2009-05-07 07:00:00 CEST
2009-05-07 07:00:18 CEST
REGULATED INFORMATION
Nokian Renkaat - Interim report (Q1 and Q3)
INTERIM REPORT FOR NOKIAN TYRES PLC JANUARY-MARCH 2009
Nokian Tyres plc Interim Report 7.5.2009 8.00 a.m.
INTERIM REPORT FOR NOKIAN TYRES PLC JANUARY-MARCH 2009
Sales and operating result down due to challenging markets and seasonality.
The Group's net sales decreased by 36.8% to EUR 155.6 million (EUR 246.3
million in Jan-March 2008). Operating result fell to EUR -2.7 million (EUR 54.4
million), while earnings per share decreased to EUR -0.08 (EUR 0.36).
The first quarter of 2009 is expected to be the weakest of the year for Nokian
Tyres. The company expects sales to increase clearly during the later quarters
due to seasonality. However, the net sales and operating result in the second
quarter and full year 2009 will be significantly lower than in 2008.
Key figures:
EUR million
Q1/09 Q1/08 Q2/08 Q3/08 Q4/08 2008
Net sales 155.6 246.3 284.0 282.8 267.7 1,080.9
Operating result -2.7 54.4 74.2 71.9 46.5 247.0
Result before tax -17.3 49.8 68.6 67.5 -12.2 173.8
Result for the period -10.4 45.1 54.0 52.4 -11.6 139.9
Earnings per share, EUR -0.08 0.36 0.43 0.42 -0.09 1.12
Equity ratio, % 55.6 62.9 54.8
Cash flow from operations, -96.0 -78.1 -68.6 -141.8 298.2 9.5
(Cash Flow II)
RONA, % (rolling 12 months) 15.3 24.4 20.5
Gearing, % 57.2 27.1 41.0
Kim Gran, President and CEO:
”Nokian Tyres' first quarter net sales went down to the level of the
corresponding period in 2006. Nokian Tyres did not make profit in the first
quarter due to low sales, operative streamlining measures, currency devaluation
on our main markets, and the seasonal weakening in our sales mix. We took
strong actions to adjust our preseason sales and production to the changed
market conditions.
Sales went down in line with the market, particularly in Russia, but we were
able to maintain our market shares in all core markets. In North America, our
sales grew significantly. The share of winter tyres in our sales was smaller
than in the previous year as we postponed deliveries towards the end of the
year.
In terms of production, we responded to the weakening demand already in late
2008. Most of the streamlining measures aiming at a lighter cost structure and
enhanced profitability took place during the first quarter of this year, and
their impact on our profitability will become evident in the second half of the
year. The Russian plant's share of our manufacture increased, which helps to
defend our profitability. The strong devaluation of currencies and measures to
limit currency related risks in our core market regions weakened our financial
performance in the first quarter. The deployed price increases and seasonal mix
improvement with higher share of winter tyres will improve average prices and
profits from the second quarter on.
A new Nordic studded tyre, the Nokian Hakkapeliitta 7, was launched during this
financial period, and its preseason sales were promising. Our summer tyres
gained good results with several test wins in international magazine tests,
which will enhance consumer sales.
In 2009, we will focus on improving cash flow by reducing stocks, receivables
and cutting investments. The strengthening of our distribution by expanding the
Vianor chain will continue. A strong distribution, good seasonal logistics and
new products will give us a good chance to strengthen our market leadership in
the core markets.”
Market situation
The recession in key markets resulted in a clear decrease in car sales and
machine manufacture. The global downtrend in the demand for tyres that started
in late 2008, was further escalated during the review period. The after market
sales for passenger car tyres declined in the Nordic countries and elsewhere in
Europe. Tyre deliveries shrank drastically in Russia and the CIS countries,
trailing the declining car sales.
As car manufacture volumes decreased significantly, there was an excess supply
of summer tyres. The truck tyre market declined, and the demand for special
heavy tyres shrank down to one-half of the previous year's level.
Tyre manufacturers implemented significant price increases in order to offset
the currency devaluation in Russia, the Ukraine, Sweden and Norway.
The economy in Nokian Tyres' main markets - in the Nordic countries, Russia and
the CIS countries - is declining, and GNP is estimated to fall in 2009. New car
sales are estimated to go down 30-45%. Tyre sales volumes are expected to
decrease in line with car sales in Russia and slightly less in the Nordic
countries. The demand and price levels of winter tyres are expected to remain
better than the general market development. Winter tyre preseason deliveries
will take place much later than last year, closer to the seasonal consumer
sales.
