2014-04-30 10:00:02 CEST
2014-04-30 10:00:07 CEST
REGULATED INFORMATION
Scanfil Oyj - Interim report (Q1 and Q3)
SCANFIL GROUP’S INTERIM REPORT 1 JANUARY – 31 MARCH 2014
SCANFIL PLC INTERIM REPORT 30 APRIL 2014 11.00 A.M.
SCANFIL GROUP'S INTERIM REPORT 1 JANUARY - 31 MARCH 2014
January - March
- Turnover totaled to EUR 47.6 million (Q1 2013: 44.0) up 8.0%
- Operating profit EUR 2.5 million (Q1 2013: 2.0),
5.3% of turnover (Q1 2013: 4.6%)
- Profit for the review period was EUR 1.7 million (Q1 2013: 1.1)
- Earnings per share were EUR 0.03 (Q1 2013: 0.02)
- The turnover includes EUR 0.2 million of non-recurring expenses related to
the purchase of Schaltex GmbH.
Scanfil EMS Oy, a subsidiary of Scanfil Plc, has purchased the entire share
capital of the German contract manufacturer Schaltex Systems GmbH on 31 March
2014 and authority was transferred to Scanfil EMS Oy at the same time. The
subsidiary acquired has not been consolidated to Group's balance sheet in the
review period. The consolidation would not have had any effect to the Group's
result. The effect of consolidation would, according to the preliminary
information, increase the Group's assets and liabilities EUR 2.3 million, and
the estimated goodwill would be EUR 3.7 million.
On 1 April 2014, Scanfil announced that the deal is expected to have a positive
impact on the sales and turnover of the Scanfil Group starting from that date.
Scanfil estimated that its turnover will increase by 11-18% and that its
operating profit for 2014 will be EUR 11.0-15.0 million.
Scanfil earlier estimated that its turnover for 2014 will increase by 4-10% and
that the operating profit for the year will reach EUR 10.0-14.0 million.
Petteri Jokitalo, CEO of Scanfil plc:
“The year started on a positive note. We were able to continue our profitable
growth. Turnover was up by 8% and operating profit by 26% from the previous
year. We have been particularly happy to see that sales to telecommunication
customers increased during the first quarter after a long declining trend.
The German contract manufacturer Schaltex, acquired at the end of March, will
further accelerate our growth strategy by strengthening our market position in
Germany and bringing us new major customers. We believe that Scanfil's
processes and purchase operations are able to create added value for Schaltex's
customer base. The customers will also benefit from having the manufacturing
capacity of our Estonian, Finnish, Hungarian and Chinese factories at their
disposal.”
BUSINESS TRENDS
In the first quarter of the year, Scanfil's turnover amounted to EUR 47.6
million (2013: EUR 44.0 million). Operating profit amounted to EUR 2.5 million
(2.0), up approximately 26%. The positive development of the operating profit
was mainly due to the increased sales volume and successful cost control.
Sales to professional electronics customers increased by approximately 7% in
January-March, and were approximately 80% of the turnover (81%). Sales to
telecommunication customers increased. In the first quarter of the year, there
was an increase of 14% compared to the same period in the previous year.
Telecommunication customers amounted to approximately 20% (19%).
Scanfil EMS Oy, a subsidiary of Scanfil Plc, has purchased the entire share
capital of the German contract manufacturer Schaltex Systems GmbH on 31 March
2014. The purchase price was approximately EUR 6.6 million, which includes in
addition to the shares a subsidiary loan of EUR 0.8 million. Scanfil EMS Oy
financed the deal from its liquid assets. The deal entered into force
immediately, and the operations of Schaltex Systems GmbH will be included in
Scanfil's consolidated financial statements starting from 1 April 2014.
The purchase will strengthen Scanfil's position in the German market and widen
the Group's customer base. Schaltex Systems GmbH, established in 1976 and based
in Germany, is an electronics contract manufacturer specialised in high mix,
low volume production. Schaltex Systems GmbH has approximately 80 employees.
Its manufacturing facilities are located in Schenefeld, near Hamburg. Schaltex
focuses on the assembly and testing of complex equipment. It mainly serves
customers of the life science and analyser markets. Turnover for the accounting
period that ended in 2013 was EUR 20.8 million.
FINANCIAL DEVELOPMENT
The Group's turnover for January - March was EUR 47.6 (44.0) million. The
breakdown of turnover by regional segment was as follows: Europe 61% (65%) and
Asia 39% (35%).
