2007-02-27 15:25:31 CET
2007-02-27 15:25:31 CET
REGULATED INFORMATION
Evox Rifa Group - Financial Statement Release
EVOX RIFA GROUP FINANCIAL PERFORMANCE JANUARY 1 – DECEMBER 31, 2006
· Net sales of 2006 were EUR 89.8 million (EUR 79.9 million in
2005). Net sales increased by 12 percent compared to the previous
year.
· Operating profit was 1.9 million (loss EUR 7.5 million).
Operating profit includes EUR 1.2 million of one-time gain from real
estate sales and EUR 0.9 million of one-time restructuring costs. In
2005 one-time costs were EUR 5.4 million.
· Loss before taxes was EUR 0.2 million (loss EUR 8.7 million)
· Earnings per share were EUR –0.005 (EUR –0.052)
· Order backlog on December 31, 2006 was EUR 23.2 million (EUR 17.7
million)
· The Board of Directors proposes that no dividend be distributed
for the fiscal period.
ECONOMIC DEVELOPMENT IN 2006
Net Sales
Net sales of the Group totalled EUR 89.8 million (EUR 79.9 million in
2005).
During the 2006, demand was at a good level in all Evox Rifa’s market
areas. Europe was still the main market area of the Group, and the
market share there remained at the level of the previous year. Evox
Rifa’s major customers continued expanding their activities in China,
but globally Europe kept its position as the major location for
manufacturing of industrial and automotive electronics. The North
American market was steadily recovering during 2006.
The share of the Group’s sales to the industrial electronics increased
compared to the previous year and it was now 68 percent (59 percent in
2005). Deliveries to the end customers were carried out through
contract manufacturers more often than earlier.
Profit
Operating profit of the Group in 2006 was EUR 1.9 million (loss EUR 7.5
million) and loss before taxes was EUR 0.2 million (loss EUR 8.7
million). The operating loss includes EUR 1.2 million of one-time gains
from the sale of production facilities in Sweden and UK and EUR 0.9
million of one-time costs which resulted from the relocation and
restructuring activities in the US and Europe. The one-time costs in
2005 were EUR 5.4 million.
Earnings per share were EUR –0,005 (EUR –0.052) and shareholders’
equity per share was EUR 0.036 (EUR 0.041).
Evox Rifa Group has received product reclamations the processing of
which is still in process. The management believes that the provisions
made in the balance sheet of the Group will cover currently assessable
compensation risk.
Order backlog
The order backlog of the Group was EUR 23.2 million at the end of 2006
(EUR 17.7 million at the end of 2005). The order backlog remained on a
good level in the last quarter of 2006 and it is expected to remain
such in the first quarter of 2007.
FINANCIAL STATUS AND CAPITAL EXPENDITURE
Liquid assets of the Group were EUR 1.3 million (EUR 2.4 million) and
the equity ratio was 12.9 % (13.9%) at the end of 2006. If the
convertible capital loan was included in the shareholders’ equity,
equity ratio was 23.3 %.
The Group’s net interest costs were EUR 1.4 million (EUR 1.4 million).
Exchange rate gains and losses totalled EUR -0.5 million (+0.4).
Even though the operative cash flow improved towards the end of the
year, the Group’s financial position continued to be tight. The
expansion of production at the Finnish plant, the restructuring of the
Swedish operations, the low profitability of the Finnish plant and the
increased need for working capital reduced the Group’s liquidity.
In June 2006 the Group agreed with its main financiers on the
conditions of a EUR 2.2 million working capital financing, and in
December on a EUR 3.3 million investment and working capital financing.
The Group’s financing agreements include standard terms regarding the
change of ownership.
The real estate deal in Sweden was closed in March 2006. BHC Components
Ltd. reached an agreement on the sales conditions of its production
facility in June, and it will continue as a lessee in the premises.
Total revenues from the real estate sales were EUR 6.0 million.
Evox Rifa Group Oyj issued a convertible capital loan in March 2005,
which was subscribed by EUR 5.6 million. No interest can be paid on the
convertible loan in 2006 due to lack of distributable profits in the
financial statements of December 31, 2006. Interest on the convertible
capital loan, EUR 0.3 million, however, reduces the result of 2006.
Gross investments into manufacturing equipment at the Group’s Finnish,
British, Chinese and Indonesian plants were EUR 1.0 million (EUR 4.0
million).
SHARES AND SHARE CAPITAL
The nominal value of the shares of Evox Rifa Group Oyj is EUR 0.05, the
number of shares was 178.156.018 on December 31, 2006 and the share
capital was EUR 8.908.400,90. Due to subscriptions of 935.000 new
shares by share options, the share capital increased by 47.350 euros.
PERSONNEL
The average number of personnel of Evox Rifa Group was 1391 in 2006
(1320 in 2005).
