2013-08-01 10:00:00 CEST
2013-08-01 10:00:06 CEST
REGLERAD INFORMATION
Affecto Oyj - Interim report (Q1 and Q3)
Affecto Plc's Interim report 1-6/2013
Helsinki, 2013-08-01 10:00 CEST (GLOBE NEWSWIRE) -- AFFECTO PLC -- INTERIM
REPORT -- 1 AUGUST 2013 at 11.00
Affecto Plc's Interim report 1-6/2013
Group key figures
MEUR 4-6/13 4-6/12 1-6/13 1-6/12 2012 Last 12m
Net sales 34.8 33.1 69.2 66.7 133.4 135.9
Operational segment result 2.5 3.2 5.0 5.8 12.5 11.8
% of net sales 7.1 9.7 7.3 8.6 9.4 8.7
Operating profit 2.0 2.7 4.0 4.7 10.5 9.7
% of net sales 5.7 8.2 5.8 7.1 7.8 7.2
Profit before taxes 1.8 2.6 3.9 4.5 10.0 9.5
Profit for the period 1.2 2.0 2.7 3.5 7.6 6.8
Equity ratio, % 53.5 50.1 53.5 50.1 50.6 -
Net gearing, % 21.1 31.6 21.1 31.6 15.8 -
Earnings per share, eur 0.05 0.09 0.13 0.17 0.37 0.33
Earnings per share (diluted), 0.05 0.09 0.13 0.16 0.36 0.33
eur
Equity per share, eur 3.10 3.00 3.10 3.00 3.24 -
CEO Pekka Eloholma comments:
We continued to grow in the second quarter. Net sales grew by 5% to 34.8 MEUR
(33.1 MEUR). Denmark grew by 17% and Norway by 15%, and also Sweden and Finland
achieved growth. Net sales in Baltic decreased by 3% as the local market slowed
down especially in Lithuania.
Operating profit was 2.0 MEUR (2.7 MEUR) and profitability decreased to 6%
(8%). Profit improved in Denmark and Norway. Profit decreased in Finland, but
was still on a good level. Profitability in Baltic decreased clearly and Sweden
continued at loss.
Order backlog decreased to 48.8 MEUR (53.8 MEUR), as customers slowed down
their decision making and made investment decisions in smaller lots than
earlier. The development of the order backlog in the second quarter, especially
in June, was a disappointment for us and reflects the weakened general economic
outlook.
We have decreased our operating profit growth estimate due to the general
economic development, our performance in the first half of 2013 and the
development of our order backlog.
Net sales are estimated to grow in 2013. Operating profit is estimated to be
near last year's level.
Earlier guidance was: Operating profit and net sales are estimated to grow in
2013.
Additional information:
CEO Pekka Eloholma, +358 205 777 737
CFO Satu Kankare, +358 205 777 202
SVP, M&A, IR, Hannu Nyman, +358 205 777 761
This release is unaudited. The amounts in this report have been rounded from
exact numbers.
NET SALES
Affecto's net sales in 1-6/2013 were 69.2 MEUR (1-6/2012: 66.7 MEUR). Net sales
in Finland were 27.0 MEUR (27.2 MEUR), in Norway 16.1 MEUR (13.3 MEUR), in
Sweden 12.3 MEUR (12.3 MEUR), in Denmark 8.1 MEUR (7.3 MEUR) and 8.2 MEUR (7.8
MEUR) in Baltic.
Net sales by reportable segments
Net sales, MEUR 4-6/13 4-6/12 1-6/13 1-6/12 2012 Last 12m
Finland 14.3 13.7 27.0 27.2 52.6 52.4
Norway 7.6 6.6 16.1 13.3 27.2 30.0
Sweden 6.2 5.8 12.3 12.3 24.0 23.9
Denmark 4.3 3.6 8.1 7.3 16.0 16.8
Baltic 3.9 4.0 8.2 7.8 16.7 17.0
Other -1.4 -0.6 -2.4 -1.3 -3.0 -4.2
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Group total 34.8 33.1 69.2 66.7 133.4 135.9
Net sales grew by 5% in the second quarter. Denmark grew by 17% and Norway by
15%, and also Sweden and Finland achieved growth. Net sales in Baltic decreased
by 3% as the local market slowed down especially in Lithuania. Customers'
interest was toward shorter and smaller projects than earlier and the
investment decisions take a long time. Sales of the third-party licenses, sold
with the solutions, somewhat exceeded last year's level.
Net sales of Information Management Solutions business in 1-6/2013 were 64.7
MEUR (61.2 MEUR) and net sales of Karttakeskus GIS business were 5.7 MEUR (6.1
MEUR).
