2013-08-06 07:00:01 CEST
2013-08-06 07:00:05 CEST
REGULATED INFORMATION
Lassila & Tikanoja - Interim report (Q1 and Q3)
Lassila & Tikanoja plc: Interim Report 1 January - 30 June 2013
Helsinki, Finland, 2013-08-06 07:00 CEST (GLOBE NEWSWIRE) --
Net sales for the second quarter EUR 168.9 million (EUR 169.7 million);
operating profit EUR 8.5 million (EUR 14.1 million); operating profit excluding
non-recurring items EUR 13.4 million (EUR 12.1 million); earnings per share EUR
0.14 (EUR 0.24)
Net sales for January-June EUR 336.6 million (EUR 341.0 million); operating
profit EUR 14.8 million (EUR 19.1 million); operating profit excluding
non-recurring items EUR 20.2 million (EUR 17.2 million); earnings per share EUR
0.26 (EUR 0.31)
Non-recurring costs primarily attributable to the EUR 5.0 million write-down on
EcoStream Oy's shares.
Full-year net sales in 2013 are expected to remain at the 2012 level. Operating
profit, excluding non-recurring items, is expected to remain at the 2012 level
or improve slightly.
CEO PEKKA OJANPÄÄ:
“We pursued our strategy implementation in the second quarter, and the
efficiency improvement measures produced the expected results. We were able to
improve our operating profit year-on-year and to generate a strong cash flow.
The current economic uncertainty is reflecting on demand in the industrial
sector and on the material flows in retail trade, which in turn is halting our
net sales growth.”
GROUP NET SALES AND FINANCIAL PERFORMANCE
Second quarter
Lassila & Tikanoja's net sales for the second quarter decreased by 0.5% to EUR
168.9 million (EUR 169.7 million). Operating profit was EUR 8.5 million (EUR
14.1 million), and operating profit excluding non-recurring items was EUR 13.4
million (EUR 12.1 million), representing 7.9% (7.2%) of net sales. Earnings per
share were EUR 0.14 (EUR 0.24).
Comparable net sales includes EUR 3.3 million worth of net sales generated by
L&T Recoil and the divested parts of the eco product business.
Gain from the sale of L&T Recoil shares boosted operating profit by EUR 4.2
million in the comparison period while the non-recurring write-down of EUR 5.0
million on EcoStream Oy shares reduced it in the review period.
January-June
Lassila & Tikanoja's net sales for January-June amounted to EUR 336.6 million
(EUR 341.0 million); an
decrease of 1.3%. Operating profit was EUR 14.8 million (EUR 19.1 million), and
operating profit excluding non-recurring items was EUR 20.2 million (EUR 17.2
million), representing 6.0% (5.0%) of net sales. Earnings per share were EUR
0.26 (EUR 0.31).
Comparable net sales includes EUR 7.3 million worth of net sales generated by
L&T Recoil and the divested parts of the eco product business.
Operating profit was taxed by the non-recurring reorganisation costs of EUR 0.7
million (EUR 2.0 million). Gain from the sale of L&T Recoil shares boosted
operating profit by EUR 4.2 million in the comparison period while the
non-recurring write-down of EUR 5.0 million on EcoStream Oy shares reduced it
in the review period.
Financial summary
4-6/ 4-6/ Change 1-6/ 1-6/ Change 1-12/
2013 2012 % 2013 2012 % 2012
--------------------------------------------------------------------------------
--------------------------------------------
Net sales, EUR million 168.9 169.7 -0.5 336.6 341.0 -1.3 674.0
------------------------------ ------
Operating profit excluding 13.4 12.1 10.0 20.2 17.2 17.1 47.4
non-recurring items, EUR
million*
------------------------------ ------
Operating margin excluding 7.9 7.2 6.0 5.0 7.0
non-recurring items, %
------------------------------ ------
Operating profit, EUR million 8.5 14.1 -40.0 14.8 19.1 -22.5 48.4
------------------------------ ------
Operating margin, % 5.0 8.3 4.4 5.6 7.2
------------------------------ ------
Profit before tax, EUR 7.9 10.8 -26.9 13.8 14.8 -6.6 43.0
million
------------------------------ ------
Earnings per share, EUR 0.14 0.24 -41.7 0.26 0.31 -16.1 0.89
------------------------------ ------
EVA, EUR million 3.4 7.9 -57.0 4.3 6.4 -32.8 24.1
--------------------------------------------------------------------------------
* Breakdown of operating profit excluding non-recurring items is presented
below the division reviews.
NET SALES AND FINANCIAL PERFORMANCE BY DIVISION
Environmental Services
Second quarter
The division's net sales for the second quarter were down by 3.7% to EUR 66.6
million (EUR 69.1 million). Operating profit totalled EUR 9.1 million (EUR 12.4
million) and operating profit excluding non-recurring items was EUR 9.1 million
(EUR 8.7 million).
Comparable net sales includes EUR 3.3 million worth of net sales generated by
L&T Recoil and the divested parts of the eco product business.
Despite the decrease in material flows in the recycling, building and retail
sectors, the division was able to improve its profitability. Efficiency
enhancement measures and effective cost control contributed to the increase in
operating profit.
January-June
The Environmental Services division's net sales for January-June amounted to
EUR 126.8 million (EUR 134.6 million), showing a decrease of 5.8%. Operating
profit totalled EUR 15.3 million (EUR 16.6 million) and operating profit
excluding non-recurring items was EUR 15.3 million (EUR 13.0 million).
Comparable net sales includes EUR 7.3 million worth of net sales generated by
L&T Recoil and the divested parts of the eco product business.
Comparable net sales remained at the comparison period's level even though the
recycling material volume declined following the slowdown in the building and
retail trade sectors. Net sales growth could be attributed to new customer
contracts and positive developments in the waste management business.
Efficiency enhancement measures and effective cost control contributed to the
increase in operating profit.
Industrial Services
Second quarter
The division's net sales for the second quarter totalled EUR 20.0 million (EUR
20.2 million), showing an decrease of 0.8%. Operating profit totalled EUR 1.9
million (EUR 2.2 million) and operating profit excluding non-recurring items
was EUR 1.9 million (EUR 2.5 million).
