2014-07-18 07:30:00 CEST
2014-07-18 07:30:05 CEST
REGULATED INFORMATION
Suominen Oyj - Interim report (Q1 and Q3)
Suominen Corporation's Interim Report for January 1 - June 30, 2014: Suominen sets focus on nonwovens; operating profit excluding non-recurring items improved 27%
Helsinki, Finland, 2014-07-18 07:30 CEST (GLOBE NEWSWIRE) -- Suominen
Corporation Interim Report 18 July 2014 at 8:30am (EEST)
SUOMINEN CORPORATION'S INTERIM REPORT FOR JANUARY 1 - JUNE 30, 2014:
SUOMINEN SETS FOCUS ON NONWOVENS; OPERATING PROFIT EXCLUDING NON-RECURRING
ITEMS IMPROVED BY 27%
KEY FIGURES Q2/ Q2/ Q1-Q2/ Q1-Q2/ Q1-Q4/
2014 2013 2014 2013 2013
--------------------------------------------------------------------------------
Net sales, EUR million 95.3 93.1 193.7 190.4 373.7
Operating profit before 5.5 4.6 11.9 9.4 19.4
non-recurring items, EUR million
Operating profit, EUR million 5.2 4.6 11.4 9.4 18.9
Profit/loss for the period, 2.2 1.0 4.8 2.5 5.7
EUR million, continuing operations
Profit/loss for the period, EUR million, -4.0 -17.6 -3.7 -17.9 -21.8
discontinued operations
Profit/loss for the period, -1.8 -16.6 1.1 -15.5 -16.1
EUR million, total
Earnings/share, EUR, 0.01 0.00 0.02 0.01 0.02
continuing operations
Earnings/share, EUR, -0.02 -0.07 -0.02 -0.07 -0.09
discontinued operations
Earnings/share, EUR, Group -0.01 -0.07 0.00 -0.06 -0.07
Cash flow from operations/share, 0.05 0.01 0.04 0.00 0.09
EUR*
Return on invested capital (ROI), % * 8.4 -4.4 8.4 -4.4 -0.7
Return on invested capital (ROI), %, 13.2 9.3 13.2 9.3 12.4
continuing operations
Gearing, % ** 71.4 121.4 71.4 121.4 96.2
* Including discontinued operations.
All figures in this interim report refer to continuing operations of the Group
unless otherwise stated. The figures are compared with those of the
corresponding period in 2013 unless otherwise stated. In accordance with IFRS
5, the comparison data of the balance sheets have not been revised and,
consequently, include discontinued operations.
Highlights in April - June 2014:
- Net sales increased by 2.4% and amounted to EUR 95.3 million (93.1).
- Operating profit excluding non-recurring items increased by 19.1% to EUR 5.5
million (4.6).
- The investment in the production capacity expansion of flushable nonwovens at
Windsor Locks plant in the US was completed as planned.
- After the review period, Suominen divested its Flexibles business area. The
deal was closed on 14 July 2014. The enterprise value amounted to EUR 20
million and Suominen recognized a non-recurring loss of approximately EUR 4.5
million in the result of its discontinued operations.
- Suominen repeats its estimate, announced on 11 July 2014, according to which
Suominen expects that for the full year 2014, its net sales and operating
profit excluding non-recurring items from continuing operations will improve
from year 2013. Suominen's net sales of the continuing operations (Nonwovens
segment and unallocated items) in 2013 amounted to MEUR 373.7 and operating
profit excluding non-recurring items was MEUR 19.4 (revised). Earlier, the
comparison figures used in the outlook statement were, respectively, MEUR 433.1
and MEUR 18.3, as reported in the Financial Statements of 2013.
President & CEO Nina Kopola comments on Suominen's second quarter of 2014:
“The consumer confidence index in the euro zone strengthened in the second
quarter. The positive momentum in the U.S. economy also continued, which led to
a rise in consumer confidence. Suominen's main market areas are North America
and Europe.
The company's positive financial development continued into the second quarter.
Net sales from Suominen's continuing operations (not including the divested
Flexibles) improved from the comparison period, and operating profit excluding
non-recurring items increased by nearly a fifth to EUR 5.5 million, accounting
for 5.8% of Suominen's net sales. Cash flow from operations also grew
considerably from the comparison period, amounting to EUR 11.3 million.
In this strategy period - from the start of 2012 - Suominen's reported
operating profit has, with one exception, consistently improved, quarter on
quarter. This is a clear indication of the success of our strategy. Additional
proof of the successful implementation of the strategy is the achievement of
our medium-term financial targets: two out of three of these targets are
reviewed on quarterly basis and just like in the first quarter of the year, in
the April-June period Suominen reached the target level in these two. Our
gearing declined further and was 71.4% (target 40-80%) at the end of June. The
ROI from Suominen's continuing operations was 13.2% (target >10%).
After the review period, we sold our Flexibles business area to a UK-based
private equity firm and the business area's management. The transaction is a
continuation of our efforts to clarify our group structure, the first step of
which was the divestment of Codi Wipes in July 2013. The purchase of the
Brazilian unit in February 2014 expanded our core business operations to
emerging markets. The sale of Flexibles was the final step in Suominen's
transformation into a purely nonwovens company with operations on three
continents. Our group structure is now clear: we are solely focused on
nonwovens. This will allow us to focus all of our resources on developing and
globally growing this business.
With the divestment of Flexibles, Suominen's financial reporting will also be
simplified. Beginning with this interim report, Suominen will no longer report
on segments.
In connection with the sale of our Flexibles business unit, on 11 July 2014, we
also revised our outlook for 2014. We essentially restated our comparison
figures to reflect Suominen's continuing business, which is now focused solely
on developing and manufacturing nonwovens. Our estimate on the outlook for our
continuing business remained unchanged: we expect that both our net sales and
operating profit, excluding non-recurring items, will be better in 2014 than in
2013 when compared to Suominen's continuing operations.
The organizational restructuring that took effect at the turn of the year was
completed. In May, Lynda A. Kelly was appointed Senior Vice President of the
Care business area. Kelly brings her strong background in the nonwovens
industry to Suominen's Executive Team. Sourcing is a key function at Suominen,
and in July, Dan Dunbar was named Vice President of Sourcing.
Following these crucial decisions, we are now preparing Suominen's action plan
for the 2015-2017 strategy period. The strategy for the approaching years will
highlight the active development of a highly focused Suominen into a nonwovens
company, In The Lead. In future, we will focus even more strongly on growth.”
GROUP NET SALES AND FINANCIAL RESULT (CONTINUING OPERATIONS)
April - June 2014
Suominen has two business areas, Convenience and Care. Convenience business
area supplies nonwovens as roll goods for wiping products and travel & catering
applications. Care business area manufactures nonwovens for hygiene products
and medical applications. Until the end of the financial year 2013, both
business areas were reported in the Wiping segment. In the interim report for
January-March 2014, the business areas were reported in Nonwovens segment. As
from this interim report, Suominen does not report any segments.
