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2009-02-12 08:00:00 CET 2009-02-12 08:00:01 CET REGULATED INFORMATION Martela Oyj - Financial Statement ReleaseMARTELA CORPORATION'S FINANCIAL STATEMENTS RELEASE, 1 JANUARY - 31 DECEMBER 2008MARTELA CORPORATION STOCK EXCHANGE RELEASE 12.2.2009 at 09.00 a.m. MARTELA CORPORATION'S FINANCIAL STATEMENTS RELEASE, 1 JANUARY - 31 DECEMBER 2008 Consolidated revenue for January-December was EUR 141.2 million, an increase of 9.9 per cent on the previous year's figure (EUR 128.4 million). Operating profit was EUR 10.9 million (8.3), including EUR 0.7 million (2.5) in gains from the sale of assets. The equity ratio was 52.2 per cent (46.7) and gearing was -11.0 per cent (16.0). Key figures -------------------------------------------------------------------------------- | | 10-12 | 10-12 | 1-12 | 1-12 | -------------------------------------------------------------------------------- | EUR million | 2008 | 2007 | 2008 | 2007 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Net revenue | 41.1 | 37.0 | 141.2 | 128.4 | -------------------------------------------------------------------------------- | Change in revenue % | 11.0 | 0.4 | 9.9 | 7.3 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Operating profit excluding | 3.8 | 2.6 | 10.2 | 5.8 | | non-recurring items | | | | | -------------------------------------------------------------------------------- | Operating profit % | 9.3 | 7.0 | 7.2 | 4.5 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Return on investment, % | | | 25.2 | 19.6 | -------------------------------------------------------------------------------- | Return on equity, % | | | 23.8 | 19.8 | -------------------------------------------------------------------------------- | Equity to asset ratio, % | | | 52.2 | 46.7 | -------------------------------------------------------------------------------- | Gearing, % | | | -11.0 | 16.0 | -------------------------------------------------------------------------------- | Earnings per share, eur | 1.89 | 1.32 | -------------------------------------------------------------------------------- | Earnings per share (diluted), eur | 1.89 | 1.32 | | | | | -------------------------------------------------------------------------------- | Average staff | | | 681 | 663 | -------------------------------------------------------------------------------- | Revenue/employee (EUR 1.000) | | | 207.3 | 193.7 | -------------------------------------------------------------------------------- Accounting policies Martela Corporation's consolidated financial statements have been prepared in compliance with the International Financial Reporting Standards (IFRS). The IAS and IFRS standards and SIC and IFRIC interpretations valid on 31 December 2008 have been applied in the preparation of the financial statements. Market situation The demand for office furniture continued to be good during the year. There were fewer new starts in office construction in 2008 than in the previous year, and also fewer building permits were granted. Group structure There were no changes in Group structure during 2008, and this was also the case in 2007. Segment reporting Martela has a single primary segment, namely the furnishing of offices and public spaces. The revenue and result are as recorded in the consolidated financial statements. The Group's secondary reporting segment is its customers by geographical location. Revenue Revenue for January-December rose to EUR 141.2 million (128.4), a year-on-year increase of 9.9 per cent. Significant contributors to this revenue growth were the various major projects carried out during the year. Revenue for the fourth quarter increased to EUR 41.1 million (37.0), up 11.0 per cent. Revenue growth was particularly strong in the Finnish market. The revenue trend in Scandinavia was not according to plan in 2008, decreasing by 19.7 per cent on the previous year's figure. Invoicing by main market area -------------------------------------------------------------------------------- | | 10-12 | 10-12 | 1-12 | 1-12 | -------------------------------------------------------------------------------- | EUR million | 2008 | 2007 | 2008 | 2007 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Finland | 32.2 | 24.8 | 104.1 | 85.8 | -------------------------------------------------------------------------------- | Scandinavia | 5.3 | 7.2 | 20.6 | 26.4 | -------------------------------------------------------------------------------- | Poland and surrounding areas | 2.8 | 3.8 | 12.3 | 11.1 | -------------------------------------------------------------------------------- | Other areas | 1.8 | 1.3 | 5.2 | 5.4 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Total | 42.1 | 37.1 | 142.2 | 128.7 | -------------------------------------------------------------------------------- Change in invoicing and percentage of consolidated invoicing -------------------------------------------------------------------------------- | | 1-12 | 1-12 | | | -------------------------------------------------------------------------------- | EUR million | 2008 | 2007 | Change | Percentage | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Finland | 104.1 | 85.8 | 21.3 | 73.2 | -------------------------------------------------------------------------------- | Scandinavia | 20.6 | 26.4 | -21.9 | 14.5 | -------------------------------------------------------------------------------- | Poland and surrounding | 12.3 | 11.1 | 10.4 | 8.6 | | areas | | | | | -------------------------------------------------------------------------------- | Other areas | 5.2 | 5.4 | -1.0 | 3.7 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Total | 142.2 | 128.7 | 10.6 | 100.0 % | -------------------------------------------------------------------------------- Consolidated result The consolidated result for the fourth quarter was according to plan, and the operating profit came to EUR 3.8 million (2.6). The full-year result showed a good improvement, and operating profit totalled EUR 10.9 million (8.3). The result includes EUR 0.7 million (2.5) in non-recurring income from the sale of assets. The sales profit made in the first half of the year was from the sale of land in Poland. Operating profit excluding non-recurring items totalled EUR 10.2 million (5.8). Profit development has been positive in Finland and in Poland and its neighbouring areas in 2008. In Scandinavia, the decrease in revenue has adversely affected profit development. Profit before taxes rose to EUR 10.2 million (7.6), and profit after taxes was EUR 7.5 million (5.4). Operating profit excluding non-recurring items was 7.2 per cent of revenue (4.5). Financial standing The Group's financial standing strengthened further. Interest-bearing liabilities at the end of the financial year amounted to EUR 10.9 million (14.4) and net liabilities were EUR -3.7 million (4.7). The gearing ratio at the end of the year was -11.0 per cent (16.0), and the equity ratio was 52.2 per cent (46.7). Net financial expenses were EUR -0.7 million (-0.7). The cash flow from operating activities in January-December was EUR 11.8 million (9.9). During the year, the company decided to launch a project to reduce the amount of working capital, and we expect the project to produce results principally during 2009. The end-of-year balance sheet total was EUR 64.9 million (63.8). Capital expenditure The Group's gross capital expenditure for January-December was EUR 2.9 million (3.2) and mainly concerned production replacements and IT investments. Of the capital expenditure for the comparison period in 2007, EUR 0.7 million was attributable to the ownership rearrangement at the Bodafors plant, as a result of which the long-term lease liability for the part leased back by Martela was activated in the consolidated balance sheet in accordance with the IFRS rules. Personnel The Group employed an average of 681 (663) persons, representing an increase of 2.7 per cent. Average number of personnel by region -------------------------------------------------------------------------------- | | 1-12 | 1-12 | -------------------------------------------------------------------------------- | | 2008 | 2007 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Finland | 520 | 518 | -------------------------------------------------------------------------------- | Scandinavia | 71 | 71 | -------------------------------------------------------------------------------- | Poland | 90 | 74 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Group total | 681 | 663 | -------------------------------------------------------------------------------- Product development and collection Product development and management of the collection are the responsibility of two Group-level organisations: the Office product line, which is responsible for workstation furniture, and the Surroundings product line, which is responsible for surroundings and other public-space furniture. At the Stockholm Furniture Fair in February, Martela exhibited new products representing both product lines, as well as two fascinating new concepts. The