Demand for industrial services perked up in the second quarter. Meanwhile the
demand for environmental construction and sewer maintenance services remained
weak at the beginning of the second quarter, which had a negative effect on
both net sales and operating profit.
January-June
The division's net sales for January-June totalled EUR 33.7 million (EUR 33.1
million), showing an increase of 2.0%. Operating profit totalled EUR 1.4
million (EUR 0.9 million) and operating profit excluding non-recurring items
was EUR 1.4 million (EUR 1.3 million).
Net sales grew following an increase in demand for process cleaning. Demand for
sewer maintenance services and environmental construction was modest at the
start of the year, but improved towards the end of the review period.
The demand for our hazardous waste services remained strong throughout the
period, helping to maintain a healthy profit level.
Facility Services
Second quarter
The division's net sales for the second quarter were up by 1.4% to EUR 73.4
million (EUR 72.4 million). Operating profit totalled EUR 2.8 million (EUR 1.0
million) and operating profit excluding non-recurring items was EUR 2.9 million
(EUR 2.1 million).
The demand for damage repair services returned to normal and, especially in
Sweden, the profitability of cleaning business improved year-on-year, affecting
the second quarter's operating profit.
January-June
The division's net sales for January-June were down by 1.8% to EUR 149.2
million (EUR 152.0 million). Operating profit totalled EUR 3.3 million (EUR 2.6
million) and operating profit excluding non-recurring items was EUR 3.7 million
(EUR 3.8 million).
The division's net sales declined from the comparison period due to reduced
demand for damage repair services and decline in the Swedish operations.
Costs incurred from the expansion of technical systems services had a negative
effect on profitability, as did the weak demand for damage repair services in
the first half.
The Facility Services division implemented efficiency enhancement measures to
improve its profitability. Profitability improved in the cleaning business,
particularly in Sweden.
Renewable Energy Sources
Second quarter
Second quarter net sales of Renewable Energy Sources (L&T Biowatti) were up by
7.4% to EUR 13.0 million (EUR 12.1 million). The division recorded an operating
profit of EUR 0.1 million (operating loss EUR 0.7 million), and an operating
loss excluding non-recurring items of EUR 0.1 million (operating loss EUR 0.6
million).
The demand for wood-based fuels remained brisk in the second quarter.
Efficiency enhancement measures had a positive impact on the division's
profitability.
January-June
January-June net sales of Renewable Energy Sources (L&T Biowatti) were up by
17.1% to EUR 34.8 million (EUR 29.7 million). Operating profit amounted to EUR
1.1 million (EUR 0.1 million), and operating profit excluding non-recurring
items was EUR 0.9 million (EUR 0.2 million).
There was a significant improvement in the division's net sales from the
comparison period, due to strong demand for wood-based fuels.
Profitability suffered from the weak energy content of fuels and higher
logistics costs. Operating profit improved following net sales growth and the
efficiency improvement measures.
BREAKDOWN OF OPERATING PROFIT EXCLUDING NON-RECURRING ITEMS
EUR million 4-6/ 4-6/ 1-3/ 1-3/ 1-12/
2013 2012 2013 2012 2012
--------------------------------------------------------------------------------
Operating profit 8.5 14.1 14.8 19.1 48.4
Non-recurring items:
Gain on sale of L&T Biowatti Oy -0.3 -0.3
equipment
Impairment of Ecostream Oy shares 5.0 5.0
Gain on sale of holding in L&T -4.2 -4.2 -4.2
Recoil Oy
Impairment of hazardous waste 0.3 0.3 0.5
treatment facilities
Gain on sale of eco product -0.2
business
Restructuring costs 0.2 1.9 0.7 2.0 2.9
--------------------------------------------------------------------------------
Operating profit excluding 13.4 12.1 20.2 17.2 47.4
non-recurring items
FINANCING
Cash flows from operating activities amounted to EUR 44.4 million (EUR 31.6
million). A total of EUR 9.7 million in working capital was released (EUR 2.4
million released).
At the end of the period, interest-bearing liabilities amounted to EUR 89.0
million (EUR 129.5 million). L&T Recoil accounted for EUR 17.7 million of the
interest-bearing liabilities in the reference period. Guarantees of EUR 16.4
million given by Lassila & Tikanoja to other providers of finance for these
liabilities are still in force. In addition L&T had receivables from EcoStream
Group of EUR 3.3 million.
Net interest-bearing liabilities amounted to EUR 73.9 million, showing a
decrease of EUR 8.4 million from the beginning of the year and EUR 38.8 million
from the comparison period.
Net finance costs in the January-June amounted to EUR 1.0 million (EUR 4.3
million). Net finance costs were 0.3% (1.3%) of net sales.
The average interest rate on long-term loans (with interest-rate hedging) was
2.2% (2.5%). Long-term loans totalling EUR 16.2 million will mature during the
rest of the year.
The equity ratio was 47.3% (43.3%) and the gearing rate 33.9 (53.8). Liquid
assets at the end of the period amounted to EUR 15.1 million (EUR 16.7
million).
Of the EUR 100 million commercial paper programme, EUR 15.0 million (EUR 34.0
million) was in use at the end of the period. A committed limit totalling EUR
30.0 million was not in use, as was the case in the comparison period.
DISTRIBUTION OF ASSETS
The Annual General Meeting held on 12 March 2013 resolved that the profit for
2012 be placed in retained earnings and that no dividend be paid. A capital
repayment of EUR 0.60 per share was paid for the financial year 2012. The
capital repayment, totalling EUR 23.2 million, was paid to the shareholders on
22 March 2013.
CAPITAL EXPENDITURE
Capital expenditure for January-June totalled EUR 16.7 million (EUR 27.8
million) and was mainly comprised of machine and equipment purchases.
PERSONNEL
In January-June the average number of employees converted into full-time
equivalents was 8,002 (8,220). The total number of full-time and part-time
employees at the end of the period was 9,567 (9,817). Of them 7,602 (7,689)
people worked in Finland and 1,965 (2,128) people in other countries.
