ELISA?S PRE-TAX PROFIT AMOUNTED TO EUR 39 MILLION
ELISA CORPORATION STOCK EXCHANGE RELEASE ON 28 APRIL 2005 AT 8.30am
ELISAS PRE-TAX PROFIT AMOUNTED TO EUR 39 MILLION
· The January-March pre-tax profit amounted to EUR 39 million
(56). Revenue was EUR 333 million (333).
· Compared to the previous quarter, Elisas number of
subscriptions in mobile communications, exclusive of MVNO
subscriptions, rose by approximately 55 000 subscriptions and the
churn decreased from 39 to 34 per cent.
· The sales of broadband subscriptions continued robustly; the
number of broadband subscriptions increased by approximately
47 000 from the beginning of the year
· The financial position remained stable: at the end of March,
equity ratio was 49 per cent (49 per cent at the end of 2004) and
net debt was EUR 489 million (462 million at the end of 2004)
In January-March, Elisas key figures were:
Income statement Q1/2005 Q1/2004 1-12/2004
EUR million
Revenue 333 333 1 356
EBITDA 97* 120** 455***
EBIT 45 67 242
Profit before taxes 39 56 212
Earnings per share, EUR 0.23 0.28 1.10
CAPEX 42 44 181
* Includes the EUR 8 million capital gain on the divestment of
Yomi Software Ltd
** Includes capital gains and received settlement total EUR 5m
*** Includes in addition to previous capital gain on old
headquarters and change in calculating principles of the
pension provision total EUR 23m
Figures describing the financial position and cash flow:
Financial position 31 Mar 31 Mar 31 Dec
2005 2004 2004
Net debt 489 660 462
Equity ratio, % 49 41 49
Cash flow statement Q1/2005 Q1/2004 1-12/2004
Cash flow after 26 9 225
investments
CEO Veli-Matti Mattila:
The number of Elisas subscriptions soared
Elisa did well in the competition in early 2005. The increase in
the number of mobile subscriptions by 55 000 and broadband
subscriptions by 47 000 is significant in the ongoing fierce
competition. Our market position strengthened more than expected
both in the mobile communication and broadband market. This
generated more expenses than anticipated.
We expect the competition to remain tight. We will put further
emphasis on strengthening our market position. This may erode
profitability in the short term. Therefore, we have set extra
targets to streamline operations and improve profitability.
Third-generation mobile communication services are taking their
first steps. The Ministry of Transport and Communications has been
pondering whether ending the ban on bundling of 3G subscriptions and
handsets is the right move to promote the new generation market.
In Elisas opinion, the ban on bundling could be lifted entirely and
immediately from GSM subscriptions and handsets as well.
As of the beginning of 2005, Elisa Corporation shifted from
Finnish Accounting Standards (FAS) to International Financial
Reporting Standards (IFRS). The first interim report for the year
2005 has been prepared in accordance with IAS 34 regulations. On 8
April 2005, Elisa issued a stock exchange release which included
the reconciliation of equity and result for the date of transition
to IFRS, and principal comparative IFRS figures for 2004.
Information in this interim report is not audited.
ELISA CORPORATION
Velipekka Nummikoski
Vice President, Corporate Communication
Further information:
Mr Veli-Matti Mattila, President and CEO, tel. +358 10 262 2635
Ms Tuija Soanjärvi, CFO, tel. +358 10 262 2606
Mr Vesa Sahivirta, IR Director, tel. +358 10 262 3036
Distribution:
Helsinki Stock Exchange
Major media
Interim report for January-March 2005
Market situation
The competitive situation remained fierce. Elisa invested heavily
in sales and continued extensive marketing. The number of Elisas
own mobile subscriptions and those of service operators in Elisas
network has developed favourably. Prices for the average call
minute rate of the mobile communication business continued to fall
and usage of subscriptions increased. The robust demand for
broadband subscriptions in the fixed network market prevailed,
whereas the number and use of traditional subscriptions decreased.
