INTERIM REPORT OF ATRIA PLC 1 JANUARY - 30 SEPTEMBER 2010
ATRIA PLC INTERIM REPORT 27 OCTOBER 2010 AT 08:00
INTERIM REPORT OF ATRIA PLC 1 JANUARY - 30 SEPTEMBER 2010
Atria has recorded impairment loss for goodwill in Russia and lowers the Group's
forecast for the remainder of the year
- Disputes in the spring relating to collective bargaining weighed down Atria
Finland's net sales and EBIT during the first half of the year. In Q3/2010,
Atria Finland's result development was positive.
- The rising prices of meat raw materials weakened Atria Russia's operative
EBIT.
- In Q3/2010, Atria recorded impairment loss of EUR 10.4 million for goodwill in
Russia.
- Atria Scandinavia's profitability in the first half of the year improved from
the previous year.
- The full-year EBIT and net sales of the Group in 2010 are expected to be below
the levels seen in 2009.
Atria Group:
Q3/ Q3/ Q1-Q3/ Q1-Q3/
EUR million 2010 2009 2010 2009 2009
---------------------------------------------------------------------------
Net sales 331.3 327.5 954.2 975.6 1,316.0
EBIT -0.4 16.9 5.3 23.6 27.5
EBIT % -0.1 5.2 0.6 2.4 2.1
Profit before taxes -3.0 14.4 -1.3 13.3 16.5
Earnings per share, EUR -0.22 0.35 -0.19 0.29 0.25
Review Q3/2010
Atria Group's net sales increased year-on-year by 1.2 per cent. In local
currencies, net sales fell by 2.3 per cent. The principal reason for the decline
in net sales is Atria Scandinavia's decreased net sales, which is mainly
explained by the discontinuation of consumer-packed meat production. In local
currencies, the Q3/2010 net sales of Atria Finland and Atria Russia grew
somewhat year-on-year.
The Group's EBIT for Q3/2010 was EUR -0.4 million. As a result of goodwill
impairment testing in Atria Russia, the company's Board of Directors decided
that Atria Russia will record impairments totalling EUR 10.4 million allocated
to goodwill. The impairments will have no effects on cash flow.
Atria Russia's Q3/2010 net sales came to EUR -15.4 million, which includes
goodwill impairment losses of EUR -10.4 million. Russia's weak performance was
also impacted by sluggish market demand, weakened margins, increased marketing
costs and, in particular, the sharp rise in the price of meat raw materials.
Atria Russia's EBIT also includes other non-recurring items relating to the
Campomos acquisition and a real estate in Moscow. The company reached a
agreement with the seller concerning the conditional purchase price for the
Campomos acquisition during the Q3/2010 period. The positive net effect of these
items was EUR 1.3 million.
Good sales of poultry products and strong cost efficiency raised Atria Finland's
EBIT to EUR 11.9 million. Atria Scandinavia's EBIT came to EUR 4.3 million and
Atria Baltic's operating loss to EUR 0.9 million.
The Group's net liabilities increased by EUR 8.6 million. This was mainly due to
an increased level of working capital and the strengthening of the Swedish
krona.
Atria Finland 1 January - 30 September 2010
Q3/ Q3/ Q1-Q3/ Q1-Q3/
EUR million 2010 2009 2010 2009 2009
---------------------------------------------------------------------------
Net sales 195.9 190.8 553.9 574.4 781.9
EBIT 11.9 13.9 22.9 31.7 42.9
EBIT % 6.1 7.3 4.1 5.5 5.5
Atria Finland's Q3/2010 net sales improved year-on-year by 2.7 per cent.
However, the net sales for the entire period January - September were down
year-on-year because of the disputes relating to collective bargaining in the
spring. During the summer season, Atria was particularly successful within the
poultry product group. Good preparation for the change in the fresh poultry
marketing directive and good product novelties boosted Atria's market share to
record heights. In other product groups, recovery from the labour dispute to
normal production levels will take longer. The market for Food Service products
is recovering from the recession, and sales took a turn for the better during
the period under review.
The Q3/2010 EBIT fell year-on-year by 14.4 per cent. The average price in the
product range was lower than in the previous year's comparison period. However,
cost efficiency has been good, resulting in good profitability.
The 10-day production break caused by the strike overloaded pig and bovine
slaughterhouses in the summer, and clearing this backlog increased the amount of
frozen stocks. The frozen stocks could not be cleared because of the record-high
amount of imported meat in the market.
