2011-08-05 08:00:00 CEST
2011-08-05 08:00:06 CEST
REGULATED INFORMATION
Nurminen Logistics Oyj - Interim report (Q1 and Q3)
NURMINEN LOGISTICS PLC'S INTERIM REPORT 1 JANUARY - 30 JUNE 2011
- Net sales recovered clearly, operating loss of the review period decreased compared to 2010 Nurminen Logistics Plc Interim report 5 August 2011 at 9.00 a.m. REVIEW PERIOD IN BRIEF Review period 1 January - 30 June 2011 - Net sales were EUR 36.3 million (2010: EUR 32.4 million). - Reported operating result was EUR -0.4 million (EUR -0.6 million). - Operating margin was -1.2% (-1.8%). - Operating result excluding non-recurring items was EUR -0.7 million (EUR -1.5 million). - EBT was EUR -1.1 million (EUR -0.1 million). - Net result was EUR -1.4 million (EUR -0.7 million). - Earnings per share: -0.15 Euros (-0.09 Euros). Second quarter 1 April - 30 June 2011 - Net sales were EUR 18.6 million (2010: EUR 17.0 million). - Reported operating result was EUR 0.2 million (EUR -0.4 million). - Operating margin was 1.0% (-2.2%). - Operating result excluding non-recurring items was EUR -0.1 million (EUR -0.8 million). - EBT was EUR -0.1 million (EUR -0.4 million). - Net result was EUR -0.3 million (EUR -0.7 million). - Earnings per share: -0.05 Euros (-0.07 Euros). MARKET SITUATION 1 JANUARY - 30 JUNE 2011 Finnish foreign trade and Nurminen Logistics' most important market, trade between Finland and the CIS countries, developed favourably. However, the competitive situation was challenging especially due to increase of the Russian railway tariffs. The increase had a negative effect on price competitiveness of railway transports. In April and May the strike of the Finnish paper industry's office workers affected company's demand and transported volumes negatively. Despite the above-mentioned facts both demand and volumes improved in railway transports compared to 2010 except for the drop in April. The special and heavy transportation market did not develop as positively as expected although the demand situation was better than in the comparable period in 2010. The harbour logistics market remained challenging although there was slight increase in demand inter alia in transit traffic towards the end of the review period. Demand of the forest industry improved compared to 2010. Also the demand of mechanical engineering industry improved compared to 2010, but the price competition remained intense especially in project transportations. NET SALES AND FINANCIAL PERFORMANCE 1 JANUARY- 30 JUNE 2011 The net sales for the review period amounted to EUR 36.3 (2010: 32.4) million. Compared to the corresponding period last year the increase of the net sales was 12.2%. Reported operating result was EUR -440 (-582) thousand. The increase was 24.5%. Operating result includes non-recurring items of EUR 248 (+868) thousand. Therefore, comparable operating result was EUR -688 thousand. Compared to the corresponding period last year the increase was 52.6%. The non-recurring item in 2010 was a result of the company's decision to give up its purchase option and first refusal right to the logistics centre in Vuosaari as published on 18 June 2009. The company has a long-term lease agreement in Vuosaari. The non-recurring item in the review period was a result of a partial payment of a receivable written down in the financial statements 2010. The growth of net sales was based on the recovery of demand especially in the rail transport exports from Finland to CIS countries. Also the demand of mechanical engineering industry's clientele developed positively in all market segments. In the company's harbour logistics services the development was varying. In Kotka and Hamina the transit volumes to CIS countries are still on a low level. In Vuosaari the volumes started to grow during the review period as a result of new customer agreements. Operating result remained negative. This is mainly due to the increase of the losses of the Vuosaari logistics centre. The increase of the losses was due to the changes in the customer structure and increase in lease costs of the logistics centre. The lease of the Vuosaari logistics centre increased in the review period according to the lease agreement by EUR 0.2 million compared to the corresponding period in 2010. In the review period the operating loss of the Vuosaari logistics centre was EUR 1.7 (1.5) million. Also