2013-10-31 14:00:00 CET
2013-10-31 14:00:12 CET
REGULATED INFORMATION
Honkarakenne Oyj - Interim report (Q1 and Q3)
HONKARAKENNE OYJ’S INTERIM REPORT, 1 JANUARY – 30 SEPTEMBER 2013
HONKARAKENNE OYJ INTERIM REPORT 31 October 2013 at 3:00 p.m.
HONKARAKENNE OYJ'S INTERIM REPORT, 1 JANUARY - 30 SEPTEMBER 2013
SUMMARY
Third-quarter net sales were on a pair with the previous year, the result
before taxes fell short of previous year by EUR 0.3 million. Net sales for the
January-September period were EUR 1 million less than in the previous year, but
the result before taxes was on a par with 2012.
July - September 2013
-- Honkarakenne Group's consolidated net sales for the third quarter of the
year amounted to MEUR 12.4 (MEUR 12.3 in 2012), increase of 1 per cent from
corresponding period in previous year.
-- Operating result was MEUR 0.2 (MEUR 0.5). Operating result before
non-recurring items was MEUR 0.2 (MEUR 0.5).
-- Result before taxes was MEUR 0.1 (MEUR 0.4).
-- Earnings per share amounted to EUR 0.03 (EUR 0.04).
January - September 2013
-- Honkarakenne Group's consolidated net sales for January - September
amounted to MEUR 31.3 (MEUR 32.3), representing a reduction over the same
period the previous year of 3 %.
-- Operating result was MEUR -1.8 (MEUR -1.3).
Operating result before non-recurring items was MEUR -1.8 (MEUR -1.3).
-- Result before taxes was MEUR -1.6 (MEUR -1.6).
-- Earnings per share amounted to EUR -0.26 (EUR -0.25).
-- Equity ratio 42 % (53 %).
-- Gearing 35 % (21 %).
The Group's order book stood at MEUR 21.4 (MEUR 19.0), up 13 % on the
corresponding period of the previous year.
Honkarakenne is revising its outlook and now expects its net sales to be at
same level than in previous year and the result before non-recurring items and
taxes to be close to zero, but negative.
Honkarakenne's previous outlook was the following: in year 2013 Honkarakenne
expects its net sales to be at same level than in previous year and the result
before non-recurring items and taxes to be close to zero.
KEY FIGURES 7-9/ 7-9/ 1-9/ 1-9/ change 1-12/
2013 2012 2013 2012 % 2012
Net sales, MEUR 12.4 12.3 31.3 32.3 -3 46.2
Operating profit/loss, MEUR 0.2 0.5 -1.8 -1.3 -4.3
Operating profit/loss before 0.2 0.5 -1.8 -1.3 -0.8
non-recurring items, MEUR
Profit/loss before taxes, MEUR 0.1 0.4 -1.6 -1.6 -4.4
Average number of personnel 187 257 221 258 257
Personnel in person-years, average 184 224 181 202 198
Earnings/share (EPS), EUR 0.03 0.04 -0.26 -0.25 -0.90
Earnings/share (EPS), diluted EUR 0.03 0.04 -0.26 -0.25 -0.90
Equity ratio, % 42 53 47
Return on equity, % -10 -7 -28
Shareholders' equity/share, EUR 2.30 3.39 2.69
Gearing, % 35 21 11
Mikko Kilpeläinen, President and CEO of Honkarakenne Oyj, in connection with
the interim report:
“Satisfactory trends were seen in net sales in Finland & Baltics, and we have
increased our market share. Sales were quite good considering the market
situation. Marketing focused on the summer's Housing Fair in Hyvinkää.
Net sales in Russia & CIS did not, however, grow as expected. The economic
situation in Russia has furthered weakened and the market outlook is uncertain.
The net sales of Global Markets remained at the same level as in the previous
year. During the third quarter, we decided on efficiency-boosting measures, for
our European cost structure in particular.
We continued to consolidate our operations in Karstula. The first machinery
installations to boost production began at the new production facility.”
NET SALES
Honkarakenne Group's net sales for the third quarter of 2013 decreased by 1 per
cent to MEUR 12.4 (MEUR 12.3).
