2010-10-22 07:30:00 CEST
2010-10-22 07:30:02 CEST
REGULATED INFORMATION
Scanfil - Interim report (Q1 and Q3)
SCANFIL GROUP'S INTERIM REPORT 1 JANUARY - 30 SEPTEMBER 2010
SCANFIL PLC INTERIM REPORT 22 OCTOBER 2010 8.30 A.M.
SCANFIL GROUP'S INTERIM REPORT 1 JANUARY - 30 SEPTEMBER 2010
January - September
- Turnover totalled to EUR 157.2 million (1-9 2009: 149.2), up 5.3%
- Operating profit EUR 11.2 (13.4) million, 7.1% (9.0%) of turnover
- Operating profit without non-recurring items EUR 8.7 million, 5.5% of turnover
- Profit for the review period was EUR 9.3 (11.6) million
- Earnings per share were EUR 0.16 (0.20)
- Due to forecasted strong demand during the last quarter, Scanfil estimates
that the turnover of contract manufacturing business for 2010 will increase
clearly. Previously, Scanfil estimated that its turnover would increase
slightly on the level of 2009.
July - September
- Turnover totalled EUR 62.5 million (Q3 2009: 49.6) up 25.8%
- Operating profit EUR 3.5 (4.2) million, 5.6% (8.5%) of turnover
- Profit was EUR 3.3 (3.8) million, 5.3% (7.6%)
- Earnings per share amounted EUR 0.06 (0.06)
Non-recurring items include a sales gain of EUR 2.5 million from the Oulu
property, recognised in the second quarter.
Harri Takanen, President of Scanfil plc:
”Scanfil plc's active investment operations continued in the third quarter with
two new strategic investments, one in plastics technology (IonPhasE) and one in
the contract manufacturing industry (Kitron). In our judgment, the 32.96%
holding acquired in the Norwegian listed contract manufacturer of electronic
equipment Kitron ASA is a significant investment. With this ownership
arrangement, we will further reinforce our position in the global contract
manufacturing market.
With regard to contract manufacturing, the development of demand has been
positive in the telecommunications markets as well as professional electronics
products since the end of the first quarter. In terms of sales, the third
quarter was the best quarter in four years. We expect solid demand for the rest
of the year and that full-year sales will increase clearly, even though sales
are limited by component shortages and, in part, also the sufficiency of
capacity.”
DEVELOPMENT OF OPERATIONS
Scanfil plc
Scanfil plc is Scanfil Group's parent company and investment company whose goal
is to invest the company's assets profitably in companies that operate in select
business sectors. Scanfil plc's investment portfolio is divided into three
parts. The first part contains money market investments including risk-free
interest investments (deposits), low-risk investments (business loans) and
moderate risk investments (structured instruments). The second part contains
liquid high-yield, ETF and equity investments. The third part consists strategic
investments. Scanfil plc's current target allocation in terms of these three
main groups is 20-35%, 10-15% and 50-70%, respectively. At the end of the review
period, the allocation division per main group was 44%, 3% and 52%,
respectively.
The average duration of the structured instruments in the investment portfolio
is less than three years, and their share of the portfolio is less than 20%. As
a whole, the investment activity has reached set targets and investments have
developed favourably also on third quarter despite the nervous market
environment.
During the period under review, Scanfil plc made two new strategic investments,
with Scanfil plc acquiring a 40% holding in IonPhasE Oy and a 32.96% holding in
the Norwegian listed contract manufacturing group Kitron ASA. The total purchase
price of the Kitron ASA shares was EUR 18.1 million.
Based on own patented technology, IonPhasE manufactures dissipative polymers
that help to control static electricity in plastic products. IonPhasE products
are utilised in a wide range of industries, such as chemical, automotive,
telecommunications and consumer electronics. The company has interesting global
customer accounts with significant growth potential.