The number of personnel increased at the plants in Asia and Finland. At
the end of 2006, 54 % (54%) of the Group personnel were employed in
Asia. At the Finnish plant there were 26 persons, whose temporary
employment contracts were not renewed.
THE BOARD’S PROPOSAL FOR DIVIDEND DISTRIBUTION
The Board of Directors propose to the Annual Shareholders’ Meeting that
no dividend be distributed for the fiscal period.
BUSINESS DEVELOPMENT
Net sales of the electrolytic capacitors product group were EUR 48.3
million in 2006 (EUR 40.8 million in 2005). The profitability of the
product group continued on a favourable level and demand was strong in
all market areas.
The Nantong plant in China started producing screw terminal
electrolytic capacitors at the end of 2005. During 2006, the plant’s
profitability improved and stabilised its position as a component
supplier to industrial electronics.
Net sales of the film capacitor product group were EUR 41.5 million
(EUR 39.1 million in 2005). Demand was strong in all market areas, and
capacity utilization rates of the plants were on a good level. The high
prices of energy and raw materials caused pressure on gross margins.
The Kalmar plant in Sweden was closed at the end of 2005, and the main
part of its production was transferred to Finland. The start up of
paper capacitor production in Finland was more difficult than expected.
This caused substantial losses especially during the first quarter of
the year.
SIGNIFICANT EVENTS AFTER DECEMBER 31, 2006
On February 19, 2007 Kemet Corporation announced its intention to
launch a public offer to acquire all the shares of Evox Rifa Group
Oyj.
OUTLOOK FOR THE YEAR 2007
The year 2006 was a period of strong demand, and stable demand is
expected to continue, especially in the industrial and automotive
electronic sectors. However, the visibility of the market demand and
market conditions is weakened by increased inventory levels in the
supply chain and high prices of raw materials and energy.
The sales development of Evox Rifa Group’s most important customers is
expected to continue at a steady pace, and the growth of the business
operations in Asia of the major partners of the Group is expected to
continue.
The increased need for working capital and the low profitability of the
Finnish plant have tied up Group’s liquid funds. As the capacity
utilization rates of the plants are expected to stay at a good level
and the Chinese plant is expected to tie up more working capital, the
financial situation of the Group will still be tight.
The profitability of the electrolytic capacitors product group is
estimated to stay good. The film and paper capacitors product group is
expected to improve its performance along with the improving
profitability of the Finnish plant.
SEGMENT REPORTING
Capacitors Other Total
Q4/06 Q4/05 Q4/06 Q4/05 Q4/06 Q4/05
Net sales 22 623 20 190 - - 22 623 20 190
Operating 1 182 -2 793 -162 -85 1 020 -2 878
result
Capacitors Other Total
Q1-Q4/06 Q1-Q4/05 Q1-Q4/06 Q1-Q4/05 Q1-Q4/06 Q1-Q4/05
Net sales 89 787 79 911 - - 89 787 79 911
Operating 1 875 -7 340 -10 -179 1 865 -7 519
result
INCOME STATEMENT OF EVOX RIFA GROUP
1.10.- 1.10.- 1.1.- 1.1.-
31.12.06 31.12.05 31.12.06 31.12.05
1000 EUR 1000 EUR 1000 EUR 1000 EUR
NET SALES 22 623 20 190 89 787 79 911
Operating expenses -20 927 -22 222 -85 220 -84 117
Depreciations and
write-downs -676 -846 -2 702 -3 313
OPERATING PROFIT
(LOSS) 1 020 -2 878 1 865 -7 519
Financial income
and expenses -495 -233 -2 090 -1 198
PROFIT (LOSS)
BEFORE TAXES 525 -3 111 -225 -8 717
DIRECT TAXES -80 -171 -716 -539
NET PROFIT (LOSS)
FOR THE PERIOD 445 -3 282 -941 -9 256
Attributable to:
Shareholders of
parent company 437 -3 250 -948 -9 172
Minority
interest 8 -32 7 -84
445 -3 282 -941 -9 256
Earnings per share
(EUR) 0,002 -0,018 -0,005 -0,052
Earnings per share
(EUR), dilluted 0,002 -0,018 -0,005 -0,052
BALANCE SHEET OF EVOX RIFA GROUP
31.12.06 31.12.05
ASSETS 1000 EUR 1000 EUR
FIXED ASSETS AND OTHER NON-
CURRENT ASSETS
Tangible assets 12 821 15 855
Intangible assets 1 266 1 264
Investments,non-current 285 374
INVENTORIES AND CURRENT
ASSETS
Inventories 16 615 15 012
Short-term receivables 17 109 14 441
Cash and bank