Geographical distribution of net sales:
DEVELOPMENT OF SALES
Distribution of 1-9 1-9
net sales, % /2013 /2012
Finland & Baltics 45 % 44 %
Russia & CIS 28 % 28 %
Global Markets 27 % 28 %
Total 100 % 100 %
Net sales, MEUR 7-9 7-9 change % 1-9 1-9 change %
/2013 /2012 /2013 /2012
Finland & Baltics 5.5 5.4 3 % 15.3 15.0 2 %
Russia & CIS 3.5 3.5 0 % 7.9 8.0 -1 %
Global Markets 3.4 3.4 0 % 8.1 9.4 -14 %
Total 12.4 12.3 1 % 31.3 32.3 -3 %
Finland & Baltics includes the following countries: Finland, Latvia, Lithuania
and Estonia. It also includes process waste sales for recycling.
Russia & CIS includes the following countries: Russia, Azerbaijan, Kazakhstan,
Ukraine and other CIS countries.
Global Markets includes countries other than the abovementioned.
The Group's order book stood at MEUR 21.4 at the end of September. In the
corresponding period of the previous year, it was MEUR 19.0.
DEVELOPMENT OF PROFIT AND PROFITABILITY
Operating result in January - September was MEUR -1.8 (MEUR -1.3) and result
before taxes was MEUR -1.6 (MEUR -1.6).
FINANCING AND INVESTMENTS
The Group's financial position was satisfactory at the end of report period.
The equity ratio stood at 42 % (53 %) and net financial liabilities at MEUR 3.9
(MEUR 3.5). MEUR 1.7 (MEUR 2.1) of the financial liabilities carry a 30 %
equity ratio covenant term. Group liquid assets totalled MEUR 4.3 (MEUR 2.9).
The Group also has a MEUR 8.0 (MEUR 8.0) bank overdraft facility, MEUR 4.6 of
which had been drawn on at the end of the report period (MEUR 0.0). Gearing
stood at 35 % (21 %).
The Group's capital expenditure totalled MEUR 1.3 (MEUR 0.9). The consolidation
of operations in Karstula has begun and first installations of machinery
equipment to boost production efficiency have been done. Capital expenditure
mainly comprised prepayments for this machinery.
MARKET DEVELOPMENT
According to a report commissioned by RTS Oy, Finnish log house production is
expected to remain on a par with 2012. This prediction includes sales for both
Finland and exports.
PRODUCTS AND MARKETING
In Finland & Baltics, marketing focused on the summer's Housing Fair in
Hyvinkää. Honkarakenne launched a city detached home range inspired by the
customised house showcased at the fair.
In Russia & CIS, the market situation during the early part of the year turned
out to be more difficult than anticipated. Honkarakenne focused on area
development sites in this business area.
In Global Markets, a successful 55th anniversary campaign was run in Japan. The
impact of the campaign will be seen in fourth-quarter net sales. We continued
to develop the cost structure of our European operations, and decided on
efficiency-boosting measures during the third quarter.
RESEARCH AND DEVELOPMENT
R&D centred on improving the processes used in the construction of detached
homes.
In the January - September period, the Group's R&D expenditure totalled MEUR
0.3 (MEUR 0.3), representing 0.8 % of net sales (0.8 %). The Group did not
capitalise any development expenditure during the report period.
PERSONNEL AND MANAGEMENT
During the third quarter, the Group employed an average total of 184 (224)
people in terms of person-years.
At the end of September, the Group's full-year average total stood at 221
employees (258), representing a year-on-year decrease of 37 employees.
In January, the company concluded negotiations under the act on co-operation.
As a result, a decision was taken to consolidate production in Karstula and to
make 68 employees redundant. It was also agreed that the company's personnel in
Finland can be temporarily laid off for a maximum of 90 days until the end of
September 2013.
Petr Morinov, Bachelor of Science, was appointed as the company's Vice
President Sales for Business Area Russia & CIS and a member of the Executive
Group on 30 January 2013.
Master of Science (Architecture) SAFA and Master of Laws, Tanja
Rytkönen-Romppanen, was appointed Vice President, Design and a member of the
Executive Group on 29 April 2013. Her responsibilities include steering design,
Group marketing and R&D.
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.
