
- Net gearing was -1.4% (-10.3%).
QUARTERLY FIGURES
The distribution of the Group's overall net sales and profit, MEUR:
+--------------------------------------------------+-----+-----+-----+----+----+
| |4Q 11|3Q 11|2Q 11|1Q11|4Q10|
+--------------------------------------------------+-----+-----+-----+----+----+
|Net sales | 49.0| 37.0| 39.7|36.5|41.8|
+--------------------------------------------------+-----+-----+-----+----+----+
|Operating profit (loss) | 3.5| -3.1| -0.5|-3.9|-7.7|
+--------------------------------------------------+-----+-----+-----+----+----+
|Operating profit (loss) without non-recurring | 3.5| -3.1| -0.5|-3.9|-3.2|
|costs | | | | | |
+--------------------------------------------------+-----+-----+-----+----+----+
|Result before taxes | 3.8| -3.1| -0.8|-4.3|-8.0|
+--------------------------------------------------+-----+-----+-----+----+----+
|Result for the period | 3.2| -3.1| -0.8|-4.3|-5.4|
+--------------------------------------------------+-----+-----+-----+----+----+
Non-recurring items are exceptional gains and costs that are not related to
normal business operations and occur only seldom. These items include capital
gains or losses, significant changes in asset values such as write-downs or
reversals of write-downs, significant restructuring costs, or other items that
the management considers to be non-recurring. When evaluating a non-recurring
item, the euro translation value of the item is considered, and in case of a
change in an asset value, it is measured against the total value of the asset.
The distribution of net sales by Business Segments, MEUR:
+-----------------+-----+-----+-----+----+----+
| |4Q 11|3Q 11|2Q 11|1Q11|4Q10|
+-----------------+-----+-----+-----+----+----+
|Automotive | 28.0| 23.9| 22.7|23.6|23.1|
+-----------------+-----+-----+-----+----+----+
|Wireless | 21.0| 13.0| 17.1|12.7|18.6|
+-----------------+-----+-----+-----+----+----+
|Corporation total| 49.0| 37.0| 39.7|36.5|41.8|
+-----------------+-----+-----+-----+----+----+
The distribution of net sales by market areas, MEUR and %:
+--------+-----+-----+-----+-----+-----+
| |4Q 11|3Q 11|2Q 11| 1Q11| 4Q10|
+--------+-----+-----+-----+-----+-----+
|Asia | 5.5| 3.3| 4.0| 2.7| 4.4|
| |11.2%| 8.8%|10.2%| 7.4%|10.6%|
+--------+-----+-----+-----+-----+-----+
|Americas| 7.6| 4.9| 5.5| 5.1| 10.8|
| |15.5%|13.4%|14.0%|13.9%|25.8%|
+--------+-----+-----+-----+-----+-----+
|Europe | 36.0| 28.8| 30.1| 28.7| 26.6|
| |73.3%|77.8%|75.9%|78.7%|63.6%|
+--------+-----+-----+-----+-----+-----+
Net sales and operating profit development by Business Segments and other
businesses, MEUR:
+-------------------------------+-----+-----+-----+----+----+
| |4Q 11|3Q 11|2Q 11|1Q11|4Q10|
+-------------------------------+-----+-----+-----+----+----+
|Automotive | | | | | |
|Net sales to external customers| 28.0| 23.9| 22.7|23.6|23.1|
|Net sales to other segments | 0.0| 0.0| 0.0| 0.0| 0.0|
|Operating profit (loss) | 2.1| -1.4| -0.5| 0.6| 1.1|
+-------------------------------+-----+-----+-----+----+----+
|Wireless | | | | | |
|Net sales to external customers| 21.1| 12.9| 16.9|12.7|18.6|
|Net sales to other segments | 0.1| 0.1| 0.2| 0.0| 0.0|
|Operating profit (loss) | 1.4| -1.7| 0.1|-4.6|-8.8|
+-------------------------------+-----+-----+-----+----+----+
|Other businesses | | | | | |
|Net sales to external customers| 0.0| 0.2| 0.0| 0.1| 0.2|
|Operating profit (loss) | 0.0| -0.1| -0.1| 0.1| 0.1|
+-------------------------------+-----+-----+-----+----+----+
|Total | | | | | |
|Net sales | 49.0| 37.0| 39.7|36.5|41.8|
|Operating profit (loss) | 3.5| -3.1| -0.5|-3.9|-7.7|
+-------------------------------+-----+-----+-----+----+----+
BUSINESS SEGMENTS' DEVELOPMENT DURING OCTOBER-DECEMBER 2011 AND MARKET OUTLOOK
(Corresponding figures are for October-December 2010 unless otherwise indicated)
EB's reporting is based on two segments which are the Automotive and Wireless
Business Segments.
AUTOMOTIVE
In Automotive Business Segment EB offers software products and R&D services for
global carmakers, car electronics suppliers and other suppliers to the
automotive industry. The offering includes in-car infotainment solutions, such
as navigation and human machine interfaces (HMI), as well as software for
electronic control units (ECU) and driver assistance. By combining its software
products and R&D services, EB is creating unique, customized solutions for the
automotive industry
During the fourth quarter of 2011 the net sales of the Automotive Business
Segment amounted to EUR 28.0 million (EUR 23.1 million), representing a strong
21.7% growth year-on-year. The operating profit was EUR 2.1 million (EUR 1.1
million).
Solid overall market demand continued for EB's services and for own automotive
grade software products and solutions adapted and integrated to the customer
specific requirements. EB continued to grow during the fourth quarter in the
infotainment, driver assistance and ECU (Electronic Control Unit) software
markets. EB continued its R&D investments in the automotive software products
and tools.