exhibited pieces of workstation furniture were the James task chair designed by Iiro Viljanen and the Pinta ES, the newest member of the Pinta range, by Pekka Toivola and Iiro Viljanen. New surroundings furniture displayed for the first time comprised the Skybar chair designed by Geir Sætveit and the Movie sofa by Rane Vaskivuori. The concepts we exhibited at Stockholm were well received. In particular, the Mybox desk designed by Iiro Viljanen and the Pekka Toivola's Book shelf/space divider generated welcome discussion and considerable interest. At the Milan Furniture Fair in April, Martela set up its own exhibition on the theme ‘under THE Tree'. The name is from the space divider The Tree, designed by Professor Eero Aarnio. Shares In January-December, a total of 787,491 (1,159,509) of the company's series A shares were traded on the NASDAQ OMX Helsinki exchange, corresponding to 22.2 per cent (32.7) of the total number of series A shares. The higher trading figure in 2007 was due partly to the acquisition in the first quarter of shares by Evli Alexander Management Oy for the three-year share-based incentive system. A total of 143,166 shares were acquired for EUR 1.2 million. The value of trading was EUR 6.5 million (10.0), and the share price was EUR 8.35 at the beginning and EUR 5.29 at the end of the year. During January-December the share price was EUR 10.05 at its highest and EUR 5.10 at its lowest. At the end of December, equity per share was EUR 8.47 (7.22). On 23 May 2008, Nordea Investment Fund Company Finland Ltd announced that its holding in Martela Corporation fell to 0.57 per cent following a share transaction made on 22 May 2008. Treasury shares Martela did not purchase any of its own shares for the treasury in 2008. On 31 December 2008, Martela owned a total of 67,700 of its own series A shares, purchased at an average price of EUR 10.65. Martela's holding of treasury shares amounts to 1.6 per cent of all shares and 0.4 per cent of all votes. Acquisition of shares for the share reward system and the management of that system have been outsourced to an external service provider, Evli Alexander Management Oy. The shares are the property of Evli Alexander Management Oy until they are transferred to Martela's key personnel under the incentive system. Notwithstanding this legal formality, the shares are presented in the 2008 financial statements under equity, as if Martela had acquired its own shares. In 2007, they were treated as loan receivables from Evli Alexander Management Oy. On 31 December 2008, 104,282 shares under the incentive system were still undistributed. 2008 Annual General Meeting The Annual General Meeting, held on 1 April 2008, adopted the financial statements and discharged those responsible for the accounts from further liability. The AGM decided, in accordance with the Board of Directors' proposal, to distribute a dividend of EUR 0.50 per share, totalling EUR 2,043,950. Heikki Ala-Ilkka, Tapio Hakakari, Heikki Martela, Pekka Martela, Jori Keckman and Jaakko Palsanen were elected as members of the Board of Directors for the next term. KPMG Oy Ab, Authorised Public Accountants, was elected as the company's auditor. The AGM also approved the Board of Directors' proposals, detailed in the meeting notice, for authorising the Board to acquire and/or dispose of the company's own shares. Furthermore, the AGM decided, in accordance with the Board of Directors' proposal, to amend the company's Articles of Association pursuant to the new Limited Liability Companies Act, which entered into force on 1 September 2006. The new Board of Directors convened after the Annual General Meeting and, from among its members, elected Heikki Ala-Ilkka as Chairman and Pekka Martela as Vice Chairman. Post-balance sheet events Martela has begun codetermination talks in order to adjust the parent company's factory and office employee resources in line with the lower level of demand. The reductions would be implemented as temporary lay-offs and redundancies affecting the entire personnel. The number of redundancies is estimated to total about 30 people. The need for lay-offs and redundancies is due to the general economic uncertainty, which has increased significantly. Short-term risks The greatest risk to profit performance is related to the continuation of global economic uncertainty and the consequent overall demand for office furniture. 