2016-07-21 07:00:02 CEST
2016-07-21 07:00:02 CEST
REGULATED INFORMATION
Atria Oyj - Half Year financial report
Atria Plc Interim Report 1 January – 30 June 2016
Atria invests in growth
Seinäjoki, Finland, 2016-07-21 07:00 CEST (GLOBE NEWSWIRE) -- Atria Plc,
Interim Report, 21 July 2016 at 8.00 am
ATRIA PLC INTERIM REPORT 1 JANUARY – 30 JUNE 2016
Atria invests in growth
April–June 2016
- Consolidated net sales totalled EUR 341.3 million (EUR 337.5 million).
- Consolidated EBIT was EUR 6.1 million (EUR 8.4 million), or 1.8% (2.5%) of
net sales.
- Lagerberg i Norjeby AB's business operations were transferred to Atria as of
the beginning of May. Atria's annual net sales are expected to grow by about
EUR 30 million. In June, Atria decided to invest EUR 14 million in Lagerbergs’
chicken production in Sweden.
- Atria will acquire a majority stake in Well-Beef Kaunismaa Ltd subject to the
approval of the Finnish Competition and Consumer Authority. Atria's annual net
sales are expected to grow by about EUR 40 million.
- Atria Finland's new pig cutting plant has entered the start-up phase.
- Atria sold a pig farm in Estonia and estates that it no longer needed in
Estonia and Sweden.
January–June 2016
- Consolidated net sales totalled EUR 655.8 million (EUR 652.1 million).
- Consolidated EBIT was EUR 7.8 million (EUR 9.1 million), which is 1.2 per
cent (1.4%) of net sales.
- EBIT growth was slowed by decreased sales prices, the costs of starting up
the pig cutting plant and the costs incurred in taking over new businesses.
Q2 Q2 H1 H1
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EUR million 2016 2015 2016 2015 2015
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Net sales
Atria Finland 233.9 233.7 458.6 445.9 929.0
Atria Scandinavia 88.8 80.3 164.5 165.4 330.5
Atria Russia 17.6 21.5 31.2 37.3 75.1
Atria Baltic 9.2 8.9 16.9 16.5 32.9
Eliminations -8.3 -6.8 -15.5 -13.1 -27.4
Total net sales 341.3 337.5 655.8 652.1 1,340.2
EBIT
Atria Finland 3.0 4.7 4.7 6.6 29.8
Atria Scandinavia 3.5 2.5 4.2 4.4 12.8
Atria Russia 0.1 1.9 -0.6 -0.3 -0.2
Atria Baltic -0.3 0.2 -0.5 0.1 -9.0
Unallocated -0.2 -0.9 0.0 -1.6 -4.4
EBIT, total 6.1 8.4 7.8 9.1 28.9
EBIT, % 1.8 % 2.5 % 1.2 % 1.4 % 2.2 %
Profit before taxes 4.8 6.0 4.5 4.4 20.1
Earnings per share, EUR 0.13 0.18 0.10 0.11 0.49
EBIT includes items affecting comparability:
Goodwill impairment - - - - -9.1
Pig farms sale -1.0 1.9 -1.0 1.9 1.9
Sale of the real estate company 1.4 - 1.4 - -
Adjusted EBIT 5.7 6.5 7.4 7.2 36.1
Juha Gröhn, CEO
"Fierce price competition has continued in Atria's home markets of Finland,
Sweden, Estonia, Russia and Denmark. The product groups currently facing the
toughest price competition are meat products and pork in Finland and Estonia,
as well as some meat-product segments in Scandinavia. During the spring,
raw-material markets turned a corner as the price of pork began to rise in
Europe. This change will increase the pressure for price rises among ready-made
products.
During the first half of the year, Atria's Healthy Growth strategy was
implemented systematically. Atria is looking for growth, both organic growth
and expansion through acquisitions.
Atria acquired a foothold in the expanding Swedish poultry market by purchasing
Lagerbergs. The transaction was complemented by the initiation of a EUR 14
million investment programme in the newly-acquired company. The aim is to make
Lagerbergs a strong player on Nordic poultry markets by joining forces with
Atria Finland's poultry operations.
In Finland, Atria will purchase a majority stake in Well-Beef Kaunismaa Ltd, a
company that primarily sells raw meat products and beef on Food Service
markets. Conclusion of the deal is subject to the approval of the competition
authorities.