The steep rise in the price of feed at the end of the period under review has
put heavy cost pressure on meat producers. The feed price is approximately 50
per cent higher than last year.
Atria Scandinavia 1 January - 30 September 2010
Q3/ Q3/ Q1-Q3/ Q1-Q3/
EUR million 2010 2009 2010 2009 2009
---------------------------------------------------------------------------
Net sales 98.9 104.4 293.6 306.4 405.2
EBIT 4.3 4.7 8.3 6.6 10.0
EBIT % 4.3 4.5 2.8 2.2 2.5
Atria Scandinavia's Q3/2010 net sales fell year-on-year by 5.3 per cent. In
local currency, the decrease was 12.9 per cent. The decline in the net sales is
mainly due to the discontinuation of consumer-packed meat production. During the
period under review, consumers' weakened purchasing power was particularly
evident in the sales of retail and Food Service products.
Despite the weakened sales, the Q3/2010 EBIT, excluding the non-recurring costs
of EUR 0.3 million resulting from the discontinuation of consumer-packed meat
production, came to EUR 4.6 million, which is at the same level as the Q3/2009
EBIT. EBIT for the first three quarters of the year excluding non-recurring
costs was EUR 10.6 million (EBIT % 3.6), which is better than in the previous
year's comparison period (EUR 9.5 million, EBIT % 3.1). The Swedish krona
strengthening against the euro has also had a positive impact on the company's
earnings development.
The efficiency improvement programme launched at the start of the year is
progressing according to plan. The Tyresö production plant located in the
Stockholm region has been closed down and production has been transferred to the
Skene plant. In addition, the production of delicatessen products in Gothenburg
has been transferred to Skene. The Gothenburg plant has been turned into a
delivery centre for delicatessen products. The production of consumer-packed
meat was discontinued, and the Årsta plant was closed down at the end of the
review period.
The market shares of Atria Scandinavia's brands have remained stable throughout
the first three quarters of the year.
Atria Russia 1 January - 30 September 2010
Q3/ Q3/ Q1-Q3/ Q1-Q3/
EUR million 2010 2009 2010 2009 2009
---------------------------------------------------------------------------
Net sales 33.7 28.7 97.0 83.1 113.0
EBIT -15.4 -0.5 -20.3 -9.4 -9.8
EBIT % -45.7 -1.7 -20.9 -11.3 -8.7
Atria Russia's net sales increased in Q3/2010 by 17.4 per cent year-on-year.
This was due to additional investments directed at sales both in St Petersburg
and Moscow. The growth was partly due to the strengthening of the Russian rouble
against the euro. In the local currency, net sales grew by 5.3 per cent
year-on-year.
The Q3/2010 EBIT showed a loss of EUR 15.4 million (Q3/2009 EUR -0.5 million).
During the review period, Atria Russia recorded impairments totalling EUR 10.4
million allocated to goodwill as a non-recurring item. The weak performance was
compounded by the sluggish market demand, weakened margins, increased marketing
costs and, in particular, the sharp rise in the prices of meat raw materials.
Atria Russia's EBIT also includes non-recurring items relating to the Campomos
acquisition and a real estate in Moscow. The company reached a agreement with
the seller concerning the conditional purchase price for the Campomos
acquisition during the Q3/2010 period. The positive net effect of these items
was EUR 1.3 million.
In the early part of the year, the market for meat product groups has declined
by about ten per cent (Source: Business Analytica).
Atria's market share in value increased in the St Petersburg area retail trade
over the period January-June 2010 to the level of about 20 per cent. Atria is
the clear market leader in St Petersburg (Source: Business Analytica). The
company's market share also strengthened in Moscow and was around four per cent
(Source: Atria's own estimate). The sales and marketing efforts related to
Campomos products, initiated in 2009, have continued as planned. The
year-on-year increase in marketing costs is about EUR 3 million compared to
2009, with the main emphasis on the last two quarters.
The prices of meat raw materials have increased sharply during Q3/2010 and the
price rises are expected to continue for the remainder of the year. The aim is
to transfer the rise of raw material prices to the prices of end products, which
may have a negative impact on net sales in the final quarter of the year.
