2014-04-25 13:00:01 CEST
2014-04-25 13:00:10 CEST
REGULATED INFORMATION
Lassila & Tikanoja - Interim report (Q1 and Q3)
Lassila & Tikanoja plc: Interim Report 1 January - 31 March 2014
Helsinki, Finland, 2014-04-25 13:00 CEST (GLOBE NEWSWIRE) --
Lassila & Tikanoja plc: Interim Report 1 January - 31 March 2014
Lassila & Tikanoja plc
Interim Report
25.4.2014 2.00 pm
-- Net sales for the first quarter EUR 159.4 million (EUR 167.7 million)
-- Operating profit EUR 2.1 million (EUR 6.3 million), including EUR 6.4
million of non-recurring impairment related to the insolvency of the
EcoStream Group.
-- Operating profit excluding non-recurring items EUR 7.4 million (EUR 6.8
million)
-- Earnings per share EUR -0.42 (EUR 0.12)
-- In the first quarter, the company divested its Latvian business operations
and recognised a non-recurring capital gain of EUR 1.1 million on the
divestment.
-- Comparable net sales in 2014 are expected to remain at the 2013 level.
Operating profit, excluding non-recurring items, is expected to remain at
the 2013 level or improve slightly.
CEO PEKKA OJANPÄÄ:
‘Economic uncertainty decreases the demand in the industrial sector and on
material flows in the construction and retail sectors. Nevertheless, both
Environmental and Industrial Services grew organically. In a challenging
operating environment in Facility Services and Renewable Energy Sources, we
continued to improve the efficiency of operations. The divestment of the
Latvian business operations was part of the streamlining of L&T's business
portfolio. The operating result reported for the first quarter of 2014 was
significantly affected by the non-recurring impairment of EUR 6.4 million
related to the insolvency of the EcoStream Group. Nevertheless, we were able to
improve the Group's profitability year-on-year.'
GROUP NET SALES AND FINANCIAL PERFORMANCE
Lassila & Tikanoja's net sales for the first quarter decreased by 4.9% to EUR
159.4 million (EUR 167.7 million). Operating profit was EUR 2.1 million (EUR
6.3 million). Operating profit excluding non-recurring items was EUR 7.4
million (EUR 6.8 million), representing 4.7% (4.1%) of net sales. Earnings per
share were EUR -0.42 (EUR 0.12).
The operating profit recorded for the first quarter includes EUR 6.4 million of
non-recurring costs relating to holdings in EcoStream Oy, which has filed for
bankruptcy, and to outstanding receivables from the EcoStream Group and L&T
Recoil. In addition, a non-recurring capital gain of EUR 1.1 million was
recognised on the Latvian business operations.
Furthermore, the Group's net profit was affected by the payment of EUR 16.7
million, in accordance with the loan guarantee commitment of to L&T Recoil,
recognised in financial expenses. After the entries related to EcoStream
Group's insolvency, the company has no liabilities related to EcoStream Oy and
L&T Recoil.
Profitability improved due to the good development of Environmental and
Industrial Services.
Financial summary
1-3/201 1-3/201 Change 1-12/201
4 3 % 3
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Net sales, EUR million 159.4 167.7 -4.9 668.2
Operating profit excluding non-recurring 7.4 6.8 9.4 51.8
items, EUR million*
Operating margin excluding non-recurring 4.7 4.1 7.8
items, %
Operating profit, EUR million 2.1 6.3 -65.9 33.2
Operating margin, % 1.3 3.8 5.0
Profit before tax, EUR million -15.5 5.9 30.3
Earnings per share, EUR -0.42 0.12 0.57
EVA, EUR million -19.3 0.9 12.4
--------------------------------------------------------------------------------
* Breakdown is presented below the division reviews.
NET SALES AND OPERATING PROFIT BY DIVISION
Environmental Services
The division's net sales for the first quarter increased by 1.2% to EUR 60.9
million (EUR 60.2 million). Operating profit and operating profit excluding
non-recurring items were EUR 6.6 million (EUR 6.2 million).
The division's net sales improved year-on-year both in Finland and
internationally as a result of high demand. However, growth was restricted by
the decrease in the volume of recyclable material, due to the market
conditions.
Profitability developed favourably, thanks to improved operational efficiency.
Industrial Services
The division's net sales for the first quarter totalled EUR 16.0 million (EUR
13.7 million), showing an increase of 16.4%. Operating loss and operating loss
excluding non-recurring items were EUR 0.1 million (EUR 0.5 million).
Net sales increased in all of the division's service lines. In particular,
demand increased in environmental construction and process cleaning.
The result was in the red, due to the seasonal nature of the business. However,
the loss decreased year-on-year, particularly as a result of the good
profitability of hazardous waste services.
Facility Services
The division's net sales for the first quarter were down by 8.9% to EUR 69.0
million (EUR 75.8 million). Operating profit totalled EUR 0.6 million (EUR 0.4
million). Operating profit excluding non-recurring items was EUR 0.6 million
(EUR 0.8 million).
The division's net sales declined year-on-year, due to business downsizing in
Sweden and lower than normal demand for seasonal work in Property Maintenance.
The division's profitability was weakened by the low profitability of damage
repair services and property maintenance.
The entire division is undergoing a major reorganisation process in order to
adapt operations to the changes in market conditions. This affects the
profitability of business. The benefits of the process will gradually start to
materialise in the second half of 2014.
