2013-04-29 09:00:09 CEST
2013-04-29 09:00:49 CEST
REGULATED INFORMATION
Aspo - Interim report (Q1 and Q3)
Aspo Group Interim Report January 1 to March 31, 2013
ASPO Plc STOCK EXCHANGE RELEASE April 29, 2013, at 10:00
Operating profit improved and net sales increased
(comparative figures are for January-March 2012)
January-March 2013
- Aspo Group's net sales increased to EUR 112.3 million (EUR 108.8 million)
- Operating profit increased to EUR 0.9 million (EUR 0.3 million)
- Profit before taxes amounted to EUR 0.1 million (EUR -0.6 million)
- Profit for the period was EUR 0.2 million (EUR 2.7 million)*
- Earnings per share amounted to EUR 0.01 (EUR 0.09)*
*In the first quarter of 2012, the profit included EUR 3.4 million, and the
earnings per share EUR 0.10, as a retroactive additional portion for the
financial year 2011, which was related to tonnage taxation.
The guidance remains unchanged. Aspo aims to increase its operating profit and
to achieve the previous year's level in net sales.
KEY FIGURES
1-3/2013 1-3/2012 1-12/2012
Net sales, MEUR 112.3 108.8 481.6
Operating profit, MEUR 0.9 0.3 10.6
Share of net sales, % 0.8 0.3 2.2
Profit before taxes, MEUR 0.1 -0.6 7.4
Share of net sales, % 0.1 -0.6 1.5
Profit for the period, MEUR 0.2 2.7 10.8
Personnel at the end of period 858 805 871
Earnings per share, EUR 0.01 0.09 0.36
EPS adjusted for dilution, EUR 0.01 0.09 0.37
Equity per share, EUR 2.98 3.13 2.95
Equity ratio, % 29.8 32.9 29.2
Gearing, % 143.1 116.3 131.6
AKI OJANEN, ASPO'S CEO:"Aspo continues to pursue its strategy which is oriented to the growth markets.
Geographically, one-third of the net sales is generated in Russia, Ukraine, and
other CIS countries, one-third in Finland, and one-third in other markets. In
the current global economic situation, we are seeking profitable growth,
particularly in non-EU growth markets. In Finland and the EU in general, we need
to achieve sufficient operational efficiency and profitability in all market
situations.
ESL Shipping has focused on its special expertise in the Baltic Sea and expanded
its operating area to, for instance, the sea ice region in Canada with the new
Supramax vessels. We have substantially improved the shipping company's
profitability. ESL Shipping's first-quarter operating profit was better than in
the comparison periods in 2011 or 2012, but the shipping company's operating
profit did not reach the targets.
Leipurin improved its operating profit in the period under review. The order
book has grown to a record level, which is particularly due to investments made
in the integration of the bakery machinery production facilities and customer
service in 2012. The order book sales will materialize during the rest of the
year. Leipurin continues to invest in modernizing the Russian bakery industry by
way of offering recipes, raw materials, and production equipment through test
bakery operations. The preconditions for organic growth are good.
The prices of raw materials sold by Telko decreased in the first quarter, which
hampered growth and weakened profitability. Considering the lower prices, the
operating profit was good, amounting to EUR 1.5 million (2.0). Our long-term
effort to increase the share of technical plastics has proven to be a correct
decision, since there is less price volatility in these products than in
industrial chemicals or volume plastics.
As a conglomerate, Aspo is able to invest in and develop new business with a
long-term objective. Kaukomarkkinat has continued its investments in broadening
the offering of cleantech exports and energy efficiency solutions for the
Finnish construction sector. Development projects caused expenses, and
Kaukomarkkinat's profit weakened, even though its net sales increased.
Aspo plans to improve cost efficiency in its administration, and Aspo's business
areas are planning to improve the operational efficiency of the Finnish and
European organizations with the aim of improving profitability in the western
markets."
ASPO AS A COMPANY
Aspo is a conglomerate that owns and develops business operations in northern
Europe and growth markets, focusing on demanding B-to-B customers. Aspo's strong
company brands - ESL Shipping, Leipurin, Telko and Kaukomarkkinat - aim to be
market leaders in their sectors. They are responsible for their own operations
and customer relationships, and the development of these. ( )Together they
generate Aspo's goodwill. Aspo's Group structure and business operations are
continually developed without any predefined schedule.
Aspo's operating segments are ESL Shipping, Leipurin, Telko and Kaukomarkkinat.
Other operations consist of Aspo Group's administration and other operations
that do not belong to the business units.
The Group reports its net sales on the basis of the following geographical
division: Finland; Scandinavia; the Baltic countries; Russia, Ukraine and other
CIS countries; and other countries.
OPERATIONAL PERFORMANCE
The uncertainty of global economy has continued, and industrial output in the EU
has decreased from the comparison period. The level of uncertainty concerning
the development of the national economies in the growth markets, such as Russia
and China, has increased. Raw material prices started to decline in the first
quarter. Global prices of dry bulk cargo, which is especially important for the
Group, have increased slightly, but are still at a low level historically. The
first quarter is usually the weakest of the year for Aspo.
ESL Shipping
ESL Shipping is the leading dry bulk cargo company operating in the Baltic Sea
region. At the end of the review period, the company's fleet consisted of 14
vessels, of which the company owned 12 in full. One was leased and one partially
owned.
