2008-10-28 08:00:00 CET

2008-10-28 08:00:01 CET


REGULATED INFORMATION

Finnish English
Ponsse Oyj - Interim report (Q1 and Q3)

PONSSE'S INTERIM REPORT FOR 1 JANUARY - 30 SEPTEMBER 2008


PONSSE PLC STOCK EXCHANGE RELEASE 28 OCTOBER 2008 AT 9:00 A.M.                  

PONSSE'S INTERIM REPORT FOR 1 JANUARY - 30 SEPTEMBER 2008                       


- Turnover was EUR 216.2 million (Q1-Q3/2007 EUR 214.0 million).                

- Q3 turnover was EUR 54.8 million (Q3/2007 EUR 64.0 million).                  

- Operating profit was EUR 17.8 (24.0) million and accounted for 8.2 (11.2) per 
cent of the turnover.                                                           

- Q3 operating profit was EUR 0.1 million (Q3/2007 EUR 6.4 million).            

- Profit before taxes was EUR 15.8 (24.1) million.                              

- Earnings per share were EUR 0.38 (0.62).                                      

- Order books were valued at EUR 61.0 (80.7) million.                           


PRESIDENT AND CEO JUHO NUMMELA:                                                 

The demand for forest machines declined during the third quarter in most main   
market areas except for Finland and Sweden. The global economic situation also  
delayed machine deliveries to customers in export countries. Turnover remained  
on par with the comparison period. Operating profit remained below the previous 
year's level due to machine delivery volumes falling short of targets and an    
increase in expenses.                                                           

Order flow decreased from last year. We initiated group-level measures to adjust
production volumes and resources to the prevailing and anticipated demand.      
TURNOVER                                                                        

Consolidated turnover for the period totalled EUR 216.2 (214.0) million.        

PROFIT PERFORMANCE     

Operating profit was EUR 17.8 (24.0) million. Operating profit accounted for 8.2
(11.2) per cent of turnover in the period under review. Return on capital       
employed (ROCE) stood at 19.1 (35.2) per cent.                                  

Staff costs for the period under review totalled EUR 35.9 (30.3) million, and   
other operating expenses EUR 23.8 (21.8) million. Net financial expenses were   
EUR -2.1 (-0.9) million. Income and expenses resulting from currency risk       
hedging were included in the financial items. Profit for the period totalled EUR
10.7 (17.3) million. Diluted and basic earnings per share (EPS) were EUR 0.38   
(0.62). The company does not have any items that could have a dilutive effect on
the earnings per share.                                                         

BALANCE SHEET AND FINANCIAL POSITION                                            

At the end of the period under review, the consolidated balance sheet total     
amounted to EUR 187.0 (142.5) million. Inventories were clearly higher than last
year. The amount of Inventories was EUR 102.1 (67.7) million. Trade receivables 
totalled EUR 28.9 (24.6) million and liquid assets stood at EUR 4.4 (8.3)       
million. The amount of Group capital and reserves was EUR 73.3 (67.2) million.  
The amount of interest-bearing liabilities was EUR 67.2 (31.5) million. The     
parent company's net receivables from other Group companies stood at EUR 65.7   
(30.3) million. Consolidated net liabilities totalled EUR 61.9 (22.3) million.  
The equity ratio stood at 39.4 per cent (47.5 per cent) at the end of the period
under review.                                                                   

Cash flow from business operations amounted to EUR -21.1 (14.5) million. Cash   
flow from investing activities amounted to EUR -6.4 (-4.3) million.             

ORDER INTAKE AND ORDER BOOKS                                                    

Order intake for the period totalled EUR 167.2 (235.7) million, while period-end
order books were valued at EUR 61.0 (80.7) million. The order books included    
dealers' minimum purchase commitments, based on previous practice.              

CAPITAL EXPENDITURE AND R&D                                                     

The Group's R&D expenses totalled EUR 5.2 million (EUR 3.9 million) during the  
period under review. The amount of activated R&D expenses during the period was 
EUR 906 thousand (EUR 686 thousand).                                            

Capital expenditure totalled EUR 6.4 million (EUR 4.3 million).                 

