2007-07-13 07:15:00 CEST
2007-07-13 07:15:00 CEST
REGULATED INFORMATION
PKC Group Oyj - Quarterly report
PKC GROUP QUARTERLY REPORT JANUARY-JUNE 2007
The PKC Group's net sales in the January-June period increased by 31.4 % on the
previous year to EUR 143.6 million (109.3 million). Operating profit was EUR
13.8 million (15.0 million) and profit before taxes was EUR 13.2 million (14.6
million). Diluted earnings per share were EUR 0.55 (0.55).
MIKA KARI, PRESIDENT AND CEO:
”The Group continued to grow strongly in both business segments. Thanks to the
actions we carried out, we were able to meet the need for increased capacity.
With our main customers enjoying increased volumes and as we expanded into new
market areas, net sales in our Wiring Harnesses business showed strong growth on
the previous year. In spite of the expansion of operations, we achieved a good
level of operating profit.
In our Electronics business, we racked up significant growth in both contract
manufacturing and design. During the latter part of the year, we will invest in
starting up operations in China. The ability in the years ahead to offer
cost-effective contract manufacturing services in China too will bring an
improvement in our position as a partner of the telecommunications and
electrotechnical industry.
For our customer industries, the development outlook for the latter part of the
year remains favourable. We are pushing ahead with actions to boost capacity and
improve efficiency in order to meet growing customer needs and to maintain a
good level of profitability in coming years as well.”
OPERATING ENVIRONMENT
The commercial vehicle market showed growth compared with the same period a year
ago. Deliveries by the Wiring Harnesses business to the commercial vehicle
industry in Europe and South America were at a high level. Deliveries for other
types of vehicle were likewise at a good level. Sales of wiring harnesses and
cabling to the telecommunications industry declined somewhat from the same
period a year earlier owing to low demand from certain customers in the early
part of the year.
Demand for electronics contract design and manufacturing showed favourable
growth in the report period. In the face of a tough competitive situation,
suppliers must have cost-effective operational models in place and be able to
respond swiftly to customers' changing needs, at home and worldwide.
NET SALES AND FINANCIAL PERFORMANCE
April-June 2007
Consolidated net sales in April-June amounted to EUR 73.7 million (EUR 54.8
million), up 34.4 % on the same period a year earlier. Consolidated operating
profit totalled EUR 7.3 million (6.8 million), amounting to 10.0 % of net sales
(12.5 %). Depreciation amounted to EUR 1.6 million (1.5 million). Financial
income and expenses were EUR 0.2 million negative (0.6 million negative). Profit
before taxes was EUR 7.1 million (6.2 million). Profit for the report period
rose to EUR 5.4 million (EUR 4.0 million). Diluted earnings per share were EUR
0.30 (0.22).
Net sales generated by the Wiring Harnesses business during the report period
were EUR 59.8 million (42.8 million), up 39.7 % on the comparison period. Its
share of consolidated net sales was 81.1 % (78.0 %). Operating profit was EUR
5.6 million (5.1 million), or 9.3 % (11.8 %) of the segment's net sales.
Net sales generated by the Electronics business segment rose by 15.5 % to EUR
13.9 million (12.0 million), representing 19.0% of consolidated net sales (22.0
%). Operating profit was EUR 1.8 million (1.8 million), or 12.5 % (14.2 %) of
the segment's net sales.
January-June 2007
The PKC Group's net sales increased by 31.4 % on the previous year, reaching EUR
143.6 million (109.3 million). Consolidated operating profit totalled EUR 13.8
million (15.0 million), amounting to 9.6 % of net sales (13.7 %). Aggregate
depreciation amounted to EUR 3.7 million (3.0 million). Financial income and
expenses were EUR 0.6 million negative (0.4 million negative). Profit before
taxes was EUR 13.2 million (14.6 million). Profit for the report period was EUR
9.7 million (EUR 9.9 million). Diluted earnings per share were EUR 0.55 (0.55).
Net sales generated by the Wiring Harnesses business during the report period
rose by 36.8 % to EUR 117.9 million (86.2 million). Its share of consolidated
net sales was 82.1 % (78.8 %). Operating profit of the Wiring Harnesses business
totalled EUR 10.5 million (11.8 million), amounting to 8.9 % of the segment's
net sales (13.6 %).
The Electronics business segment saw a rise in net sales of 11.3 % to EUR 25.8
million (23.1 million), accounting for 17.9 % of consolidated net sales (21.2
%). The Electronics business segment reported operating profit of EUR 3.3
million (3.3 million), amounting to 12.6 % of the segment's net sales (13.8 %).
The Group's full-year net sales grew in both business segments, and a good level
of profitability was maintained. World market prices of raw materials have
remained at a high level. We were able to meet increased demand by increasing
production capacity. The integration of operations in North America is moving
ahead, but the earnings trend has not been in line with expectations.
