INTERIM REPORT for January 1 ? March 31,
LÄNNEN TEHTAAT PLC STOCK EXCHANGE RELEASE May 13, 2004 at 9;00 am
INTERIM REPORT for January 1 March 31, 2004
Lännen Tehtaats net turnover for January-March 2004 was EUR 123.9
million (Jan-Mar 2003: EUR 113.5 million). Operating profit for the
period was EUR 0.5 million (EUR 0.1 million) and profit before
extraordinary items EUR 0.3 million (EUR 1.1 million). Earnings per
share came to EUR 0.00 (EUR 0.08).
Net turnover
Lännen Tehtaats net turnover for January-March 2004 was EUR 123.9
million (Jan-Mar 2003: EUR 113.5 million). The increase on the
previous years figure was attributable to the growth in grain trade
net turnover. Net turnover by division was as follows: Food Division
EUR 25.1 million (EUR 24.7 million), Agricultural Division EUR 78.1
million (EUR 66.8 million) and Machinium Division EUR 20.7 million
(EUR 22.0 million).
Financial performance
Although falling short of the target, Lännen Tehtaats financial
performance in the first quarter was an improvement on the same period
last year: operating profit for the period was EUR 0.5 million (EUR
0.1 million), profit before extraordinary items EUR 0.3 million (EUR
1.1 million) and profit after taxes and minority interests EUR 0.0
million (EUR 0.5 million). Earnings per share thus amounted to EUR
0.00 (EUR 0.08).
Taxes for the period came to EUR 0.3 million (Jan-Mar 2003: tax
receivable EUR 0.1 million).
Financing
The Groups interest-bearing liabilities at the end of the period
amounted to EUR 76.6 million (EUR 87.3 million) and financial assets
totalled EUR 18.1 million (EUR 13.5 million). The consolidated balance
sheet total was EUR 243.4 million (EUR 253.7 million) and the equity
ratio 40% (37%). Commercial papers were used for short-term financing
and liquidity was secured with long-term committed credit facilities.
No credit facilities were used. Overall, the Groups financing
position was good throughout the period, although the Machinium
Divisions restrictive financing situation has continued.
Investment
First-quarter investment was mainly in replacement and maintenance,
totalling EUR 1.4 million (EUR 4.1 million). The high level of
investment in 2003 included EUR 3.4 million on purchasing the head
office and staff restaurant buildings in Säkylä.
Decisions of the Annual General Meeting
The Annual General Meeting of March 24, 2004 decided that the dividend
to be distributed on 2003 will be EUR 0.65 per share (EUR 0.30).
The AGM authorized the Board of Directors to decide on whether to
raise the companys share capital by means of a new issue and/or by
issuing convertible bonds in one or more tranches. Such a new issue
and/or convertible bond issue may not increase the share capital by
more than EUR 1,224,514, which means a maximum of 611,257 shares
issued for subscription. The authorization remains valid for one year
after the Annual General Meeting. The share capital can be raised
and/or a convertible bond issued diverging from the pre-emptive
subscription right of shareholders if, from the companys viewpoint,
there exists a pressing financial reason for making such an exception.
The Board was also authorized to take decisions on surrendering the
companys own shares. The authorization allows the Board to surrender
the 65,000 company shares acquired. This may be done in connection
with corporate acquisitions or for some similar purpose, or the shares
can be sold in public trading on Helsinki Exchanges. The authorization
remains valid for one year after the AGM.
The 65,000 Lännen Tehtaat shares in the companys possession represent
1.1 per cent of the share capital and the votes.
Share trading
The volume of stock exchange trading in Lännen Tehtaat shares during
the period was 313,574 shares (21,961), or 5.1% (0.4%) of all Lännen
Tehtaat shares. The highest share price was EUR 12.50 (EUR 9.90) and
the lowest EUR 11.00 (EUR 8.70).
BUSINESS DIVISIONS
Food Division
Net turnover for the Food Division was EUR 25.1 million (EUR 24.7
million). Apetit Group sales were at the same level as last year,
while sugar sales were slightly up. Sales of frozen foods and fish
products were also up on last year. Sales of frozen vegetables,
however, were down on the 2003 figures. Sales of other frozen products
and jams and marmalades were about the same as last year.