Scanfil plc's 32.96% holding in Norwegian listed Kitron ASA strengthens
significant position in the industry. From the customers' point of view, Scanfil
EMS and Kitron ASA are clearly the leading and most competitive contract
manufacturing partners in the Nordic countries. Kitron ASA operates in five
different customer segments: the marine and oil industry, basic industry,
defence equipment industry, hospital and healthcare equipment industry and data
and telecommunications industry. In addition to Norway, Kitron ASA has plants
and production in Sweden, Lithuania, Germany, China and, as of the beginning of
2011, also in the United States. Kitron ASA's strengths are long-term customer
relationships and manufacturing agreements as well as specialised contract
manufacturing competence. Kitron ASA's turnover in 2009 was NOK 1,730.7 million
(about EUR 218.5 million) and the company had approximately 1,100 employees.
As of the beginning of the fourth quarter, Kitron ASA will be Scanfil Group's
associated company. The purchase price of the holding of approximately one-third
also corresponds to one-third of Kitron ASA's equity, which means that the
ownership arrangement will not increase the goodwill on Scanfil Group's balance
sheet.
With regard to other strategic investments, the business operations of Lännen
Tehtaat plc continued to develop favourably also during the second quarter of
2010 in spite of industrial action in the food industry. Lännen Tehtaat comments
that this year's operating profit will be at least on a par with the reference
year. Due to seasonality, the fourth quarter is essential with regard to the
full-year financial result. The business operations of the locking system
company iLOQ Oy, Panphonics Oy and IonPhasE Oy have continued to develop as
planned.
Scanfil EMS Subgroup
The strong increase in demand in contract manufacturing continued during the
third quarter. January-September turnover totalled EUR 157.2 million, a growth
of 5.3% compared with the same period last year. The third quarter turnover was
EUR 62.5 million, significantly better (+26%) than the corresponding quarter
last year. Turnover for this year's July to September was the highest turnover
for an individual quarter since the third quarter of 2006.
During the period under review, demand grew positively in both
telecommunications and professional electronics products. The growth of the
demand for telecommunications products has been slightly stronger throughout the
period under review. In spite of the increase in total demand, strong
fluctuation has continued in customer-specific demand during the period.
Professional electronics customers accounted for 49% of total sales in the
review period (45% during the corresponding period in 2009) and
telecommunications customers for 51% (55%) of total sales. The customer division
and sales monitoring of Scanfil EMS subgroup has been reorganised to better
match customers' product range and the company's internal reporting. The new
customer groups are professional electronics customers and telecommunications
customers. The reorganisation will increase the proportion of professional
electronics customers by 2 to 3 percentage points compared to the previous
arrangement.
The efforts to develop the quality of operations and production flow in Scanfil
EMS Group's foreign subsidiaries and Finnish units continued during the period
under review.
The acquisition of new facilities for the subsidiary located in Suzhou has
proceeded according to plan. Moving the operations to the new facilities is
planned by the end of January 2011.
In the third quarter, Scanfil EMS Oy acquired a 40% holding in Greenpoint Oy and
signed a supply contract with the company. Greenpoint Oy is specialised in
developing various activation solutions, equipment and tools to drive impulse
sales of fast moving consumer goods for brands and retail chains. Any essential
effects of the agreement will not be seen in this year's result.
FINANCIAL DEVELOPMENT
Scanfil Group
The Group's turnover for January - September was EUR 157.2 (149.2) million, up
5.3% year-on-year. Distribution of turnover based on the location of customers
was as follows: Finland 31% (38%), rest of Europe 24% (21%), Asia 43% (40%), USA
1% (1%) and others 1% (1%).
The Chinese subsidiaries' sales accounted for 47 % (43 %) of the Group's sales
during the review period including deliveries to the Group's other plants.