Renewable Energy Sources
First quarter net sales of Renewable Energy Sources (L&T Biowatti) were down by
27.2% to EUR 15.8 million (EUR 21.8 million). Operating profit and operating
profit excluding non-recurring items were EUR 0.8 million (EUR 1.0 million).
The decrease in net sales could mostly be attributed to the very short heating
season. This weighted the result. As a result of efficiency improvement
measures, relative profitability improved year-on-year.
BREAKDOWN OF OPERATING PROFIT EXCLUDING NON-RECURRING ITEMS
EUR million 1-3/2014 1-3/2013 1-12/2013
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Operating profit 2.1 6.3 33.2
Non-recurring items:
Gain on sale of L&T Biowatti Oy equipment -0.5
Impairment of EcoStream Oy shares 5.0
L&T Recoil Oy 6.4
Divestment of Latvian business operations -1.1
Impairment of goodwill in Swedish business 7.0
operations
Potential costs of closure of divested land areas 5.0
Discontinuation of the sewer repair business 1.2
Restructuring costs 0.5 1.0
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Operating profit excluding non-recurring items 7.4 6.8 51.8
FINANCING
Cash flows from operating activities amounted to EUR 13.7 million (EUR 27.0
million). A total of EUR 3.8 million in working capital was released (EUR 12.9
million released).
At the end of the period, interest-bearing liabilities amounted to EUR 112.1
million (EUR 97.4 million).
During the period, the company made a payment of EUR 16.7 million to the
financing banks of the bankrupt company L&T Recoil Oy, in accordance with the
loan guarantee commitment as announced on 21 March 2014.
Net interest-bearing liabilities amounted to EUR 83.3 million, showing an
increase of EUR 18.9 million from the beginning of the year and a decrease of
EUR 0.3 million year-on-year.
Net financial expenses in the first quarter amounted to EUR 17.6 million (EUR
0.4 million) Net financial expenses were 11.0% (0.2%) of net sales. The
increase in net financial expenses was mostly due to the EUR 16.7 million
payment made under the L&T Recoil Oy guarantee commitment. In addition, changes
in exchange rates of unhedged loan receivables from foreign subsidiaries had an
effect of EUR 0.5 million on the expenses.
The average interest rate on long-term loans (with interest-rate hedging) was
1.7% (2.2%). Long-term loans totalling EUR 16.3 million will mature during the
rest of the year.
The equity ratio was 40.1% (46.3%) and the gearing rate was 47.4 (38.9). Liquid
assets at the end of the period amounted to EUR 28.7 million (EUR 13.8
million).
Of the EUR 100 million commercial paper programme, EUR 30.0 million (EUR 16.0
million) was in use at the end of the period. A committed limit totalling EUR
30.0 million was not in use, as was the case in the comparison period.
DISTRIBUTION OF ASSETS
The Annual General Meeting held on 19 March 2014 resolved that a dividend of
EUR 0.50 per share be paid on the basis of the balance sheet that was adopted
for the financial year 2013. The dividend, totalling EUR 19.4 million, was paid
to shareholders on 31 March 2014.
CAPITAL EXPENDITURE
In the first quarter of 2014, gross capital expenditure totalled EUR 9.0
million (EUR 5.9 million), consisting mainly of machine and equipment
purchases.
PERSONNEL
In the first quarter of the year, the average number of employees converted
into full-time equivalents was 7,683 (7,938). At the end of the period, Lassila& Tikanoja had 7,836 (8,988) full-time and part-time employees. Of these, 7,040
(7,074) worked in Finland and 796 (1,914) in other countries.
SHARE AND SHARE CAPITAL
Traded volume and price
The volume of trading on NASDAQ OMX Helsinki in January-March 2014, excluding
the shares held by the company in Lassila & Tikanoja plc, was 2,065,476 shares,
which is 5.3% (4.9%) of the average number of outstanding shares. The value of
trading was EUR 29.9 million (EUR 23.8 million). The trading price varied
between EUR 13.99 and EUR 15.84. The closing price was EUR 14.50. At the end of
the period, the market capitalisation excluding the shares held by the company
was EUR 561.2 million (EUR 485.3 million).
Own shares
At the beginning of the year, the company held 92,246 of its own shares and at
the end of the period 51,409, representing 0.1% of all shares and votes.
Share capital and number of shares
The company's registered share capital amounts to EUR 19,399,437 and the number
of outstanding shares is 38,747,465. The average number of shares excluding the
shares held by the company was 38,717,933.
Share-based incentive programme 2014
On 18 December 2013, Lassila & Tikanoja plc's Board of Directors decided on a
new share-based incentive programme for 2014 as part of the key personnel's
incentive and commitment system. The earnings period of the programme began on
1 January 2014 and ends on 31 December 2014. Any rewards to be paid for 2014
will be based on the Group's EVA result. Possible rewards will be paid partly
as shares and partly in cash. A maximum of 39,105 Lassila & Tikanoja shares may
be paid out under the programme. The programme covers 10 persons.
Shareholders
At the end of the period, the company had 9,326 (9,759) shareholders.
Nominee-registered holdings accounted for 21.3% (16.6%) of the total number of
shares.
Authorisation for the Board of Directors
The Annual General Meeting held on 19 March 2014 authorised Lassila & Tikanoja
plc's Board of Directors to make decisions on the repurchase of the company's
own shares using the company's unrestricted equity. In addition, the Annual
General Meeting authorised the Board of Directors to decide on the share issue
and the issuance of special rights entitling to shares.