Mr. Alexander Kocher (M.Sc., Electrical Engineering) started as the President of
the Automotive Business Segment and Managing Director of Elektrobit Automotive
GmbH, as of November 1, 2011.
Automotive Market Outlook
The demand for EB's products and services is estimated to develop positively
during 2012 in Automotive Business Segment. Carmakers continue to invest in
automotive software for new car models, and the market for automotive software
products and services is estimated to continue growing.
The move to greater electronic content in cars has been underway for several
years and has been responsible for such major innovations as security systems,
anti-lock brakes, engine control units, driver assistance, and infotainment.
These features have become so enormously popular that they are now widely
available in both low-end and high-end vehicles, demonstrating that consumers
are willing to pay for technology that enhances their driving experience. As a
result from this and the reduced costs as production volumes ramp up, carmakers
have been steadily integrating more electronic components into vehicles. A
Roland Berger study estimates the share of electronics in cars will grow from
23 percent in 2010 to 33 percent until 2020.
The increasingly sophisticated and networked features and growing performance
foster the complexity of automotive electronics. At the same time consumers
expect the same richness of features and user experience they know from the
internet and mobile devices also within the car. These development trends are
driving the industry towards gradual separation of software and hardware in
electronics solutions. Hence it is necessary to manage the architectural
software layer appropriately and to aim for efficiency in innovation and
implementation. The use of standard software solutions is expected to increase
in the automotive industry. This enables faster innovation, improves quality and
development efficiency and reduces complexity related to deployment of software.
The fundamental industry migration and consequent growth of the automotive
software market will continue. Cost pressures of the automotive industry are
expected to accelerate the need of productized and efficient software solutions
EB is offering. The estimated annual automotive software market growth rate
until 2018 is expected to exceed the growth rate of passenger car production
volume that is estimated to be 5.6% CAGR (LMC Automotive's Q4 2011 Forecast).
EB's net sales cumulating from the automotive industry is currently primarily
driven by the development of software and software platforms for new cars. Hence
the dependency of EB's net sales on car production volumes is currently limited;
however, the direct dependency on production volumes is expected to increase as
a result of the EB's transition towards software product business models over
the forthcoming years.
WIRELESS
The Wireless Business Segment offers development services and customized
solutions for wireless communications markets, radio channel emulator products
for industries and authorities utilizing wireless technologies, and products for
the authority markets.
Net sales of the Wireless Business Segment during the fourth quarter of 2011 was
EUR 21.0 million (EUR 18.6 million), representing an increase of 13.1 % year-on-
year. Operating profit was EUR 1.4 million (EUR -8.8 million, including non-
recurring costs and impairments of EUR 4.0 million). Net sales grew especially
in the radio channel emulator business and mobile infrastructure R&D services
due to the strong demand related to LTE (Long Term Evolution) technology. The
demand grew also in the defence and authority markets. The increased net sales
and the cost saving actions done in 2011 made a significant impact on the good
operating result of the Wireless Business Segment in the last quarter of 2011.
EB continued its investments in radio channel emulation products and next
generation special terminals product platforms. In December, the EB-designed
Special Terminal Platform won the "Technology of the Year" Award by Wireless
Innovation Forum.
Wireless Market Outlook
The demand for EB's products and services is estimated to develop positively
during 2012 in Wireless Business Segment.
In the mobile infrastructure market the use of LTE standard, which improves the
performance of radio channel and mobile networks, is expected to continue to
gain strength. EB's business driven by LTE is expected to increase. Mastering of
multi-radio technologies and end-to-end system architectures covering both
terminals and networks has gained importance in the complex wireless technology
industry. Fast implementation of LTE technology and wide radio spectrum
bandwidth needed are creating opportunities for EB.
The market for communications, interference and intelligence solutions targeted
for defence and public authorities is estimated to remain stable. EB's
competence and long experience in software radio based solutions is expected to
bring new business opportunities. The trend of adopting new commercial
technologies, such as LTE and smart phone related software applications, is
expected to continue on special verticals such as public safety. The networks
used by public authorities often utilize dedicated spectrum blocks outside the
commercial frequency bands, which generates the need for special user terminal
variants for these networks.
The smart phone related R&D services market for device manufacturers decreased
strongly during 2011 due to the strategy change of Nokia, and the demand is not
expected to grow during 2012. In the mobile satellite communication industry the
demand for terminals for new data and mobile communications services is expected
to slowly increase during the next few years.
The performance of radio channel is going to increase quickly when introducing
new LTE technologies. This will create demand for advanced test tools during the
next few years. The test tool market is expanding from the performance testing
of LTE base stations to LTE terminals, where the over-the-air (OTA) technology
will be widely used. EB provides world leading channel emulation tools for the
development of MIMO based LTE, LTE-Advanced and other advanced radio
technologies.
RESEARCH AND DEVELOPMENT
EB continued its investments in R&D in the automotive software products and
tools, in radio channel emulation products and in next generation special
terminals product platforms.
The total R&D investments during the fourth quarter of 2011 were EUR 6.0 million
(EUR 6.1 million, 4Q 2010), equaling 12.2% of the net sales (14.6%, 4Q 2010).
EUR 1.7 million of R&D investments were capitalized (EUR 2.3 million, 4Q 2010).