The company has recorded EUR 18 thousand in costs in the statement of
comprehensive income associated with the incentive scheme.
HONKARAKENNE OYJ'S 2013 ANNUAL GENERAL MEETING, BOARD OF DIRECTORS, AND AUDITORS
The Annual General Meeting (AGM) of Honkarakenne Oyj was held at the company's
headquarters in Tuusula on 5 April 2013. The AGM confirmed the financial
statements of the parent company and Group, and discharged from liability the
board members and CEO for 2012. The AGM decided that no dividends be paid for
the 2012 financial year. The AGM decided that a repayment of capital totalling
EUR 0.08 per share be paid from the Fund for invested unrestricted equity.
Anders Adlercreutz, Lasse Kurkilahti, Mauri Saarelainen, Marko Saarelainen and
Teijo Pankko were re-elected to the Board of Directors. The Board's constituent
meeting appointed Lasse Kurkilahti the Chairman of the Board. Mauri Saarelainen
will serve as the Deputy Chairman. Board of Directors decided not to set up any
committees.
PricewaterhouseCoopers Oy, member of the Finnish Institute of Authorised Public
Accountants, was appointed as auditor of the company, with Maria Grönroos, APA,
as chief auditor.
HONKARAKENNE OYJ'S OWN SHARES AND AUTHORISATIONS OF THE BOARD OF DIRECTORS
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 7.05 %
of the company's capital stock and 3.35 % of all votes. The purchase cost has
been deducted from shareholders' equity in the consolidated financial
statements.
On 5 April 2013, 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 2014.
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
The market situation remains uncertain. General macroeconomic uncertainty
factors, such as the economic situation in Russia, are being reflected in
customers' unwillingness to make decisions on construction projects. Sales
figures are still being impacted by longer sales periods and a scarcity of
longer-term orders.
At the end of September, the Group's order book amounted to MEUR 21.4, up 13 %
on the corresponding period of the previous year, when it was MEUR 19.0. The
order book refers to orders whose delivery date falls within the next 24
months. Some orders may include a financing or building permit condition.
FORTHCOMING RISKS AND UNCERTAINTIES
Customers are taking longer to decide on investments due to general economic
uncertainty. Sales periods have once again lengthened in Russia & CIS in
particular. There is a risk that deals scheduled for completion during the last
quarter will be pushed back to 2014.
Some of the orders may also include financing terms. Banks have begun to
tighten their lending terms, which might make it more difficult for customers
to obtain financing.
The Group has one significant concentration of credit risks in trade
receivables, concerning the open trade receivables of one dealer. No provision
for doubtful debt has been made for this. A payment plan has been made with
this dealer and the amount of the trade receivables has decreased in every
quarter. Payments under this plan will continue until 2015.
The valuation 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.
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 interim report release has been drafted in line with IFRS recognition and
valuation principles. However, not all of the requirements of IAS 34 have been
complied with in its drafting. The interim report is in line with 2012
financial statement. The interim report should be read together with the 2012
financial statements. The new revised standards or interpretations effective as
of 1 January 2013 have no bearing on the figures presented for the report
period. The figures have not been examined by the auditor.
OUTLOOK FOR 2013
Honkarakenne is revising its outlook and now expects its net sales to be at
same level than in previous year and the result before non-recurring items and
taxes to be close to zero, but negative.
Honkarakenne's previous outlook was the following: in year 2013 Honkarakenne
expects its net sales to be at same level than in previous year and the result
before non-recurring items and taxes to be close to zero.
HONKARAKENNE OYJ
Board of Directors
Further information:
Mikko Kilpeläinen, President and CEO, tel. +358 50 542 5884,
mikko.kilpelainen@honka.com
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.
