2009-08-06 07:15:00 CEST
2009-08-06 07:15:02 CEST
REGULATED INFORMATION
PKC Group Oyj - Interim report (Q1 and Q3)
PKC GROUP'S INTERIM REPORT JANUARY-JUNE/2009
PKC Group Oyj INTERIM REPORT 6 AUGUST 2009 8.15 a.m. PKC GROUP'S INTERIM REPORT JANUARY-JUNE/2009 PKC Group's net sales in the January-June period decreased by 42.7% from the previous year to EUR 99.6 million (173.7 million in Jan.-Jun. 2008). Operating profit was EUR 5.5 million negative (19.0 million positive) and profit before taxes was EUR 6.4 million negative (17.1 million positive). Earnings per share were EUR 0.45 negative (0.67 positive). The result is burdened by approximately EUR 4.8 million in non-recurring expenses. Cash flows after investing activities during the report period were EUR 27.4 million (16.3 million). HARRI SUUTARI, PRESIDENT AND CEO: ”The continuing decline in production volumes in our customer sectors, particularly in the heavy commercial vehicle industry, led to a negative operating profit during the first half. The order bookings and delivery volumes for commercial vehicles exceeded the production volumes during the second quarter. This indicates that the production volumes should not further decrease from the currently exceptionally low level. Continued rationalisation measures and inputs in R&D puts trust in the continuous improvement of the PKC competitive position. Due to the current market situation, the supplier base in the commercial vehicle industry is going through radical change, in turn opening up new possibilities for PKC.” OPERATING ENVIRONMENT Wiring Harnesses The deliveries and new orders of heavy trucks saw a very sharp decline during the first half of the year in all of our market areas in comparison to the same period a year earlier. In Europe, our main market, the volume of deliveries and the value of the new orders received by our customers reached only a third of what it had been a year earlier. In South America, deliveries fell by a third but new orders fell by half. Our customers succeeded in reducing their stocks of finished trucks, causing the production volumes of wiring harnesses to fall behind from the truck delivery volumes. PKC deliveries for the truck industry only decreased by approximately 43%, which was due to the increased market share. Deliveries for the machinery industry in Europe reached approximately one-third compared to the previous year. The production and deliveries of recreational products were halved in North America. PKC is participating in several competitive bid processes concerning new customer relationships. Success in these processes might lead to new long-term delivery relationships and the subsequent strengthening of the company's market position. Electronics With the exception of the Asian markets, industrial investments fell significantly early on in the year, reducing the Group's industrial electronics deliveries by approximately 30%. NET SALES AND FINANCIAL PERFORMANCE April-June 2009 Consolidated net sales from April-June amounted to EUR 45.8 million (88.6 million), down 48.3% on the same period a year earlier. Consolidated operating profit totalled EUR 5.6 million negative (9.6 million positive), accounting for 12.2% negative of net sales (10.9% positive). Depreciations amounted to EUR 2.8 million (2.1 million). Financial income and expenses were EUR 1.1 million negative (0.2 million negative). Profit before taxes was EUR 4.5 million negative (9.8 million positive). Profit for the report period totalled EUR 4.1 million negative (7.4 million positive). Diluted earnings per share were EUR 0.25 negative (0.42 positive). The result in the second quarter was burdened by EUR 4.5 million in non-recurring rationalisation expenses. January-June 2009 Consolidated net sales from January-June amounted to EUR 99.6 million (173.7 million), down 42.7% on the same period a year earlier. Consolidated operating profit totalled EUR 5.5 million negative (19.0 million positive), accounting for 5.5% negative of net sales (10.9% positive). Depreciations amounted to EUR 5.5 million (4.0 million). Financial income and expenses were EUR 0.9 million negative (1.9 million negative). Profit before taxes was EUR 6.4 million negative (17.1 million positive). Profit for the report period totalled EUR 7.4 million negative (12.1 million positive). Earnings per share were EUR 0.45 negative (0.67 positive). Net sales generated by the Wiring Harnesses business in the report period amounted to EUR 74.9 million (138.7. million), or 46.0% less than in the comparative period. The segment's share of consolidated net sales was 75.2% (79.8%). It generated an operating profit of EUR 6.9 million negative (12.1 million positive), equivalent to 9.2% negative of the segment's net sales (8.7% positive). The result of the Wiring Harnesses business in the first half was burdened in total by EUR 4.8 million in non-recurring rationalisation expenses. Net sales generated by the Electronics business decreased by 30.2% to EUR 24.8 million positive (35.0 million positive). The segment's share of consolidated net sales was 24.9% (20.2%). It generated an operating profit of EUR 1.4 million positive (6.9 million positive), equivalent to 5.6% of the segment's net sales (19.6%). BALANCE SHEET AND FINANCING Consolidated total assets as at 30 June 2009 stood at EUR 160.3 million (178.1 million). Interest-bearing liabilities totalled EUR 52.8 million at the close of the report period (47.8 million). The Group's equity ratio was 42.5% (48.6%). Net liabilities totalled EUR 33.5 million (36.3 million) and gearing was 49.1% (42.0%). Inventories amounted to EUR 36.1 million (45.3 million). Current receivables totalled EUR 47.4 million (73.2 million). Cash flows after investing activities during the report period were EUR 27.4 million (16.3 million). Cash in hand and at the bank amounted to EUR 19.4 million (11.5 million). In order to ensure financing flexibility, PKC has available credit facilities. The Annual General Meeting on 27 March 2009 resolved to pay a dividend of EUR 0.15 per share, or a total of around EUR 2.7 million. The dividend was paid out on 8 April 2009. CAPITAL EXPENDITURES During the report period, the Group's gross capital expenditures totalled EUR 2.0 million (3.9 million), representing 2.0% of net sales (2.2%). Capital expenditures consisted mostly of the acquisition of production machinery and equipment. The integration of the North America business has been completed with the implementation of the Group's ERP system. After the end of the report period, the ERP system has also been taken into use at the Poland unit. RESEARCH AND DEVELOPMENT Research and development expenditure totalled EUR 2.9 million (3.2 million), representing 2.9% (1.8%) of consolidated net sales. At the end of the report period, 113 (104) people were employed in product development. PERSONNEL During the report period, the Group had an average payroll of 4,768 employees (5,638). At the end of the report period, the Group's personnel numbered 4,320 employees (5,722), of whom 3,677 (4,901) worked abroad and 643 (821) in Finland. Personnel cuts have been made at various units within the Group. A total of EUR 2.4 million in non-recurring expenses arising from the termination of employee contracts was recorded in the first half. As a result of the co-determination negotiations concluded in January 2009, it was decided to temporarily lay off almost the entire personnel of PKC Group Oyj's Kempele unit, a total of 250 people, with the duration of the layoffs varying between a week and longer periods, as well as 60 employees at PKC Electronics Oy's Raahe factory for a maximum of three months. As a result of the co-determination negotiations concluded in May 2009, it was decided to terminate the employment contracts of 128 employees of the PKC Group Oyj's Kempele unit in two phases. As a result of the co-determination negotiations concluded in June 2009, it was decided to temporarily lay off approximately 45 employees at the PKC Group Oyj's Kempele unit. The temporary layoffs were a continuation of the co-determination negotiations concluded in January and the duration of the layoffs varies from one to six weeks per employee. The temporary layoffs will be carried out by the end of December. As a result of the co-determination negotiations concluded in August PKCElectronis shall layoff 60 employees for an indefinite period. Lay-offs shall be carried out in phases by the end of December. QUALITY AND THE ENVIRONMENT The Wiring Harnesses business operations at the Haapsalu, Keila, Kempele, Kostomuksha and Nogales production units have been certified in accordance with the ISO/TS 16949 and ISO 9001 standards as well as the ISO 14001 standard. The Curitiba production unit is certified under the ISO/TS 16949, ISO14001 and OHSAS 18001 (Occupational Health and Safety) standards. The certification process at the wiring harness factory in Poland is proceeding as planned so that during the first stage, ISO9001 and ISO14001 certifications will be completed during the last quarter. After this, ISO/TS 16949 certification is to be completed in the second stage during the first quarter of 2010. The Group's Electronics business operations at the Kostomuksha, Suzhou and Raahe production units have been certified in accordance with the ISO 9001 and ISO 14001 standards. Preparation for the adoption and certification of the ISO/TS 16949 standard continues. The system certification will be completed in two stages during the third and fourth quarters. The implementation and development of the best quality practices in the Group's Wiring Harnesses business forms one of the Group's strategic objectives. These best practices support continuous development by involving personnel more extensively in day-to-day quality enhancement work. During the report period, the best quality practices were audited internally. Best practises are enhanced in the spirit of continuous improvement both in terms of the content and the evaluation practises. Progress is actively being monitored by the Group's Executive Board. MANAGEMENT The Annual General Meeting re-elected Endel Palla, Olli Pohjanvirta, Matti Ruotsala and Jyrki Tähtinen to seats on the Board of Directors. Outi Lampela was elected as a new member to the Board. At its organisation meeting, the Board of Directors elected Matti Ruotsala Chairman and Jyrki Tähtinen Vice Chairman. The Authorized Public Accountant Firm Ernst & Young Oy will continue as the company's auditor, with Juhani Rönkkö, Authorized Public Accountant, acting as the principal auditor. The PKC Group Oyj Board of Directors resolved on 30 April 2009 to appoint an auditing committee among its members. Outi Lampela was nominated chairman and Olli Pohjanvirta member of the Audit Committee. SHARE TURNOVER AND SHAREHOLDERS PKC Group Oyj's share turnover on NASDAQ OMX Helsinki Oy from 1 January to 30 June 2009 was 4,436,698 shares (7,550,701 shares), representing 25.0% of the average number of shares (42.5%). Shares were traded to a total value of EUR 15.8 million (34.7 million). The lowest share value during the report period was EUR 2.70 (6.88) and the highest EUR 4.44 (9.48). The closing price on the last trading day of the report period was EUR 3.60 (6.97) and the average price during the period was EUR 3.59 (7.60). The company's market capitalisation at 30 June 2009 was EUR 64.0 million (123.9 million). The shares held by Board members, related individuals and corporations in which they have a controlling interest accounted for 2.0% (2.9%) of the total number of shares at the end of the report period. PKC Group Oyj had 7,707 shareholders (7,407) at the end of the report period. The proportion of shares held by foreigners and by way of nominee registrations at the close of the report period was 16.3% of the shares outstanding (24.7%). SHARE CAPITAL The Board of Directors was granted authorisation by the Annual General Meeting on 29 March 2007 to decide on one or more share issues and the granting of special rights as defined in Chapter 10, Section 1 of the Companies Act and on all the terms and conditions thereof. A maximum total of 3,500,000 shares may be issued, or subscribed to, based on authorisation. The authorisation includes the right to decide on a directed share issue and shall remain in force for five years from the date of the resolution of the Annual General Meeting. The authorisation may be used at the Board's discretion for financing corporate acquisitions, for carrying out inter-company co-operation or similar arrangements, or for strengthening the company's