OUTLOOK FOR 2012The demand for EB's products and services is estimated to develop positively
during 2012 in both Automotive and Wireless Business Segments. Carmakers
continue to invest in software for new car models and the market for automotive
software products and services is estimated to continue growing. In Wireless
Business Segment the demand growth will be driven by especially the increasing
use of the LTE technology that increases the performance of mobile networks and
the authorities' needs for new communication solutions that use commercial
technologies of smart phones and mobile networks.
EB expects for the year 2012 that net sales and operating result will grow
clearly from the previous year (net sales of EUR 162.2 million, and operating
loss of EUR -4.0 million in 2011). For the first half of 2012 EB expects that
the net sales will grow clearly (EUR 76.1 million in 1H 2011) and operating
result will be positive (EUR -4.4 million in 1H 2011). The operating result of
the first quarter of 2012 is expected to remain below the level of the operating
result of the fourth quarter 2011 (EUR 3.5 million in 4Q 2011).
Despite of the uncertainty regarding world economy development, EB believes that
the visibility has slightly improved through the somewhat improved visibility in
demand and improved cost structure in Wireless Business Segment, as well as
through the grown business volume in the mobile infrastructure and authorities
markets. Hence it is possible to give an estimate of the probable business
development for a slightly longer time period than before. Therefore, in
addition to earlier half-year outlook, in future, EB also estimates the probable
development during the whole financial period.
The profit outlook for the year 2012 is based on the assumption that there will
be no further bookings of impairments of EB's accounts receivable from TerreStar
Networks Inc. and TerreStar Corporation. It is possible that, based on later
information related to reorganizations of TerreStar Networks and TerreStar
Corporation, this view may need to be reconsidered. Due to the uncertainties
related to the outcome of reorganization processes of TerreStar Networks and
TerreStar Corporation, the credit risk may still grow during 2012. More
specific market outlook is presented under the "Business Segments' development
during October-December 2011 and market outlook" section, and uncertainties
regarding reorganization of TerreStar Networks and TerreStar Corporation, the
amount of the receivables and collecting the receivables as well as other
uncertainties regarding the outlook under "Risks and Uncertainties" section.
Information on TerreStar Networks' and TerreStar Corporation's reorganizations
are presented in the October 20 and 25, November 20 and December 30, 2010,
February 17, 2011, and November 18, 2011 stock exchange releases as well as in
EB's interim reports and financial statement at www.elektrobit.com.
RISKS AND UNCERTAINTIES
EB has identified a number of business, market and finance related risk factors
and uncertainties that can affect the level of sales and profits. Those of the
greatest significance on a short term are those affecting the utilization and
chargeability levels and average hourly prices of R&D services. On the ongoing
financial period the global economic uncertainty may affect the demand for EB's
services, solutions and products and provide pressure on e.g. pricing. It may
also increase the risk for credit losses and weaken the availability and terms
of financing.
On February 15, 2012, EB's receivables from TerreStar amounted to approximately
USD 25.8 million (EUR 19.6 million as per exchange rate of February 14, 2012),
which it has claimed in the Chapter 11 cases of both TerreStar Networks and
TerreStar Corporation. In addition to the booked receivables, EB has also
claimed additional costs in the amount of approximately USD 2.1 million (EUR
1.6 million as per exchange rate of February 14, 2012) and resulting mainly from
the ramp down of the business operations between the parties. Thus, EB has
asserted claims against each of the TerreStar entities in amounts totaling USD
27.9 million (EUR 21.2 million as per exchange rate of February 14, 2012). Due
to uncertainties related to the accounts receivable, EB booked an impairment of
the accounts receivable in the amount of EUR 8.3 million during the second half
of 2010.
On October 19, 2010, TerreStar Networks and certain other affiliates of
TerreStar Corporation and on February 16, 2011, the parent company TerreStar
Corporation filed voluntary petitions for reorganization under Chapter 11 of the
United States Bankruptcy Code to strengthen their financial position.
Generally in a Chapter 11 case, any distribution of cash or other assets by a
debtor to satisfy pre-bankruptcy claims of its creditors must be made under a
Chapter 11 plan of reorganization or liquidation. Such plans must be approved by
the United States Bankruptcy Court and (with limited exceptions) an affirmative
vote of all classes of creditors whose claims will not be paid fully and
immediately after the plan is approved by the court and becomes effective by its
terms. Recoveries by holders of claims against TerreStar Networks and TerreStar
Corporation are to be funded by separate pools or streams of assets.
Within the first four months of its Chapter 11 case, TerreStar Networks filed,
then withdrew, a proposed plan of reorganization. Subsequently, on July
7, 2011, the United States Bankruptcy Court approved the sale of substantially
all TerreStar Networks' assets to Gamma Acquisition L.L.C., an acquisition
subsidiary formed by Dish Network Corporation for about USD 1.375 billion. Based
upon filings made by TerreStar Networks with the Bankruptcy Court, USD 1.345
billion of the purchase price has been funded to date, with the remainder of the
purchase price payable at closing, and payments have been made to secured
creditors from the sale proceeds in the amount of about USD 1.128 billion.
However, the sale will not result in an immediate distribution to general
unsecured creditors. Any such distribution must be provided for under a Chapter
11 plan of liquidation that has been filed, voted on and submitted to the court
for approval. On December 6, 2011, TerreStar Networks again filed, and
thereafter amended, a Chapter 11 plan. The Bankruptcy Court has scheduled a
hearing for February 14, 2012 to consider this second amended plan, which
according to the debtors has received the approval of all creditor classes
entitled to vote on the plan. If approved by the court, TerreStar Networks'
second amended plan is to provide each holder of an unsecured claim (such as EB)
with a pro rata share of cash available for distribution. Based upon information
contained in the debtors' disclosure statement accompanying the plan, EB
estimates that its pro rata distribution may be in the range of 8-10% of the
face amount of its claim. However, this estimate is subject to various
assumptions, and therefore the amount and timing of EB's distribution cannot be
predicted with certainty at this time.