Atria Baltic 1 January - 30 September 2010
Q3/ Q3/ Q1-Q3/ Q1-Q3/
EUR million 2010 2009 2010 2009 2009
---------------------------------------------------------------------------
Net sales 8.7 9.3 26.2 28.6 37.5
EBIT -0.9 -0.9 -3.0 -3.4 -12.6
EBIT % -10.3 -9.7 -11.5 -11.9 -33.6
Atria Baltic's Q3/2010 net sales fell slightly year-on-year. Atria's net sales
have decreased by 8.4 per cent from the start of the year. The overall Estonian
market for the product groups relevant to Atria has continued to decline during
the first three quarters of 2010. The overall Estonian market for cold cuts has
declined in value by about seven per cent during the first three quarters of the
year. The market for cooking sausages has declined by 11 per cent (Source: AC
Nielsen). In cold cuts, Atria's market share has remained around the 18 per cent
level in Estonia during the first three quarters. In grill sausages, Atria is
number one in the Estonian market with a market share exceeding 30 per cent
(Source: AC Nielsen). Atria's sales of consumer-packed meat have continued to
grow strongly during the first three quarters. Net sales have also been affected
by the company's decision to discontinue products with low profitability.
Atria Baltic's EBIT Q3/2010 remained at last year's level. The closing down of
the Ahja plant in the early part of the year, as well as other efficiency
improvement measures implemented, have improved the company's cost structure.
The price of animal feed in Estonia will raise the costs of Atria Baltic's pig
meat production during the remainder of the year.
Events occurring after the period
After the review period, Atria announced a revision of its strategy and related
changes in the management organisation. The key goals are a significant
improvement of the profitability of international operations, strengthening the
market position and organic growth. In its revised strategy, Atria Plc has
determined that Atria's long-term competitiveness will rely on product
leadership. Product leadership includes long-term strengthening of brands as
well as investments in product development and increased consumer knowledge.
Particular focus areas are Cold Cuts and the Atria Concept business.
As of 1 October 2010, changes were implemented in the job descriptions of Atria
Group Management members. The new organisation will have the following
Group-level functions and executive directors:
- Meat Raw Material Procurement and Atria Concept, Executive Vice President &
Deputy CEO Juha Gröhn
- Quality, Product Safety and Sustainability, Group Vice President Merja Leino
- Product Leadership, Group Vice President Jarmo Lindholm
- Strategy Process, Group Vice President Pasi Luostarinen
- Primary Production, Executive Vice President Juha Ruohola
- Procurement, Steering, Logistics and Information Management, Group Vice
President Jukka Mäntykivi
- Finance and Administration, Chief Financial Officer Tomas Back
Product Leadership and Strategy Process are entirely new Group functions.
Product Leadership comprises Group-wide brand management, R&D and product group
management functions. The Group Vice President in charge of the Strategy Process
is responsible for implementing and monitoring the process throughout the Group.
In October, Atria published the Atria's Handprint programme. Under this
programme, Atria will continue its work on corporate responsibility, which has
been going on for more than 100 years. Responsible operating methods and
transparency are key development priorities for the entire food industry. By
investing more systematically in developing responsible operating methods, Atria
aims to secure its current and future operating conditions. More information on
Atria's Handprint programme is available on our website: www.atriagroup.com
Kirsi Matero, M.Sc. (Econ.), was appointed as the Group Vice President of Human
Resources in Atria Plc, effective from 15 November 2010. Previously, Ms Matero
has worked as the HR Director of Pfizer Ltd. She will be a member of the Atria
Management Group and will report to the President and CEO, Matti Tikkakoski.
Investments
The Group's investments totalled EUR 7.1 million in Q3/2010 (EUR 5.0 million)
and EUR 34.2 million in the first three quarters (EUR 21.6 million).
Personnel
The Group had an average of 5,811 (5,840) employees during the period.
Personnel by business area:
Q1-Q3/2010 Q1-Q3/2009
Atria Finland 2,093 2,243
Atria Scandinavia 1,214 1,445
Atria Russia 2,025 1,992
Atria Baltic 479 633
Atria Plc announced the following changes in the Group management as of 1
September 2010. Atria Finland Ltd's Managing Director Juha Gröhn, M.Sc. (Food
Sc.) was appointed Managing Director, Atria Scandinavia AB. Mr Gröhn will
continue as Atria Plc's Executive Vice President and Deputy CEO. Furthermore, he
will be responsible for Meat Raw Material Procurement.
