ATRIA GROUP PLC'S INTERIM REPORT, 1 JANUARY ? 30 JUNE 2005
Atria Group plc STOCK EXCHANGE RELEASE 26.7.2005 AT 10.00 AM.
ATRIA GROUP PLC'S INTERIM REPORT, 1 JANUARY 30 JUNE 2005
The Atria Group's operating profit for the review period was EUR
15.9 million (EUR 20.1 million). The Group's profit before taxes
was EUR 15.2 million (EUR 18.0 million). Turnover amounted to EUR
468.8 million (EUR 397.7 million), earnings per share to EUR 0.52
(EUR 0.65) and equity per share to EUR 12.36 (EUR 10.70).
CONSOLIDATED BALANCE SHEET
Assets
EUR million 30.6.05 30.6.04 31.12.04
Fixed assets
Intangible assets 20.1 13.7 13.8
Goodwill 36.1 34.5 34.6
Tangible assets 287.5 259.7 267.4
Calculatory tax
receivables on benefit-
based pension
responsibilities 0.1 1.6 0.1
Loan receivables and
other receivables 4.7 2.1 4.2
Investments 6.4 7.2 6.3
Total 354.9 318.8 326.4
Current assets
Inventories 56.6 43.7 48.0
Accounts receivable and
other receivables 145.5 97.5 131.6
Cash in hand
and at bank 6.1 11.7 12.6
Total 208.2 152.9 192.2
Assets, total 563.1 471.7 518.6
Liabilities
EUR million 30.6.05 30.6.04 31.12.04
Equity belonging to parent
company's
shareholders 241.0 224.0 244.3
Minority interests 19.7 1.6 19.6
Equity, total 260.7 225.6 263.9
Long-term borrowed capital
Interest-bearing debts 87.5 81.0 83.2
Calculatory tax debts 20.6 14.3 21.4
Pension liabilities 0.4 5.6 0.4
Total 108.5 100.9 105.0
Short-term borrowed capital
Interest-bearing debts 82.5 55.0 32.8
Accounts payable
and other debts 111.4 90.2 116.9
Total 193.9 145.2 149.7
Borrowed capital,
total 302.4 246.1 254.7
Liabilities, total 563.1 471.7 518.6
CONSOLIDATED PROFIT AND LOSS ACCOUNT
EUR million 4-6/05 4-6/04 1-6/05 1-6/04 1-12/04
Turnover 247.1 212.1 468.8 397.7 833.7
Expenses, excl.
the accrual of benefit-
based pensions -229.5 -193.4 -436.9 -365.7 -764.6
Accrual of benefit-
based pensions 3.1 3.0 8.1
Depreciations -8.0 -7.5 -16.0 -14.9 -27.9
Operating profit 9.6 14.3 15.9 20.1 49.3
* % of turnover 3.9% 6.7% 3.4% 5.1% 5.9%
Share of associated
company earnings 0.5 0.2 0.8 0.3 0.5
Financial income
and expenses -0.7 -1.1 -1.5 -2.4 -5.2
Profit before taxes 9.4 13.4 15.2 18.0 44.6
* % of turnover 3.8% 6.3% 3.2% 4.5% 5.3%
Taxes -2.5 -2.1 -4.1 -3.5 -8.5
Calculatory taxes on benefit-
based pensions' accrual -0.8 -0.8 -2.4
Profit for the financial
year 6.9 10.5 11.1 13.7 33.7
* % of turnover 2.8% 5.0% 2.4% 3.4% 4.0%
Attributable to:
Equity holders
of the parent 10.8 13.6 33.4
Minority interest 0.3 0.1 0.3
Total 11.1 13.7 33.7
Undiluted
earnings/share, 0.52 0.65 1.58
Earnings/share adjusted
by dilution effect, 0.52 0.65 1.58
CALCULATION OF CHANGES IN SHAREHOLDERS' EQUITY
mill. EUR
Equity belonging to the owners of Mino- Share
parent company rity's holder's
share equity
Share Share Trans- in total
equity premium lation
fund diff.