NET SALES AND RESULT
In the period January to March 2009, Nokian Tyres Group recorded net sales of
EUR 155.6 million (EUR 246.3 million), showing a decrease of 36.8% on the
corresponding period a year earlier. Compared with the previous year, the
Group's net sales decreased by 27.1% in the Nordic countries, by 57.3% in
Russia and the CIS countries and by 19.7% in Other Europe. In North America
sales increased by 26.2%.
Raw material costs in manufacturing increased by 17 % in the first quarter
compared to the corresponding period a year earlier.
At EUR 71.3 million (EUR 73.4 million), fixed costs accounted for 45.8% (29.8%)
of net sales. Total salaries and wages were EUR 32.9 million (EUR 42.5 million)
representing a saving of EUR 9.6 million year-over-year.
Nokian Tyres Group's operating result fell to EUR -2.7 million (EUR 54.4
million). In compliance with IFRS 2, operating result was burdened by an
non-cash option scheme write-off of EUR 3.3 million (EUR 4.2 million).
Net financial expenses were EUR -14.6 million (EUR 4.6 million). Financial
expenses include EUR 1.8 million in calculatory non-cash expenses related to
convertible bonds. Net financial expenses contain EUR -10.3 million (EUR -2.0
million) of exchange rate differences. Since 1.1.2009 exchange rate differences
contain interest rate differential from foreign currency derivatives.
Comparison information is modified accordingly.
Result before tax was EUR -17.3 million (EUR 49.8 million). Result for the
period amounted to EUR -10.4 million (EUR 45.1 million) and EPS was EUR -0.08
(EUR 0.36).
The return on net assets (RONA, rolling 12 months) was 15.3% (24.4%). Income
financing after the change in working capital, investments and the disposal of
fixed assets (cash flow II) was EUR -96.0 million (EUR -78.1 million). Equity
ratio was 55.6% (62.9%).
The Group employed an average of 3,679 (3,661) people, and 3,656 (3,706) at the
end of the period. The Vianor tyre chain had 1,396 (1,461) employees at the end
of the period. The number of employees in Russia increased to 676 (521).
Tax rate
The Group's tax rate is effected by tax relieves in Russia. The tax relieves
are valid for as long as the company accrues tax on yields corresponding to the
amount of the Russian investment, and for two years thereafter.
The Group anticipates the tax rate on the entire year 2009 to remain at
previous year's level or increase slightly due to a lower share of taxable
profit made in Russia.
PASSENGER CAR TYRES
Q1/09 Q1/08 Change,% Q2/08 Q3/08 Q4/08 2008
Net sales,
EUR million 117.4 190.1 -38.2 195.6 212.1 143.9 741.6
Operating result,
EUR million 16.0 65.0 -75.4 63.8 72.9 28.4 230.0
Operating result,% 13.6 34.2 32.6 34.4 19.7 31.0
RONA,% 19.8 33.6 26.6
(rolling 12 months)
The net sales from Nokian passenger car tyres were down by 38.2% on the
previous year to EUR 117.4 million (EUR 190.1 million). Operating result
amounted to EUR 16.0 million (EUR 65.0 million) and the operating result
percentage was 13.6% (34.2%).
Sales decreased in line with the tyre market development and Nokian Tyres was
able to maintain its market shares in the core markets. The market shares
improved in Sweden. Nokian Tyres' sales increased in North America and
Switzerland.
The deployed streamlining measures, a sales mix clearly weaker than year
before, as well as the later timing of both summer and winter tyre sales
seasons affected the financial performance in the review period. The currency
devaluation in core markets in the latter part of 2008 weakened profits. In
order to compensate for this, price increases were implemented in this review
period. The average prices were however lower than in the previous year.
Raw material costs remained high in the review period due to the use of
deliveries and stock lots purchased earlier at higher prices. The decreasing
raw material prices and the increased proportion of less expensive production
in Russia were not yet fully reflected in the financial result; they will
become evident gradually during 2009.
Actions to adjust production and inventory levels were implemented in the
review period and the process will continue until the demand recovers.
Maintaining tyre price levels and controlling the receivables are key
objectives for the rest of the year. The cash flow in 2009 will be improved by
restructuring of operations, personnel adjustments, investment cuts and
cost-cutting programme including all cost types.
