2015-02-12 08:30:00 CET
2015-02-12 08:30:03 CET
REGULATED INFORMATION
Honkarakenne Oyj - Financial Statement Release
HONKARAKENNE OYJ’S FINANCIAL STATEMENT RELEASE 1 JANUARY - 31 DECEMBER 2014
HONKARAKENNE OYJ FINANCIAL STATEMENT RELEASE 12 February 2015 at 9.30 a.m.
HONKARAKENNE OYJ'S FINANCIAL STATEMENT RELEASE 1 JANUARY - 31 DECEMBER 2014
SUMMARY
Net sales for 2014 saw a year-on-year decline of 6 %. Net sales grew in both
Finland & Baltics and Russia & CIS, but decreased significantly in Global
Markets. The result before taxes remained in the red. Net sales in the fourth
quarter were down 33 % on the corresponding period of the previous year. The
Group's order book was 31 % smaller at the end of the year than in 2013.
October - December 2014
-- Honkarakenne Group's consolidated net sales for the last quarter of the
year amounted to MEUR 11.5 (MEUR 17.0 in 2013),
representing a decrease over the same period the previous year of 33 %
-- Operating profit/loss was MEUR -0.3 (MEUR 0.1). Operating profit/loss
without non-recurring items was MEUR -0.1 (MEUR 0.7)
-- Loss before taxes was MEUR -0.4 (MEUR -0.1)
-- Earnings per share amounted to EUR -0.04 (EUR -0.07)
Year 2014
-- Honkarakenne Group's consolidated net sales for the entire year was MEUR
45.5 (48.3),
representing a decrease over the same period the previous year of 6 %
-- Operating loss was MEUR -2.2 (MEUR -1.7). Operating loss before
non-recurring items was MEUR -2.0 (MEUR -1.1)
-- Loss before taxes was MEUR -2.5 (MEUR -1.7)
-- Earnings per share amounted to EUR
-0.40 (EUR -0.32)
As a result of the efficiency-boosting measures and co-operation negotiations
concluded during the fourth quarter, non-recurring expenses of MEUR 0.2 were
recognised for the 2014 financial year.
The Board of Directors proposes to the Annual General Meeting that no dividend
be paid for the financial year ended 31 December 2014.
According the Honkarakenne's view net sales may decline in 2015 from previous
year due to the situation in Russia. The result before non-recurring items and
taxes is estimated to improve due to the development programme initiated by the
Group.
At the end of December, the Group's order book stood at MEUR 12.5, down 31 % on
the corresponding period of the previous year, when it stood at MEUR 18.1. The
order book refers to orders whose delivery date falls within the next 24
months. Some orders may include terms and conditions relating to financing or
building permits.
KEY INDICATORS 10-12/ 10-12/ 1-12/ 1-12/
2014 2013 2014 2013
Net sales, MEUR 11.5 17.0 45.5 48.3
Operating profit/loss, MEUR -0.3 0.1 -2.2 -1.7
Operating profit before non-recurring items, MEUR -0.1 0.7 -2.0 -1.1
Profit/loss before taxes, MEUR -0.4 -0.1 -2.5 -1.7
Average number of personnel 151 190 161 213
Personnel in person-years, average 119 189 146 185
Earnings/share (EPS), EUR -0.04 -0.07 -0.40 -0.32
Equity ratio, % 37 38
Return on equity, % -20 -13
Shareholders' equity/share, EUR 1,80 2,20
Gearing, % 92 57
Mikko Kilpeläinen, President and CEO of Honkarakenne Oyj, in connection with
the financial statement release: "The trend in net sales in Finland, Russia and CIS was satisfactory compared to
the previous year. However, price competition - particularly in Finland -
weakened Honkarakenne's profitability. In Global Markets, net sales were down
due to the scarcity of major construction projects and in Central Europe the
measures taken to improve profitability.
During the fourth quarter, Honkarakenne initiated a development programme
aiming at savings of MEUR 3. The development programme is expected to come into
full effect during the third quarter of 2015. As part of the programme,
Honkarakenne engaged in co-operation negotiations in November-December. These
negotiations resulted in reductions of 17 person-years, which were largely
implemented by laying off personnel for an indefinite period.