the intense price competition of special and heavy transport affected profitability negatively. The operating profit of the company's operations in the Baltic countries weakened as expected by EUR 0.4 million compared to the strong first half of 2010. The personnel cost savings based on the results of the co-determination negotiations held in 2010 were in the review period EUR 0.6 million, in line with the target. The appreciation of the Russian rouble during the review period increased the company's financial result by EUR 0.1 million. NET SALES AND FINANCIAL PERFORMANCE OF THE SECOND QUARTER The 2011 second quarter net sales amounted to EUR 18.6 (2010: 16.9) million. Compared to the corresponding period last year the increase of the net sales was 9.7%. Reported operating result was EUR 195 (-382) thousand. The operating result increased by 150.9%. Operating result includes non-recurring profits EUR 248 (2010: 434) thousand. Therefore comparative operating result increased 93.5% compared to the corresponding period last year. The non-recurring item in 2010 was a result of the company's decision to give up its purchase option and first refusal right to the logistics centre in Vuosaari as published on 18 June 2009. The company has a long-term lease agreement in Vuosaari. The non-recurring item in the second quarter 2011 was a result of a partial payment of a receivable written down in the financial statements 2010. Net sales continued to grow. Demand situation recovered slightly in railway transportations, terminal services and forwarding services although demand growth was hindered by the paper industry's office workers' strike in April and May. Demand for special and project transports services recovered during the second quarter. Profitability continued to be burdened by weak volume situation, price competition that remained tough and the start-up of new customers in Vuosaari logistics centre. OUTLOOK The company's outlook published in the financial statement release on 25 February 2011 is unchanged. The net sales of the company are expected to increase by approximately 10% in 2011 compared to 2010. The company's operating result is expected to be slightly better than in 2010. The company's unchanged long-term goal is to increase its net sales annually by approximately 20% on average, including acquisitions, and to reach an operating profit level of over 7%. The general economic situation is assessed to delay achieving of the growth objectives in the short term. The company is actively following the structural changes in the logistics market as well as acquisition opportunities. SHORT-TERM RISKS AND UNCERTAINTIES Increased uncertainty in the world economy might result in lower industrial production volumes. That would have a negative effect on company's net sales and result development. Over-capacity of Finnish ports maintains tough price competition. The company operates in Vuosaari, Kotka and Hamina harbours and therefore the volume development of those harbours is relevant to the company. Volume development is effected, among other things, by development of the transit trade that decreased during the recession. Its outlook is unclear at the moment. The railway tariff changes of different countries might affect the price competitiveness of rail transports significantly. In addition, price competition situation might burden the company's profitability also in the future. Weaker than expected volume growth of foreign trade would burden the development of the company's net sales and profitability. FINANCIAL POSITION AND BALANCE SHEET Company's cash flow from operations was EUR 3,766 thousand. Cash flow from investments was EUR -231 thousand. Cash flow from financing activities amounted to EUR -3,585 thousand. At the end of the review period, cash and cash equivalents amounted to EUR 2,514 thousand. Liquidity improved during the second quarter as a result of new financing agreements and is good. Group's interest bearing debt was EUR 29,5 million and correspondingly the net interest bearing debt was EUR 27.0 million. Balance sheet totaled EUR 73.7 million and equity ratio was 39.0%. CHANGES IN THE TOP MANAGEMENT The Board of Directors of Nurminen Logistics Plc appointed on 6 April 2011 Mr Topi Saarenhovi, M.Sc. (Tech.), the new President and CEO of the company. Saarenhovi (born 1967) started in his new