Revenue
EUR million Q1/2005 Q1/2004 Change
Mobile communications 179 179 0%
Fixed network 162 164 -1%
Other businesses 21 23 -9%
Sales between segments -29 -33 -12%
Total 333 333 0%
Elisas revenue for January-March remained at the same level as
the corresponding period in 2004.The revenue in the mobile
business was affected by the lower interconnection fees and the
fall in consumer prices, which was offset by the increased usage
of subscriptions. Revenue for the fixed network business remained
at the previous years Q1 level.
Performance
EUR million Q1/2005 Q1/2004 Change
Mobile communications
EBITDA 49 64 -23%
EBITDA, % 27% 36%
EBIT 27 42 -36%
Fixed network
EBITDA 40 55 -27%
EBITDA, % 25% 34%
EBIT 13 27 -52%
Other businesses and
corporate functions
EBITDA 8 1
EBIT 5 -3
Group, total
EBITDA 97* 120** -19%
EBITDA, % 29% 36%
EBIT 45 67 -33%
* Includes the EUR 8 million capital gain on the divestment of
Yomi Software Ltd
** Includes capital gains and received settlement total EUR 5m
Elisas EBITDA decreased by 19 per cent over the previous year.
Reduced EBITDA was affected by the fall in prices of mobile
communications and decreased volumes in the fixed network
business. In addition, EBITDA was eroded by sales costs relating
to the enhanced number of subscriptions in mobile and broadband
subscriptions.
Elisa revised its operational model, and has set objectives to
improve profitability for the years 2006 and 2007.
EBITDA included a EUR 8 million capital gain on the divestment of
Yomi Software Ltd. The contributions to the Elisa Pension Fund
were at a lower level than in the corresponding period last year.
The group's other financial income and expenses totalled EUR -6
million (-10). Reduced financial expenses were mainly due to the
decreased net debt.
Income taxes in the income statement amounted to EUR -6 million (-
17). The tax base in Finland was altered from 29 to 26 per cent at
the beginning of 2005.
The group's January-March result after taxes was EUR 33 million
(40). The group's earnings per share (EPS) amounted to EUR 0.23
(0.28). At the end of March, the group shareholders' equity per
share stood at EUR 6.07 (6.23 at the end of 2004).
Changes in corporate structure
Elisa sold the entire share capital of Yomi Software Ltd, a 100
per cent subsidiary of Elisa, to Sysopen Digia Plc. The selling
price was EUR 12.1 million, and Elisa was also released from a EUR
1.5 million debt liability. The sale forms part of Elisas
restructuring programme and releases capital tied up in business
defined as Elisa's non-core business. Yomi Software is
consolidated in Elisa until the end of March.
Elisa will transfer its personnels statutory pension coverage to
Varma Mutual Pension Insurance Company, and the supplementary
pensions to Sampo Life Insurance Company Ltd as of 1 July 2005. At
the same time, Elisa's Pension Fund will transfer its statutory
pension liabilities and assets to Varma and supplementary pension
liabilities and assets to Sampo Life.
In January, Elisa and IBM signed a letter of intent to allocate
Elisa's application management services to IBM. According to the
agreement, the employees responsible for the development and
maintenance of Elisa's information systems will join IBM, and the
responsibility for administering Elisa's present providers of
application management will be assigned to IBM. The seven-year
agreement came into force on 1 April 2005. On the same date, 150
Elisa employees joined IBM as established employees.
The merger of Liedon Puhelin Ltd into Lounet Ltd was entered in
the Trade Register on 31 March 2005. Elisa previously owned 16.8
per cent of Liedon Puhelin. After this corporate arrangement,
Elisas holding in Lounet decreased from 50.2 per cent to 46.7 per
cent. Lounet is consolidated in Elisa as a group company.
The merger of Kestel Ltd and Kesnet Ltd into Elisa was recorded in
the Trade Register on 31 March 2005.
