2014-07-30 07:00:00 CEST
2014-07-30 07:00:03 CEST
REGULATED INFORMATION
Lemminkäinen - Interim report (Q1 and Q3)
Lemminkäinen Interim Report 1 Jan–30 June 2014: The result improved year-on-year
LEMMINKÄINEN CORPORATION INTERIM REPORT 30 JULY 2014 AT 8:00 A.M.
LEMMINKÄINEN INTERIM REPORT 1 JAN-30 JUNE 2014:
THE RESULT IMPROVED YEAR-ON-YEAR
January-June 2014 (1-6/2013)
-- Net sales totalled EUR 789.8 million (736.0).
-- At the end of the review period, the order book stood at EUR 2,086.8
million (1,973.5).
-- Operating profit was EUR -2.5 million (-48.8), or -0.3% (-6.6) of net
sales.
-- Earnings per share were EUR 0.21 (-2.63).
-- Cash flow from operations totalled EUR -126.9 million (-78.2).
-- The equity ratio stood at 32.1% (29.2) and gearing at 85.4% (108.6).
-- On 13 June 2014, Lemminkäinen divested its technical building services
business to Are Group. The debt free purchase price was EUR 60.0 million.
From the sale, Lemminkäinen booked EUR 23.7 million in capital gain in the
second quarter of the year. The technical building services impact on
financial performance and the capital gain from the sale have been eliminated from the income statement from continuing operations, as it's
classified as discontinued operations.
April-June 2014 (4-6/2013)
-- Net sales totalled EUR 510.5 million (470.8).
-- Operating profit was EUR 14.8 million (-11.9), or 2.9% (-2.5) of net sales.
-- Earnings per share were EUR 1.30 (-0.91).
-- Cash flow from operations totalled EUR -24.8 million (-53.8).
Profit guidance for 2014
Lemminkäinen estimates that its 2014 net sales will be slightly lower than in
2013 but its operating profit will improve clearly on 2013 (excluding
non-recurring items). In 2013, net sales were EUR 2,020.1 million and operating
profit excluding non-recurring items was EUR -3.9 million. The profit guidance
remains unchanged for continuing operations. The impact of Technical building
services has been eliminated from the 2013 figures.
Key figures, IFRS 4-6/ 4-6/ Change 1-6/ 1-6/ Change 1-12/
2014 2013 2014 2013 2013
Net sales M€ 510.5 470.8 39.7 789.8 736.0 53.8 2,020.1
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Operating profit, M€ 14.8 -11.9 26.7 -2.5 -48.8 46.3 -3.9
excluding
non-recurring items
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% net sales % 2.9 -2.5 -0.3 -6.6 -0.2
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Operating profit M€ 14.8 -11.9 26.7 -2.5 -48.8 46.3 -89.31)
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Pre-tax profit M€ 7.3 -18.7 26.0 -17.1 -60.5 43.4 -116.11)
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Profit from M€ 5.3 -16.2 21.5 -14.9 -47.4 32.5 -96.21)
continuing
operations
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Profit from M€ 22.9 -0.4 23.3 23.2 -1.5 24.7 2.7
discontinued
operations
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Profit for the period M€ 28.2 -16.7 44.9 8.3 -48.9 57.2 -93.51)
--------------------------------------------------------------------------------
Earnings per share € 0.14 -0.89 1.03 -0.97 -2.55 1.58 -5.19
from continuing
operations
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Earnings per share € 1.17 -0.02 1.19 1.18 -0.08 1.26 0.14
from discontinued
operations
--------------------------------------------------------------------------------
Earnings per share € 1.30 -0.91 2.21 0.21 -2.63 2.84 -5.062)
for the period
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Cash flow from M€ -24.8 -53.8 -126.9 -78.2 8.3
operations
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1) Includes non-recurring items: The District Court's decision on damages
related to the asphalt cartel, EUR 65.6 million, and write-downs mainly related
to commercial properties, EUR 19,8 million
2) Includes non-recurring items: The District Court's decision on damages
related to the asphalt cartel, EUR -3.35 per share, and write-downs mainly
related to commercial properties, EUR -1.01 per share
Key figures, IFRS 30 June 30 June Change 31 December
2014 2013 2013
Order book, continuing M€ 2,086.8 1,973.5 113.3 1,733.2
operations
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Balance sheet total M€ 1,463.4 1,461.8 1.6 1,342.7
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Interest-bearing net debt M€ 339.9 405.2 -65.3 326.5
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Equity ratio % 32.1 29.2 27.3