Production volumes at the new factory in Pskov, Russia were increased as
planned.
BALANCE SHEET AND FINANCING
Consolidated total assets at 30 June 2007 stood at EUR 163.6 million (120.2
million). Interest-bearing liabilities totalled EUR 56.5 million at the close of
the report period (25.9 million). The Group's equity ratio was 45.9 % (56.0 %).
Net liabilities totalled EUR 48.6 million (22.8 million) and gearing was 64.7 %
(33.9 %).
Inventories amounted to EUR 37.5 million (27.7 million). Current receivables
totalled EUR 74.2 million (53.7 million). Cash flows from investing activities
were EUR 3.7 million negative (5.3 million). Cash in hand and at bank amounted
to EUR 7.9 million (3.0 million). In order to ensure financing flexibility, PKC
has available credit facilities.
CAPITAL EXPENDITURES
During the review period, the Group's gross capital expenditures totalled EUR
4.5 million (4.8 million), amounting to 3.2 % of net sales (4.4 %). Capital
expenditures went mainly for production machinery and equipment.
RESEARCH & DEVELOPMENT
Research and development expenditure totalled EUR 2.7 million (2.4 million),
representing 1.9% (2.2%) of consolidated net sales. At the end of the report
period, 77 (70) people were employed in product development.
PERSONNEL
The Group had an average payroll during the report period of 4,816 employees
(3,591). The Group's staff at the end of the report period numbered 4,892
employees (3,617), of whom 4,155 (2,897) worked abroad and 737 (720) in Finland.
The increase in personnel strength was due to the acquisition of operations in
North America as well as to the growth in production volumes at units abroad.
QUALITY AND THE ENVIRONMENT
The Group's Wiring Harnesses business has been certified under the ISO/TS 16949
and ISO 9001 standards and in accordance with the ISO 14001 certificate. The new
factories n China and Russia are preparing for certification under ISO/TS 16949
and ISO 14001. The Wiring Harnesses operations in North America have been
certified according to ISO/TS 16949 and the objective is to have the
environmental system at the Mexico factory certified under ISO 14001 right at
the start of 2008. The Electronics business has been certified according to the
ISO 9001 standard.
The development of operational quality is guided by the Group's quality strategy
and the action plans based on it. In accordance with its environmental policy,
PKC has given its commitment to continuously reduce the environmental impacts of
its operations.
ANNUAL GENERAL MEETING
The Annual General Meeting on 29 March 2007 passed a resolution to pay a
dividend of EUR 0.45 per share, or a total of about EUR 8.0 million. The
dividend was paid out on 12 April 2007.
The Annual General Meeting re-elected the following persons to seats on the
Board of Directors: Matti Eestilä, Jaakko Niemelä, Endel Palla, Matti Ruotsala,
Harri Suutari and Jyrki Tähtinen. Olli Pohjanvirta was elected to the Board of
Directors as a new member. At its organisational meeting, the Board of Directors
elected Harri Suutari chairman and Jyrki Tähtinen vice chairman.
Ernst & Young Oy, Authorised Public Accountant Firm, will continue as the
company's auditor, with Rauno Sipilä, Authorised Public Accountant, as the
responsible auditor.
In accordance with the proposals of the Board of Directors, the Annual General
Meeting also resolved to authorise the Board to decide on one or more share
issues and granting of special rights defined in Chapter 10, Section 1 of the
Companies Act and on all the terms and conditions thereof. The authorisation
shall remain in force for five years from the passing of the resolution of the
Annual General Meeting.
The Annual General meeting also resolved to amend the Articles of Association
mainly due to the new Finnish Companies Act.
MANAGEMENT CHANGES
Sami Klemola (36), M.Sc. (admin.) LL.M. took over as Group`s CFO on 1 May 2007.
His area of responsibility is Group finance and administration.
SHARE TURNOVER AND SHAREHOLDERS
The trade volume of the PKC Group Oyj share on the Helsinki Stock Exchange from
1 January to 30 June 2007 was 10,570,972 shares (6,411,634), representing 59.4 %
of the average number of shares (36.2 %). Shares were traded to a total value of
EUR 112.4 million (77.3 million). The low during the report period was EUR 9.17
(10.60) and the high was EUR 12.40 (14.08). The closing price on the last
trading day of the report period was EUR 10.59 (12.95) and the average price
during the period was EUR 10.65 (12.04). The company's market capitalisation at
30 June 2007 was EUR 188.3 million (230.3 million).
Shares held by Board members and their closely associated persons and controlled
corporations accounted for 2.9 % (5.0 %) of the total number of shares at the
end of the report period. PKC Group Oyj had 6,539 shareholders (4,722) at the
end of the period. The proportion of shares held by foreigners and by way of
nominee registrations at 30 June 2007 was 27.8 % of the shares outstanding (28.0
%).