In April-June 2014, Suominen's net sales from continuing operations grew by
2.4% from the comparison period to EUR 95.3 million (93.1). Net sales of
Convenience business area were EUR 87.6 million and net sales of Care business
area EUR 7.7 million.
Operating profit before non-recurring items increased by 19% and amounted to
EUR 5.5 million (4.6). Operating profit after non-recurring items was EUR 5.2
million (4.6). The non-recurring items reported in the review period amounted
to EUR -0.3 million (0.0) and were attributable to restructuring costs as well
as costs related to the acquisition of the Brazilian unit. Profit before taxes
was EUR 4.0 million (3.1). Profit for the period from continuing operations was
EUR 2.2 million (1.0) and from discontinued operations EUR -4.0 million
(-17.6). The Group profit for the period was EUR -1.8 million (-16.6).
If calculated with the average USD exchange rate of January-June 2013, the
operating profit before non-recurring items would have been EUR 5.8 million
(5.7) and after them 5.5 (5.7).
Healthy demand for nonwovens materials continued in North American market. In
Europe, continued tight competition put pressure on the sales prices. The
growth in net sales can largely be attributed to the acquisition of the
Brazilian unit in February. The increase in the share of products with higher
added value in sales was mirrored in gross profit and, consequently, in
improved operating profit.
The investment in capacity expansion of flushable nonwovens at the Windsor
Locks plant in the United States was completed in planned schedule and budget.
The installation shutdown for the new machinery ended in late April, and the
expanded capacity was operational in the end of May. The total value of the
investment is approximately EUR 2.5 million.
Cash flow from operations was EUR 11.3 million (2.9) in April - June. During
the reporting period EUR 4.0 million (2.7) in working capital was released.
January - June 2014
In January-June 2014, Suominen's net sales from continuing operations grew by
2% from the comparison period to EUR 193.7 million (190.4).
Net sales of Convenience business area were EUR 178.5 million and net sales of
Care business area EUR 15.2 million. The main application areas for nonwoven
materials supplied by Suominen were baby wipes (accounting for 40% of the
sales), personal care wipes (22%), household wipes (17%), industrial wipes
(12%), and hygiene and medical products (8%). All wiping products belong to the
Convenience business area and all medical and hygiene products belong to the
Care business area. The share of products with higher added value grew in the
portfolio. The share of nonwovens for baby wipes continued to decline.
Operating profit before non-recurring items from continuing operations
increased by 27% and amounted to EUR 11.9 million (9.4). Operating profit after
non-recurring items was EUR 11.4 million (9.4). The non-recurring items
reported in the review period amounted to EUR -0.5 million (0.0), of which EUR
-0.7 million were costs related to restructuring and acquisition of the
Brazilian unit; and EUR 0.2 million were items related to the closing down of
the fiber production in Nakkila in 2012. Profit before taxes was EUR 8.7
million (6.0). Profit for the period from continuing operations was EUR 4.8
million (2.5) and from discontinued operations EUR -3.7 million (-17.9). The
Group profit for the period was EUR 1.1 million (-15.5).
Cash flow from operations was EUR 10.8 million (0.8) in January - June. As of
the beginning of the year, EUR 4.8 million (5.7) in working capital was tied
up.
BUSINESS COMBINATIONS AND DISCONTINUED OPERATIONS
Business combinations
Suominen completed the acquisition of Paulínia plant in Brazil from Ahlstrom
Corporation on 10 February 2014. The Paulínia plant was part of Ahlstrom´s
former Home and Personal business operations, acquired by Suominen in 2011, but
the acquisition of the Brazilian unit was prolonged due to delay in receiving
approval from the authorities and consequent renegotiations. The transaction
was implemented through acquisition of the shares of the local company. The
enterprise value of the transaction was EUR 17.5 million and the final
consideration EUR 19.6 million.
Due to the transaction Suominen's nonwovens business has now a foothold in the
growing South American market region. The acquired plant is the only nonwovens
manufacturing facility utilizing modern spunlace technology in production of
wiping products in Brazil. The site employs some 40 people and its annual net
sales have amounted approximately to EUR 20 million.
Discontinued operations
Suominen reports in the discontinued operations Codi Wipes business unit,
divested in summer 2013 and the Flexibles business area sold in July 2014.
Prior to June 2013, Codi Wipes was reported as part of Suominen's Wiping
segment and prior to June 2014 Flexibles business as an individual segment.
Suominen reported a non-recurring loss of EUR 4.0 million in the review period
in its discontinued operations.
The profit after taxes from discontinued operations was EUR -21.8 million in
January-December 2013.
GROUP PROFIT FOR THE PERIOD (INCLUDING DISCONTINUED OPERATIONS)
The Group profit for April-June 2014 including the discontinued operations was
EUR -1.8 million (-16.6).
The Group profit for January-June 2014 including the discontinued operations
was EUR 1.1 million (-15.5).
FINANCING
The Group's interest-bearing net liabilities amounted to EUR 67.6 million
(102.0) at the end of the review period. In accordance with the company's
financing agreements, the net debt to EBITDA ratio was not to exceed 3.1 and
the gearing ratio not to exceed 115% in the end of the second quarter. At the
end of the second quarter, on 30 June 2014, the net debt to EBITDA was 2.1 and
the gearing ratio 71.4%.
In January-June, net financial expenses were EUR 2.7 million (3.4), or 1.4%
(1.8%) of net sales. A total of EUR 4.8 million of working capital was tied up
(tied up 5.7). Trade receivables amounting to EUR 7.4 million (13.9) were sold
to the bank. The equity ratio was 38.7% (31.0%). Cash flow from operations was
EUR 10.8 million (0.8), representing a cash flow of EUR 0.04 per share (0.00).
CAPITAL EXPENDITURE
The gross investments of the continued operations totaled EUR 3.5 million
(0.7). Planned depreciation of the continuing operations amounted to EUR 7.5
million (7.0). Suominen invested EUR 1.5 million in capacity expansion of high
value added nonwovens at the Windsor Locks plant in the United States and EUR
1.0 million in intangible assets. Other investments were in maintenance. The
investments of the discontinued operations were EUR 0.6 (0.9) million.
INFORMATION ON SHARES AND SHARE CAPITAL
Share capital
The registered number of Suominen's issued shares totals 247,934,122 shares,
equaling to a share capital of EUR 11,860,056.00.
Share trading and price
The number of Suominen Corporation shares traded on NASDAQ OMX Helsinki from 1
January to 30 June 2014 was 18,329,390 shares, accounting for 7.5% of the share
capital and votes. The trading price varied between EUR 0.47 and EUR 0.62. The
closing trading price was EUR 0.55, giving the company a market capitalization
of EUR 135,371,832 on 30 June 2014.