Operating profit for the Group during the review period was EUR 2.5 (2.0)
million, representing 5.3% (4.6%) of turnover. The turnover includes EUR 0.2
million of non-recurring expenses related to the purchase of Schaltex GmbH.
Earnings for the review period amounted to EUR 1.7 (1.1) million. Earnings per
share were EUR 0.03 (0.02) and return on investment was 10.6% (6.3%).
FINANCING AND CAPITAL EXPENDITURE
The Group enjoys a strong financial position.
The consolidated balance sheet totalled EUR 130.5 (135.6) million. Liabilities
amounted to EUR 49.4 (57.7) million, EUR 31.3 (28.5) million of which were
non-interest-bearing and EUR 18.2 (29.2) million interest-bearing. The equity
ratio was 62.1% (57.5%) and gearing -4.8% (3.0%). The equity per share was EUR
1.40 (1.35).
Liquid cash assets totalled EUR 22.0 (26.8) million. Cash and cash equivalents
of the comparison period included EUR 10.1 million of time deposits with
maturity exceeding three months.
Cash flows from operating activities in the review period of January - March
came to EUR 0.5 (-2.1) million. The change in working capital during the period
amounted to EUR -2.6 (-5.1) million. Cash flow from investment activities was
EUR -6.2 (-1.9).
Gross investments in fixed assets totalled EUR 6.4 (2.4) million, which is
13.4% (5.4 %) of turnover. Investments include EUR 5.8 million acquisition cost
of shares of Schaltex Systems GmbH. Other investments are mainly investments in
machines and equipment. Depreciations were EUR 1.0 (1.1) million.
DECISIONS BY THE ANNUAL GENERAL MEETING AND BOARD OF DIRECTORS' AUTHORISATION
Scanfil plc's Annual General Meeting was held at company's main office in Sievi
on 8 April 2014.
According to Board of Directors' proposal The Annual General Meeting decided to
distribute a dividend total of EUR 0.05 per share. The record date for the
payment of dividend was 11 April 2014 and the date of payment of the dividend
was 23 April 2014.
The Meeting decided that the Board of Directors shall consist of five members.
Harri Takanen, Jorma J. Takanen, Jarkko Takanen and Riitta Kotilainen were
re-elected as members of the Board of Directors and Christer Härkönen was
elected as new member of Board of Directors. The meeting decided that the
remuneration of Chairman of the Board of Directors is EUR 2,000/month and
remuneration of a member of the Board of Directors is EUR 1,500/month.
In its meeting, held after the General Meeting, the Board of Directors elected
Harri Takanen as the Chairman of the Board of Directors.
The Meeting decided according to the Board of Directors' proposal to authorize
the Board of Directors to decide on the acquisition of the Company's own shares
with distributable assets.
The Board of Directors' proposals to the Annual General Meeting are available
on the company website at www.scanfil.com.
The minutes of the Annual General Meeting have been available on the company's
website, www.scanfil.com, as of 22 April 2014.
SHARE TRADING AND SHARE PERFORMANCE
The highest trading price during the review period was EUR 1.53 and the lowest
EUR 1.30, the closing price for the period standing at EUR 1.48. A total of
1,054,735 shares were traded during the period, corresponding to 1.8% of the
total number of shares. The market value of the shares on 31 March 2014 was EUR
85.4 million.
PERSONNEL
Scanfil Group's personnel averaged 1,717 (1,685) employees during the review
period. At the end of the period, the Group employed 1,725 (1,675) people, of
whom 247 (266) worked in the company's Finnish units and 1,478 (1,409) in the
company's units outside Finland. In all, 86% (84%) of the Group's personnel
were employed by subsidiaries outside Finland on 31 March 2014.
FUTURE PROSPECTS
On 1 April 2014, Scanfil adjusted its estimate for the turnover and operating
profit for 2014 upwards. Scanfil estimated that in 2014, its turnover will
increase by 11-18% and its operating profit will be EUR 11.0-15.0 million.
Scanfil earlier estimated that its turnover for 2014 will increase by 4-10% and
that the operating profit for the year will reach EUR 10.0-14.0 million.
Turnover for 2013 was EUR 188.5 million and operating profit EUR 11.8 million.
OPERATIONAL RISKS AND UNCERTAINTIES
Weakening of the global economy and the decrease in international demand for
investment commodities might have a negative impact on the development of the
business of Scanfil's customers and impair the demand in the contract
manufacturing market. This would have a negative impact on the development of
Scanfil's sales and profitability.
