2011-10-25 12:26:51 CEST
2011-10-25 12:27:53 CEST
REGULATED INFORMATION
Ponsse Oyj - Interim report (Q1 and Q3)
CORRECTION: PONSSE'S INTERIM REPORT FOR 1 JANUARY - 30 SEPTEMBER 2011
Vieremä, Finland, 2011-10-25 12:26 CEST (GLOBE NEWSWIRE) --
Correction: PONSSE'S INTERIM REPORT FOR 1 JANUARY-30 SEPTEMBER 2011
This is a correction to the English translation of Ponsse Interim Report
published at 9:00 am on 25 October 2011. There were errors in the original
English report in comparison periods, in the percentage of the increase of
operating costs (President and CEO review), in diluted and undiluted earnings
per share for the third quarter, in the table of Financing (current loans) and
change in cash and cash equivalents (Consolidated Statement of Cash Flows) and
in equity per share (Key Figures and Ratios). Please find the full and
corrected release below.
- Net sales amounted to EUR 225.5 (Q1-Q3/2010 171.8) million.
- Q3 net sales were EUR 72.3 (Q3/2010 54.7) million.
- Operating result totalled EUR 18.6 (Q1-Q3/2010 15.3) million, equalling 8.2
(8.9) per cent of net sales. The result includes a write-down of EUR 2.6
million on external trade receivables in South America.
- Q3 operating result was EUR 8.2 (Q3/2010 5.4) million, equalling 11.4 (10.0)
per cent of net sales.
- Profit before taxes was EUR 14.1 (Q1-Q3/2010 16.7) million.
- Cash flow from business operations was positive at EUR 5.7 (14.4) million.
- Earnings per share were EUR 0.22 (0.59).
- Equity ratio was 41.1 (42.9) per cent.
- Order books stood at EUR 110.8 (77.4) million.
PRESIDENT AND CEO JUHO NUMMELA:
In the third quarter, the demand for forest machines was good despite the
increase in economic uncertainty. At the end of the period under review, the
company's order books totalled EUR 110.8 (77.4) million, which is 43.1 per cent
higher compared with the corresponding period. There were no problems with
customer financing in the past quarter.
During the third quarter, the Group's net sales grew by 32 per cent compared
with the corresponding period and stood at EUR 72.3 (54.7) million. Net sales
for the period under review amounted to EUR 225.5 (171.8) million, representing
a growth of 31.2 per cent compared with the corresponding period. The service
business continued to show growth compared with the corresponding period.
The operating result was positive in the third quarter, amounting to EUR 8.2
(5.4) million. The operating result came to 11.4 per cent of net sales in the
past quarter. Operating costs (staff costs, depreciation and amortisation and
other operating costs), excluding the impairment losses related to trade
receivables, showed a planned increase of 29.6 per cent during the period under
review. The continuing improvement of profitability is clearly showing results.
During the period under review, cash flow from business operations was positive
at EUR 5.7 (14.4) million. As business operations have grown, more capital has
been tied up in inventories. The capital is mainly tied up in raw materials and
consumables and new machines on their way to customers. The reduction in the
departure days of domestic railway transportation hampered the implementation
of deliveries and slowed down the logistics regarding new machines. In
addition, exchange rate differences in the period under review affected profit,
diminishing the cash flow.
The factory operated as planned during the period under review. The number of
machines was increased temporarily through working hours arrangements, and it
was possible to deliver machines from the factory normally. The availability of
materials was good throughout the period.
NET SALES
Consolidated net sales for the period under review amounted to EUR 225.5
(171.8) million, which was 31,2 per cent more than in the comparison period.
International business operations accounted for 67.9 (68.7) per cent of net
sales.
Net sales were regionally distributed as follows: Northern Europe 51.1 (50.6)
per cent, Central and Southern Europe 19.2 (17.3) per cent, Russia and Asia
14.6 (11.5) per cent, North and South America 15.1 (20.5) per cent and other
countries 0.0 (0.1) per cent.