position on 1 May 2011. Mr Antti Sallila, who was the Acting CEO of Nurminen Logistics Plc during 25 November 2010 - 30 April 2011 continued his duties as the CFO of the company. The changes in the top management were published in stock exchange release on 6 April 2011. CAPITAL EXPENDITURE The Group's gross capital expenditure for review period amounted to EUR 343 (263) thousand, accounting for 0.9% of net sales. Depreciation totaled EUR 2.1 (2.3) million, or 5.9% of net sales. GROUP STRUCTURE The Group comprises the parent company, Nurminen Logistics Plc, as well as the following subsidiaries and associated companies, owned directly or indirectly by the parent (ownership, %): RW Logistics Oy (100 %), JN Ferrovia Oy (100 %), OOO John Nurminen, St. Petersburg (100 %), OOO John Nurminen, Moscow (100 %), Nurminen Maritime Latvia SIA (51 %), Pelkolan Terminaali Oy (20 %), ZAO Irtrans (100 %), OOO Huolintakeskus (100 %), OOO John Nurminen Terminal (100 %), ZAO Terminal Rubesh (100 %), Nurminen Logistics LLC (100 %), UAB Nurminen Maritime (51 %), Nurminen Maritime Eesti AS (51 %), CMA CGM Latvia SIA (23 %), CMA CGM Estonia Oü (23 %), Team Lines Latvia SIA (23 %) and Team Lines Estonia Oü (20,3 %). PERSONNEL At the end of the review period the Group staff was 342 (339 on 31 December 2010). The number of personnel working abroad was 71. Management and administrative staff numbered to 26. SHARE-BASED INCENTIVE PLAN FOR THE GROUP PERSONNEL The Board of Directors of Nurminen Logistics Plc has approved on 7 March 2011 a share-based incentive plan for the Group key personnel. The plan was described in stock exchange release published on 7 March 2011. SHARES AND SHAREHOLDERS The trading volume of Nurminen Logistics Plc's shares was 334,984 in 1 January - 30 June 2011. This represented 2.60% of the total number of shares. The value of the turnover was EUR 887,299. The lowest price for the period was EUR 2.28 per share and the highest EUR 3.00 per share. The closing price for the period was EUR 2.30 per share and the market value of the entire share capital EUR 29,620,499. At the end of the review period Nurminen Logistics Plc had 474 shareholders. The company owns 705 of its own shares, which represent 0.005% of the votes in the company. DECISIONS OF THE ANNUAL GENERAL MEETING The decisions of the Nurminen Logistics Plc's Annual General Meeting of Shareholders were published in stock exchange release on 6 April 2011. DIVIDEND POLICY Company's Board has on 14 May 2008 determined company's dividend policy, according to which Nurminen Logistics Plc aims to, in case company's financial policy so allows, annually distribute as dividends approximately one third of its net profit. AUTHORISATIONS GIVEN TO THE BOARD Authorising the Board of Directors to decide on the repurchase of the company's own shares Annual General Meeting authorised the Board to decide on the repurchasing a maximum of 30,000 of the company's shares. The authorisation will be used for the paying of remuneration of the Board members. The own shares may be repurchased pursuant to the authorisation only by using unrestricted equity. The price payable for the shares shall be based on the price of the company's shares in public trading. The own shares may be repurchased in deviation from the proportional shareholdings of the shareholders (directed repurchase). The authorisation includes the right whereby the Board is authorised to decide on all other matters related to the acquisition of own shares. The authorisation remains in force until 30 April 2012. Authorising the Board of Directors to decide on the issuance of shares as well as the issuance of options and other special rights entitling to shares Annual General Meeting authorised the Board to decide on issuance of shares and/or special rights entitling to shares pursuant to chapter 10 section 1 of the Finnish Companies Act. Based on the aforesaid authorisation the Board is entitled to release or assign, either by one or several resolutions, shares and/or special rights up to a maximum equivalent of 20,000,000 new shares so that aforesaid shares and/or special rights can be used, e.g., for the financing of company and business acquisitions corporate and business trading or for other business arrangements and investments, for the expansion of owner structure, paying of remuneration of the Board members