In other respects, the risks facing Scanfil's business have remained
essentially the same. The company's risks and risk management are described in
greater detail on the company's website under Corporate Governance and in the
notes to the consolidated financial statements.
ACCOUNTING PRINCIPLES
The interim report has been prepared in accordance with the IAS 34 Interim
Financial Reporting standard, applying the following accounting policies with
the financial statements for 2013.
Individual figures and grand totals of tables have been rounded to the nearest
million euros, so they will not always add up. The figures are unaudited.
CONSOLIDATED INCOME STATEMENT
EUR million
1 - 3 1 - 3 1 - 12
2014 2013 2013
Turnover 47.6 44.0 188.5
Other operating income 0.0 0.1 0.3
Changes in inventories of finished goods
and work in progress 0.4 0.6 1.2
Manufacturing for own use 0.0 0.0
Expenses -44.4 -41.6 -173.8
Depreciation -1.0 -1.1 -4.4
Operating profit 2.5 2.0 11.8
Financial income and expenses -0.3 -0.5 -0.6
Share in the associated company´s profit -0.2 -0.6
Profit before taxes 2.2 1.3 10.6
Income taxes -0.6 -0.2 -2.4
Net profit for the period 1.7 1.1 8.2
Attributable to:
Equity holders of the parent 1.7 1.1 8.2
Earnings per share for profit attributable to
shareholders of the parent:
undiluted and diluted
earnings per share ( EUR) 0.03 0.02 0.14
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
EUR million
1 - 3 1 - 3 1 - 12
2014 2013 2013
Net profit for the period 1.7 1.1 8.2
Items that may later be recognized in profit or loss
Translation differences -1.1 1.7 -0.7
Derivative Financial Instrument 0.0 0.1 0.3
Other comprehensive income, net of tax -1.1 1.8 -0.4
Total Comprehensive Income 0.6 2.9 7.8
Attributable to:
Equity holders of the parent 0.6 2.9 7.8
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
EUR million
Assets 31.3.2014 31.3.2013 31.12.2013
Non-current assets
Property, plant and equipment 27.4 31,6 28.5
Goodwill 2.2 2.2 2.2
Other intangible assets 4.1 3.6 4.1
Shares in Group companies 5.8
Shares in associated companies 0.5
Available-for-sale investments 0.0 0.0 0.0
Receivables 0.2
Deferred tax assets 0.3 0.6 0.3
Total non-current assets 39.9 38.7 35.1
Current assets
Inventories 29.5 31.4 28.7
Loan receivables from associated companies 0.1
Trade and other receivables 39.0 38.2 33.5
Advance payments 0.1 0.2 0.1
Other financial assets 10.1
Current tax 0.2
Cash and cash equivalents 22.0 16.8 28.2
Total current assets 90.6 96.9 90.5
Total assets 130.5 135.6 125.6
Shareholder's equity and liabilities 31.3.2014 31.3.2013 31.12.2013
Equity
Share capital 2.0 2.0 2.0
Translation differences 7.1 10.7 8.2
Other reserves 5.8 5.4 5.7
Reserve for invested unrestricted equity fund 10.7 10.7 10.7
Retained earnings 55.5 49.1 53.8
Total equity 81.1 77.9 80.5
Non-current liabilities
Deferred tax liabilities 0.0
Provisions 0.5 0.4 0.4
Interest bearing liabilities 9.1 19.4 9.2
Total non-current liabilities 9.6 19.8 9.5
Current liabilities
Trade and other liabilities 30.3 27.1 26.0
Current tax 0.5 1.0 0.4
Interest bearing liabilities 9.1 9.7 9.2
Total current liabilities 39.8 37.9 35.6
Total liabilities 49.4 57.7 45.1
Total shareholder's equity and liabilities 130.5 135.6 125.6
The subsidiary acquired on 31 March 2014 has not been consolidated to Group
balance sheet.
The effect of consolidation would, according to the preliminary
information, increase the Group's assets and liabilities EUR 2.3
million, the estimated goodwill would be EUR 3.7 million.