1-3/2013 1-3/2012 Change 1-12/2012
Net sales, MEUR 19.4 19.9 -0.5 72.3
Operating profit, MEUR 0.5 -0.9 1.4 3.7
Personnel 205 202 3 219
The dry bulk cargo price level has remained low internationally. During the
review period, ESL Shipping's vessels operated mainly in the Baltic Sea, while
the Supramax vessels operated in international traffic. ESL Shipping's
operations in the Baltic Sea are mainly based on long-term contracts.
The cargo volume carried by ESL Shipping in January-March amounted to 2.6
million tons (2.7). Power generation by the energy industry was normal during
the winter. The steel industry continued to operate at reduced capacity, which
decreased the volume of transports for the industry. This was the first winter
in which the Supramax vessels were in traffic since their completion. Because of
the low transport volumes of the contract customers in the Baltic Sea, ESL
Shipping's Supramax vessels have been operating in international traffic in the
Canadian ice region, for example. The shipping company's ice-strengthened
vessels have been an asset in the cargo market. Compared with the comparison
period, the shipping company's capacity was better balanced with the demand.
ESL Shipping's net sales amounted to EUR 19.4 million (19.9). Profitability
improved markedly, with the gross margin amounting to EUR 2.4 million (0.7) and
operating profit to EUR 0.5 million (-0.9).
During the review period, Matti-Mikael Koskinen, M.Sc. (Econ.), was appointed
Managing Director of ESL Shipping as of May 1, 2013.
Leipurin
Leipurin serves the baking and other food industry by supplying ingredients,
production machinery, and production lines, as well as related expertise.
Leipurin operates in Finland, Russia, Poland, the Baltic countries, Ukraine,
Belarus, and Kazakhstan. In Russia, Leipurin has operations in several large
cities in addition to St. Petersburg and Moscow. Procurement operations are
international.
1-3/2013 1-3/2012 Change 1-12/2012
Net sales, MEUR 30.6 30.0 0.6 131.1
Operating profit, MEUR 0.7 0.6 0.1 4.0
Personnel 283 272 11 281
The level of food industry raw material prices has remained unchanged. In
Russia, the prices of cereals have risen to a record level due to a poor harvest
in 2012. Because of the high price level, demand for cereals has decreased in
Russia.
Leipurin's net sales was nearly on par with the previous year's level, amounting
to EUR 30.6 million (30.0). Net sales from bakery raw materials continued to
develop well and net sales increased. As expected, net sales from bakery
machinery were at the same low level as in the comparison period, since the
majority of machinery deliveries occur in the following quarters. Net sales from
bakery raw materials in Russia, Ukraine, and other CIS countries continued at
the same level as in the comparison period.
Leipurin's operating profit increased to EUR 0.7 million (0.6). Operating profit
in Russia is above average.
The 2013 order book of the bakery machinery business is at a record high and,
since the combination of Leipurin's production facilities into a single unit in
Nastola in fall 2012, the prerequisites for production and delivery are good.
The order book of the Finnish industrial sector has also improved, which
predicts improvements in the operating environment of the Finnish bakery
industry.
Telko
Telko is the leading expert and supplier of plastic raw materials and industrial
chemicals in the Baltic Sea region. The company operates in Finland, the Baltic
countries, Scandinavia, Poland, the Czech Republic, Slovakia, Ukraine, Russia,
Belarus, Kazakhstan, Uzbekistan, and China. Procurement operations are
international. Business is based on representation by the best international
principals and on the expertise of the personnel. Telko cooperates with its
regional customers to develop their production and competitiveness.
1-3/2013 1-3/2012 Change 1-12/2012
Net sales, MEUR 53.4 53.0 0.4 237.7
Operating profit, MEUR 1.5 2.0 -0.5 8.4
Personnel 264 232 32 265
The prices of raw materials sold decreased in the review period. Basic
industrial demand declined in Finland and Sweden as industrial output volumes
decreased. In other market areas, demand continued to be normal although prices
were decreasing.
Lower prices notwithstanding, Telko's net sales were at the previous year's
level, amounting to EUR 53.4 million (53.0). Operating profit decreased to EUR
1.5 million (2.0). As part of its operating model, Telko stores products locally
in order to provide a good customer service. Prices decreased in the review
period, which reduced the sales margin of stocked products.
As regards the market areas, the share of emerging markets increased in terms of
net sales and operating profit. Net sales in Russia, Ukraine, and other CIS
countries totaled EUR 24.0 million (21.4), which is 12% more than in the
comparison period. The lower price level of raw materials sold slowed net sales
growth. Operating profit in this market area improved compared with the
comparison period, and it is higher than in other market areas. In order to
support growth in this market area, Telko organized its operations into a unit
corresponding to the area of the customs union between Russia, Kazakhstan and
Belarus, and appointed Juris Avotins, the director responsible for Telko's
operations in the Baltic states and CIS countries, as general director for the
area based in St. Petersburg.
Kaukomarkkinat
Kaukomarkkinat supplies solutions for real estate, energy networks, the
industrial sector and other demanding professional uses, using the best products
available. The goal is to improve the customers' energy efficiency, process
efficiency, and safety, and the profitability of their operations. The business
is based on an in-depth understanding of customer needs, an extensive network of
principals, and solid expertise in different technologies. Kaukomarkkinat
operates in Finland, Russia, Poland, China, and Vietnam.