PERSONNEL                                                                       

The Group had an average staff of 1,048 (858) during the period and employed    
1,065 (873) people at period-end.                                               

SHARE PERFORMANCE                                                               

The trading volume of Ponsse Plc shares for 1 January - 30 September 2008       
totalled 1,638,954, accounting for 5.9 per cent of the total number of shares.  
Share turnover came to EUR 21.0 million, with the period's lowest and highest   
share prices amounting to EUR 8.23 and EUR 16.29 respectively.                  

At the end of the period, shares closed at EUR 8.50 and market capitalisation   
totalled EUR 238.0 million.                                                     

At the end of the reporting period the company had 47,900 shares in its         
possession.                                                                     

GOVERNANCE                                                                      

The company adheres to the insider regulations approved by the Helsinki Stock   
Exchange Board of Directors and the Corporate Governance Recommendation for     
Listed Companies issued by NASDAQ OMX Helsinki Oy Plc, the Central Chamber of   
Commerce of Finland and the Confederation of Finnish Industry and Employers. The
governance principles are available on Ponsse's website in the Investors        
section.                                                                        

BUSINESS RISKS AND THEIR MANAGEMENT                                             

The uncertain general economic situation and global disturbances in the         
financial market have weakened both the predictability of the business outlook  
and the demand for forest machines. The declining economic trend has increased  
the risks associated with raw material and component availability and with      
subcontractor and supplier network operation. Ponsse aims to manage and minimise
these risks through partnership cooperation. As part of its risk management     
efforts related to the availability of certain key components, the company has  
chosen to manufacture these components in-house.                                

A fall in the demand for the company's products could lead to production        
overcapacity with regard to the market situation and demand. To address the     
situation, the company will reduce its material flows and adjust production     
resources to the prevailing market situation.                                   

The key objectives of the company's financing risk management include           
controlling the liquidity, interest and currency risks. Ponsse has ensured its  
liquidity by means of credit limit agreements with a number of financial        
institutions. In order to minimise the impact of any adverse changes in interest
rates the company uses interest rate swaps and credits tied to different        
reference rates. Derivative contracts and currency-denominated credits are used 
to minimise the adverse effect of changes in exchange rates.                    

EVENTS AFTER THE PERIOD UNDER REVIEW                                            

On 16.10.2008, Ponsse announced it will start negotiations with personnel under 
the Act on Co-operation within Undertakings. The purpose is to determine how the
company's production capacity and cost structure can be adjusted to the         
prevailing market situation.                                                    

OUTLOOK FOR THE FUTURE                                                          

Disturbances in the global economy and the financial market increased and       
economic predictability weakened during the third quarter. The uncertain        
economic outlook will also be reflected in the forest machine market during the 
rest of the year, increasing its challenges compared with the situation a year  
ago.                                                                            

The company will continue its efforts to improve the efficiency of its cost     
management and to release working capital. The company expects the economic     
situation to improve material availability and reduce pressure for increased    
material expenses.                                                              

Although it is typical of the entire industry that machine sales are            
concentrated at the end of the year in several market areas, the prevailing     
economic situation is expected to have a dampening effect on sales. Ponsse      
expects its 2008 turnover and operating profit to remain below the previous     
year's level.                                                                   

PONSSE GROUP                                                                    

CONSOLIDATED PROFIT AND LOSS ACCOUNT (EUR 1,000)                                