Operating profit of the Group during the review period was EUR 11.2 (13.4)
million, representing 7.1% (9.0%) of turnover. Operating profit includes a
non-recurring property sales gain of EUR 2.5 million, recognised in the second
quarter. Operating profit without the sales gain was EUR 8.7 million,
representing 5.5% of turnover. Earnings for the review period amounted to EUR
9.3 (11.6) million. Earnings per share were EUR 0.16 (0.20) and return on
investment was 10.9% (15.3%).
Scanfil EMS Subgroup
The turnover of contract manufacturing operations amounted to EUR 157.2 (149.2)
million in January-September. Operating profit for the review period was EUR 8.1
(12.9) million, or 5.1% (8.6%) of turnover. The result amounted to EUR 5.0 (8.1)
million, or 3.2% (5.5%) of turnover. The development of profitability was still
affected by the global problems faced by both the company and its customers in
the availability of certain electronics components, which increased costs and
limited sales to some degree. Also, rising raw material prices have increased
costs.
Return on investment was 11.6% (20.7%), equity ratio was 39.3% (37.5%) and
gearing 32.9% (-25.5%). The significant change in gearing is due to the return
of capital to the parent company carried out in the autumn of 2009.
Turnover amounted to EUR 62.5 (49.6) million in July - September. Operating
profit for the third quarter was EUR 3.3 (4.0) million, or 5.3% (8.0%) of
turnover. Profit for the quarter was EUR 2.2 (1.8) million.
Investment activities
The gains and losses from non-strategic investments by the Group's parent
company, Scanfil plc, are recognised under financial income and expenses in the
income statement. In January-September, recognised interest income and capital
gains amounted to EUR 3.2 (1.7) million, realised sales losses amounted to EUR
0.6 (1.4) million, and value changes of financial assets at fair value through
profit or loss amounted to EUR -0.2 (2.6) million, resulting in a total recorded
value of EUR 2.4 (4.3) million.
In July-September 2010, realised capital gains amounted to EUR 1.2 million.
The sold investments were mainly ETF and high-yield investments.
Strategic investments (Lännen Tehtaat plc and ILOQ Oy) that do not fulfil the
definition of associated companies, are measured at fair value, and the change
in the value, EUR 1.9 million, is recognised in the fair value reserve under
equity, adjusted with tax liabilities, net EUR 1.4 million.
The strategic investments that fulfil the definition of an associated company
are Panphonics Oy, IonPhasE Oy and Kitron ASA, and the share in their profit,
EUR -0.5 million, has been recognised through profit or loss.
The associated company Greenpoint Oy is classified as an operational investment,
and it is owned by Scanfil EMS Oy, the share in the associated company's profit
is EUR -0.1 million.
FINANCING AND CAPITAL EXPENDITURE
The Group enjoys a strong financial position.
The consolidated balance sheet totalled EUR 216.0 (195.2) million. Liabilities
amounted to EUR 58.7 (48.3) million, EUR 53.7 (36.3) million of which were
non-interest-bearing and EUR 5.0 (12.0) million interest-bearing. The equity
ratio was 72.8% (75.3)% and gearing -30.8% (-50.6)%.
Financial assets totalled EUR 53.4 (86.3) million, of which EUR 26.7 (26.7)
million has been deposited in bank accounts and in time deposits with maturity
of three months or less.
An additional EUR 26.8 (54.9) million of financial assets was invested in
financial instruments, mainly in bonds, credit linked notes, structured
investment instruments and ETF and equity investments. In compliance with the
IFRS, the investments have been measured at fair value. The net result for
January-September includes EUR -0.2 (2.6) million of change in the fair value of
the investments.
Strategic investments have been made during 2010 for a total of EUR 22.1
million, of which the biggest was the acquisition of shares in Kitron ASA, EUR
18.1 million.