SHARE AND SHARE CAPITAL
Traded volume and price
The volume of trading excluding the shares held by the company in Lassila &
Tikanoja plc shares on NASDAQ OMX Helsinki in January-June was 3,796,733 which
is 9.8% (14.6%) of the average number of outstanding shares. The value of
trading was EUR 49.5 million (EUR 59.1 million). The trading price varied
between EUR 11.60 and EUR 14.19. The closing price was EUR 13.40. The market
capitalisation excluding the shares held by the company was EUR 518.7 million
(EUR 362.1 million) at the end of the period.
Own shares
At the end of the period the company held 92,247 of its own share shares,
representing 0.2% of all shares and votes.
Share capital and number of shares
The company's registered share capital amounts to EUR 19,399,437, and the
number of outstanding shares to 38,706,627 shares. The average number of shares
excluding the shares held by the company totalled 38,701,195.
Share-based incentive programme 2013
Lassila & Tikanoja plc's Board of Directors decided on 17 December 2012 on a
new share-based incentive programme. The programme's earnings period began on 1
January 2013 and ends on 31 December 2013. Potential rewards to be paid for the
year 2013 will be based on the EVA result of Lassila & Tikanoja group.
Potential rewards will be paid partly as shares and partly in cash. A maximum
total of 53,300 Lassila & Tikanoja plc shares may be paid out on the basis of
the programme. The programme covers 10 persons.
Shareholders
At the end of the period, the company had 9,485 (9,525) shareholders.
Nominee-registered holdings accounted for 17.9% (15.3%) of the total number of
shares.
Authorisation for the Board of Directors
The Annual General Meeting held on 12 March 2013 authorised Lassila & Tikanoja
plc's Board of Directors to make decisions on the repurchase of the company's
own shares using the company's unrestricted equity. In addition, the Annual
General Meeting authorised the Board of Directors to decide on the share issue
and the issuance of special rights entitling to shares.
The Board of Directors is authorised to purchase a maximum of 500,000 company
shares, which is 1.3% of the total number of shares. The repurchase
authorisation will be effective for 18 months.
The Board of Directors is authorised to decide on issuance of new shares or
shares possibly held by the Company through share issue and/or issuance of
option rights or other special rights entitling to shares, referred to in
Chapter 10, Section 1 of the Finnish Companies Act, so that by virtue of the
authorisation altogether 500,000 shares, which is 1.3% of the total number of
shares, may be issued and/or conveyed at the maximum. The share issue
authorisation will be effective for 18 months.
RESOLUTIONS BY THE GENERAL MEETING
The Annual General Meeting of Lassila & Tikanoja plc, which was held on 12
March 2013, adopted the financial statements for the financial year 2012 and
released the members of the Board of Directors and the President and CEO from
liability.
The AGM resolved that the profit for 2012 be placed in retained earnings and
that no dividend be paid. A capital repayment of EUR 0.60 per share, as
proposed by the Board of Directors, was paid for the financial year 2012 on the
basis of the balance sheet adopted. The capital repayment, totalling EUR 23.2
million, payment date was on 22 March 2013.
The Annual General Meeting confirmed the number of the members of the Board of
Directors five. The following Board members were re-elected to the Board until
the end of the following AGM: Heikki Bergholm, Eero Hautaniemi, Hille Korhonen,
Sakari Lassila and Miikka Maijala.
KPMG Oy Ab, Authorised Public Accountants, was elected auditor. KPMG Oy Ab
named Lasse Holopainen, Authorised Public Accountant, as its principal auditor.
The resolutions of the Annual General Meeting were announced in more detail in
a stock exchange release on 12 March 2013.
BOARD OF DIRECTORS
The members of the Board of Directors are Heikki Bergholm, Eero Hautaniemi,
Hille Korhonen, Sakari Lassila and Miikka Maijala. In its constitutive meeting
the Board elected Heikki Bergholm as Chairman of the Board and Eero Hautaniemi
as Vice Chairman.
From among its members, the Board elected Eero Hautaniemi as Chairman and
Sakari Lassila and Miikka Maijala as members of the audit committee. Heikki
Bergholm was elected as Chairman of the remuneration committee and Hille
Korhonen as member of the committee.
SUMMARY OF STOCK EXCHANGE RELEASES PURSUANT TO ARTICLE 4, CHAPTER 6 OF THE
SECURITIES MARKETS ACT
In a release published on 25 March 2013, the company announced the comparable
figures for 2012 based on the new business structure.
In a release published on 9 April 2013, the company announced that as part of
EcoStream Oy's capital arrangements, Lassila & Tikanoja plc subscribed for
EcoStream Oy shares for a total of EUR 2.0 million on 8 April 2013. The
subscription price was EUR 3.00 per share. This subscription was financed
through a conversion of Lassila & Tikanoja's remaining sale price receivable
from the L&T Recoil Oy divestment, EUR 2.0 million, into EcoStream Oy shares.
Consequently, the arrangement had no direct impact on cash flow. Following this
arrangement and EcoStream Oy's other capital arrangements, Lassila & Tikanoja's
ownership in EcoStream Oy fell to approximately 16.4 per cent.
In connection with the arrangement, Lassila & Tikanoja's Board of Directors
decided on a write-down of all shares held by Lassila & Tikanoja plc to EUR
3.00 per share. As a result of this write-down, the company will record an
impairment of EUR 5.1 million on EcoStream Oy's shares for the second quarter.
After the write-down, the balance sheet value of the EcoStream shares held by
L&T will be approximately EUR 3.6 million.
The impairment will be treated as a non-recurring cost item, with no impact on
cash flow.
EVENTS AFTER THE PERIOD
In a release published on 1 July 2013, the company announced that the
consideration of charges relating to L&T's overtime investigation was complete.
The police investigation and the consideration of charges were aimed at the
overtime work of 25 of L&T's property maintenance employees. On the basis of
the consideration of charges, the District Prosecutor for Helsinki has decided
to press charges against 21 former and current management staff at Lassila &
Tikanoja, including Pekka Ojanpää, President and CEO since 1 November 2011.
NEAR-TERM RISKS AND UNCERTAINTIES
Economic uncertainty may cause major changes in the Environmental Services
division's secondary raw material markets and in the Industrial Services
division's demand.
Uncertainties associated with government subsidies for renewable fuels and with
their continuity could affect demand for the Renewable Energy Sources
division's services.
More detailed information on L&T's risks and risk management is available in
the Annual Report for 2012, in the report of the Board of Directors, and in the
consolidated financial statements.