DISTRIBUTION
NASDAQ OMX Helsinki
Key media
Financial Supervisory Authority
www.honka.com
CONSOLIDATED STATEMENT OF COMPREHENSIVE
INCOME
unaudited 7-9 7-9 1-9 1-9 1-12
/2013 /2012 /2013 /2012 /2012
MEUR
Net sales 12.4 12.3 31.3 32.3 46.2
Other operating income 0.0 0.0 0.3 0.6 0.8
Change in inventories of finished and 0.2 -0.4 1.9 0.5 -0.2
unfinished goods
Production for own use 0.0 0.0 0.0 0.0 0.0
Materials and services -7.5 -5.9 -19.6 -18.4 -25.2
Employee benefit expenses -2.4 -2.5 -7.4 -7.7 -12.4
Depreciations and amortisation -0.5 -0.9 -1.9 -2.4 -3.0
Impairment -1.8
Other operating expenses -2.0 -2.1 -6.4 -6.3 -8.7
Operating profit/loss 0.2 0.5 -1.8 -1.3 -4.3
Financial income 0.1 0.1 0.4 0.2 0.6
Financial expenses -0.1 -0.1 -0.2 -0.4 -0.7
Share of result of assosiated companies -0.0 -0.1 -0.1 -0.1 -0.0
Profit/loss before taxes 0.1 0.4 -1.6 -1.6 -4.4
Income taxes -0.0 -0.2 0.4 0.4 0.1
Profit/loss for the period 0.1 0.2 -1.2 -1.2 -4.3
Other comprehensive income:
Translation differences 0.0 0.0 -0.2 0.0 -0.2
Total comprehensive 0.1 0.2 -1.5 -1.2 -4.6
income for the period
Profit for the period attributable to:
Equity holders of the parent 0.1 0.2 -1.2 -1.2 -4.3
Non-controlling interest 0.0 0.0 0.0 0.0 0.0
0.1 0.2 -1.2 -1.2 -4.3
Comprehensive income attributable to:
Equity holders of the parent 0.1 0.2 -1.5 -1.2 -4.6
Non-controlling interest 0.0 0.0 0.0 0.0 0.0
0.1 0.2 -1.5 -1.2 -4.6
Earnings/share (EPS) calculated on the
profit attributable to equity holders
of the parent, EUR
Basic 0.03 0.04 -0.26 -0.25 -0.90
Diluted 0.03 0.04 -0.26 -0.25 -0.90
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 30.9.2013 30.9.2012 31.12.2012
unaudited
MEUR
Assets
Non-current assets
Property, plant and equipment 14.0 17.0 14.6
Goodwill 0.1 0.1 0.1
Other intangible assets 0.5 0.8 0.6
Investments in associated companies 0.3 0.2 0.3
Available-for-sale financial assets 0.1 0.1 0.1
Receivables 0.3 0.3 0.3
Deferred tax assets 1.6 1.4 1.1
16.7 19.9 17.0
Current assets
Inventories 8.4 7.2 6.5
Trade and other receivables 6.4 7.2 5.9
Cash and cash equivalents 4.3 2.9 4.8
19.0 17.4 17.2
Total assets 35.7 37.3 34.2
Equity and liabilities 30.9.2013 30.9.2012 31.12.2012
Equity attributable to equity holders
of the parent company
Share capital 9.9 9.9 9.9
Share premium account 0.5 0.5 0.5
Fund for invested unrestricted equity 6.4 6.8 6.8
Own shares -1.4 -1.4 -1.4
Translation differences -0.0 0.5 0.2
Retained earnings -4.4 0.0 -3.2
11.1 16.3 12.9
Non-controlling interests 0.2 0.2 0.2
Total equity 11.3 16.5 13.1
Non-current liabilities
Deferred tax liabilities 0.1 0.0 0.0
Provisions 0.5 0.3 0.5
Financial liabilities 6.3 5.1 3.9
Other liabilities 0.0 0.0 0.0
6.9 5.4 4.4
Current liabilities
Trade and other payables 15.2 13.8 12.6
Current tax liabilities 0.2 0.1 0.0
Provisions 0.2 0.2 1.6
Current financial liabilities 1.9 1.3 2.4
17.5 15.4 16.7
Total liabilities 24.4 20.8 21.1
Total equity and liabilities 35.7 37.3 34.2
STATEMENT OF CHANGES IN EQUITY
abridged
unaudited
EUR thousand Equity attributable to equity holders of
the parent
a) b) c) d) e) f) g) Yht. h) Total
equity
Total equity 9898 520 5316 1896 462 -1382 1151 17859 242 18101
1.1.2012
Profit/loss for -1179 -1179 -4 -1183
the period
Translation -3 -3 -3
difference
Repayment of -384 -384 -384
capital
Purchase of 0 -35 -35
non-controlling
interests
Reclassification -5316 5316 0 0
Total equity 9898 520 0 6828 459 -1382 -28 16293 202 16495