On July 22, 2011, TerreStar Corporation filed a plan of reorganization, which
was thereafter amended on December 27, 2011 and further amended on January
12, 2012. The second amended plan proposes that unsecured claims (such as
EB's), if allowed by the Bankruptcy Court, will be exchanged for new notes to be
issued by a reorganized TerreStar Corporation in the face amount of the claim.
The notes are to be issued as unsecured notes in a total aggregate principal
amount not to exceed $35 million, with a seven-year maturity, bearing interest
at the rate of 6% per annum. Payment of the note obligations is to be funded by
future revenues and profits of reorganized TerreStar Corporation. It is
premature to speculate regarding distributions to creditors under this plan
because the plan TerreStar Corporation filed may or may not obtain the necessary
approvals, and the terms of the plan may change through negotiation with
creditors. EB filed a preliminary objection to an earlier version of the plan,
asserting that it failed to satisfy applicable provisions of the Bankruptcy Code
and therefore could not be confirmed. EB intends to file a further objection to
the second amended plan of TerreStar Corporation, to vote against the proposed
plan, and to vigorously contest confirmation of the plan at a hearing to be held
by the Bankruptcy Court on March 7, 2012.
As part of the process of reconciling accounts in preparation for making
distributions under a plan, Chapter 11 debtors often challenge the amount or
validity of some creditor claims. On November 16, 2011, after EB filed its
preliminary objection to the proposed Chapter 11 plan of TerreStar Corporation,
two objections to EB's claim were filed, one by TerreStar Corporation and its
affiliated debtors (not including TerreStar Networks) and a joint objection by a
group of holders of TerreStar Corporation preferred stock that support the
proposed plan. The preferred stockholders alleged, among other things, that
EB's guaranty claim in the amount of approximately $24.8 million (at least)
should be disallowed pursuant to various legal theories. TerreStar Corporation
joined in the preferred stockholders' argument that TerreStar Corporation has no
liability to EB under its guaranty. On December 12, 2011, EB filed a sworn
opposition to both objections, stating that the objections are flawed as a
matter of law and wholly without evidentiary support, and maintaining its right
to payment in the full amount claimed. The Bankruptcy Court has scheduled a
trial on the merits of EB's claim and the objections for May 10, 2012. EB
intends to vigorously defend such objections to its claims, but speculation
regarding the likely outcome of these contested matters is premature at this
time. To date TerreStar Networks has asserted no objection to the amount or
validity of EB's claims in its bankruptcy proceeding, and EB is not aware that
any such objection is contemplated.
Further, as part of the Chapter 11 process, debtors often seek to recover
payments previously made to creditors pursuant to various provisions of the
Bankruptcy Code. The risk that the TerreStar debtors may attempt to recover
payments from EB, or that such recovery actions, if attempted, may be
successful, likewise cannot be ruled out at this time.
Based on EB's current understanding, there is no reason to believe that there
would be further impairment losses on EB's account receivable from TerreStar
Networks and TerreStar Corporation. EB aims to collect the amounts owed to it in
full through the Chapter 11 cases of TerreStar Networks and TerreStar
Corporation, and/or for example through selling of the earlier mentioned
accounts receivable. It is possible that based on later information related to
the TerreStar Networks' and TerreStar Corporation's Chapter 11 cases, the above
views may need to be reconsidered. Despite the TerreStar companies' efforts to
reorganize, it is possible that the credit risk may still grow during 2012.
Should the accounts receivable not be collected at all, either from TerreStar
Networks or TerreStar Corporation, an impairment loss and costs related to the
collection process would additionally lower EB's operating result on a non-
recurring basis by approximately EUR 10 million, at maximum (USD-nominated items
as per exchange rate of February 14, 20121). However, this would not have any
significant negative effect on the EB's cash flow.
As EB's customer base consists mainly of companies operating in the fields of
automotive and telecommunications and defense and security authorities, the
company is exposed to market changes in these industries. EB believes that
expanding the customer base will reduce dependence on individual companies and
that the company will thereby be mainly affected by the general business climate
in automotive and telecommunication industries. However, some parts of EB's
business are more sensitive to customer dependency than others. Respectively,
this may translate as accumulation of risk with respect to outstanding
receivables and ultimately with respect to credit losses. The more specific
market outlook is presented under the "Business Segments' development during the
fourth quarter 2011 and market outlook" section.
EB's operative business risks are mainly related to following items:
uncertainties and short visibility on customers' product program decisions,
their make or buy decisions and on the other hand, their decisions to continue,
downsize or terminate current product programs, execution and management of
large customer projects, ramping up and down project resources, availability of
personnel in labour markets (in particular in Germany and Finland), timing and
on the other hand successful utilization of the most important technologies and
components, competitive situation and potential delays in the markets, timely
closing of customer and supplier contracts with reasonable commercial terms,
delays in R&D projects, realization of expected return on capitalized R&D
investments, obsolescence of inventories and technology risks in product
development causing higher than planned R&D costs. Revenues expected to come
from either existing or new products and customers include normal timing risks.
EB has certain significant customer projects and deviation in their expected
continuation could result also significant deviations in the Company's outlook.
In addition there are typical industry warranty and liability risks involved in
selling EB's services, solutions and products.