OUTLOOK FOR THE REST OF THE YEAR
Full-year net sales in 2013 are expected to remain at the 2012 level. Operating
profit, excluding non-recurring items, is expected to remain at the 2012 level
or improve slightly.
CONDENSED FINANCIAL STATEMENTS 1 JANUARY-30 JUNE 2013
CONSOLIDATED INCOME STATEMENT
EUR 1 000 4-6/ 4-6/ 1-6/ 1-6/ 1-12/
2013 2012 2013 2012 2012
--------------------------------------------------------------------------------
Net sales 168 882 169 692 336 603 340 978 673 985
Cost of sales -149 488 -151 299 -303 855 -311 010 -602 581
--------------------------------------------------------------------------------
Gross profit 19 394 18 393 32 748 29 968 71 404
Other operating income 1 368 5 011 1 746 5 559 7 708
Selling and marketing costs -3 764 -4 945 -7 404 -9 036 -16 745
Administrative expenses -2 991 -3 408 -6 237 -6 416 -12 090
Other operating expenses -499 -605 -1 047 -696 -1 584
Impairment, non-current assets -5 027 -302 -5 027 -302 -302
Impairment, goodwill and other
intangible assets
--------------------------------------------------------------------------------
Operating profit 8 481 14 144 14 779 19 077 48 391
Finance income 110 148 231 503 860
Finance costs -700 -3 504 -1 229 -4 819 -6 256
--------------------------------------------------------------------------------
Profit before tax 7 891 10 788 13 781 14 761 42 995
Income tax expense -2 407 -1 447 -3 850 -2 656 -8 543
--------------------------------------------------------------------------------
Profit for the period 5 484 9 341 9 931 12 105 34 452
Attributable to:
Equity holders of the company 5 484 9 342 9 935 12 111 34 459
Non-controlling interest 0 -1 -4 -6 -7
Earnings per share for profit
attributable to the equity
holders of the company:
Basic earnings per share, EUR 0.14 0.24 0.26 0.31 0.89
Diluted earnings per share, 0.14 0.24 0.26 0.31 0.89
EUR
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
EUR 1 000 4-6/ 4-6/ 1-6/ 1-6/ 1-12/
2013 2012 2013 2012 2012
--------------------------------------------------------------------------------
Profit for the period 5 484 9 341 9 931 12 105 34 452
Other comprehensive income, after
tax
Items arising from re-measurement -189
of defined benefit plans
--------------------------------------------------------------------------------
Total 0 0 0 0 -189
Hedging reserve, change in fair -1 213 348 -256 657 1 098
value
Revaluation reserve
Gains in the period -1 0 -2 3 2
--------------------------------------------------------------------------------
Current available-for-sale -1 0 -2 3 2
financial assets
Currency translation differences -1 081 -601 -831 80 627
Currency translation differences, -20 -15 -16 3 10
non-controlling interest
--------------------------------------------
Other comprehensive income, after -2 315 -268 -1 105 743 1 737
tax
--------------------------------------------------------------------------------
Total comprehensive income, after 3 169 9 073 8 826 12 848 36 000
tax
Attributable to:
Equity holders of the company 3 189 9 089 8 846 12 851 35 997
Non-controlling interest -19 -16 -20 -3 3
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
EUR 1 000 6/2013 6/2012 12/2012
--------------------------------------------------------------------------------
ASSETS
Non-current assets
Intangible assets
Goodwill 119 917 119 735 120 189
Customer contracts arising from acquisitions 6 396 9 027 7 880
Agreements on prohibition of competition 1 079 2 534 1 810
Other intangible assets arising from business 46 67 57
acquisitions
Other intangible assets 8 580 8 968 8 494
--------------------------------------------------------------------------------
136 018 140 331 138 430
Property, plant and equipment
Land 3 746 4 129 3 844
Buildings and constructions 49 957 47 604 52 393
Machinery and equipment 116 732 122 185 121 179
Other 85 85 86
Prepayments and construction in progress 4 352 5 423 2 657
--------------------------------------------------------------------------------
174 872 179 426 180 159
Other non-current assets
Available-for-sale investments 4 254 7 293 7 284
Finance lease receivables 3 623 3 848 3 608
Deferred tax assets 3 447 3 713 3 845
Other receivables 5 823 2 946 2 755
--------------------------------------------------------------------------------
17 147 17 800 17 492
Total non-current assets 328 037 337 557 336 081
Current assets
Inventories 26 044 26 941 24 884
Trade and other receivables 100 963 107 862 103 925
Derivative receivables 382 113 1 290
Prepayments 1 838 2 688 491
Current available-for-sale financial assets 6 997 2 499
Cash and cash equivalents 15 078 9 739 12 083
--------------------------------------------------------------------------------
Total current assets 144 305 154 340 145 172
TOTAL ASSETS 472 342 491 897 481 253
--------------------------------------------------------------------------------
EUR 1 000 6/2013 6/2012 12/2012
-------------------------------------------------------------------------------
EQUITY AND LIABILITIES
Equity
Equity attributable to equity holders of the company
Share capital 19 399 19 399 19 399
Share premium reserve
Other reserves -1 832 -1 729 -743
Unrestricted equity reserve 6 103 29 381 29 381
Retained earnings 184 216 150 200 150 233
Profit for the period 9 935 12 111 34 459
-------------------------------------------------------------------------------
217 821 209 362 232 729
Non-controlling interest 254 268 274
-------------------------------------------------------------------------------
Total equity 218 075 209 630 233 003
Liabilities
Non-current liabilities
Deferred tax liabilities 30 637 30 301 31 313
Retirement benefit obligations 894 667 672
Provisions 4 194 2 589 4 304
Borrowings 46 724 74 208 57 961
Other liabilities 879 1 021 942
----------------------------------------------------- -----------------
83 328 108 786 95 192
---------
Current liabilities
Borrowings 42 293 55 260 38 915
Trade and other payables 127 648 116 630 112 880
Derivative liabilities 677 859 1 129
Tax liabilities 13 14
Provisions 321 719 120
-------------------------------------------------------------------------------
170 939 173 481 153 058
Total liabilities 254 267 282 267 248 250
TOTAL EQUITY AND LIABILITIES 472 342 491 897 481 253
-------------------------------------------------------------------------------
CONSOLIDATED STATEMENT OF CASH FLOWS
EUR 1 000 6/2013 6/2012 12/2012
--------------------------------------------------------------------------------
Cash flows from operating activities
Profit for the period 9 931 12 105 34 452
Adjustments