1-3/2013 1-3/2012 Change 1-12/2012
Net sales, MEUR 8.9 5.9 3.0 40.5
Operating profit, MEUR -0.8 -0.1 -0.7 -0.6
Personnel 94 86 8 94
Kaukomarkkinat's net sales increased and operating profit decreased. The
projects launched by Kaukomarkkinat in 2012 in order to develop the building
systems technology operations (energy efficiency solutions for the construction
sector in Finland) and cleantech exports (Russia and Poland) were associated
with increased costs. Personnel recruitments and the opening and furnishing of a
new center in Koskelo, Espoo, generated further costs. On April 23, 2013,
Kaukomarkkinat initiated co-determination negotiations which cover the entire
Finnish personnel. The aim is to improve the efficiency of the organization as
well as profitability. The personnel impact is estimated at a maximum of 15
employees in Finland. Kaukomarkkinat is also investigating opportunities for
improving the efficiency of its organization outside Finland. In Finland, cost
savings of approximately EUR 1 million annually are targeted.
Other operations
Other operations include Aspo Group's administration and other operations not
belonging to the business units.
1-3/2013 1-3/2012 Change 1-12/2012
Net sales, MEUR 0.0 0.0 0.0 0.0
Operating profit, MEUR -1.0 -1.3 0.3 -4.9
Personnel 12 13 -1 12
The expenses of other operations decreased, amounting to EUR -1.0 million (-
1.3).
NET SALES
Aspo Group's net sales increased EUR 3.5 million, or 3.2%, to EUR 112.3 million
(108.8).
Net sales by segment, MEUR
1-3/2013 1-3/2012 Change 1-12/2012
ESL Shipping 19.4 19.9 -0.5 72.3
Leipurin 30.6 30.0 0.6 131.1
Telko 53.4 53.0 0.4 237.7
Kaukomarkkinat 8.9 5.9 3.0 40.5
Other operations 0.0 0.0 0.0 0.0
Total 112.3 108.8 3.5 481.6
There is no considerable inter-segment net sales.
Net sales by market area, MEUR
1-3/2013 1-3/2012 Change 1-12/2012
Finland 40.7 39.6 1.1 158.9
Scandinavia 10.9 9.5 1.4 42.6
Baltic countries 11.8 11.9 -0.1 49.4
Russia, Ukraine + other CIS countries 31.1 30.3 0.8 157.8
Other countries 17.8 17.5 0.3 72.9
Total 112.3 108.8 3.5 481.6
Net sales growth in Russia, Ukraine and other CIS countries was slight. Net
sales growth was hampered by the lower sales prices of raw materials sold by
Telko and the lack of Leipurin's bakery machine sales in the market area in the
review period.
EARNINGS
Aspo Group's operating profit in January-March amounted to EUR 0.9 million
(0.3). ESL Shipping's operating profit improved substantially to EUR 0.5 million
(-0.9). Leipurin's operating profit increased to EUR 0.7 million (0.6). Telko's
operating profit decreased by EUR 0.5 million to EUR 1.5 million (2.0).
Kaukomarkkinat's operating profit was EUR -0.8 million (-0.1).
Other operations include Aspo Group's administration and a small share of other
items not belonging to the business units. The operating profit of other
operations improved, amounting to EUR -1.0 million (-1.3).
Operating profit by segment, MEUR
1-3/2013 1-3/2012 Change 1-12/2012
ESL Shipping 0.5 -0.9 1.4 3.7
Leipurin 0.7 0.6 0.1 4.0
Telko 1.5 2.0 -0.5 8.4
Kaukomarkkinat -0.8 -0.1 -0.7 -0.6
Other operations -1.0 -1.3 0.3 -4.9
Total 0.9 0.3 0.6 10.6
Earnings per share
Earnings per share were EUR 0.01 (0.09) and diluted earnings per share were EUR
0.01 (0.09). Equity per share was EUR 2.98 (3.13).
The amendment to the tonnage taxation act, which became effective on March
1, 2012, and is applied retroactively from the beginning of 2011, improved
earnings per share by approximately EUR 0.10 in the comparison period. The
positive impact of the tonnage tax can be seen in the profit after taxes for the
period.
ASSETS AND LIABILITIES BY SEGMENT
The assets and liabilities of the business segments are presented in the tables
below.
Segments' assets, MEUR
1-3/2013 1-3/2012 1-12/2012
ESL Shipping 117.7 111.2 116.9
Leipurin 68.9 65.4 69.4
Telko 78.2 74.7 71.7
Kaukomarkkinat 24.4 21.8 28.0
Unallocated items 20.1 22.0 25.2
Total 309.3 295.1 311.2
Segments' liabilities, MEUR
1-3/2013 1-3/2012 1-12/2012
ESL Shipping 9.7 7.7 9.4
Leipurin 18.1 17.5 22.0
Telko 25.1 27.6 24.2
Kaukomarkkinat 6.8 5.5 12.2
Unallocated items 158.6 141.4 153.2
Total 218.3 199.7 221.0
INVESTMENTS
The Group's investments amounted to EUR 0.8 million (16.7), returning to normal
maintenance level. Most of the investments made in the comparison period
consisted of payments for ESL Shipping's Supramax vessel orders.