The President and CEO of Atria Plc, Matti Tikkakoski, M.Sc. (Econ.), was
appointed Atria Finland's Managing Director. He will continue as Atria Plc's
President and CEO.
Atria Plc's CFO Tomas Back, MSc (Econ.), was appointed Atria Baltic's Business
Area Director. He will also continue as Atria Plc's CFO.
Atria Plc's administration
Atria Plc's Board of Directors has the following membership: Chairman of the
Board Martti Selin, Vice Chairman of the Board Timo Komulainen, members Tuomo
Heikkilä, Esa Kaarto, Maisa Romanainen, Harri Sivula and Matti Tikkakoski.
Financing
In Q3/2010, Atria Plc refinanced four credit limits totalling EUR 190 million
with three new credit limits totalling EUR 150 million. The maturities of the
new committed credit limits are five years (EUR 100 million) and seven years
(EUR 50 million). In addition to these, a TyEl loan in the amount of EUR 14
million was drawn, with a maturity of eight years. These arrangements lengthen
the average maturity of the Group's loan portfolio and decrease the refinancing
risk of the loan portfolio. During the review period, Atria also concluded a new
interest rate swap. After these arrangements, the portion of the Group's loan
portfolio with fixed interest rates accounts for 39 per cent.
Short-term business risks
If the sluggishness in the meat product market continues in Russia, it will
weaken the demand for Atria's products in Atria customerships. In addition, the
steep rise in meat raw material prices in Russia will weaken the company's
prospects of profitability for the remainder of the year.
The price of animal feed raises the costs of meat production, which may weaken
the company's performance.
The export restrictions imposed by the Russian authorities on Finnish foods do
not have a significant impact on Atria's business. The share of Russian exports
in Atria Group's net sales is small.
Otherwise, no significant changes have occurred to Atria Group's short-term
business risks compared with the risks described in the 2009 financial
statements.
Outlook for the future
As a deviation from earlier guidance, the Group's EBIT in 2010 is predicted to
remain below the 2009 EBIT level. In addition, as a deviation from earlier
guidance, the Group's net sales in 2010 are predicted to fall somewhat below the
2009 level. Previously, Atria had estimated the Group's EBIT and net sales in
2010 to remain at the 2009 level.
If the sluggishness in the meat product market continues in Russia, it will
weaken the increase in Atria Russia's sales volumes. The prices of meat raw
materials have increased significantly in Russia during the period
August-September and the prices are expected to continue rising sharply for the
remainder of the year. The aim is to transfer the rise of raw material prices to
the prices of end products, which may have a negative impact on the Q4/2010 net
sales. In addition, the company's decision to discontinue production of
consumer-packed meat in Sweden will cut the Q4/2010 net sales. On the other
hand, the strengthening of the Russian rouble and Swedish krona has increased
the Group's euro-denominated net sales.
The main reasons for the weakening of the predicted EBIT are Atria Russia's
goodwill impairment loss and weakened prospects of results for the remainder of
the year. Atria Russia's full-year operating loss is expected to grow
significantly from last year. In addition to the difficult market situation,
this year's performance is burdened by the costs of the new plant and increased
investments in marketing. Atria Russia's euro-denominated loss is also increased
by the strengthened rate of the Russian rouble.
Board of Directors' valid authorisations for share issue and the granting of
special rights
The General Meeting authorised the Board of Directors to decide, on one or
several occasions, on an issue of a maximum of 12,800,000 new A shares or on any
A shares held by the company through a share issue and/or by granting option
rights or other special rights entitling people to shares as referred to in
Chapter 10, Section 1 of the Companies Act. The authorisation will be exercised
for the financing or execution of any acquisitions or other arrangements or
investments related to the company's business, for the implementation of the
company's incentive programme or for other purposes subject to the Board's
decision.
The Board is also authorised to decide on all terms and conditions of the share
issue and of the granting of special rights as referred to in Chapter 10,
Section 1 of the Companies Act. The authorisation thus also includes the right
to issue shares in a proportion other than that of the shareholders' current
shareholdings in the Company under the conditions provided by law, the right to
issue shares against payment or without charge and the right to decide on a
share issue without payment to the Company itself, subject to the provisions of
the Finnish Companies Act on the maximum number of treasury shares.
The authorisation shall supersede the share issue authorisation granted by the
Annual General Meeting on 29 April 2009 to the Board of Directors, and be valid
until the closing of the next Annual General Meeting. However, the authorisation
shall not be valid after 30 June 2011.