The Board of Directors is authorised to purchase a maximum of 2,000,000 company
shares (5.2% of the total number of shares). The repurchase authorisation is
effective for 18 months.
The Board of Directors is authorised to decide on the issuance of new shares or
shares possibly held by the company through a share issue and/or issuance of
option rights or other special rights entitling to shares, referred to in
Chapter 10, Section 1 of the Finnish Companies Act, so that under the
authorisation a maximum of 2,000,000 shares (5.2% of the total number of
shares) may be issued and/or conveyed. The share issue authorisation is
effective for 18 months.
RESOLUTIONS BY THE ANNUAL GENERAL MEETING
The Annual General Meeting, which was held on 19 March 2014, adopted the
financial statements and consolidated financial statements for 2013 and
released the members of the Board of Directors and the President and CEO from
liability.
The Annual General Meeting resolved that a dividend of EUR 0.50 per share,
totalling EUR 19.4 million, be paid on the basis of the balance sheet to be
adopted for the financial year 2013. It was decided that the dividend be paid
on 31 March 2014.
The Annual General Meeting confirmed the number of members of the Board of
Directors as six. Heikki Bergholm, Eero Hautaniemi, Hille Korhonen, Sakari
Lassila and Miikka Maijala were re-elected and Laura Lares was elected as a new
member to the Board until the end of the following Annual General Meeting.
KPMG Oy Ab, Authorised Public Accountants, was elected auditor. KPMG Oy Ab
named Lasse Holopainen, Authorised Public Accountant, as its principal auditor.
The resolutions of the Annual General Meeting were announced in more detail in
a stock exchange release on 19 March 2014.
BOARD OF DIRECTORS
The members of Lassila & Tikanoja plc's Board of Directors are Heikki Bergholm,
Eero Hautaniemi, Hille Korhonen, Laura Lares, Sakari Lassila and Miikka
Maijala. At its organising meeting held after the Annual General Meeting, the
Board of Directors elected Heikki Bergholm as Chairman of the Board and Eero
Hautaniemi as Vice Chairman.
Eero Hautaniemi was elected as Chairman and Sakari Lassila and Laura Lares as
members of the audit committee. Heikki Bergholm was elected as Chairman and
Hille Korhonen and Miikka Maijala as members of the remuneration committee.
SUMMARY OF STOCK EXCHANGE RELEASES PURSUANT TO ARTICLE 4, CHAPTER 6 OF THE
SECURITIES MARKET ACT
In a release published on 3 March 2014, the company announced that Lassila &
Tikanoja and Bioinvest SIA have signed an agreement on the sale of L&T's
business operations in Latvia to Bioinvest SIA. In a release published on 13
March 2014, the company announced that the divestment of the business
operations has been completed. The total net sales of the divested business
operations amount to approximately EUR 16 million, most of which is allocated
to the Environmental Services division. As a result of the divestment,
approximately 950 employees transferred to Bioinvest.
In a release published on 21 March 2014, the company announced that it had been
informed that the financiers of the EcoStream Group had called in a loan
granted to L&T Recoil Oy, part of the EcoStream Group. In addition, the company
announced that it had received a claim from the financing banks to pay
approximately EUR 16.7 million on the basis of a loan guarantee commitment
associated with L&T Recoil Oy's loans.
Lassila & Tikanoja's total risk associated with the EcoStream Group, including
the above guarantee commitment, is approximately EUR 23.4 million as announced
earlier. Of this amount, the above guarantee commitment of approximately EUR
16.7 has an effect on cash flow.
EVENTS AFTER THE REVIEW PERIOD
The company management is not aware of any events of material importance that
might have affected the preparation of the interim report.
NEAR-TERM RISKS AND UNCERTAINTIES
Economic uncertainty may result in major changes in Environmental Services'
secondary raw material markets and in demand for Industrial Services.
Uncertainties associated with government subsidies for renewable fuels and with
the continuity of such subsidies may affect demand for the services of
Renewable Energy Sources.
More detailed information on L&T's risks and risk management is available in
the Annual Report for 2013, in the Report of the Board of Directors and in the
consolidated financial statements.
OUTLOOK FOR THE REST OF THE YEAR
Comparable net sales in 2014 are expected to remain at the 2013 level.
Operating profit, excluding non-recurring items, is expected to remain at the
2013 level or improve slightly.