After rather brisk April and May, the sales performance in June was muted and
as a consequence the order backlog decreased to 48.8 MEUR, below last year
(53.8 MEUR). Normally June is a good sales month and the order backlog grows,
but this year the customers apparently postponed decisions over the summer.
PROFIT
Affecto's operating profit in 1-6/2013 was 4.0 MEUR (4.7 MEUR) and the
operational segment result was 5.0 MEUR (5.8 MEUR). Operational segment result
was in Finland 3.2 MEUR (4.0 MEUR), in Norway 1.7 MEUR (1.3 MEUR), in Sweden
-0.3 MEUR (-0.3 MEUR), in Denmark 0.8 MEUR (0.5 MEUR) and in Baltic 0.4 MEUR
(0.9 MEUR).
Operating profit in the second quarter decreased to 6% of net sales (8%).
Profitability improved in Denmark, was stable in Norway, but decreased
elsewhere. The largest negative impact came from Baltic and Finland. On average
the quarter had one more available workday than last year.
In Baltic especially the Lithuanian market slowed down and a four-day work week
has been partially adopted there. Finland made a good 12% result, but did not
achieve last year's level. Other business areas performed well, but the profit
of the Karttakeskus GIS business decreased clearly.
Operational segment result by reportable segments
Operational segment 4-6/13 4-6/12 1-6/13 1-6/12 2012 Last 12m
result, MEUR
Finland 1.7 2.1 3.2 4.0 7.7 6.9
Norway 0.8 0.7 1.7 1.3 3.3 3.7
Sweden -0.2 -0.1 -0.3 -0.3 -0.9 -1.0
Denmark 0.5 0.3 0.8 0.5 1.8 2.1
Baltic 0.1 0.5 0.4 0.9 2.0 1.5
Other -0.4 -0.2 -0.7 -0.6 -1.4 -1.4
--------------------------------------------------------------------------
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Operational segment result 2.5 3.2 5.0 5.8 12.5 11.8
IFRS3 Amortization -0.5 -0.5 -1.0 -1.0 -2.1 -2.1
Operating profit 2.0 2.7 4.0 4.7 10.5 9.7
--------------------------------------------------------------------------
According to the IFRS3 requirements, 1-6/2013 operating profit includes 1.0
MEUR (1.0 MEUR) of amortization on intangible assets related to acquisitions.
The IFRS3 amortization is estimated to be approx. 2.0 MEUR per year until 2014,
as the other intangible assets impacting in the IFRS3 amortization totaled 2.7
MEUR at the end of the reporting period.
Taxes corresponding to the profit of the period have been entered as tax
expense. Net profit for the period was 2.7 MEUR, while it was 3.5 MEUR last
year.
FINANCE AND INVESTMENTS
At the end of the reporting period Affecto's balance sheet totaled 132.8 MEUR
(12/2012: 147.9 MEUR). Equity ratio was 53.5% (12/2012: 50.6%) and net gearing
was 21.1% (12/2012: 15.8%).
The financial loans were 28.5 MEUR (12/2012: 30.5 MEUR) at the end of reporting
period. The company's cash and liquid assets were 14.6 MEUR (12/2012: 19.8
MEUR). The interest-bearing net debt was 13.8 MEUR (12/2012: 10.6 MEUR).
Cash flow from operating activities for the reported period was 1.1 MEUR (-0.2
MEUR) and cash flow from investing activities was -1.1 MEUR (-0.7 MEUR).
Investments in tangible and intangible assets were 1.1 MEUR (0.6 MEUR).
The Annual General Meeting held in April decided to distribute a dividend of
3.4 MEUR (2.4 MEUR).
EMPLOYEES
The number of employees was 1082 persons at the end of the reporting period
(1100). 430 employees were based in Finland, 126 in Norway, 140 in Sweden, 67
in Denmark and 319 in the Baltic countries. The average number of employees
during the period was 1082 (1082).
Hellen Wohlin Lidgard started as the country manager in Sweden in April. Rene
Lykkeskov returned to his role as Affecto's chief strategy officer.
REVIEW OF MARKET DEVELOPMENTS
Uncertainty about the general economic development continued to affect
Affecto's business negatively. Customers' decision-making pace was slower than
normally, which decreased Affecto's growth. Additionally the customers are
ordering shorter projects than earlier, which has decreased the size of the
order backlog in most countries.