and/or for the creating incentives for, or encouraging commitment in, personnel. The authorisation gives the Board the right to decide on share issue with or without payment. The authorisation for deciding on a share issue without payment also includes the right to decide on the issue for the company itself, so that the number of shares granted to the company is no more than one tenth of all shares of the company. The authorisation includes the right whereby the Board is entitled to decide of all other issues of shares and special rights. Furthermore, the Board is entitled to decide on share issues, option rights and other special rights in every way similarly as the Annual General Meeting could decide on these. The authorisation also includes right to decide on directed issues of shares and/or special rights. The authorisation remains in force until 30 April 2012. Based on this authorisation the company issued 26,250 new shares on 13 July 2011. The new shares were used for reward payments from the earning period 2010 of the Nurminen Logistics Group key personnel Share-Based Incentive Plan 2008-2010 according to achievement of targets established for the earnings criteria approved by the Board of Directors. OTHER EVENTS DURING THE REVIEW PERIOD Closing of terminal in Hakkila In order to adjust terminal capacity and cost structure the company has decided to close its terminal in Hakkila by giving notice to terminate the lease agreement and moving its operations to Vuosaari logistics centre. Operations in Hakkila will end by the end of 2011. By this closure the company targets EUR 0.3 million annual profit increase as from 2012. Share-Based Incentive Plan 2008-2010; directed share issue without consideration The Board of Directors of Nurminen Logistics Plc decided on 20 June 2011 on a directed share issue without consideration by authorisation of the company's Annual General Meeting of Shareholders held on 6 April 2011. The new shares issued in the share issue were used for reward payments from the earning period 2010 of the Nurminen Logistics Group key personnel Share-Based Incentive Plan 2008-2010 according to achievement of targets established for the earnings criteria approved by the Board of Directors. In the share issue, a total of 26,250 new shares in Nurminen Logistics were issued to the key personnel entitled to rewards on the basis of earning period 2010 of the Nurminen Logistics Group key personnel Share-Based Incentive Plan 2008-2010 according to the terms and conditions of the Share-Based Incentive Plan 2008-2010 and the decision by the Board of Directors. The number of the company's shares is 12,904,728 after the Trade Register entry of the new shares. The shares issued in the share issue represent 0.2% of the number of shares and votes after the share issue. EVENTS AFTER THE REVIEW PERIOD New shares entered into the trade register The Board of Directors of Nurminen Logistics Plc decided on 20 June 2011 on a directed share issue without consideration by authorisation of the company's Annual General Meeting of Shareholders held on 6 April 2011. In the share issue, a total of 26,250 new shares in Nurminen Logistics were issued to the key personnel entitled to rewards on the basis of earning period 2010 of the Nurminen Logistics Group key personnel Share-Based Incentive Plan 2008-2010. The new shares were entered into the Trade Register on 13 July 2011. The shareholder rights commenced after the new shares were entered into the Trade Register. After the Trade Register entry of the new shares, the number of the company's all shares is 12,904,728 shares. The shares entered into the Trade Register were applied for public trading on NASDAQ OMX Helsinki Ltd on 14 July 2011. Disclaimer Certain statements in this bulletin are forward-looking and are based on the management's current views. Due to their nature, they involve risks and uncertainties and are susceptible to changes in the general economic or industry conditions. NURMINEN LOGISTICS PLC Board of Directors For more information, please contact Topi Saarenhovi, President and CEO (tel. +358 10 545 2431) DISTRIBUTION NASDAQ OMX Helsinki Major media www.nurminenlogistics.com Nurminen Logistics provides high-quality logistics services, such as railway transports, terminal services, forwarding and special and heavy transports. The company has