CONDENSED FINANCIAL STATEMENTS 1 JANUARY - 31 MARCH 2014
CONSOLIDATED INCOME STATEMENT
EUR million 1-3/20 1-3/20 Change% 1-12/
14 13 2013
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Net sales 159.4 167.7 -4.9 668.2
Cost of sales -145.0 -154.4 -6.0 -597.3
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Gross profit 14.4 13.4 7.8 70.9
Other operating income 1.7 0.4 361.1 4.3
Sales and marketing expenses -3.8 -3.6 3.5 -14.5
Administrative expenses -3.5 -3.2 8.4 -13.0
Other operating expenses -6.7 -0.5 1,122.8 -2.5
Impairment, property, plant and equipment and -5.0
other non-current assets
Impairment, goodwill and other intangible -7.0
assets
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Operating profit 2.1 6.3 -65.9 33.2
Financial income 0.1 0.2 -40.2 0.5
Financial expenses -17.7 -0.6 2,922.7 -3.4
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Profit before tax -15.5 5.9 -363.0 30.3
Income taxes -0.9 -1.4 -40.5 -8.1
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Profit for the period -16.3 4.4 -467.6 22.2
Attributable to:
Equity holders of the company -16.3 4.5 22.2
Non-controlling interest 0.0 0.0 0.0
Earnings per share attributable to equity
holders of the parent company:
Earnings per share, EUR -0.42 0.12 0.57
Diluted earnings per share, EUR -0.42 0.12 0.57
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
EUR million 1-3/201 1-3/201 1-12/201
4 3 3
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Profit for the period -16.3 4.4 22.2
Items not to be recognised through profit or loss
Items arising from re-measurement of defined benefit 0.1
plans
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Items not to be recognised through profit or loss, 0.1
total
Items potentially to be recognised through profit or
loss
Hedging reserve, change in fair value -0.3 1.0 -0.4
Revaluation reserve
Gains in the period 0.0 0.0 0.0
--------------------------------------------------------------------------------
Current available-for-sale financial assets 0.0 0.0 0.0
Currency translation differences -0.4 0.3 -0.4
Currency translation differences recognised in 0.3 0.0 0.0
profit or loss
Currency translation differences, non-controlling 0.0 0.0 0.0
interest
---------------------------
Items potentially to be recognised through profit or -0.4 1.2 -0.8
loss, total
--------------------------------------------------------------------------------
Total comprehensive income, after tax -16.7 5.7 21.4
Attributable to:
Equity holders of the company -16.7 5.7 21.5
Non-controlling interest 0.0 0.0 0.0
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
EUR million 3/2014 3/2013 12/2013
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
ASSETS
Non-current assets
Intangible assets
Goodwill 108.5 120.4 112.8
Customer contracts arising from acquisitions 5.0 7.1 5.1
Agreements on prohibition of competition 0.1 1.5 0.4
Other intangible assets arising from business 0.0 0.1 0.0
acquisitions
Other intangible assets 8.0 8.3 8.0
--------------------------------------------------------------------------------
121.6 137.4 126.3
Property, plant and equipment
Land 3.4 3.8 3.8
Buildings and constructions 48.1 51.5 49.7
Machinery and equipment 109.9 117.8 115.8
Other 0.1 0.1 0.1
Prepayments and construction in progress 2.4 3.5 2.2
--------------------------------------------------------------------------------
164.0 176.7 171.5
Other non-current assets
Holdings in associated companies 0.0 0.0
Available-for-sale investments 0.6 7.3 4.3
Finance lease receivables 3.7 3.6 3.7
Deferred tax assets 2.9 3.5 2.8
Other receivables 2.4 6.0 2.4
--------------------------------------------------------------------------------
9.5 20.4 13.2
Total non-current assets 295.2 334.5 311.0
Current assets
Inventories 26.8 23.9 26.1
Trade and other receivables 96.4 98.7 100.0
Derivative receivables 0.0 2.2 0.1
Prepayments 3.6 3.5 0.3
Current available-for-sale financial assets 0.0 2.0 0.0
Cash and cash equivalents 28.7 11.8 58.5
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Total current assets 155.5 142.0 185.0
Total assets 450.7 476.5 496.0
--------------------------------------------------------------------------------
EUR million 3/2014 3/2013 12/2013
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
EQUITY AND LIABILITIES
Equity
Equity attributable to equity holders of the parent
company
Share capital 19.4 19.4 19.4
Other reserves -1.9 0.5 -1.5
Invested unrestricted equity reserve 0.3 6.1 0.3
Retained earnings 174.1 184.3 170.9
Profit for the period -16.3 4.5 22.2
--------------------------------------------------------------------------------
175.6 214.7 211.2
Non-controlling interest 0.2 0.3 0.2
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Total equity 175.8 215.0 211.5
Liabilities
Non-current liabilities
Deferred tax liabilities 25.1 31.1 25.8
Retirement benefit obligations 0.8 0.9 0.8
Provisions 6.1 4.3 6.1
Interest-bearing liabilities 65.0 52.2 65.9
Other liabilities 0.5 0.9 0.5
-------------------------------------------------------- ----------------
--------
97.6 89.4 99.0
Current liabilities
Interest-bearing liabilities 47.0 45.2 57.0
Trade and other payables 121.6 125.6 120.0
Derivative liabilities 0.8 0.8 0.5
Tax liabilities 4.7 0.0 4.7
Provisions 3.2 0.6 3.4
--------------------------------------------------------------------------------
177.3 172.1 185.5
Total liabilities 274.9 261.5 284.5
Total equity and liabilities 450.7 476.5 496.0