Own shares
On 1 January 2014 Suominen Corporation held 1,924,367 of its own shares. On 5
June 2014, the portion of the remuneration of the Board of Directors to be paid
in shares, in total 120,848 shares, was delivered in accordance with the
decision by the Annual General Meeting. On June 30 Suominen held 1,803,519 own
shares, accounting for 0.7% of the share capital and votes.
Share-based incentive plan
On 30 June 2014, the target group for Suominen's share-based incentive plan
included seven employees. One employee left the program during the review
period. At the end of the financial period, the rewards to be paid on the basis
of the plan corresponded to a maximum value of roughly 2,383,333 Suominen
Corporation shares in total, including the portion to be paid in cash. The aim
of the plan is to align the objectives of shareholders and key employees in
order to increase the value of the company, to commit the key employees to the
company, and to offer them a competitive reward plan based on long-term
shareholding in the company. The plan covers one performance period: the
calendar years 2012-2014. The potential reward from the performance period will
be based on Suominen Group's cumulative Earnings Before Interest, Taxes,
Depreciation and Amortization (EBITDA) and cumulative cash flow, and it will be
paid in 2015 partly in company shares and partly in cash.
Extraordinary General Meeting and hybrid bond
Suominen issued on 10 February 2014 a convertible hybrid bond of EUR
17,500,000, treated as equity, to finance the acquisition of the nonwovens
business operations in Brazil. The bond was oversubscribed. The bond consists
of 175 bond notes, each having the nominal value of EUR 100,000. The bond does
not have a guarantee or other collateral. The principal of the bond has a fixed
annual interest of 5.95% until 10 February 2018. After that date, the principal
of the bond will have a fixed annual interest of 6.95% until 10 February 2019.
After that date, the principal of the bond will have a fixed annual interest of
7.95%. The interest accrued for the bond by 10 February 2018 will be
capitalized to the principal of the bond annually on 10 February. Thereafter
and commencing on 10 May 2018, the interest is payable in the discretion of the
Board of Directors quarterly on 10 February, 10 May, 10 August and 10 November.
No interest shall be paid on the capitalized interest until 10 February 2018.
After that date, the capitalized interest shall be a part of the actual
principal of the bond and annual interest shall be paid to the whole amount of
the principal according to the interest terms of the bond.
Suominen has the right to redeem the bond in whole or in part on 10 February
2018 or thereafter, on each interest payment date, at the nominal value of the
bond together with the accrued interest.
A bond note entitles the bondholder to convert the bond note and the potential
capitalized interest for shares in Suominen at the conversion rate of EUR 0.50
per share. The period for converting starts on 11 February 2014 and ends on 10
February 2018. The number of shares to be received through the conversion must
always be at least 200,000. If the total value of the bond including interest
accrued were converted through an issue of new shares, the number of shares in
Suominen might increase by no more than 43,330,000 on the basis of the
conversion.
The conversion rate shall be recorded under the invested non-restricted equity
fund.
A precondition for issuing the hybrid bond was a resolution made by the
Extraordinary General Meeting (EGM) held on 31 January 2014, according to which
the Board of Directors of the company was authorized to decide on the granting
of stock options and other special rights entitling to shares referred to in
Chapter 10, Section 1 of the Companies Act. The special rights carry the right
to receive against payment new shares in the company or own shares held by the
company. A special right may also be granted to a creditor of the company on
the condition that the creditor´s receivables are used to set off against the
subscription price of shares. The maximum number of new shares that may be
subscribed and/or own shares held by the company that may be conveyed by virtue
of the special rights granted by the company is 43,333,000 shares in total.
The EGM authorized the Board of Directors of Suominen to decide on all terms
and conditions related to granting the special rights. The authorization is
valid until further notice, however no longer than five years from the date of
the authorization given by the general meeting. The authorizations did not
revoke any earlier decisions regarding granting of stock options and other
special rights entitling to shares.
Annual General Meeting
The Annual General Meeting (AGM) of Suominen Corporation was held on 26 March,
2014. The AGM decided that no dividend will be paid for the financial year
2013.
The AGM adopted the financial statements and the consolidated financial
statements for the financial year 2013 and discharged the members of the Board
of Directors and the President & CEO from liability.
The AGM confirmed the number of members of the Board of Directors to be five
(5). The AGM re-elected Mr Risto Anttonen, Mr Jorma Eloranta, Ms Suvi Hintsanen
and Mr Hannu Kasurinen as members of the Board of Directors, and elected Ms
Jaana Tuominen as a new member of the Board of Directors for the next term of
office, expiring at the end of the first Annual General Meeting following their
election. The remuneration of the members of the Board of Directors was
resolved to maintain unchanged. The resolutions were in accordance with the
proposals submitted by the Nomination Board of Suominen's shareholders. In its
constitutive meeting, the Board of Directors elected Jorma Eloranta as its
Chair and Risto Anttonen as Deputy Chair.
PricewaterhouseCoopers Oy, Authorized Public Accountants, was re-elected as
auditor, with Heikki Lassila, Authorized Public Accountant, as the principal
auditor of Suominen Corporation.
The AGM authorized the Board of Directors to decide on the repurchase of the
company's own shares and to decide on a share issue and issuance of special
rights entitling to shares referred to in Chapter 10, Section 1 of the
Companies Act.
Authorizations of the Board of Directors
The Annual General Meeting (AGM) held on 26 March 2014 authorized the Board of
Directors to repurchase a maximum of 3,000,000 of the company's own shares. The
authorization shall be valid until 30 June 2015.
The Board of Directors is also authorized, by the AGM held on 26 March 2014, to
decide on issuing new shares and/or conveying the company's own shares held by
the company and/or granting special rights entitling to shares referred to in
Chapter 10, Section 1 of the Finnish Companies Act. New shares may be issued
and/or company's own shares held by the company or its group company may be
conveyed at the maximum amount of 25,000,000 shares in aggregate. The maximum
number of new shares that may be subscribed and own shares held by the company
that may be conveyed by virtue of the options and other special rights granted
by the company is 25,000,000 shares in total which number is included in the
maximum number stated earlier. The authorizations revoke the authorizations
decided by the AGM on 26 March 2013 regarding share issue and issuance of
special rights entitling to shares, but do not revoke the authorization decided
by the Extraordinary General Meeting on 31 January 2014 regarding granting of
stock options and other special rights entitling to shares. The authorizations
shall be valid until 30 June 2017.
The portion of the remuneration of the members of the Board of Directors which
shall be paid in shares
The Annual General Meeting (AGM) of Suominen Corporation held on 26 March 2014
resolved to keep the remuneration to the members of the Board of Directors
unchanged. In 2014, the Chair will be paid an annual fee of EUR 50,000, Vice
Chair of the Board an annual fee of EUR 37,500 and other Board members an
annual fee of EUR 28,000. Further, the members of the Board will receive a fee
of EUR 500 for each meeting held in the home country of respective member and a
fee of EUR 1,000 per each meeting held elsewhere than in the home country of
respective member. 60 % of the annual remuneration is paid in cash and 40 % in
Suominen Corporation's shares.