collected logistics know-how from three centuries, starting in 1886. Nurminen Logistics' main market areas are Finland, the Baltic Sea region, Russia and other Eastern European countries. The company's share is listed on NASDAQ OMX Helsinki. TABLES CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME 1-6/2011 1-6/2010 1-12/2010 EUR 1,000 NET SALES 36 339 32 384 69 682 Other operating income 290 875 1 492 Materials and services -18 267 -14 909 -33 229 Employee benefit expenses -7 240 -7 475 -15 433 Depreciation and impairment -2 132 -2 271 -4 466 Other operating costs -9 430 -9 186 -18 664 OPERATING RESULT -440 -582 -618 Financial income 138 1 294 1 865 Financial expenses -928 -747 -2 679 Share of profit in associates 149 104 359 RESULT BEFORE TAX -1 081 69 -1 072 Income taxes -315 -754 -957 PROFIT / LOSS FOR THE PERIOD -1 396 -685 -2 029 Other comprehensive income: Translation differences 160 2 394 788 Other comprehensive income for the period after 160 2 394 788 tax TOTAL COMPREHENSIVE INCOME FOR THE PERIOD -1 236 1 709 -1 241 Net result attributable To equity holders of the parent -1 870 -1 117 -2 884 To non-controlling interest 474 432 855 Total comprehensive income attributable to To equity holders of the parent -1 710 -2 141 -2 096 To non-controlling interest 474 432 855 EPS undiluted -0,15 -0,09 -0,22 EPS diluted -0,15 -0,09 -0,22 CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME 4-6/2011 4-6/2010 Change EUR 1,000 NET SALES 18 648 16 996 1 652 Other operating income 249 438 -189 Materials and services -9 256 -8 113 -1 143 Employee benefit expenses -3 777 -3 842 65 Depreciation and impairment -1 055 -1 163 108 Other operating costs -4 614 -4 698 84 OPERATING RESULT 195 -382 577 Financial income 82 525 -443 Financial expenses -485 -533 48 Share of profit in associates 68 40 28 RESULT BEFORE TAX -140 -350 210 Income taxes -120 -351 231 PROFIT / LOSS FOR THE PERIOD -260 -701 441 Other comprehensive income: 0 0 0 Translation differences -129 750 -879 Other comprehensive income for the period after tax -129 750 -879 TOTAL COMPREHENSIVE INCOME FOR THE PERIOD -389 49 -438 Net result attributable To equity holders of the parent -661 -946 285 To non-controlling interest 401 245 156 Total comprehensive income attributable to To equity holders of the parent -790 -196 -594 To non-controlling interest 401 245 156 EPS undiluted -0,05 -0,07 0,02 EPS diluted -0,05 -0,07 0,02 CONSOLIDATED BALANCE SHEET 30.6.2011 30.6.2010 31.12.2010 EUR 1,000 ASSETS Non-current assets Property, plant, equipment 43 141 48 221 44 617 Goodwill 9 516 9 516 9 516 Intangible assets 734 855 818 Investments in associates 349 418 651 Other long-term receivables 714 769 714 Deferred tax asset 863 822 760 NON-CURRENT ASSETS 55 316 60 601 57 075 Current assets Trade receivables and other receivables 15 881 19 706 14 507 Cash and bank 2 514 1 533 2 563 CURRENT ASSETS 18 396 21 239 17 070 ASSETS TOTAL 73 712 81 840 74 145 EQUITY AND LIABILITIES Share capital 4 215 4 215 4 215 Other reserves 18 451 19 952 18 291 Retained earnings 5 480 9 424 7 373 Non-controlling interest 610 598 993 SHAREHOLDERS' EQUITY 28 756 34 189 30 872 Non-current liabilities Deferred tax liability 457 370 414 Interest-free liabilities 666 954 733 Interest-bearing liabilities 20 313 26 337 23 317 NON-CURRENT LIABILITIES 21 437 27 661 24 464 Current liabilities Interest-bearing liabilities 9 220 8 218 9 227 Trade payables and other liabilities 14 299 11 772 9 582 CURRENT LIABILITIES 23 519 19 990 18 809 TOTAL LIABILITIES 44 956 47 651 43 273 TOTAL EQUITY AND LIABILITIES 73 712 81 840 74 145 CONDENSED CONSOLIDATED CASH FLOW STATEMENT 1-6/2011 1-6/2010 1-12/2010 CASH FLOW FROM OPERATING ACTIVITIES Profit/Loss for the period -1 395 -685 -2029 Adjustments to reconcile profit -32 4 18 Depreciation and amortisation 2 132 2 271 4466 Unrealised foreign exchange wins and losses -70 -1 587 -1069 Other adjustments -149 1 722 2259 Paid and received interest 860 -1 064 -1809 Taxes paid 315 -587 -682 Changes in working capital 2 106 -986 1734 Cash flow from operating activities 3 766 -912 2888 CASH FLOW FROM INVESTING ACTIVITIES Proceeds from sales of other investments 0 0 4 Proceeds from sales of fixed assets 113 64 80 Investments in tangible and intangible assets -343 -263 -849 Cash flow from investing activities -231 -199 -765 CASH FLOW FROM FINANCING ACTIVITIES Acquisition