--------------------------------------------------------------------------------
CONSOLIDATED STATEMENT OF CASH FLOWS
EUR million 3/2014 3/2013 12/201
3
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Cash flows from operating activities
Profit for the period -16.3 4.4 22.2
Adjustments
Income taxes 0.9 1.4 8.1
Depreciation, amortisation and impairment 10.2 10.6 54.0
Financial income and expenses 17.6 0.4 2.9
Gain on sale of shares -1.5 - 0.0
Other 6.5 -0.1 3.8
--------------------------------------------------------------------------------
Net cash generated from operating activities before 17.4 16.8 91.0
change in working capital
Change in working capital
Change in trade and other receivables -0.7 -0.3 2.8
Change in inventories -0.7 1.0 -1.2
Change in trade and other payables 0.5 12.2 6.3
--------------------------------------------------------------------------------
Change in working capital -0.9 12.9 7.9
Interest paid -0.9 -0.6 -3.6
Interest received 0.1 0.1 0.5
Income taxes -2.0 -2.2 -9.3
--------------------------------------------------------------------------------
Net cash from operating activities 13.7 27.0 86.4
Cash flows from investing activities
Acquisition of subsidiaries and businesses, net of cash -2.0
acquired
Proceeds from sale of subsidiaries and businesses, net 11.7
of sold cash
Purchases of property, plant and equipment and -5.9 -4.9 -28.1
intangible assets
Proceeds from sale of property, plant and equipment and 0.0 0.1 1.2
intangible assets
Change in other non-current receivables -0.6 0.0 0.4
Dividends received 0.0 0.0
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Net cash used in investing activities 3.2 -4.8 -26.5
Cash flows from financing activities
Change in short-term borrowings -5.0 4.0 22.9
Proceeds from long-term borrowings 30.0
Repayments of long-term borrowings -5.6 -3.8 -26.2
Dividends paid and other asset distribution -19.4 -23.2 -42.5
Guarantee commitments associated with L&T Recoil -16.7
--------------------------------------------------------------------------------
Net cash generated from financing activities -46.6 -23.0 -15.9
EUR million 3/2014 3/2013 12/2013
--------------------------------------------------------------------
--------------------------------------------------------------------
Net change in liquid assets -29.7 -0.8 44.1
Liquid assets at beginning of period 58.5 14.6 14.6
Effect of changes in foreign exchange rates -0.1 0.0 -0.2
--------------------------------------------------------------------
Liquid assets at end of period 28.7 13.8 58.5
Liquid assets
EUR million 3/2014 3/2013 12/2013--------------------------------------------------------------------
--------------------------------------------------------------------
Cash and cash equivalents 28.7 11.8 58.5
Available-for-sale financial assets 0.0 2.0 0.0
--------------------------------------------------------------------
Total 28.7 13.8 58.5
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
EUR Share Curren Revalu Hedgin Invest Retain Equity Non-co Total
millio capita cy ation g ed ed attribu ntroll equity
n l transl reserv reserv unrest earnin table ing
ation e e ricted gs to intere
differ equity equity st
ences reserv holders
e of the
parent
company
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Equity 19.4 -0.8 0.0 0.0 29.4 184.5 232.5 0.3 232.8
on 1
Jan.
2013
Total
compre
hensive
income
Profit 4.5 4.5 0.0 4.5
for
the
period
Items 0.0 0.0 0.0
arisin
g from
remeas
urement
of
define
d
benefi
t plans
Hedging 1.0 1.0 0.0 1.0
reserv
e,
change
in
fair
value
Availab 0.0 0.0 0.0 0.0
le-for-
sale
financ
ial
assets
Currenc 0.3 0.3 0.0 0.2
y
transl
ation
differ
ences
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Total 0.3 0.0 1.0 0.0 4.5 5.7 0.0 5.7
compre
hensive
income
Transac
tions
with
shareh
olders
Share-b 0.1 0.1 0.1
ased
benefi
ts
Dividen
ds paid
Dividen
ds
return
ed
Capital -23.3 0.3 -23.0 -23.0
repaym
ent
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Transac -23.3 0.4 -22.9 -22.9
tions
with
shareh
olders,
total
Other -0.6 -0.6 -0.6
change
s
--------------------------------------------------------------------------------
Equity 19.4 -0.5 0.0 1.0 6.1 188.7 214.7 0.3 215.0
on 31
Mar.
2013
--------------------------------------------------------------------------------
EUR Share Curren Revalu Hedgin Invest Retain Equity Non-co Total
millio capita cy ation g ed ed attribu ntroll equity
n l transl reserv reserv unrest earnin table ing
ation e e ricted gs to intere
differ equity equity st
ences reserv holders
e of the
parent
company
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Equity 19.4 -1.2 0.0 -0.3 0.3 193.1 211.2 0.2 211.5
on 1
Jan.
2014
Total
compre
hensive
income
Profit -16.3 -16.3 0.0 -16.3
for
the
period
Items 0.0 0.0
arisin
g from
remeas
urement
of
define
d
benefi
t plans
Hedging -0.3 -0.3 -0.3
reserv
e,
change
in
fair
value
Availab 0.0 0.0
le-for-
sale
financ
ial
assets
Currenc -0.0 0.0 0.0
y
transl
ation
differ
ences
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Total 0.0 0.0 -0.3 0.0 -16.3 -16.7 0.0 -16.7
compre
hensive
income
Transac
tions
with
shareh
olders
Share-b -0.1 -0.1 -0.1
ased
benefi
ts
Dividen -19.4 -19.4 -19.4
ds paid
--------------------------------------------------------------------------------
Transac -19.5 -19.5 -19.5
tions
with
shareh
olders,
total
Other 0.5 0.5 0.5
change
s
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Equity 19.4 -1.3 0.0 -0.6 0.3 157.8 175.6 0.2 175.8
on 31
Mar.