Cash flows from operating activities in review period of January - September was
EUR -2.2 (26.0) million. EUR 10.9 million was tied to working capital whereas in
the corresponding period last year, the amount of working capital that became
available was EUR 14.4 million. In addition to turnover growth, an increase in
inventories due to weak availability of electronics components and long delivery
times has had an effect on working capital commitment. Cash flow from investment
activities consists mainly of the parent company's investment activities,
investments in financial instruments and the associated companies, as well as of
the proceeds from the sales of the Oulu property. Cash flow from financing
activities, EUR -13.9 (-8.5) million, contains proceeds from borrowings, EUR 5.0
million, the repayment of a loan taken by the Estonian subsidiary, EUR 12.0
million, and dividend payments amounting to EUR 6.9 million.
Gross investments in fixed assets totalled EUR 2.2 (2.6) million, which is 1.4%
(1.7%) of turnover. Depreciations were EUR 3.8 (3.8) million.
In the statement of comprehensive income, the major change in translation
differences, EUR -4.8 million, is due to the translation of the equity of the
Chinese subsidiaries into the euro. The currency of China, renminbi, is tied-up
with the US dollar and has weakened about 10% during the quarter with the
weakening of the US dollar. Changes in exchange rates have not had a significant
effect on the result of operational activity due to the business structure.
BOARD OF DIRECTORS' AUTHORISATION
The Annual General Meeting decided on 8 April 2010 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 has no existing share issue authorisations or
authorisations to issue convertible bonds with warrants.
OWN SHARES
On 30 September 2010, the company owned a total of 2,983,831 of its own shares
that represented 4.9 % of the company's share capital and votes.
During the review period, the company disposed of 4,522 of its own shares in
conjunction with the share-based profit-sharing scheme of the Group's Management
Team.
SHARE TRADING AND SHARE PERFORMANCE
The highest trading price during the review period was EUR 3.14 and the lowest
EUR 2.40, the closing price for the period standing at EUR 2.89. A total of
3,590,703 shares were traded during the period, corresponding to 5.9% of the
total number of shares. The market value of the shares on 30 September 2010 was
EUR 175.5 million.
PERSONNEL
Scanfil Group's personnel averaged 2,142 (2,063) employees during the review
period and the company employed 2,361 (2,120) employees at the end of the review
period, of whom 1,897 (1,598) were employed in the company's foreign plants. In
all, 80 (75) % of the Group's personnel were employed by subsidiaries outside
Finland on 30 September 2010.
EVENTS AFTER THE REVIEW PERIOD
The nomination committee of Kitron ASA proposes to the company's extraordinary
general meeting to be held on 8 November 2010 that the board member of Scanfil
pcl Asa-Matti Lyytinen and President of Scanfil plc Harri Takanen shall be
elected to board members of Kitron ASA until the annual general meeting of 2012.
The nomination committee proposes also that the member of board of Scanfil plc
Tuomo Lähdesmäki shall be elected to member of the nomination committee of
Kitron ASA until the annual general meeting of 2012.
FUTURE PROSPECTS
Scanfil plc
The company will continue its active operations in the market by exploring new
investment opportunities in its current and new lines of business in order to
ensure a good return on its investments. Scanfil plc Group's financial position
offers a good opportunity for acquisitions conforming to the investment
strategy, aiming to obtain a stake in select companies that facilitates active
influence on their operations.
The Group will also continue to invest its cash reserves in accordance with its
investment policy.
Scanfil EMS Subgroup
Due to forecasted strong demand during the last quarter, Scanfil EMS Oy
estimates that its turnover for 2010 will increase clearly. Previously, Scanfil
estimated that its turnover would increase slightly on the level of 2009. The
operating profit for the full year is estimated to reach a satisfactory level.
OPERATIONAL RISKS AND UNCERTAINTIES
Risks and uncertainties associated with investment activities have not changed
compared to the previous interim report. The most significant short-term risks
associated with investment activities may materialise if the global economy
recovers at a pace slower than expected and the impact of the economic recovery
policy weakens globally. On the other hand, if the recovery is faster than
expected, the resulting increasing inflation expectations and tightening
monetary policy might result in a rapid increase of interest rates and
accelerating inflation. Both alternatives would have immediate impacts on the
stock market and be visible as increasing market volatility.