Purchase of treasury shares and valid authorisations
The General Meeting authorised the Board of Directors to decide, on one or
several occasions, on the acquisition of a maximum of 2,800,000 of the Company's
own Series A shares with funds belonging to the Company's unrestricted equity,
subject to the provisions of the Companies Act regarding the maximum number of
treasury shares to be held by a company. The Company's own Series A shares may
be acquired for use as consideration in any acquisitions or other arrangements
relating to the Company's business, to finance investments, as part of the
Company's incentive scheme, to develop the Company's capital structure, to be
otherwise further transferred, to be retained by the Company or to be cancelled.
The shares shall be acquired in a proportion other than that of the
shareholders' current shareholdings in the Company in public trading arranged by
NASDAQ OMX Helsinki Ltd at the trading market price of the moment of
acquisition. The shares shall be acquired and paid for in accordance with the
rules of NASDAQ OMX Helsinki Ltd and Euroclear Finland Oy. The Board of
Directors was authorised to decide on the acquisition of the Company's own
shares in all other respects.
The authorisation shall supersede the authorisation granted by the Annual
General Meeting on 29 April 2009 to the Board of Directors to decide on the
acquisition of the Company's own shares and shall be valid until the closing of
the next Annual General Meeting. However, the authorisation shall not be valid
after 30 June 2011.
KEY FIGURES
EUR 1-3/10 1-3/09 1-12/09
million
Equity per share (EUR) 15.41 15.38 15.39
Interest-bearing liabilities 449.2 441.1 425.8
Equity ratio (%) 40.1 39.9 39.7
Gearing (%) 102.4 101.1 97.5
Net gearing (%) 100.7 95.4 89.4
Gross investments in fixed assets 34.2 21.6 33.0
Gross investments, of net sales (%) 3.6 2.2 2.5
Average number of personnel 5,811 6,313 6,214
Accounting principles
This interim report was prepared in accordance with the IAS 34 Interim Financial
Reporting standard. In preparing this interim report, Atria has applied the same
principles as in preparing the 2009 annual financial statements. However, as of
January 2010, the Group has adopted the new and revised standards published by
the IASB that are included in the accounting principles for the 2009 annual
financial statements and have not had any material impact on the figures
presented for the period.
The principles and formulae for the calculation of key indicators have not
changed. They were presented in the 2009 annual financial statements. The
figures given in the interim report are unaudited.
ATRIA PLC
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Assets
EUR million 30-09-10 30-09-09 31-12-09
Non-current assets
Property, plant and
equipment 471.4 473.9 469.1
Goodwill 160.4 158.8 157.8
Other intangible assets 74.2 70.9 70.0
Investments in joint ventures
and associates 10.8 6.9 7.4
Other financial assets 2.3 2.3 2.3
Loans and other receivables 16.7 13.9 14.5
Deferred tax assets 9.8 5.6 6.7
Total 745.6 732.3 727.8
Current assets
Inventories 118.6 114.6 115.6
Trade and other receivables 214.4 212.8 212.6
Cash and cash equivalents 7.5 24.5 35.3
Total 340.5 351.9 363.5
Non-current assets held for sale 9.1 11.0 10.0
Total assets 1 095.2 1 095.2 1 101.3
Equity and liabilities
EUR million 30-09-10 30-09-09 31-12-09
Equity 438.6 436.7 436.9
Non-current liabilities
Interest-bearing financial
liabilities 330.2 314.0 318.9