2009 Annual General Meeting and the Board's proposal for distribution of profit Martela Corporation's AGM will be held on Tuesday, 17 March 2009. The Board of Directors will propose to the General Meeting that the Board be authorised to acquire Martela shares. The Board will also propose that a dividend of EUR 0.60 per share be distributed for 2008. The liquidity is good and, in the Board of Director's view, the proposed distribution of dividend does not pose a risk to the Company's financial standing. The parent company's distributable equity at the end of the 2008 financial year amounts to EUR 37,969,142.88. Shareholders registered in the shareholder register maintained at the Finnish Central Securities Depository on the record date for dividend payment, Friday, 20 March 2009, will be entitled to the dividend as proposed by the Board. The Board will propose that the dividend be paid on Friday, 27 March 2009. The notice of the Annual General Meeting will be published in a separate stock exchange bulletin. Board composition and auditors Shareholders representing a total of over 50 per cent of the company's votes have informed the company that they will be proposing the following current members to be elected to the Board: Heikki Ala-Ilkka, Tapio Hakakari, Jori Keckman, Heikki Martela, Pekka Martela and Jaakko Palsanen. The aforementioned shareholders have also announced that they will propose that KPMG Oy, Authorised Public Accountants, be elected as the company's auditor until the end of the next AGM. Outlook for 2009 The general economic uncertainty has increased significantly and will affect the company's performance in 2009. Revenue will be down on the previous year's figure, and operating profit will also be lower than in 2008. During 2009, the company will re-examine its cost structure and improve the efficiency of its operations. GROUP INCOME STATEMENT (EUR 1000) 2008 2007 2008 2007 1-12 1-12 10-12 10-12 Revenue 141.153 128.445 41.077 36.992 Other operating income 1.422 3.023 0.281 0.068 Employee benefits expenses -31.452 -28.723 -8.382 -7.834 Operating expenses -97.154 -91.236 -28.352 -25.819 Depreciation and impairment -3.115 -3.231 -0.803 -0.825 Operating profit/loss 10.854 8.278 3.822 2.582 % of turnover 7.7 6.4 9.3 7.0 Financial income and expenses -0.651 -0.726 -0.194 -0.181 Profit/loss before taxes 10.202 7.552 3.627 2.401 % of turnover 7.2 5.9 8.8 6.5 Income tax -2.666 -2.165 -0.525 -0.714 Profit/loss for the period 7.537 5.387 3.102 1.686 % of turnover 5.3 4.2 7.6 4.6 Basic earnings per share, eur 1.89 1.32 0.78 0.41 Diluted earnings per share, eur 1.89 1.32 0.78 0.41 GROUP BALANCE SHEET (EUR 1000) 31.12.2008 31.12.2007 ASSETS Non-current assets Intangible assets 0.724 0.633 Tangible assets 13.461 14.151 Investments 0.039 0.053 Deferred tax assets 0.304 0.240 Pension receivables 0.072 0.035 Receivables 0.000 0.623 Investment properties 0.600 1.203 Total 15.200 16.938 Current assets Inventories 10.825 13.635 Receivables 24.252 23.536 Financial assets at fair value through profit and loss 1.038 2.004 Cash and cash equivalents 13.581 7.686 Total 49.696 46.861 Total assets 64.896 63.800 EQUITY AND LIABILITIES Equity attributable to equity holders of the parent Share capital 7.000 7.000 Share premium account 1.116 1.116 Other reserves 0.117 0.117 Translation differences -0.486 -0.129 Retained earnings 27.335 22.060 Treasury shares -1.610 -0.721 Share-based incentives 0.270 0.067 Total 33.742 29.510 Non-current liabilities Interest-bearing liabilities 8.024 10.453 Deferred tax liability 1.403 1.553 Total 9.427 12.006 Current liabilities Interest-bearing 2.869 3.969 Non-interest bearing 18.858 18.315 Total 21.727 22.284 Total liabilities 31.154 34.290 Equity and liabilities, total 64.896 63.800 STATEMENT OF CHANGES IN EQUITY (EUR 1000) Share Share Other Trans. Retained Treasury Total capital premium reserves diff. earnings shares account and share- based inc. 01.01.2007 7.000 1.116 0.117 -0.129 17.542 -0.721 24.925 Translation diff. 0.000 Profit/loss for the period 5.387 5.387 Other change 0.220 0.220 Total recognized income and expense for the fin.year 5.607 5.607 Dividends -1.022 -1.022 31.12.2007 7.000 1.116 0.117 -0.129 22.127 -0.721 29.510 1.1.2008 7.000 1.116 0.117 -0.129 22.127 -0.721 29.510 Translation diff. -0.357 -0.357 Profit/loss for the period 7.537 7.537 Other change -0.122 -0.889 -1.011 Total recognized income and expense for the fin.year -0.357 7.415 -0.889 6.169 Dividends -1.937 -1.937 31.12.2008 7.000 1.116 0.117 -0.486 27.605 -1.610 33.742 CONSOLIDATED CASH FLOW STATEMENT (EUR 1000) 2008 2007 1-12 1-12 Cash flows from operating activities Cash flow from sales 138.477 130.834 Cash flow from other