--------------------------------------------------------------------------------
|                        |         |     IFRS |     IFRS |     IFRS |          |
--------------------------------------------------------------------------------
|                        |         |   1-9/08 |   1-9/07 |  1-12/07 |          |
--------------------------------------------------------------------------------
| TURNOVER               |         |  216,220 |  213,966 |  310,053 |          |
--------------------------------------------------------------------------------
| Increase (+)/decrease (-) in     |   18,222 |    5,820 |    2,159 |          |
| Inventories of finished goods    |          |          |          |          |
| and work in progress             |          |          |          |          |
--------------------------------------------------------------------------------
| Other operating income |         |    1,458 |      746 |    1,326 |          |
--------------------------------------------------------------------------------
| Raw materials and      |         | -154,638 | -141,305 | -199,253 |          |
| services               |         |          |          |          |          |
--------------------------------------------------------------------------------
| Expenditure on                   |  -35,943 |  -30,294 |  -42,538 |          |
| employment-related benefits      |          |          |          |          |
--------------------------------------------------------------------------------
| Depreciation and       |         |   -3,700 |   -3,164 |   -4,270 |          |
| amortisation           |         |          |          |          |          |
--------------------------------------------------------------------------------
| Other operating        |         |  -23,843 |  -21,816 |  -30,398 |          |
| expenses               |         |          |          |          |          |
--------------------------------------------------------------------------------
| OPERATING PROFIT       |         |   17,778 |   23,953 |   37,080 |          |
--------------------------------------------------------------------------------
| Share of results of associated   |       51 |      981 |    1,002 |          |
| companies                        |          |          |          |          |
--------------------------------------------------------------------------------
| Financial income and   |         |   -2,078 |     -860 |   -1,698 |          |
| expenses               |         |          |          |          |          |
--------------------------------------------------------------------------------
| PROFIT BEFORE TAXES              |   15,750 |   24,074 |   36,384 |          |
--------------------------------------------------------------------------------
| Income taxes           |         |   -5,071 |   -6,805 |   -9,907 |          |
--------------------------------------------------------------------------------
| PROFIT FOR THE PERIOD  |         |   10,680 |   17,269 |   26,477 |          |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Diluted and basic      |         |     0.38 |     0.62 |     0.95 |          |
| earnings per share     |         |          |          |          |          |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
|                        |         |     IFRS |     IFRS |          |          |
--------------------------------------------------------------------------------
|                        |         |   7-9/08 |   7-9/07 |          |          |
--------------------------------------------------------------------------------
| TURNOVER               |         |   54,773 |   64,024 |          |          |
--------------------------------------------------------------------------------
| Increase (+)/decrease (-) in     |    8,679 |      584 |          |          |
| Inventories of finished goods    |          |          |          |          |
| and work in progress             |          |          |          |          |
--------------------------------------------------------------------------------
| Other operating income |         |      502 |      215 |          |          |
--------------------------------------------------------------------------------
| Raw materials and      |         |  -44,099 |  -40,644 |          |          |
| services               |         |          |          |          |          |
--------------------------------------------------------------------------------
| Expenditure on                   |  -10,341 |   -9,279 |          |          |
| employment-related benefits      |          |          |          |          |
--------------------------------------------------------------------------------
| Depreciation and       |         |   -1,290 |   -1,060 |          |          |
| amortisation           |         |          |          |          |          |
--------------------------------------------------------------------------------
| Other operating        |         |   -8,130 |   -7,452 |          |          |
| expenses               |         |          |          |          |          |
--------------------------------------------------------------------------------
| OPERATING PROFIT       |         |       96 |    6,389 |          |          |
--------------------------------------------------------------------------------
| Share of results of associated   |      -44 |       65 |          |          |
| companies                        |          |          |          |          |
--------------------------------------------------------------------------------
| Financial income and   |         |   -1,130 |     -194 |          |          |
| expenses               |         |          |          |          |          |
--------------------------------------------------------------------------------
| PROFIT BEFORE TAXES              |   -1,078 |    6,260 |          |          |
--------------------------------------------------------------------------------
| Income taxes           |         |     -619 |   -1,935 |          |          |
--------------------------------------------------------------------------------
| PROFIT FOR THE PERIOD  |         |   -1,697 |    4,324 |          |          |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Diluted and basic      |         |    -0.06 |     0.15 |          |          |
| earnings per share     |         |          |          |          |          |
--------------------------------------------------------------------------------


CONSOLIDATED BALANCE SHEET (EUR 1,000)                                          