A new Nordic studded tyre, the Nokian Hakkapeliitta 7, was launched in January,
and the amount of pre-orders has been promising. Nokian Tyres products achieved
several significant top positions in industry magazines' summer tyre tests both
in Central Europe and in Russia.
HEAVY TYRES
Q1/09 Q1/08 Change,% Q2/08 Q3/08 Q4/08 2008
Net sales,
EUR million 12.6 27.9 -54.9 25.5 24.4 19.9 97.7
Operating result,
EUR million -2.2 6.3 -134.3 5.1 4.1 2.2 17.7
Operating result,% -17.3 22.7 19.8 16.7 11.1 18.1
RONA,% 13.5 38.1 25.9
(rolling 12 months)
The net sales of Nokian Heavy Tyres totalled EUR 12.6 million (EUR 27.9
million), showing a decrease of 54.9% on the corresponding period of the
previous year. Operating result was down, totalling EUR -2.2 million (EUR 6.3
million) and the operating result percentage was -17.3% (22.7%).
The financial performance suffered from weakened sales and drastic production
streamlining measures taken due to high stock levels.
Heavy tyres sales decreased in all product categories in the first quarter of
this year. Low machine manufacture volumes affected the demand for forestry
tyres in particular. The demand for harbour and mining tyres, as well as for
various special machinery tyres, was weak due to the global economic recession.
The demand for special tyres decreased more than 50% from the previous year and
remains weak.
The production streamlining measures that were initiated late last year, in
order to adjust production to demand, will continue. The aim is to reduce stock
levels by 50% by the end of this year. In 2009 focus will be on bringing in new
customers, speeding up the development process for new products as well as
launching new logistics and customer service concepts.
VIANOR
Q1/09 Q1/08 Change,% Q2/08 Q3/08 Q4/08 2008
Net sales,
EUR million 40.3 46.7 -13.6 80.6 64.5 116.5 308.3
Operating result,
EUR million -11.6 -10.4 -12.3 5.9 -2.2 11.1 4.4
Operating result,% -28.9 -22.2 7.3 -3.4 9.6 1.4
RONA,% 2.2 2.6 3.0
(rolling 12 months)
Vianor's net sales were EUR 40.3 million (EUR 46.7 million), a decrease of
13.6% on the corresponding period of the previous year. Operating result
amounted to EUR -11.6 million (EUR -10.4 million), expressed as a percentage
-28.9% (-22.2%).
The spring season of summer tyre sales and the related service sales in the
Nordic countries and Russia were delayed to the second quarter of the year, due
to the prolonged winter and seasonal timing. Vianor's sales and profits for the
first quarter decreased, but Vianor's market shares in the core market areas
are estimated to be better than last year. The most successful country
organisations were Vianor USA and Vianor Switzerland that generated good net
sales growth.
Vianor continued its cost adjustment measures, which included shutting down
non-profitable outlets, making personnel cuts and reducing stock levels. Most
of these savings will be realised in the latter half of the year. In 2009 focus
will be on active sales, defending of market shares and tyre prices as well as
implementing restructuring operations and cost-saving programmes.
The network expansion proceeded according to plan. At the end of the review
period, the Vianor network comprised 520 outlets in 15 countries in the Nordic
countries, Russia, the Ukraine, Kazakhstan, Armenia, the Baltic countries, the
USA and Central Europe. The network grew with 13 new outlets during the review
period. Of these, 340 were partner and franchising outlets. Expanding the
partner network will continue in 2009 according to earlier plans.
OTHER OPERATIONS
Truck Tyres
The net sales of Nokian truck tyres were EUR 4.3 million (EUR 4.9 million),
down 12.1% from the previous year. The European markets declined more than 30%.
Sales were also expanded to new market regions in Eastern Europe. Contract
manufacturing was reduced and the inventory levels declined.
The truck tyre product range mainly consists of winter products, which do not
sell very well at the beginning of the year due to the seasonal nature of
operations. The new products launched in the first quarter will expand sales
opportunities. Lower raw material prices are expected to gradually improve
profitability during the rest of the year.
RUSSIA AND THE CIS COUNTRIES
Nokian Tyres' sales in Russia and the CIS countries totalled EUR 48.8 million
(EUR 114.2 million) in the review period. This entails a 57.3% decrease from
the previous year. Nokian Tyres' market shares remained at the previous year's
level. The distribution network was extended by signing additional distribution
agreements and expanding the Vianor network. There were 268 Vianor franchising
outlets in Russia and the other CIS countries at the end of the review period.