2014
--------------------------------------------------------------------------------
KEY FIGURES
1-3/201 1-3/201 1-12/201
4 3 3
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Earnings per share, EUR -0.42 0.12 0.57
Diluted earnings per share, EUR -0.42 0.12 0.57
Cash flows from operating activities per share, EUR 0.35 0.70 2.23
EVA, EUR million -3.0 0.9 12.4
Capital expenditure, EUR million 9.0 5.9 32.7
Depreciation, amortisation and impairment, EUR 10.2 10.6 54.0
million
Equity per share, EUR 4.53 5.55 5.46
Return on equity, ROE, % -33.8 7.9 10.0
Return on invested capital, ROI, % 2.9 8.0 10.6
Equity ratio, % 40.1 46.3 43.7
Gearing, % 47.4 38.9 30.4
Net interest-bearing liabilities, EUR million 83.3 83.6 64.4
Average number of employees in full-time equivalents 7,683 7,938 8,267
Total number of full-time and part-time employees at 7,836 8,988 8,847
end of period
Number of outstanding shares adjusted for issues,
1,000 shares
average during the period 38,718 38,696 38,704
at end of period 38,747 38,707 38,707
average during the period, diluted 38,724 38,702 38,721
ACCOUNTING POLICIES
This interim report is in compliance with the IAS 34 (Interim Financial
Reporting) standard. The interim report has been prepared with application of
the IFRS standards and interpretations in effect on 31 December 2013.
From the beginning of 2014, the figures in the interim report tables are
presented in millions of euros. The comparison figures have been restated
accordingly. The figures are rounded to the nearest 0.1 million euros and,
consequently, the sum of individual figures may deviate from the sum total
presented.
More detailed information on accounting policies is presented in the
consolidated financial statements of Lassila & Tikanoja plc, released on 26
February 2014.
The interim report has not been audited.
SEGMENT INFORMATION
Net sales
1-3/ 1-3/
2014 2013
EUR million Extern Interdiv Total Extern Interdiv Total Total net
al ision al ision sales, change
%
--------------------------------------------------------------------------------
Environmental 60.2 0.8 60.9 59.1 1.1 60.2 1.2
Services
Industrial 15.5 0.5 16.0 13.1 0.7 13.7 16.4
Services
Facility 68.0 1.0 69.0 74.8 1.0 75.8 -8.9
Services
Renewable 15.8 0.1 15.8 20.7 1.0 21.8 -27.2
Energy
Sources
Eliminations -2.4 -2.4 -3.8 -3.8
--------------------------------------------------------------------------------
-------
Total 159.4 0.0 159.4 167.7 0.0 167.7 -4.9
1-12/
2013
EUR million External Interdivision Total
--------------------------------------------------------
Environmental Services 254.1 3.8 257.9
Industrial Services 72.1 3.4 75.5
Facility Services 287.8 4.7 292.5
Renewable Energy Sources 54.1 3.9 58.0
Eliminations -15.8 -15.8
--------------------------------------------------------
Total 668.2 0.0 668.2
Operating profit
EUR million 1-3/2014 % 1-3/2013 % 1-12/2013 %
-------------------------------------------------------------------------------
Environmental Services 6.6 10.9 6.2 10.3 30.1 11.7
Industrial Services -0.1 -0.9 -0.5 -3.8 5.2 6.9
Facility Services 0.6 0.8 0.4 0.6 4.4 1.5
Renewable Energy Sources 0.8 5.2 1.0 4.4 1.4 2.5
Group administration and other -5.7 -0.8 -8.0
-------------------------------------------------------------------------------
Total 2.1 1.3 6.3 3.8 33.2 5.0
Financial expenses, net -17.6 -0.4 -2.9
-------------------------------------------------------------------------------
Profit before tax -15.5 5.9 30.3
OTHER SEGMENT INFORMATION
EUR million 1-3/2014 1-3/2013 12/2013
-------------------------------------------------------------
Assets
Environmental Services 207.3 219.7 214.5
Industrial Services 72.9 70.3 70.0
Facility Services 99.0 115.1 103.4
Renewable Energy Sources 30.4 29.7 29.4
Group administration and other 1.3 16.0 7.5
Unallocated assets 39.8 25.8 71.3
-------------------------------------------------------------
L&T total 450.7 476.5 496.0
Liabilities
Environmental Services 50.2 45.2 51.8
Industrial Services 20.1 19.5 21.5
Facility Services 50.1 55.2 49.6
Renewable Energy Sources 8.1 10.8 5.5
Group administration and other 3.4 1.0 2.1
Unallocated liabilities 143.0 129.8 154.0
-------------------------------------------------------------
L&T total 274.9 261.5 284.5
EUR million 1-3/2014 1-3/2013 1-12/2013
-------------------------------------------------------------
Capital expenditure
Environmental Services 6.1 2.5 15.7
Industrial Services 1.0 0.5 3.2
Facility Services 1.8 2.7 11.3
Renewable Energy Sources 0.1 0.0 0.3
Group administration and other 0.0 0.2 2.2
-------------------------------------------------------------
L&T total 9.0 5.9 32.7
Depreciation and amortisation
Environmental Services 5.2 5.6 21.9
Industrial Services 1.6 1.7 6.6
Facility Services 3.3 3.2 13.2
Renewable Energy Sources 0.1 0.1 0.3
Group administration and other 0.0 0.0 0.0
-------------------------------------------------------------
L&T total 10.2 10.6 42.0
Impairment
Environmental Services
Industrial Services
Facility Services 7.0
Renewable Energy Sources
Group administration and other 5.0
-------------------------------------------------------------
L&T total 0.0 0.0 12.0
INCOME STATEMENT BY QUARTER
EUR million 1-3/ 10-12/ 7-9/ 4-6/ 1-3/
2014 2013 2013 2013 2013
------------------------------------------------------------------