Mobile business
Q1/2005 Q1/2004 2004
Number of subscriptions,
Finland* 1 438 452 1 319 007 1 383 515
Number of subscriptions,
Estonia 235 650 173 550 225 500
Revenue/subscription**(ARPU), 34.6 38.6 37.8
Churn**, % 33.5 47.4 33.7
Usage, million minutes* 714 596 2 498
Usage, min./subscription/mth** 158 150 156
SMS, million msg* 162 121 537
SMS, msg/subscription/mth** 36 31 34
Value-added services/revenue, 15 13 14
%
* Elisas network operator in Finland, exclusive of MVNO
subscriptions
** Elisas service operator
In Q1, the number of subscriptions of Elisas network operator in
Finland rose by 54 937. The number of subscriptions of Elisas own
service operator increased by approximately 68 000 subscriptions.
The number of other service operators subscriptions decreased by
approximately 13 000. The reduction was mainly due to the
abandoning of old prepaid subscriptions. The numbers do not
include MVNO (Mobile Virtual Network Operators) subscriptions.
The call minutes per subscription of Elisas own service operator
rose by around 5 per cent, and the number of SMS messages
increased by approximately 16 per cent over the previous year. The
call minutes of the network operator rose by around 20 per cent
and SMS messages by 34 per cent. The increased volume of the
network operator was substantially affected by additional traffic
generated by MVNOs.
Revenue per subscription (ARPU) decreased by approximately 10 per
cent over the last year. This was mainly due to a fall in
interconnection fees and consumer prices.
The business operations of Elisas subsidiary in Estonia continued
favourably. Revenue was EUR 19.0 million (15.4), EBITDA EUR 5.8
million (4.5) and EBIT EUR 3.5 million (2.3). At the end of March,
there were 235 650 mobile subscriptions (173 550).
Elisa, Digita, MTV, Nelonen, Nokia, Sonera and YLE (The Finnish
Broadcasting Company) started a mobile TV pilot in Finland in
March. The companies are testing the viewing and receiving of TV
programmes on mobile phones. In addition, the use of mobile TV
services and consumers user experiences are being surveyed.
Elisa developed two interactive services for mobile TV: IndicaTV
and SnadiTV. These services enable companies, organisations and
private individuals to provide content to TV channels. The
programmes may be followed on smart phones equipped with a special
accessory to receive mobile TV broadcasts.
Fixed network business
Number of subscriptions 31.3.2005 31.3.2004 31.12.2004
Broadband subscriptions 269 232 148 270 222 307
ISDN channels 149 339 190 921 159 591
Cable TV subscriptions 200 864 186 097 198 447
Analogue and other
subscriptions 626 740 669 192 640 072
Subscriptions, total 1 246 175 1 194 480 1 220 417
Brisk demand for broadband subscriptions continued in the first
quarter. From the beginning of the year, the number of broadband
subscriptions increased by 46 925. The annual growth was 120 962
subscriptions, equalling 82 per cent. The number of traditional
subscriptions continued its steady decrease, as voice is shifting
to the mobile network and data to broadband subscriptions. Elisa
increased the availability of broadband connections in Northern
Finland to 19 new municipalities.
At the beginning of March, the pricing principles of calling from
a fixed network to mobile phones changed. This enabled more
inexpensive calls from a fixed network to mobile phones for end-
customers. The marketing and launching of Elisa Mobile Dial call
agreements took place as planned.
If P&C Insurance Company Ltd appointed Elisa and Telenor to
provide all of its communications services in the Nordic region.
In Finland, the service provider is Elisa. This most important
cooperative service agreement in the Nordic communications market
provides seamless integration of the four Nordic countries and two
telecommunications companies. The comprehensive service delivery
agreement with If is built on a long-standing strategic
partnership between Elisa and Telenor.
Elisas Annual General Meeting on 14 March 2005
In accordance with the proposal of the Board of Directors, Elisas
Annual General Meeting decided to pay a dividend of EUR 0.40 per
share for 2004. The dividend approved by the Annual General
Meeting was paid to shareholders listed in the companys
shareholders register maintained by the Finnish Central Securities
Depositary Ltd on 17 March 2005.