Nokian Tyres had clear market and price leadership in the core product
categories in Russia. The Nokian Tyres plant located in Russia, inside the
customs borders, provide a significant competitive edge on the market. The
seven production lines of the Russian plant were operating with limited
capacity in line with the weakened demand. New mixing machines were installed,
and a storage extension was taken in use during the review period. The fully
completed production process creates logistics and raw material cost savings
compared to 2008. The Hakkapeliitta Village construction continued.
INVESTMENTS
Investments during the period under review amounted to EUR 35.6 million (EUR
42.7 million). The company's total investments in 2009 will be approximately
EUR 85 million (EUR 181.2 million), and some EUR 50 million (EUR 121 million)
will be spent on completing projects started in 2008 concerning the Russian
plant's operations and extension. The remainder comprises production
investments in the Nokia plant, moulds for new products and the Vianor
expansion projects.
OTHER MATTERS
1. Stock options on the NASDAQ OMX Helsinki Stock Exchange
The Board of Directors of Nokian Tyres plc resolved to apply for listing of the
stock options 2007A on the NASDAQ OMX Helsinki Ltd so that the listing would
commence on 1 March 2009.
The total number of stock options 2007A is 2,250,000. Each stock option 2007A
entitles its holder to subscribe for one Nokian Tyres plc share. The shares can
be subscribed with the stock options 2007A during 1 March 2009 - 31 March 2011.
In the aggregate, the stock options 2007A entitle their holders to subscribe
for 2,250,000 shares. The present share subscription price with stock options
2007A is EUR 16,48/share. The dividends payable annually will be deducted from
the share subscription price.
2. Shares subscribed with option rights
After December 9, 2008 registered increase in share capital a total of 400
Nokian Tyres plc's shares have been subscribed with the 2004B option rights and
200 shares with 2004C option rights. These option rights are attached to the
Nokian Tyres plc's Option Programs of 2004. An increase in share capital
totalling 120 euros was entered into the Trade Register on February 25, 2009.
The shares are traded on the Nasdaq OMX Helsinki Ltd together with the old
shares as of February 26, 2009. After the increase, the number of Nokian Tyres
shares is 124,846,590 and the share capital is EUR 24,969,318.
3. Share price development
The Nokian Tyres' share price was EUR 8.84 at the end of the review period (EUR
27.00). The average share price during the period was EUR 8.87 (EUR 24.57), the
highest EUR 11.08 (EUR 28.44) and the lowest EUR 7.00 (EUR 19.04). A total of
71,547,871 shares were traded during the period (63,395,294), representing 57%
(51%) of the company's overall share capital. The company's market value at the
end of the period amounted EUR 1,104 billion (EUR 3,365 billion). The company's
percentage of Finnish shareholders was 40% (26%) and 60% (74%) were foreign
shareholders registered in the nominee register. This figure includes
Bridgestone's ownership of approximately 16%.
4. Decisions made at the Annual General Meeting
The Annual General Meeting of Nokian Tyres held on 2 April 2009 accepted the
profit and loss statement for 2008 and discharged the Board of Directors and
the President from liability. The final dividend was set at EUR 0.40 per share.
The matching date was 7 April 2009 and the payment date 21 April 2009.
4.1 Board of Directors and auditor
The number of Board members was set at seven. Kim Gran, Hille Korhonen, Hannu
Penttilä, Aleksey Vlasov, Petteri Walldén and Kai Öistämö will continue as
Board members. Yasuhiko Tanokashira was elected as a new member of the Board.
In a meeting held after the Annual General Meeting, Petteri Walldén was elected
Chairman of the Board. Authorised public accountants KPMG Oy Ab continue as
auditors.
4.2 Remuneration of the Board members
The Annual General Meeting decided that the monthly fee paid to the Chairman of
the Board would be EUR 5,833, or EUR 70,000 per year, while that paid to Board
members was set at EUR 2,917 or EUR 35,000 per year. It was also decided that
each member of the Committee will receive a meeting fee of EUR 500 for each
Committee meeting attended.