Income tax expense 3 850 2 657 8 543
Depreciation, amortisation and impairment 26 117 22 123 43 642
Finance income and costs 998 4 315 5 395
Gain on sale of shares -4 413 -4 181
Other -589 448 1 603
--------------------------------------------------------------------------------
Net cash generated from operating activities before 40 307 37 235 89 454
change in working capital
Change in working capital
Change in trade and other receivables -3 593 -17 313 -10 574
Change in inventories -1 156 -2 177 -121
Change in trade and other payables 14 478 21 853 17 096
--------------------------------------------------------------------------------
Change in working capital 9 729 2 363 6 401
Interest paid -1 267 -3 036 -5 070
Interest received 240 526 830
Income tax paid -4 640 -5 523 -11 127
--------------------------------------------------------------------------------
Net cash from operating activities 44 369 31 565 80 488
Cash flows from investing activities
Acquisition of subsidiaries and businesses, net of -807 -2 498
cash acquired
Proceeds from sale of subsidiaries and businesses, 7 820 7 820
net of sold cash
Purchases of property, plant and equipment and -14 093 -21 381 -40 659
intangible assets
Proceeds from sale of property, plant and equipment 781 255 2 826
and intangible assets
Purchases of available-for-sale investments
Change in other non-current receivables 198 368 560
Proceeds from sale of available-for-sale investments
Dividends received 1 1
--------------------------------------------------------------------------------
Net cash used in investing activities -13 114 -13 744 -31 950
Cash flows from financing activities
Change in short-term borrowings 2 997 16 087 -5 781
Proceeds from long-term borrowings 10 200 10 200
Repayments of long-term borrowings -10 425 -14 197 -25 254
Dividends paid and other asset distribution -23 197 -21 254 -21 254
Repurchase of own shares
--------------------------------------------------------------------------------
Net cash generated from financing activities -30 625 -9 164 -42 089
EUR 1 000 6/2013 6/2012 12/2012
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Net change in liquid assets 630 8 657 6 449
Liquid assets at beginning of period 14 582 8 069 8 069
Effect of changes in foreign exchange rates -134 10 64
Change in fair value of current available-for-sale
investments
--------------------------------------------------------------------------------
Liquid assets at end of period 15 078 16 736 14 582
Liquid assets
EUR 1 000 6/2013 6/2012 12/2012
--------------------------------------------------------------------------------
Cash and cash equivalents 15 078 9 739 12 083
Available-for-sale financial assets 6 997 2 499
--------------------------------------------------------------------------------
Total 15 078 16 736 14 582
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
EUR 1 Share Share Cur-re Reva-l Hedgin Investe Re-tain Equity
Non-co Total
000 capita premiu ncy uation g d ed attribu
ntroll equity
l m transl reserv reserv unrestr earning table
ing
reserv a-tion e e ic-ted s to
intere
e differ equity equity
st
-ences reserve holders
of the
company
--------------------------------------------------------------------------------
----------
Equity 19 399 0 -785 2 41 29 381 184 692 232 729
274 233 003
at
1.1.2
013
Amendm -189 -189
-189
ent in
IAS19
--------------------------------------------------------------------------------
----------
Equity 19 399 0 -785 2 41 29 381 184 503 232 540
274 232 814
at
1.1.2
013
Expens 18 18
18
e
recog
nition
of
share
-based
benef
its
Capita -23 278 299 -22 979
-22 979
l
repay
ment
Total -831 -2 -256 9 935 8 846
-20 8 826
compr
ehensi
ve
incom
e
Other -604 -604
-604
diffe
rences
--------------------------------------------------------------------------------
----------
--------------------------------------------------------------------------------
----------
Equity 19 399 0 -1 616 0 -215 6 103 194 151 217 821
254 218 075
at
30.6.
2013
Equity 19 399 0 -1 412 0 -1 057 50 658 150 085 217 673
271 217 944
at
1.1.2
012
Amendm 93 93
93
ent in
IAS19
--------------------------------------------------------------------------------
----------
Expens
0
e
recog
nition
of
share
-based
benef
its
Capita -21 277 22 -21 255
-21 255
l
repay
ment
Total 80 3 657 12 111 12 851
-3 12 848
compr
ehensi
ve
incom
e
--------------------------------------------------------------------------------
----------
--------------------------------------------------------------------------------
----------
Equity 19 399 0 -1 332 3 -400 29 381 162 311 209 362
268 209 630
at
30.6.
2012
KEY FIGURES
4-6/ 4-6/ 1-6/ 1-6/ 1-12/
2013 2012 2013 2012 2012
--------------------------------------------------------------------------------Earnings per share, EUR 0.14 0.24 0.26 0.31 0.89
Earnings per share, diluted, EUR 0.14 0.24 0.26 0.31 0.89
Cash flows from operating activities 0.45 0.59 1.15 0.82 2.08
per share, EUR
EVA, EUR million 3.4 7.9 4.3 6.4 24.1
Capital expenditure, EUR 1000 10 737 16 359 16 656 27 833 49 385
Depreciation, amortisation and 15 540 11 297 26 118 22 123 43 641
impairment, EUR 1000
Equity per share, EUR 5.63 5.41 6.01
Return on equity, ROE, % 8.8 11.3 15.3
Return on invested capital, ROI, % 9.4 11.3 14.4
Equity ratio, % 47.3 43.3 49.4
Gearing, % 33.9 53.8 35.3
Net interest-bearing liabilities, EUR 73 939 112 732 82 294
1000
Average number of employees in 8 002 8 220 8 399
full-time equivalents
Total number of full-time and 9 567 9 817 8 962
part-time employees at end of period
Number of outstanding shares adjusted
for issues, 1000 shares
average during the period 38 701 38 686 38 688
at end of period 38 707 38 686 38 692
average during the period, diluted 38 710 38 709 38 701
ACCOUNTING POLICIES
This interim report release is in compliance with IAS 34 standard. The same
accounting policies as in the annual financial statements for the year 2012
have been applied. The following new, revised or amended IFRS standards and
IFRIC interpretations that have become effective in 2013 have not had an impact
on the financial statements:
- IAS 19 (Amendment) Employee Benefits
Key changes: The amendment eliminates the use of the 'corridor'approach. The
definition of estimated return on funded defined benefit plan assets will
change. Financial cost is determined on the net assets (included in the
obligation and in the plan). Impact on statement of financial position on 31
December 2012 and statement of comprehensive income for the period 1 January
2012-31 December 2012 EUR 189 thousand.