PROFIT PERFORMANCE
The operating result amounted to EUR 18.6 (15.3) million. The operating result
equalled 8.2 (8.9) per cent of net sales for the period under review. An
impairment loss worth about EUR 2.6 million related to external trade
receivables in South America was recognised as an expense during the period.
Consolidated return on capital employed (ROCE) stood at 18.0 (20.9) per cent.
Staff costs for the period totalled EUR 35.9 (26.6) million, including an
expense item of EUR 1.9 million, which included, among other things, a profit
bonus paid to Group personnel. Other operating expenses stood at EUR 25.2
(18.8) million. The net total of financial income and expenses amounted to EUR
-4.3 (1.7) million. Exchange rate gains and losses with a net effect of EUR
-3.2 (2.5) million were recognised under financial items for the period. The
impact of the Adjustment Board decisions concerning the taxation of the parent
company for the period amounts to EUR -1.5 (1.5) million. Profit for the period
under review totalled EUR 7.3 (17.8) million. Diluted and undiluted earnings
per share (EPS) came to EUR 0.22 (0.59). The interest on the subordinated loan
for the period, less tax, has been taken into account in the calculation of
EPS.
STATEMENT OF FINANCIAL POSITION AND FINANCING ACTIVITIES
At the end of the period under review, the total consolidated statements of
financial position amounted to EUR 177.0 (165.5) million. Inventories stood at
EUR 88.3 (78.5) million. Trade receivables totalled EUR 32.6 (29.7) million,
while liquid assets stood at EUR 8.5 (12.1) million. Group shareholders' equity
stood at EUR 71.8 (69.9) million and parent company shareholders' equity at EUR
65.4 (55.0) million. Group shareholders' equity includes a hybrid loan of EUR
19 million issued on 31 March 2009. The interest paid on the hybrid loan (EUR
5.7 million) and the allocated interest for the following year according to the
dividend distribution decision (EUR 1.1 million), totalling EUR 6.8 million,
less tax, are recognised as a deduction from Group equity. The amount of
interest-bearing liabilities was EUR 45.9 (49.9) million. The company has used
21 per cent of its credit facility limit. The parent company's net receivables
from other Group companies stood at EUR 72.0 (66.7) million. The parent
company's receivables from subsidiaries mainly consisted of trade receivables.
Consolidated net liabilities totalled EUR 35.1 (35.2) million, and the
debt-equity ratio (gearing) was 63.8 (71.5) per cent. The equity ratio stood at
41.1 (42.9) percent at the end of the period under review.
Cash flow from business operations amounted to EUR 5.7 (14.4) million. Cash
flow from investment activities came to EUR -5.5 (-2.4) million.
ORDER INTAKE AND ORDER BOOKS
Order intake for the period totalled EUR 269.8 (229.7) million, while
period-end order books were valued at EUR 110.8 (77.4) million. The minimum
order commitments for retailers are not included in the order book total.
DISTRIBUTION NETWORK
No changes took place in the Group structure during the period under review.
The subsidiaries included in the Ponsse Group are: Epec Oy, Finland; OOO
Ponsse, Russia; Ponsse AB, Sweden; Ponsse AS, Norway; Ponsse Asia-Pacific Ltd,
Hong Kong; Ponsse China Ltd, China; Ponsse Latin America Ltda, Brazil; Ponsse
North America, Inc., the United States; Ponssé S.A.S., France; Ponsse UK Ltd,
the United Kingdom; and Ponsse Uruguay S.A., Uruguay. Sunit Oy, based in
Kajaani, Finland, is an affiliated company in which Ponsse Oyj has a holding of
34 per cent.
CAPITAL EXPENDITURE AND R&D
During the period under review, the Group's R&D expenses totalled EUR 6.3 (4.1)
million, of which EUR 1.8 (1.1) million was capitalised.
Capital expenditure totalled EUR 5.5 (2.4) million. It mainly consisted of
ordinary maintenance and replacement investments for machinery and equipment.
MANAGEMENT
Sigurd Skotte (48), Master of Forestry, took up his post as the President and
CEO of Ponsse AS on 1 September 2011. A separate release was issued on the
appointment on 31 May 2011.