In addition, it was decided that, according to the existing practices, 60% of
the annual fee be paid in cash and 40% in company shares, such that in the
period from 3 April to 30 April 2009, EUR 28,000 worth of Nokian Tyres plc
shares will be purchased at the stock exchange on behalf of the Chairman of the
Board and EUR 14,000 worth of shares on behalf of each Board member. This
decision means that the final remuneration paid to Board members is tied to the
company's share performance. No separate compensation will be paid to the
President and CEO for Board work.
5. Adjustment measures and cost-cutting programme
At the turn of the year, Nokian Tyres initiated measures to adjust its
production and structure, the goal being to improve productivity and achieve
annual cost savings of approximately EUR 50 million. The company informed about
the statutory negotiations decisions related to adjustment issues in stock
exchange releases on November 19 and December 19, 2008, as well as January 20
and March 9, 2009.
The production of Nokia plant was changed from a continuous three-shift
seven-days model to a five-day (discontinued) three-shift model. As a result of
the adjustments, the annual production volume of Nokian passenger car tyres at
the Nokia plant will decrease from the previous 6 million to 4 million tyres in
2009.
In the review period the total group personnel was cut by approximately 470
employees. Lay-offs were carried out in all business units according to the
cost-cutting programme.
RISKS, UNCERTAINTY FACTORS AND DISPUTES IN THE NEAR FUTURE
The Group's short term risks are derived from continuing uncertainty of the
world economy and the impact on the tyre markets. A decrease in demand may have
a negative effect on sales volume and lead to decreasing profits.
In terms of exchange rate risks, the main risks facing Nokian Tyres in the near
future are related to the development of the Russian rouble, the Ukrainian
hryvnia and the Kazakhstanian tenge.
A little over 35% of the Group's net sales are generated from euro-denominated
sales. The most important sales currencies in addition to the euro are the
Russian rouble, the Ukrainian hryvnia, the US dollar, and the Swedish and
Norwegian krona.
Nokian Tyres' other risks and uncertainty factors in the near future have to do
with the shortage of financing for customers in Russia and Ukraine, the success
of sales in the key markets, the repatriation of receivables and the
development of the financial markets. Russian receivables account for around
half of the Group's total receivables. Special attention has been drawn to
securing customer payments.
Nokian Tyres has certain pending legal proceedings and litigations in some
countries. At this moment, the company does not expect these proceedings to
have any material impact on the performance or future outlook.
OUTLOOK FOR 2009
The global recession is expected to have a widespread negative impact on demand
for tyres. Financing has become scarcer, making business more challenging to
tyre distributors. The clear drop in new car sales in all market areas, will
reduce the demand for tyres. The manufacture of industrial machinery and
equipment will decrease considerably from the previous year.
Raw material prices will drop clearly, and the resulting savings will take
effect from the second quarter and full effect from the third quarter. As for
all of 2009, the average price of raw materials is expected to decrease clearly
year-over-year.
The last six months of the year, and especially the fourth quarter, have
traditionally had the biggest impact on the sales and performance of Nokian
Tyres, due to the seasonal nature of operations and the high share of winter
tyres. In 2009, the timing of sales is expected to revert to the traditional
model with preseason winter tyre sales being done later than in 2008.
The defence of profitability at Nokian Tyres will be supported by the
increasing share of Russian manufacture, structural changes and the
cost-cutting measures that affect all Group operations. The benefits of
restructuring are gradually impacting results with full effect during the
second half of the year. Sales prices have been increased in Russia, CIS and
Scandinavia to offset changes in exchange rates.
Nokian Tyres has good opportunities to improve cash flow, boost its market
position, increase market shares and return to a growth path as soon as the
economic business environment stabilises. The company has a strong balance
sheet and good profitability over the full year. Its product range includes
several new products, and its distribution network is robust in the key
markets. Own production inside the Russian and CIS countries' customs barriers
further strengthens the company's position.
The financial crisis makes it difficult to draw up precise forecasts for demand
in the tyre market in 2009. The first quarter of 2009 is expected to be the
weakest of the year for Nokian Tyres. The company expects sales to increase
clearly during the later quarters due to seasonality. However, the net sales
and operating result in the second quarter and full year 2009 will be
significantly lower than in 2008.
Previous guidance from April 2, 2009:
The first quarter will remain clearly the weakest quarter of the year. Nokian
Tyres' sales will increase clearly during the other quarters compared to the
first quarter, but the full year net sales in 2009 will be weaker than in 2008.