AS Harju Elekter's proportion of PKC Group Oyj's voting rights and share capital
fell below the one tenth (1/10) limit on 15 May 2007.
SHARE CAPITAL
The Board of Directors has been granted authorisation by the Annual General
Meeting on 29 March 2007 to decide on one or more share issues and granting of
special rights defined in Chapter 10, Section 1 of the Companies Act and on all
the terms and conditions thereof. A maximum total of 3,500,000 shares may be
issued or subscribed for on the basis of authorisation. The authorisation
includes the right to decide on directed share issue. The authorisation shall be
in force for five years from the date of the resolution by the Annual General
Meeting. At the Board's discretion, the authorisation may be used for financing
corporate acquisitions, inter-company co-operation or similar arrangement, or
strengthening the Company's financing and capital structure.
The Board of Directors does not have a valid authorisation to acquire company's
own shares and the company does not have own shares (treasury shares) in its
possession.
STOCK OPTION SCHEMES
In 2006, PKC launched a stock option scheme according to which the total maximum
number of stock options to be issued is 697,500 and they are divided into A, B
and C warrants. During the report period, stock options were distributed to key
personnel in accordance with the terms and conditions of the stock options by
virtue of a decision taken by the Board of Directors on 29 March 2007. Key
personnel were granted a total of 47,500 2006 A warrants and 221,000 2006 B
warrants, after which key personnel held a total of 202,500 2006 A warrants and
221,000 2006 B warrants.
The subscription period for shares through the exercise of stock options is
during the years 2009-2013. The share subscription price for stock options shall
be the volume-weighted average price of the PKC Group Oyj share on the Helsinki
Stock Exchange, with dividend adjustments as defined in the stock option terms
(at present, EUR 11.09 with the 2006 A and 2006 B warrants). Through the
exercise of the 2006 stock options, the share capital of PKC Group Oyj may be
increased by a total maximum of 697,500 new shares and EUR 234,673.67. The stock
options 2006 are subject to a share ownership plan. Key personnel are obliged to
subscribe for or purchase the Company's shares with 20 % of the gross income
earned from stock options and to own these shares for two years. The Company's
President and CEO is obliged to own these shares for the duration of his
managerial contract.
SHORT-TERM RISKS AND UNCERTAINTIES
The PKC Group strives to manage and limit any adverse effects of risks
encountered in its operations. The main risks are the market trend in demand for
the products of its main customers, price pressures imposed by customers and
demands for tighter contractual terms, the availability of and changes in world
market prices of raw materials and components as well as the adequacy of
production capacity when demand rises rapidly.
The principles, objectives and organisation of the company's risk management as
well as key risk areas are described in the risk management section in the
Corporate Governance guidelines, which are available on the company's website,
www.pkcgroup.com.
OUTLOOK FOR THE FUTURE
The market for heavy trucks as well as vehicles and work machines is expected to
grow further during the autumn, with the Group's delivery volumes forecast to
keep rising. Deliveries of wiring harnesses to the telecommunications and
automation industry are estimated to remain at the previous level or to grow
somewhat. In the Wiring Harnesses business, full-year net sales are likewise
expected to grow, even without the additional net sales brought by the
operations in North America.
It is estimated that the market for electronics contract design and
manufacturing is estimated to grow over last year, with continuing tough
competition. Net sales generated by the Electronics business are expected to
grow compared with the previous year.
The PKC Group will start up electronics component sourcing operations and
contract manufacturing in China during the current year.
Consolidated net sales are expected to grow both organically and due to
acquisition in North America significantly compared with last year. The
expectations for higher net sales are supported by the growth in demand forecast
by customers. Despite high prices of raw materials and costs related to the
capacity increase, relative profitability over the full year is forecast to
continue to remain at a good level. Because of the consolidation trend in
customer industries, the competitive situation is expected to tighten from the
previous.