The continued poor demand predictability of contract manufacturing clients
constitutes an operational risk in the short term that is hard to estimate. Both
the Scanfil EMS subgroup and some of its customers have had problems in the
availability of certain electronics components. Continued weak availability of
components may have an impact on the operations of the Scanfil EMS subgroup and
some of its customers, thereby also influencing Scanfil's sales and
profitability.
In other respects, the risks facing Scanfil's business have remained essentially
the same. 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 2009.
The Group has adopted the revised standard IFRS 3 Business Combinations and the
revised standard IAS 27 Consolidated and Separate Financial Statements as from
the beginning of 2010. They have not had an impact on the interim report.
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
2010 2009 2010 2009 2009
7 - 9 7 - 9 1 - 9 1 - 9 1 - 12
TURNOVER 62.5 49.6 157.2 149.2 197.3
Changes in inventories of finished
goods and work in progress 0.8 - 1.0 1.8 - 3.5 - 4.1
Other operating income 0.1 0.4 3.2 0.8 1.2
Expenses - 58.6 - 43.6 - 147.1 - 129.3 - 173.4
Depreciation - 1.3 - 1.2 - 3.8 - 3.8 - 5.1
OPERATING PROFIT 3.5 4.2 11.2 13.4 16.0
Financial income and expenses 2.1 2.2 2.4 3.8 5.1
Share in the associated
company's profit - 0.6 - 0.6
PROFIT BEFORE TAXES 5.0 6.4 13.0 17.2 21.1
Income taxes - 1.7 - 2.7 - 3.7 - 5.6 - 6.7
NET PROFIT FOR THE PERIOD 3.3 3.8 9.3 11.6 14.3
Attributable to:
Equity holders of the parent 3.3 3.8 9.3 11.6 14.3
Earnings/share (EPS), EUR 0.06 0.06 0.16 0.20 0.25
The company does not have items that might dilute the earnings per share.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
EUR million 2010 2009 2010 2009 2009
7 - 9 7 - 9 1 - 9 1 - 9 1 - 12
NET PROFIT FOR THE PERIOD 3.3 3.8 9.3 11.6 14.3
Other comprehensive income
Translation differences - 4.8 - 1.4 3.3 - 2.5 - 1.9
Available-for-sale investments 0.7 1.1 0.3
Other comprehensive income,
net of tax - 4.1 - 1.4 4.4 - 2.5 - 1.6
TOTAL COMPREHENSIVE INCOME - 0.8 2.4 13.7 9.1 12.8
Attributable to:
Equity holders of the parent - 0.8 2.4 13.7 9.1 12.8
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
EUR million
30.9. 30.9. 31.12.
