Interim report of Atria Plc 1 January - 30 June 2012

Atria Plc Company Announcement 26 July  2012 at 8.00 am

*Extraordinary items are included in the reported figures.

Review Q2/2012

Atria Group’s net sales for Q2/2012 totalled EUR 333.3 million (EUR 333.6 million), down by EUR -0.3 million compared to the corresponding period last year. EBIT improved by EUR 6.6 million year-on-year, amounting to EUR 5.7 million (EUR -0.9 million). The results for the comparative period include net EUR 0.6 million of non-recurring profit.

Atria Finland’s Q2/2012 net sales totalled EUR 204.6 million (EUR 203.0 million), showing growth of EUR 1.6 million year-on-year. The EUR 7.8 million EBIT (EUR 2.6 million) was EUR 5.2 million higher than the EBIT for the corresponding period last year. This increase was due to an improved sales structure, implemented efficiency improvement measures and higher sales prices.

Atria Scandinavia's Q2/2012 net sales totalled EUR 95.0 million (EUR 95.8 million), representing a fall of EUR 0.8 million year-on-year. In the local currency, net sales decreased by 1.7 per cent year-on-year. Increase in the raw material costs weighed down EBIT to EUR 1.8 million (EUR 2.7 million), which is EUR 0.9 million lower than in the comparative period.

Atria Russia’s Q2/2012 net sales amounted to EUR 31.3 million (EUR 32.5 million). In the local currency, net sales decreased by 3.5 per cent year-on-year. EBIT was EUR -2.0 million (EUR -5.6 million), showing an improvement of EUR 3.6 million over the comparative period. This increase was due to implemented efficiency improvement measures and the raising of sales prices.

Atria Baltic's Q2/2012 net sales amounted to EUR 9.1 million (EUR 9.1 million). EBIT was EUR -0.4 million (EUR 0.2 million), which is EUR 0.6 million weaker than in the same period last year. The results for the comparative period contain EUR 0.6 million of non-recurring profit.

Atria revamped its strategy during the review period. The new strategy focuses on strengthening core business and improving its profitability in all business areas. The aim is to improve Atria's position especially in cold cuts and other meat products in all business areas. This requires the revising of category management, improvement of productivity and strengthening of customer focus throughout the Group.

Olle Horm was appointed Executive Vice President of Atria Baltic and a member of Atria Group’s Management Team. He will assume his position by 15 August 2012 and report to Juha Gröhn, CEO, Atria Plc. Atria Baltic’s current Executive Vice President, Rauno Väisänen, will return to Atria Finland.

Review H1/2012

Atria Group’s net sales for H1/2012 totalled EUR 641.8 million (EUR 637.6 million), showing growth of EUR 4.2 million compared to the corresponding period last year. EBIT improved by EUR 11.0 million year-on-year, amounting to EUR 5.8 million (EUR -5.2 million). The results for the comparative period include net EUR 0.1 million of non-recurring profit.

Atria Finland’s H1/2012 net sales totalled EUR 393.0 million (EUR 389.3 million), up by EUR 3.7 million year-on-year. The EUR 13.0 million EBIT (EUR 3.2 million) was EUR 9.8 million higher than the EBIT for the corresponding period last year. This increase was due to an improved sales structure, implemented efficiency improvement measures and higher sales prices.

Atria Scandinavia's H1/2012 net sales totalled EUR 184.5 million (EUR 183.6 million), representing an increase of EUR 0.9 million year-on-year. In the local currency, net sales were at the same level as last year. Increase in the raw material costs weighed down EBIT to EUR 1.9 million (EUR 5.0 million), which is EUR 3.1 million lower than in the comparative period.

Atria Russia’s H1/2012 net sales amounted to EUR 59.6 million (EUR 60.8 million). In the local currency, net sales decreased by 3.0 per cent year-on-year. EBIT was EUR -5.3 million (EUR -11.1 million), showing an improvement of EUR 5.8 million over the comparative period. This increase was due to implemented efficiency improvement measures, price increases and the streamlining of the product range.

Atria Baltic’s H1/2012 net sales totalled EUR 17.0 million (EUR 17.3 million), representing a fall of EUR 0.3 million year-on-year. EBIT was EUR -0.9 million (EUR 0.0 million), which is EUR 0.9 million weaker than in the same period last year. The results for the comparative period contain EUR 0.9 million of non-recurring profit. The slow development was caused by the increase in raw material prices, which could not be fully transferred to sales prices.

Due to an increase in investments, the Group’s free cash flow during the review period (operating cash flow – cash flow from investments) was EUR -9.6 million (EUR -8.7 million). Interest-bearing net liabilities came to EUR 419.8 million, showing an increase of EUR 17.0 million since the turn of the year.

During the review period, a programme was launched to improve the profitability of Atria Scandinavia’s production of meat products. Atria is investing approximately EUR 4.7 million in new production equipment for the Malmö plant. The manufacture of ham products and the slicing of cold cuts will be transferred from the Halmstad plant to the Malmö plant. The Halmstad plant will be closed down after the production transfer. The programme is expected to generate annual cost savings of approximately EUR 1.5 million. The savings will begin to materialise in 2012 and will be fully effective from the beginning of 2013.

During the review period, Atria Russia launched a programme aimed at improving production efficiency at the Sinyavino and Gorelovo plants. These measures are expected to generate annual cost savings of around EUR 2.0 million, which will be fully realised from the beginning of 2013. Meat products are now produced at the centralised Sinyavino and Gorelovo plants in St Petersburg.

Atria Plc’s Board of Directors decided to terminate the share incentive plan for Atria Group's key personnel and replace it with a new long-term reward programme. The share incentive plan will no longer be applied in 2012.

Outlook for the future

The Group’s EBIT was EUR 8.0 million in 2011. A considerably higher EBIT is anticipated for 2012. Some growth in net sales is expected for 2012.

Publication procedure

Atria Plc complies with the publication procedure in accordance with standard 5.2b of the Financial Supervisory Authority and publishes its 1 JANUARY – 30 JUNE 2012 interim report release as an attachment to this company announcement. The full interim report is available on the company’s website at www.atriagroup.com.

For more information, please contact Juha Gröhn, CEO, Atria Plc, tel. +358 400 684 224.

Invitation to a press conference

A press conference conducted in Finnish will be arranged today 26 July 2012 at 10:00 am at Atria offices in Helsinki, address Läkkisepäntie 23, Helsinki. The presentation material will be available on the company’s website (www.atriagroup.com/en/investors/FinancialInformation/quarterlyreports) after the distribution of the interim report and as an attachment to this company announcement.


ATRIA PLC
Board of Directors


DISTRIBUTION
Nasdaq OMX Helsinki Ltd
Major media
www.atriagroup.com