- IFRS 13 Fair Value Measurement
The new standard sets out the requirement to determine fair value and to
disclose related information in the financial statements; the new standard also
includes a definition of fair value. The use of fair value is not extended, but
the standard offers guidelines for value definition when another standard
requires or permits fair value measurements. IFRS 13 extends the disclosure
requirement for assets measured at fair value not included in financial assets.
The EU has not yet approved the new standard for application. The new standard
is not expected to have a material impact on consolidated financial statements.
- IFRS 7 Financial Instruments: Disclosures - Offsetting Financial Assets and
Financial Liabilities
The amendment includes more extensive disclosure requirements; entities are
required to disclose numerical information on financial assets presented in net
amount in the statement of financial position, and on financial assets subject
to master netting arrangements or similar agreements, even if presented in
gross amount in the statement of financial position. The amendment will be
adopted for application in the 2013 financial statements. The required
disclosures must be presented retrospectively. The amendment has not yet been
approved for application in the EU. The amendment does not have a material
impact on the consolidated financial statements. The preparation of financial
statements in accordance with IFRS requires the management to make estimates
and assumptions that affect the carrying amounts on the balance sheet date for
assets and liabilities and the amounts of revenues and expenses. In addition,
the management makes judgements when making decisions
on application of accounting policies. Actual results may differ from the
estimates and assumptions.
The interim report has not been audited.
SEGMENT INFORMATION
Net sales
4-6/201 4-6/201
3 2
--------- -------------
EUR 1 000 Externa Inter-d Total Externa Inter-d Total Total net
l ivision l ivision sales,
change %
--------------------------------------------------------------------------------
Environmenta 65 694 903 66 597 67 771 1 365 69 136 -3.7
l Services
--------- -------------
Industrial 18 908 1 094 20 002 19 388 770 20 158 -0.8
Services
--------- -------------
Facility 72 309 1 086 73 395 71 436 940 72 376 1.4
Services
--------- -------------
Renewable 11 971 1 020 12 991 11 097 1 002 12 099 7.4
Energy
Sources
--------- -------------
Eliminations -4 103 -4 103 -4 077 -4 077
--------------------------------------------------------------------------------
L&T total 168 882 0 168 882 169 692 0 169 692 -0.5
--------- -------------
1-6/201 1-6/201
3 2
--------- -------------
EUR 1 000 Externa Inter-d Total Externa Inter-d Total Total net
l ivision l ivision sales,
change %
--------------------------------------------------------------------------------
Environmenta 124 801 1 997 126 798 131 543 3 060 134 603 -5.8
l Services
--------- -------------
Industrial 31 988 1 744 33 732 31 577 1 504 33 081 2.0
Services
--------- -------------
Facility 147 100 2 091 149 191 150 222 1 774 151 996 -1.8
Services
--------- -------------
Renewable 32 714 2 047 34 761 27 636 2 047 29 683 17.1
Energy
Sources
--------- -------------
Eliminations -7 879 -7 879 -8 385 -8 385
--------------------------------------------------------------------------------
L&T total 336 603 0 336 603 340 978 0 340 978 -1.3
--------- -------------
1-12/2012
EUR 1 000 External Inter-division Total
-----------------------------------------------------------
Environmental Services 259 791 5 870 265 661
Industrial Services 66 863 3 133 69 996
Facility Services 295 451 4 042 299 493
Renewable Energy Sources 51 880 4 067 55 947
Eliminations -17 112 -17 112
-----------------------------------------------------------
L&T total 673 985 0 673 985
Operating profit
EUR 1 000 4-6/ % 4-6/ % 1-6/ % 1-6/ % 1-12/ %
2013 2012 2013 2012 2012
--------------------------------------------------------------------------------
Environmen 9 059 13.6 12 368 17.9 15 283 12.1 16 640 12.4 34 251 12.9
tal
Services
Industrial 1 895 9.5 2 199 10.9 1 376 4.1 942 2.8 3 892 5.6
Services
Facility 2 830 3.9 1 025 1.4 3 259 2.2 2 621 1.7 12 980 4.3
Services
Renewable 94 0.7 -733 -6.1 1 061 3.1 54 0.2 -61 -0.1
Energy
Sources
Group -5 397 -715 -6 200 -1 180 -2 671
admin.