receivables 1 313 2 435
Assets held for sale 0 3 798
TOTAL NON-CURRENT AND
CURRENT ASSETS 49 409 53 179
LIABILITIES AND
SHAREHOLDERS’ EQUITY
Share capital 8 909 8 861
Other restricted equity 2 611 2 603
Non-restricted equity -5 276 -4 220
MINORITY INTEREST 133 142
TOTAL SHAREHOLDERS’ EQUITY
6 377 7 386
LIABILITIES
Deferred tax liability 515 730
Convertible capital loan 5 125 5 004
Pension liabilities 1 904 2 321
Other long-term liabilities 7 557 9 623
Short-term liabilities 27 931 28 115
TOTAL LIABILITIES AND
SHAREHOLDERS’ EQUITY 49 409 53 179
STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY 1.1. – 31.12.2006
Share Other Transl. Retained Minority Total
capital reserves differ. earnings interest
Shareholders’
equity on
31.12.2005 8 861 2 603 -1 481 -2 739 142 7 386
Movements
Used share
options 48 8 56
Translation
difference -108 -16 -124
Net profit
/loss -948 9 -941
Shareholders’
equity on
31.12.2006 8 909 2 611 -1 589 -3 687 133 6 377
STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY 1.1. – 31.12.2005
Share Other Transl. Retained Minority Total
capital reserves difference earnings interest
Shareholders’
equity on
31.12.2004 8 669 14 722 -2 509 -6 374 685 15 193
Movements
Share issue 192 193 385
Transfer of
reserve
funds -12 312 12 312 0
Translation
difference 1 028 45 1 073
Equity part
of
convertible 495 495
capit. loan
Net profit
/loss -9 172 -84 -9 256
Purchase of
minority -504 -504
interest
Shareholders’
equity on
31.12.2005 8 861 2 603 -1 481 -2 739 142 7 386
EVOX RIFA GROUP CASH FLOW STATEMENT
1.1.- 1.1.-
31.12.06 31.12.05
1000 EUR 1000 EUR
Net cash from operating activities -1 765 -1 514
Purchases of tangible assets*) -738 -3 679
Purchases of intangible assets -16 -287
Proceeds from sale of tangible and
intangible assets 5 952 99
Net cash from investing activities 5 198 -3 867
CASH FLOW FROM INVESTING ACTIVITIES
Convertible capital loan 0 5 588
Net bank loans raised 658 2 665
Repayment of loans -5 169 -3 072
Payments of finance lease liabilities -141 -234
Payments received from share issue 56 0
Net cash used in (-) / prodvided by (+)
financing activities -4 595 4 947
Increase(+)/decrease(-) in cash and
cash equivalents -1 163 -434
Cash and cash equivalents on January 1 -3 883 -3 618
Effect of exchange rate fluctuations on
cash held 137 -169
Cash and cash equivalents on Dec. 31 -5 183 -3 883
Net change in cash and cash equivalents -1 163 -434
Cash and cash equivalent:
Cash on hand and in banks 1 313 2 435
Bank overdrafts -6 496 -6 318
Total -5 183 -3 883
*) an investment grant of 260 TEUR is not included
The figures in the Group cash flow statement cannot be directly traced
from the balance sheet due to translation differences and elimination
of non-cash items.
EVOX RIFA GROUP KEY FIGURES
31.12.06 31.12.05
Return on equity %, ROE -13,7 % -82,0 %
Return on investment %, ROI 5,6 % -18,7 %
Equity ratio % 12,9 % 13,9 %
Equity ratio %*) 23,3 % 23,3 %
Gross investments in
fixed assets, TEUR 1 021 3 966
% of net sales 1,1 % 5,0 %
Earnings per share (EUR) -0,005 -0,052
Equity per share (EUR) 0,036 0,042
Order backlog, (MEUR) 23,2 17,7
Personnel, average 1 391 1 320
*) The convertible capital loan is included in the shareholders’
equity.
LIABILITIES
Debts secured with mortgages and pledges on December 31, 2006 (1000
EUR):
Real estate mortgages 1 106
Mortgages on company assets 14 181
Pledged shares 9 590
Total 24 877
Other pledges on behalf of Group companies:
Other pledges 292
Pledged shares 35
Total 327
DERIVATIVE CONTRACTS
The company uses currency options to hedge foreign currency denominated
balance sheet items against exchange rate fluctuations. The maturity of
the currency options vary from 1 to 3 months.
The nominal values of derivative contracts made to hedge the exchange
rates fluctuations on December 31, 2006 (1000 EUR):
Currency options
Bought options 2 035
The figures of this Financial Report are unaudited.
In Espoo on February 27, 2007
EVOX RIFA GROUP OYJ
Tuula Ylhäinen
President & CEO
For further information please contact: Evox Rifa Group Oyj, Tuula
Ylhäinen, President & CEO, tel.+358 9 5406 5001
DISTRIBUTION
Helsinki Stock Exchange, Main Media
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