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Gearing % 85.4 108.6 100.8
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Return on investment, rolling % 0.2 5.7 -9.4
12 months
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President and CEO's view"During the second quarter of 2014 Lemminkäinen took major steps in its
turnaround. I am pleased to note that we achieved significant improvement in
profitability compared to the first half of the year 2013," says Berndt Brunow,
Chairman of Lemminkäinen's Board of Directors and Lemminkäinen's interim
President and CEO. "Much of the improvement was due to our cost-cutting and
efficiency improvement measures, successful infrastructure construction
projects in Finland, paving business and building construction in the Helsinki
metropolitan area.""Our balance sheet is currently stronger than in the beginning of the year. We
issued a 100-million-euro domestic bond in June which extended the maturity
distribution of our debt portfolio. We also divested our technical building
services business to Are Group in June. To further build our financial
strength, we will continue to divest non-core operations and assets. We have
also initiated a programme to release working capital.""Our strategic focus is on infrastructure construction in Northern Europe and
building construction in selected customer segments and areas in Finland and
Russia. To enable future profitable growth in these businesses, we continue to
take decisive actions to strengthen our balance sheet and improve our
competitiveness. In building construction, we do not expect help from the
market: In Russia the economic and political situation is uncertain, though it
has not yet affected our apartment sales in St Petersburg. In Finland, the
sales times are lengthening in residential construction.""Unfortunately we have had to make many difficult decisions to initiate the
turnaround, including the decision to reduce our personnel by nearly 500. Going
forward, we need disciplined implementation of the decisions now taken and
innovative approach for Lemminkäinen's further renewal. Our new CEO Casimir
Lindholm, as of August, and his Executive Team have a clear management agenda
to build a firm foundation for Lemminkäinen's future success."
Market outlook
Construction of new apartments will decrease for the third year in a row in
Finland measured in value. Building construction will mainly be increased
through renovation and somewhat by construction of public premises and
industrial and warehouse premises. The weak economic situation of the public
sector will most likely lower the demand for paving and road maintenance. On
the other hand, the market situation in infrastructure construction will be
supported by current and future major projects. In Scandinavia, the demand for
infrastructure construction will be increased by multi-year national investment
programmes as well as needs for renewing energy production. At the same time,
the growing infrastructure market attracts Central European construction
companies to these countries, which intensifies price competition in the
industry. The growth outlook of the Russian economy will remain uncertain, and
forecasting the operating environment has become more difficult.
Briefing
A Finnish-language briefing for analysts and the media will be held at 10:00
A.M. on Wednesday, 30 July at Lemminkäinen's head office. The street address is
Salmisaarenaukio 2, Helsinki, Finland. Lemminkäinen's Chairman of the Board and
interim President and CEO Berndt Brunow will present the Interim Report.
Presentation materials can be found in Finnish and English at the company's
website, www.lemminkainen.com.
Financial Reports for 2014
7 February 2014: Financial Statements Bulletin 2013
30 April 2014: Interim Report, 1 Jan-31 March 2014
30 July 2014: Interim Report, 1 Jan-30 Jun 2014
29 October 2014: Interim Report, 1 Jan-30 Sept 2014
LEMMINKÄINEN CORPORATION
Corporate Communications
ADDITIONAL INFORMATION:
Media:
Berndt Brunow, Chairman of the Board of Directors and interim President and
CEO, tel. +358 2071 54524
Investors and analysts:
Ilkka Salonen, CFO, tel. +358 2071 50246
Katri Sundström, Head of Investor Relations, tel. +358 2071 54813
DISTRIBUTION:
NASDAQ OMX Helsinki
Key media
www.lemminkainen.com
ATTACHMENT: Interim Report Q2/2014
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