Clément Puybaret (30), forest engineer, took up his post as the President and
CEO of Ponssé S.A.S. on 15 August 2011. A separate release was issued on the
appointment on 14 June 2011.
PERSONNEL
The Group had an average staff of 936 (813) during the period and employed 970
(846) people at period-end.
SHARE PERFORMANCE
The company's registered share capital consists of 28,000,000 shares. The
trading volume of Ponsse Plc shares for 1 January - 30 September 2011 totalled
1,924,361, accounting for 6.9 per cent of the total number of shares. Share
turnover amounted to EUR 19.4 million, with the period's lowest and highest
share prices amounting to EUR 5.85 and EUR 11.85, respectively.
At the end of the period, shares closed at EUR 7.15, and market capitalisation
totalled EUR 200.2 million.
At the end of the period under review, the company held 212,900 treasury shares.
ANNUAL GENERAL MEETING
A separate release was issued on 12 April 2011 regarding the authorisations
given to the Board of Directors and other resolutions at the AGM.
GOVERNANCE
In its decision-making and administration, the company observes the Finnish
Limited Liability Companies Act, other regulations governing publicly listed
companies and the company's Articles of Association. The company's Board of
Directors has adopted the Code of Governance that complies with the Finnish
Corporate Governance Code approved by the Board of the Securities Market
Association in 2010. The purpose of the code is to ensure that the company is
professionally managed and that its business principles and practices are of a
high ethical and professional standard.
The Code of Governance is available on Ponsse's website in the Investors
section.
RISK MANAGEMENT
Risk management is based on the company's values, as well as strategic and
financial objectives. Risk management aims to support the achievement of the
objectives specified in the company's strategy, as well as to ensure the
financial development of the company and the continuity of its business.
Furthermore, risk management aims to identify, assess and monitor
business-related risks which may influence the achievement of the company's
strategic and financial goals or the continuity of its business. Decisions on
the necessary measures to anticipate risks and react to observed risks are made
on the basis of this information.
Risk management is a part of regular daily business, and it is also included in
the management system. Risk management is controlled by the risk management
policy approved by the Board.
A risk is any event that may prevent the company from reaching its objectives
or that threatens the continuity of business. On the other hand, a risk may
also be a positive event, in which case the risk is treated as an opportunity.
Each risk is assessed on the basis of its impact and probability. Methods of
risk management include avoiding, mitigating and transferring risks. Risks can
also be managed by controlling and minimising their impact.
SHORT-TERM RISK MANAGEMENT
The rapid escalation of the problems in the economies of Europe and the United
States in the financial market may have an impact on the availability of
customer financing.
The parent company monitors the changes in the Group's internal and external
trade receivables and the associated risk of impairment.
The key objective of the company's financial risk management policy is to
manage liquidity, interest and currency risks. The company ensures its
liquidity through credit limit facilities agreed with a number of financial
institutions. The effect of adverse changes in interest rates is minimised by
utilising credit linked to different reference rates and by concluding interest
rate swaps. The negative effects of currency rate fluctuations are mitigated
though derivative contracts.
Changes taking place in the fiscal and customs legislation in countries to
which Ponsse exports may hamper the company's export trade or its
profitability.
OUTLOOK FOR THE FUTURE
Strong order books mean there will be positive development of the company's
business operations towards the end of 2011. The culmination of economic
problems may have a rapid impact on the sales of new machines through problems
in customer financing. The weakening of the economy may slow down the making of
investment decisions on forest machines.
The profitability of the Group's business operations during the entire year is
expected to develop positively and improve compared to 2010. Cash flow from
business operations will amount to the same level as in 2010.
The factory and maintenance are operating at full capacity. The development of
operating expenses will be monitored in an enhanced manner, and the investments
for the end of the year will be implemented as planned.