This interim report has been prepared in accordance with IFRS
compliant recognition and measurement principles. Since 1.1.2009
the Group has applied amendment to the IAS 1 'Presentation of
Financial Statements' affecting the disclosure of the consolidated
income statement and statement of changes in equity. In addition,
the Group has adopted new IFRS 8 'Operating Segments' affecting the
disclosure of the notes to the consolidated financial statements.
Otherwise this interim report has been prepared in accordance with
the same accounting policies as in the most recent annual financial
statements, but it has not been prepared in compliance with all
requirements set out in IAS 34 'Interim Financial Reporting'.
The interim report figures are unaudited.
NOKIAN TYRES
CONSOLIDATED INCOME STATEMENT 1-3/09 1-3/08 Last 12 1-12/08 Change
Million euros months %
Net sales 155.6 246.3 990.2 1,080.9 -36.8
Cost of sales -102.6 -133.4 -557.4 -588.1 -23.0
Gross profit 53.0 112.9 432.8 492.7 -53.1
Other operating income 0.4 0.3 2.3 2.2 29.7
Selling and marketing
expenses -43.9 -47.8 -194.8 -198.8 -8.3
Administration expenses -6.7 -6.1 -28.0 -27.4 9.8
Other operating expenses -5.5 -4.9 -22.4 -21.8 13.2
Operating result -2.7 54.4 189.8 247.0 -105.0
Financial income 62.3 19.0 154.5 111.1 228.6
Financial expenses -76.9 -23.6 -237.7 -184.3 226.5
Result before tax -17.3 49.8 106.6 173.8 -134.8
Tax expense (1 6.9 -4.7 -22.2 -33.9 -247.1
Result for the period -10.4 45.1 84.4 139.9 -123.0
Attributable to:
Equity holders of the parent -10.4 45.1 84.4 139.9
Minority interest 0.0 0.0 0.0 0.0
Earnings per share from the
result attributable to equity
holders of the parent
basic, euros -0.08 0.36 0.68 1.12 -122.9
diluted. euros -0.07 0.35 0.68 1.10 -119.9
CONSOLIDATED OTHER
COMPREHENSIVE INCOME 1-3/09 1-3/08 1-12/08
Million euros
Result for the period -10.4 45.1 139.9
Other comprehensive income,
net of tax:
Gains/Losses from hedge
of net investments in foreign
operations -5.1 4.4 6.2
Interest rate swaps 0.0 0.1 -0.1
Translation differences
on foreign operations (2 -34.0 -12.4 -46.4
Total other comprehensive
income for the period,
net of tax -39.2 -7.8 -40.3
Total comprehensive income
for the period -49.6 37.3 99.6
Total comprehensive income
attributable to:
Equity holders of the parent -49.6 37.3 99.6
Minority interest 0.0 0.0 0.0
1)Tax expense in the consolidated income statement is based on the
taxable result for the period.
2)Since the beginning of this year the Group has internal loans that
are recognised as net investments in foreign operations in accordance
with IAS 21 'The Effects of Changes in Foreign Exchange Rates'.
KEY RATIOS 31.3.09 31.3.08 31.12.08 Change
%
Equity ratio, % 55.6 62.9 54.8
Gearing, % 57.2 27.1 41.0
Equity per share, euro 5.84 6.10 6.20 -4.3
Interest-bearing net debt,
mill. euros 417.5 206.5 319.0
Capital expenditure,
mill. euros 35.6 42.7 181.2
Depreciation, mill. euros 15.4 12.9 56.2
Personnel, average 3,679 3,661 3,812
Number of shares (million units)
at the end of period 124.85 124.63 124.85
in average 124.85 124.06 124.61
in average, diluted 128.85 131.83 131.47
CONSOLIDATED STATEMENT OF
FINANCIAL POSITION 31.3.09 31.3.08 31.12.08
Million euros
Non-current assets
Property, plant and equipment 492.2 447.0 499.8
Goodwill 54.2 52.6 53.9
Other intangible assets 20.6 7.5 19.0
Investments in associates 0.1 0.1 0.1
Available-for-sale
financial assets 0.2 0.3 0.2
Other receivables 10.4 12.3 11.6
Deferred tax assets 30.6 20.3 20.3
Total non-current assets 608.2 540.0 604.9
Current assets
Inventories 299.8 219.3 290.9
Trade receivables 273.0 322.3 268.4
Other receivables 112.6 71.8 143.0
Cash and cash equivalents 20.7 58.9 113.2
Total current assets 706.1 672.3 815.5
Equity
Share capital 25.0 25.0 25.0
Share premium 155.2 154.9 155.2
Translation reserve -92.1 -20.8 -53.0
Fair value and hedging reserves -0.2 0.0 -0.1