The number of the members of the Board of Directors was confirmed
at six (6), and the following members were re-elected for a one-
year term ending at the close of the next General Meeting: Keijo
Suila, Ossi Virolainen, Matti Aura, Pekka Ketonen, Mika Ihamuotila
and Jussi Länsiö.
The Board of Directors, elected at the Annual General Meeting,
held its organizing meeting on 14 March 2005. President and CEO
Keijo Suila was re-elected as Chairman of the Board and Ossi
Virolainen continues as the Deputy Chairman. Keijo Suila
(Chairman), Mika Ihamuotila and Pekka Ketonen were appointed to
the Committee for Remuneration Evaluation and Appointments. Ossi
Virolainen (Chairman), Matti Aura and Jussi Länsiö were appointed
to the Committee for Auditing.
KPMG Oy Ab, authorised public accountants, with APA Pekka Pajamo
as the responsible auditor, was appointed the company's external
auditor.
The Annual General Meeting authorised the Board of Directors to
decide on increasing the company's share capital. The
authorisation is valid for a year, and the aggregate number of new
shares subscribed pursuant to the authorisation may total 28.3
million at the maximum.
The Annual General Meeting authorised the Board of Directors to
acquire and assign treasury shares. The authorisation is valid for
one year, and applies to a maximum of 6 888 000 treasury shares.
In accordance with Chapter 3a, Article 3a of the Finnish Companies
Act, the Annual General Meeting approved the proposal of the Board
of Directors to sell the shares in the joint book-entry account.
Personnel
During January-March, the average number of people at Elisa was
5 426 (an average of 5 590 in 2004).
31 Mar 2005 31 Mar 2004 31 Dec 2004
Mobile communications 1 604 1 545 1 477
Fixed network 2 924 3 456 3 015
Other businesses 604 902 814
Corporate functions 73 79 70
Total 5 205 5 982 5 376
The number of personnel as of 31 March 2005 does not include the
Yomi Software staff of 258 people. The figures include the 150
people who joined IBM on 1 April 2005 when the application
management was outsourced.
Investments
EUR million 1-3/2005 1-3/2004 1-12/2004
Capital expenditures 42 44 181
- Mobile business 13 8 68
- GSM leasing liability buy-backs 4 19 20
- Fixed network business 24 16 88
- Others 1 1 5
Shares 3 0 61
Total 45 44 242
Shifting to IFRS
In early 2005, Elisa shifted from Finnish Accounting Standards
(FAS) to International Financial Reporting Standards (IFRS) in its
consolidated reporting.
Elisa uses the exemptions allowed by the IFRS 1 standard for the
retrospective application of single standards. The most
significant exemption concerned business combinations carried out
before the transition date. These acquisitions of subsidiaries and
associates are consolidated at original cost or consolidation
method. The IFRS 3 standard is applied to acquisitions subsequent
to 1 January 2004. Impairment tests have been performed, and no
impairments are recorded in the balance sheet of the transition
date nor are impairments booked in the balance sheet of the
subsequently terminated financial period.
An exemption is used for pensions classified as defined benefit
plans. According to this, the IAS 19 standard is not applied
retrospectively, but at the date of transition, the liability of
defined benefit plans are recognised in the opening balance sheet
and at fair value valid at the time.
Revaluations of non-current assets were reversed. After the
adjustment, the groups total non-current assets are based on
original acquisition costs.
Assets leased through finance lease agreements less accumulated
depreciation are booked under property, plant and equipment; and
correspondingly, liabilities from the agreement are recognised as
interest-bearing liabilities. Leases generated by finance lease
agreements have been replaced by entries in financial expenses and
repayment of debt. The interests of the finance lease agreements
do not have a significant impact on financial income and expenses.
Financial position
Elisas financial position and liquidity remained stable. This was
particularly affected by the positive performance. The groups
January-March cash flow after investments amounted to EUR 32
million (36). The dividends for the financial period of 2004 were
paid out starting on 24 March 2005. The total amount of dividends
was EUR 56.8 million. In addition, the subsidiary Comptel paid EUR
3.6 million in dividends to others outside the parent company.