of own shares 0 0 -56 Changes in liabilities -2 728 1 310 -860 Dividends paid -857 -904 -923 Cash flow from financing activities -3 585 406 -1839 CHANGE IN CASH AND CASH EQUIVALENTS -49 -705 325 Cash and cash equivalents at beginning of period 2 563 2 238 2238 Cash and cash equivalents at end of period 2 514 1 533 2563 A= Share capital B= Share premium account C= Reserve fund D= Unrestricted equity reserve E= Translation differences F= Retained earnings G= Non-controlling interest H= Total STATEMENT OF CHANGES IN EQUITY A B C D E F G H 1-6/10 EUR 1,000 Shareholders' equity at 4215 89 2374 19238 -4140 9737 1072 32585 beginning Other changes 0 -2 0 -1 0 804 -2 799 Total comprehensive income for 0 0 0 0 2394 -1117 432 1709 the period Dividends 0 0 0 0 0 0 -904 -904 Shareholders' equity 30.6.2010 4215 87 2374 19237 -1746 9424 598 34189 STATEMENT OF CHANGES IN EQUITY A B C D E F G H 1-6/11 EUR 1,000 Shareholders' equity at 4215 86 2378 19178 -3352 7373 993 30872 beginning Other changes 0 0 0 0 0 -24 0 -24 Total comprehensive income for 0 0 0 0 160 -1869 474 -1236 the period Dividends 0 0 0 0 0 0 -857 -857 Shareholders' equity 30.6.2011 4215 86 2378 19178 -3192 5480 610 28756 SEGMENT INFORMATION The figures of the operating segment are equal to the Group's figures. RELATED PARTY TRANSACTIONS The related parties comprise the members of the Board of Directors and Executive Board of Nurminen Logistics and companies in which these members have control. Related parties are also deemed to include shareholders with direct or indirect control or substantial influence. Related party transactions 1-6/2011 EUR 1,000 Sales 13 Expenses 427 Financial expenses 60 Current liabilities 2 543 Non-current liabilities 1 271 KEY FIGURES KEY FIGURES 1-6/2011 1-6/2010 1-12/2010 Gross capital expenditure, EUR 1,000 343 263 849 Personnel 342 342 344 Operating margin % -1,2 % -1,8 % -0,9 % Share price development Share price at beginning of period 2,89 3,35 3,35 Share price at end of period 2,30 3,28 2,89 Highest for the period 3,00 3,73 3,73 Lowest for the period 2,28 3,20 2,81 Eguity/share EUR 2,23 2,66 2,40 Earnings/share (EPS) EUR -0,15 -0,09 -0,22 Equity ratio % 39,01 41,78 41,64 OTHER LIABILITIES AND COMMITMENTS Contingent liabilities, 1000 eur 30.6.2011 30.6.2010 31.12.2010 Mortgages given 3 000 3 000 3 000 Other contingent liabilities 10 780 10 780 10 780 Rent liabilities 81 070 76 125 84 470 Accounting policies The interim financial information has been prepared in accordance with IAS 34 'Interim Financial Reporting'. The IFRS recognition and measurement principles as described in the annual financial statements for 2010 have also been applied in the preparation of the interim financial information, with the changes mentioned below. Other adopted new and amended IFRS-standards and interpretation have not had significant impact on reported figures. The Group has applied e.g. the following revised and amended standards as of 1 January 2011: Amendment to IAS 32 Financial Instruments: Presentation - Classification of rights issues. The amendment relates to accounting (classification) for share, option or rights issues denominated in a foreign currency. IFRIC 19 Extinguishing Financial Liabilities with Equity Instruments. The interpretation clarifies accounting treatment in cases where a company renegotiates a financial liability, and as a result issues equity instruments to the creditor to extinguish all or part of the financial liability. Revised IAS 24 Related Party Disclosures. The definition of a related party is clarified and certain disclosure requirements for government related entities are changed. All figures have been rounded and consequently the sum of individual figures can deviate from the presented sum figure. Key figures have been calculated using exact figures. This Interim Report is unaudited. Calculation of Key Figures Equity ratio (%) = Total equity ______________________________________ x 100 Total assets - advances received Earnings per share (EUR) = Profit for the period attributable to equity holders of the parent company _________________________________________________________ x 100 Number of shares (average during the period) Equity per share (EUR) = Equity ________________________________________ x 100 Number of shares at the end of the period
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