Retained earnings 641.5 601.7 647.6
Minority interest 0.4 0.0 2.7
Total equity 729.8 760.9 777.3
Non-current liabilities
Deferred tax liabilities 26.7 28.4 27.6
Provisions 1.2 - 1.1
Interest bearing liabilities 310.2 250.8 394.5
Other liabilities 2.1 2.3 2.1
Total non-current liabilities 340.2 281.5 425.3
Current liabilities
Trade and other payables 115.2 154.2 178.9
Provisions 1.1 1.1 1.1
Interest-bearing liabilities 128.0 14.7 37.8
Total current liabilities 244.3 170.0 217.8
Total assets 1,314.4 1,212.3 1,420.4
CONSOLIDATED STATEMENT OF
CASH FLOWS 1-3/09 1-3/08 1-12/08
Million euros
Cash flows from operating
activities:
Cash generated from
operations -69.9 -26.1 201.1
Financial items and taxes 8.2 -37.6 -182.7
Net cash from operating
activities -61.7 -63.8 18.4
Cash flows from investing
activities:
Net cash used in investing
activities -35.5 -46.1 -177.2
Cash flows from financing
activities:
Proceeds from issue of share
capital 0.0 6.1 6.4
Change in current financial
receivables and debt 87.8 2.2 25.1
Change in non-current financial
receivables and debt -82.7 3.0 147.5
Dividends paid 0.0 0.0 -62.3
Net cash from financing
activities 5.1 11.3 116.7
Net change in cash and cash
equivalents -92.1 -98.5 -42.1
Cash and cash equivalents at
the beginning of the period 113.2 158.1 158.1
Effect of exchange rate changes 0.4 0.6 2.8
Cash and cash equivalents at
the end of the period 20.7 58.9 113.2
-92.1 -98.5 -42.1
The effect of exchange rate changes EUR 0.4 million is included
in the net cash from operating activities. In 2008 that effect
was EUR 0.6 million.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Million euros
Fair
value
Trans- and rity
Share Share lation hedging Retained inte-
capital premium reserve reserves earnings rest Tot
Equity,
Jan 1st 2008 24.7 149.0 -12.8 0.0 551.9 0.0 712.8
Exercised
warrants 0.2 5.9 6.1
Share-based
payments 4.2 4.2
Other changes 0.3 0.3
Total compre-
hensive income
for the period -7.9 0.1 45.1 37.3
Change in
minority interest 0.0
Equity,
Mar 31st 2008 25.0 154.9 -20.8 0.2 601.7 0.0 760.9
Equity,
Jan 1st 2009 25.0 155.2 -53.0 -0.1 647.6 2.7 777.3
Exercised
warrants 0.0 0.0 0.0
Share-based
payments 3.3 3.3
Other changes 0.9 0.9
Total compre-
hensive income
for the period -39.1 0.0 -10.4 0.0 -49.6
Change in
minority interest -2.3 -2.3
Equity,
Mar 31st 2009 25.0 155.2 -92.1 -0.2 641.5 0.4 729.8
SEGMENT INFORMATION
The segment information is reported according to the business
segments. Segments are based on the internal profit centre
organisation and financial reporting structure. The segments comprise
of entities with products and services subject to marketing
strategies, distribution channels, risks and returns that are
different from those of other segments. They are also managed
separately.
Application of IFRS 8 has not changed the reported business segments
of the Group as the segment information has been based on financial
reporting structure also before where the measurement principles are
in accordance with IFRS standards.
Pricing of the inter-segment transactions reflect current market
prices. Evaluation of profitability and decisions on resource
allocation are based on operating result of each segment.
Segments are:
Passenger Car Tyres -profit centre develops, produces and obtains
revenues from sales of summer and winter tyres for cars and vans.
Heavy Tyres -profit centre obtains its revenues from tyres for
forestry machinery, special tyres for agricultural machinery and
industrial machinery.
Vianor -tyre chain sells car and van tyres, truck tyres as well as
other automotive products and services. In addition to Nokian brand,
Vianor sells also other leading tyre brands.
Other operations include Truck Tyre business. In addition, Other
operations contain business development and Group management
unallocated to the segments.