Investments by segment, acquisitions excluded, MEUR
1-3/2013 1-3/2012 Change 1-12/2012
ESL Shipping 0.1 15.6 -15.5 26.8
Leipurin 0.2 0.1 0.1 1.0
Telko 0.2 1.0 -0.8 2.3
Kaukomarkkinat 0.2 0.0 0.2 0.4
Other operations 0.1 0.0 0.1 0.0
Total 0.8 16.7 -15.9 30.5
FINANCING
The Group's financing position weakened compared to the comparison period.
Compared to the previous quarter, the financing position weakened slightly. The
Group's cash and cash equivalents amounted to EUR 15.6 million (15.2). The
consolidated balance sheet included a total of EUR 145.8 million (126.2) in
interest-bearing liabilities. The growth in interest-bearing liabilities was due
to payments related to ESL Shipping's vessel investments. Non-interest-bearing
liabilities totaled EUR 72.5 million (73.5).
Aspo Group's net gearing was 143.1% (116.3), and the equity ratio was 29.8%
(32.9).
The Group's cash flow from operating activities was negative in the review
period, totaling EUR -10.9 million (-8.1). At the end of the period, the change
in working capital stood at EUR -13.4 million (-9.6). Aspo Group's cash flow
from operations is seasonally weak in the first quarter. Improvements in ESL
Shipping's profitability had a favorable effect on the cash flow from operations
in the review period. The increase in working capital had a negative impact on
the cash flow. The increase in working capital was mainly due to the timing of
Leipurin's and Telko's accounts payable and inventory management.
Cash flow from investments totaled EUR -0.3 million (-15.8); thus, the Group's
free cash flow amounted to EUR -11.2 million (-23.9) in the review period.
The amount of binding revolving credit facilities signed between Aspo and its
core banks stood at EUR 60 million at the end of the period. At the end of the
review period, EUR 10 million of the revolving credit facilities was in use. EUR
28.0 million of Aspo's EUR 50 million commercial paper program was in use at the
end of the period.
Aspo Plc signed a EUR 15 million loan agreement in the review period. The loan
maturity is three years. Through the agreement, Aspo Plc lengthened the maturity
of its loan portfolio. No significant loan agreements will expire in 2013.
Aspo uses an interest rate swap, which is under hedge accounting, to reduce the
interest rate risk. On March 31, 2013, the fair value of the interest rate swap
was EUR -1.0 million. Changes in fair value have been recognized in other
comprehensive items, and the financial instrument is at level 2.
Convertible capital loan
On March 31, 2013, Aspo Plc had EUR 10,300,000 in a convertible capital loan
issued in 2009. The loan period is from June 30, 2009, to June 30, 2014. The
loan will be repaid in one installment on June 30, 2014, assuming that the
repayment conditions outlined in Chapter 12 of the Finnish Companies Act and the
loan terms are met. The loan has a fixed interest rate of 7%.
The loan units can be converted into Aspo shares. Each EUR 50,000 loan unit
entitles its holder to convert the loan unit into 8,074 new shares in Aspo. The
conversion rate is EUR 6.19. The loan can be converted annually between January
2 and November 30. The conversion period ends on June 15, 2014. In January-March
2013, no new shares were subscribed for.
Related party loans
Aspo Plc has granted a EUR 2.9 million loan to Aspo Management Oy, one of the
company's related parties and controlled by the company, as part of a
shareholding plan for the Group. The interest on the loan receivable is 3%. The
loan receivable falls due on March 31, 2014. It can be extended to March
31, 2016 at the latest. The loan is market-based. Aspo Management Oy may not
deposit in pledge or use as security the Aspo Plc shares it holds without Aspo
Plc's written consent. The company has been consolidated in the financial
statements.
RISKS AND RISK MANAGEMENT
The continuing uncertainty of the global economy has increased Aspo's strategic
and operational risks.
Strategic risks are reduced at Group level by the business being divided into
four segments and business being conducted over a wide geographical area.
Strategic risks have increased due to the weaker outlook of metals industry
customers, short-term solutions in the energy sector, and the effects of lower
marine cargo prices on cargo traffic on the Baltic Sea. Investment trends and
changes to retails structures, especially in the western markets, have also
increased the strategic risks. Rapid changes in economic structures may cause
risks due to changes in the customer or principal structure or technologies, and
due to unutilized opportunities that require a quick response.
ESL Shipping adjusted its utilized capacity to meet the demand, giving up the
leased vessels which caused losses in the comparison period. Aspo's other
business areas have continued to centralize their stocks and improve their
product profitability. The efficiency of the monitoring and collection of sales
receivables has been improved. The order book of Leipurin's machinery business
is analyzed more closely, and reporting has been increased further.
Operational risks have increased further due to the uncertainty of the business
environment. The focus of Aspo's growth is on emerging market areas where growth
risks are also affected by factors such as the level of the global market prices
of raw materials, exchange rates, interest rate levels, industrial and
commercial investments, customers' liquidity, and changes in legislation and
import regulations. Consumer behavior is also reflected in the risks generated
through B-to-B customers and the risk levels. The growth opportunities presented
by emerging markets boost interest among competitors in launching or expanding
business in these areas. In addition, the environment in the emerging markets is
challenging. This has led to some competitors exiting these markets, which
creates further opportunities for Aspo. The demand for Aspo's products and
services in Western countries has decreased in proportion to the developing
markets, and macroeconomic factors of uncertainty keep the risk levels high. The
changes in demand in emerging markets show an opposite trend, but as the growth
is slowing, these changes are more difficult to predict.