--------------------------------------------------------------------------------
|                                       |       IFRS |       IFRS |       IFRS |
--------------------------------------------------------------------------------
| ASSETS                                |    30.9.08 |    30.9.07 |   31.12.07 |
--------------------------------------------------------------------------------
| NON-CURRENT ASSETS                    |            |            |            |
--------------------------------------------------------------------------------
| Intangible assets                     |      5,097 |      4,094 |      4,262 |
--------------------------------------------------------------------------------
| Goodwill                              |      3,696 |      3,750 |      3,737 |
--------------------------------------------------------------------------------
| Property, plant and equipment         |     27,887 |     24,957 |     25,946 |
--------------------------------------------------------------------------------
| Financial assets                      |        110 |         26 |        128 |
--------------------------------------------------------------------------------
| Holdings in associated companies      |      1,849 |      2,135 |      2,156 |
--------------------------------------------------------------------------------
| Non-current receivables               |        409 |        120 |        403 |
--------------------------------------------------------------------------------
| Deferred tax assets                   |      2,939 |      1,141 |      1,686 |
--------------------------------------------------------------------------------
| TOTAL NON-CURRENT ASSETS              |     41,988 |     36,223 |     38,318 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| CURRENT ASSETS                        |            |            |            |
--------------------------------------------------------------------------------
| Inventories                           |    102,124 |     67,723 |     65,635 |
--------------------------------------------------------------------------------
| Trade receivables                     |     28,913 |     24,556 |     29,276 |
--------------------------------------------------------------------------------
| Income tax receivables                |      1,160 |        384 |        861 |
--------------------------------------------------------------------------------
| Other current receivables             |      8,471 |      5,335 |      7,191 |
--------------------------------------------------------------------------------
| Liquid assets                         |      4,384 |      8,258 |     12,633 |
--------------------------------------------------------------------------------
| TOTAL CURRENT ASSETS                  |    145,052 |    106,256 |    115,595 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| TOTAL ASSETS                          |    187,040 |    142,479 |    153,914 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| CAPITAL AND RESERVES, AND LIABILITIES |            |            |            |
--------------------------------------------------------------------------------
| CAPITAL AND RESERVES                  |            |            |            |
--------------------------------------------------------------------------------
| Share capital                         |      7,000 |      7,000 |      7,000 |
--------------------------------------------------------------------------------
| Other reserves                        |       -645 |         20 |         19 |
--------------------------------------------------------------------------------
| Translation differences               |       -974 |       -935 |       -943 |
--------------------------------------------------------------------------------
| Retained earnings                     |     67,869 |     61,093 |     70,456 |
--------------------------------------------------------------------------------
| CAPITAL AND RESERVES OWNED            |            |            |            |
--------------------------------------------------------------------------------
| BY PARENT COMPANY SHAREHOLDERS        |     73,250 |     67,177 |     76,532 |
--------------------------------------------------------------------------------
| Minority interest                     |          0 |          0 |          0 |
--------------------------------------------------------------------------------
| TOTAL CAPITAL AND RESERVES            |     73,250 |     67,177 |     76,532 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| NON-CURRENT LIABILITIES               |            |            |            |
--------------------------------------------------------------------------------
| Interest-bearing liabilities          |     34,706 |     22,173 |     16,717 |
--------------------------------------------------------------------------------
| Deferred tax liabilities              |        722 |        798 |        768 |
--------------------------------------------------------------------------------
| Other non-current liabilities         |         30 |         30 |         30 |
--------------------------------------------------------------------------------
| TOTAL NON-CURRENT LIABILITIES         |     35,458 |     23,001 |     17,515 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| CURRENT LIABILITIES                   |            |            |            |
--------------------------------------------------------------------------------
| Interest-bearing liabilities          |     32,544 |      9,351 |     17,225 |
--------------------------------------------------------------------------------
| Provisions                            |      5,296 |      4,091 |      4,341 |
--------------------------------------------------------------------------------
| Tax liabilities for the period        |        860 |        822 |      1,752 |
--------------------------------------------------------------------------------
| Trade creditors and other current     |     39,633 |     38,037 |     36,548 |
| liabilities                           |            |            |            |
--------------------------------------------------------------------------------
| TOTAL CURRENT LIABILITIES             |     78,332 |     52,301 |     59,867 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| TOTAL CAPITAL AND RESERVES, AND       |    187,040 |    142,479 |    153,914 |
| LIABILITIES                           |            |            |            |
--------------------------------------------------------------------------------

CONSOLIDATED CASH FLOW STATEMENT (EUR 1,000)                                    