--------------------------------------------------------------------------------
| CONSOLIDATED INCOME | 4-6/07 | 4-6/06 | 1-6/07 | 1-6/06 | 1-12/06 |
| STATEMENT (1000 EUR) | 3 | 3 | 6 mon. | 6 mon. | 12 |
| | mon. | mon. | | | mon. |
--------------------------------------------------------------------------------
| NET SALES | 73,670 | 54,813 | 143,637 | 109,341 | 228,928 |
--------------------------------------------------------------------------------
| Operating expenses | 64,707 | 46,463 | 126,116 | 91,353 | 198,369 |
--------------------------------------------------------------------------------
| Depreciation and | 1,625 | 1,512 | 3,709 | 2,967 | 6,310 |
| amortisation | | | | | |
--------------------------------------------------------------------------------
| OPERATING PROFIT | 7,339 | 6,838 | 13,812 | 15,021 | 24,249 |
--------------------------------------------------------------------------------
| Financial income and | -194 | -635 | -574 | -446 | -1,498 |
| expenses | | | | | |
--------------------------------------------------------------------------------
| PROFIT BEFORE TAXES | 7,146 | 6,202 | 13,239 | 14,575 | 22,751 |
--------------------------------------------------------------------------------
| Direct taxes | -1,703 | -2,129 | -3,422 | -4,618 | -7,044 |
--------------------------------------------------------------------------------
| PROFIT BEFORE MINORITY | 5,443 | 4,074 | 9,817 | 9,956 | 15,708 |
| INTEREST | | | | | |
--------------------------------------------------------------------------------
| Minority interest | -59 | -32 | -112 | -92 | -155 |
--------------------------------------------------------------------------------
| PROFIT FOR THE REPORT | 5,384 | 4,042 | 9,705 | 9,864 | 15,552 |
| PERIOD | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Earnings per share | 0.30 | 0.23 | 0.55 | 0.56 | 0.88 |
| (EPS), EUR | | | | | |
--------------------------------------------------------------------------------
| Earnings per share | 0.30 | 0.22 | 0.55 | 0.55 | 0.87 |
| (EPS), diluted, EUR | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| CONSOLIDATED BALANCE SHEET (1000 EUR) | 6/07 | 6/06 | 12/06 |
--------------------------------------------------------------------------------
| ASSETS | | | |
--------------------------------------------------------------------------------
| Non-current assets | 43,978 | 35,754 | 43,647 |
--------------------------------------------------------------------------------
| Intangible assets | 9,721 | 4,279 | 9,053 |
--------------------------------------------------------------------------------
| Tangible assets | 31,639 | 29,689 | 31,468 |
--------------------------------------------------------------------------------
| Available-for-sale investments | 15 | 15 | 15 |
--------------------------------------------------------------------------------
| Deferred tax assets | 2,328 | 1,670 | 2,486 |
--------------------------------------------------------------------------------
| Other receivables | 274 | 100 | 625 |
--------------------------------------------------------------------------------
| Current assets | 119,641 | 84,426 | 107,369 |
--------------------------------------------------------------------------------
| Inventories | 37,523 | 27,709 | 36,589 |
--------------------------------------------------------------------------------
| Receivables | 74,215 | 53,669 | 62,720 |
--------------------------------------------------------------------------------
| Cash in hand and at banks | 7,903 | 3,048 | 8,060 |
--------------------------------------------------------------------------------
| TOTAL ASSETS | 163,618 | 120,179 | 151,016 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| SHAREHOLDERS' EQUITY AND LIABILITIES | | |
--------------------------------------------------------------------------------
| Shareholders equity | 75,101 | 67,295 | 72,544 |
--------------------------------------------------------------------------------
| Share capital | 5,983 | 5,983 | 5,983 |
--------------------------------------------------------------------------------
| Other equity | 68,405 | 60,680 | 65,915 |
--------------------------------------------------------------------------------
| Minority interest | 713 | 632 | 646 |
--------------------------------------------------------------------------------
| Long-term liabilities | 32,062 | 15,603 | 19,717 |
--------------------------------------------------------------------------------
| Interest-bearing liabilities | 31,834 | 14,974 | 18,947 |
--------------------------------------------------------------------------------
| Non interest-bearing liabilities | 0 | 287 | 112 |
--------------------------------------------------------------------------------
| Deferred tax liabilities | 228 | 341 | 658 |
--------------------------------------------------------------------------------
| Short-term liabilities | 56,455 | 37,282 | 58,754 |
--------------------------------------------------------------------------------
| Interest-bearing liabilities | 24,671 | 10,891 | 26,068 |
--------------------------------------------------------------------------------