CONSOLIDATED CASH FLOW STATEMENT
EUR million
1.1.-31.3.2014 1.1.-31.3.2013 1.1-31.12.2013
Cash flow from operating
activities
Net profit 1.7 1.1 8.2
Adjustments for the net profit 1.9 2.0 8.2
Change in net working capital -2.6 -5.1 -0.6
Paid interests and other 0.0 0.0 -0.6
financial expenses
Interest received 0.0 0.0 0.5
Taxes paid -0.5 -0.1 -2.5
Net cash from operating 0.5 -2.1 13.2
activities
Cash flow from investing
activities
Investments in tangible and -0.4 -1.9 -4.2
intangible assets
Sale of tangible and intangible 0.0 0.0 0.2
assets
Acquisition of Group company -5.8
Purchase of investments 0.0
Receivings from other 9.8
investments
Capital transfer tax refund 0.1
Repayment of loans receivable 0.0
Net cash from investing -6.2 -1.9 5.8
activities
Cash flow from financing
activities
Repayment of long-term loans -8.9
Dividends paid -2.3
Net cash from financing 0.0 0.0 -11.2
activities
Net increase/decrease in cash -5.7 -4.0 7.9
and cash equivalents
Cash and cash equivalents at 28.2 20.5 20.5
beginning of period
Changes in exchange rates -0.4 0.4 -0.2
Cash and cash equivalents at end 22.0 16.8 28.2
of period
STATEMENT OF CHANGES IN CONSOLIDATED EQUITY
EUR million
Reserve for
invested
Share Translation Other unrestricted Retained Equity
Equity capital differences reserves equity fund earnings total
--------------------------------------------------------------------------------
1.1.2014 2.0 8.2 5.7 10.7 53.8 80.5
Total comprehensive -1.1 0.0 1.7 0.6
income
Equity
--------------------------------------------------------------------------------
31.3.2014 2.0 7.1 5.8 10.7 55.5 81.1
Equity attributable to equity holders of the parent company
Reserve for
invested
Share Translation Other unrestricted Retained Equity
Equity capital differences reserves equity fund earnings total
--------------------------------------------------------------------------------
1.1.2013 2.0 8.9 5.3 10.7 48.0 75.0
Total comprehensive 1.7 0.1 1.1 2.9
income
Equity
--------------------------------------------------------------------------------
31.3.2013 2.0 10.7 5.4 10.7 49.1 77.9
KEY INDICATORS
1 - 3 1 - 3 1 - 12
2014 2013 2013
Return on equity, % 8.3 5.9 10.6
Return on investment, % 10.6 6.3 11.4
Interest-bearing liabilities, EUR million 18.2 29.2 18.3
Gearing, % -4.8 3.0 -12.2
Equity ratio, % 62.1 57.5 64.1
Gross investments in fixed assets, EUR million 6.4 2.4 4.0
% of net turnover 13.4 5.4 2.1
Personnel, average 1 717 1 685 1 672
Earnings per share, EUR 0.03 0.02 0.14
Shareholders´ equity per share, EUR 1.40 1.35 1.39
Number of shares at
the end of period, 000´s
- not counting own shares 57 730 57 730 57 730
- weighted average 57 730 57 730 57 730
The company has a EUR 18.2 million loan in connection with which the company has
entered
into interest and currency swap agreements to convert the SEK-denominated
principal
and cash flows of instalments and interest payments into euros. The interest and
currency swap agreement fully hedges the instalments and interest payments
against
fluctuations in exchange and interest rates.
Owing to the nature of the sector, the company´s order book covers only a short
period of time and
does not give an accurate picture of future development.
SEGMENT INFORMATION
EUR million
1 - 3 1 - 3 1 - 12
2014 2013 2013
Turnover
Europe 29.8 29.3 112.2
Asia 18.8 15.6 79.6
Turnover between segments -1.0 -0.9 -3.3
Total 47.6 44.0 188.5
Operating profit
Europe 1.3 1.6 5.2
Asia 1.2 0.5 6.6
Total 2.5 2.0 11.8
Assets
Europe 71.8 67.9 67.8
Asia 56.5 65.0 55.5
Goodwill 2.2 2.2 2.2
Shares in associated companies 0.5
Total 130.5 135.6 125.6
CHANGES IN TANGIBLE NON-CURRENT ASSETS
EUR million
1 - 3 1 - 3 1 - 12
2014 2013 2013
Book value at the beginning of the 28.5 30.5 30.5
period
Additions 0.4 2.0 2.9
Deductions 0.0 0.0 -0.5
Depreciations -1.0 -1.1 -4.2
Exchange rate differences -0.5 0.2 -0.2
Book value at the end of the period 27.4 31.6 28.5
FINANCIAL ASSETS AND LIABILITIES, CARRYING AMOUNT AND FAIR VALUE
EUR million
31.3.2014 31.3.2014
Book values of Fair values of
balance sheet balance sheet
values values
Non-current assets
Available for sale investments 0.0 0.0
Non-current assets total 0.0 0.0
Current assets
Trade and other receivables 37.7 37.7
Cash and cash equivalents 22.0 22.0
Current assets total 59.7 59.7
Total financial assets 59.7 59.7
Non-current financial liabilities
Interest bearing liabilities from 9.1 9.1
financial institutions
Derivative 0.1 0.1
Non-current financial liabilities total 9.2 9.2
Current financial liabilities
Interest bearing liabilities from 9.1 9.1
financial institutions
Derivative 0.1 0.1
Trade and other payables 25.0 25.0
Current financial liabilities total 34.2 34.2
Current financial liabilities total 43.3 43.3
The valuation of derivatives is based on market data
(level 2).