PONSSE GROUP
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (EUR 1,000)
IFRS IFRS IFRS
1-9/11 1-9/10 1-12/10
NET SALES 225,484 171,819 262,416
Increase (+)/decrease (-) in inventories of 9,918 6,561 476
finished goods and work in progress
Other operating income 812 678 898
Raw materials and services -152,738 -114,572 -170,810
Expenditure on employment-related benefits -35,870 -26,638 -38,243
Depreciation and amortisation -3,799 -3,806 -5,079
Other operating expenses -25,206 -18,790 -27,984
OPERATING RESULT 18,600 15,252 21,674
Share of results of associated companies -185 -232 5
Financial income and expenses -4,273 1,717 2,769
RESULT BEFORE TAXES 14,142 16,738 24,448
Income taxes -6,860 1,052 -1,111
NET RESULT FOR THE PERIOD 7,282 17,790 23,338
OTHER ITEMS INCLUDED IN TOTAL COMPREHENSIVE
RESULT:
Translation differences related to foreign units -157 -654 -904
TOTAL COMPREHENSIVE RESULT FOR THE PERIOD 7,125 17,136 22,434
Diluted and undiluted earnings per share (* 0.22 0.59 0.78
IFRS IFRS
7-9/11 7-9/10
NET SALES 72,278 54,705
Increase (+)/decrease (-) in inventories of 2,975 2,198
finished goods and work in progress
Other operating income 375 176
Raw materials and services -48,842 -35 530
Expenditure on employment-related benefits -10,499 -8,328
Depreciation and amortisation -1,246 -1,277
Other operating expenses -6,818 -6,500
OPERATING RESULT 8,222 5,443
Share of results of associated companies -42 -131
Financial income and expenses -1,003 -3,443
RESULT BEFORE TAXES 7,177 1,870
Income taxes -2,526 -610
NET RESULT FOR THE PERIOD 4,651 1,260
OTHER ITEMS INCLUDED IN TOTAL COMPREHENSIVE
RESULT:
Translation differences related to foreign units -493 687
TOTAL COMPREHENSIVE RESULT FOR THE PERIOD 4,158 1,947
Diluted and undiluted earnings per share (* 0.15 0.03
(* The interest on the subordinated loan for the period, less tax, was taken
into account in this figure.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION (EUR 1,000)
IFRS IFRS
ASSETS 30.9.11 31.12.10
NON-CURRENT ASSETS
Intangible assets 8,138 6,571
Goodwill 3,440 3,440
Property, plant and equipment 24,596 24,443
Financial assets 111 111
Investments in associated companies 1,290 1,625
Non-current receivables 1,724 3,144
Deferred tax assets 2,759 1,712
TOTAL NON-CURRENT ASSETS 42,059 41,045
CURRENT ASSETS
Inventories 88,297 72,391
Trade receivables 32,333 32,125
Income tax receivables 655 623
Other current receivables 5,178 4,483
Cash and cash equivalents 8,492 11,036
TOTAL CURRENT ASSETS 134,955 120,659
TOTAL ASSETS 177,015 161,704
SHAREHOLDERS' EQUITY AND LIABILITIES
SHAREHOLDERS' EQUITY
Share capital 7,000 7,000
Other reserves 19,030 19,030
Translation differences -1,189 -1,032
Treasury shares -2,228 -2,228
Retained earnings 49,226 52,396
EQUITY OWNED
BY PARENT COMPANY SHAREHOLDERS 71,839 75,166
NON-CURRENT LIABILITIES
Interest-bearing liabilities 28,557 16,155
Deferred tax liabilities 153 469
Other non-current liabilities 27 128
TOTAL NON-CURRENT LIABILITIES 28,737 16,752
CURRENT LIABILITIES
Interest-bearing liabilities 17,308 20,603
Provisions 4,842 4,706
Tax liabilities for the period 2,251 215
Trade creditors and other current liabilities 52,038 44,263
TOTAL CURRENT LIABILITIES 76,438 69,787
TOTAL SHAREHOLDERS' EQUITY AND LIABILITIES 177,015 161,704
CONSOLIDATED STATEMENT OF CASH FLOWS (EUR 1,000)
IFRS IFRS
1-9/11 1-9/10
CASH FLOW FROM BUSINESS OPERATIONS:
Net result for the period 7,282 18,010
Adjustments:
Financial income and expenses 4,273 -1,717
Share of the result of associated companies 185 232
Depreciation and amortisation 3,799 3,806
Income taxes 7,298 -589
Other adjustments -47 4