The portion of the above remuneration to be paid in shares was delivered on 5
June 2014 by transferring own shares held by Suominen Corporation without
consideration, in accordance with the authorization by the AGM. The transferred
shares are of the same class as the company's other shares. The number of
shares transferred was determined based on the share value in the stock
exchange trading maintained by NASDAQ OMX Helsinki Ltd, and calculated as the
trade volume weighted average quotation of the share during the one month
period immediately following the date on which the interim report of
January-March 2014 of the company was published. In total 120,848 shares were
given out of the own shares held by the company by the decision of the Board of
Directors on 5 June 2014. Since the decision taken by the Board of Directors
was essentially an execution of a detailed resolution taken by the AGM, the
Board did not exercise independent discretion when it decided on the transfer
of the shares.
Permanent committees
After the Annual General Meeting held on 26 March 2014, Suominen Corporation's
Board of Directors decided in its constitutive meeting that the earlier
Remuneration Committee will be altered to Personnel and Remuneration Committee.
Jorma Eloranta was elected as Chair and Risto Anttonen as a member of the
committee.
Hannu Kasurinen was elected as Chair and Suvi Hintsanen and Jaana Tuominen as
members of the Audit Committee.
Notifications under Chapter 9, Section 10 of the Securities Market Act
During the review period, 1 January - 30 June 2014, Suominen received the
following notifications referred to in Chapter 9, Section 5 of the Securities
Market Act:
Oy Etra Invest Ab, business identity code 0672234-6 notified on 5 February 2014
about an agreement or other arrangement that, if realized, would result in the
crossing of the 5% notification threshold as referred to in the Chapter 9
Section 5 of the Securities Market Act and calculated from the total number of
shares and voting rights. The notification was made for Erkki Etola, Oy Etra
Invest Ab and Tiiviste-Group Oy (business identity code 0115121-4) together.
Erkki Etola has a controlling interest on Oy Etra Invest Ab and Tiiviste-Group
Oy.
Share of all shares and voting rights after crossing of the notification
threshold would be:
Oy Etra Invest Ab: number of shares 15,823,320 and share of all shares and
voting rights 5.43%
Erkki Etola: number of shares 4,016 and share of all shares and voting rights
0.00%
Tiiviste-Group Oy: number of shares 3,000,000 and share of all shares and
voting rights 1.03%
Oy Etra Invest Ab, Erkki Etola and Tiiviste-Group Oy in total: number of shares
18,827,336 and share of all shares and voting rights 6.46%
Ahlstrom Corporation (business identity code 1670043-1) notified on 5 February
2014 about an agreement or other arrangement that, if realized, would result in
the acquisition or disposal of shares or voting rights. According to the
notification, the ownership and the voting rights of Ahlstrom Corporation may
decrease so that the following thresholds will be crossed: 5%, 10%, 15%, 20% or
25%.
Ahlström Capital Oy (business identity code 1670034-3) and AC Invest Two B.V.
(registration code 51490943) notified on 5 February about an agreement or other
arrangement that, if realized, would result in the acquisition or disposal of
shares or voting rights. According to the notification, the ownership and the
voting rights may increase so that the following thresholds will be reached or
crossed: 5%, 10%, 15%, 20% or 25%.
Ahlstrom Corporation (business identity code 1670043-1) notified on 10 January
2014 about an agreement or other arrangement that, if realized, would result in
the acquisition or disposal of shares or voting rights. According to the
notification the ownership and the voting rights may increase or decrease so
that the following thresholds will be reached or crossed: 5%, 10%, 15%, 20%,
25% or 30%.
Ahlström Capital Oy (business identity code 1670034-3) and AC Invest Two B.V.
(registration code 51490943) notified on 10 January 2014 about an agreement or
other arrangement that, if realized, would result in the acquisition or
disposal of shares or voting rights. According to the notification the
ownership and the voting rights may increase so that the following thresholds
will be reached or crossed: 5%, 10%, 15%, 20%, 25% or 30%.
CHANGES IN MANAGEMENT
Ms Lynda A. Kelly joined Suominen as Senior Vice President, Care business area
and a member of the Corporate Executive Team on 12 May 2014. Lynda A. Kelly has
a long and wide-ranging experience in nonwovens business, especially in
hygiene, medical and wiping products. Lynda A. Kelly, a US citizen, will report
to Ms Nina Kopola, President & CEO of Suominen Corporation.
Mr Dan Dunbar joined Suominen as Vice President, Sourcing and a member of the
Corporate Leadership Team on 14 July 2014. Dan Dunbar is an experienced
sourcing professional with a versatile background in globally operating
organizations. Dan Dunbar, a US citizen, will report to Ms Nina Kopola,
President & CEO of Suominen Corporation.
EVENTS AFTER THE REVIEW PERIOD
Suominen Corporation announced on 11 July 2014 that it had reached an agreement
to divest its flexible packaging business, comprising of Suominen
Joustopakkaukset Oy and its subsidiaries as well as Suominen Polska Sp. z.o.o,
to a UK-based private equity firm Lonsdale Capital Partners LLP and the
management of the business. The transaction was closed on 14 July 2014. The
deal transformed Suominen into a company concentrated on nonwovens, in line
with its strategic focus.
The enterprise value of the Flexibles business area amounted to EUR 20 million,
on top of which there is a customary earn-out component amounting to around EUR
1 million. Suominen retains a minority shareholding of 19.9 % in the business
by converting parts of the currently outstanding intra-group loans into equity,
while parts of the above intra-group loans remain as vendor loan. The cash
component of the purchase price amounted to EUR 5.7 million.
Due to the divestment, Suominen recognized, in accordance with the IFRS 5
standard, a non-recurring loss of approximately EUR 4.5 million in the second
quarter result of 2014 in its discontinued operations.
BUSINESS RISKS AND UNCERTAINTIES
Due to the acquisition of the manufacturing plant in Brazil, the risks that are
characteristic to any developing region, including significant changes in
business environment or exchange rates, could have an impact on Suominen's
operations in Brazil.
The estimate on the development of Suominen's net sales is in part based on
forecasts and delivery plans received from customers. Changes in these
forecasts and plans resulting from changes in the market conditions or in
customers' inventory levels may affect Suominen's net sales. Due to the
continued uncertainty in the general economic situation and the cautious
consumer purchasing habits, the forecasts include uncertainty.
Suominen's customer base is fairly concentrated, which adds to the
customer-specific risk. Long-term contracts are preferred in the case of the
largest customers. In practice the customer relationships are long-term and
last for several years.
The continued positive development of Suominen's business operations in the
United States increases the relevance of the exchange rate risk related to USD
in the Group's total exchange risk position. Suominen hedges this foreign
exchange position in accordance with its hedging policy.