In 2014, Honkarakenne made strong outlays on the development of detached house
collections in Finland. We launched both ready-to-move-in houses and the
Healthy House model collection. I believe that these outlays will generate
growth for Honkarakenne in the future. A growing number of people want
ready-to-move-in houses. Honkarakenne ready-to-move-in Healthy House model
collection lifted Honkarakenne to a new level in modern urban housing. Healthy
living is in ever-rising demand among customers. Our Healthy House model
collection was developed to cater to all the requirements of healthy living -
the concept takes into account not only indoor air quality, acoustics and
illumination, but also the entire construction process.
As the next step from the Healthy House consept, Honkarakenne implemented a
healthy daycare centre in Oulu on a turnkey basis in the fourth quarter. Good
indoor air quality is particularly important at daycare centres.
Area development projects continued to develop well in Russia & CIS markets.
The Ukrainian situation, the price of oil and strong exchange rate fluctuations
currently cause uncertainty in the Russian market and hinder sales forecasts.
Net sales in Global Markets fell short of the previous year. The major factors
were the scarcity of project sales compared with 2013 and the measures taken to
improve profitability in Central Europe. In addition, in the case of Japan, the
unfavourable currency exchange trend and the sales tax hike implemented in
early 2014 both weakened net sales.
Honkarakenne launched sales in China, a future growth area, in the first part
of the year. The first deliveries to China were made during the latter half.
China is a rapidly growing market and I believe there will be rising demand for
high-quality, solid timber housing in the future. Wellbeing and a healthy and
ecological living environment are global megatrends. Our product range meets
these requirements very well. Honkarakenne seeks to take on a major role in
developing this segment in China.”
NET SALES
Honkarakenne Group's net sales for the year 2014 decreased by 6 per cent to
MEUR 45.5 (MEUR 48.3).
The Group's last-quarter net sales in 2014 decreased by 33 per cent to MEUR
11.5 (MEUR 17.0).
Geographical distribution of net sales:
DEVELOPMENT OF SALES
Distribution of 1-12 1-12
net sales, % /2014 /2013
Finland & Baltics 48 % 42 %
Russia & CIS 31 % 27 %
Global Markets 20 % 31 %
Total 100 % 100 %
Net sales, MEUR 10-12 10-12 % change 1-12 1-12 % change
/2014 /2013 /2014 /2013
Finland & Baltics 4.6 5.0 -8 22.0 20.3 8
Russia & CIS 4.2 5.0 -15 14.3 12.8 11
Global Markets 2.6 7.1 -63 9.3 15.2 -39
Total 11.5 17.0 -33 45.5 48.3 -6
Finland & Baltics includes the following countries: Finland, Estonia, Latvia
and Lithuania. It includes also Process waste sales for recycling which was
reported separately before.
Russia & CIS includes the following countries: Russia, Azerbaijan, Kazakhstan,
Ukraine and other CIS countries. Global Markets includes other countries than above-mentioned.
The Group's order book stood at MEUR 12.5 at the end of December. In the
previous year at the same time period it was MEUR 18.1.
TRENDS IN PROFIT AND PROFITABILITY
The operating loss in 2014 was MEUR -2.2 (MEUR -1.7) and the result before
taxes MEUR -2.5 (MEUR -1.7). The result includes a provision of MEUR 0.2 (MEUR
0.6) associated with personnel reductions and efficiency measurements.
The operating loss without non-recurring items in January-December was MEUR
-2.0 (MEUR -1.1). This year-on-year change in the operating result without
non-recurring items was influenced particularly by both the reduced price level
in Finland and the scarcity of project sales in Global Markets.
During the fourth quarter, Honkarakenne initiated a development programme
aiming at savings of MEUR 3. The development programme is expected to come into
full effect during the third quarter of 2015. In addition modernization
investments finalized in 2014 and centralizing operations in Karstula are
expected to improve profitability.
FINANCING AND INVESTMENTS
The financial position of the Group was satisfactory at the end of the report
period. The equity ratio stood at 37 % (38 %) and net financial liabilities at
MEUR 8.2 (MEUR 6.1). MEUR 2.0 (MEUR 3.4) of the financial liabilities carries a
30 % equity ratio covenant term. Group liquid assets totalled MEUR 1.0 (MEUR
3.2). The Group also has a MEUR 8.0 (MEUR 8.0) bank overdraft facility, MEUR
4.2 of which had been drawn on at the end of the report period (MEUR 5.6).
Gearing stood at 92 % (57 %).