Food Division profitability as a whole was at the same level as last
year and met the target set for it. Apetits profitability fell short
of last years level, however, as a result of reduced margins due to
tougher competition and the rise in raw-material prices. Apetits
performance was compensated by the improved performance of Lännens
associated company, Sucros. Operating profit for the Food Division was
EUR 0.8 million (EUR 0.8 million).
Ateriamestarit Oy, the new joint venture set up by Raisio Group and
Lännen Tehtaat, began operating at the end of April, when Raisio and
Lännen catering-sector personnel transferred to the new company. The
new company will manage Raisio and Lännen sales to customers in the
hotel, restaurant and catering business. The aim is to provide an
improved service to these customers by offering a wider product range.
Agricultural Division
Net turnover for the Agricultural Division was EUR 78.1 million (EUR
66.8 million). Net turnover in the animal feeds business was at last
years level, which was slightly short of the target. Grain trade net
turnover for Avena Nordic Grain was below the target, but rose to a
level surpassing last years figure. Other operations in the
Agricultural Division accounted for only a small proportion of the
Divisions net turnover.
Agricultural Division profitability was up on last years figure and
met the target set for it. Profitability in the animal feeds business
showed a distinct improvement on last years poor performance,
reaching a level close to the target thanks to the savings made in
costs. Grain trade profitability was slightly higher than last year
and a little above the target set, thanks to the growth in sales.
Operating profit for the Agricultural Division was EUR 1.4 million
(EUR 0.2 million).
Machinium Division
Net turnover for the Machinium Division was EUR 20.7 million (EUR 22.0
million), which was short of the target and was lower than last years
figure. Domestic sales of earthmoving machinery were up on last year,
whereas the reverse was true for sales in Sweden and the Baltic
States. Sales of materials handling machinery were below target and
were slightly less than last years figure.
First-quarter profitability for the Machinium Division was poor, and
the Division recorded a loss that was greater than its first-quarter
loss last year. Profitability in earthmoving machinery was
considerably weaker than a year ago, particularly so in Sweden,
although the performance in Finland and the Baltic States was also
down on last year. By contrast, profitability in materials handling
machinery was up on the 2003 figure, but still fell short of the
targets. The Machinium Divisions operating loss was EUR 1.7 million
(EUR 0.9 million).
Outlook for the rest of the year
The growth in net turnover for the Food Division is expected to follow
the general trend in the markets. Apetits sales for the full year are
forecast to be up slightly on last year. Although total sugar
consumption will not grow, it is expected that sales of Lännen Sugars
consumer products will be up on the exceptionally low level of 2003.
In the Agricultural Division, net turnover in the animal feeds
business is expected to be at last years level. Grain trade net
turnover will depend on the quantity and quality of this years
harvests in the main market areas. Turnover is nevertheless likely to
exceed last years figures.
The earthmoving and utility machinery markets are expected to be
unchanged from 2003 in both Finland and Sweden. In the Baltic States,
market growth is expected to continue. The market for materials
handling machinery in Sweden is forecast to remain unchanged. Net
turnover for the Machinium Division is expected to be somewhat higher
than last year.
Lännen Tehtaats consolidated net turnover for 2004 is expected to
exceed EUR 500 million.
The Groups financial performance, excluding the Machinium Division,
is expected to be similar to last year. The aim is to withdraw from
Machinium ownership during 2004. Lännen Tehtaats liabilities and
commitments concerning the Machinium Division will amount to EUR 7.3
million. The consolidated financial statements for 2003 include a
restructuring provision of EUR 1.9 million for the exit from Machinium
ownership. The measures required to complete this process are expected
to weaken the Groups profit performance in the latter part of the
year.
The next interim report, covering the period January 1 June 30,
2004, will be published on August 10.
CONSOLIDATED PROFIT AND LOSS ACCOUNT
1-3/ 1-3/ 1-12/
2004 2003 2003
EUR million
Net turnover 123.9 113.5 492.0
Other operating income 0.7 0.5 2.1
Costs and expenses -121.7 -111.3 -473.8
Depreciation -2.9 -2.8 -11.8
Share of profits of
associated undertakings 0.5 0.2 3.2
Operating profit 0.5 0.1 11.7
Finacial income and
expenses -0.8 -1.2 -3.3
Profit/loss before extra-
ordinary items and taxes -0.3 -1.1 8.4
Extraordinary income
Extraordinary expenses
Income taxes -0.3 0.1 -2.6
Minority interests 0.6 0.5 0.9
Profit/loss for the financial
period 0.0 -0.5 6.7
The tax corresponding to the profit for the period has been taken into
account as tax shown in the profit and loss statement.