Aspo has succeeded in keeping its net exchange rate losses small. Active hedging
of currency positions and currency flows has also mostly neutralized the effects
of changes to exchange rates. While changes in credit loss risk vary between
business areas and customers, credit loss risks in general have grown, and to
some extent risks have also been realized.
The quantity and probability of loss risks is assessed regularly. In order to
verify the amounts insured, Aspo reviews and renews its insurance policies
annually. The amounts insured are sufficient, considering the extent of Aspo's
operations.
One of the responsibilities of Aspo's audit committee is to monitor the
efficiency of the Group's internal supervision, internal audits, and risk
management systems. The audit committee monitors the risk management process and
carries out necessary measures to prevent strategic risks in particular. In
accordance with the internal supervision principles approved by the Board of
Directors, risk management is part of Aspo's internal supervision, and its task
is to ensure the implementation of the Group's strategy, development of
financial results, shareholder value, dividend payment ability, and continuity
in business operations. The operational management of the business areas is
responsible for risk management. The management is responsible for specifying
sufficient measures and their implementation, and for monitoring and ensuring
that the measures are implemented as part of day-to-day operational control.
Risk management is coordinated by Aspo's CFO, who reports to the Group CEO.
Aspo Group's financing and financing risk management are centralized in the
parent company in accordance with the financing policy approved by the Board of
Directors.
PERSONNEL
Personnel by segment, period-end
3/2013 3/2012 Change 12/2012
ESL Shipping 205 202 3 219
Leipurin 283 272 11 281
Telko 264 232 32 265
Kaukomarkkinat 94 86 8 94
Other operations 12 13 -1 12
Total 858 805 53 871
At the end of the period, Aspo Group had 858 employees (805). The number of
personnel has increased in Aspo's growth areas, particularly in Russia, Ukraine,
and other CIS countries.
Rewarding
Aspo Group has previously applied a profit bonus system, under which part of the
Group's profit was paid as a profit bonus to the personnel fund. In the first
quarter, the rewarding system was reformed. The profit bonus system was
discontinued and the company adopted a performance bonus program which covers
the entire Finnish personnel. Employees may invest the performance bonus in the
personnel fund or withdraw the bonus in cash. The long-term goal of the funding
system is that the personnel will become a significant shareholder group in the
company. All persons working at Aspo Group's Finnish companies are members of
the personnel fund.
In 2010, Aspo's Board decided on a shareholding plan for Aspo Group's
management. The purpose of the plan is to enable considerable long-term
ownership in Aspo for those involved in the plan. For shareholding purposes, the
participants acquired a company called Aspo Management Oy, whose entire stock
they own. Aspo Management Oy acquired 114,523 Aspo shares from the participants
at market price. In addition, Aspo assigned 322,637 shares at EUR 7.93 per share
to the company in a directed share issue. As part of the arrangement, the Board
decided to grant Aspo Management Oy a EUR 2,800,000 interest-bearing loan to
finance the share purchase. Aspo Management Oy also subscribed to 62,452 shares
in Aspo's rights issue and raised an additional loan of EUR 324,750.40 from Aspo
to finance the purchases. At the end of the reporting period the loan amounted
to EUR 2,934,750.40. The plan is valid until spring 2014, after which it will be
dissolved in a manner to be decided upon later. The plan will be extended for
one year at a time if Aspo's share price at the beginning of 2014, 2015, or
2016 is below the average price at which Aspo Management Oy acquired the Aspo
shares it owns. There are restrictions on the right of disposal of the shares
for the duration of the plan. As a rule, the participants' holding in Aspo
Management Oy remains valid until the system is dissolved.
On February 14, 2012, Aspo's Board of Directors decided on a share-based
incentive plan for about 30 persons. The plan will last for three years, but the
Board of Directors will decide on the performance criteria and participants each
year. The potential reward is based on Aspo Group's earnings per share (EPS) key
figure for each performance year of the plan (2012 to 2014). The prerequisite
for participation in the plan is that the person acquires Aspo shares, or holds
Aspo shares or Aspo Management's shares, up to the number predetermined by the
Board of Directors, and undertakes to follow the rules of the plan. No share
bonus was paid for the 2012 vesting period since Aspo's result remained below
the targeted level. The 2013 vesting period is ongoing.
SHARE CAPITAL AND SHARES
Aspo Plc's share capital on March 31, 2013 was EUR 17,691,729.57 and the total
number of shares was 30,967,450 of which the company held 183,891 shares; that
is, 0.6% of the share capital. Aspo Plc has one share series. Each share
entitles the shareholder to one vote at the shareholders' meeting. Aspo's share
is quoted on NASDAQ OMX Helsinki Ltd's Mid Cap segment under industrial products
and services.
During January-March 2013, a total of 430,683 Aspo Plc shares with a market
value of EUR 2,8 million were traded on NASDAQ OMX Helsinki, in other words,
1.4% of the stock changed hands. During the period, the stock reached a high of
EUR 6.82 and a low of EUR 6.31. The average price was EUR 6.51 and the closing
price at period-end was EUR 6.33. At the end of the period, the market value
excluding treasury shares was EUR 194,9 million.
The number of Aspo Plc shareholders was 6,663 at period-end. A total of 616,076
shares, or 2.0% of the share capital, were nominee registered or held by non-
domestic shareholders.