The Group's capital expenditure on fixed assets totalled MEUR 0.9 (MEUR 3.7),
while the Group's depreciation amounted to MEUR 2.2 (MEUR 2.3).
PRODUCTS AND MARKETING
In Finland & Baltics, Honkarakenne continued its outlays on increasing sales of
detached houses. The major overhaul was the launch of ready-to-move-in
solutions and the Healthy House model collection. The Healthy House model
collection is Honka's spearhead for growth in the Finnish detached house
segment. The Healthy House model collection was developed to cater to all the
requirements of healthy living - the concept takes into account not only indoor
air quality, acoustics and illumination, but also the entire construction
process. In addition, these houses are also available as convenient
ready-to-move-in packages. The Healthy House solution has been tested and
approved by VTT Technical Research Centre of Finland.
The Healthy House concept was introduced at the Jyväskylä Housing Fair, where
it was well-received.
The Lounatuuli model from the detached house collection was voted as Finland's
best detached house in a competition on the rakentaja.fi website in early 2014.
During the fourth quarter, the Birgitta cafe, delivered by Honkarakenne, was
chosen as the Finnish Log Building of the Year.
Honkarakenne ventured into a new business area by delivering a daycare centre
in Oulu on a turnkey basis in the fourth quarter. A healthy daycare centre is
the logical evolution of Honkarakenne's Healthy House concept.
In Russia & CIS, the company continued to work on area development projects in
Russia with a local dealer. In Russia, construction is increasingly focusing on
area development projects in which several Honkarakenne projects are
implemented in a single area. In addition, the company started up more
systematic sales in major cities other than St Petersburg and Moscow.
The Ukrainian crisis, the price of oil and exchange rate fluctuations were
reflected in the Russian market, especially in the fourth quarter. Honkarakenne
is keeping a close eye on the situation. In spite of the Ukrainian situation,
net sales in both Russia and Ukraine saw year-on-year growth.
In Global Markets, net sales fell short of the previous year. The major factors
were the scarcity of project sales compared with 2013 and the measures taken to
improve profitability in Central Europe. In addition, in the case of Japan, the
unfavourable currency exchange trend and the sales tax hike implemented in
early 2014 both weakened net sales.
Honkarakenne launched sales in China, a future growth area, in the first part
of the year. The first deliveries to China were made during the latter half.
China is a rapidly growing market and Honkarakenne believes that there will be
rising demand for high-quality, solid timber housing in the future. Wellbeing
and a healthy and ecological living environment are global megatrends.
Honkarakenne's product range meets these requirements very well. Honkarakenne
seeks to take on a major role in developing this segment in China.
RESEARCH AND DEVELOPMENT
In R&D, we continued to develop the ready-to-move-in range and Healthy House
model collection in the Finnish detached house market. In addition, the
company's R&D continued to focus on the special features of the Chinese market
in sales of Honkarakenne's log houses.
In the January-December period, the Group's R&D expenditure totalled MEUR 0.5
(MEUR 0.4), representing 1.0 % of net sales (0.8 %). The Group did not
capitalise any development expenditure during the financial year.
STAFF
In terms of person years, the Group employed a total of 146 (185) people in
average in 2014, representing a year-on-year decrease of 39.
In 2014 the Group employed 161 (213) people on average. By the end of the year,
the Group employed 148 (178) people.
In November-December Honkarakenne concluded negotiations under the act on
co-operation within undertakings in Finland and based on these negotiations the
company decided on efficiency actions including reduction of 17 person-years
which were largely implemented by laying off personnel for an indefinite
period. In addition, the company agreed on temporary lay-offs for a maximum of
90 days during March - December 2015 concerning clerical and managerial
employees in Finland.
MANAGEMENT
Honkarakenne reorganised its functions at the beginning of December. With this
reorganisation, Honkarakenne streamlined its operations with a view to seeking
growth and better profitability. Resources were targeted at developing sales
and marketing, the importer and dealer network, and the company's collection
development. In spite of the personnel reductions that were carried out,
Honkarakenne will continue to invest in Russia, CIS and Asia, as the company
sees major long-term growth potential in these markets, particularly China.