funds
Shareholders'
equity 1 Jan, 2004 35.8 104.4 79.3 219.5 1.6 221.1
Changes in shareholder's
equity 1 Jan - 31 Dec,
2004
Translation differences 0.5 0.5 0.5
Increase in
minority interest 17.6 17.6
Profit for the
financial year 33.4 33.4 0.3 33.7
Distribution
of dividends -9.0 -9.0 -9.0
Shareholders'
equity 31 Jan, 35.8 104.4 0.5 103.7 244.4 19.5 263.9
2004
Shareholders'
equity 1 Jan, 2005 35.8 104.4 0.5 103.7 244.4 19.5 263.9
Changes in shareholder's
equity 1 Jan - 30 Jun,
2005
Translation differences -1.7 -1.7 -1.7
Profit for the
financial year 10.8 10.8 0.3 11.1
Distribution
of dividends -12.5 -12.5 -12.5
Shareholders'
equity 30 Jun,
2005 35.8 104.4 -1.2 102.0 241.0 19.7 260.7
CONSOLIDATED CASH FLOW CALCULATION
EUR million 1-6/05 1-6/04 1-12/04
Cash flow
from operations 4.1 28.0 72.1
Financial items
and taxes -5.0 -4.4 -13.2
Cash flow
from operations -0.9 23.6 58.9
Investments
Investments in tangible
and intangible
assets -42.3 -16.9 -33.9
Investments -2.6 -0.3 0.5
Cash flow
from investments -44.9 -17.2 -33.4
Loans drawn down 61.4 25.8 12.8
Loans repaid -9.6 -21.4 -28.5
Dividends paid -12.5 -9.0 -9.0
Cash flow
from financing 39.3 -4.6 -24.7
Change in liquid
funds -6.5 1.8 0.8
INDICATORS
EUR million 1-6/05 1-6/04 1-12/04
Undiluted
earnings/share, 0.52 0.65 1.58
Earnings/share adjusted
by dilution effect, 0.52 0.65 1.58
Equity/share, 12.36 10.70 12.51
Interest-bearing
debts 170.0 136.0 116.0
Equity ratio, % 46.3 47.9 50.9
Gross investments 42.3 17.0 37.3
Gross investments
/turnover, % 9.0 4.3 4.5
Personnel on
average 4,296 3,615 3,638
SEGMENT-SPECIFIC DATA
GEOGRAPHICAL
EUR million 4-6/05 4-6/04 1-6/05 1-6/04 1-12/04 %
Turnover
Finland 161.8 133.9 306.5 253.3 525.8 63.1
Sweden 80.9 79.0 154.9 145.8 310.2 37.2
Others and
eliminations 4.4 -0.8 7.4 -1.4 -2.3 -0.3
Total 247.1 212.1 468.8 397.7 833.7 100.0
Operating profit
Finland 8.1 11.5 13.9 15.8 37.7 76.5
Sweden 2.1 3.2 2.8 4.8 12.1 24.5
Others and
eliminations -0.6 -0.4 -0.8 -0.5 -0.5 -1.0
Total 9.6 14.3 15.9 20.1 49.3 100.0
Investments
Finland 17.0 7.8 39.0 13.2 28.8 77.2
Sweden 1.2 1.6 1.9 3.1 6.9 18.5
Others 1.1 -0.2 1.4 0.7 1.6 4.3
Total 19.3 9.2 42.3 17.0 37.3 100.0
30.6.05 % 30.6.04 % 31.12.04 %
EUR million
Funds
Finland 476.8 84.7 389.3 82.5 433.7 83.6
Sweden 133.1 23.6 135.8 28.8 137.7 26.6
Others and
eliminations -46.8 -8.3 -53.4 -11.3 -52.8 -10.2
Total 563.1 100.0 471.7 100.0 518.6 100.0
Debts
Finland 222.5 73.6 172.9 70.3 180.2 70.7
Sweden 69.4 22.9 74.5 30.3 73.7 28.9
Others and
eliminations 10.5 3.5 -1.3 -0.5 0.8 0.3
Total 302.4 100.0 246.1 100.0 254.7 100.0
BUSINESS-RELATED
EUR million 1-6/05 % 1-6/04 % 1-12/04 %
Turnover
Meat Industries 361.7 77.2 345.9 87.0 710.8 85.3
Wholesale Trade 119.7 25.5 58.7 14.8 136.3 16.3
Eliminations -12.6 -2.7 -6.9 -1.7 -13.4 -1.6
Total 468.8 100.0 397.7 100.0 833.7 100.0
LIABILITIES
EUR million 30.6.05 30.6.04 31.12.04
Debts for which collateral has been provided
in the form of mortgages and other
securities
Loans from
financial
institutions 84.3 69.1 66.2
Pension fund loans 5.9 5.7 6.0
Total 90.2 74.8 72.2
Mortgages and other securities given
as comprehensive
security
Real-estate
mortgages 77.3 75.5 74.3
Corporate mortgages 43.4 37.9 43.0
Other collateral 50.2 45.4 41.3
Total 170.9 158.8 158.6
Contingent liabilities
not included in the balance
sheet
Unused limits 80.8 76.3 79.4
Guarantees 3.1 1.4 1.9
The figures are not audited.
The differences between the IFRS comparison data for the year 2004 and
the data as per the finnish reporting standard were published on 19.4.2005
(IFRS 1.45) and they may be viewed at our website www.atria.fi.