financing and capital structure. The Board of Directors does not possess the valid authorisation to acquire the company's own shares, in which the company does not have any own shares (treasury shares) in its possession. STOCK OPTION SCHEMES In 2006, PKC launched a stock option scheme according to which the maximum total number of stock options to be issued is 697,500, in which they are divided into A, B and C warrants. At the close of the report period, the company's key personnel had a total of 202,500 2006A warrants, 203,520 2006B warrants and 229,840 2006C warrants in their possession. The subscription period for shares through the exercise of stock options granted under the 2006 scheme shall be from 2009-2013. The share subscription price for stock options shall be the volume-weighted average price of the PKC Group Oyj share on NASDAQ OMX Helsinki, with dividend adjustments, as defined in the stock option terms (at present, EUR 10.49 for the 2006A, 2006B and 2006C warrants). Through the exercise of the 2006 stock options, the share capital of PKC Group Oyj may be increased by a maximum total of 697,500 new shares and EUR 234,673.67. The 2006 stock options are subject to a share ownership plan. Key personnel are obligated to subscribe to or purchase the company's shares with 20% of the gross income earned from stock options and to own these shares for two years. The company's President and CEO is obligated to own these shares for the duration of his managerial contract. The Annual General Meeting that was held on 27 March 2009 resolved to issue stock options to the key personnel of the Company and its subsidiaries. The maximum total number of stock options issued will be 600,000 and they are divided into A, B and C options. At the end of the report period, key personnel held a total of 161,500 2009A options. The share subscription price for shares through the exercise of stock options granted under the 2009 scheme shall be the volume-weighted average price for PKC Group shares during April 2009, 2010 and 2011 on NASDAQ OMX Helsinki Oy + 20% (for 2009A options, the current price is EUR 3.85). The amount of the dividend decided after the period for the determination of the share subscription price, but before shares are subscribed for, shall be deducted from the share subscription price of the stock options on each dividend record date. The share subscription price will be recorded in the invested non-restricted equity fund. The stock options entitle their owners to subscribe to a maximum total of 600,000 new shares in the company or existing shares held by the company. The share subscription period for 2009A stock options will be 1 April 2012 — 30 April 2014, for 2009B stock options 1 April 2013 — 30 April 2015 and for 2009C stock options 1 April 2014 — 30 April 2016. SHORT-TERM RISKS AND UNCERTAINTIES The financial crisis and the resulting economic downturn have also had an impact on demand for the products of PKC's customers in the commercial vehicles and electronics product groups. Other main uncertainties include price pressures and demands for tighter contractual terms as imposed by customers, the significant fluctuation of currency exchange rates as well as the impact of the financial crisis on suppliers and the availability of raw materials and components. The risks of the last few years concerning fluctuations in the prices of raw materials have decreased. Suppliers and their financial situation are being actively monitored throughout the order and delivery chain. The principles, objectives and organisation of the company's risk management as well as key risk areas are described in the risk management section of the Corporate Governance guidelines, which are available on the company's website, www.pkcgroup.com. OUTLOOK FOR THE FUTURE It is currently difficult to estimate how long the economic downturn will last. We estimate that the low predictability in the demand in commercial vehicle industry and general uncertainty of financing will keep the demand for wiring harnesses exceptionally low. We also estimate that demand for electronics design and manufacturing services in the market will weaken compared to last year. We predict that the full-year net sales will decrease substantially and for operating profit to be negative. The full year estimation contains significantly more uncertainty than usual due to the customer segments' exceptionally short outlooks. Thanks to the low need for capital expenditures and decrease of working capital, cash flows after investments are expected to be positive. PKC's balance sheet, liquidity and good customer relationships all enable improvement in PKC's relative competitive position. TABLES -------------------------------------------------------------------------------- | CONSOLIDATED STATEMENT | 4-6/09 | 4-6/08 | 1-6/09 | 1-6/08 | 1-12/08 | | OF COMPREHENSIVE | 3 mon. | 3 mon. | 6 mon. | 6 mon. | 12 mon. | | INCOME (1000 EUR) | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | NET SALES | 45,831 | 88,569 | 99,582 | 173,661 | 311,713 | -------------------------------------------------------------------------------- | Other operating income | 521 | 243 | 1,103 | 609 | 1,304 | -------------------------------------------------------------------------------- | Increase (+) / | -1,438 | -223 | -7,993 | -2,687 | 71 | | decrease (-) in stocks | | | | | | | of finished goods and | | | | | | | work in progress | | | | | | -------------------------------------------------------------------------------- | Materials and services | 24,797 | 47,245 | 51,440 | 92,117 | 172,198 | -------------------------------------------------------------------------------- | Employee benefits | 15,005 | 21,142 | 28,285 | 40,386 | 76,049 | | expenses | | | | | | -------------------------------------------------------------------------------- | Depreciation | 2,775 | 2,067 | 5,474 | 4,018 | 8,177 | -------------------------------------------------------------------------------- | Impairment loss for | 0 | 0 | 0 | 0 | 1,197 | | goodwill | | | | | | -------------------------------------------------------------------------------- | Other operating | 7,932 | 8,510 | 12,993 | 16,094 | 34,427 | | expenses | | | | | | -------------------------------------------------------------------------------- | OPERATING