and other
--------------------------------------------------------------------------------
L&T total 8 481 5.0 14 144 8.3 14 779 4.4 19 077 5.6 48 391 7.2
Finance -590 -3 356 -998 -4 316 -5 396
costs,
net
--------------------------------------------------------------------------------
Profit 7 891 10 788 13 781 14 761 42 995
before
tax
Other segment information
EUR 1 000 6/2013 6/2012 12/2012
---------------------------------------------------
Assets
Environmental Services 220 751 239 502 228 457
Industrial Services 74 761 82 294 81 573
Facility Services 114 236 105 588 105 718
Renewable Energy Sources 26 665 28 838 30 179
Group admin. and other 10 823 9 704 9 853
Unallocated assets 25 106 25 971 25 473
---------------------------------------------------
L&T total 472 342 491 897 481 253
Liabilities
Environmental Services 51 375 44 270 42 381
Industrial Services 22 199 19 431 18 687
Facility Services 51 791 49 397 50 073
Renewable Energy Sources 7 268 7 060 6 094
Group admin. and other 1 052 1 054 1 378
Unallocated assets 120 582 161 055 129 637
---------------------------------------------------
L&T total 254 267 282 267 248 250
EUR 1 000 4-6/ 4-6/ 1-6/ 1-6/ 1-12/
2013 2012 2013 2012 2012
---------------------------------------------------------------------
Capital expenditure
Environmental Services 4 885 3 774 7 357 8 055 16 149
Industrial Services 1 071 2 598 1 585 4 499 11 272
Facility Services 2 846 3 050 5 541 8 242 14 727
Renewable Energy Sources 37 233 82 330 486
Group admin. and other 1 898 6 704 2 091 6 707 6 751
---------------------------------------------------------------------
L&T total 10 737 16 359 16 656 27 833 49 385
Depreciation and amortisation
Environmental Services 5 464 6 436 11 059 12 798 24 690
Industrial Services 1 684 1 676 3 347 3 320 7 084
Facility Services 3 287 2 813 6 526 5 561 11 276
Renewable Energy Sources 75 66 152 138 281
Group admin. and other 3 4 7 4 9
---------------------------------------------------------------------
L&T total 10 513 10 995 21 091 21 821 43 340
Impairment
Environmental Services 302 302 302
Group admin. and other 5 027 5 027
---------------------------------------------------------------------
---------------------------------------------------------------------
L&T total 5 027 302 5 027 302 302
INCOME STATEMENT BY QUARTER
EUR 1 000 4-6/ 1-3/ 10-12/ 7-9/ 4-6/ 1-3/
2013 2013 2012 2012 2012 2012
------------------------------------------------------------------------------
Net sales
Environmental Services 66 597 60 201 64 670 66 388 69 136 65 467
Industrial Services 20 002 13 730 18 770 18 145 20 158 12 923
Facility Services 73 395 75 796 74 789 72 708 72 376 79 620
Renewable Energy Sources 12 991 21 770 18 287 7 977 12 099 17 584
Group admin. and other
Inter-division net sales -4 103 -3 776 -4 725 -4 002 -4 077 -4 308
------------------------------------------------------------------------------
L&T total 168 882 167 721 171 791 161 216 169 692 171 286
Operating profit
Environmental Services 9 059 6 224 6 592 11 019 12 368 4 272
Industrial Services 1 895 -519 1 161 1 789 2 199 -1 257
Facility Services 2 830 429 2 516 7 843 1 025 1 596
Renewable Energy Sources 94 967 269 -384 -733 787
Group admin. and other -5 397 -803 -853 -638 -715 -465
------------------------------------------------------------------------------
L&T total 8 481 6 298 9 685 19 629 14 144 4 933
Operating margin
Environmental Services 13.6 10.3 10.2 16.6 17.9 6.5
Industrial Services 9.5 -3.8 6.2 9.9 10.9 -9.7
Facility Services 3.9 0.6 3.4 10.8 1.4 2.0
Renewable Energy Sources 0.7 4.4 1.5 -4.8 -6.1 4.5
------------------------------------------------------------------------------
-------------------------
L&T total 5.0 3.8 5.6 12.2 8.3 2.9
Finance costs, net -590 -408 -512 -568 -3 356 -960
------------------------------------------------------------------------------
Profit before tax 7 891 5 890 9 173 19 061 10 788 3 973
BUSINESS ACQUISITIONS
In January-June 2013 Lassila & Tikanoja made no business acquisitions.
The accounting policy concerning business combinations is presented in Annual
Report under Note 2 of the consolidated financial statements and under Summary
on significant accounting policies.
CHANGES IN INTANGIBLE ASSETS
EUR 1 000 1-6/2013 1-6/2012 1-12/2012
---------------------------------------------------------------------
Carrying amount at beginning of period 138 430 144 489 144 489
Business acquisitions 356 1 110
Other capital expenditure 1 466 954 2 322
Disposals -1 455 -1 957
Amortisation and impairment -3 570 -4 221 -8 023
Transfers between items
Exchange differences -308 208 489
---------------------------------------------------------------------
Carrying amount at end of period 136 018 140 331 138 430
CHANGES IN PROPERTY, PLANT AND EQUIPMENT
EUR 1 000 1-6/2013 1-6/2012 1-12/2012
---------------------------------------------------------------------
Carrying amount at beginning of period 180 159 207 522 207 522
Business acquisitions 515 2 438
Other capital expenditure 13 189 19 303 36 810
Disposals -525 -30 143 -31 258
Depreciation and impairment -17 521 -17 902 -35 619
Transfers between items
Exchange differences -430 131 266
---------------------------------------------------------------------
Carrying amount at end of period 174 872 179 426 180 159
CAPITAL COMMITMENTS
EUR 1 000 1-6/2013 1-6/2012 1-12/2012
-----------------------------------------------------------------------
Intangible assets 220 109
Property, plant and equipment 4 279 5 050 1 953
-----------------------------------------------------------------------
Total 4 279 5 270 2 062
The Group's share of capital commitments
RELATED-PARTY TRANSACTIONS
(Joint ventures)
EUR 1 000 1-6/2013 1-6/2012 1-12/2012
------------------------------------------------------
Sales 939 939
Other operating income 24 24
Interest income 391 391
Non-current receivables
Capital loan receivable 0 0
Current receivables
Trade receivables 0 0
Loan receivables 0 0
FINANCIAL ASSETS AND LIABILITIES BY CATEGORY
EUR 1 Financial Loans Availab Financi Deriva Carryin Fair Fair
000 assets and and le-for- al tives g values value
liabilitie other sale liabili under amounts by hierar
s at fair receiva financi ties hedge by balance chy
value bles al measure accoun balance sheet level
through assets d at ting sheet item under
profit or amortis item IFRS 7
loss ed cost
--------------------------------------------------------------------------------
Non-cur
rent
financ
ial
assets
Availab 4 253 4 253 4 253 3
le-for-
sale
invest
ments
Finance 3 623 3 623 3 826
lease
receiv
ables
Other 5 822 5 822 5 822
receiv
ables
Current
financ
ial
assets
Trade 90 556 90 556 90 556
and
other
receiv
ables
Derivat 382 382 382 2
ive
receiv
ables
Availab 2
le-for-
sale
financ
ial
assets
Cash 15 078 15 078 15 078
and
cash
equiva
lents
--------------------------------------------------------------------------------
Total 115 079 4 253 382 119 714 119 917
financ
ial
assets
Non-cur
rent
financ
ial
liabil
ities
Borrowi 46 725 46 725 46 893
ngs
Other 561 561 561
liabil
ities
Current
financ
ial
liabil
ities
Borrowi 42 294 42 294
ngs
Trade 61 971 61 971
and
other
payabl
es
Derivat 677 677 677 2
ive
liabil
ities
--------------------------------------------------------------------------------
Total 151 551 677 152 228 48 131
financ
ial
liabil
ities
CONTINGENT LIABILITIES
Securities for own commitments
EUR 1 000 6/2013 6/2012 12/2012
---------------------------------------------------------------------------
Mortgages on rights of tenancy 186 186 186
Company mortgages 583 460 583
Other securities 180 200 178
Bank guarantees required for environmental permits 8 694 5 848 6 483
Other securities are security deposits.