30.9.2012
a) b) c) d) e) f) g) Yht. h) Total
equity
Total equity 9898 520 0 6828 224 -1382 -3178 12909 209 13117
1.1.2013
Profit/loss for -1230 -1230 1 -1229
the period
Translation -238 -238 -238
difference
Repayment of -384 -384 -384
capital
Management 10 10 10
incentive plan
Total equity 9898 520 0 6444 -14 -1382 -4400 11066 212 11277
30.9.2013
a) Share capital
b) Share premium account
c) Reserve fund
d) Fund for invested unrestricted equity
e) Translation difference
f) Own shares
g) Retained earnings
h) Non-controlling interests
CONSOLIDATED STATEMENT OF CASH FLOWS 1.1.- 1.1.- 1.1.-
abridged 30.9.2013 30.9.2012 31.12.2012
unaudited
MEUR
Cash flow from operating activities -0.8 3.6 5.5
Cash flow from investing activities, net -1.2 -0.3 -0.1
Total cash flows from financing activities: 1.5 -2.9 -3.1
Repayment of capital -0.4 -0.4 -0.4
Proceeds from borrowings 4.4 2.1 2.1
Repayment of borrowings -2.3 -4.5 -4.6
Other financial items -0.1 -0.2 -0.2
Change in cash and cash equivalents -0.5 0.4 2.2
Cash and cash equivalents at the beginning of 4.8 2.6 2.6
period
Cash and cash equivalents at the close of 4.3 2.9 4.8
period
NOTES TO THE REPORT
Accounting principles
This interim report release has been drafted in line with IFRS recognition and
valuation principles. However, not all of the requirements of IAS 34 have been
complied with in its drafting. The interim report should be read together with
the 2012 financial statements. The new revised standards or interpretations
effective as of 1 January 2013 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 owned by the senior management of Honkarakenne
Oyj and was established in 2010, 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
Unaudited Property, plant and
equipment
MEUR
Cost 1.1.2013 63.9
Translation differences (+/-) -0.0
Increase 1.2
Disposals -1.6
Reclassifications -0.0
Cost 30.9.2013 63.5
Accumulated depreciation 1.1.2013 -49.4
Translation differences (+/-) 0.0
Accumulated depreciation of disposals and 1.5
reclassifications
Depreciation for the period -1.7
Accumulated depreciation 30.9.2013 -49.6
Carrying amount 1.1.2013 14.6
Carrying amount 30.9.2013 14.0
Own shares
Honkarakenne Oyj 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
7.05 % of the company's capital stock and 3.35 % of all votes.
Contingent liabilities
Unaudited 30.9.2013 30.9.2012 31.12.2012
MEUR
For own loans
- Mortgages 25.7 25.7 25.7
- Other quarantees 2.0 1.7 3.4
For others
- Guarantees 0.0 0.2 0.0
Leasing liabilities 0.3 0.3 0.2
Derivative contracts 0.3 0.4 0.3
Nominal values of forward exchange contracts 0.7 1.0 2.9
KEY INDICATORS
1-9 1-9 1-12
Unaudited 2013 2012 2012
Earnings/share (EPS) euro -0.26 -0.25 -0.90
Return on equity % -10 -7 -28
Equity ratio % 42 53 47
Shareholders equity/share euro 2.30 3.39 2.69
Net financial liabilities MEUR 3.9 3.5 1.5
Gearing % 35 21 11
Gross investments MEUR 1.3 0.9 0.9
% of net sales 4 3 2
Order book MEUR 21.4 19.0 15.9
Average number of personnel Staff 113 122 123
Workers 108 136 134
Total 221 258 257
Personnel in person-years, average Staff 103 117 117
Workers 78 85 81
Total 181 202 198
Adjusted number of shares ('000) At period-end 4805 4805 4805
Average during period 4805 4805 4805
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 Financial liabilities - cash and cash equivalents
liabilities
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
© 2024 Nasdaq, Inc. All Rights Reserved |