PROFIT/LOSS | -5,595 | 9,626 | -5,500 | 18,968 | 21,039 | -------------------------------------------------------------------------------- | Financial income | 1,731 | 1,629 | 6,770 | 2,535 | 8,406 | -------------------------------------------------------------------------------- | Financial expenses | -655 | -1,447 | -7,688 | -4,385 | -14,217 | -------------------------------------------------------------------------------- | PROFIT/LOSS BEFORE | -4,519 | 9,808 | -6,417 | 17,117 | 15,228 | | TAXES | | | | | | -------------------------------------------------------------------------------- | Income tax expense | 403 | -2,380 | -951 | -5,064 | -9,661 | -------------------------------------------------------------------------------- | PROFIT/LOSS FOR THE | -4,117 | 7,427 | -7,368 | 12,053 | 5,567 | | REPORT PERIOD | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Other comprehensive | | | | | | | income: | | | | | | -------------------------------------------------------------------------------- | Exchange differences | 141 | 232 | -466 | -542 | -1,500 | | on translating foreign | | | | | | | operations | | | | | | -------------------------------------------------------------------------------- | Total comprehensive | -3,975 | 7,660 | -7,834 | 11,511 | 4,067 | | income for the period: | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Profit/loss | | | | | | | attributable to: | | | | | | -------------------------------------------------------------------------------- | Shareholders of the | -4,117 | 7,338 | -7,368 | 11,939 | 5,519 | | parent company | | | | | | -------------------------------------------------------------------------------- | Minority interest | 0 | -89 | 0 | -113 | -47 | -------------------------------------------------------------------------------- | Total | -4,117 | 7,427 | -7,368 | 12,053 | 5,566 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | From profit/loss | | | | | | | attributable to | | | | | | | shareholders of the | | | | | | | parent company | | | | | | -------------------------------------------------------------------------------- | Basic earnings per | -0.23 | 0.41 | -0.41 | 0.67 | 0.31 | | share (EPS), EUR | | | | | | -------------------------------------------------------------------------------- | Diluted earnings per | -0.25 | 0.42 | -0.45 | 0.68 | 0.31 | | share (EPS), EUR | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | CONSOLIDATED STATEMENT OF | 6/09 | 6/08 | 12/08 | | FINANCIAL POSITION (1000 EUR) | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | ASSETS | | | | -------------------------------------------------------------------------------- | NON-CURRENT ASSETS | | | | -------------------------------------------------------------------------------- | Goodwill | 8,877 | 5,870 | 9,481 | -------------------------------------------------------------------------------- | Other intangible assets | 13,432 | 3,372 | 14,694 | -------------------------------------------------------------------------------- | Tangible assets | 32,782 | 34,550 | 34,931 | -------------------------------------------------------------------------------- | Deferred tax assets | 2,311 | 3,795 | 1,623 | -------------------------------------------------------------------------------- | Other receivables | 102 | 460 | 453 | -------------------------------------------------------------------------------- | Non-current assets total | 57,504 | 48,048 | 61,182 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | CURRENT ASSSETS | | | | -------------------------------------------------------------------------------- | Inventory | 36,102 | 45,349 | 51,815 | -------------------------------------------------------------------------------- | Receivables | | | | -------------------------------------------------------------------------------- | Trade receivables | 35,715 | 65,462 | 47,025 | -------------------------------------------------------------------------------- | Other receivables | 11,647 | 7,784 | 14,948 | -------------------------------------------------------------------------------- | Receivables total | 47,361 | 73,247 | 61,973 | -------------------------------------------------------------------------------- | Cash and cash equivalents | 19,354 | 11,466 | 12,468 | -------------------------------------------------------------------------------- | Current assets total | 102,817 | 130,061 | 126,256 | -------------------------------------------------------------------------------- | ASSETS TOTAL | 160,321 | 178,109 | 187,437 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | EQUITY AND LIABILITIES | | | | -------------------------------------------------------------------------------- | EQUITY | | | | -------------------------------------------------------------------------------- | Share capital | 5,983 | 5,983 | 5,983 | -------------------------------------------------------------------------------- | Share premium account | 4,862 | 4,862 | 4,862 | -------------------------------------------------------------------------------- | Reserve fund | 370 | 370 | 370 | -------------------------------------------------------------------------------- | Translation difference | -2,171 | -697 | -1,841 | -------------------------------------------------------------------------------- | Share-based payments | 915 | 987 | 808 | -------------------------------------------------------------------------------- | Retained earnings | 65,591 | 62,258 | 62,557 | -------------------------------------------------------------------------------- | Profit/loss for the report | -7,368 | 11,939 | 5,519 | | period | | | | -------------------------------------------------------------------------------- | Minority interest | | 876 | 328 | -------------------------------------------------------------------------------- | EQUITY TOTAL | 68,182 | 86,578 | 78,586 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | LIABILITIES | | | | -------------------------------------------------------------------------------- | Non-current liabilities | | | | -------------------------------------------------------------------------------- | Interest-bearing liabilities | 34,269 | 17,578 | 40,120 | -------------------------------------------------------------------------------- | Non-interest-bearing