2010 2009 2009
ASSETS
Non-current assets
Property, plant and equipment 30.2 32.0 31.1
Goodwill 2.4 2.4 2.4
Other intangible assets 0.8 1.2 1.1
Shares in associated companies 23.9
Available-for-sale investments 12.2 0.0 10.6
Financial assets at fair value
through profit or loss 19.3 11.4 14.5
Deferred tax assets 0.2 0.1 0.1
Total non-current assets 88.9 47.1 59.9
Current assets
Inventories 38.5 25.6 24.7
Trade and other receivables 54.3 42.8 43.4
Advance payments 0.3 0.1 0.1
Financial assets at fair value
through profit or loss 7.5 43.5 16.1
Available-for-sale investments, liquid assets 4.7 0.5
Available-for-sale investments,
cash equivalents 14.7 12.8 20.4
Cash and cash equivalents 12.0 13.9 30.8
Total current assets 127.1 143.4 135.9
Non-current assets held for sale 4.6 4.9
TOTAL ASSETS 216.0 195.2 200.7
SHAREHOLDERS' EQUITY AND LIABILITIES
Equity
Share capital 15.2 15.2 15.2
Share premium account 16.1 16.1 16.1
Treasury shares - 8.9 - 8.9 - 8.9
Translation differences 3.4 - 0.5 0.1
Other reserves 6.6 4.4 4.7
Retained earnings 124.9 120.6 123.3
Total equity 157.3 146.9 150.5
Non-current assets
Deferred tax liabilities 1.2 1.4 1.5
Provisions 4.8 5.3 5.4
Other liabilities 1.7
Total non-current liabilities 7.7 6.7 6.9
Current liabilities
Trade and other liabilities 43.4 28.6 30.1
Current tax 2.6 0.9 1.2
Interest bearing liabilities 5.0 12.0 12.0
Total current liabilities 51.1 41.6 43.3
Total liabilities 58.7 48.3 50.2
TOTAL SHAREHOLDERS' EQUITY
AND LIABILITIES 216.0 195.2 200.7
CALCULATION OF CHANGES IN CONSOLIDATED SHAREHOLDERS´ EQUITY
EUR million
A = Share capital
B = Share premium account
C = Treasury shares
D = Translation differences
E = Other reserves
F = Retained earnings
G = Equity total
SHAREHOLDERS´ EQUITY A B C D E F G
1.1.2010 15.2 16.1 - 8.9 0.1 4.7 123.3 150.5
TOTAL COMPREHENSIVE INCOME 3.3 1.1 9.3 13.7
Payment of dividends - 6.9 - 6.9
Transfer to funds 0.8 - 0.8 0
Distribution of treasury shares 0.0 0.0
SHAREHOLDERS' EQUITY
30.9.2010 15.2 16.1 - 8.9 3.4 6.6 124.9 157.3
SHAREHOLDERS' EQUITY A B C D E F G
1.1.2009 15.2 16.1 - 7.4 2.0 3.5 116.9 146.2
TOTAL COMPREHENSIVE INCOME - 2.5 11.6 9.1
Payment of dividends - 7.0 - 7.0
Transfer to funds 0.9 - 0.9 0
Distribution of treasury shares 0.0 0.0
Acquisition of treasury shares - 1.5 - 1.5
SHAREHOLDERS' EQUITY
30.9.2009 15.2 16.1 - 8.9 - 0.5 4.4 120.6 146.9
CONSOLIDATED CASH FLOW STATEMENT
EUR million
2010 2009 2009
1 - 9 1 - 9 1 - 12
Cash flow from operating activities
Net profit 9.3 11.6 14.3
Adjustments for the net profit 2.2 4.6 6.0
Change in net working capital - 10.9 14.4 16.3
Paid interests and other financial expenses - 0.4 - 0.7 - 0.9
Interest received 0.4 0.5 0.7
Taxes paid - 2.8 - 4.5 - 5.5
Net cash from operating activities - 2.2 26.0 30.9
Cash flow from investing activities
Investments in tangible and
intangible assets - 1.0 - 2.9 - 3.4
Sale of tangible and intangible assets 7.5 0.2 0.2
Purchase of investments - 19.4 - 51.3 - 88.3
Proceeds from sale of investments 24.8 17.6 74.1
Purchase of associated companies - 22.8
Granted loans - 0.1
Interest received from investments 0.6 1.4 1.9
Dividends received from investments 0.5 0.0 0.0
Net cash from investing activities - 9.9 - 35.1 - 15.4
Cash flow from financing activities
Purchase of treasury shares - 1.5 - 1.5
Proceeds from short-term loans 5.0
Repayment of short-term loans - 12.0
Dividends paid - 6.9 - 7.0 - 7.0
Net cash from financing activities - 13.9 - 8.5 - 8.5
Net increase/decrease in cash and
cash equivalents - 26.1 - 17.5 7.1
Cash and cash equivalents
at beginning of period 51.2 45.1 45.1
Changes in exchange rates 1.5 - 0.9 - 0.9
Cash and cash equivalents
at end of period 26.7 26.7 51.2
KEY FINANCIAL INDICATORS 2010 2009 2009
1 - 9 1 - 9 1 - 12
Return on equity, % 8.0 10.6 9.7
Return on investment, % 10.9 15.3 13.9
Interest bearing liabilities, EUR million 5.0 12.0 12.0
Gearing, % - 30.8 - 50.6 - 46.7
Equity ratio, % 72.8 75.3 75.0
Gross investments in fixed assets, EUR million 2.2 2.6 3.1
% of turnover 1.4 1.7 1.6
Personnel, average 2 142 2 063 2 064
Earnings per share, EUR 0.16 0.20 0.25
Equity per share, EUR 2.72 2.54 2.61
Number of shares at end of
period, 000´s 60 714 60 714 60 714
- not counting own shares 57 730 57 726 57 726
- weighted average 57 730 58 082 57 992
The company does not have any liabilities resulting from derivative instruments.