operating income 0.687 0.550 Payments on operating costs -124.654 -121.090 Net cash from operating activities before financial items and taxes 14.510 10.294 Interest paid -0.844 -0.842 Interest received 0.268 0.082 Other financial items -0.060 -0.021 Dividends received 0.000 0.001 Taxes paid -2.116 0.381 Net cash from operating activities (A) 11.758 9.895 Cash flows from investing activities Capital expenditure on tangible and intangible assets -2.206 -2.256 Proceeds from sale of tangible and intangible assets 1.489 2.028 Proceeds from sale of shares in subsidiaries 0.000 2.150 Loans granted 0.000 -1.193 Repayments of loans receivables 0.022 0.011 Net cash used in investing activities (B) -0.694 0.740 Cash flows from financing activities Proceeds from short-term loans 0.129 0.976 Repayments of short-term loans -0.795 -1.704 Repayments of long-term loans -3.365 -3.108 Dividends -1.972 -1.022 Net cash used in financing activities (C) -6.003 -4.858 Change in cash and cash equivalents (A+B+C) 5.061 5.778 (+ increase, - decrease) Cash and cash equivalents at the beginning of period 9.691 3.911 Translation differences -0.132 0.002 Cash and cash equivalents at the end of period 14.620 9.691 KEY FIGURES/RATIOS 2008 2007 1-12 1-12 Revenue EUR million 141.2 128.4 Change in revenue, % 9.9 7.3 Exports and international operations, 38.1 42.8 EUR million In relation to revenue, % 27.0 33.3 Gross capital expenditure on fixed 2.9 3.2 assets, EUR million In relation to revenue, % 2.1 2.5 Research and development expenses, 3.2 3.1 EUR million In relation to revenue, % 2.3 2.4 Average personnel 681 663 Change in personnel, % 2.7 5.9 Personnel at year end 670 655 Turnover / employee, EUR thousand 207.3 193.7 Return on equity, % 23.8 19.8 Return on investment, % 25.2 19.6 Equity ratio, % 52.2 46.7 Interest-bearing net-debt, EUR million -3.7 4.7 Gearing ratio, % -11.0 16.0 Key share-related figures Number of shares, at the end of period (1000) 4155.6 4155.6 Basic earnings per share, EUR 1.89 1.32 Diluted earnings per share, EUR 1.89 1.32 Price/earnings ratio (PE) 2.8 6.3 Equity per share, EUR 8.47 7.22 Dividend/share, EUR 0.60* 0.50 Dividend/earnings, % 31.7 37.9 Effective dividend yield, % 11.3 6.0 Price of A-share 31.12. EUR 5.29 8.35 *) Proposal of the Board of Directors The largest shareholders, 31.12.2008 No.of shares % of total (A+K-series) votes Marfort Oy 524 574 38.8 Ilmarinen Mutual Pension Insurance Company 335 400 2.1 OP Suomi Arvo 273 700 1.7 Odin Finland 218 400 1.4 Fondita Nordic Micro Cap Placeringsf 205 000 1.3 Palsanen Leena 199 634 9.6 FIM Fenno Mutual Fund 188 897 1.2 Martela Heikki 163 450 7.4 Pohjola P & C Insurance company 160 294 1.0 Martela Matti 115 238 7.8 Suomen Argentor Oy 112 735 0.7 Oy Autocarrera Ab 111 820 0.7 Evli Alexander Management Oy 104 282 0.7 Lindholm Tuija 86 954 5.8 Palsanen Jaakko 85 468 0.7 Martela Pekka 69 282 8.9 Other shareholders 1 200 472 10.1 Total 4 155 600 100.0 The number of registered Martela Oyj shares on 31.12.2008 was 4.155,600. The shares are divided into A and K shares. Each A share carries 1 vote and each K share 20 votes in a general shareholders' meeting. The company's board of directors and CEO together hold 8.6% of the shares and 17.2% of the votes. Segments 2008 (EUR 1,000) Geographical segments Finland Scandinavia Other Elim. Unalloc. Total areas Turnover 103.161 20.501 17.491 141.153 Segment assets 58.290 5.784 4.779 -6.215 2.258 64.896 Capital expenditure 2.506 0.161 0.258 2.925 2007 (EUR 1,000) Geographical segments Finland Scandinavia Other Elim. Unalloc. Total areas Turnover 85.503 26.551 16.391 128.445 Segment assets 52.337 8.197 6.791 -8.197 4.672 63.800 Capital expenditure 2.088 0.843 0.317 3.248 CONTINGENT LIABILITIES 31.12.2008 31.12.2007 Mortgages and shares pledged 14.566 18.851 Guarantees - - Other commitments 0.332 0.317 Rental commitments 8.964 10.674 DEVELOPMENT OF SHARE PRICE 2008 2007 1-12 1-12 Share price at the end of period, EUR 5.29 8.35 Highest price, EUR 10.05 10.35 Lowest price, EUR 5.10 6.39 Average price, EUR 8.30 6.64 Annual Report 2008 will be published on Martela's homepages during the week 10. The first Interim Report for the period January 1 - March 31, 2009 will be published on April 29, 2009. Helsinki, 11 February 2009 Martela Corporation Board of Directors Heikki Martela CEO Additional information Heikki Martela, CEO, tel. +358 50 502 4711 Mats Danielsson, Finance Director, tel. +358 50 394 8575 Distribution NASDAQ OMX Nordic Main news media www.martela.com |
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