liabilities | | | | -------------------------------------------------------------------------------- | Provisions | 390 | 135 | 216 | -------------------------------------------------------------------------------- | Deferred tax liabilities | 3,338 | 654 | 3,461 | -------------------------------------------------------------------------------- | Non-current liabilities total | 37,997 | 18,367 | 43,797 | -------------------------------------------------------------------------------- | Current liabilities | | | | -------------------------------------------------------------------------------- | Interest-bearing liabilities | 18,559 | 30,210 | 31,866 | -------------------------------------------------------------------------------- | Trade payables | 17,679 | 24,486 | 14,907 | -------------------------------------------------------------------------------- | Other liabilities | 17,905 | 18,468 | 18,281 | -------------------------------------------------------------------------------- | Current liabilities total | 54,143 | 73,164 | 65,055 | -------------------------------------------------------------------------------- | Liabilities total | 91,750 | 91,531 | 108,851 | -------------------------------------------------------------------------------- | EQUITY AND LIABILITIES TOTAL | 160,321 | 178,109 | 187,437 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | CONSOLIDATED STATEMENT OF CASH | 1-6/09 | 1-6/08 | 1-12/08 12 | | FLOWS (1000 EUR) | 6 mon. | 6 mon. | mon. | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Cash flows from operating | | | | | activities | | | | -------------------------------------------------------------------------------- | Cash receipts from customers | 109,981 | 169,697 | 326,650 | -------------------------------------------------------------------------------- | Cash receipts from other | 1,060 | 602 | 1,304 | | operating activities | | | | -------------------------------------------------------------------------------- | Cash paid to suppliers and | -79,434 | -144,878 | -289,969 | | employees | | | | -------------------------------------------------------------------------------- | Cash flows from operations | 31,606 | 25,421 | 37,985 | | before financial income and | | | | | expenses and taxes | | | | -------------------------------------------------------------------------------- | Interest paid | -1,063 | -3,301 | -5,644 | -------------------------------------------------------------------------------- | Interest received and other | | 1,658 | 233 | | financial income | | | | -------------------------------------------------------------------------------- | Income taxes paid | -699 | -3,132 | -7,275 | -------------------------------------------------------------------------------- | Net cash from operating | 29,844 | 20,645 | 25,299 | | activities (A) | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Cash flows from investing | | | | | activities | | | | -------------------------------------------------------------------------------- | Purchase of tangible and | -2,008 | -4,397 | -9,906 | | intangible assets | | | | -------------------------------------------------------------------------------- | Proceeds from sale of tangible | 43 | 0 | 4 | | and intangible assets | | | | -------------------------------------------------------------------------------- | Investments | -485 | 0 | -21,589 | -------------------------------------------------------------------------------- | Loans granted | -2 | -7 | -9 | -------------------------------------------------------------------------------- | Amortisations of loan received | 2 | 40 | 44 | -------------------------------------------------------------------------------- | Dividends received | 0 | 0 | 1 | -------------------------------------------------------------------------------- | Net cash flow from investing | -2,450 | -4,365 | -31,455 | | activities (B) | | | | -------------------------------------------------------------------------------- | Cash flow after investing | 27,394 | 16,280 | -6,156 | | activities (A+B) | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Cash flows from financing | | | | | activities | | | | -------------------------------------------------------------------------------- | Drawing of credits | 0 | 1,429 | 37,313 | -------------------------------------------------------------------------------- | Amortisations of credits | -17,813 | -8,642 | -21,011 | -------------------------------------------------------------------------------- | Dividends paid | -2,694 | -8,028 | -8,104 | -------------------------------------------------------------------------------- | Net cash used in financing | -20,507 | -15,241 | 8,198 | | activities (C) | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Net increase (+) or decrease (-) | 6,887 | 1,040 | 2,042 | | in cash and equivalents (A+B+C) | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | KEY FINANCIAL INDICATORS | 1-6/09 | 1-6/08 | 1-12/08 12 | | | 6 mon. | 6 mon. | mon. | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Net sales, 1000 EUR | 99,582 | 173,661 | 311,713 | -------------------------------------------------------------------------------- | Operating profit/loss, 1000 EUR | -5,500 | 18,968 | 21,039 | -------------------------------------------------------------------------------- | % of net sales | -5.5 | 10.9 | 6.7 | -------------------------------------------------------------------------------- | Profit/loss before taxes, 1000 | -6,417 | 17,117 | 15,228 | | EUR | | | | -------------------------------------------------------------------------------- | % of net sales | -6.4 | 9.9 | 4.9 | -------------------------------------------------------------------------------- | Net profit/loss for the period, | -7,368 | 11,939 | 5,519 | | 1000 EUR | | | | -------------------------------------------------------------------------------- | % of net sales | -7.4 | 6.9 | 1.8 | -------------------------------------------------------------------------------- | Return on equity (ROE), % | -20.1 | 28.4 | 6.9 | -------------------------------------------------------------------------------- | Return on investments (ROI), % | -0.8 | 23.9 | 14.5 | -------------------------------------------------------------------------------- | Net liabilities, 