Some of EB's businesses operate in the industries that are heavily patented and
therefore include risks related to management of intellectual property rights,
on the one hand related to accessibility on commercially acceptable terms of
certain technologies in the EB's products and services, and on the other hand
related to an ability to protect technologies, which EB develops or licenses
from others, from claims that third parties' intellectual property rights are
infringed. Also parties outside of the industries operate actively in order to
protect and commercialize their patents and therefore in their part increase the
risks related to the management of intellectual property rights. At worst,
claims that third parties' intellectual property rights are infringed, could
lead to substantial liabilities for damages. Also EB has been formally requested
by one of its customer for indemnification that is unspecified both in terms of
the grounds and the amount. While the analysis of the situation is pending,
based on preliminary information available it does not seem likely that the
claim would result to a significant liability on a short term. It is possible
that based on later information, the above views may need to be reconsidered.
Product delivery business model includes such risks as high dependency on actual
product volumes and development of the cost of materials. The above-mentioned
risks may manifest themselves as lower amounts product delivery or higher cost
of production, and ultimately, as lower profit.
More information on the risks and uncertainties affecting EB can be found on the
Company's website at www.elektrobit.com.
STATEMENT OF FINANCIAL POSITION AND FINANCING
The figures presented in the statement of financial position of December
31, 2011, are compared with the statement of the financial position of December
31, 2010 (MEUR). The figures for the period under review contain provision of
EUR 1.5 million.
12/2011 12/2010
Non-current assets 44.1 41.2
Current assets 71.0 83.0
Total assets 115.1 124.2
Share capital 12.9 12.9
Other equity 52.6 57.6
Non-controlling interests 1.5 1.3
Total shareholders' equity 67.0 71.8
Non-current liabilities 6.9 11.6
Current liabilities 41.3 40.7
Total shareholders' equity and liabilities 115.1 124.2
Net cash flow from operations during the period under review:
+ net profit +/- adjustment of accrual basis items EUR +2.1 million
+ decrease in net working capital EUR +0.6 million
- interest, taxes and dividends EUR +2.6 million
= cash generated from operations EUR +5.3 million
- net cash used in investment activities EUR -11.1 million
- net cash used in financing EUR -4.7 million
= net change in cash and cash equivalents EUR -10.6 million
Operating cash flow includes tax refunds of EUR 3.8 million in US subsidiary.
The amount of accounts and other receivables, booked in current receivables, was
EUR 59.3 million (EUR 60.6 million on December 31. 2010). Accounts and other
payables, booked in interest-free current liabilities, were EUR 36.3 million
(EUR 35.6 million on December 31. 2010). The amount of non-depreciated
consolidation goodwill at the end of the period under review was EUR 19.3
million (EUR 18.5 million on December 31. 2010).
The amount of gross investments in the period under review was EUR 12.4 million
including R&D capitalizations of EUR 6.6 million. Net investments for the
reporting period totaled EUR 11.9 million. The total amount of depreciation
during the period under review was EUR 8.7 million, including EUR 1.6 million of
depreciation owing to business acquisitions.
The amount of interest-bearing debt at the end of the reporting period was EUR
9.0 million. The distribution of net financing expenses on the income statement
was as follows:
interest dividend and other financial income EUR 0.3 million
interest expenses and other financial expenses EUR -0.6 million
foreign exchange gains and losses EUR -0.1 million
EB's equity ratio at the end of the period was 62.8% (62.4% at the end of 2010).
Cash and other liquid assets at the end of the reporting period were EUR 10.0
million. EB has a binding overdraft credit facility agreement of EUR 10 million,
valid until mid 2012. At the end of the reporting period, this facility was not
used.
EB follows a hedging strategy, the objective of which is to ensure the margins
of business operations in changing market circumstances by minimizing the
influence of exchange rates. In accordance with the hedging strategy, the agreed
customer commitments net cash flow of the currency in question is hedged. The
net cash flow is determined on the basis of sales receivables, payables, the
order book and the budgeted net currency cash flow. The hedged foreign currency
exposure at the end of the review period was equivalent to EUR 9.8 million.
PERSONNEL
EB employed an average of 1553 people between January and December 2011. At the
end of December, EB had 1607 employees (1539 at the end of 2010). A significant
part of EB's personnel are product development engineers.
CHANGE IN COMPANY'S MANAGEMENT
On November 1, 2011 Mr. Alexander Kocher (M. Sc., Electrical Engineering)
started as President of the Automotive Business Segment and Managing Director of
Elektrobit Automotive GmbH. Mr. Kocher transferred to EB from Wind River GmbH,
where he worked as Vice President and General Manager of Automotive Business
Unit.
FLAGGING NOTIFICATIONS
There were no changes in ownership during the period under review that would
have caused flagging notifications which are obligations for disclosure in
accordance with Chapter 2, section 9 of the Securities Market Act.
EVENTS AFTER THE REVIEW PERIOD
The company has no significant events subsequent to the reporting period.
PROPOSAL BY THE BOARD OF DIRECTORS ON THE USE OF THE PROFIT SHOWN ON THE BALANCE
SHEET DAND THE PAYMENT OF DIVIDEND
According to the parent company's balance sheet at December 31, 2011, the
distributable assets of the parent company are EUR 104,481,807.25 of which the
loss of the financial year is EUR 812,533.81.
The Board of Directors proposes to the General Meeting to be held on March
26, 2012, that no dividend shall be paid.
ANNUAL GENERAL MEETING AND ANNUAL REPORT
Elektrobit Corporation's Annual General Meeting will be held on Monday, March
26, 2012, at 1 pm at the University of Oulu, Saalastinsali, Pentti Kaiteran katu
1, 90570 Oulu, Finland. Elektrobit Corporation's Annual Report, including the
Annual Accounts, the report by the Board of Directors and the Auditor's report
as well as Corporate Governance Statement, is available on the company's website
no later than March 5, 2012.