--------------------------------------------------------------------------------
|                              |         |      IFRS |       IFRS |       IFRS |
--------------------------------------------------------------------------------
|                              |         |    1-9/08 |     1-9/07 |    1-12/07 |
--------------------------------------------------------------------------------
| BUSINESS OPERATIONS:         |         |           |            |            |
--------------------------------------------------------------------------------
| Profit for the period        |         |    10,680 |     17,269 |     26,477 |
--------------------------------------------------------------------------------
| Adjustments:                 |         |           |            |            |
--------------------------------------------------------------------------------
| Financial income and         |         |     2,078 |        860 |      1,698 |
| expenses                     |         |           |            |            |
--------------------------------------------------------------------------------
| Share of the result of associated      |       -51 |       -981 |     -1,002 |
| companies                              |           |            |            |
--------------------------------------------------------------------------------
| Depreciation and             |         |     3,700 |      3,164 |      4 270 |
| amortisation                 |         |           |            |            |
--------------------------------------------------------------------------------
| Income taxes                 |         |     6,271 |      7,022 |      9 897 |
--------------------------------------------------------------------------------
| Other adjustments            |         |    -1,686 |        -55 |       -717 |
--------------------------------------------------------------------------------
| Cash flow before change in working     |    20 991 |     27,279 |     40,623 |
| capital                                |           |            |            |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Change in working capital:   |         |           |            |            |
--------------------------------------------------------------------------------
| Change in current                                  |            |            |
--------------------------------------------------------------------------------
| non-interest-bearing         |         |      -904 |     -6,633 |    -13,091 |
| receivables                  |         |           |            |            |
--------------------------------------------------------------------------------
| Change in inventories        |         |   -36,489 |     -9,108 |     -7,020 |
--------------------------------------------------------------------------------
| Change in current                                  |            |            |
--------------------------------------------------------------------------------
| non-interest-bearing         |         |     2,746 |      9,816 |      8,220 |
| creditors                    |         |           |            |            |
--------------------------------------------------------------------------------
| Change in provisions for     |         |       955 |        574 |        824 |
| liabilities and charges      |         |           |            |            |
--------------------------------------------------------------------------------
| Interest received            |         |       113 |        126 |        298 |
--------------------------------------------------------------------------------
| Interest paid                |         |    -1,596 |     -1,136 |     -1,463 |
--------------------------------------------------------------------------------
| Other financial items        |         |      -327 |         72 |       -505 |
--------------------------------------------------------------------------------
| Income taxes paid            |         |    -6,601 |     -6,465 |     -8,886 |
--------------------------------------------------------------------------------
| NET CASH FLOW FROM BUSINESS  |         |   -21,114 |     14,525 |     19,001 |
| OPERATIONS (A)               |         |           |            |            |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| INVESTMENTS                  |         |           |            |            |
--------------------------------------------------------------------------------
| Investments in tangible and intangible |    -6,475 |     -4,301 |     -6,565 |
| assets                                 |           |            |            |
--------------------------------------------------------------------------------
| Investments in other assets            |         0 |          0 |          0 |
--------------------------------------------------------------------------------
| Repayment of loan            |         |        27 |         13 |        -14 |
| receivables                  |         |           |            |            |
--------------------------------------------------------------------------------
| Dividends received           |         |         0 |          3 |        178 |
--------------------------------------------------------------------------------
| CASH OUTFLOW FROM INVESTING  |         |    -6,448 |     -4,286 |     -6,401 |
| ACTIVITIES (B)               |         |           |            |            |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| FINANCING                    |         |           |            |            |
--------------------------------------------------------------------------------
| Withdrawal/Repayment of      |         |           |            |            |
--------------------------------------------------------------------------------
| current loans                |         |    15,743 |      1,360 |      8,855 |
--------------------------------------------------------------------------------
| Change in current            |         |           |            |            |
--------------------------------------------------------------------------------
| interest-bearing liabilities |         |       -13 |         26 |        -93 |
--------------------------------------------------------------------------------
| Withdrawal/Repayment of      |         |           |            |            |
--------------------------------------------------------------------------------
| non-current loans            |         |    17,988 |       -279 |     -5,735 |
--------------------------------------------------------------------------------
| Payment of finance lease liabilities   |      -424 |       -497 |       -116 |
--------------------------------------------------------------------------------
| Change in non-current receivables      |        -6 |         44 |       -239 |
--------------------------------------------------------------------------------
| Dividends paid               |         |   -13,976 |    -11,200 |    -11,200 |
--------------------------------------------------------------------------------
| NET CASH OUTFLOW FROM        |         |    19,312 |    -10,545 |     -8,529 |
| FINANCING (C)                |         |           |            |            |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Change in liquid assets      |         |    -8,249 |       -306 |      4,071 |
| (A+B+C)                      |         |           |            |            |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Liquid assets on 1 Jan       |         |    12,633 |      8,562 |      8,562 |
--------------------------------------------------------------------------------
| Liquid assets on 30 Sept / 31 Dec      |     4,384 |      8,256 |     12,633 |
--------------------------------------------------------------------------------
RECONCILIATION OF CAPITAL AND RESERVES (EUR 1,000)                              