Net sales
Environmental Services 60.9 65.7 65.4 66.6 60.2
Industrial Services 16.0 20.9 20.9 20.0 13.7
Facility Services 69.0 71.7 71.6 73.4 75.8
Renewable Energy Sources 15.8 15.8 7.4 13.0 21.8
Group administration and other
Interdivision net sales -2.4 -4.4 -3.5 -4.1 -3.8
------------------------------------------------------------------
L&T total 159.4 169.7 161.9 168.9 167.7
Operating profit
Environmental Services 6.6 2.9 11.9 9.1 6.2
Industrial Services -0.1 1.6 2.3 1.9 -0.5
Facility Services 0.6 -5.6 6.7 2.8 0.4
Renewable Energy Sources 0.8 0.6 -0.2 0.1 1.0
Group administration and other -5.7 -1.1 -0.7 -5.4 -0.8
------------------------------------------------------------------
L&T total 2.1 -1.6 20.0 8.5 6.3
Operating margin
Environmental Services 10.9 4.5 18.2 13.6 10.3
Industrial Services -0.9 7.6 10.9 9.5 -3.8
Facility Services 0.8 -7.8 9.4 3.9 0.6
Renewable Energy Sources 5.2 3.7 -2.7 0.7 4.4
------------------------------------------------------------------
-------------------------------
L&T total 1.3 -1.0 12.4 5.0 3.8
Financial expenses, net -17.6 -0.7 -1.1 -0.6 -0.4
------------------------------------------------------------------
Profit before tax -15.5 -2.3 18.9 7.9 5.9
BUSINESS ACQUISITIONS, COMBINED
EUR million Fair value
-------------------------------------------------------------
Intangible assets 0.6
Property, plant and equipment 0.5
Investments 0.0
Receivables 0.4
Cash and cash equivalents 0.8
-------------------------------------------------------------
Total assets 2.2
Interest-bearing liabilities 0.2
Other liabilities 0.5
Deferred tax liabilities 0.1
-------------------------------------------------------------
Total liabilities 0.8
Net assets acquired 1.4
Total consideration 2.8
Goodwill 1.4
Effect on cash flow
Consideration paid in cash -2.8
Cash and cash equivalents of the acquired company 0.8
-------------------------------------------------------------
Cash flow from investing activities -2.0
Environmental Services acquired Paperitiikerit Oy on 1 February 2014 and
Joutsan Kuljetus Oy on 1 March 2014.
The accounting policy concerning business combinations is presented under Note
2 of the financial statements and under accounting policies.
CHANGES IN INTANGIBLE ASSETS
EUR million 1-3/2014 1-3/2013 1-12/2013
---------------------------------------------------------------------
---------------------------------------------------------------------
Carrying amount at beginning of period 126.3 138.4 138.4
Business acquisitions 2.0
Other capital expenditure 0.7 0.6 2.6
Disposals -5.6
Amortisation and impairment -1.6 -1.8 -14.0
Transfers between items -0.3
Exchange differences -0.2 0.2 -0.4
---------------------------------------------------------------------
Carrying amount at end of period 121.6 137.4 126.3
CHANGES IN PROPERTY, PLANT AND EQUIPMENT
EUR million 1-3/2014 1-3/2013 1-12/2013
---------------------------------------------------------------------
---------------------------------------------------------------------
Carrying amount at beginning of period 171.5 180.2 180.2
Business acquisitions 0.5
Other capital expenditure 5.8 5.3 28.1
Disposals -4.9 -0.1 -1.3
Depreciation and impairment -8.6 -8.7 -35.0
Transfers between items 0.3
Exchange differences -0.4 0.1 -0.8
---------------------------------------------------------------------
Carrying amount at end of period 164.0 176.7 171.5
CAPITAL COMMITMENTS
EUR million 1-3/2014 1-3/2013 1-12/2013
------------------------------------------------------------
------------------------------------------------------------
Intangible assets
Property, plant and equipment 7.6 4.9 4.0
------------------------------------------------------------
Total 7.6 4.9 4.0
FINANCIAL ASSETS AND LIABILITIES BY CATEGORY
EUR Financia Loans Availabl Financi Deriva Carrying Fair Fair
millio l assets and e-for-sa al tives amounts values value
n and other le liabili under by by hierar
liabilit receiva financia ties hedge balance balance chy
ies bles l assets measure accoun sheet sheet level
at fair d at ting item item
value amortis
through ed cost
profit
or loss
-------------------------------------------------------------------------
-------
Non-cur
rent
financ
ial
assets
Availab 0.6 0.6 0.6 3
le-for-
sale
invest
ments
Finance 3.7 3.7 3.8 2
lease
receiv
ables
Other 2.1 2.1 2.1
receiv
ables
Current
financ
ial
assets
Trade 85.1 85.1 85.1
and
other
receiv
ables
Derivat
ive
receiv
ables
Cash 28.7 28.7 28.7
and
cash
equiva
lents
-------------------------------------------------------------------------
Total 119.6 0.6 120.2 120.4
financ
ial
assets
Non-cur
rent
financ
ial
liabil
ities
Borrowi 65.0 65.0 65.1 2
ngs
Other 0.2 0.2 0.2
liabil
ities
Current
financ
ial
liabil
ities
Borrowi 47.0 47.0
ngs
Trade 57.4 57.4
and
other
payabl
es
Derivat 0.8 0.8 0.8 2
ive
liabil
ities
-------------------------------------------------------------------------
Total 169.7 0.8 170.5 66.1
financ
ial
liabil
ities
CONTINGENT LIABILITIES
Securities for own commitments
EUR million 1-3/2014 1-3/2013 1-12/2013
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Mortgages on rights of tenancy 0.2 0.2 0.1
Company mortgages 1.0 0.6 0.6
Other securities 0.2 0.2 0.2
Bank guarantees required for environmental 9.5 8.7 9.5
permits
Other securities are security deposits.