Financial key indicators
EUR million 31 Mar 31 Mar 31 Dec
2005 2004 2004
Net debt 489 660 462
Gearing, % 55.0 87.4 50.6
Equity ratio, % 49.3 40.9 49.3
Q1/2005 Q1/2004 1-12/2004
Cash flow after investments 26 9 225
Valid finance arrangements
EUR million Maximum amount Use on 31 March2005 2005
Committed credit line 170 0
Commercial paper programme 1) 150 0
EMTN programme 2) 1 000 477
1) The programme is not committed
2) European Medium Term Note programme, not committed
Ratings per long-term loans
Credit rating agency Rating Outlook
Moodys Investor Services Baa2 Stable
Standard & Poors BBB Stable
Share
At the end of March, the company's total number of shares was
141 989 109. The market capitalisation on 31 March 2005 stood at
EUR 1 857 million.
In January-March, a total of 40.3 million shares of the company
were traded on the Helsinki Stock Exchange for an aggregate of
EUR 514.3 million. The exchange was 28.4 per cent of the number
of shares in the market.
The number of Elisas A warrants for the year 2004 was 3 600 000
and B warrants for the year 2004 was 3 600 000. At the end of
March, the market capitalisation of the warrants amounted to
EUR 0.3 million.
Treasury shares
The Annual General Meeting authorised the Board of Directors to
acquire and assign treasury shares. The authorisation has not
been used.
Shares 31 Mar 31 Mar 31 Dec
2005 2004 2004
Treasury shares owned by Elisa Corp. 0 0 0
Elisa shares owned by
subsidiaries 210 672 781 563 210 672
Treasury shares, total 210 672 781 563 210 672
% of share capital and votes 0.15% 0.57% 0.15%
Shares owned by
Elisa Pension Fund 202 263 267 363 202 263
% of share capital and votes 0.14% 0.19% 0.14%
Major legal issues
The following changes have taken place in the legal processes
after the publication of Elisa's annual report for 2004:
Elisa Matkapuhelinpalvelut Ltd submitted a claim for restitution
and damages to Helsinki District Court regarding TeliaSonera
Finland's and Sonera Mobile Networks mobile communication
interconnection fees. The claim applies to the period from 1
January 1997 to 31 August 2001. Elisa is demanding a total of
EUR 300 million, of which the share of the exorbitant price is
EUR 116.3 million and the rest is interest charges and compensation
for damage. TeliaSonera Finland and Sonera Mobile Networks have
informed Elisa Matkapuhelinpalvelut Ltd of a request to initiate
arbitration proceedings.
The main hearing of the action for annulment regarding the
Radiolinja shareholders meeting in spring 2000 has taken place in
Helsinki District Court. A ruling on the matter will be issued on
29 April 2005.
Estates of bankruptcies of Euroapaja Ltd and Euro-Tele Ltd have
brought action against Elisa Matkapuhelinpalvelut Ltd by claiming
a total of approximately EUR 1.7 million in compensation and
interest regarding alleged unpaid subscription fees and marketing
compensation in the mid 1990s. Elisa asserts the action is
unfounded.
Events after the financial period
In the redemption proceeding regarding the merger of Yomi Plc,
pursuant to Chapter 14 Section 12 of the Finnish Companies Act,
the arbitration court set the redemption price at EUR 7.30 per
share on 7 April 2005. The redemption concerns 636 294 former
shares of Yomi Plc. The parties are entitled to submit an appeal
against the decision to the district court within two months.
Kolumbus launched a new international call service as of early
April. The new 99559-prefixed international call functions in all
fixed and mobile subscriptions.
At the beginning of April, Elisa and Kapiteeli Plc signed an
agreement whereby Elisa sold office and telecom premises plus
office and commercial premises in Tampere to Kapiteeli. Elisas
former office and telecom premises in Helsinki are also included
in the transaction. The selling price totalled EUR 19.2 million,
of which EUR 8 million is booked as capital gain. The transaction
will be booked during the second quarter of 2005.