In general, there has been no significant negative change in the market
situation regarding our core markets. The demand for EIM solutions, including
Business Intelligence (BI) and Enterprise Content Management (ECM), is
estimated to continue growing more rapidly than the general IT services. The
analyst forecasts for the average annual growth of BI and analytics software
license markets are approx. 6-8% in the next few years. The Nordic EIM services
markets are estimated to grow annually by 6-8% on average. However, market
growth estimates for 2013 are smaller.
BUSINESS REVIEW BY AREAS
The group's business is managed through five country units. Finland, Norway,
Sweden, Denmark and Baltic are also the reportable segments.
In 4-6/2013 the net sales in Finland grew by 4% to 14.3 MEUR (13.7 MEUR).
Operational segment result was 1.7 MEUR (2.1 MEUR). Profitability was 12%. The
business development was rather stable, but customers were cautious with their
orders. Despite that, the order backlog is at last year's level.
In 4-6/2013 the net sales of Karttakeskus GIS business, reported as part of
Finland, decreased by 9% to 3.0 MEUR (3.2 MEUR) and its profitability was lower
than last year. Largest deals in the period were made with the Finnish Agency
for Rural Affairs and the Finnish Transport Authority.
In 4-6/2013 the net sales in Norway were 7.6 MEUR (6.6 MEUR) and operational
segment result was 0.8 MEUR (0.7 MEUR). Net sales grew by 15% and profitability
was 10%. Business development was mainly good, but customers prefer shorter and
smaller projects than earlier, which has decreased the order backlog.
In 4-6/2013 the net sales in Sweden were 6.2 MEUR (5.8 MEUR) and operational
segment result -0.2 MEUR (-0.1 MEUR). The net sales grew by 8%. There was still
loss and the development actions taken contributed to that. The new country
manager Hellen Wohlin Lidgard started in late April. Development actions
continue and the goal is to achieve normal profitability, but structural and
operational changes for the business will take some time. The share of
employees doing billable work is being increased. Order backlog grew during the
quarter, but is below last year's level. Largest deal in the period was the
agreement with the Länsförsäkringar Bank.
In 4-6/2013 the net sales in Denmark were 4.3 MEUR (3.6 MEUR) and operational
segment result was 0.5 MEUR (0.3 MEUR). Net sales grew by 17% and profitability
grew to 11%. Generally the business developed well. Sales performed well and
the order backlog exceeds last year's level.
In 4-6/2013 the net sales in Baltic (Lithuania, Latvia, Estonia, Poland, South
Africa) were 3.9 MEUR (4.0 MEUR). Operational segment result was 0.1 MEUR (0.5
MEUR). Net sales decreased by 3% and profitability decreased to 2%. The sales
mix of consultant work was less profitable than last year. Especially in
Lithuania the market has slowed down and public sector customers' launch new
projects very slowly. In order to improve profitability the Lithuanian
organization has partially adopted a 4-day work week.
ANNUAL GENERAL MEETING AND GOVERNANCE
The Annual General Meeting of Affecto Plc, held on 9 April 2013, adopted the
financial statements for 1.1.-31.12.2012 and discharged the members of the
Board of Directors and the CEO from liability. Approximately 35 percent of
Affecto's shares and votes were represented at the Meeting. The Annual General
Meeting decided on a dividend distribution of EUR 0.16 per share for the year
2012.
Aaro Cantell, Magdalena Persson, Jukka Ruuska, Olof Sand, Tuija Soanjärvi and
Lars Wahlström were elected as members of the Board of Directors. The
organization meeting of the Board of Directors re-elected Aaro Cantell as
Chairman and Jukka Ruuska as Vice-Chairman. KPMG Oy Ab was elected as the
auditor of the company.
The Meeting approved the Board's proposal for appointing a Nomination Committee
to prepare proposals concerning members of the Board of Directors and their
remunerations for the following Annual General Meeting. The Nomination
Committee will consist of the representatives of the three largest shareholders
and the Chairman of the Board of Directors, acting as an expert member, if
he/she is not appointed representative of a shareholder. The members
representing the shareholders will be appointed by the three shareholders whose
share of ownership of the shares of the company is largest on 31 October
preceding the Annual General Meeting.
The Meeting approved the Board's proposal for issuing stock options 2013. The
maximum total number of stock options issued will be 400 000 and they will be
issued gratuitously or for consideration determined by the Board of Directors.
According to the Articles of Association, the General Meeting of Shareholders
annually elects the Board of Directors by a majority decision. The term of
office of the board members expires at the end of the next Annual General
Meeting of Shareholders following their election. The Board appoints the CEO.
The Articles of Association do not contain any special rules for changing the
Articles of Association or for issuing new shares.