DECISIONS AT THE ANNUAL SHAREHOLDER'S MEETING
Dividend
The Aspo Plc Annual Shareholders' Meeting on April 10, 2013 adopted the Board of
Directors' proposal for payment of a dividend amounting to EUR 0.42 per share.
The payment date was April 22, 2013.
Board of Directors and Auditor
The Annual Shareholders' Meeting of Aspo Plc re-elected Matti Arteva, Mammu
Kaario, Esa Karppinen, Roberto Lencioni, Gustav Nyberg, Kristina Pentti-von
Walzel and Risto Salo to the Board of Directors for a one-year term. At the
Board's organizing meeting held after the Annual Shareholders' Meeting, Gustav
Nyberg was elected to carry on as Chairman of the Board and Matti Arteva as
Vice-Chairman. At the meeting the Board also decided to appoint Roberto Lencioni
Chairman of the Audit Committee and Mammu Kaario and Kristina Pentti-von Walzel
as committee members.
The authorized public accounting firm Ernst & Young Oy was elected as company
auditor.
Board authorizations
Authorization of the Board of Directors to decide on the acquisition of treasury
shares
The Annual Shareholders' Meeting on April 10, 2013, authorized the Board of
Directors to decide on the acquisition of no more than 500,000 of the treasury
shares using the unrestricted shareholders' equity of the company. The
authorization includes the right to accept treasury shares as a pledge.
The shares shall be acquired through public trading, for which reason the shares
are acquired otherwise than in proportion to the holdings of the shareholders
and the consideration paid for the shares shall be the market price of the
Aspo's share at the time of repurchase. Shares may also be acquired outside
public trading for a price which at most corresponds to the market price in
public trading at the time of acquisition. The authorization includes the
Board's right to resolve on a directed repurchase or the acceptance of shares as
a pledge, if there is a compelling financial reason for the company to do so as
provided for in Chapter 15, section 6 of the Finnish Limited Liability Companies
Act. The shares shall be acquired to be used for the financing or execution of
corporate acquisitions or other transactions, for execution of the company's
share-ownership programs or for other purposes determined by the Board.
The Board may not exercise the authorization to acquire treasury shares or to
accept them as a pledge if after the acquisition the company or its subsidiary
would possess or have as a pledge in total more than ten (10) percent of the
company's stock. The authorization is valid until the Annual Shareholders'
Meeting in 2014 but not more than 18 months from the approval at the
Shareholders' Meeting.
The Board of Directors shall decide on any other matters related to the
acquisition of treasury shares.
The authorization will supersede the authorization for the acquisition of
treasury shares which was granted to the Board of Directors by the Annual
Shareholders' Meeting on April 3, 2012.
Authorization of the Board to decide on a share issue of the treasury shares
The Annual Shareholders' Meeting on April 3, 2012, authorized the Board of
Directors to decide on a share issue, through one or several installments, to be
executed by conveying the treasury shares. An aggregate maximum amount of
834,529 shares may be conveyed based on the authorization. The authorization
will be used for the financing or execution of corporate acquisitions or other
transactions, for execution of the company's share-ownership program or for
other purposes determined by the Board.
The authorization includes the right of the Board of Directors to decide on all
the terms and conditions of the conveyance and thus also includes the right to
convey shares otherwise than in proportion to the holdings of the shareholders,
in deviation from the shareholders' pre-emptive right, if a compelling financial
reason exists for the company to do so. The authorization remains in force until
September 30, 2015.
Treasury shares may be transferred either against or without payment. Under the
Finnish Limited Liability Companies Act, a directed share issue may only be
carried out without payment, if there is an especially compelling reason for the
same, both for the company and in regard to the interests of all shareholders in
the company. The Board of Directors shall decide on any other matters related to
the share issue.
Authorization of the Board to decide on a rights issue
The Annual Shareholders' Meeting on April 3, 2012, authorized the Board of
Directors to decide on a rights issue for consideration. The authorization
includes the right of the Board of Directors to decide on all of the other terms
and conditions of the conveyance and thus also includes the right to decide on a
directed share issue, in deviation from the shareholders' pre-emptive right, if
a compelling financial reason exists for the company to do so. The total number
of new shares to be offered for subscription may not exceed 1,500,000. The
authorization remains in force until September 30, 2015.
EVENTS AFTER THE REPORTING PERIOD
In accordance with the decision made by the Annual Shareholders' Meeting,
shareholders received a dividend of EUR 0.42 per share, totaling EUR
12,929,094.78. The payment date was April 22, 2013.
Matti-Mikael Koskinen, M.Sc. (Econ.), was appointed new Managing Director of ESL
Shipping as of 1 May 2013. He will also serve as a member of the Aspo Group
Executive Committee.
OUTLOOK FOR 2013
Global economic uncertainty and possible economic recession may negatively
affect Aspo's profit development. The decrease in industrial output in the EU,
the predicted decrease in the GDP in 2013, and the possible decrease in raw
material prices will slow the Group's growth. The share of Russia, Ukraine, and
other CIS countries, as well other growth markets such as Poland and China, of
the Group's sales will grow. Aspo expects growth to continue in these market
areas, regardless of the greater uncertainty concerning the growth rates in the
emerging markets. The Group's current structure facilitates profitable organic
growth.
Aspo aims to increase its operating profit and to achieve the previous year's
level in net sales.