Reorganization included changes in company's executive group. Since the
beginning of December the new executive group has been Mikko Kilpeläinen,
president and CEO, Mika Koivisto, sales area Finland, Pekka Elo, sales area
Global Markets, Peter Morinov, sales area Russia and CIS-countries, Tanja
Rytkönen, model collections and design, Erja Heiskanen, operations and Mikko
Jaskari, finance. President and CEO Mikko Kilpeläinen is personally in charge
of company's product management development. Sami Leinonen left Honkarakenne's
service at the beginning of December.
LONG-TERM INCENTIVE PLAN
In the second quarter of 2013, the Board of Directors decided on a long-term
share-based incentive plan for members of the Executive Group. The performance
period of the new plan began on 1 January 2013 and will end on 31 December
2016. The potential reward for the performance period is based on the
cumulative earnings per share (EPS) for 2013 - 2016 and on the average return
on capital employed (ROCE) for 2013 - 2016. Any rewards for the performance
period 2013 - 2016 will be paid partly as B shares and partly in cash in 2017.
The rewards to be paid on the basis of the performance period will correspond
to a total maximum of about 340,000 B shares, including the amount to be paid
in cash.
In financial year 2014 the amount of allocated shares was 4,191 (10,484). These
allocated shares are recognized as follows: 5 (31) thousand euros employee
benefit expenses, 0 (3) thousand euros deduction in taxes and increase in
deferred tax assets and 7 (16) thousand euros direct in retained earnings.
HONKARAKENNE OYJ'S 2014 ANNUAL GENERAL MEETING, BOARD OF DIRECTORS, AND AUDITORS
The Annual General Meeting of Honkarakenne Oyj was held at the company's
headquarters in Tuusula on 4 April 2014. The AGM approved the parent company's
and the consolidated Financial Statements, and discharged the members of the
Board of Directors and the CEO from liability for 2013. The AGM decided not to
pay a dividend for the 2013 financial year.
Teijo Pankko and Mauri Saarelainen were re-elected to the Board of Directors.
Arto Tiitinen, Anita Saarelainen and Hannu Krook were elected to the Board as
new members. At the Board's constituent meeting, Arto Tiitinen was elected
Chairman of the Board. Mauri Saarelainen was elected as Deputy Chairman. The
Board of Directors decided not to elect any committees from among its members.
PricewaterhouseCoopers Oy, member of the Finnish Institute of Authorised Public
Accountants, was re-appointed as auditor of the company, with Maria Grönroos,
APA, as chief auditor.
HONKARAKENNE OYJ's DIRECTED ISSUE, OWN SHARES AND BOARD AUTHORISATIONS
On the basis of an authorisation to issue shares granted to the Board of
Directors at the Annual General Meeting of 5 April 2013, the Board decided (on
10 January 2014) to arrange a directed issue to Honkarakenne employees. The
Board approved a total of 42,451 subscriptions for new Series B shares through
the directed issue. The Series B shares subscribed for through the directed
issue represent about 0.9 per cent of the total number of Series B shares and
the voting rights conferred by them. 62 company employees subscribed for shares
through the directed issue. Shares were offered to a total of 146 employees.
The total number of Series B shares increased to 4,911,323 shares after the new
shares were registered in the Trade Register.
At the end of the financial year, the total number of Honkarakenne Oyj shares
entered in the Trade Register amounted to 5,211,419, of which 300,096 were
Series A shares and 4,911,323 Series B shares. Each B share carries one (1)
vote and each A share carries twenty (20) votes. Hence, Honkarakenne's shares
in aggregate carry a total of 10,913,243 votes. The company's registered share
capital is EUR 9,897,936.00.
Honkarakenne has not acquired its own shares during the report period. At the
end of the report period, the Group held 364,385 of its Honkarakenne B shares
with a total purchase price of EUR 1,381,750.23. These shares represent 6.99 %
of the company's all shares and 3.34 % of all votes. The purchase cost has been
deducted from shareholders' equity in the consolidated financial statements.
On 4 April 2014, the AGM decided that the Board of Directors will be authorised
to acquire a maximum of 400,000 of the company's own B shares with assets
included in the company's unrestricted equity. In addition, the AGM authorised
the Board to decide on a rights issue or bonus issue and on granting special
rights to shares referred to in Section 1 of Chapter 10 of the Limited
Liability Companies Act in one or more instalments. By virtue of the
authorisation, the Board may issue a maximum total of 400,000 new shares and/or
relinquish old B shares held by the company, including those shares that can be
issued by virtue of special rights. Both authorisations will be valid until 25
March 2015.