Suominen purchases significant amounts of pulp- and oil-based raw materials
annually. Raw materials are the largest cost item for operations. Rapid changes
in the global market prices of raw materials affect the company's
profitability. Extended interruptions in the supply of Suominen's main raw
materials could disrupt production and have a negative impact on the Group's
overall business operations. As Suominen sources its raw materials from a
number of major international suppliers, significant interruptions are
unlikely.
Suominen has numerous regional, national and international competitors in its
different product groups. There is currently oversupply in several product
groups, particularly in Europe. If Suominen is not able to compete through an
attractive product offering, it may lose some of its market share, and the
competition may lead to increased pricing pressure on the company's products.
The Group's damage risks are insured in order to guarantee the continuity of
operations. Suominen has valid damage and business interruption insurance
according to which it is estimated that the damages can be covered and the
financial losses caused by an interruption compensated.
Suominen's credit arrangements include covenants that the company must meet. At
the end of 2014, Suominen's net debt to EBITDA ratio may not exceed 2.4 and the
company's gearing ratio must be less than 95%. In this financial statement
release, these key figures are 2.1 and 71.4%.
The sensitivity of Suominen's goodwill to changes in business conditions is
described in the notes to the financial statements 2013. Actual cash flows may
deviate from the forecasted future discounted cash flows, as the long economic
lifetime of the company's non-current assets, and changes in the estimated
product prices, production costs, and interest rates used in discounting may
result in write-downs. The fair value based on the value in use of assets or
businesses in total or in part does not necessarily correspond to the price
that a third party would pay for them.
General risks related to business operations are described in the Report of the
Board of Directors 2013.
BUSINESS ENVIRONMENT
Suominen's products are used in daily consumer goods, such as wet wipes,
hygiene product and medical nonwovens. The general economic situation
determines the development of consumer demand, even though the demand for
consumer goods is not very cyclical in nature. Europe and North America are the
main market regions for Suominen.
In the euro area, the consumer confidence index strengthened in the second
quarter. However, the outlook of the general economic situation in Europe is
still uncertain and the competitive environment of the European nonwovens
market remains tight. The positive momentum in the U.S. economy continued,
which led to a rise in consumer confidence.
Suominen assesses the trend in the demand for its products on the basis of both
the general market situation and, above all, on the basis of the framework
agreements drawn up with its customers. Suominen estimates that in 2014, the
demand for its products will continue to grow at the pace of 2013.
OUTLOOK FOR 2014
Suominen repeats its estimate, announced on 11 July 2014, according to which
Suominen expects that for the full year 2014, its net sales and operating
profit excluding non-recurring items from continuing operations will improve
from year 2013. Suominen's net sales of the continuing operations (Nonwovens
segment and unallocated items) in 2013 amounted to MEUR 373.7 and operating
profit excluding non-recurring items was MEUR 19.4.
Earlier, the comparison figures used in the outlook statement were,
respectively, MEUR 433.1 and MEUR 18.3, as reported in the Financial Statements
of 2013.
SUOMINEN GROUP CONSOLIDATED 1 JANUARY - 30 JUNE 2014
This interim report has been prepared according to the principles defined in
IAS 34 Interim Financial Reporting. The principles for preparing the interim
report are the same as those used for preparing the financial statements for
2013, and this interim report should be read parallel to the financial
statements for 2013. Changes to published accounting standards and
interpretations, together with the new accounting standards that came into
force on 1 January 2014, are presented in the financial statements for 2013.
The figures in this interim report have not been audited.
BALANCE SHEET EUR 1,000 30 Jun 30 Jun 31 Dec
2014 2013 2013
--------------------------------------------------------------------------------
Assets
Non-current assets
Goodwill 15,496 15,496 15,496
Intangible assets 12,508 11,647 12,025
Tangible assets 87,467 106,009 98,640
Available-for-sale financial assets 922 19 939
Held-to-maturity investments 455 441 451
Other non-current receivables 511
Deferred tax assets 5,634 6,241 5,778
--------------------------------------------------------------------------------
Non-current assets, total 122,482 139,853 133,838
Current assets
Inventories 28,878 36,494 31,908
Trade receivables 48,657 52,428 46,908
Loan receivables 59 131
Other current receivables 6,480 9,708 6,359
Income tax receivables 695 730 1,182
Cash at bank and in hand 17,331 7,318 18,585
--------------------------------------------------------------------------------
Current assets, total 102,100 106,678 105,073
Assets held for sale 32,243 13,525
Assets, total 256,825 260,056 238,911
Shareholders' equity and liabilities
Equity attributable to owners of the parent
company
Share capital 11,860 11,860 11,860
Share premium account 24,681 24,681 24,681
Invested non-restricted equity fund 97,192 97,054 97,123
Fair value and other reserves -928 -731 -1,042
Translation differences -821 -613 3,022
Other shareholders' equity * -50,410 -51,555 -51,094
--------------------------------------------------------------------------------
Shareholders' equity 81,574 80,696 78,506
Hybrid bond 17,899
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Shareholders' equity, total 99,473 80,696 78,506
Liabilities
Non-current liabilities
Deferred tax liabilities 6,841 5,165 7,183
Provisions 605 132
Other non-current liabilities * 1,872 1,325 1,125
Interest-bearing liabilities 62,104 85,742 70,399
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Non-current liabilities, total 70,817 92,837 78,839
Current liabilities
Interest-bearing liabilities 22,940 23,570 24,071
Income tax liabilities 376 1,611 144
Trade payables and other current liabilities 49,666 55,892 57,351
--------------------------------------------------------------------------------
Current liabilities, total 72,982 81,073 81,567
Liabilities, total 143,799 173,910 160,405
Liabilities related to assets held for sale 13,553 5,450
Shareholders' equity and liabilities, total 256,825 260,056 238,911
STATEMENT OF INCOME
EUR 1,000 Q2/2014 Q2/2013 Q1-Q2/20 Q1-Q2/20 Q1-Q4/20
14 13 13
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Net sales 95,340 93,120 193,693 190,363 373,684
Cost of goods sold -84,399 -82,857 -171,438 -169,782 -333,580
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Gross profit 10,941 10,263 22,255 20,581 40,104