ESL Shipping
The shipping company has completed its investment program, and the company's
vessel capacity and operating capacity is now good. ESL Shipping's vessels have
been designed to operate in the Baltic Sea and other Arctic sea ice regions, and
thus the vessel fleet promotes active expansion to new customer groups and
operating areas.
As regards energy coal, transport volumes for the energy industry are expected
to grow from the previous year since stocks as well as Scandinavian water stocks
are low after the winter. Transport volumes for the steel industry are not
expected to grow substantially, since the industry is operating at reduced
capacity. ESL Shipping is preparing for the possibility of lower transport
volumes for the steel industry and to lay up one barge unit. The new market
areas in the northern parts of Canada and Russia are potential future operating
areas for ESL Shipping's vessels. The company is actively investigating
opportunities for profitable trading in new market areas.
ESL Shipping continues its technical and financial planning in preparation for
the sulfur directive, according to the resolution of the International Maritime
Organization (IMO) and scheduled for implementation in 2015. The goal is for the
entire vessel fleet to be capable of operating in the sulfur emission control
areas in the Baltic Sea as well as in the USA and Canada. In Finland,
applications for government financial aid for the purchase, installation, and
operation of sulfur scrubbers must be submitted by May 31, 2013, and
installation must be carried out in 2014.
Leipurin
Profitable organic growth is expected to continue. The new offices create a good
foundation for several years of profitable growth in bakery raw material and
bakery machinery sales. Bakery machinery sales and profitability are expected to
increase markedly from the previous year. Leipurin has expanded its offering of
bakery machinery, paying special attention to the bakery technology and price
competitiveness as required in Eastern growth markets.
Russia's WTO membership is expected to improve the operating conditions of the
food industry, which further supports growth in Russia. In order to improve the
efficiency of its operations and to ensure organic growth in Belarus,
Kazakhstan, and Ukraine, Leipurin is in the process of strengthening its
organization in this market area.
Finland, the Baltic countries, and Poland have been combined into a single
market area under common management. Because of earlier investments in the new
ERP system and new premises in Finland, cost level in 2013 will be even lower
compared with the previous year.
Telko
Telko's growth rate depends on the prices of raw materials sold. The price
levels are associated with some uncertainty due to the uncertainty of the global
economy. Sales volumes are expected to grow further in the eastern growth
markets. Telko continues to expand in Russia, Ukraine, the CIS countries, as
well as China and Poland, in line with its strategy. The company will open new
offices in major Russian cities.
As concerns raw materials sold by Telko, the company aims to further increase
the share of technical plastics compared with industrial chemicals and
automotive chemicals.
Telko focuses on improving the efficiency of its operations in the western
markets and achieving profitable growth in the eastern growth markets. Telko
will develop the sales support functions, customer service, and procurement
organization in Finland in 2013.
Kaukomarkkinat
Kaukomarkkinat's aim is to develop its building systems technology unit into a
leading specialist which offers efficient local energy solutions and services
for new construction and renovation service in Finland. The building up of the
cleantech exports organization in the Russian, Polish and Chinese markets will
continue. The reorganization process launched by Kaukomarkkinat for the purpose
of implementing the chosen strategy in Finland and internationally will improve
the company's operational efficiency. If the planned measures are implemented,
cost efficiency will be realized in the third quarter to some extent, and
particularly in the fourth quarter.
Helsinki, April 29, 2013
ASPO Plc
Board of Directors
ASPO GROUP INCOME STATEMENT
1-3/2013 1-3/2012 1-12/2012
MEUR % MEUR % MEUR %
Net sales 112.3 100.0 108.8 100.0 481.6 100.0
Other operating income 0.3 0.3 0.1 0.1 4.1 0.9
Depreciation and impairment -2.8 -2.5 -2.4 -2.2 -10.8 -2.2
Operating profit 0.9 0.8 0.3 0.3 10.6 2.2
Financial income and expenses -0.8 -0.7 -0.9 -0.8 -3.2 -0.7
Profit before taxes 0.1 0.1 -0.6 -0.6 7.4 1.5
Profit for the period 0.2 0.2 2.7 2.5 10.8 2.2
Other comprehensive income
Other comprehensive income to be
reclassified to profit or loss in
subsequent periods
Translation differences 0.5 1.0 0.6
Cash flow hedges 0.0 -1.2 -1.5
Income tax on other comprehensive income 0.0 0.3 0.4
Other comprehensive income for the period,