THE AUTHORIZATIONS GIVEN TO THE BOARD OF DIRECTORS
The Board has not used in the review period the authorizations given by the
Annual General Meeting in 2012, which authorizations expired on 9 April 2013.
The complete contents of the new authorizations given by the Annual General
Meeting held on 9 April 2013 have been published in the stock exchange release
regarding the Meetings' decisions. Key facts about the authorizations:
The Annual General Meeting decided to authorize the Board of Directors to
decide to acquire the company's own shares with distributable funds. A maximum
of 2 100 000 shares may be acquired. The authorization shall be in force until
the next Annual General Meeting.
The Annual General Meeting decided to authorize the Board of Directors to
decide to issue new shares and to convey the company's own shares held by the
company in one or more tranches. The share issue may be carried out as a share
issue against consideration or without consideration on terms to be determined
by the Board of Directors and in relation to a share issue against
consideration at a price to be determined by the Board of Directors. A maximum
of 4 200 000 new shares may be issued. A maximum of 2 100 000 own shares held
by the company may be conveyed. In addition, the authorization includes the
right to decide on a share issue without consideration to the company itself so
that the amount of own shares held by the company after the share issue is a
maximum of one-tenth (1/10) of all shares in the company. The authorization
shall be in force until the next Annual General Meeting.
SHARES AND TRADING
During the review period a total of 349 667 new shares have been subscribed
with the 2008B and 2008C options.
The company has only one share series and all shares have similar rights. At
the end of the review period Affecto Plc's share capital consisted of 21 892
735 shares. The company owned 78 427 treasury shares and Affecto Management Oy
owned 823 000 shares.
In 1-6/2013 the highest share price was 4.55 euro, the lowest price 2.98 euro,
the average price 3.77 euro and the closing price 3.92 euro. The trading volume
was 2.6 million shares, corresponding to 24% of the number of shares at the end
of the period. The market value of shares was 85.5 MEUR at the end of the
period including the shares owned by Affecto Management Oy but excluding the
treasury shares.
2008C options have been listed on Nasdaq OMX Helsinki since 2 April 2013. 2008B
options expired in May.
SHAREHOLDERS
The company had a total of 2708 owners on 30 June 2013 and the foreign
ownership was 13%. The list of the largest owners can be found in the company's
web site. Information about the ownership structure and option programs is
included as a separate section in the financial statements. The ownership of
the board members, CEO and their controlled corporations totaled approx. 14.3%.
ASSESSMENT OF RISKS AND UNCERTAINTIES
The changes in the general economic conditions and the operating environment of
customers have direct impact in Affecto's markets. The uncertain economy may
affect Affecto's customers negatively, and their slower investment decision
making, postponing or cancellation of IT investments may have negative impact
on Affecto. Slower decision making by customers may decrease the predictability
of the business and may decrease the utilisation rate of resources.
Affecto's order backlog has traditionally been only for a few months, which
decreases the reliability of longer-term forecasts. Affecto sells third party
software licenses as part of its solutions. Typically the license sales have
most impact on the last month of each quarter and especially in the fourth
quarter. This increases the fluctuation in net sales between quarters and
increases the difficulty of accurately forecasting the quarters. Affecto had
license sales of approx. 10 MEUR in 2012.
Affecto's balance sheet includes a material amount of goodwill. Goodwill has
been allocated to cash generating units. Cash generating units, to which
goodwill has been allocated, are tested for impairment both annually and
whenever there is an indication that the unit may be impaired. Potential
impairment losses may have material effect on reported profit and value of
assets. The greatest uncertainty is related to Sweden.
Approximately a half of Affecto's business is in Sweden, Norway and Denmark,
thus the development of the currencies of these countries (SEK, NOK and DKK)
may have impact on Affecto's profitability. The main part of the companies'
income and costs are within the same currency, which decreases the risks.
Affecto's success depends also on good customer relationships. Affecto has a
well-diversified customer base. Although none of the customers is critically
large for the whole group, there are large customers in various countries who
are significant for local business in the country.
Affecto's bank loan has covenants, the breach of which may lead to higher
financing costs or even the termination of the loan. The covenants are based on
total net debt to earnings before interest, taxes, depreciation and
amortization and total net debt to total equity.
Affecto's continued success is very much dependent on its management team and
personnel. The loss of the services of any member of its senior management or
other key employee could have a negative impact on Affecto's business and the
ability of the company to implement its strategy. In addition, Affecto's
success depends on its ability to hire, develop, train, motivate and retain
skilled professionals on its staff.
FUTURE OUTLOOK
Net sales are estimated to grow in 2013. Operating profit is estimated to be
near last year's level. Earlier guidance was: Operating profit and net sales
are estimated to grow in 2013.