Operating lease liabilities
EUR million 1-3/2014 1-3/2013 1-12/2013
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Maturity not later than one year 4.6 5.2 5.0
Maturity later than one year and not later than 3.9 7.5 6.1
five years
Maturity later than five years 2.1 2.2 2.2
--------------------------------------------------------------------------------
Total 10.6 14.9 13.4
Liabilities associated with derivative agreements
Cross currency interest rate swaps
EUR million 1-3/201 1-3/201 1-12/201
4 3 3
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Maturity of cross currency interest rate swaps under
hedge accounting
Maturity not later than one year 7.2 12.8 7.2
Maturity later than one year and not later than five 8.7 15.9 9.5
years
--------------------------------------------------------------------------------
Total 15.9 28.7 16.7
Fair value -0.1 1.9 0.1
The contracts are used for the hedging of foreign currency loans. The changes
in their fair values are shown on the consolidated statement of comprehensive
income. On 31 March 2014, the value of foreign currency loans was approximately
EUR 0.1 million positive.
Interest rate swaps
EUR million 1-3/2014 1-3/2013 1-12/2013
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Nominal values of interest rate swaps
Maturity not later than one year 9.0 18.5 14.0
Maturity later than one year and not later than 45.9 23.1 16.7
five years
Maturity later than five years 0.9 2.7 0.9
--------------------------------------------------------------------------------
Total 55.9 0.0 31.7
Fair value -0.4 -0.8 -0.4
The interest rate swaps are used for the hedging of cash flow related to
floating rate loans, and hedge accounting under IAS 39 has been applied to
them. The hedges have been effective, and the changes in their fair values are
shown on the consolidated statement of comprehensive income for the period.
The fair values of the swap contracts are based on the market data on the
balance sheet date.
Commodity derivatives
Metric tonnes 1-3/2014 1-3/2013 1-12/2013
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Nominal values of diesel swaps
Maturity not later than one year 7.4 4.5 9.7
Maturity later than one year and not later than 0.8 0.0 0.8
five years
--------------------------------------------------------------------------------
Total 8.3 4.5 10.6
Fair value -0.3 0.2 -0.1
Commodity derivative contracts were signed for the hedging of future diesel oil
purchases. IAS 39-compliant hedge accounting is applied to these contracts, and
the effective change in fair value is recognised in the hedging reserve within
equity. The fair values of commodity derivatives are based on market prices on
the balance sheet date.
Currency derivatives
EUR million 1-3/2014 1-3/2013 1-12/2013
------------------------------------------------------------------
------------------------------------------------------------------
Nominal values of forward contracts
Maturity not later than one year 0.0 0.5 0.0
Fair value 0.0 0.0 0.0
Hedge accounting under IAS 39 has not been applied to forward contracts.
Changes in fair value have been recognised in financial income and expenses.
CALCULATION OF KEY FIGURES
Earnings per share:
profit attributable to equity holders of the parent company / adjusted average
basic number of shares
Diluted earnings per share:
profit attributable to equity holders of the parent company / adjusted average
diluted number of shares
Cash flows from operating activities/share:
cash flow from operating activities as in the statement of cash flows /
adjusted average
basic number of shares
EVA:
operating profit - cost calculated on invested capital (average of four
quarters)
WACC 2013: 6.52% and 2014: 6.58%
Equity per share:
profit attributable to equity holders of the parent company / adjusted basic
number of shares at end of period
Return on equity, % (ROE):
(profit for the period / equity (average)) x 100
Return on invested capital, % (ROI):
(profit before tax + financial expenses) / (total equity and liabilities -
non-interest-bearing liabilities (average)) x 100
Equity ratio, %:
equity / (total equity and liabilities - advances received) x 100
Gearing, %:
net interest-bearing liabilities / equity x 100
Net interest-bearing liabilities:
interest-bearing liabilities - liquid assets
Operating profit excluding non-recurring items:
operating profit +/- non-recurring items
Helsinki, 25 April 2014
LASSILA & TIKANOJA PLC
Board of Directors
Pekka Ojanpää
President and CEO
For additional information, please contact:
Pekka Ojanpää, President and CEO, tel. +358 10 636 2810
Timo Leinonen, CFO, tel. +358 400 793 073
Lassila & Tikanoja is a service company that is transforming consumer society
into an efficient
recycling society. In co-operation with our customers, we are reducing waste
volumes, extending
the useful lives of properties, recovering materials and decreasing the use of
raw materials and energy. We help our customers to focus on their core business
and protect the environment. Together, we create well-being and jobs. With
operations in Finland, Sweden and Russia, L&T employs 8,000 persons. Net sales
in 2013 amounted to EUR 668 million. L&T is listed on NASDAQ OMX Helsinki.
Distribution:
NASDAQ OMX Helsinki
Major media
www.lassila-tikanoja.com
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