--------------------------------------------------------------------------------
| A = Share Capital  |        |         |         |         |        |         |
--------------------------------------------------------------------------------
| B = Share premium and other |         |         |         |        |         |
| reserves                    |         |         |         |        |         |
--------------------------------------------------------------------------------
| C = Translation    |        |         |         |         |        |         |
| differences        |        |         |         |         |        |         |
--------------------------------------------------------------------------------
| D = Own shares              |         |         |         |        |         |
--------------------------------------------------------------------------------
| E = Retained earnings                                                        |
--------------------------------------------------------------------------------
| F = Total capital  |        |         |         |         |        |         |
| and reserves       |        |         |         |         |        |         |
--------------------------------------------------------------------------------
|                    | CAPITAL AND RESERVES OWNED BY PARENT |        |         |
|                    |         COMPANY SHAREHOLDERS         |        |         |
--------------------------------------------------------------------------------
|                    |      A |       B |       C |       D |      E |       F |
--------------------------------------------------------------------------------
| CAPITAL AND        |  7,000 |      20 |    -943 |       0 | 70,455 |  76,532 |
| RESERVES 1 JAN     |        |         |         |         |        |         |
| 2008               |        |         |         |         |        |         |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Translation        |      0 |       0 |     -31 |    -665 |    710 |      14 |
| differences        |        |         |         |         |        |         |
--------------------------------------------------------------------------------
| NET INCOME         |        |         |         |         |        |         |
| RECOGNISED         |        |         |         |         |        |         |
--------------------------------------------------------------------------------
| DIRECTLY IN EQUITY |      0 |       0 |     -31 |    -665 |    710 |      14 |
--------------------------------------------------------------------------------
| Net profit for the |      0 |       0 |         |         | 10,680 |  10,680 |
| period             |        |         |         |         |        |         |
--------------------------------------------------------------------------------
| TOTAL RECOGNISED   |      0 |       0 |     -31 |    -665 | 11,390 |  10,694 |
| INCOME AND         |        |         |         |         |        |         |
| EXPENSES           |        |         |         |         |        |         |
--------------------------------------------------------------------------------
| Dividend           |      0 |       0 |         |         | -13,97 | -13,976 |
| distribution       |        |         |         |         |      6 |         |
--------------------------------------------------------------------------------
| CAPITAL AND        |  7,000 |      20 |    -974 |    -665 | 67,869 |  73,250 |
| RESERVES 30 SEPT   |        |         |         |         |        |         |
| 2008               |        |         |         |         |        |         |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| CAPITAL AND        |  7,000 |      20 |    -750 |       0 | 54,887 |  61,157 |
| RESERVES 1 JAN     |        |         |         |         |        |         |
| 2007               |        |         |         |         |        |         |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Translation        |      0 |       0 |    -185 |       0 |    136 |     -49 |
| differences        |        |         |         |         |        |         |
--------------------------------------------------------------------------------
| NET INCOME         |        |         |         |         |        |         |
| RECOGNISED         |        |         |         |         |        |         |
--------------------------------------------------------------------------------
| DIRECTLY IN EQUITY |      0 |       0 |    -185 |       0 |    136 |     -49 |
--------------------------------------------------------------------------------
| Net profit for the |      0 |       0 |       0 |         | 17,269 |  17,269 |
| period             |        |         |         |         |        |         |
--------------------------------------------------------------------------------
| TOTAL RECOGNISED   |      0 |       0 |    -185 |       0 | 17,405 |  17,220 |
| INCOME AND         |        |         |         |         |        |         |
| EXPENSES           |        |         |         |         |        |         |
--------------------------------------------------------------------------------
| Dividend           |      0 |       0 |         |         | -11,20 | -11,200 |
| distribution       |        |         |         |         |      0 |         |
--------------------------------------------------------------------------------
| CAPITAL AND        |  7,000 |      20 |    -935 |       0 | 61,092 |  67,177 |
| RESERVES 30 SEPT   |        |         |         |         |        |         |
| 2007               |        |         |         |         |        |         |
--------------------------------------------------------------------------------


