2007-11-01 08:00:28 CET
2007-11-01 08:00:28 CET
REGULATED INFORMATION
Honkarakenne Oyj - Quarterly report
Interim report 1 January - 30 September 2007
The January - September net sales of Honkarakenne Group amounted to EUR 71.2 million, which is EUR 10.7 million higher than last year. Income before tax showed a profit of EUR 3.4 million, i.e. it increased by EUR 5.9 million. The equity ratio increased to 41.0% and investments made in January-September grew to EUR 2.1 million. In addition to normal seasonal changes, the favorable profit development of the review period was affected by the increased net sales in Finland and other main market areas, good utilization rates at the factories, improved raw material use, more efficient operations, and lower overhead expenses. The price of wood has increased very rapidly within the last 12 months, but the effect of increased sales prices on the profit could already be seen in the second and third quarter. Markets The January-September net sales increased by 18% over the corresponding period of the previous year. The net sales in Finland grew by 6% and exports by 27%. The exports accounted for 59% of net sales, whereas a year ago the corresponding figure was 54%. With regards to the Central European countries, the exports to France increased, but exports to Germany decreased. This was due to the VAT increase that came into force in Germany at the turn of the year, and the discontinuation of the subsidy targeted for people constructing their first home. With regards to the East European countries, exports to Russia developed exceptionally well, and the project delivery of 100 homes to Kazakhstan that began last fall was completed during the spring and summer. Measured in Euros, the exports to Japan decreased but when measured in Yen, the net sales remained at the same level as year before. Considering the overall market situation, the advance sales of the third quarter of the financial period were quite satisfactory. Honkarakenne Group's order book amounted to EUR 29.9 million (EUR 29.3 million) at the end of September. Nevertheless, the significant mark-ups required in all of the company's main market areas due to increased raw material prices have affected the consumers' purchase behavior; decision-making has been more careful and purchase decisions have been postponed especially in Finland. Generally speaking, however, the market situation has remained stable in all main market areas, except for Japan and Germany. The weakening of the Yen, combined with the sharp increase in the price of wood, has resulted in exceptionally high mark-ups in Japan, which has deteriorated Honkarakenne's competitiveness significantly during the last 12 months. The number of building licenses for single-family homes has collapsed in Germany this year, and despite the country's favorable economic development, the situation has not started to improve. The downtrend of the Finnish overall market of single-family homes continues for the second successive year, and this trend is expected to continue in the near future. The market for single-family log homes has, however, remained stable. The market for holiday houses s experiencing moderate growth in Finland. The price level of raw materials has reached its peak for this autumn, and the slight decrease in prices can already be seen on the market. The stumpage price is remains high, and there are no signs of any significant changes. Financing and investments The financial position of the company has remained good. The equity ratio improved and stood at 41.0% (36.8%), and interest-bearing net liabilities amounted to EUR 10.7 million (EUR 11.7 million). Liquid assets totaled EUR 2.5 million (EUR 3.9 million). Gearing stood at 53.5% (67.3%). Capital expenditure totaled EUR 2.1 million (EUR 1.9 million). Own shares Honkarakenne Oyj has repurchased 62,406 of its B shares during the period under review for an average price of EUR 5.70 per share. At the end of the review period the company held 90,950 of its B shares with a total nominal value of EUR 181,900 and a total purchase price of EUR 509,040.60. These shares represent 2.43% of the company's capital stock and 0.96% of the voting rights. The purchase cost has been deducted from shareholders' equity in the consolidated financial statements. The Board of Directors has been granted a share repurchase authorization, valid until 4 April 2008, to repurchase company shares for an amount equivalent to a maximum of 5% of the company's capital stock. The Board of Directors has also been granted authority, also valid until 4 April 2008, to dispose of 187,448 B shares. Future Outlook for the end of the year The excellent development both in net sales and profit in the first half will create great facilities to increase net sales and significantly improve the result of the whole year. The mark-ups and the results of the strengthening program, which was started in the spring, will have a positive effect on the profit. The general view of the industry is that the increase in the price of wood has reached its peak. The price of timber will probably remain higher than in the previous years, because the stumpage prices seem to remain high and there is pressure to raise the export duties on Russian raw wood. The market situation of the industry is believed to remain stable, if the positive general economic development continues in the main market areas of the company. The customers' decision-making process has been influenced by the uncertainty of the price development of wood. The situation is believed to normalize during the end of the year and the upcoming winter. General meeting and the schedule for financial reporting Honkarakenne Oyj's general meeting has been scheduled for 4 April 2008.The annual report and interim reports will be published in 2008 as follows: - annual report on 27 February 2008 - interim report