ATRIA BUSINESS RESULTS AT LAST YEAR'S LEVEL
In the first half of 2005, the Atria Group's turnover rose to EUR
468.8 million (EUR 397.7 million in 2004), representing growth of
17.9%. Turnover for the second quarter amounted to EUR 247.1
million (EUR 212.1 million), which represents an increase of
16.5%. Operating profit before taxes for the first half of the
year amounted to EUR 15.2 million (EUR 18.0 million). Second
quarter earnings totalled EUR 9.4 million, falling slightly below
that of the previous year (EUR 13.4 million). However, last year's
second quarter IFRS earnings included a one-off item of EUR 3.0
million of defined benefit plan pension income, which means that
this year's first-half business earnings actually reach the
previous year's level.
Atria's domestic business has been successful. Its sales in value
(wholesale business) increased by 9.7% during the first year-half,
whereas the total consumption of the product groups rose by 5.2%.
In June, Atria's supplier share including the subsidiary Liha ja
Säilyke Oy climbed to nearly 30% of the market, which represents
an increase of three percentage points over the beginning of the
year. In particular, packed meat, meat products and poultry sales
showed good development, partly thanks to successful novelties
launched within these product groups this summer. Atria's delivery
reliability has been good.
Liha ja Säilyke Oy showed good development in sales, earnings and
delivery reliability. The new logistic centre inaugurated earlier
this year is functioning excellently, enabling the company to
maintain a high-standard of customer service and positive sales
development in the future as well.
The Group's equity ratio fell to 46.3% from 47.9% - the previous
year's level for the corresponding period. This was influenced by
the increased receivables and ongoing investments.
The Group's personnel increased by some 650 employees and now
totals 4,300 employees. The increase is attributed to the addition
of A-Farmers Ltd, A-Rehu Oy and the Baltic companies to the
Groups statement figures.
Lithells AB
Lithells AB's sales for the first half of the year amounted to EUR
154.9 million (EUR 145.8 million), which represents an increase of
6.2%. The company's operating profit, however, went down to EUR
2.8 million from the previous year's 4.8 million. The main reason
for Lithells AB's earnings decrease was the drastic increase in
raw material prices that could not be correspondingly transferred
to sales prices. The same effect has been reflected in all of the
company's main competitors' weakened results. Within Lithells AB,
meat products and convenience food are manufactured by Atria
Lithells AB, whose earnings were also weakened as a result of this
trend. On the other hand, Atria Concept AB, which operates in the
fast food business and Svensk Snabbmat för Storkök AB conducting
local wholesales showed positive sales and earnings development.
UAB Vilniaus Mesa and AS Valga Lihatööstus
The business operations of UAB Vilniaus Mesa, operating in
Lithuania, have been adjusted to comply with Atria's goals.
Atria's long-term goal is to significantly increase its market
share from the current level of under 10%. The target market share
is 20-30%.
AS Valga Lihatööstus, operating in Estonia, joined the Group at
the beginning of the year. The entire production chain, from
primary production to consumers, is also being developed within
this company. The company is currently making significant
investments in order to expand its pork production.
The companies operating in the Baltic countries are relatively
small at the moment; their total annual turnover amounts to some
EUR 30 million. The business results of these companies do not as
yet have a significant impact on the consolidated result.
Russia
In June, Atria signed an agreement on the purchase of PIT Produkt,
the second largest company in the industry operating in St.
Petersburg. PIT Produkt is a strongly developing company with
solid profitability. The goal is to close the purchase during
August-September. If the arrangement is successful, PIT Produkt
will provide an opportunity for Atria to establish significant
business operations in Russia. In addition to St. Petersburg,
Atria aims to gradually enter the Moscow market. At the moment,
however, Atria is focused on taking over and further developing
PIT Produkt's business.
Investments
Atria Group plc is currently making extensive investments. The new
pig slaughtering line, which will be completed after year-end,
will enable significant rationing. The value of the investment is
EUR 21 million. Another ongoing project is a meat product and
convenience food factory expansion worth EUR 10.3 million.
The expansion of the Nurmo logistics centre, which will cost a
total of EUR 37 million, has begun, with the new centre being
inaugurated in spring 2007. At the moment, Atria delivers
approximately 500,000 kilograms of its products to wholesale and
catering customers daily. The aim of the logistics centre
expansion is to maintain good delivery capacity for increased
volumes and to continue meeting customer needs in the future as
well.
Future prospects
In total, Atria's turnover for the whole year will show strong
growth, as it did during the first half of the year. The positive
development of domestic business is estimated to continue. On the
other hand, Atria Lithells AB's earnings will remain below last
year's results. Atria's IFRS results for last year included a
total of EUR 8.1 million in one-off defined benefit plan pension
income; this year, there will be no such item. The consolidated
Group results will fall below last year's figures. However, the
Group is going through a period of very strong development both in
domestic and foreign business, and this is believed to create good
prerequisites for business development in the next few years.
ATRIA GROUP PLC
Seppo Paatelainen
Chief Executive Officer
DISTRIBUTION
Helsinki Stock Exchange
Principal media
www.atria.fi
Interim reports are mailed upon request and are available on our
Internet site, www.atria.fi.