As a normal seasonality effect, the summer vacations will weaken the third
quarter.
The company does not provide exact guidance for net sales or EBIT development,
as single projects and timing of license sales may have large impact on
quarterly sales and profit.
Affecto Plc
Board of Directors
You can order Affecto's stock exchange releases to be delivered automatically
by e-mail.
Please visit the Investors section of the company website: www.affecto.com
A briefing for analysts and media will be arranged at 12.30 at Restaurant
Savoy, Eteläesplanadi 14, Helsinki.
www.affecto.com
-----
Financial information:
1. Consolidated income statement, consolidated comprehensive income statement,
balance sheet, cash flow statement and statement of changes in equity
2. Notes
3. Key figures
1. Consolidated income statement, consolidated comprehensive income statement,
balance sheet, cash flow statement and statement of changes in equity
CONSOLIDATED INCOME STATEMENT
(1 000 EUR) 4-6/201 4-6/201 1-6/201 1-6/201 2012 Last
3 2 3 2 12m
---------------------------------------------------
---------------------------------------------------
Net sales 34 810 33 138 69 203 66 678 133 135
400 925
Other operating income 6 13 7 18 221 210
Changes in inventories of -79 -44 358 -1 -94 265
finished
goods and work in progress
Materials and services -7 357 -6 149 -15 201 -12 209 -27 -30
072 063
Personnel expenses -19 992 -19 177 -39 774 -39 421 -75 -75
542 895
Other operating expenses -4 587 -4 244 -8 936 -8 662 -17 -17
106 380
Other depreciation and -314 -325 -608 -648 -1 290 -1 250
amortisation
IFRS3 amortisation -517 -510 -1 040 -1 021 -2 067 -2 086
Operating profit 1 971 2 702 4 008 4 733 10 451 9 726
Financial income and -150 -112 -123 -264 -408 -267
expenses
Profit before income tax 1 821 2 590 3 885 4 469 10 042 9 459
Income tax -616 -574 -1 143 -996 -2 467 -2 614
Profit for the period 1 205 2 016 2 742 3 473 7 575 6 844
Profit for the period
attributable to:
Owners of the parent company 1 113 1 950 2 660 3 430 7 552 6 782
Non-controlling interest 92 66 82 43 23 63
Earnings per share
(EUR per share):
Basic 0.05 0.09 0.13 0.17 0.37 0.33
Diluted 0.05 0.09 0.13 0.16 0.36 0.33
CONSOLIDATED STATEMENT OF
COMPREHENSIVE INCOME
(1 000 EUR) 4-6/201 4-6/201 1-6/201 1-6/201 2012 Last
3 2 3 2 12m
---------------------------------------------------
---------------------------------------------------
Profit for the period 1 205 2 016 2 742 3 473 7 575 6 844
Other comprehensive income
Items that may be
reclassified subsequently
to the statement of income:
Translation difference -1 961 362 -1 817 870 1 723 -964
Total Comprehensive income -756 2 378 926 4 343 9 298 5 880
for the period
Total Comprehensive income
attributable to:
Owners of the parent company -849 2 312 843 4 300 9 275 5 818
Non-controlling interest 92 66 82 43 23 63
CONSOLIDATED BALANCE SHEET
(1 000 EUR) 6/2013 6/2012 12/2012
--------------------------
--------------------------
Non-current assets
Property, plant and equipment 2 037 1 986 1 711
Goodwill 73 157 73 850 74 651
Other intangible assets 3 091 5 100 4 098
Available-for-sale financial assets - 41 -
Deferred tax assets 1 500 1 615 1 506
Trade and other receivables 7 11 11
79 792 82 604 81 977
Current assets
Inventories 677 429 317
Trade and other receivables 37 193 39 333 45 529
Current income tax receivables 579 794 325
Cash and cash equivalents 14 566 12 651 19 767
53 015 53 207 65 937
--------------------------------------------------------------
--------------------------------------------------------------
Total assets 132 807 135 811 147 914
Equity attributable to owners
of the parent Company
Share capital 5 105 5 105 5 105
Reserve of invested non-restricted 47 300 46 611 46 643
equity
Other reserves 718 651 693
Treasury shares -2 202 -2 262 -2 202
Translation differences -871 93 946
Retained earnings 14 996 11 711 15 781
--------------------------------------------------------------
--------------------------------------------------------------
65 046 61 909 66 965
Non-controlling interest 394 420 311
Total equity 65 439 62 329 67 277
Non-current liabilities
Loans and borrowings 24 403 28 371 26 387
Deferred tax liabilities 707 1 297 987
25 110 29 668 27 374
Current liabilities
Loans and borrowings 4 000 4 000 4 000
Derivative financial instruments - 260 -
Trade and other payables 35 940 36 899 46 745
Current income tax liabilities 2 068 2 027 2 159
Provisions 249 629 359
42 257 43 814 53 263
Total liabilities 67 367 73 482 80 638