CORPORATE GOVERNANCE
Honkarakenne Oyj follows the Limited Liability Companies Act and the Finnish
Corporate Governance Code, 1 October 2010, for listed companies issued by the
Finnish Securities Market Association. The company's website, www.honka.com,
provides more information on the corporate governance systems.
FUTURE OUTLOOK
At the end of December, the Group's order book stood at MEUR 12.5, down 31 % on
the corresponding period of the previous year, when it stood at MEUR 18.1. The
order book refers to orders whose delivery date falls within the next 24
months. Some orders may include terms and conditions relating to financing or
building permits.
FORTHCOMING RISKS AND UNCERTAINTIES
Russia is one of Honkarakenne's major business territories. The Ukrainian
crisis, the trend in the price of oil and strong exchange rate fluctuations
currently cause instability in the Russian market. This might have major
impacts on Honkarakenne's operations. Honkarakenne is keeping a close eye on
the development of the Russian situation.
The assessment of amounts in the balance sheet is based on current assessment
by the management. If these assessments are changed, this may result in changes
to the Group's result.
It is currently more difficult to acquire funding from the financial markets.
REPORTING
This report contains statements that relate to the future, and these statements
are based on hypotheses that the company's management hold currently as well as
on the decisions and plans that are currently in place. Although the management
believes that the hypotheses relating to the future are well-founded, there is
no guarantee that the said hypotheses will prove to be correct.
This financial statement release has been drafted in accordance with IAS 34.
The principles adhered to in preparing the annual financial statements 2013
also apply to this financial statement release but new and amended IFRS
standards and interpretations effective in 2014 have been applied. Amended
standards and interpretations effective from the beginning of year 2014 have no
bearing on the figures presented for the report period.
The figures have not been examined by the auditor.
EVENTS AFTER THE REVIEW PERIOD
No significant events.
PROPOSAL OF THE BOARD OF DIRECTORS ON THE USE OF PROFIT FUNDS
The parent company has no distributable funds and no funds can be allocated as
profits. The parent company posted a MEUR -2.7 loss for the financial year.
The Board of Directors proposes to the Annual General Meeting that no dividend
be paid for the financial year ended 31 December 2014.
THE OUTLOOK FOR 2015
According the Honkarakenne's view net sales may decline in 2015 from previous
year due to the situation in Russia. The result before non-recurring items and
taxes is estimated to improve due to the development programme initiated by the
Group.
GENERAL MEETING
The Annual General Meeting of Honkarakenne Oyj will be held at the company's
headquarters in Tuusula on Friday 17 April 2015 at 2:00 pm.
HONKARAKENNE OYJ
Board of Directors
Further information:
Mikko Kilpeläinen, President and CEO, tel. +358 50 542 5884,
mikko.kilpelainen@honka.com or
Mikko Jaskari, CFO, tel. +358 400 535 337, mikko.jaskari@honka.com.
This and previous releases are available for viewing on the company's website
at www.honka.com.
Honkarakenne will publish the Directors' Report and financial statements for
2014 as well as a separate Corporate Governance Statement on the company's
website at www.honka.com latest in week 13. Interim Reports for 2015 will be
published on 7 May 2015, 6 August 2015 and 29 October 2015.