Cash flow before changes in working capital 22 791 19,746
Change in working capital:
Change in trade receivables and other receivables 289 -8,122
Change in inventories -15,906 -11,519
Change in trade creditors and other liabilities 7,885 13,263
Change in provisions for liabilities and charges 136 -835
Interest received 134 373
Interest paid -853 -805
Other financial items -3,434 2,342
Income taxes paid -5,294 -31
NET CASH FLOW FROM BUSINESS OPERATIONS (A) 5,747 14,411
CASH FLOW FROM INVESTMENTS
Investments in tangible and intangible assets -5,521 -2,437
Investments in other assets 0 0
Repayment of loan receivables 0 0
Dividends received 0 0
CASH OUTFLOW FROM INVESTMENT ACTIVITIES (B) -5,521 -2,437
FINANCING
Acquisition of treasury shares 0 -1,564
Hybrid loan 0 0
Interest paid, hybrid loan -2,280 -2,280
Withdrawal/Repayment of current loans -463 -1,940
Change in current interest-bearing liabilities 78 73
Withdrawal/Repayment of non-current loans 9,873 96
Payment of finance lease liabilities -403 -505
Change in non-current receivables 150 -140
Dividends paid -9,725 -4,193
NET CASH OUTFLOW FROM FINANCING (C) -2,771 -10,454
Change in cash and cash equivalents (A+B+C) -2,545 1,521
Cash and cash equivalents on 1 January 11,036 10,626
Cash and cash equivalents on 30 September 8,492 12,147
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (EUR 1,000)
A = Share capital
B = Share premium and other reserves
C = Translation differences
D = Treasury shares
E = Retained earnings
F = Total shareholders' equity
EQUITY OWNED BY PARENT COMPANY SHAREHOLDERS
A B C D E F
SHAREHOLDERS' EQUITY 1 JAN 2011 7,000 19,030 -1,032 -2,228 52,396 75,166
Adjustment for previous periods 960 960
regarding the hybrid loan
interest
Adjusted shareholders' equity 1 7,000 19,030 -1,032 -2,228 53,356 76,126
Jan 2011
Translation differences -157 -157
Result for the period 7,282 7,282
Total comprehensive income for -157 7,282 7,125
the period
Direct entries to retained -1,687 -1,687
earnings *)
Dividend distribution -9,725 -9,725
Purchase of treasury shares 0
Other changes 0
SHAREHOLDERS' EQUITY 30 SEP 2010 7,000 19,030 -1,189 -2,228 49,226 71,839
SHAREHOLDERS' EQUITY 1 JAN 2010 7,000 19,030 -128 -665 34,329 59,566
Translation differences -654 -654
Result for the period 17,790 17,790
Total comprehensive income for -654 17,790 17,136
the period
Direct entries to retained -1,078 -1,078
earnings *)
Dividend distribution -4,193 -4,193
Purchase of treasury shares -1,563 -1,563
Other changes 0
SHAREHOLDERS' EQUITY 30 SEP 2010 7,000 19,030 -782 -2,228 46,848 69,868
*) Consists of the interest paid for the hybrid loan classified as equity.
30.9.11 30.9.10 31.12.10
1. LEASING COMMITMENTS (EUR 1,000) 4,323 5,224 4,991
2. CONTINGENT LIABILITIES (EUR 1,000) 30.9.11 30.9.10 31.12.10
Guarantees given on behalf of others 857 684 425
Repurchase commitments 1,841 3,280 2,501
Other commitments 4,249 1,964 2,659
TOTAL 6,947 5,928 5,585
3. PROVISIONS (EUR 1,000) Guarantee provision
1 January 2011 4,706
Provisions added 770
Provisions cancelled -635
30 September 2011 4,842
KEY FIGURES AND RATIOS 30.9.11 30.9.10 31.12.10
R&D expenditure, MEUR 6.3 4.1 5.9
Capital expenditure, MEUR 5.5 2.4 4.8
as % of net sales 2.4 1.4 1.8
Average number of employees 936 813 825
Order books, MEUR 110.8 77.4 68.3
Equity ratio, % 41.1 42.9 46.9
Diluted and undiluted earnings per share (EUR) 0.22 0.59 0.78
Equity per share (EUR) 2.57 2.50 2.68
FORMULAE FOR FINANCIAL INDICATORS
Average number of employees:
Average of the number of personnel at the end of each month. The calculation
has been adjusted for part-time employees.