--------------------------------------------------------------------------------
|                        |         |          |  30.9.08 |  30.9.07 | 31.12.07 |
--------------------------------------------------------------------------------
| 1. LEASING COMMITMENTS |         |          |    5,453 |    2,251 |    2,519 |
| (EUR 1,000)            |         |          |          |          |          |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| 2. CONTINGENT LIABILITIES (EUR   |          |  30.9.08 |  30.9.07 | 31.12.07 |
| 1,000)                           |          |          |          |          |
--------------------------------------------------------------------------------
| Guarantees given on    |         |          |    1,349 |    1,355 |    1,285 |
| behalf of others       |         |          |          |          |          |
--------------------------------------------------------------------------------
| Repurchase commitments |         |          |    4,604 |    2,145 |    1,802 |
--------------------------------------------------------------------------------
| Other commitments      |         |          |      574 |    1,212 |    1,059 |
--------------------------------------------------------------------------------
| TOTAL                  |         |          |    6,527 |    4,712 |    4,146 |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| 3. PROVISIONS (EUR     |         |          | Guarantee provision |          |
| 1,000)                 |         |          |                     |          |
--------------------------------------------------------------------------------
| 1.1.2008               |         |          |    4,341 |          |          |
--------------------------------------------------------------------------------
| Increase               |         |          |    1,325 |          |          |
--------------------------------------------------------------------------------
| Used provisions        |         |          |     -370 |          |          |
--------------------------------------------------------------------------------
| 30.9.2008              |         |          |    5,296 |          |          |
--------------------------------------------------------------------------------


--------------------------------------------------------------------------------
| KEY FIGURES AND RATIOS |         |          |  30.9.08 |  30.9.07 | 31.12.07 |
--------------------------------------------------------------------------------
| R&D expenditure, MEUR            |          |      5.2 |      3.9 |      5.7 |
--------------------------------------------------------------------------------
| Capital expenditure, MEUR                   |      6,5 |      4.3 |      6.6 |
--------------------------------------------------------------------------------
| as % of turnover       |         |          |      3.0 |      2.0 |      2.1 |
--------------------------------------------------------------------------------
| Average number of      |         |          |    1,048 |      858 |      876 |
| employees              |         |          |          |          |          |
--------------------------------------------------------------------------------
| Order books, MEUR      |         |          |     61.0 |     80.7 |    110.1 |
--------------------------------------------------------------------------------
| Equity ratio, %        |         |          |     39.4 |     47.5 |     50.3 |
--------------------------------------------------------------------------------
| Diluted and basic earnings per share, EUR   |     0,38 |     0.62 |     0.95 |
--------------------------------------------------------------------------------
| Equity per share, EUR  |         |          |     2.62 |     2.40 |     2.73 |
--------------------------------------------------------------------------------


FORMULAE FOR FINANCIAL INDICATORS                                               

Average number of employees:                                                    

Average of the number of personnel at the end of each month. The calculation has
been adjusted for part-time employees.                                          

Equity ratio, %:                                                                

Shareholders' equity + minority interest                                        
----------------------------------------                                        
Balance sheet total - advance payments received * 100                           

Earnings per share:                                                             

Profit before taxes - taxes (incl. change in deferred taxes) -/+ minority       
interest                                                                        
------------------------------------------------------------------------------  
Average number of shares during the accounting period, adjusted for share issues

Equity per share:                                                               

Capital and reserves                                                            
----------------------------------------------                                  
Number of shares on the balance sheet date, adjusted for share issues           

--------------------------------------------------------------------------------
| ORDER INTAKE, MEUR     |         |          |   1-9/08 |   1-9/07 |  1-12/07 |
--------------------------------------------------------------------------------
| Ponsse Group           |         |          |    167.2 |    235.7 |    361.2 |
--------------------------------------------------------------------------------


This interim report has been prepared in accordance with the IFRS recognition   
and measurement principles; however, it does not comply with all of the         
requirements of IAS 34.                                                         

The accounting policies for the interim report are compatible with those for the
financial statements prepared on 31 December 2007.                              

The above figures have not been audited.                                        

The above figures have been rounded and may therefore differ from those given in
the official financial statements.                                              


Vieremä 28 October 2008                                                         

Juho Nummela                                                                    
President and CEO                                                               

Mikko Paananen                                                                  
CFO                                                                             


FURTHER INFORMATION                                                             
Juho Nummela, President and CEO, tel. +358 20 768 8914 or +358 400 495 690      
Mikko Paananen, CFO, tel. +358 20 768 8648 or +358 400 817 036                  

DISTRIBUTION                                                                    
NASDAQ OMX Helsinki Ltd                                                         
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www.ponsse.com

pone1808.pdf