Oulu, February 16, 2012
EB, Elektrobit Corporation
The Board of Directors
Further Information:
Jukka Harju
CEO
Tel. +358 40 344 5466
Distribution:
NASDAQ OMX Helsinki
Major media
EB, ELEKTROBIT CORPORATION, FINANCIAL STATEMENT BULLETIN 2011
The consolidated financial statement has been prepared in accordance with
International Financial reporting Standards (IFRS). The Financial Statement of
2010 has been audited and the auditing report has been dated on February
15, 2012.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (MEUR) 1-12/2011 1-12/2010
12 months 12 months
NET SALES 162.2 161.8
Other operating income 2.8 2.4
Change in work in progress and finished goods 0.0 -0.2
Work performed by the undertaking for its own purpose
and capitalized 0.4 0.2
Raw materials -11.7 -15.4
Personnel expenses -95.2 -97.7
Depreciation -8.7 -8.5
Other operating expenses -53.8 -59.8
OPERATING PROFIT (LOSS) -4.0 -17.3
Financial income and expenses -0.4 -1.3
RESULT BEFORE TAXES -4.5 -18.6
Income taxes -0.6 2.9
RESULT FOR THE PERIOD FROM CONTINUING
OPERATIONS -5.1 -15.7
Other comprehensive income:
Exchange differences on translating foreign operations -0.2 0.8
Other comprehensive income for the period total -0.2 0.8
TOTAL COMPREHENSIVE INCOME FOR THE PERIOD -5.2 -14.9
Result for the period attributable to
Equity holders of the parent -5.3 -16.1
Non-controlling interests 0.2 0.5
Total comprehensive income attributable to
Equity holders of the parent -5.5 -15.4
Non-controlling interests 0.2 0.5
Earnings per share EUR continuing operations
Basic earnings per share -0.04 -0.12
Diluted earnings per share -0.04 -0.12
Average number of shares, 1000 pcs 129 413 129 413
Average number of shares, diluted, 1000 pcs 130 051 130 277
Dec. 31, Dec. 31,
CONSOLIDATED STATEMENT OF FINANCIAL POSITION (MEUR) 2011 2010
ASSETS
Non-current assets
Property, plant and equipment 9.0 10.5
Goodwill 19.3 18.5
Intangible assets 15.7 11.6
Other financial assets 0.1 0.2
Receivables 0.3
Deferred tax assets 0.1 0.1
Non-current assets total 44.1 41.2
Current assets
Inventories 1.8 1.9
Trade and other receivables 59.3 60.6
Financial assets at fair value through profit or loss 7.7
Cash and short term deposits 10.0 12.9
Current assets total 71.0 83.0
TOTAL ASSETS 115.1 124.2
EQUITY AND LIABILITIES
Equity attributable to equity holders of the parent
Share capital 12.9 12.9
Invested non-restricted equity fund 38.7 38.7
Translation difference 0.4 0.6
Retained earnings 13.4 18.3
Non-controlling interests 1.5 1.3
Total equity 67.0 71.8
Non-current liabilities
Deferred tax liabilities 1.0 1.4
Pension obligations 1.3 1.2
Provisions 0.5 1.0
Interest-bearing liabilities 4.0 8.0
Non-current liabilities total 6.9 11.6
Current liabilities
Trade and other payables 34.9 33.3
Financial liabilities at fair value through profit or
loss 0.3
Provisions 1.0 2.4
Interest-bearing loans and borrowings 5.0 5.1
Current liabilities total 41.3 40.7
Total liabilities 48.1 52.4
TOTAL EQUITY AND LIABILITIES 115.1 124.2
CONSOLIDATED STATEMENT OF CASH FLOWS (MEUR) 1-12/2011 1-12/2010
12 months 12 months
CASH FLOW FROM OPERATING ACTIVITIES
Result for the period -5.1 -15.7
Adjustment of accrual basis items 7.1 17.5
Change in net working capital 0.6 3.5
Interest paid on operating activities -0.4 -2.3
Interest received from operating activities 0.3 0.6
Other financial income and expenses, net received 0.0 0.0
Income taxes paid 2.6 -2.2
NET CASH FROM OPERATING ACTIVITIES 5.3 1.5
CASH FLOW FROM INVESTING ACTIVITIES
Acquisition of business unit, net of cash acquired -0.8 -0.3
Purchase of property, plant and equipment -1.9 -1.7
Purchase of intangible assets -8.5 -6.2
Purchase of other investments -0.0 -0.0
Sale of property, plant and equipment 0.1 0.1
Sale of intangible assets 0.1 0.0
Proceeds from sale of investments 0.0 0.1
NET CASH FROM INVESTING ACTIVITIES -11.1 -7.9
CASH FLOW FROM FINANCING ACTIVITIES
Proceeds from borrowing 0.2
Repayment of borrowing -2.2 -2.8
Payment of finance liabilities -2.8 -3.4
Distribution of funds from the share premium fund -25.9
NET CASH FROM FINANCING ACTIVITIES -4.7 -32.1
NET CHANGE IN CASH AND CASH EQUIVALENTS -10.6 -38.5
Cash and cash equivalents at beginning of period 20.5 59.1
Cash and cash equivalents at end of period 10.0 20.5
CONSOLIDATED STATEMENT OF
CHANGES IN EQUITY (MEUR)
A = Share capital
B = Share premium
C = Invested non-restricted equity fund
D = Retained earnings
E = Non-controlling interests
F = Total equity
A B C D E F
Equity on January 1, 2010 12.9 64.6 34.9 0.4 112.8
Distribution of funds from the share
premium fund -25.9 -25.9
Transfer from the share premium fund -38.7 38.7 0.0
Share-related compensation 0.6 0.6
Total comprehensive income for the period -15.4 0,5 -14.9
Other items -1.2 0.4 -0.8
Equity on December 31, 2010 12.9 0.0 38.7 18.9 1.3 71.8
Equity on January 1, 2011 12.9 38.7 18.9 1.3 71.8
Share-related compensation 0.4 0.4
Total comprehensive income for the period -5.5 0.2 -5.2
Other items 0.1 0.1
Equity on December 31, 2011 12.9 38.7 13.9 1.5 67.0
NOTES TO THE FINANCIAL STATEMENT BULLETIN
Accounting principles for the Financial Statement Bulletin:
The same accounting policies and methods of computation are followed in the
financial statement bulletin as compared with annual financial statements.