Owing to the nature of the sector, the order book of company covers only a short
period of time and does not give an accurate picture of future development.
SEGMENT INFORMATION
EUR million
2010 2009 2009
1 - 9 1 - 9 1 - 12
TURNOVER
Europe 86.7 89.5 113.5
Asia 78.1 67.5 93.2
Turnover between segments - 7.6 - 7.8 - 9.4
Total 157.2 149.2 197.3
OPERATING PROFIT
Europe 3.9 3.5 2.6
Asia 7.3 10.0 13.4
Total 11.2 13.4 16.0
ASSETS
Europe 75.9 73.3 68.4
Asia 72.5 52.3 60.4
Goodwill 2.4 2.4 2.4
Financial assets 65.3 67.2 69.6
Total 216.0 195.2 200.7
The financial assets of investment activities comprise all of Scanfil plc's
financial assets, strategic investments including associated companies and all
deposits by subsidiaries with a maturity exceeding three months, classified as
investment assets. The result of investment activities before tax was EUR 1.9
million (EUR 4.3 million in 2009).
CHANGES IN TANGIBLE NON CURRENT ASSETS
EUR million
2010 2009 2009
1 - 9 1 - 9 1 - 12
Book value at the beginning of the period 31.1 33.7 33.7
Additions 2.0 2.5 2.9
Deductions - 0.0 - 0.1 - 0.4
Depreciations - 3.0 - 3.5 - 4.7
Exchange rate differences 0.1 - 0.5 - 0.4
Book value at the end of the period 30.2 32.0 31.1
ACQUIRED ASSOCIATED COMPANIES
EUR million
Kitron ASA IonPhasE Oy Panphonics Oy Greenpoint Oy Total
Acquisition 09/10 07/10 06/10 08/10
Share 32.96 % 40 % 40 % 40 %
Acquisition cost 18.1 2.0 2.0 2.4 24.5
Share of equity on
acquisition date 18.1 0.7 0.3 0.0 19.2
Difference 0.0 1.3 1.7 2.4 5.3
Allocated to following items:
Product development,
depreciation, 5 years 1.2 1.4 2.4 5.0
Patents, depreciation, 5 years 0.1 0.3 0.3
The acquisition cost of the share of Greenpoint Oy, EUR 2.4 million, includes
estimated conditional transaction price of EUR 1.7 million. Conditional
transaction price will be paid as a share of profitable financial results of
next five accounting periods of Greenpoint Oy.
CONTINGENT LIABILITIES
EUR million 2010 2009 2009
1 - 9 1 - 9 1 - 12
Given real estate mortgages 3.4 3.4 3.4
Given business mortgages 6.8 18.8 18.8
Pledged guarantees 0.1 0.1 0.1
Rental liabilities 0.2 0.3 0.2
Scanfil plc has arranged a EUR 5.2 million bank guarantee to secure the payment
of contributions related to restructuring of Scanfil NV. Balance sheet of
Scanfil NV includes a corresponding provision.