CONSOLIDATED BALANCE SHEET
March 31, March 31, March 31,
2004 2003 2003
EUR million
Assets
Intangible assets 20.8 19.4 21.6
Tangible assets 64.8 71.5 65.6
Investments 23.1 21.8 21.9
Own shares 0.8 0.8 0.8
Stocks 72.6 79.5 80.2
Receivables 43.2 47.2 46.5
Marketable securities 0.5 3.3 1.5
Cash and cash equivalents 17.6 10.2 11.6
Total 243.4 253.7 249.7
Liabilities
Share capital 12.2 12.2 12.2
Other capital and reserves 83.2 78.4 82.8
Minority interests 3.9 5.6 4.9
Provisions 2.1 0.1 2.1
Long-term liabilities 48.3 68.2 48.3
Current liabilities 93.7 89.2 99.4
Total 243.4 253.7 249.7
CONSOLIDATED CASH FLOW STATEMENT
1-3/ 1-3/ 1-12/
2004 2003 2003
EUR million
Operations
Cash flow from operations 2.2 1.7 18.8
Change in working capital 3.7 -4.1 7.4
Net cash flow from
operations (A) 5.9 -2.4 26.2
Investments
Investments in non-current
assets -1.4 -4.0 -9.5
Proceeds from sales of
non-current assets 0.3 0.1 1.5
Net cash flow from
investments (B) -1.1 -3.9 -8.0
Financing
Change in loans 0.9 3.4 -18.0
Dividends paid -1.8
Other changes in capital and
reserves and in minority
interests -0.6 -0.6 -2.4
Net cash flow from
financing (C) 0.3 2.8 -22.2
Changes in liquid assets
(A+b+C) 5.1 -3.5 -4.0
Liquid assets on Jan 1 13.0 17.0 17.0
Liquid assets on March 31 18.1 13.5 13.0
KEY INDICATORS
March 31, March 31, Dec 31,
2004 2003 2003
Earnings per share, EUR 0.00 -0.08 1.11
Equity per share, EUR 15.35 14.55 15.29
Equity ratio, % 40.0 37.3 39.5
Gross investments, EURm 1.4 4.1 9.5
% of net turnover 1.1 3.6 1.9
BUSINESS SEGMENT INFORMATION
NET TURNOVER
1-3/ 1-3/ 1-12/
2004 2003 2003
EUR million
Food Division 25.1 24.7 114.9
Agricultural Division 78.1 66.8 282.6
Machinium Division 20.7 22.0 94.5
Total 123.9 113.5 492.0
OPERATING PROFIT
Food Division 0.8 0.8 6.5
Agricultural Division 1.4 0.2 8.3
Machinium Division -1.7 -0.9 -3.1
Total 0.5 0.1 11.7
AVERAGE PERSONNEL
1-3/ 1-3/ 1-12/
2004 2003 2003
Food Division 301 300 331
Agricultural Division 426 419 442
Machinium Division 391 376 388
Total 1118 1095 1161
CONTINGENT LIABILITIES
March 31, March 31, Dec 31,
2004 2003 2003
EUR million
Securities given for debts
Real estate mortgages 32.5 37.6 32.6
Corporate Mortgages 75.8 54.7 76.0
Shares pledged 3.6 43.4 3.6
Other securities given
Pledges 0.0 0.0 0.0
Corporate mortgages 6.9 8.2 6.9
Leasing liabilities 1.8 2.4 2.1
Contingent liabilities
for own commitments
Repurchasing commitments 18.3 17.7 19.0
Other commitments 2.1 1.4 2.4
Contingent liabilities on behalf
of associated undertakings
Guarantees 0.4
Other contingent liabilities
Redemption liability
of leased buildings 2.6 2.7 2.6
Outstanding derivative instruments
Forward currency contracts
Market value -0.2 -0.1 -0.3
Value of underlying instruments 6.7 8.9 9.5
Raw material futures
Market value -0.4 0.7 -0.5
Value of underlying instruments 6.9 16.3 10.6
Interest rate swaps
Value of underlying instruments 25.0 25.0 25.0
The data have not been audited.
LÄNNEN TEHTAAT PLC
Board of Directors
More details: Erkki Lepistö, President & CEO, tel. +358 2 8397 4001
Distribution:
Helsinki Exchanges
Main media
www.lannen.fi