Elisa revised its operational model to increase customer
orientation and effectiveness, in line with its strategic
selections. Accordingly, the tasks and responsibilities of the
members in Elisas Executive Board will be reorganised. The
changes will take effect on 2 May 2005.
Elisa will introduce a Vodafone Push Email service which will make
sending and receiving email with a mobile phone easier. The
service allows the user to automatically and securely transfer
emails to a mobile phone.
Outlook for 2005
The competition in the telecommunications market in Finland will
continue to be tight. Usage of both the mobile and fixed network
products will increase. Elisa aims to strengthen its market
position.
The comparable revenue for 2005 is estimated to decrease slightly
from the previous year owing to the new interconnection billing
and a fall in prices. Due to the implemented and ongoing revamping
of operations, the companys competitive edge will continue to
improve and profitability will remain good.
The comparable EBITDA and EBIT for the second quarter of the year
are estimated to remain at the same level as in the first quarter
of 2005. The disposal of non-core assets and corporate
restructuring will have a positive effect on the earnings per
share.
The annual capital expenditures will amount to 13 per cent of the
revenue at most, and the cash flow will continue to be clearly
positive.
BOARD OF DIRECTORS
Figures are not audited
CONSOLIDATED INCOME STATEMENT
EUR million
1-3 1-3 1-12
2005 2004 2004
Revenue 332,9 332,7 1356,0
Other operating income 11,2 6,6 27,0
Operating expenses -247,0 -219,5 -928,2
EBITDA 97,1 119,8 454,8
Depreciation and amortisation -52,4 -53,2 -213,2
EBIT 44,7 66,6 241,6
Share of associated companies' profit 0,7 0,0 1,3
Financial income and expenses -6,5 -10,3 -30,4
Profit before tax 38,9 56,3 212,5
Income taxes -5,9 -16,7 -53,2
Profit for the period 33,0 39,6 159,3
Attributable to:
Equity holders of the parent 32,1 38,4 151,7
Minority interest 0,9 1,2 7,6
Profit for the period 33,0 39,6 159,3
Earnings per share (EUR)
Basic 0,23 0,28 1,10
Diluted 0,23 0,28 1,10
Average number of outstanding
shares (1000 shares)
Basic 141778 137230 137570
Diluted 141778 137230 137570
REVENUE BY BUSINESS SEGMENTS
EUR million
1-3 1-3 1-12
2005 2004 2004
Mobile 179,0 179,2 712,8
Fixed Network 161,5 164,3 653,6
Other Companies
Comptel 14,5 12,5 59,7
Other Companies 6,4 10,1 48,7
Unallocated 2,4
Intra-segment sales elimination -28,5 -33,4 -121,2
Corporation total 332,9 332,7 1356,0
EBITDA BY BUSINESS SEGMENTS
EUR million
1-3 1-3 1-12
2005 2004 2004
Mobile 49,2 63,7 227,0
Fixed Network 39,6 55,4 200,7
Other Companies
Comptel 3,2 3,4 18,3
Other Companies 7,2 -0,4 2,0
Unallocated -2,1 -2,3 6,8
Corporation total 97,1 119,8 454,8
EBIT BY BUSINESS SEGMENTS
EUR million
1-3 1-3 1-12
2005 2004 2004
Mobile 26,7 42,2 138,1
Fixed Network 13,3 27,2 91,1
Other Companies
Comptel 2,3 2,6 14,8
Other Companies 4,4 -1,6 -4,6
Unallocated -2,0 -3,8 2,2
Corporation total 44,7 66,6 241,6
CONSOLIDATED BALANCE SHEET
EUR million
31.3. 31.3. 31.12.