Atria's most significant investment is the modernisation of the Nurmo pig
cutting plant. Cutting will become more efficient and annual costs will
decrease by approximately EUR 8 million in comparison with previous figures.
Commissioning of the plant began in May. Commissioning of the plant is
currently increasing cutting costs and additional costs will decrease as the
commissioning gathers pace.
Development of the Sibylla concept is continuing at pace, particularly in
Russia. Sales are showing good development and there are currently more than
2,500 sales outlets in Russia.
During the first half of the year, Atria concluded three separate transactions
to sell premises and businesses that it no longer needed. The Linnamäe pig farm
and Vastse-Kuuste production plant in Estonia found new owners, as did the
logistics unit in Gothenburg."
April–June 2016
Atria Group’s net sales for April–June totalled EUR 341.3 million (EUR 337.5
million). EBIT amounted to EUR 6.1 million (EUR 8.4 million). Adjusted EBIT was
EUR 5.7 million (EUR 6.5 million). Sales volumes increased during the period
under review. The decline in sales prices due to price competition has slowed
down the growth in net sales and EBIT. Sales in Finland were weighted towards
exports, wholesale and industrial sales, which weakened EBIT.
The Swedish Competition Authority and Consumer Agency unconditionally approved
Atria's acquisition of the entire share capital of Lagerberg i Norjeby AB
(Lagerbergs), a Swedish poultry company. The agreement between Atria and
Lagerbergs was confirmed at the end of April and the business operations were
transferred to Atria as of the start of May. The purchase price was
approximately EUR 18 million, and it was paid in cash. Atria's annual net sales
are expected to grow by about EUR 30 million. The transaction expands Atria's
business into the Swedish poultry processing market.
In June, Atria’s Board of Directors approved a long-term investment programme
worth EUR 14 million for the development of Lagerbergs’ operations. The
investments will be devoted to improving the entire production chain, from
chicken rearing and industrial production to strengthening Lagerbergs’ brand.
The investments will take place in the period from 2016 to 2018.
Negotiations with the personnel concerning the investment project in Atria
Finland's pig cutting plant located in Nurmo were concluded. The cutting
plant’s operations will be reorganised and working methods revised. As a result
of these arrangements, staffing will be reduced by 80 person-years by the end
of 2016. The reduction in personnel will be implemented by means of natural
attrition, internal transfers and pension arrangements. In addition, the plant
will no longer subcontract cutting work. The value of the investment is
approximately EUR 36 million, and it is expected to generate annual cost
savings of some EUR 8 million in the plant’s operations. These savings will be
realised in full as of the beginning of 2018. The first phase of the pig
cutting plant will be commissioned this year.
Atria Finland will purchase 70 per cent of Well-Beef Kaunismaa Ltd's share
capital. Well-Beef's business focuses on beef processing and wholesale
business. Atria's annual net sales are expected to increase by approximately
EUR 40 million. The transaction requires the approval of the Finnish
Competition and Consumer Authority. Efforts will be made to conclude the
transaction during the third quarter of this year.
Atria sold the Linnamäe pig farm located in Northern Estonia. The sale of the
Linnamäe pig farm gave rise to a sales loss of approximately EUR 1 million. The
pig farm was transferred into new ownership on 29 April 2016.
Atria centralised its industrial operations in Estonia at the Valga factory.
Production of meat products was transferred from the Vastse-Kuuste factory to
Valga and the real estate was sold. The sale had no impact on the company’s
results. Production rearrangements were concluded by the end of the second
quarter. The measures are expected to generate annual savings of approximately
EUR 0.5 million.
Atria centralised its logistics operations in Sweden by moving them from
Gothenburg to the Malmö plant. The logistics centre in Gothenburg was sold for
a profit of EUR 1.4 million.
Atria Finland's net sales for April–June totalled EUR 233.9 million (EUR 233.7
million). The proportion of exports, wholesale and industrial sales of total
sales volume has increased. Sales to retail and Food Service customers
decreased correspondingly, which resulted in decreased market share. Tough
price competition in the retail sector and a weakened sales structure weighed
down EBIT. EBIT amounted to EUR 3.0 million (EUR 4.7 million).