Other operating income 539 503 1,307 1,234 2,485
Sales and marketing expenses -1,712 -1,255 -3,157 -2,672 -5,583
Research and development -784 -774 -1,397 -1,687 -3,139
Administration expenses -3,440 -3,616 -6,899 -7,518 -13,659
Other operating expenses -20 -481 -201 -544 -810
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Operating profit before 5,524 4,640 11,908 9,394 19,398
non-recurring items
Non-recurring items -278 -511 -482
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Operating profit 5,246 4,640 11,397 9,394 18,916
Financial income and expenses -1,276 -1,526 -2,743 -3,366 -5,781
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Profit before income taxes 3,970 3,114 8,654 6,028 13,135
Income taxes -1,786 -2,091 -3,886 -3,573 -7,419
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Profit/loss for the period, 2,184 1,024 4,768 2,455 5,716
continuing operations
Discontinued operations 484 -832 793 -1,161 -3,518
Profit/loss for the period
Impairment loss recognized on -4,499 -16,760 -4,499 -16,760 -18,314
the remeasurement to fair value
and cost to sell
--------------------------------------------------------------------------------
Profit/loss for the period, -4,015 -17,592 -3,706 -17,921 -21,832
discontinued operations
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Profit/loss for the period -1,831 -16,568 1,062 -15,466 -16,119
Earnings/share, EUR 0.01 0.00 0.02 0.01 0.02
Continuing operations
Discontinued operations -0.02 -0.07 -0.02 -0.07 -0.09
Total -0.01 -0.07 0.00 -0.06 -0.07
Diluted, total -0.01 -0.07 0.00 -0.06 -0.07
STATEMENT OF COMPREHENSIVE INCOME
EUR 1,000 Q2/201 Q2/2013 Q1-Q2/201 Q1-Q2/201 Q1-Q4/201
4 4 3 3
--------------------------------------------------------------------------------
----------
Profit/loss for the period -1,831 -16,568 1,062 -15,466 -16,119
Other comprehensive income:
Items that may be reclassified
subsequently to profit or loss:
Currency translation 1,385 -1,643 2,233 -169 -2,664
differences on foreign operations
Fair value changes of cash 200 388 142 691 353
flow hedges
Items related to discontinuing 355
operations
Other reclassifications -72 -160 -58 -328 325
----------
----------
Total 1,513 -1,415 2,317 194 -1,631
----------------------------------------------------------------------
Items that will not be reclassified
subsequently to profit or loss:
Actuarial gains and losses 18
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Total 0 0 0 0 18
Income tax on other -78 83 -60 -64 120
comprehensive income
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Total other comprehensive 1,435 -1,332 2,257 130 -1,493
income
Total comprehensive income for -396 -17,900 3,319 -15,336 -17,612
the period
Total comprehensive income
arises from:
Continuing operations 3,311 -308 7,025 2,585 4,220
Discontinued operations -3,706 -17,592 -3,706 -17,921 -21,832
--------------------------------------------------------------------------------
Total comprehensive income for -396 -17,900 3,319 -15,336 -17,612
the period
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
a. Share capital
b. Share premium account
c. Invested non-restricted equity fund
d. Own shares
e. Translation differences
f. Fair value reserves
g. Other shareholders' equity
h. Shareholders' equity
i. Hybrid bond
j. Shareholders' equity total
EUR a. b. c. d. e. f. g. h. i.
j.
1,000
--------------------------------------------------------------------------------
--
--------------------------------------------------------------------------------
--
Total 11,860 24,681 97,123 -43 -3,022 -999 -51,094 78,506
78,506
equit
y at
1 Jan
2014
Profit 1,062 1,062
1,062
/loss
for
the
perio
d
Other 2,201 114 -74 2,241
2,241
compr
ehensi
ve
income
Share- 16 16
16
based
payme
nts
Convey 69 69
69
ance
of own
shares
Hybrid -320 -320 17,899
17,579
bond
--------------------------------------------------------------------------------
--
--------------------------------------------------------------------------------
--
Total 11,860 24,681 97,192 -43 -821 -885 -50,410 81,574 17,899
99,473
equit
y at
30 Jun
2014
EUR a. b. c. d. e. f. g. h. i. j.
1,000
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Total 11,860 24,681 97,054 -43 -549 -1,209 -35,783 96,011 96,011
equit
y at
1 Jan
2013
Profit -15,466 -15,466 -15,466
/loss
for
the
period
Other -64 522 -328 130 130
compr
ehensi
ve
income
*
Share- 21 21 21
based
payme
nts
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Total 11,860 24,681 97,054 -43 -613 -687 -51,556 80,696 80,696
equit
y at
30 Jun
2013
EUR a. b. c. d. e. f. g. h. i.
j.
1,000
--------------------------------------------------------------------------------
--
--------------------------------------------------------------------------------
--
Total 11,860 24,681 97,054 -43 -549 -1,209 -35,783 96,011
96,011
equit
y at
1 Jan
2013
Profit -16,119 -16,119
-16,119
/loss
for
the
period
Other -2,472 210 770 -1,493
-1,493
compr
ehensi
ve
income
Share- 38 38
38
based
payme
nts
Convey 69 69
69
ance
of own
share
s
--------------------------------------------------------------------------------
--
--------------------------------------------------------------------------------
--
Total 11,860 24,681 97,123 -43 -3,021 -999 -51,094 78,506
78,506
equit
y at
31 Dec
2013
CASH FLOW STATEMENT
EUR 1,000 Q1-Q2/201 Q1-Q2/201 Q1-Q4/201
4 3 3
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Operations
Operating profit 11,397 9,394 18,916
Total adjustments 10,150 3,606 7,704
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Cash flow before change in working capital 21,547 13,000 26,620
Change in working capital -4,845 -5,658 6,482
Financial items -2,792 -3,884 -6,216
Taxes paid -3,065 -2,693 -5,556
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Cash flow from operations 10,845 764 21,330
Investment payments
Investments in tangible and intangible assets -4,016 -1,823 -5,598
Business combinations -19,261
Proceeds from disposed business operations 3,441
Proceeds from disposal of fixed assets and 31 48 785
other proceeds
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Cash flow from investing activities -23,246 -1,775 -1,372
Financing
Repayments of non-current loans -4,304 -7,625 -21,042
Repayments of capital loans -920 -920
Hybrid bond 17,500
Change in current loans -632 6,300 6,300
Cash flow from financing 12,564 -2,245 -15,662
--------------------------------------------------------------------------------
Change in cash and cash equivalents * 163 -3,255 4,296
Cash and cash equivalents 18,585 14,301 14,301
Unrealized exchange rate differences -103 312 -13
Change in cash and cash equivalents 163 -3,255 4,296
--------------------------------------------------------------------------------
Cash and cash equivalents 18,646 11,358 18,585
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Assets held for sale, cash and cash equivalents -1,315 -4,040
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Cash and cash equivalents, continuing 17,331 7,318 18,585
operations
Cash flow statement includes discontinued operations.