| Non interest-bearing liabilities | 31,784 | 26,391 | 32,686 |
--------------------------------------------------------------------------------
| EQUITY AND LIABILITIES | 163,618 | 120,179 | 151,016 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| GROUP CASH FLOW STATEMENT | 1-6/07 | 1-6/06 | 1-12/06 |
| | 6 | 6 | 1 |
| | mon. | mon. | 2 mon. |
--------------------------------------------------------------------------------
| Cash flows from operating activities | | |
--------------------------------------------------------------------------------
| Cash flows from operations before | | |
--------------------------------------------------------------------------------
| financial income and expenses and taxes | 6,010 | 15,511 | 19,074 |
--------------------------------------------------------------------------------
| Financial income and expenses and taxes | -4,431 | -5,403 | -9,094 |
--------------------------------------------------------------------------------
| NET CASH FROM OPERATING ACTIVITIES | 1,579 | 10,108 | 9,980 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Cash flows from investing activities | | |
--------------------------------------------------------------------------------
| Capital expenditure | -3,749 | -4,780 | -9,237 |
--------------------------------------------------------------------------------
| Proceeds from sale of assets | -182 | 0 | 537 |
--------------------------------------------------------------------------------
| Acquisition of subsidiaries | -1,298 | 0 | -9,985 |
--------------------------------------------------------------------------------
| NET CASH USED IN INVESTING ACTIVITIES | -5,229 | -4,780 | -18,685 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Cash flows from financial activities | | |
--------------------------------------------------------------------------------
| Proceeds from issuance of share capital | 0 | 440 | 441 |
--------------------------------------------------------------------------------
| Change of loans | 11,539 | 424 | 19,502 |
--------------------------------------------------------------------------------
| Dividends paid | -8,046 | -8,033 | -8,068 |
--------------------------------------------------------------------------------
| NET CASH USED IN FINANCIAL ACTIVITIES | 3,493 | -7,169 | 11,876 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| NET INCREASE/DECREASE IN CASH AND CASH | -157 | -1,841 | 3,171 |
| EQUIVALENTS | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| GROUP KEY FINANCIAL INDICATORS | 1-6/07 | 1-6/06 | 1-12/06 |
| | 6 | 6 | 1 |
| | mon. | mon. | 2 mon. |
--------------------------------------------------------------------------------
| Net sales, 1000 EUR | 143,637 | 109,341 | 228,928 |
--------------------------------------------------------------------------------
| Operating profit, 1000 EUR | 13,812 | 15,021 | 24,249 |
--------------------------------------------------------------------------------
| % of net sales | 9.6 | 13.7 | 10.6 |
--------------------------------------------------------------------------------
| Profit before taxes, 1000 EUR | 13,239 | 14,575 | 22,751 |
--------------------------------------------------------------------------------
| % of net sales | 9.2 | 13.3 | 9.9 |
--------------------------------------------------------------------------------
| Net profit for the period, 1000 EUR | 9,705 | 9,864 | 15,552 |
--------------------------------------------------------------------------------
| % of net sales | 6.8 | 9.0 | 6.8 |
--------------------------------------------------------------------------------
| Return on equity (ROE), % | 26.6 | 30.1 | 22.8 |
--------------------------------------------------------------------------------
| Return on investments (ROI), % | 23.7 | 32.7 | 24.1 |
--------------------------------------------------------------------------------
| Gearing, % | 64.7 | 33.9 | 50.9 |
--------------------------------------------------------------------------------
| Equity ratio, % | 45.9 | 56.0 | 48.0 |
--------------------------------------------------------------------------------
| Current ratio | 2.1 | 2.3 | 1.8 |
--------------------------------------------------------------------------------
| Gross capital expenditure, 1000 EUR | 4,529 | 4,761 | 20,012 |
--------------------------------------------------------------------------------
| % of net sales | 3.2 | 4.4 | 8.7 |
--------------------------------------------------------------------------------
| R&D expenditures, 1000 EUR | 2,681 | 2,389 | 4,906 |
--------------------------------------------------------------------------------
| % of net sales | 1.9 | 2.2 | 2.1 |
--------------------------------------------------------------------------------
| Personnel average | 4,816 | 3,591 | 4,013 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| GROUP PER-SHARE KEY FIGURES | 1-6/07 | 1-6/06 | 1-12/06 |
| | 6 | 6 | 1 |
| | mon. | mon. | 2 mon. |
--------------------------------------------------------------------------------
| Earnings per share (EPS), EUR | 0.55 | 0.56 | 0.88 |
--------------------------------------------------------------------------------