1000 EUR | 33,474 | 36,322 | 59,518 | -------------------------------------------------------------------------------- | Gearing, % | 49.1 | 42.0 | 75.7 | -------------------------------------------------------------------------------- | Equity ratio, % | 42.5 | 48.6 | 41.9 | -------------------------------------------------------------------------------- | Current ratio | 1.9 | 1.8 | 1.9 | -------------------------------------------------------------------------------- | Gross capital expenditure, 1000 | 2,000 | 3,890 | 27,426 | | EUR | | | | -------------------------------------------------------------------------------- | % of net sales | 2.0 | 2.2 | 8.8 | -------------------------------------------------------------------------------- | R&D expenditures, 1000 EUR | 2,884 | 3,240 | 5,812 | -------------------------------------------------------------------------------- | % of net sales | 2.9 | 1.9 | 1.9 | -------------------------------------------------------------------------------- | Personnel average | 4,768 | 5,638 | 5,588 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | PER-SHARE KEY FIGURES | 1-6/09 | 1-6/08 | 1-12/08 12 | | | 6 mon. | 6 mon. | mon. | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Earnings per share (EPS), EUR | -0.41 | 0.67 | 0.31 | -------------------------------------------------------------------------------- | Earnings per share | -0.45 | 0.67 | 0.31 | | (EPS),diluted, EUR | | | | -------------------------------------------------------------------------------- | Equity per share, EUR | 3.83 | 4.82 | 4.40 | -------------------------------------------------------------------------------- | Share price at close of period, | 3.60 | 6.97 | 3.25 | | EUR | | | | -------------------------------------------------------------------------------- | Lowest share price, EUR | 2.70 | 6.88 | 2.82 | -------------------------------------------------------------------------------- | Highest share price, EUR | 4.44 | 9.48 | 9.48 | -------------------------------------------------------------------------------- | Average share price, EUR | 3.59 | 7.60 | 6.56 | -------------------------------------------------------------------------------- | Turnover in shares, 1000 shares | 4,437 | 7,551 | 12,941 | -------------------------------------------------------------------------------- | Turnover in shares per (share | 25.0 | 42.5 | 72.8 | | issue adjusted) share capital, % | | | | -------------------------------------------------------------------------------- | Average number of shares, 1000 | 17,782 | 17,782 | 17,782 | | shares | | | | -------------------------------------------------------------------------------- | Average number of shares, | 16,442 | 17,698 | 17,782 | | diluted,1000 shares | | | | -------------------------------------------------------------------------------- | Shares at end of period, 1000 | 17,782 | 17,782 | 17,782 | | shares | | | | -------------------------------------------------------------------------------- | Market capitalisation , 1000 EUR | 64,013 | 123,937 | 57,790 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | 1. SEGMENT INFORMATION | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | 1.1.-30.6.2009 (1 000 | Wiring | Electronics | Eliminations | Group | | EUR) | Harness | | | Total | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Sales to external | 74,804 | 24,778 | | 99,582 | | customers | | | | | -------------------------------------------------------------------------------- | Sales to other segment | 67 | 20 | -87 | 0 | -------------------------------------------------------------------------------- | Net sales to other | 74,872 | 24,797 | -87 | 99,582 | | segments, 1000 EUR | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Operating profit/loss | -6,876 | 1,377 | 0 | -5,500 | -------------------------------------------------------------------------------- | % of net sales | -9.2 | 5.6 | | -5.5 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Segments assets | 118,842 | 39,191 | | 158,033 | -------------------------------------------------------------------------------- | Unallocated assets *) | | | | 2,288 | -------------------------------------------------------------------------------- | Assets total | 118,842 | 39,191 | | 160,321 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | * Segments assets do not include deferred taxes | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | 1.1.-30.6.2008 (1 000 | Wiring | Electronics | Eliminations | Group | | EUR) | Harness | | | Total | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Sales to external | 138,615 | 35,046 | | 173,661 | | customers | | | | | -------------------------------------------------------------------------------- | Sales to other segment | 131 | 467 | -598 | 0 | -------------------------------------------------------------------------------- | Net sales to other | 138,746 | 35,513 | -598 | 173,661 | | segments, 1000 EUR | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Operating profit/loss | 12,104 | 6,863 | 0 | 18,968 | -------------------------------------------------------------------------------- | % of net sales | 8.7 | 19.6 | | 10.9 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Segments assets | 138,324 | 35,989 | | 174,314 | -------------------------------------------------------------------------------- | Unallocated assets *) | | | | 3,795 | -------------------------------------------------------------------------------- | Assets total | 138,324 | 35,989 | | 178,109 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | * Segments assets do not include deferred taxes | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | 1.1.