KEY FIGURES Q2/201 Q2/201 Q1-Q2/201 Q1-Q2/201 Q1-Q4/201
4 3 4 3 3
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Net sales, change, % * 2.4 4.4 1.7 9.0 4.7
Gross profit, % ** 11.5 11.0 11.5 10.8 10.7
Operating profit, % ** 5.5 5.0 5.9 4.9 5.1
Financial income and -1.3 -1.6 -1.4 -1.8 -1.5
expenses, % **
Profit before income taxes, 4.2 3.3 4.5 3.2 3.5
% **
Profit for the period, %, 2.3 1.1 2.5 1.3 1.5
continuing
operations
Profit for the period, %, -4.2 -18.9 -1.9 -9.4 -5.8
discontinued
operations **
Profit for the period, % ** -1.9 -17.8 0.5 -8.1 -4.3
Earnings/share, EUR, 0.01 0.00 0.02 0.01 0.02
continuing operations
Earnings/share, EUR, -0.02 -0.07 -0.02 -0.07 -0.09
discontinued operations
Earnings/share, EUR, Group -0.01 -0.07 0.00 -0.06 -0.07
Diluted earnings/share, EUR, -0.01 -0.07 0.00 -0.06 -0.07
total
Equity/share, EUR 0.40 0.33 0.40 0.33 0.32
Cash flow from 0.05 0.01 0.04 0.00 0.09
operations/share, EUR
Return on equity (ROE), % 0.5 -24.9 0.5 -24.9 -18.6
Return on invested capital 8.4 -4.4 8.4 -4.4 -0.7
(ROI), %
Return on invested capital 13.2 9.3 13.2 9.3 12.4
(ROI), %, continuing
operations
Equity ratio, % 38.7 31.0 38.7 31.0 32.9
Gearing, % 71.4 121.4 71.4 121.4 96.2
Gross investments, 1,621 486 3,490 720 4,413
EUR 1,000, continuing
operations
Depreciation, EUR 1,000, 3,778 3,492 7,481 6,965 13,892
continuing operations
Average personnel, 588 546 550
continuing operations
*Compared with the same period last year.
** Share of net sales.
Non-current interest- 62,104 85,742 62,104 85,742 70,399
bearing liabilities
Current interest-bearing 22,940 23,570 22,940 23,570 24,071
liabilities
Interest-bearing receivables -17,491 -7,318 -17 491 -7,318 -18,985
including cash and cash
equivalents
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Interest-bearing net liabilities 67,553 101,994 67,553 101,994 75,485
BUSINESS COMBINATIONS
Suominen acquired the Brazilian unit of the Ahlstrom Home and Personal
nonwovens business on 10 February 2014. The main parts of the Home and Personal
nonwovens business were acquired in 2011, but due to the delays for some
licenses and authorizations the acquisition of the Brazilian business was
prolonged. Thanks to the acquisition, Suominen'snonwovens business has a better
coverage on the South American markets.
The balance sheet and the income statement of the Brazilian company were
consolidated to Suominen as from 1 February 2014.
The shares of the local company were acquired. The enterprise value was EUR
17.5 million. The final consideration was EUR 19.6 million.
Consideration Fair
value
--------------------------------------------------------------------------------
Cash 19,558
Recognized amounts of identifiable assets acquired and liabilities Fair
assumed according to the initial calculations: values
1 000 e
--------------------------------------------------------------------------------
Property, plant and equipment 10,463
Intangible assets 20
Other non-current receivables 1,392
Inventories 3,195
Trade and other receivables 5,084
Cash 297
Total assets 20,452
--------------------------------------------------------------------------------
Financial liabilities 416
Other liabilities 478
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Total liabilities 894
The identifiable net assets 19,558
--------------------------------------------------------------------------------
The transaction costs of EUR 0.2 million are reported in the non-recurring
items.
The Group´s net sales would have been EUR 195.2 million and operating profit
EUR 11.6 million, if the transaction had been realized at the start of 2014 and
the costs in the end of 2013.
DISCONTINUED OPERATIONS
EUR 1,000 Q1-Q2/2 Q1-Q2/2 Q1-Q4/2
014 013 013
--------------------------------------------------------------------------------
Net sales 30,881 28,998 59,438
Costs -29,890 -29,832 -62,601
--------------------------------------------------------------------------------
Profit before income taxes from discontinued 991 -834 -3,163
operations
Income taxes -198 28 -231
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Profit after income taxes from discontinued 793 -806 -3,394
operations
Impairment loss recognized on the remeasurement to -4,499
fair value and cost to sell
Profit/loss for the period from discontinued -3,706 -806 -3,394
operations
--------------------------------------------------------------------------------
Assets held for sale
Tangible and intangible assets 13,457
Non-current receivables 1,509
Inventories 7,209
Trade receivables and other current receivables 8,753
Cash at bank and in hand 1,315
Total 32,243
---------------------------------------------------------------
Liabilities related to assets held for sale
Non-current liabilities 4,692
Trade payables and other current liabilities 8,862
---------------------------------------------------------------
---------------------------------------------------------------
Total 13,554
Cash flow from discontinued operations
Cash flow from operations 375
Cash flow from investing activities -341
Cash flow from financing -989
---------------------------------------------------------------
---------------------------------------------------------------
Change in cash and cash equivalents -955
NET SALES BY MARKET AREA
EUR 1,000 Q1-Q2/2014 Q1-Q2/2013 Q1-Q4/2013
-----------------------------------------------------------
-----------------------------------------------------------
Finland 1,326 1,141 2,292
Europe, other 65,110 72,090 138,020
North and South America 122,326 112,428 224,132
Other countries 4,931 4,704 9,240
-----------------------------------------------------------
-----------------------------------------------------------
Net sales, total 193,693 190,363 373,684
QUARTERLY FIGURES
EUR 1,000 Q3/2013 Q4/2013 Q1/2014 Q2/2014 Q3/2013-
Q2/2014
--------------------------------------------------------------------------------
Net sales 93,484 89,837 98,353 95,340 377,014
Operating profit before 5,828 4,176 6,384 5,524 21,912
non-recurring items
% of net sales 6.2 4.6 6.5 5.8 5.8
Non-recurring items -482 -233 -278 -993
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Operating profit, total 5,828 3,694 6,151 5,246 20,919
% of net sales 6.2 4.1 6.3 5.5 5.5
Net financial expenses -1,319 -1,096 -1,467 -1,276 -5,158
--------------------------------------------------------------------------------
Profit before income taxes 4,509 2,598 4,684 3,970 15,761
TAXES FOR THE PERIOD UNDER REVIEW
Income tax expense is calculated by country, on the basis of taxable results
and income tax rates.
INFORMATION ON RELATED PARTIES
Suominen has related party relationships with the members of the Board of
Directors, and the members of the Corporate Executive Team, and Ahlstrom
Corporation, including its subsidiaries and associated companies. The company
has no associated companies. Salaries paid to the related parties amounted to
EUR 954 thousand, obligatory pension payments EUR 97 thousand, voluntary
pension payments EUR 56 thousand and share-based payments EUR 64 thousand.
Other related-party transactions
EUR 1,000 1-6/2014 1-6/2013 1-12/2013
--------------------------------------------------------------
--------------------------------------------------------------
Sales of goods and services 3,021 9,140 16,439
Purchases of goods and services 38,817 31,134 62,342
Trade and other receivables 979 1,551 1,396
Trade and other payables 9,035 1,416 2,073
Other related-party transactions are transactions with Ahlstrom Corporation and
its subsidiaries and associated companies.