Atria Scandinavia’s net sales for April–June totalled EUR 88.8 million (EUR
80.3 million). EBIT amounted to EUR 3.5 million (EUR 2.5 million). Adjusted
EBIT was EUR 2.1 million (EUR 2.5 million). Net sales increased thanks to good
sales trends in Sweden and the purchase of Lagerbergs.
Atria Russia's net sales for April–June totalled EUR 17.6 million (EUR 21.5
million). In the local currency, net sales grew by 3 per cent. EBIT amounted to
EUR 0.1 million (EUR 1.9 million). Adjusted EBIT was EUR 0.1 million (EUR 0.1
million).
Atria Baltic's net sales for April–June totalled EUR 9.2 million (EUR 8.9
million). EBIT was EUR -0.3 million (EUR 0.2 million). Adjusted EBIT was EUR
0.7 million (EUR 0.2 million). Sales volumes were good, particularly in May and
June. Sales of new minced meat products got off to a promising start.
Cost-efficiency has improved from the previous year.
January–June 2016
Atria Group’s net sales for January–June totalled EUR 655.8 million (EUR 652.1
million). EBIT amounted to EUR 7.8 million (EUR 9.1 million). Adjusted EBIT was
EUR 7.4 million (EUR 7.2 million). EBIT growth was slowed by decreased sales
prices, the costs of starting up the pig cutting plant and the costs incurred
in taking over new businesses.
Atria Finland’s net sales for January–June totalled EUR 458.6 million (EUR
445.9 million), up by EUR 12.8 million year-on-year. Increased sales volumes at
the beginning of the year enabled net sales to grow. Average sales prices have
decreased on home markets in comparison with the equivalent period last year.
EBIT amounted to EUR 4.7 million (EUR 6.6 million).
Atria Scandinavia’s net sales for January–June totalled EUR 164.5 million (EUR
165.4 million). EBIT amounted to EUR 4.2 million (EUR 4.4 million). Adjusted
EBIT was EUR 2.8 million (EUR 4.4 million). In the first half of the year, EBIT
was weighed down by a weak sales structure.
Atria Russia’s net sales for January–June totalled EUR 31.2 million (EUR 37.3
million). In the local currency, net sales grew by 1.3 per cent. EBIT was EUR
-0.6 million (EUR -0.3 million). Adjusted EBIT was EUR -0.6 million (EUR -2.2
million). EBIT improved thanks to efficiency improvement measures and a
revamped product selection.
Atria Baltic’s net sales for January–June totalled EUR 16.9 million (EUR 16.5
million). EBIT was EUR -0.5 million (EUR 0.1 million). Adjusted EBIT was EUR
0.5 million (EUR 0.1 million). Atria's retail sales volumes showed positive
development in the first half of the year. Sales of fresh and marinated meat
showed particularly strong improvement.
Key indicators
EUR million 30.6.16 30.6.15 31.12.15
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Equity/share, EUR 13.95 14.14 14.16
Interest-bearing liabilities 235.9 240.1 199.6
Equity ratio, % 44.8 % 45.1 % 47.4 %
Net gearing, % 58.1 % 58.8 % 48.3 %
Gross investments in fixed assets 42.8 28.8 56.9
Gross investments, % of net sales 6.5 % 4.4 % 4.2 %
Average personnel (FTE) 4,340 4,399 4,271
The principles for calculating key indicators were presented in the 2015 annual
financial statements.
Outlook for the future
Consolidated EBIT was EUR 28.9 million in 2015. In 2016, EBIT is expected to be
better than in 2015. In 2016, net sales are expected to grow.
Disclosure
Atria Plc complies with the disclosure procedure in accordance with standard
5.2b of the Financial Supervisory Authority and publishes its financial
statement release for 1 January to 30 June 2016 as an attachment to this
company announcement. The full release is available on the company’s website at
www.atria.com.
For more information, please contact: Juha Gröhn, CEO, Atria Plc, tel. +358 400
684224.
Invitation to press conference
A press conference will be held in Finnish today, 21 July 2016, at 10:30 am at
Atria Plc’s Helsinki office, Läkkisepäntie 23, Helsinki. The presentation
material will be available on the company’s website (www.atria.com) after the
publication of the financial statements and as an attachment to this company
announcement.
ATRIA PLC
Boad of Directors
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