DISTRIBUTION
NASDAQ OMX Helsinki
Key media
Financial Supervisory Authority
www.honka.com
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
unaudited 10-12 10-12 1-12 1-12
/2014 /2013 /2014 /2013
MEUR
Net sales 11.5 17.0 45.5 48.3
Other operating income 0.1 0.1 0.5 0.4
Change in inventories -1.8 -1.0 -2.1 0.9
Materials and services -6.0 -10.0 -29.2 -30.9
Employee benefit expenses -2.0 -3.6 -8.3 -10.9
Depreciations and amortisation -0.6 -0.4 -2.2 -2.3
Impairment -0.0 -0.2 -0.0 -0.2
Other operating expenses -1.4 -1.9 -6.4 -6.9
Operating profit/loss -0.3 0.1 -2.2 -1.7
Financial income 0.1 0.3 0.1 0.8
Financial expenses -0.2 -0.5 -0.5 -0.7
Share of associated companies' result -0.0 0.0 -0.0 -0.0
Profit/loss before taxes -0.4 -0.1 -2.5 -1.7
Taxes 0.2 -0.3 0.6 0.1
Profit/loss for the period -0.2 -0.3 -1.9 -1.5
Other comprehensive income
Translation differences -0.1 -0.2 -0.0 -0.4
Total comprehensive -0.3 -0.5 -2.0 -2.0
income for the period
Result for the period attributable to
Equity holders of the parent -0.2 -0.3 -1.9 -1.5
Non-controlling interest -0.0 -0.0 -0.0 0.0
-0.2 -0.3 -1.9 -1.5
Comprehensive income attributable to
Equity holders of the parent -0.3 -0.5 -2.0 -2.0
Non-controlling interest -0.0 -0.0 -0.0 0.0
-0.3 -0.5 -2.0 -2.0
Calculated from the result for the period
attributable to equity holders of parent
Earnings/share (EPS), EUR
Basic -0.04 -0.07 -0.40 -0.32
Diluted -0.04 -0.07 -0.40 -0.32
Honkarakenne Oyj has two series of shares: A shares and B shares, which have
different right to dividend. Profit distribution of 0.20 EUR per share will be
paid first for B shares, then 0.20 EUR per share for A shares, followed by
equal distribution of remaining profit distribution between all shares.
CONSOLIDATED BALANCE SHEET 31.12.2014 31.12.2013
Unaudited
MEUR
Assets
Non-current assets
Property, plant and equipment 14.5 15.9
Goodwill 0.1 0.1
Other intangible assets 0.3 0.5
Investments in associated companies 0.3 0.3
Receivables 0.2 0.2
Deferred tax assets 2.1 1.5
17.5 18.4
Current assets
Inventories 4.9 7.1
Trade and other receivables 4.5 5.2
Cash and bank receivables 1.0 3.2
10.4 15.6
Total assets 27.9 34.0
Shareholders' equity and liabilities 31.12.2014 31.12.2013
Equity attributable to equity holders
of the parent company
Share capital 9.9 9.9
Share premium account 0.5 0.5
Fund for invested unrestricted equity 6.5 6.4
Own shares -1.4 -1.4
Translation differences -0.2 -0.2
Retained earnings -6.6 -4.7
8.7 10.6
Non-controlling interests 0.2 0.2
Total equity 8.9 10.8
Non-current liabilities
Deferred tax liabilities 0.0 0.1
Provisions 0.3 0.5
Financial liabilities 7.4 7.5
7.7 8.1
Current liabilities
Trade and other payables 8.8 12.3
Current tax liabilities 0.0 0.2
Provisions 0.6 0.9
Current financial liabilities 1.8 1.8
11.3 15.1
Total liabilities 19.0 23.2
Total equity and liabilities 27.9 34.0
STATEMENT OF CHANGES IN EQUITY
abridged
Unaudited
EUR thousand Equity attributable to equity holders of
the parent
a) b) c) d) e) f) Total g) Total
equity
Total equity 9898 520 6828 224 -1382 -3178 12909 209 13117
1.1.2013
Profit/loss for the -1546 -1546 1 -1545
period
Translation difference -421 -421 -421
Repayment of capital -384 -384 -384
Management incentive 16 16 16
plan
Total equity 31.12.2013 9898 520 6444 -197 -1382 -4710 10573 211 10784
Equity attributable to equity holders of
the parent
a) b) c) d) e) f) Total g) Total
equity
Total equity 9898 520 6444 -197 -1382 -4710 10573 211 10784
1.1.2014
Profit/loss for the -1936 -1936 -7 -1942
period
Translation difference -18 -18 -18
Directed share issue 90 90 90
Management incentive 7 7 7
plan
Total equity 9898 520 6534 -215 -1382 -6638 8716 204 8920
31.12.2014
a) Share capital
b) Share premium account
c) Fund for invested unrestricted equity
d) Translation difference
e) Own shares
f) Retained earnings
g) Non-controlling interests
CONSOLIDATED STATEMENT OF CASH FLOWS 1.1.- 1.1.-
abridged 31.12.2014 31.12.2013
unaudited
MEUR
Cash flow from operating activities -0.8 -1.2
Cash flow from investing activities, net -1.3 -3.0
Total cash flows from financing activities -0.2 2.6
Share issue 0.1
Repayment of capital -0.4
Proceeds from borrowings 3.0 5.6
Repayment of borrowings -3.1 -2.4
Other financial items -0.1 -0.2
Change in cash and cash equivalents -1.9 -1.6
Cash and cash equivalents at the beginning of period 3.2 4.8
Cash and cash equivalents at the close of period 1.0 3.2
NOTES TO THE REPORT
Accounting policies
This financial statement release has been drafted in accordance with IAS 34.