| Earnings per share (EPS),diluted, EUR | 0.55 | 0.55 | 0.87 |
--------------------------------------------------------------------------------
| Equity per share, EUR | 4.18 | 3.75 | 4.04 |
--------------------------------------------------------------------------------
| Share price at close of period, EUR | 10.59 | 12.95 | 12.25 |
--------------------------------------------------------------------------------
| Lowest share price, EUR | 9.17 | 10.60 | 10.02 |
--------------------------------------------------------------------------------
| Highest share price, EUR | 12.40 | 14.08 | 14.08 |
--------------------------------------------------------------------------------
| Average share price, EUR | 10.65 | 12.04 | 11.69 |
--------------------------------------------------------------------------------
| Turnover in shares, 1000 shares | 10,571 | 6,412 | 11,403 |
--------------------------------------------------------------------------------
| Turnover in shares per (share issue | 59.4 | 36.2 | 64.2 |
| adjusted) share capital, % | | | |
--------------------------------------------------------------------------------
| Average number of shares, 1000 shares | 17,782 | 17,731 | 17,756 |
--------------------------------------------------------------------------------
| Average number of shares, diluted, 1000 | 17,768 | 17,893 | 17,774 |
| shares | | | |
--------------------------------------------------------------------------------
| Shares at end of period, 1000 shares | 17,782 | 17,782 | 17,782 |
--------------------------------------------------------------------------------
| Market capitalisation , 1000 EUR | 188,306 | 230,271 | 217,824 |
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| 1. SEGMENT INFORMATION | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| NET SALES BY BUSINESS | 4-6/07 | 4-6/06 | 1-6/07 | 1-6/06 | 1-12/06 |
| SEGMENTS | 3 | 3 mon. | 6 | 6 | 12 mon. |
| | mon. | | mon. | mon. | |
--------------------------------------------------------------------------------
| Wiring Harnesses, 1000 | 59,811 | 42,924 | 117,943 | 86,375 | 182,161 |
| EUR | | | | | |
--------------------------------------------------------------------------------
| Net sales to other | -45 | -145 | -56 | -179 | -155 |
| segments, 1000 EUR | | | | | |
--------------------------------------------------------------------------------
| Wiring Harnesses, total, | 59,765 | 42,779 | 117,886 | 86,196 | 182,006 |
| 1000 EUR | | | | | |
--------------------------------------------------------------------------------
| Wiring Harnesses, % of | 81.1 | 78.0 | 82.1 | 78.8 | 79.5 |
| net sales | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Electronics, 1000 EUR | 14,119 | 12,390 | 26,138 | 23,656 | 48,034 |
--------------------------------------------------------------------------------
| Net sales to other | -214 | -356 | -387 | -511 | -1,112 |
| segments, 1000 EUR | | | | | |
--------------------------------------------------------------------------------
| Electronics, total, 1000 | 13,905 | 12,035 | 25,751 | 23,145 | 46,922 |
| EUR | | | | | |
--------------------------------------------------------------------------------
| Electronics, % of net | 18.9 | 22.0 | 17.9 | 21.2 | 20.5 |
| sales | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Group Total | 73,670 | 54,813 | 143,637 | 109,341 | 228,928 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| OPERATING PROFIT BY | | | | | |
| BUSINESS SEGMENTS | | | | | |
--------------------------------------------------------------------------------
| Wiring Harnesses, 1000 | 5,570 | 5,081 | 10,510 | 11,765 | 17,899 |
| EUR | | | | | |
--------------------------------------------------------------------------------
| Wiring Harnesses, % of | 9.3 | 11.8 | 8.9 | 13.6 | 9.8 |
| net sales | | | | | |
--------------------------------------------------------------------------------
| Electronics, 1000 EUR | 1,769 | 1,757 | 3,302 | 3,256 | 6,350 |
--------------------------------------------------------------------------------
| Electronics, % of net | 12.5 | 14.2 | 12.6 | 13.8 | 13.2 |
| sales | | | | | |
--------------------------------------------------------------------------------
| Group Total | 7,339 | 6,838 | 13,812 | 15,021 | 24,249 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| NET SALES BY | 4-6/07 | 4-6/06 | 1-12/06 | 1-6/06 | 1-12/06 |
| GEOGRAPHICAL SEGMENTS | 3 | 3 mon. | 12 mon. | 6 | 12 mon. |
| (1000 EUR) | mon. | | | mon. | |
--------------------------------------------------------------------------------
| Finland | 13,885 | 12,720 | 26,372 | 24,420 | 47,824 |
--------------------------------------------------------------------------------
| Other Europe | 39,679 | 31,921 | 79,484 | 64,249 | 128,484 |
--------------------------------------------------------------------------------
| North America | 8,257 | 1,377 | 16,404 | 3,169 | 16,534 |
--------------------------------------------------------------------------------
| South America | 9,508 | 7,297 | 17,312 | 14,372 | 29,149 |
--------------------------------------------------------------------------------