Explanatory comments about the seasonality or cyclicality of reporting period
operations:
The Company operates in business areas which are subject to seasonal
fluctuations.
Prior period error
The current receivables have been corrected retrospectively. The correction
applies to the tax asset of a foreign subsidiary. In the interim report, the
corrections have been made to the reporting periods 3Q 2010 - 2Q 2011. The
corrections decreases the current receivables by EUR 0.7 million and retaining
earnings by EUR 0.7 million. The correction has no relevant effect on the
exchange differences on translating foreign operations, net gearing, equity
ratio or equity per share.
Payment of dividend:
The General Meeting held on March 31, 2011 decided in accordance with the
proposal of the Board of Directors that no dividend shall be distributed.
SEGMENT INFORMATION (MEUR)
OPERATING SEGMENTS 1-12/2011 1-12/2010
12 months 12 months
Automotive
Net sales to external customers 98.3 80.1
Net sales to other segments 0.0 0.0
Net sales total 98.3 80.1
Operating profit (loss) 0.8 1.9
Wireless
Net sales to external customers 63.6 80.9
Net sales to other segments 0.4 0.0
Net sales total 63.9 81.0
Operating profit (loss) -4.7 -19.3
OTHER ITEMS
Other items
Net sales to external customers 0.4 0.8
Operating profit (loss) -0.1 0.1
Eliminations
Net sales to other segments -0.4 -0.0
Operating profit (loss) 0.0 0.0
Group total
Net sales to external customers 162.2 161.8
Operating profit (loss) -4.0 -17.3
Net sales of geographical areas (MEUR) 1-12/2011 1-12/2010
12 months 12 months
Net sales
Europe 123.5 96.8
Americas 23.2 53.4
Asia 15.5 11.6
Net sales total 162.2 161.8
Material events subsequent to the end of the interim period not reflected in the
financial statements for the interim period:
There are no such material events subsequent to the end of the interim report
period that have not been reflected in this report.
Related party transactions: 1-12/2011 1-12/2010
12 months 12 months
Employee benefits for key management and stock
option expenses total 1.6 2.1
CONSOLIDATED STATEMENT OF 10-12/ 7-9/ 4-6/ 1-3/ 10-12/
COMPREHENSIVE INCOME 2011 2011 2011 2011 2010
BY QUARTER (MEUR) 3 months 3 months 3 months 3 months 3 months
NET SALES 49.0 37.0 39.7 36.5 41.8
Other operating income 0.8 0.5 0.9 0.7 0.6
Change in work in progress and
finished goods -0.3 0.1 0.1 0.2 -0.5
Work performed by the undertaking
for its own purpose and
capitalized 0.4 0.0 0.0 0.1 0.0
Raw materials -3.1 -2.9 -3.0 -2.8 -6.1
Personnel expenses -25.2 -22.5 -23.3 -24.3 -26.1
Depreciation -1.8 -1.9 -2.7 -2.4 -2.1
Other operating expenses -16.3 -13.4 -12.2 -11.9 -15.3
OPERATING PROFIT (LOSS) 3.5 -3.1 -0.5 -3.9 -7.7
Financial income and expenses 0.3 0.0 -0.3 -0.4 -0.3
RESULT BEFORE TAXES 3.8 -3.1 -0.8 -4.3 -8.0
Income taxes -0.6 0.0 -0.0 0.0 2.6
RESULT FOR THE PERIOD FROM
CONTINUING OPERATIONS 3.2 -3.1 -0.8 -4.3 -5.4
Other comprehensive income
for the period total 0.0 -0.1 -0.0 -0.0 0.3
TOTAL COMPREHENSIVE
INCOME FOR THE PERIOD 3.2 -3.2 -0.9 -4.4 -5.1
Result for the period
attributable to:
Equity holders of the parent 3.1 -3.1 -0.8 -4.4 -5.5
Non-controlling interests 0.1 0.0 0.0 0.1 0.1
Total comprehensive income
for the period attributable to:
Equity holders of the parent 3.1 -3.2 -0.9 -4.5 -5.2
Non-controlling interests 0.1 0.0 0.0 0.1 0.1
CONSOLIDATED STATEMENT OF Dec. 31, Sept. 30, June 30, March 31, Dec. 31,
FINANCIAL POSITION (MEUR) 2011 2011 2011 2011 2010
ASSETS
Non-current assets
Property, plant and equipment 9.0 8.4 9.2 9.8 10.5
Goodwill 19.3 19.2 18.5 18.5 18.5
Intangible assets 15.7 14.3 13.4 12.2 11.6
Other financial assets 0.1 0.1 0.1 0.1 0.2
Receivables 0.3 0.3
Deferred tax assets 0.1 0.1 0.1 0.1 0.1
Non-current assets total 44.1 42.1 41.3 40.9 41.2
Current assets
Inventories 1.8 2.1 2.2 1.6 1.9