The valuation of available for sale investments is based on the acquisition cost
(level 3) as the fair value
of the shares cannot be determined
reliably.
CONTINGENT LIABILITIES
EUR million
1 - 3 1 - 3 1 - 12
2014 2013 2013
Given business mortgages 26.0 40.0 40.0
Pledged guarantees 5.9 1.0 6.4
Leasing liabilities and other lease 0.0 0.1 0.0
liabilities
On 31 March 2014 acquired unconsolidated subsidiary has long
term lease contracts
that include liabilities at the acquisition time approximately
EUR 3.0 million.
TRANSACTIONS WITH RELATED PARTIES
EUR million
1 - 3 1 - 3 1 - 12
2014 2013 2013
Related party transactions:
Associated companies
Sales income 0.0 0.0 0.1
Trade receivables 0.1
Interest income 0.0 0.0
Loan receivables 0.3
Interest receivables 0.0
Scanfil EMS Oy has rented an office space from Kiinteistö Oy Pilot 1, which is
owned by a company
whose head owners are Jorma Takanen, Harri Takanen, Jarkko Takanen and Reijo
Pöllä.
Rental costs were EUR 5 thousand by 31 March 2014 (EUR 3 thousand in 2013).
KEY INDICATORS QUATERLY
Q1/14 Q4/13 Q3/13 Q2/13 Q1/13 Q4/12 Q3/12 Q2/12
Turnover, MEUR 47.6 45.4 50.4 48.7 44.0 40.8 48.2 49.3
Operating profit, MEUR 2.5 2.5 4.2 3.1 2.0 0.7 2.8 3.2
Operating profit, % 5.3 5.6 8.4 6.3 4.6 1.8 5.7 6.4
Net income, MEUR 1.7 1.9 3.0 2.1 1.1 0.3 1.7 2.6
SCANFIL PLC
Petteri Jokitalo
CEO
Additional information:
CEO Petteri Jokitalo
Tel +358 8 4882 111
Distribution NASDAQ OMX, Helsinki
Major Media
www.scanfil.com
Scanfil Group is engaged in contract manufacturing for international
telecommunications technology and professional electronics manufacturers.
Scanfil has almost 40 years of experience in demanding contract manufacturing.
Scanfil is a systems supplier that offers its products and services to
international telecommunications systems manufacturers and professional
electronics customers. Typical products are equipment systems for mobile and
public switched telephone networks, automation systems, frequency converters,
lift control systems, equipment and systems for electricity production and
transmission, analysers, slot machines and different meteorological
instruments. The company has production facilities in China, Estonia, Hungary
and Finland.
Not to be published or distributed, directly or indirectly, in any country
where its distribution or publication is unlawful. Forward looking statements:
certain statements in this stock exchange release may constitute"forward-looking" statements which involve known and unknown risks,
uncertainties and other factors which may cause actual results, performance or
achievements of Scanfil Oyj to be materially different from any future results,
performance or achievements expressed or implied by such forward-looking
statements. When used in this stock exchange release, such statements use such
words as "may,""will,""expect,""anticipate,""project,""believe,""plan"
and other similar terminology. New risk factors may arise from time to time and
it is not possible for management to predict all of those risk factors or the
extent to which any factor or combination of factors may cause actual results,
performance and achievements of Scanfil Oyj to be materially different from
those contained in forward-looking statements. Given these risks and
uncertainties, investors should not place undue reliance on forward-looking
statements as a prediction of actual results. The forward-looking information
contained in this stock exchange release is current only as of the date of this
stock exchange release. There should not be an expectation that such
information will in all circumstances be updated, supplemented or revised,
except as provided by the law or obligatory regulations, whether as a result of
new information, changing circumstances, future events or otherwise.
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