-31.12.2008 (1 000 | Wiring | Electronics | Eliminations | Group | | EUR) | Harness | | | Total | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Sales to external | 246,487 | 65,226 | | 311,713 | | customers | | | | | -------------------------------------------------------------------------------- | Sales to other segment | 193 | 671 | -864 | 0 | -------------------------------------------------------------------------------- | Net sales to other | 246,680 | 65,897 | -864 | 311,713 | | segments, 1000 EUR | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Operating profit/loss | 9,744 | 11,295 | 0 | 21,039 | -------------------------------------------------------------------------------- | % of net sales | 4.0 | 17.3 | | 6.7 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Segments assets | 152,765 | 38,044 | -4,994 | 185,815 | -------------------------------------------------------------------------------- | Unallocated assets *) | | | | 1,623 | -------------------------------------------------------------------------------- | Assets total | 152,765 | 38,044 | -4,994 | 187,438 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | * Segments assets do not include deferred taxes | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | NET SALES BY | 4-6/09 | 4-6/08 | 1-6/09 | 1-6/08 | 1-12/08 | | GEOGRAPHICAL SEGMENTS | 3 mon. | 3 mon. | 6 mon. | 6 mon. | 12 mon. | | (1000 EUR) | | | | | | -------------------------------------------------------------------------------- | Finland | 9,810 | 14,908 | 20,362 | 30,513 | 58,621 | -------------------------------------------------------------------------------- | Other Europe | 23,269 | 44,955 | 52,172 | 89,995 | 151,701 | -------------------------------------------------------------------------------- | North America | 4,798 | 9,248 | 9,658 | 18,587 | 33,427 | -------------------------------------------------------------------------------- | South America | 4,492 | 13,102 | 9,745 | 23,814 | 48,510 | -------------------------------------------------------------------------------- | Other Countries | 3,462 | 6,356 | 7,645 | 10,752 | 19,453 | -------------------------------------------------------------------------------- | Total | 45,831 | 88,569 | 99,582 | 173,661 | 311,713 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | 2. RECONCILIATION OF EQUITY (MILLION EUR) | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | A = Share Capital | -------------------------------------------------------------------------------- | B = Share premium account | -------------------------------------------------------------------------------- | C = Fair value and other reserves | -------------------------------------------------------------------------------- | D = Retained earnings | -------------------------------------------------------------------------------- | E = Minority interest | -------------------------------------------------------------------------------- | F = Total equity | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | | A | B | C | D | E | F | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Shareholders' equity | 6.0 | 4.9 | 0.2 | 71.1 | 0.8 | 83.0 | | 1.1.2008 | | | | | | | -------------------------------------------------------------------------------- | Profit/loss for the | 0.0 | 0.0 | 0.0 | 11.8 | 0.0 | 11.8 | | period | | | | | | | -------------------------------------------------------------------------------- | Dividends | 0.0 | 0.0 | 0.0 | -8.0 | 0.0 | -8.0 | -------------------------------------------------------------------------------- | Share options used | 0.0 | 0.0 | 0.0 | 0.2 | 0.0 | 0.2 | -------------------------------------------------------------------------------- | Translation | 0.0 | 0.0 | 0.0 | -0.7 | 0.0 | -0.7 | | differences | | | | | | | -------------------------------------------------------------------------------- | Other changes | 0.0 | 0.0 | 0.1 | 0.2 | 0.0 | 0.3 | -------------------------------------------------------------------------------- | Shareholders' equity | 6.0 | 4.9 | 0.3 | 74.6 | 0.8 | 86.6 | | 31.3.2008 | | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Shareholders' equity | 6.0 | 4.9 | 0.4 | 67.1 | 0.3 | 78.6 | | 1.1.2009 | | | | | | | -------------------------------------------------------------------------------- | Profit/loss for the | 0.0 | 0.0 | 0.0 | -7.4 | 0.0 | -7.4 | | period | | | | | | | -------------------------------------------------------------------------------- | Dividends | 0.0 | 0.0 | 0.0 | -2.7 | 0.0 | -2.7 | -------------------------------------------------------------------------------- | Share-based payments | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | -------------------------------------------------------------------------------- | Translation | 0.0 | 0.0 | 0.0 | -0.4 | 0.0 | -0.4 | | differences | | | | | | | -------------------------------------------------------------------------------- | Acquisitions of | 0.0 | 0.0 | 0.0 | 0.3 | -0.3 | 0.0 | | minority interest | | | | | | | -------------------------------------------------------------------------------- | Shareholders' equity | 6.0 | 4.9 | 0.4 | 56.9 | 0.0 | 68.2 | | 31.3.2009 | | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | 3. CONTINGENT LIABILITIES AT | 6/09 | 6/08 | 12/08 | | | END OF PERIOD (1000 EUR) | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Leasing liabilities | 9,872 | 5,752 | 11,745 | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Liabilities for derivate | | | | | | instruments | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Nominal values | | | | | -------------------------------------------------------------------------------- | Currency derivates | | | | | -------------------------------------------------------------------------------- | Forward contracts | 2,096 | 3,719 | 3,307 | | -------------------------------------------------------------------------------- | Option agreements | | | | | -------------------------------------------------------------------------------- | Call | 873 | 1,756 | 757 | | -------------------------------------------------------------------------------- | Total | 2,969 | 5,475 | 4,064 | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Fair values | | | | | -------------------------------------------------------------------------------- | Currency derivates | | | | | -------------------------------------------------------------------------------- | Forward contracts | -39 | -124 | -195 | | -------------------------------------------------------------------------------- | Option agreements | | | | | -------------------------------------------------------------------------------- | Call | 0 | -74 | 0 | | -------------------------------------------------------------------------------- | Total | -39 | -198 | -195 | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Currency derivates are used only in hedging currency