RELATED PARTY TRANSACTIONS
The company has taken out a short-term EUR 5.0 million loan from the Chairman of
the Board of Directors, Jorma Takanen. The interest rate for the loan is the
three-month Euribor + 0.7% and the loan will mature by 28 December 2010. The
loan was used for financing the acquisition of shares in Kitron ASA. No security
has been pledged for the loan.
A loan of a maximum of EUR 300,000 has been issued to Greenpoint Oy, of which
EUR 100,000 has been withdrawn. The loan will mature on 30 June 2012, and its
interest rate is the six-month Euribor + 2.5%.
In June 2010, the company acquired a 40% holding in Panphonics Oy, whose
Chairman of the Board of Directors and one of the shareholders is Asa-Matti
Lyytinen, member of the Scanfil plc Board of Directors.
KEY INDICATORS QUARTERLY
Q3/10 Q2/10 Q1/10 Q4/09 Q3/09 Q2/09 Q1/09 Q4/08
Turnover, MEUR 62.5 53.9 40.8 48.1 49.6 49.9 49.6 54.2
Operating profit, MEUR 3.5 6.2 1.5 2.6 4.2 5.0 4.2 4.5
Operating profit, % 5.6 11.6 3.6 5.3 8.5 10.0 8.5 8.3
Net income, MEUR 3.2 3.9 2.0 2.7 3.8 6.6 1.3 2.3
EPS, EUR 0.06 0.07 0.03 0.05 0.06 0.11 0.02 0.04
SCANFIL PLC
Harri Takanen
President
Additional information:
President Harri Takanen
Tel +358 8 4882 111
Distribution NASDAQ OMX, Helsinki
Major Media
www.scanfil.com
Scanfil Group comprises the investment and parent company Scanfil plc, and a
subgroup called Scanfil EMS Oy, which is engaged in contract manufacturing for
international telecommunications technology and professional electronics
manufacturers. The objective of the investment activities is to make the
management of the company's funds more effective and productive by diversifying
the risks and finding new growth potential.
Scanfil has over 30 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 telecommunications products include 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 are just some examples of the professional
electronics products we manufacture. The company has production facilities in
China, Estonia, Hungary and Finland.
The associated companies of Scanfil Group:
Kitron ASA is a listed Norwegian subcontractor, which operates in five different
customer segments: the marine and oil industry, basic industry, defence
equipment industry, hospital and healthcare equipment industry and data and
telecommunications industry. In addition to Norway, Kitron ASA has plants and
production in Sweden, Lithuania, Germany, China and, as of the beginning of
2011, also in the United States. Kitron ASA's turnover in 2009 was NOK 1,730.7
million (about EUR 218.5 million). www.kitron.com
Greenpoint Oy focuses on development and supply of solutions and equipment,
which improve placements, visibility and sales of customer products in the
Point-Of-Sale. The Greenpoint product portfolio includes a large variety of
refrigerated merchandisers, displays and integrated check-out zone concepts. The
company serves both brand owners and retail chains internationally. Along with
the European markets Greenpoint Oy has entered North and Latin American markets
through partnerships. www.greenpoint.fi
IonPhasE Oy develops and manufactures high performance dissipative polymers that
help to control static electricity. IonPhasE products are utilized in wide range
of industries like chemical, automotive, telecommunication and consumer
electronics. Based on own patented technology, IonPhasE manufactures polymers
called IonPhasE IPE. www.ionphase.fi
Panphonics is the world's leading provider of directional audio solutions.
Panphonics manufactures directional audio solutions for acoustically demanding
applications based on it's own patented technology. Panphonics Sound Shower®
directional audio speakers can be found in banks, retail stores, digital signage
projects, information kiosks, theatres, and offices throughout the world.
Panphonics is also component manufacturer and licensor of plane wave technology
for industrial audio manufacturers and audio solution providers.
www.panphonics.com
Not for release over US newswire services. 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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