Equity ratio, %:
Shareholders' equity + Non-controlling interests
---------------------------------------------
Balance sheet total - advance payments received * 100
Earnings per share:
Net income for the period - Non-controlling interests - Interest on hybrid loan
for the period less tax
----------------------------------------------
Average number of shares during the accounting period, adjusted for share issues
Equity per share:
Shareholders' equity
----------------------------------------------
Number of shares on the balance sheet date, adjusted for share issues
ORDER INTAKE, MEUR 1-9/11 1-9/10 1-12/10
Ponsse Group 269.8 229.7 311.2
The interim report has been prepared observing the recognition and valuation
principles of IFRS standards, but not all of the requirements of IAS 34,
Interim Financial Reporting, have been complied with. The same accounting
principles were observed for the interim report as for the annual financial
statements dated 31 December 2010, with the exception, however, that the
following new standards, interpretations and amendments adopted by the EU were
introduced from 1 January 2011: IAS 24 (revised) - Related Party Disclosures;
IAS 32 (amendment) - Classification of Rights Issue; IFRIC 19 - Extinguishing
Financial Liabilities with Equity Instruments; and IFRIC 14 (amendment) -
Prepayments of a Minimum Funding Requirement.
These new standards, interpretations and amendments have no impact on the
Group's interim report.
In July 2010, the IASB published improvements to seven standards or
interpretations as part of its annual improvements. The Group will adopt the
amendments, after EU approval, in its financial statements for 2011: IFRS 3
(amendment) - Business Combinations; IFRS 7 (amendment) - Financial
Instruments: Disclosures; IAS 1 (amendment) - Presentation of Financial
Statements; IAS 27 (amendment) - Consolidated and Separate Financial
Statements; IAS 34 (amendment) - Interim Financial Reporting; IFRIC 13:
Customer Loyalty Programmes; IFRS 9 - Classification and measurement of
financial assets and liabilities; IAS 12 (amendment) - Deferred taxes; these
improvements may have an impact on the consolidated interim reports.
The above figures have not been audited.
The above figures have been rounded and may therefore differ from those given
in the official financial statements.
This communication includes future-oriented statements that are based on the
assumptions currently made by the company's management and its current
decisions and plans. Although the management believes that the future
expectations are well founded, there is no certainty that these expectations
will prove to be correct. This is why the results may significantly deviate
from the assumptions included in the future-oriented statements as a result of,
among other things, changes in the economy, markets, competitive conditions,
legislation or currency exchange rates.
Vieremä, 25 October 2011
PONSSE PLC
Juho Nummela
President and CEO
FURTHER INFORMATION
Juho Nummela, President and CEO, tel. +358 20 768 8914 or +358 400 495 690
Petri Härkönen, CFO, tel. +358 20 768 8608 or +358 50 409 8362
DISTRIBUTION
NASDAQ OMX Helsinki Ltd
Principal media
www.ponsse.com
Ponsse Plc is a company specialising in the sales, manufacture, servicing and
technology of cut-to-length method forest machines and is driven by genuine
interest in its customers and their business. Ponsse develops and manufactures
sustainable and innovative harvesting solutions based on customers' needs.
The company was established by forest machine entrepreneur Einari Vidgrén in
1970, and it has been a leader in timber harvesting solutions based on the
cut-to-length method ever since. Ponsse is headquartered in Vieremä, Finland.
The company's shares are quoted on the NASDAQ OMX Nordic List.
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