CHANGES IN BORROWINGS
--------------------------------------------------------------------------------
EUR 1,000 Q1-Q2/201 Q1-Q2/201 Q1-Q4/201
4 3 3
--------------------------------------------------------------------------------
---------------------
Total borrowings on 1 January 94,471 111,518 111,518
Current loans from financial institutions on 1 24,071 20,571 20,571
January
Discontinued operations -500
Change in current loans from financial -631 2,999 3,500
institutions
-------------------------------------------------------------------------------- ---------------------
Current loans from financial institutions on 30 22,940 23,570 24,071
June
Non-current loans on 1 January 70,399 90,027 90,027
Discontinued operations -4,268
Change in non-current loans -4,027 -4,284 -19,628
--------------------------------------------------------------------------------
---------------------
Non-current loans on 30 June 62,104 85,742 70,399
Capital loans on 1 January 920 920
Change in capital loans -920 -920
--------------------------------------------------------------------------------
---------------------
Capital loans on 30 June 0 0 0
Total borrowings on 30 June 85,044 109,313 94,471
CHANGES IN FIXED ASSETS
Q1-Q2/2 Q1-Q2/2 Q1-Q4/2
014 013 013
EUR 1,000 Tangibl Intangi Tangibl Intangi Tangibl Intangi
e ble e ble e ble
--------------------------------------------------------------------------------
-----------------
Book value at the 98,640 12,025 118,019 12,529 118,019 12,529
beginning of the period
Investments 1,959 1,532 1,091 326 3,662 1,004
Decreases -6 -18 -18
Discontinued operations -18,484 -179 -5,365 -115 -5,365 -115
Business combinations 10,463 20
Depreciation -6,592 -888 -7,556 -756 -15,000 -1,545
Translation differences 1,472 -2 -163 -337 -2,658 152
and other changes
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Book value at the end of 87,467 12,508 106,009 11,647 98,640 12,025
the period
CONTINGENT LIABILITIES
EUR 1,000 Q1-Q2/2014 Q1-Q2/2013 Q1-Q4/2013
-----------------------------------------------------------------------------
-----------
For own debt
Secured loans 86,992 106,154 91,345
Nominal values of pledges
Real estate mortgages 27,047 27,042 27,042
Floating charges 161,829 190,624 165,761
Pledged subsidiary shares and loans 185,122 209,172 189,699
Other own commitments
Operating leases, real estates 21,864 24,700 22,672
Operating leases, machinery and equipment 2,247 2,798 2,373
Guarantee commitments 1,433
FINANCIAL ASSETS BY CATEGORY
a. Financial assets at fair value through profit or loss
b. Held-to-maturity investments
c. Loans and receivables
d. Available-for-sale financial assets
e. Book value
f. Fair value
Classes by instruments' nature
EUR 1,000 a. b. c. d. e. f.
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Available-for-sale financial assets 922 922 922
Held-to-maturity investments 455 455 455
Other non-current receivables
Loan receivables 59 59 59
Trade receivables 48,657 48,657 48,657
Other current receivables 111 111 111
Cash and cash equivalents 17,331 17,331 17,331
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Total at 30 Jun 2014 455 66,158 922 67,535 67,535
Classes by instruments' nature
EUR 1,000 a. b. c. d. e. f.
--------------------------------------------------------------------------
--------------------------------------------------------------------------
Available-for-sale financial assets 939 939 939
Held-to-maturity investments 451 451 451
Other non-current receivables 511 511 511
Loan receivables 131 131 131
Trade receivables 46,908 46,908 46,908
Other current receivables 58 371 429 429
Cash and cash equivalents 18,585 18,585 18,585
--------------------------------------------------------------------------
--------------------------------------------------------------------------
Total at 31 Dec 2013 569 451 65,996 939 67,954 67,954
Principles in estimating fair value for financial assets for 2014 are the same
as those used for preparing the financial statements for 2013.
FINANCIAL LIABILITIES
30 Jun 2014 31 Dec 2013
EUR 1,000 Book Fair Book Fair
value value value value
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
Non-current
Loans from financial institutions 61,818 61,297 69,828 69,144
Pension loans 286 285 571 577
Other non-current liablities 710 710
Total 62,814 62,292 70,399 69,721
-----------------------------------------------------------------------------
Current *)
Repayment of non-current liabilities
Loans from financial institutions 22,315 22,342 23,414 23,412
Pension loans 571 585 571 594
Financial leasing 54 54 86 86
Derivatives not held for hedge accounting 94 94
Derivatives held for hedge accounting 1,199 1,199 1,354 1,354
Other current liabilities 354
Trade payables 40,401 40,401 45,016 45,016
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
Total 64,894 64,580 70,535 70,556
Total 127,708 126,872 140,934 140,277
*) In the balance sheet under current liabilities.
Principles in estimating fair value for financial liabilities for 2014 are the
same as those used for preparing the financial statements for 2013.
FAIR VALUE MEASUREMENT HIERARCHY
EUR 1,000 Level 1 Level 2 Level 3
-------------------------------------------------------------
-------------------------------------------------------------
Assets measured at fair value
Assets held for sale 922
-------------------------------------------------------------
-------------------------------------------------------------
Total
Derivatives measured at fair value
Interest rate derivatives -957
Electricity derivatives -242
-------------------------------------------------------------
-------------------------------------------------------------
Total -1,199
Principles in estimating fair value for financial assets and their hierarchies
for 2014 are the same as those used for preparing the financial statements for
2013.
ANALYST AND PRESS CONFERENCE
Nina Kopola, President & CEO, and Tapio Engström, CFO, will present Suominen's
January-June 2014 financial result in Finnish at an analyst and press
conference in Helsinki today, on Friday 18 July 2014 at 10.00am (EEST). The
conference will take place at Hotel Haven, Unioninkatu 17, Helsinki. The
presentation material will be available after the analyst and press conference
at www.suominen.fi.
NEXT INTERIM REPORT
Suominen Corporation will publish its Interim report for January-September 2014
on Friday, 24 October 2014.
Helsinki, 18 July 2014
SUOMINEN CORPORATION
Board of Directors
For additional information, please contact:
Nina Kopola, President & CEO, tel. +358 (0)10 214 300
Tapio Engström, Senior Vice President and CFO, tel. +358 (0)10 214 300
Distribution:
NASDAQ OMX Helsinki Ltd
Key media
www.suominen.fi
Suominen in brief
Suominen manufactures nonwovens as roll goods for wipes as well as for medical
and hygiene products. The end products made of Suominen's nonwovens - wet
wipes, feminine care products and swabs, for instance - bring added value to
the daily life of consumers worldwide. Suominen is the global market leader in
nonwovens for wipes and employs approximately 600 people in Europe and in the
Americas. Suominen's net sales in 2013 amounted to MEUR 373.7 and operating
profit excluding non-recurring items to MEUR 19.4 (continuing operations). The
Suominen share (SUY1V) is listed in NASDAQ OMX Helsinki Stock Exchange. Read
more at www.suominen.fi.
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