Deferred tax liabilities 43.8 41.5 41.2
Other non-interest-bearing
liabilities 2.9 0.5 1.3
Total 376.9 356.0 361.4
Current liabilities
Interest-bearing financial
liabilities 119.0 127.1 106.9
Trade and other payables 160.7 175.4 196.1
Total 279.7 302.5 303.0
Total liabilities 656.6 658.5 664.4
Total equity and liabilities 1 095.2 1 095.2 1 101.3
CONSOLIDATED INCOME STATEMENT
EUR million 7-9/10 7-9/09 1-9/10 1-9/09 1-12/09
Net sales 331.3 327.5 954.2 975.6 1 316.0
Cost of goods sold -290.0 -280.4 -840.8 -854.0 -1 151.0
Gross profit 41.3 47.1 113.4 121.6 165.0
Sales and
marketing costs -21.6 -18.4 -61.9 -56.5 -77.7
Administration costs -11.0 -10.4 -35.7 -35.5 -47.7
Other income 4.1 1.0 6.3 3.0 4.6
Other expenses -13.2 -2.4 -16.8 -9.0 -16.7
EBIT -0.4 16.9 5.3 23.6 27.5
Finance income and costs -2.9 -2.8 -7.9 -11.2 -12.4
Share of the result of
associates 0.3 0.3 1.3 0.9 1.4
Profit before tax -3.0 14.4 -1.3 13.3 16.5
Income tax expense -2.8 -4.3 -3.1 -4.5 -9.1
Profit for the period -5.8 10.1 -4.4 8.8 7.4
Profit attributable to:
Owners of the parent -6.3 9.8 -5.4 8.2 7.0
Non-controlling interests 0.5 0.3 1.0 0.6 0.4
Total -5.8 10.1 -4.4 8.8 7.4
Basic earnings/
share, EUR -0.22 0.35 -0.19 0.29 0.25
Diluted earnings/
share, EUR -0.22 0.35 -0.19 0.29 0.25
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
EUR million 7-9/10 7-9/09 1-9/10 1-9/09 1-12/09
Profit for the period -5.8 10.1 -4.4 8.8 7.4
Other comprehensive income after tax:
Available-for-sale
financial assets -0.1 -0.1
Cash flow hedging 0.4 0.4 -1.4
Equity hedging -0.3
Translation
differences -7.9 4.2 12.8 -0.7 2.5
Total comprehensive income
for the period -13.3 14.2 8.8 8.0 8.2
Total comprehensive income attributable to:
Owners of the parent -14.0 13.9 7.6 7.4 7.8
Non-controlling interests 0.7 0.3 1.2 0.6 0.4
Total -13.3 14.2 8.8 8.0 8.2
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
EUR million Equity belonging to the shareholders of the Non- Equity
parent company cont total
roll
Share Share Other Inv. Own Trans Retain Total ing
ca premium reser non- shares lation ed inte
pit ves rest. diff. earn rests
al equity ings
fund
Equity
01-01-2009 48.1 138.5 0.1 110.3 -0.5 -33.5 170.5 433.5 1.4 434.9
Periods comprehensive
income -0.1 -0.7 8.2 7.4 0.6 8.0
Share-based
payment 0.2 0.2 0.2
Acquired treasure
shares -0.7 -0.7 -0.7
Distribution of
dividends -5.7 -5.7 -5.7
Equity
30-09-2009 48.1 138.5 0.0 110.5 -1.2 -34.2 173.0 434.7 2.0 436.7
Equity
01-01-2010 48.1 138.5 -1.7 110.6 -1.3 -31.0 171.9 435.1 1.8 436.9
Periods comprehensive
income 0.4 12.6 -5.4 7.6 1.2 8.8
Distribution of
dividends -7.1 -7.1 -7.1
Equity
30-09-2010 48.1 138.5 -1.3 110.6 -1.3 -18.4 159.4 435.6 3.0 438.6
CONSOLIDATED CASH FLOW STATEMENT
EUR million 1-9/10 1-9/09 1-12/09
Cash flow from operating activities
Operating activities 31.4 50.3 92.7
Financial items and taxes -26.9 -27.4 -31.0
Net cash flow from operating
activities 4.5 22.9 61.7
Cash flow from investing activities
Tangible and intangible assets -29.7 -20.2 -32.3
Investments -5.1 -1.6 -1.8
Net cash used in investing
activities -34.8 -21.8 -34.1
Cash flow from financing activities
Loans drawn down 40.8 30.4 41.8
Loans repaid -32.2 -37.8 -64.8
Dividends paid -7.1 -5.7 -5.7
Acquired treasury shares -0.7 -0.7
Net cash used in financing
activities 1.5 -13.8 -29.4
Change in liquid funds -28.8 -12.7 -1.8
OPERATING SEGMENTS
EUR million 7-9/10 7-9/09 1-9/10 1-9/09 1-12/09
Net sales
Finland 195.9 190.8 553.9 574.4 781.9
Scandinavia 98.9 104.4 293.6 306.4 405.2