--------------------------------------------------------------
--------------------------------------------------------------
Equity and liabilities 132 807 135 811 147 914
SUMMARY CONSOLIDATED CASH FLOW STATEMENT
(1 000 EUR) 1-6/2013 1-6/2012 2012
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Cash flows from operating activities
Profit for the period 2 742 3 473 7 575
Adjustments to profit for the period 3 100 3 053 6 449
5 842 6 526 14 024
Change in working capital -2 904 -4 762 -1 340
Interest and other financial cost paid -289 -612 -1 207
Interest and other financial income received 100 75 165
Income taxes paid -1 660 -1 434 -2 525
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Net cash from operating activities 1 089 -207 9 117
Cash flows from investing activities
Acquisition of tangible and intangible assets -1 063 -648 -1 008
Acquisition of available-for-sale financial assets - -35 -
Proceeds from sale of tangible and 1 8 49
intangible assets
Net cash used in investing activities -1 061 -675 -959
------------------------------------------------------------------------------
Cash flows from financing activities
Repayments of non-current borrowings -2 000 -2 000 -4 000
Acquisition of treasury shares - -266 -266
Proceeds from share options exercised 657 20 49
Acquisition of non-controlling interest - - -134
Dividends paid to the owners -3 444 -2 367 -2 367
of the parent company
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Net cash from financing activities -4 788 -4 614 -6 718
(Decrease)/increase in cash and cash equivalents -4 760 -5 495 1 440
Cash and cash equivalents 19 767 17 964 17 964
at the beginning of the period
Foreign exchange effect on cash -440 182 363
Cash and cash equivalents 14 566 12 651 19 767
at the end of the period
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Equity attributable to owners of the parent
company
------------------------------------------------------
--------
(1 000 Share Reserve of Other Treasu Trans Ret. Non-cont Total
EUR) capita invested reserv ry lat. earnin rolling equity
l non-restric es shares diff. gs interest
ted equity
----------------------------------------------
Equity 5 105 46 643 693 -2 202 946 15 781 311 67 277
at 1
January
2013
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Profit 2 660 82 2 742
Translat -1 817 -1 817
ion
differe
nces
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Total - 1 817 2 660 82 926
compre-
hensive
income
Share-ba 25 25
sed
payment
s
Exercise 657 657
of
share
options
Dividend -3 444 -3 444
s paid
Equity 5 105 47 300 718 -2 202 -871 14 996 394 65 439
at 30
June
2013
--------------------------------------------------------------------------------
Equity attributable to owners of the parent
company
------------------------------------------------------
--------
(1 000 Share Reserve of Other Treasu Trans Ret. Non-con Total
EUR) capita invested reserv ry lat. earnin trollin equity
l non-restrict es shares diff. gs g
ed equity interes
t
----------------------------------------------
Equity at 5 105 46 591 593 -1 996 -777 10 642 376 60 535
1
January
2012
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Profit 3 430 43 3 473
Translati 870 870
on
differen
ces
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Total 870 3 430 43 4 343
compre-h
ensive
income
Share-bas 58 58
ed
payments
Exercise 20 20
of share
options
Acquisiti -266 -266
on of
treasury
shares
Other 6 6
movement
s
Dividends -2 367 -2 367
paid
Equity at 5 105 46 611 651 -2 262 93 11 711 420 62 329
30 June
2012
--------------------------------------------------------------------------------
2. Notes
2.1. Basis of preparation
This condensed interim financial information has been prepared in accordance
with IAS 34, Interim Financial reporting. The condensed interim financial
report should be read in conjunction with the annual financial statements for
the year ended 31 December 2012. The same accounting policies have been applied
as in the annual consolidated financial statements with the exception of the
amendments to the IFRS standards that have entered into force and have been
applied on 1 January 2013, which amendments have been presented in the previous
annual financial statements. These amendments had no material impact on this
interim report.
The non-controlling interest has been presented separately after net profit for
the period and in total equity.
2.2. Segment information
Affecto's reporting segments are based on geographical locations and are
Finland, Norway, Sweden, Denmark and Baltic.