Million euros 1-3/09 1-3/08 1-12/08 Change
%
Net sales
Passenger car tyres 117.4 190.1 741.6 -38.2
Heavy tyres 12.6 27.9 97.7 -54.9
Vianor 40.3 46.7 308.3 -13.6
Other operations 4.3 4.9 33.4 -12.1
Eliminations -19.1 -23.3 -100.2 18.3
Total 155.6 246.3 1,080.9 -36.8
Operating result
Passenger car tyres 16.0 65.0 230.0 -75.4
Heavy tyres -2.2 6.3 17.7 -134.3
Vianor -11.6 -10.4 4.4 -12.3
Other operations -2.7 -2.4 -6.4 -9.8
Eliminations -2.3 -4.1 1.2 45.0
Total -2.7 54.4 247.0 -105.0
Operating result,
% of net sales
Passenger car tyres 13.6 34.2 31.0
Heavy tyres -17.3 22.7 18.1
Vianor -28.9 -22.2 1.4
Total -1.8 22.1 22.8
Cash Flow II
Passenger car tyres -76.1 -44.4 -2.3 -71.2
Heavy tyres -4.8 -6.6 10.6 27.6
Vianor -14.4 -12.9 1.4 -12.2
Total -96.0 -78.1 9.5 -22.9
CONTINGENT LIABILITIES 31.3.09 31.3.08 31.12.08
Million euros
FOR OWN DEBT
Mortgages 0.9 1.0 0.9
Pledged assets 34.3 41.6 37.4
OTHER OWN COMMITMENTS
Guarantees 2.1 1.4 2.1
Leasing and rent commitments 114.0 93.7 104.9
Acquisition commitments 1.5 27.1 1.5
DERIVATIVES 31.3.09 31.3.08 31.12.08
Million euros
INTEREST RATE DERIVATIVES
Interest rate swaps
Notional amount 14.3 14.9 14.4
Fair value -0.3 0.0 -0.1
FOREIGN CURRENCY DERIVATIVES
Currency forwards
Notional amount 340.5 395.8 396.5
Fair value -3.4 7.1 24.4
Currency options, purchased
Notional amount 29.9 23.5 5.0
Fair value 0.5 0.5 0.5
Currency options, written
Notional amount 59.9 23.5 10.1
Fair value -0.7 -0.2 -0.3
The fair value of interest rate derivatives is defined by cash flows
due to contracts. Interest rate swaps are wholly designated as cash
flow hedges and their changes in fair value relating to the effective
portion of the hedge are recognised in equity and the potential
ineffective portion is recognised in the income statement.
The fair value of forward exchange contracts is calculated at the
forward rates on the reporting date on the basis of cash flows
arising from contracts. The fair value of currency options is
calculated using the Garman-Kohlhagen option valuation model.
Foreign currency derivatives are only used to hedge the Group's net
exposure. The changes in fair value of foreign currency derivatives
are reported in the income statement excluding the foreign currency
derivatives that are hedging the foreign currency denominated net
investment in a foreign subsidiary. Hedge accounting is applied for
those hedges and for hedges meeting the hedge accounting criteria the
changes in fair value are wholly deferred in equity except for the
potential ineffective portion and the time value of currency options,
which are recognised in the income statement.
The notional amount of foreign currency derivatives is the euro
equivalent of the contracts' currency denominated amount on the
reporting date.
Nokian Tyres plc
Anssi Mäki
Communications Manager
Further information: Mr. Kim Gran, President and CEO,
Tel: +358 10 401 7336
Distribution: NASDAQ OMX and major media
***
Nokian Tyres plc will publish the interim report January-March on Thursday May
7, 2009 at 8.00 am Finnish time.
The result presentation to analysts and media will be held in Helsinki at 10.00
am Finnish time. The presentation can be listened through audiocast via
internet at http://www.nokiantyres.com/resultinfo2009q1
To be able to ask questions during the event you can participate in the
conference call. Please dial in 5-10 minutes before the beginning of the event:
+44 (0)20 7162 0025
Password: Nokian Tyres
Stock exchange release and presentation material will be available before the
event from http://www.nokiantyres.com/ir-calendar
After the event the audio recording can be downloaded from the same page.
Nokian Tyres January-June 2009 result will be published on August 6, 2009.
Releases and company information will be found from Internet
www.nokiantyres.com
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