for January-March on 7 May 2008 - interim report for January-June on 13 August 2008 - interim report for January-September on 5 November 2008 Events after the review period There have been no significant events after the review period. HONKARAKENNE OYJ Board of Directors DISTRIBUTION Helsinki Stock Exchange Principal media Financial supervision Further information: CEO and President Esko Teerikorpi, tel. +358 20 575 7816, +358 400 580 6111, esko.teerikorpi@honka.com. This and previous press releases can be found on the company's website at www.honka.com, Investors. -------------------------------------------------------------------------------- | CONSOLIDATED INCOME | | | | | | | STATEMENT | | | | | | -------------------------------------------------------------------------------- | (unaudited) | 2007 | 2006 | 2007 | 2006 | 2006 | -------------------------------------------------------------------------------- | (MEUR) | 7-9 | 7-9 | 1-9 | 1-9 | 1-12 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Net sales | 24.0 | 24.8 | 71.2 | 60.5 | 84.9 | -------------------------------------------------------------------------------- | Change in inventories | -1.1 | -2.1 | 2.0 | 0.4 | -1.6 | -------------------------------------------------------------------------------- | Production for own | 0.1 | 0.0 | 0.6 | 0.1 | 0.2 | | use | | | | | | -------------------------------------------------------------------------------- | Other operating | 0.4 | 0.3 | 1.3 | 1.2 | 2.0 | | income | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Materials and | 13.7 | 14.1 | 45.5 | 38.0 | 51.3 | | services | | | | | | -------------------------------------------------------------------------------- | Staff costs | 4.6 | 3.9 | 13.6 | 12.3 | 16.6 | -------------------------------------------------------------------------------- | Depreciations | 0.9 | 1.0 | 2.8 | 3.2 | 4.0 | -------------------------------------------------------------------------------- | Other operating | 2.6 | 3.3 | 9.3 | 10.7 | 14.7 | | expenses | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Operating profit/loss | 1.5 | 0.7 | 3.8 | -2.0 | -1.3 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Financial income and | -0.1 | -0.1 | -0.4 | -0.4 | -0.5 | | expenses | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Profit/loss before | 1.4 | 0.6 | 3.4 | -2.5 | -1.8 | | taxes | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Taxes | -0.4 | 0.1 | -0.8 | 0.6 | 0.2 | -------------------------------------------------------------------------------- | Minority share | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Profit/loss for the | 1.1 | 0.7 | 2.6 | -1.9 | -1.6 | | period | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Earnings/share (EPS), | | | | | | | EUR | | | | | | -------------------------------------------------------------------------------- | Basic | 0.29 | 0.16 | 0.70 | -0.50 | -0.42 | -------------------------------------------------------------------------------- | Diluted | 0.29 | 0.16 | 0.70 | -0.50 | -0.42 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | CONSOLIDATED BALANCE | | | | | | | SHEET | | | | | | -------------------------------------------------------------------------------- | (unaudited) | | | | | | -------------------------------------------------------------------------------- | (MEUR) | 30.9.-07 | 31.12.-06 | 30.9.-06| | | | | | | | | | -------------------------------------------------------------------------------- | Assets | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Non-current assets | | | | | | -------------------------------------------------------------------------------- | - Intangible assets | 1.2 | 1.3 | 1.2 | | | -------------------------------------------------------------------------------- | - Tangible assets | 24.5 | 25.4 | 25.8 | | | -------------------------------------------------------------------------------- | - Loans and other | 0.2 | 0.9 | 1.2 | | | | receivables | | | | | | -------------------------------------------------------------------------------- | - Deferred tax assets | 1.6 | 1.3 | 1.6 | | | -------------------------------------------------------------------------------- | - Investments | 0.9 | 0.7 | 0.7 | | | -------------------------------------------------------------------------------- | Total | 28.4 | 29.6 | 30.5 | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Current assets | | | | | | -------------------------------------------------------------------------------- | - Inventories | 17.0 | 15.7 | 15.4 | | | -------------------------------------------------------------------------------- | - receivables | 10.7 | 9.4 | 12.0 | | | -------------------------------------------------------------------------------- | - Cash and bank | 2.5 | 4.1 | 3.9 | | | | receivables | | | | | | -------------------------------------------------------------------------------- | Total | 30.2 | 29.2 | 31.3 | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Total assets | 58.6 | 58.8 | 61.8 | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Shareholders' equity | | | | | | | and liabilities | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Capital stock | 7.5 | 7.5 | 7.5 | | | -------------------------------------------------------------------------------- | Other capital and | 12.5 | 10.1 | 9.8 | | | | reserves | | | | | | -------------------------------------------------------------------------------- | Total | 20.0 | 17.6 | 17.3 | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Minority share | 0.0 | 0.0 | 0.0 | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Long-term liabilities | | | | | | -------------------------------------------------------------------------------- | Loans | 10.6 | 11.9 | 14.9 | | | -------------------------------------------------------------------------------- | Deferred tax | 1.3 | 1.3 | 1.3 | | | | liabilities | | | | | | -------------------------------------------------------------------------------- | Provisions | 0.4 | 0.2 | 0.2 | | | -------------------------------------------------------------------------------- | Other liabilities | 0.0 | 0.0 | 0.0 | | | -------------------------------------------------------------------------------- | Total | 12.3 | 13.4 | 16.4 | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Short-term | | | | | | | liabilities | | | | | | -------------------------------------------------------------------------------- | Loans | 2.6 | 3.8 | 0.6 | | | -------------------------------------------------------------------------------- | Accounts payable and | 23.7 | 23.9 | 27.4 | | | | other liabilities | | | | | | -------------------------------------------------------------------------------- | Total | 26.3 | 27.7 | 28.0 | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Total shareholders' | 58.6 | 58.8 | 61.8 | | | | equity and | | | | | | | liabilities | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | STATEMENT OF CHANGES | | | | | | | IN SHAREHOLDERS' | | | | | | | EQUITY | | | | | | -------------------------------------------------------------------------------- | (unaudited) | | | | | | -------------------------------------------------------------------------------- | 1000 EUR | | | | | | -------------------------------------------------------------------------------- | | Share | Premium | Reserve | Retained | Total | -------------------------------------------------------------------------------- | | capital | fund | fund | earnings | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | 1.1.2006 | 7,498 | 520 | 5,316 | 5,959 | 19,293 | -------------------------------------------------------------------------------- | Translation | | | | -98 | -98 | | difference | | | | | | -------------------------------------------------------------------------------- | Result of the period | | | | -1,861 | -1,861 | -------------------------------------------------------------------------------- | Repurchase of own | | | | -4 | -4 | | shares | | | | | | -------------------------------------------------------------------------------- | 30.9.2006 | 7,498 | 520 | 5,316 | 3,996 | 17,330 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | 1.1.2007 | 7,498 | 520 | 5,316 | 4,308 | 17,642 | -------------------------------------------------------------------------------- | Translation | | | | 134 | 134 | | difference | | | | | | -------------------------------------------------------------------------------- | Repurchase of own | | | | -356 | -356 | | shares | | | | | | -------------------------------------------------------------------------------- | Result of the period | | | | 2,607 | 2,607 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | 30.9.2007 | 7,498 | 520 | 5,316 | 5,493 | 20,027 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | CONSOLIDATED CASH | | | | | | | FLOW STATEMENT | | | | | | -------------------------------------------------------------------------------- | (Unaudited) | | | | | | -------------------------------------------------------------------------------- | (MEUR) | | | | | | -------------------------------------------------------------------------------- | | 2007 | 2006 | 2006 | | | -------------------------------------------------------------------------------- | | 1-9 | 1-9 | 1-12 | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Cash flow from | 2.8 | 3.4 | +4.7 | | | | operations | | | | | | -------------------------------------------------------------------------------- | Cash flow from | -1.5 | -0.5 | -1.6 | | | | investments, net | | | | | | -------------------------------------------------------------------------------- | Total cash flow from | -2.9 | -1.2 | -1.0 | | | | financing | | | | | | -------------------------------------------------------------------------------- | Increase in credit | 0.0 | +2.0 | +10.7 | | | | capital | | | | | | -------------------------------------------------------------------------------- | Decrease in credit | -2.5 | -3.3 | -10.7 | | | | capital | | | | | | -------------------------------------------------------------------------------- | Dividends paid | 0.0 | 0.0 | 0.0 | | | -------------------------------------------------------------------------------- | Other financial items | -0.4 | +0.1 | -0.3 | | | -------------------------------------------------------------------------------- | Change in liquid | -1.6 | +1.8 | +2.0 | | | | assets | | | | | | -------------------------------------------------------------------------------- | Liquid assets at the | +4.1 | +2.1 | +2.1 | | | | beginning of period | | | | | | -------------------------------------------------------------------------------- | Liquid assets at the | +2.5 | +3.9 | +4.1 | | | | end of period | | | | | | -------------------------------------------------------------------------------- Notes to the interim report Calculation methods The accounting principles used in this interim report correspond to IFRS standards. The figures are unaudited. -------------------------------------------------------------------------------- | TANGIBLE ASSETS | | -------------------------------------------------------------------------------- | (MEUR) | | -------------------------------------------------------------------------------- | (Unaudited) | Tangible | -------------------------------------------------------------------------------- | | assets | -------------------------------------------------------------------------------- | Acquisition cost 1.1.2007 | 60.4 | -------------------------------------------------------------------------------- | Translation difference (+/-) | -0.0 | -------------------------------------------------------------------------------- | Increase | 1.7 | -------------------------------------------------------------------------------- | Decrease | -0.7 | -------------------------------------------------------------------------------- | Transfers between balance sheet items | 0.1 | -------------------------------------------------------------------------------- | Acquisition cost 30.9.2007 | 61.6 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Accumulated depreciation 1.1.2007 | -35.0 | -------------------------------------------------------------------------------- | Translation difference (+/-) | -0.0 | -------------------------------------------------------------------------------- | Disposals and reclassifications | 0.7 | -------------------------------------------------------------------------------- | Depreciation for the period | -2.6 | -------------------------------------------------------------------------------- | Accumulated depreciation 30.9.2007 | 37.1 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Book value 1.1.2007 | 25.4 | -------------------------------------------------------------------------------- | Book value 30.9.2007 | 24.5 | -------------------------------------------------------------------------------- Own shares Honkarakenne Oyj acquired during the reporting period 62.406 of its own B shares, whose purchase price amounted to EUR 0.36 million. Events in the circle of acquaintances The circle of acquaintances consists of subsidiaries associated companies and the company's management. The management included in the circle of acquaintances comprises the Board of Directors, CEO and the company's managing committee. Wages and bonuses paid to the company's management will be published in the annual financial report. -------------------------------------------------------------------------------- | CONTINGENT LIABILITIES | | | | -------------------------------------------------------------------------------- | (Unaudited) | | | | -------------------------------------------------------------------------------- | (MEUR) | | | | -------------------------------------------------------------------------------- | | 2007 | 2006 | 2006 | -------------------------------------------------------------------------------- | | 1-9 | 1-9 | 1-12 | -------------------------------------------------------------------------------- | For own loans | | | | -------------------------------------------------------------------------------- | - Mortgages | 19.20 | 20.90 | 20.00 | -------------------------------------------------------------------------------- | - Pledged shares | 0.18 | 0.18 | 0.18 | -------------------------------------------------------------------------------- | For others | | | | -------------------------------------------------------------------------------- | - Guarantees | 0.94 | 0.46 | 1.49 | -------------------------------------------------------------------------------- | Leasing liabilities | 0.35 | 0.50 | 0.30 | -------------------------------------------------------------------------------- | Rent liabilities | 0.40 | 0.48 | 0.42 | -------------------------------------------------------------------------------- | Other liabilities | 0.28 | 0.10 | 0.35 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Nominal values of forward | 0.00 | 1.4 | 0.00 | -------------------------------------------------------------------------------- | exchange contracts | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | KEY INDICATORS | 2007 | 2006 | 2006 | -------------------------------------------------------------------------------- | | 1-9 | 1-9 | 1-12 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Earnings/share (EPS), EUR | 0.70 | -0.50 | -0.42 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Equity/share, EUR | 5.34 | 4.6 | 4.7 | -------------------------------------------------------------------------------- | Equity ratio, % | 41.0 | 36.8 | 37.7 | -------------------------------------------------------------------------------- | Net debt (MEUR) | 10.7 | 11.7 | 11.7 | -------------------------------------------------------------------------------- | Gearing, % | 53.5 | 67.3 | 65.7 | -------------------------------------------------------------------------------- | Gross investments (MEUR) | 2.1 | 1.9 | 2.6 | -------------------------------------------------------------------------------- | % of net sales | 2.9 | 3.1 | 3.1 | -------------------------------------------------------------------------------- | Average number of personnel | 422 | 428 | 428 | -------------------------------------------------------------------------------- | Order book (MEUR) | 29.9 | 29.3 | 32.6 | -------------------------------------------------------------------------------- Calculation of key indicators -------------------------------------------------------------------------------- | Earnings/share | Profit before extraord. items - income | | | | taxes - minority interest | | -------------------------------------------------------------------------------- | | Adjusted average number of shares | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Equity/share | Shareholders' equity | | -------------------------------------------------------------------------------- | | Number of shares outstanding at end of | | | | period | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Equity ratio, % | Shareholders' equity + minority | x 100 | | | interest | | -------------------------------------------------------------------------------- | | Balance sheet total - advances | | | | received | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Net debt | Interest-bearing debt-cash and cash | | | | equivalents | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Gearing, % | Interest-bearing net debt | x 100 | -------------------------------------------------------------------------------- | | Shareholders' equity + minority | | | | interest | | --------------------------------------------------------------------------------
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