| Other Countries | 2,341 | 1,497 | 4,065 | 3,130 | 6,937 |
--------------------------------------------------------------------------------
| Total | 73,670 | 54,813 | 143,637 | 109,341 | 228,928 |
--------------------------------------------------------------------------------
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| 2. RECONCILIATION OF EQUITY (MILLION EUR) |
--------------------------------------------------------------------------------
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| A = Share Capital |
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| B = Share premium account |
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| C = Fair value and other reserves |
--------------------------------------------------------------------------------
| D = Retained earnings |
--------------------------------------------------------------------------------
| E = Minority interest |
--------------------------------------------------------------------------------
| F = Total equity |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | A | B | C | D | E | F |
--------------------------------------------------------------------------------
| Shareholders' equity | 6.0 | 4.5 | 0.3 | 53.8 | 0.6 | 65.0 |
| 1.1.2006 | | | | | | |
--------------------------------------------------------------------------------
| Profit for the period | 0 | 0 | 0 | 9.9 | 0.1 | 10.0 |
--------------------------------------------------------------------------------
| Dividends | 0 | 0 | 0 | -8.0 | 0 | -8.1 |
--------------------------------------------------------------------------------
| Share options used | 0 | 0.4 | 0 | 0 | 0 | 0.4 |
--------------------------------------------------------------------------------
| Other changes | 0 | 0 | -0.1 | 0 | 0 | -0.1 |
--------------------------------------------------------------------------------
| Shareholders' equity | 6.0 | 4.9 | 0.2 | 55.7 | 0.6 | 67.3 |
| 30.6.2006 | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Shareholders' equity | 6.0 | 4.9 | 0.2 | 60.9 | 0.6 | 72.5 |
| 1.1.2007 | | | | | | |
--------------------------------------------------------------------------------
| Profit for the period | 0 | 0 | 0 | 9.7 | 0.1 | 9.8 |
--------------------------------------------------------------------------------
| Dividends | 0 | 0 | 0 | -8.0 | 0 | -8.0 |
--------------------------------------------------------------------------------
| Share-based payments | 0 | 0 | 0 | 0.2 | 0 | 0.2 |
--------------------------------------------------------------------------------
| Translation differences | 0 | 0 | 0 | 0.5 | 0 | 0.5 |
--------------------------------------------------------------------------------
| Other changes | 0 | 0 | 0.1 | -0.1 | 0 | 0.0 |
--------------------------------------------------------------------------------
| Shareholders' equity | 6.0 | 4.9 | 0.3 | 63.2 | 0.7 | 75.1 |
| 30.6.2007 | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 3. GROUP CONTINGENT LIABILITIES AT | 6/07 | 6/06 | 12/06 |
| END OF PERIOD (1000 EUR) | | | |
--------------------------------------------------------------------------------
| Leasing liabilities | 6,901 | 6,668 | 6,911 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Liabilities for derivate | | |
--------------------------------------------------------------------------------
| instruments 1000 EUR | | | |
--------------------------------------------------------------------------------
| Nominal values | | | |
--------------------------------------------------------------------------------
| Currency derivates | | | |
--------------------------------------------------------------------------------
| Forward contracts | 6,258 | 4,632 | 5,917 |
--------------------------------------------------------------------------------
| Option agreements | | | |
--------------------------------------------------------------------------------
| Call | 0 | 0 | 0 |
--------------------------------------------------------------------------------
| Put | 0 | 0 | 0 |
--------------------------------------------------------------------------------
| Total | 6,258 | 4,632 | 5,917 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Fair values | | | |
--------------------------------------------------------------------------------
| Currency derivates | | | |
--------------------------------------------------------------------------------
| Forward contracts | -74 | -120 | -38 |
--------------------------------------------------------------------------------
| Option agreements | | | |
--------------------------------------------------------------------------------
| Call | 0 | 0 | 0 |
--------------------------------------------------------------------------------
| Put | 0 | 0 | 0 |
--------------------------------------------------------------------------------
| Total | -74 | -120 | -38 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Currency derivates are used only in hedging currency risks. PKC Group does not
apply hedge accounting to derivate instruments in accordance with IAS 39. Fair
values of the derivates are entered directly in the income statement.