risks. PKC Group does | | not apply hedge accounting to derivate instruments in accordance with IAS | | 39. Fair values of the derivates are entered directly in the income | | statement. | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | 4. QUARTERLY KEY | 1-3/08 | 4-6/08 | 7-9/08 | 10-12/ | 1-3/09 | 4-6/09 | | FIGURES, | 3 mon. | 3 mon. | 3 mon. | 08 3 | 3 mon. | 3 mon. | | CONSOLIDATED | | | | mon. | | | -------------------------------------------------------------------------------- | Net sales, 1000 EUR | 85.09 | 88.57 | 73.37 | 64.68 | 53.75 | 45.83 | -------------------------------------------------------------------------------- | Operating | 9.34 | 9.63 | 6.0 | -3.93 | 0.1 | -5.59 | | profit/loss, 1000 EUR | | | | | | | -------------------------------------------------------------------------------- | % of net sales | 11.0 | 10.9 | 8.2 | -6.1 | 0.2 | -12.2 | -------------------------------------------------------------------------------- | Profit/loss before | 7.31 | 9.81 | 5.54 | -7.43 | -1.89 | -4.53 | | taxes, 1000 EUR | | | | | | | -------------------------------------------------------------------------------- | % of net sales | 8.6 | 11.1 | 7.6 | -11.5 | -3.5 | -9.9 | -------------------------------------------------------------------------------- | Equity ratio, % | 46.0 | 48.6 | 50.0 | 41.9 | 42.9 | 42.5 | -------------------------------------------------------------------------------- | Earnings per share | 0.26 | 0.41 | 0.17 | -0.53 | -0.20 | -0.25 | | (EPS), diluted (EUR) | | | | | | | -------------------------------------------------------------------------------- | Shareholders equity | 4.39 | 4.82 | 5.06 | 4.40 | 4.05 | 3.83 | | per share, EUR | | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | QUARTERLY KEY | | | | | | | | FIGURES, WIRING | | | | | | | | HARNESSESS | | | | | | | -------------------------------------------------------------------------------- | Net sales, 1000 EUR | 69.32 | 69.29 | 56.95 | 50.77 | 41.7 | 33.1 | -------------------------------------------------------------------------------- | Operating | 7.02 | 5.09 | 3.86 | -6.2 | -0.59 | -6.29 | | profit/loss, 1000 EUR | | | | | | | -------------------------------------------------------------------------------- | % of net sales | 10.1 | 7.3 | 6.8 | -12.2 | -1.4 | -19.0 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | QUARTERLY KEY | | | | | | | | FIGURES, ELECTRONICS | | | | | | | -------------------------------------------------------------------------------- | Net sales, 1000 EUR | 15.77 | 19.28 | 16.42 | 13.91 | 12.05 | 12.73 | -------------------------------------------------------------------------------- | Operating | 2.32 | 4.54 | 2.14 | 2.29 | 0.68 | 0.69 | | profit/loss, 1000 EUR | | | | | | | -------------------------------------------------------------------------------- | % of net sales | 14.7 | 23.5 | 13.1 | 16.4 | 5.7 | 5.4 | -------------------------------------------------------------------------------- This unaudited interim report has been prepared in accordance with the accounting policies set out in International Accounting Standard 34 on Interim Financial Reporting and in the Group's Annual Report for 2008, except for the effects of the adoption of the standards described below: IFRS 8 Operating Segments The Group's reportable segments remain unchanged from those reported in previous interim reports. The adoption of this standard has had no impact on the reported results or financial position of the Group. IAS 1 Presentation of Financial Statements The revised standard has introduced a number of terminology changes and revised titles for the primary statements, however the adoption of this standard has had no impact on the reported results or financial position of the Group. CALCULATION OF INDICATORS Return on equity (ROE), % = 100 x Profit/loss / Shareholders' equity (average) Return on investments (ROI), % = 100 x (Profit/loss + financial expenses) / Balance sheet total + interest-bearing liabilities (average) Gearing, % = 100 x (Interest-bearing liabilities - cash in hand and at bank and investments) / Shareholders' equity + minority interest Equity ratio, % = 100 x (Shareholders' equity + minority interest) / Balance sheet total - advance payments received Quick ratio = Receivables and cash in hand and at bank / Current liabilities - advance payments received Current ratio Receivables and cash in hand and at bank + inventories / Current liabilities Earnings per share (EPS), EUR Profit before extraordinary items - income taxes +/- minority interest / Average share issue-adjusted number of shares Shareholders' equity per share, EUR Shareholders' equity / Share issue-adjusted number of shares on the balance sheet date Market capitalisation Number of shares at the end of the financial period x the last trading price of the financial period All the future estimates and forecasts presented in this stock exchange release are based on the best current knowledge of the company's management. The estimates and forecasts contain certain elements of risk and uncertainty which, if they materialise, may lead to results that differ from present estimates. The main factors of uncertainty are related, among other things, to the general economic situation, the trend in the operating environment and the sector as well as the success of the Group's strategy. PKC GROUP OYJ Board of Directors Harri Suutari President and CEO For additional information, contact: Harri Suutari, President & CEO, PKC Group Oyj, +358 400 384 937 PRESS CONFERENCE A press conference to be held in Finnish on the January-June/2009 Interim Report will be arranged for analysts and investors on Thursday 6 August 2009 at 10:00 a.m. A press conference to be held in English will be arranged at noon. Both conferences will be arranged as virtual conferences that can be joined in on through the PKC Group website. DISTRIBUTION NASDAQ OMX Main media www.pkcgroup.com The PKC Group offers design and contract manufacturing services for wiring harnesses, cabling and electronics. The Group has production facilities in Finland, Brazil, China, Mexico, Poland, Estonia and Russia. The Group's net sales in 2008 totalled EUR 311.7 million. PKC Group Oyj is listed on NASDAQ OMX Helsinki Ltd.
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