The principles adhered to in preparing the annual financial statements 2013
also apply to this financial statement release but new and amended IFRS
standards and interpretations effective in 2014 have been applied. Amended
standards and interpretations effective from the beginning of year 2014 have no
bearing on the figures presented for the report period.
The figures have not been examined by the auditor.
Honka Management Oy, which is a company established in 2010 by members of
company's Executive Group, is included in the consolidated financial statements
due to the terms and conditions of the shareholder agreement concluded between
it and Honkarakenne Oyj.
Honkarakenne has three geographical operating segments that have been combined
into one segment for reporting purposes. Geographically, sales are divided as
follows: Finland & Baltics, Russia & CIS and Global Markets. The internal
reporting of the management is in line with IFRS reporting. For this reason,
separate reconciliations are not presented.
Property, plant and equipment
Property, plant and
equipment
MEUR
Cost 1.1.2014 65.7
Increase 0.8
Disposals -0.6
Cost 31.12.2014 65.9
Accumulated depreciation 1.1.2014 -49.8
Translation differences (+/-) -0.2
Accumulated depreciation of disposals and 0.6
reclassifications
Depreciation for the period -1.9
Accumulated depreciation 31.12.2014 -51.4
Carrying amount 1.1.2014 15.9
Carrying amount 31.12.2014 14.5
Non-recurring expenses
The co-operation negotiations that ended in the last quarter and efficiency
activities resulted in MEUR 0.2 being recognised as non-recurring expenses for
the financial year 2014.
Own shares
Honkarakenne has not acquired its own shares during the report period. At the
end of the report period, the Group held 364,385 of its Honkarakenne B shares
with a total purchase price of EUR 1,381,750.23. These shares represent 6.99 %
of the company's all shares and 3.34 % of all votes. The purchase cost has been
deducted from shareholders' equity in the consolidated financial statements.
Contingent liabilities
Unaudited 31.12.2014 31.12.2013
MEUR
For own loans
- Mortgages 25,7 25,7
- Other quarantees 2,1 2,3
Rental liabilities 0,4 0,6
Leasing liabilities 0,4 0,2
Nominal values of forward exchange contracts 1,7 1,7
Derivative contracts 0,3 0,4
Events with related parties
The Group's related parties consist of subsidiaries and associated companies;
the company's management and any companies in which they exert influence; and
those involved in the Saarelainen shareholder agreement and any companies
controlled by them. The management personnel considered to be related parties
comprise the Board of Directors, President & CEO, and the company's Executive
Group. The pricing of goods and services in transactions with related parties
conforms to market-based pricing.
During the report period, ordinary business transactions with related parties
were made as follows: the sales to the related parties were EUR 381 thousand
and the purchases from the related parties were EUR 497 thousand. In 2010 and
2011, Honkarakenne Oyj granted long-term loans totalling MEUR 0.9 to Honka
Management Oy, which is owned by the company's senior management.
KEY INDICATORS 1-12 1-12
Unaudited 2014 2013
Earnings/share (EPS) euro -0.40 -0.32
Return on equity % -20 -13
Equity ratio % 37 38
Shareholders equity/share euro 1.80 2.20
Net financial liabilities MEUR 8.2 6.1
Gearing % 92 57
Gross investments MEUR 0.9 3.7
% of net sales 2 8
Order book MEUR 12.5 18.1
Personnel in person-years, average Staff 81 104
Workers 66 82
Total 146 185
Calculation of key indicators
Profit for the period
attributable to equity holders
of parent
Earnings/share (EPS) --------------------------------
---------------
Average number of outstanding
shares
Result before taxes - taxes
Return on equity % -------------------------------- x 100
---------------
Total equity, average
Total equity
Equity ratio, % -------------------------------- x 100
---------------
Balance sheet total - advances
received
Net financial liabilities Financial liabilities - cash and
cash equivalents
Financial liabilities - cash and
cash equivalents
Gearing, % -------------------------------- x 100
-----------
Total equity
Shareholders' equity
Shareholders equity/share --------------------------------
----------------
Number of shares outstanding at the
close of period
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