--------------------------------------------------------------------------------
| 4. QUARTERLY | 1-3/06 | 4-6/06 | 7-9/06 | 10-12/06 | 1-3/07 | 4-6/07 |
| KEY FIGURES | 3 | 3 mon. | 3 | 3 mon. | 3 mon. | 3 mon. |
| | mon. | | mon. | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| CONSOLIDATED | | | | | | |
--------------------------------------------------------------------------------
| Net sales, | 54,527 | 54,813 | 53,994 | 65,594 | 69,967 | 73,670 |
| 1000 EUR | | | | | | |
--------------------------------------------------------------------------------
| Operating | 8,183 | 6,838 | 5,316 | 3,912 | 6,473 | 7,339 |
| profit, 1000 | | | | | | |
| EUR | | | | | | |
--------------------------------------------------------------------------------
| % of net | 15.0 | 12.5 | 9.8 | 6.0 | 9.3 | 10.0 |
| sales | | | | | | |
--------------------------------------------------------------------------------
| Profit before | 8,372 | 6,202 | 5,174 | 3,003 | 6,093 | 7,146 |
| taxes, 1000 | | | | | | |
| EUR | | | | | | |
--------------------------------------------------------------------------------
| % of net | 15.4 | 11.3 | 9.6 | 4.6 | 8.7 | 9.7 |
| sales | | | | | | |
--------------------------------------------------------------------------------
| Equity ratio, | 50.7 | 56.0 | 49.3 | 48.0 | 44.2 | 45.9 |
| % | | | | | | |
--------------------------------------------------------------------------------
| Earnings per | | | | | | |
| share (EPS), | | | | | | |
--------------------------------------------------------------------------------
| diluted, EUR | 0.33 | 0.22 | 0.21 | 0.11 | 0.24 | 0.30 |
--------------------------------------------------------------------------------
| Shareholders | | | | | | |
| equity | | | | | | |
--------------------------------------------------------------------------------
| per share, | 3.51 | 3.75 | 3.96 | 4.04 | 3.84 | 4.18 |
| EUR | | | | | | |
--------------------------------------------------------------------------------
| WIRING | | | | | | |
| HARNESSESS | | | | | | |
--------------------------------------------------------------------------------
| Net sales, | 43,417 | 42,779 | 42,163 | 53,647 | 58,121 | 59,765 |
| 1000 EUR | | | | | | |
--------------------------------------------------------------------------------
| Operating | 6,684 | 5,081 | 3,342 | 2,792 | 4,940 | 5,570 |
| profit, 1000 | | | | | | |
| EUR | | | | | | |
--------------------------------------------------------------------------------
| % of net | 15.4 | 11.8 | 7.9 | 5.2 | 8.5 | 9.3 |
| sales | | | | | | |
--------------------------------------------------------------------------------
| ELECTRONICS | | | | | | |
--------------------------------------------------------------------------------
| Net sales, | 11,110 | 12,035 | 11,831 | 11,946 | 11,846 | 13,905 |
| 1000 EUR | | | | | | |
--------------------------------------------------------------------------------
| Operating | 1,499 | 1,757 | 1,975 | 1,120 | 1,533 | 1,769 |
| profit, 1000 | | | | | | |
| EUR | | | | | | |
--------------------------------------------------------------------------------
| % of net | 13.3 | 14.2 | 16.7 | 9.4 | 12.8 | 12.5 |
| sales | | | | | | |
--------------------------------------------------------------------------------
CALCULATION OF INDICATORS
Return on equity (ROE), %
= 100 x (Profit before extraordinary items - taxes) / Shareholders equity +
minority interest (average)
Return on investments (ROI), %
= 100 x (Profit before extraordinary items + interest and other financial
expenses) / Balance sheet total - interest free liabilities (average)
Gearing, %
= 100 x (Interest-bearing liabilities - cash in hand and at banks and
investments) / Shareholders equity + minority interest
Equity ratio, %
= 100 x (Shareholders equity + minority interest) / Balance sheet total -
advance payments received
Quick ratio
Receivables and cash in hand and at banks / Current creditors - advance payments
received
Current ratio
Receivables and cash in hand and at banks + inventories /Current creditors
Earnings per share (EPS), EUR
Profit before extraordinary items - income taxes +/- minority interest / Average
share issue-adjusted number of shares
Shareholders' equity per share, EUR
Shareholders equity / Share issue-adjusted number of shares on the date of the
financial statement
Market capitalisation
Number of shares at the end of financial period x the last trading price of the
financial period
The information presented in this Interim Report has not been audited. The
interim report has been prepared according to IFRS standards.
All the forward-looking estimates and forecasts presented in this press release
are based on the current views of the Company's management. Estimates and
forecasts involve risks and factors of uncertainty, which, should they
materialise, can lead to results that differ from present estimates. The main
factors of uncertainty are related, among other things, to the general economic
situation, the trend in the operating environment and sector as well as the
success of the Group's strategy.
PKC Group Oyj
Board of Directors
Mika Kari
President & CEO
For additional information, contact:
Mika Kari, President & CEO, PKC Group Oyj, +358 20 1752 350
Sami Klemola, CFO, PKC Group Oyj, +358 20 1752 362
PRESS CONFERENCE
A press conference on the quarterly report will be arranged for analysts and
investors today, 13 July 2007, at 1.00 pm at the address Graniittitalo Meeting
Centre, meeting rooms Safiiri and Rubiini, Jaakonkatu 3, 2. floor, 00100
HELSINKI.
DISTRIBUTION
Helsinki Stock Exchange
Main media
www.pkcgroup.com
The PKC Group offers design and contract manufacturing services for wiring
harnesses, cabling and electronics. The Group has production facilities in
Finland, Brazil, China, Mexico, Estonia and Russia, and it employs about 4,800
people. The Group had net sales in 2006 of EUR 229 million. PKC Group Oyj is
listed on the Helsinki Stock Exchange.
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