Segment net sales and result
(1 000 EUR) 4-6/201 4-6/201 1-6/201 1-6/20 2012 Last
3 2 3 12 12m
----------------------------------------------------
----------------------------------------------------
Total net sales
Finland 14 253 13 729 27 034 27 181 52 570 52 423
Norway 7 609 6 607 16 074 13 255 27 161 29 980
Sweden 6 206 5 772 12 273 12 343 23 984 23 914
Denmark 4 263 3 634 8 097 7 339 16 038 16 795
Baltic 3 912 4 045 8 166 7 818 16 684 17 032
Other -1 433 -649 -2 441 -1 257 -3 036 -4 220
Group total 34 810 33 138 69 203 66 678 133 400 135 925
--------------------------------------------------------------------------------
Operational segment result
Finland 1 747 2 134 3 164 3 962 7 747 6 948
Norway 766 654 1 710 1 317 3 317 3 710
Sweden -187 -101 -330 -297 -945 -978
Denmark 471 269 781 524 1 800 2 057
Baltic 74 495 388 853 1 981 1 516
Other -384 -239 -664 -604 -1 382 -1 441
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Total operational segment 2 488 3 212 5 048 5 754 12 518 11 812
result
IFRS3 amortisation -517 -510 -1 040 -1 021 -2 067 -2 086
Operating profit 1 971 2 702 4 008 4 733 10 451 9 726
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Net sales by business lines
(1 000 EUR) 4-6/201 4-6/201 1-6/201 1-6/20 2012 Last
3 2 3 12 12m
----------------------------------------------------
----------------------------------------------------
Information Management 32 575 30 209 64 740 61 203 122 892 126 429
Solutions
Karttakeskus GIS business 2 964 3 241 5 732 6 106 11 884 11 510
Other -728 -313 -1 269 -630 -1 376 -2 014
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Group total 34 810 33 138 69 203 66 678 133 400 135 925
2.3. Changes in intangible and tangible assets
(1 000 EUR) 1-6/2013 1-6/2012 1-12/2012 ------------------------------
------------------------------
Carrying amount at the beginning of period 80 460 81 127 81 127
Additions 1 063 648 1 008
Disposals -1 -3 -30
Depreciation and amortization for the period - 1 648 - 1 699 - 3 357
Exchange rate differences -1 588 833 1 711
Carrying amount at the end of period 78 285 80 936 80 460
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2.4. Share capital, reserve of invested non-restricted equity and treasury
shares
(1 000 EUR) Number of Share Reserve of invested Treasury
shares capital non-restricted equity shares
outstanding
--------------------------------------------------------------
--------------------------------------------------------------
1.1.2012 20 693 468 5 105 46 591 -1 996
Exercise of share 10 500 - 20 -
options
Acquisition of -100 000 - - -266
treasury shares
30.6.2012 20 603 968 5 105 46 611 -2 262
1.1.2013 20 641 641 5 105 46 643 -2 202
Exercise of share 349 667 - 657 -
options
30.6.2013 20 991 308 5 105 47 300 -2 202
At the end of reporting period Affecto Plc owned 78 427 treasury shares. In
addition to that Affecto Management Oy, included in consolidated accounts,
owned 823 000 shares in Affecto Plc. In total these 901 427 shares correspond
to 4.1% of the total amount of the shares. The amount of registered shares was
21 892 735 shares.
2.5. Interest-bearing liabilities
(1 000 EUR) 30.6.2013 31.12.2012
Interest-bearing non-current liabilities
Loans from financial institutions, 24 403 26 387
non-current portion
Loans from financial institutions, 4 000 4 000
current portion
---------------------------------------------------------------
---------------------------------------------------------------
28 403 30 387
Affecto's loan facility agreement includes financial covenants, breach of which
might lead to an increase in cost of debt or cancellation of the facility
agreement. The covenants are based on total net debt to earnings before
interest, taxes, depreciation and amortization and total net debt to total
equity. The covenants will be measured quarterly, and these terms and
conditions of covenants were met at the end of the reporting period.
2.6. Contingencies and commitments
The future aggregate minimum lease payments under non-cancelable operating
leases:
(1 000 EUR) 30.6.2013 31.12.2012
Not later than one (1) year 3 734 3 966
Later than one (1) year, 4 859 6 594
but not later than five (5) years
Later than five (5) years - -
Total 8 593 10 561
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Guarantees given:
(1 000 EUR) 30.6.2013 31.12.2012
Liabilities secured by a mortgage
Financial loans 28 500 30 500
The above-mentioned liabilities are secured by bearer bonds with a nominal
value of 52.5 million euro. The bonds are held by Nordea Pankki Suomi Oyj and
secured by a mortgage on company assets of the group companies. In addition,
the shares in Affecto Finland Oy and Affecto Norway AS have been pledged to
secure the financial liabilities above.