Trade and other receivables 59.3 54.7 47.0 52.2 60.6
Financial assets at fair value
through profit or loss 0.0 6.2 7.7
Cash and short term deposits 10.0 7.2 17.8 12.4 12.9
Current assets total 71.0 64.0 67.0 72.4 83.0
TOTAL ASSETS 115.1 106.1 108.3 113.4 124.2
EQUITY AND LIABILITIES
Equity attributable to equity
holders
of the parent
Share capital 12.9 12.9 12.9 12.9 12.9
Invested non-restricted equity
fund 38.7 38.7 38.7 38.7 38.7
Translation difference 0.4 0.4 0.5 0.6 0.6
Retained earnings 13.4 10.2 12.3 13.9 18.3
Non-controlling interests 1.5 1.4 1.4 1.3 1.3
Total equity 67.0 63.6 65.9 67.5 71.8
Non-current liabilities
Deferred tax liabilities 1.0 1.1 1.2 1.3 1.4
Pension obligations 1.3 1.3 1.2 1.2 1.2
Provisions 0.5 0.6 0.8 0.9 1.0
Interest-bearing liabilities 4.0 4.3 5.9 7.2 8.0
Non-current liabilities total 6.9 7.3 9.1 10.6 11.6
Current liabilities
Trade and other payables 34.9 29.1 27.6 29.0 33.3
Financial liabilities at fair
value
through profit or loss 0.3 0.5
Provisions 1.0 0.7 0.7 2.0 2.4
Interest-bearing loans and
borrowings (non-current) 5.0 4.9 5.0 4.3 5.1
Current liabilities total 41.3 35.2 33.3 35.3 40.7
Total liabilities 48.1 42.5 42.4 45.9 52.4
TOTAL EQUITY AND LIABILITIES 115.1 106.1 108.3 113.4 124.2
CONSOLIDATED STATEMENT 10-12/ 7-9/ 4-6/ 1-3/ 10-12/
OF CASH FLOWS BY QUARTER 2011 2011 2011 2011 2010
3 months 3 months 3 months 3 months 3 months
Net cash from operating
activities 7.1 -6.6 3.4 1.4 -4.9
Net cash from investing
activities -3.7 -2.3 -2.8 -2.3 -2.9
Net cash from financing
activities -0.6 -1.7 -0.8 -1.6 -1.5
Net change in cash and cash
equivalents 2.7 -10.6 -0.3 -2.4 -9.3
FINANCIAL PERFORMANCE RELATED RATIOS 1-12/2011 1-12/2010
12 months 12 months
STATEMENT OF COMPREHENSIVE INCOME (MEUR)
Net sales 162.2 161.8
Operating profit (loss) -4.0 -17.3
Operating profit (loss), % of net sales -2.5 -10.7
Result before taxes -4.5 -18.6
Result before taxes, % of net sales -2.8 -11.5
Result for the period -5.1 -15.7
PROFITABILITY AND OTHER KEY FIGURES
Interest-bearing net liabilities, (MEUR) -0.9 -7.4
Net gearing, -% -1.4 -10.3
Equity ratio, % 62.8 62.4
Gross investments, (MEUR) 12.4 10.7
Average personnel during the period 1553 1561
Personnel at the period end 1607 1539
AMOUNT OF SHARE ISSUE ADJUSTMENT Dec. 31, Dec. 31,
(1,000 pcs) 2011 2010
At the end of period 129 413 129 413
Average for the period 129 413 129 413
Average for the period diluted with stock options 130 051 130 277
STOCK-RELATED FINANCIAL RATIOS (EUR) 1-12/2011 1-12/2010
12 months 12 months
Basic earnings per share -0.04 -0.12
Diluted earnings per share -0.04 -0.12
Equity *) per share 0.51 0.54
*) Equity attributable to equity holders of the parent
MARKET VALUES OF SHARES (EUR) 1-12/2011 1-12/2010
12 months 12 months
Highest 0.76 1.25
Lowest 0.36 0.66
Average 0.55 0.92
At the end of period 0.38 0.67
Market value of the stock, (MEUR) 49.2 86.7
Trading value of shares, (MEUR) 5.0 16.8
Number of shares traded, (1,000 pcs) 9 169 18 190
Related to average number of shares % 7.1 14.1
SECURITIES AND CONTINGENT LIABILITIES Dec. 31, Dec. 31,
(MEUR) 2011 2010
AGAINST OWN LIABILITIES
Floating charges 11.4 3.1
Pledges 7.8 2.3
Guarantees 2.9 2.0
Other liabilities 12.0 10.1
Rental liabilities
Falling due in the next year 6.9 6.0
Falling due after one year 17.9 15.0
Other contractual liabilities
Falling due in the next year 2.5 3.9
Falling due after one year 2.1
Mortgages are pledged for liabilities totalled 4.3 6.3
NOMINAL VALUE OF CURRENCY DERIVATIVES Dec. 31, Dec. 31,
(MEUR) 2011 2010
Foreign exchange forward contracts
Market value -0.3 -0.0
Nominal value 5.5 11.0
Purchased currency options
Market value 0.1 0.1
Nominal value 4.3 5.0
Sold currency options
Market value -0.1 -0.1
Nominal value 8.6 10.0
[HUG#1586385]
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