net of taxes 0.5 0.1 -0.5
Total comprehensive income 0.7 2.8 10.3
Profit attributable to shareholders 0.2 2.7 10.8
Non-controlling interest 0.0 0.0 0.0
Total comprehensive income attributable to
shareholders 0.7 2.8 10.3
Non-controlling interest 0.0 0.0 0.0
ASPO GROUP BALANCE SHEET
3/2013 3/2012 Change 12/2012
MEUR MEUR % MEUR
Assets
Non-current assets
Intangible assets 14.4 15.8 -8.9 14.7
Goodwill 45.4 45.0 0.9 45.3
Tangible assets 106.4 103.3 3.0 108.3
Available-for-sale assets 0.2 0.2 0.0 0.2
Long-term receivables 3.0 1.5 100.0 3.1
Shares in associated companies 2.2 1.9 15.8 2.2
Total non-current assets 171.6 167.7 2.3 173.8
Current assets
Inventories 53.1 49.2 7.9 50.8
Sales and other receivables 69.0 63.0 9.5 65.2
Cash and bank deposits 15.6 15.2 2.6 21.4
Total current assets 137.7 127.4 8.1 137.4
Total assets 309.3 295.1 4.8 311.2
Shareholders' equity and liabilities
Shareholders' equity
Share capital 17.7 17.7 0.0 17.7
Other shareholders' equity 72.6 77.0 -5.7 71.8
Shareholders' equity attributable to equity
holders of the parent 90.3 94.7 -4.6 89.5
Non-controlling interest 0.7 0.7 0.0 0.7
Long-term liabilities 111.2 121.7 -8.6 96.3
Short-term liabilities 107.1 78.0 37.3 124.7
Total shareholders' equity and liabilities 309.3 295.1 4.8 311.2
STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
A = Share capital F = Translation difference
B = Premium fund G = Retained earnings
C = Fair value fund H = Total
D = Other funds I = Non-controlling interest
E = Repurchased shares J = Total shareholders' equity
MEUR A B C D E F G H I J
Balance at
31.12.2012 17.7 4.3 -0.8 13.7 -4.2 -0.5 59.3 89.5 0.7 90.2
Comprehensive income:
Profit for the period 0.2 0.2
Translation difference 0.5 0.5
Cash flow hedge,
net of taxes 0.0
Total comprehensive income 0.0 0.5 0.2 0.7
Transactions with owners:
Share-based payment 0.1 0.1
Total transactions with
owners 0.1 0.1
Balance at 31.3.2013 17.7 4.3 -0.8 13.7 -4.2 0.0 59.6 90.3 0.7 91.0
Balance at
31.12.2011 17.7 4.3 0.3 26.2 -5.1 -1.1 49.5 91.8 0.7 92.5
Comprehensive income:
Profit for the period 2.7 2.7
Translation difference 1.0 1.0
Cash flow hedge,
net of taxes -0.9 -0.9
Total comprehensive income -0.9 1.0 2.7 2.8
Transactions with owners:
Share-based payment 0.2 0.9 -1.0 0.1
Conversion of convertible
capital loan 0.0
Total transactions with owners 0.2 0.9 -1.0 0.1
Balance at 31.3.2012 17.7 4.3 -0.6 26.4 -4.2 -0.1 51.2 94.7 0.7 95.4
ASPO GROUP CASH FLOW STATEMENT
1-3/2013 1-3/2012 1-12/2012
MEUR MEUR MEUR
OPERATIONAL CASH FLOW
Operating profit 0.9 0.3 10.6
Adjustments to operating profit 2.8 2.7 7.9
Change in working capital -13.4 -9.6 -6.2
Interest paid -0.7 -0.7 -4.0
Interest received 0.1 0.3 1.1
Taxes paid -0.6 -1.1 -0.6
Total operational cash flow -10.9 -8.1 8.8
INVESTMENTS
Investments in tangible and
intangible assets -0.5 -15.7 -29.8
Gains on the sale of tangible and
intangible assets 0.2 4.0
Purchases of subsidiary shares -0.1 -0.2
Purchases of business operations -0.3
Associated companies acquired 0.1
Total cash flow from investments -0.3 -15.8 -26.2
FINANCING
Change in short-term borrowings -9.7 9.8 42.3
Change in long-term borrowings 15.0 14.7 -5.4
Repayment of capital -12.7
Total financing 5.3 24.5 24.2
Increase / Decrease in liquid funds -5.9 0.6 6.8
Liquid funds in beginning of year 21.4 14.5 14.5
Translation difference 0.1 0.1 0.1
Liquid funds at period end 15.6 15.2 21.4
KEY FIGURES AND RATIOS 1-3/2013 1-3/2012 1-12/2012
Earnings per share, EUR 0.01 0.09 0.36
EPS adjusted for
dilution, EUR 0.01 0.09 0.37
Equity per share, EUR 2.98 3.13 2.95
Equity ratio, % 29.8 32.9 29.2
Gearing, % 143.1 116.3 131.6
ACCOUNTING PRINCIPLES AND FINANCIAL REPORTING
Aspo Plc's interim report has been prepared in accordance with the principles of
IAS 34 Interim Financial Reporting. As of 1 January 2013, Aspo applies certain
new or amended IFRS standards and IFRIC interpretations as described in the
2012 financial statements. The adoption of these new or amended standards has
not had any substantial impact on the reported figures. In other respects, the
same accounting principles have been adopted in the interim report as in the
Financial Statements on December 31, 2012. The calculation principles of key
figures are explained on page 98 of the 2012 Annual report. The information in
this report is unaudited.
PRESS AND ANALYST CONFERENCE
A press and analyst conference will be arranged today, Monday April 29, 2013 at
14.30 at the Gallen-Kallela cabinet at Hotel Kämp, Pohjoisesplanadi 29, 00100
Helsinki.
FINANCIAL INFORMATION IN 2013
Aspo Plc will publish the following Interim Reports in 2013:
for the second quarter on August 20, 2013, and
for the third quarter on October 24, 2013.
Helsinki April 29, 2013
ASPO Plc
Aki Ojanen Arto Meitsalo
CEO CFO
For more information:
Aki Ojanen, +358 9 521 4010, +358 400 106 592, aki.ojanen (a)aspo.com
DISTRIBUTION:
NASDAQ OMX Helsinki
Key media
www.aspo.com
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