Off balance sheet liabilities
Lassila & Tikanoja plc has given a guarantee for a share of 50 percent of L&T
Recoil Oy's financial
liabilities.
The guarantee is valid no later than the maturity date of the liabilities on 31
August 2014.
The financial liabilities of L&T Recoil totalled EUR 32.8 million on 30 June
2013.
Operating lease liabilities
EUR 1 000 6/2013 6/2012 12/2012
--------------------------------------------------------------------------------
Maturity not later than one year 5 129 6 332 5 556
Maturity later than one year and not later than five 6 700 10 470 8 377
years
Maturity later than five years 2 183 2 443 2 274
--------------------------------------------------------------------------------
Total 14 012 19 245 16 206
Liabilities associated with derivative agreements
Interest rate swaps
EUR 1 000 6/2013 6/2012 12/2012
--------------------------------------------------------------------------------
Nominal values of interest rate and currency swaps*
Maturity not later than one year 17 824 14 229
Maturity later than one year and not later than five 20 339 28 940
years
Maturity later than five years 1 818 2 727
--------------------------------------------------------------------------------
Total 39 981 0 45 896
Fair value -630 -1 129
Nominal value of interest rate swaps**
Maturity not later than one year 4 000 0
Maturity later than one year and not later than five 18 364 0
years
Maturity later than five years 3 636 0
--------------------------------------------------------------------------------
Total 0 26 000 0
Fair value -314 0
* The interest rate swaps are used to hedge cash flow related to a floating
rate loan, and hedge accounting under IAS 39 has been applied to it. The hedges
have been effective, and the changes in the fair values are shown in the
consolidated statement of comprehensive income for the period. The fair values
of the swap contracts are based on the market data at the balance sheet date.
** Hedge accounting under IAS 39 has not been applied to these interest rate
swaps. Changes in fair values have been recognised in finance income and costs.
Commodity derivatives
metric tonnes 6/2013 6/2012 12/2012
--------------------------------------------------------------------------------
Nominal values of diesel swaps
Maturity not later than one year 4524 3 816 5 136
Maturity later than one year and not later than five 0 1 272 660
years
--------------------------------------------------------------------------------
Total 4 524 5 088 5 796
Fair value, EUR 1000 -47 112 136
Commodity derivative contracts were concluded, for hedging of future diesel oil
purchases. IAS 39 -compliant hedge accounting will be applied to these
contracts, and the effective change in fair value will be recognised in the
hedging reserve within equity. The fair values of commodity derivatives are
based on market prices at the balance sheet date.
Currency forwards
EUR 1 000 6/2013 6/2012 12/2012
---------------------------------------------------------
Volume of forward contracts
Maturity not later than one year 0 0 775
Fair value 0 0 4
Hedge accounting under IAS 39 has not been applied to forward contracts.
Changes in fair values have been recognised in finance income and costs.
Cross currency interest rate swaps
EUR 1 000 6/2013 6/2012 12/201
2
--------------------------------------------------------------------------------
Maturity of cross currency interest rate swaps under
hedge accounting
Maturity not later than one year 11 200 12 444 12 800
Maturity later than one year and not later than five 13 067 22 596 16 667
years
--------------------------------------------------------------------------------
Total 24 267 35 040 29 467
Fair value, EUR 1 000 382 -545 1 150
The contracts are used to hedge cash flow related to foreign currency floating
rate loans. The changes in the fair values are shown in the consolidated
statement of comprehensive income for the period. On the balance sheet date,
the value of foreign currency loans was EUR 0.4 million negative.
CALCULATION OF KEY FIGURES
Earnings per share:
profit attributable to equity holders of the parent company / adjusted average
basic number of shares
Earnings per share, diluted:
profit attributable to equity holders of the parent company / adjusted average
diluted number of shares
Cash flows from operating activities/share:
cash flow from operating activities as in the statement of cash flows /
adjusted average number of shares
EVA:
operating profit - cost calculated on invested capital (average of four
quarters)
WACC 2012: 7.1%
WACC 2013: 6.5%
Equity per share:
equity attributable to equity holders of the parent company / adjusted basic
number of shares at end of period
Return on equity, % (ROE):
(profit for the period / equity (average)) x 100
Return on investment, % (ROI):
(profit before tax + finance costs) / (total equity and liabilities -
non-interest-bearing liabilities (average)) x 100
Equity ratio, %:
equity / (total equity and liabilities - advances received) x 100
Gearing, %:
net interest-bearing liabilities / equity x 100
Net interest-bearing liabilities:
interest-bearing liabilities - liquid assets
Operating profit excluding non-recurring items:
operating profit +/- non-recurring items
Helsinki, 5 August 2013
LASSILA & TIKANOJA PLC
Board of Directors
Pekka Ojanpää
President and CEO
For additional information please contact:
Pekka Ojanpää, President and CEO, tel. +358 10 636 2810 or
Timo Leinonen, CFO, tel. +358 400 793 073.
Lassila & Tikanoja is a service company that is transforming the consumer
society into an efficient recycling society. In co-operation with our customers
we are reducing waste volumes, extending the useful lives of properties,
recovering materials and decreasing the use of raw materials and energy. We
help our customers to focus on their core business and to save the environment.
Together, we create well-being and jobs. With operations in Finland, Sweden,
Latvia and Russia, L&T employs 9,600 persons. Net sales in 2012 amounted to EUR
674.0 million. L&T is listed on NASDAQ OMX Helsinki.
Distribution:
NASDAQ OMX Helsinki
Major media
www.lassila-tikanoja.com
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