Russia 33.7 28.7 97.0 83.1 113.0
Baltic 8.7 9.3 26.2 28.6 37.5
Eliminations -5.9 -5.7 -16.5 -16.9 -21.6
Total 331.3 327.5 954.2 975.6 1 316.0
EBIT
Finland 11.9 13.9 22.9 31.7 42.9
Scandinavia 4.3 4.7 8.3 6.6 10.0
Russia -15.4 -0.5 -20.3 -9.4 -9.8
Baltic -0.9 -0.9 -3.0 -3.4 -12.6
Unallocated -0.3 -0.3 -2.6 -1.9 -3.0
Total -0.4 16.9 5.3 23.6 27.5
ROCE *
Finland 8.6 % 10.1 % 10.2 %
Scandinavia 4.5 % 2.1 % 4.0 %
Russia -12.8 % -10.0 % -6.9 %
Baltic -30.3 % -8.1 % -26.5 %
Group 1.0 % 5.8 % 3.1 %
* ROCE % =
EBIT, 12mr / Capital employed, 12 mr avg *100
Investments
Finland 2.8 3.2 9.1 10.1 14.2
Scandinavia 1.9 0.9 6.3 2.9 5.3
Russia 2.3 0.8 18.4 7.4 11.9
Baltic 0.1 0.1 0.4 1.2 1.6
Total 7.1 5.0 34.2 21.6 33.0
Depreciations
Finland 7.3 7.3 22.0 22.4 29.7
Scandinavia 3.0 2.8 8.8 8.5 12.0
Russia 12.6 1.7 16.2 4.6 6.4
Baltic 0.7 0.6 2.2 2.4 10.5
Total 23.6 12.4 49.2 37.9 58.6
CONTINGENT LIABILITIES
EUR million 30-09-10 30-09-09 31-12-09
Debts with mortgages or other collateral
given as security
Loans from financial
institutions 5.8 6.1 6.0
Pension fund loans 4.8 4.2 4.2
Total 10.6 10.3 10.2
Mortgages and other securities given as
comprehensive security
Real estate
mortgages 6.6 7.0 6.7
Corporate mortgages 3.9 5.6 3.1
Total 10.5 12.6 9.8
Guarantee engagements not included
in the balance sheet
Guarantees 0.7 7.9 0.8
IMPAIRMENT TESTING: ATRIA RUSSIA
The recoverable amount of a cash-generating unit is defined on the basis of
value-in-use calculations. In these calculations, cash flow forecasts are used
for a period of five years that are based on budgets and other plans approved by
the management, defined before taxes. Cash flows that are realised after more
than five years are extrapolated using the growth rates presented below. The
applied growth rate shall not exceed the average long-term growth rate in the
industry of the cash-generating unit.
The key assumptions concerning cash flow forecasts used by Atria in impairment
testing are the growth of net sales and long-term profit margin. The growth and
profitability assumptions used are based on the company's net sales growth
percentages and profitability levels in the next few years.
Key assumptions: Atria Russia 2010 2009
Long-term growth rate 5.0% 5.0%
Discount rate defined before taxes 9.9% 10.0%
The prices of meat raw materials in Russia have risen significantly during the
period August-September. The price rises are expected to continue strong for the
remainder of the year, which further weakens Atria Russia's prospects of
results.
Impairment testing performed as a result of steep rise of meat raw material
prices, a decline in market demand and weakened margins lead to the company
recording goodwill impairment losses of EUR 10.4 million in Atria Russia.
USED EXCHANGE RATES
Average rates: Closing rates:
1-9/10 1-9/09 1-12/09 30-09-10 30-09-09 31-12-09
SEK 9.6015 10.6622 10.5875 9.1421 10.2320 10.2520
DKK 7.4456 7.4473 7.4461 7.4519 7.4443 7.4418
RUR 39.7927 44.6069 44.3005 41.6923 43.9800 43.1540
EEK 15.6466 15.6466 15.6466 15.6466 15.6466 15.6466
LTL 3.4528 3.4528 3.4528 3.4528 3.4528 3.4528
PLN 4.0036 4.4082 4.3469 3.9847 4.2295 4.1045
NOK 7.9953 8.7852 8.6892 7.9680 8.4600 8.3000
ATRIA PLC
Board of Directors
For further information, please contact Matti Tikkakoski, President and CEO,
tel. +358 50 2582.
DISTRIBUTION
Nasdaq OMX Helsinki Ltd
Major media
www.atriagroup.com
The Interim Report will be mailed to you upon request and is also available on
our website at www.atriagroup.com