Other securities given on own behalf:
(1 000 EUR) 30.6.2013 31.12.2012
Pledges 8 6
Other guarantees 2 946 3 559
Other guarantees are mostly securities issued for customer projects. These
guarantees include both bank guarantees secured by parent company of the group
and guarantees issued by the parent company and subsidiaries.
2.7. Related party transactions
Key management compensation and remunerations to the board of directors:
(1 000 EUR) 1-6/2013 1-6/2012 1-12/2012
Salaries and other short-term employee benefits 1 061 1 157 2 184
Post-employment benefits 152 170 279
Termination benefits 6 - 245
Share-based payments 2 8 13
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Total 1 221 1 334 2 721
Loans to related party:
(1 000 EUR) 30.6.2013 30.6.2012 31.12.2012
Loans to key management of the group 1 600 1 600 1 624
Purchases from related party:
(1 000 EUR) 1-6/20 1-6/20 1-12/2
13 12 012
Purchases from the entity that are controlled by key 5 - -
management personnel of the group
3. Key figures
4-6/201 4-6/201 1-6/201 1-6/201 2012 Last
3 2 3 2 12m
-----------------------------------------------------
-----------------------------------------------------
Net sales, 1 000 eur 34 810 33 138 69 203 66 678 133 400 135 925
EBITDA, 1 000 eur 2 802 3 537 5 657 6 403 13 808 13 062
Operational segment 2 488 3 212 5 048 5 754 12 518 11 812
result,
1 000 eur
Operating result, 1 000 1 971 2 702 4 008 4 733 10 451 9 726
eur
Result before taxes, 1 000 1 821 2 590 3 885 4 469 10 042 9 459
eur
Profit attributable to the 1 113 1 950 2 660 3 430 7 552 6 782
owners
of the parent company, 1
000 eur
EBITDA, % 8.1 % 10.7 % 8.2 % 9.6 % 10.4 % 9.6 %
Operational segment 7.1 % 9.7 % 7.3 % 8.6 % 9.4 % 8.7 %
result, %
Operating result, % 5.7 % 8.2 % 5.8 % 7.1 % 7.8 % 7.2 %
Result before taxes, % 5.2 % 7.8 % 5.6 % 6.7 % 7.5 % 7.0 %
Net income for equity 3.2 % 5.9 % 3.8 % 5.1 % 5.7 % 5.0 %
holders
of the parent company, %
Equity ratio, % 53.5 % 50.1 % 53.5 % 50.1 % 50.6 %
Net gearing, % 21.1 % 31.6 % 21.1 % 31.6 % 15.8 %
Interest-bearing net debt, 13 837 19 720 13 837 19 720 10 621
1 000 eur
Gross investment in 568 239 1 063 648 1 008
non-current
assets (excl.
acquisitions),
1 000 eur
Gross investments, % of 1.6 % 0.8 % 1.5 % 1.0 % 0.8 %
net sales
Order backlog, 1 000 eur 48 824 53 842 48 824 53 842 61 359
Average number of 1 081 1 088 1 082 1 082 1 089
employees
Earnings per share, eur 0.05 0.09 0.13 0.17 0.37 0.33
Earnings per share 0.05 0.09 0.13 0.16 0.36 0.33
(diluted),
eur
Equity per share, eur 3.10 3.00 3.10 3.00 3.24
Average number of shares, 20 768 20 655 20 706 20 674 20 642 20 629
1 000 shares
Number of shares at the 20 991 20 604 20 991 20 604 20 642 20 991
end of
period, 1 000 shares
Calculation of key figures
EBITDA = Earnings before interest, taxes,
depreciation, amortization and impairment losses
Operational segment result = Operating profit before amortizations on
fair value adjustments due to business
combinations (IFRS3) and goodwill
impairments
Equity ratio, % = Total equity *100
________________________________
Total assets - advance payments
Gearing, % = Interest-bearing liabilities - cash *100
and cash equivalents
__________________________________
Total equity
Interest-bearing net debt = Interest-bearing liabilities - cash and
cash equivalents
Earnings per share (EPS) = Profit attributable to owners of the parent
company
______________________________________
Weighted average number of ordinary shares in
issue during the period
Equity per share = Total equity
______________________________________
Adjusted number of shares at the end of
the period
Market capitalization = Number of shares at the end of period
(excluding company's own shares held by
the company) x share price at closing date
-----
CEO Pekka Eloholma, +358 205 777 737
CFO Satu Kankare, +358 205 777 202
SVP, M&A, IR, Hannu Nyman, +358 205 777 761
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