2005 2004 2004
Non-current assets
Intangible assets 76,4 48,2 75,8
Consolidated goodwill 465,2 456,7 466,2
Tangible assets 706,9 776,9 724,2
Investments in associated companies 12,4 12,5 11,7
Other investments 9,8 8,1 10,4
Deferred tax receivable 42,3 129,3 42,5
Other receivables 50,4 41,3 46,5
1363,4 1473,0 1377,3
Current assets
Inventories 14,9 13,7 15,1
Trade and other receivables 328,7 374,8 308,5
Cash and cash equivalents 114,7 67,8 162,8
458,3 456,3 486,4
Total assets 1821,7 1929,3 1863,7
Capital and reserves attributable
to equity holders of parent 860,6 712,8 883,5
Minority interest 28,9 71,4 31,0
Total equity 889,5 784,2 914,5
Non-current liabilities
Deferred tax liabilities 29,7 36,3 29,8
Provisions 24,0 31,0 21,4
Interest-bearing debt 468,8 608,9 593,4
Other non-current liabilities 9,9 7,2 10,3
532,4 683,4 654,9
Current liabilities
Provisions 1,1 14,3 3,3
Interest-bearing debt 135,2 144,7 31,8
Current liabilities 263,5 302,7 259,2
399,8 461,7 294,3
Total equity and liabilities 1821,7 1929,3 1863,7
CHANGES IN EQUITY
EUR million
Share
Share issue Treasury Other Retained Minority Total
capital premium shares reserves earnings interest equity
Total equity
at 31.12.2003 69,0 516,7 -24,7 3,4 110,0 73,3 747,7
Cash flow hedges 0,0
Other changes -3,1 -3,1
Net profit for
the period 38,4 1,2 39,6
Total equity
at 31.3.2004 69,0 516,7 -24,7 3,4 148,4 71,4 784,2
Total equity
at 31.12.2004 71,0 561,9 -3,1 3,0 250,7 31,0 914,5
Cash flow hedges -0,1 -0,1
Treasury shares -1,7 1,7 0,0
Dividend -56,8 -3,6 -60,4
Other changes -0,1 2,0 0,6 2,5
Net profit for
the period 32,1 0,9 33,0
Total equity
at 31.3.2005 70,9 561,9 -4,8 2,9 229,7 28,9 889,5
RECONCILIATION OF NET PROFIT
FOR COMPARISON PERIODS 2004
EUR million
1-3 1-12
2004 2004
Profit for the period before minority interest
according to FAS 32,9 113,9
Effects of adopting IFRS:
Reversal of goodwill amortisation 11,2 44,6
Employee benefits 1,2 10,7
Finance leases -6,7 -9,6
Financial instruments -0,6 0,5
Income tax 1,6 -0,8
IFRS adjustments, total 6,7 45,4
Profit for the period according to IFRS 39,6 159,3
Attributable to:
Equity holders of the parent 38,4 151,7
Minority interest 1,2 7,6
39,6 159,3
RECONCILIATION OF EQUITY
FOR COMPARISON PERIODS 2004
EUR million
1.1. 31.3. 31.12.
2004 2004 2004
Total equity according to FAS 699,1 730,5 851,0
Effects of adopting IFRS:
Reversal of goodwill amortisation 11,2 44,6
Employee benefits -24,0 -22,8 -13,5
Finance leases 4,7 -2,0 -4,9
Reversal of revaluations -11,1 -11,1
Financial instruments 0,9 0,5 1,1
Other adjustments 1,7 1,6 1,6
Income tax 3,2 4,8 3,6
IFRS adjustments, total -24,6 -17,8 32,5
Equity holders of the parent 674,5 712,7 883,5
Minority interest according to FAS 77,4 75,7 33,6
IFRS adjustments -4,1 -4,2 -2,6
Minority interest 73,3 71,5 31,0
Total equity according to IFRS 747,8 784,2 914,5
CONSOLIDATED CASH FLOW STATEMENT
EUR million
1-3 1-3 1-12
2005 2004 2004
Cash flow from operating activities
Profit before tax 38,9 56,3 212,5
Adjustments to profit before tax 51,5 62,4 199,7
Change in working capital -30,1 -24,2 4,9
Cash flow from operating activities 60,3 94,5 417,1
Received dividends and interests and interest
paid -7,1 -22,7 -45,8
Taxes paid -0,6 -5,2 -16,0
Net cash flow from operating activities 52,6 66,6 355,3
Cash flow in investments
Capital expenditure -40,6 -42,7 -171,4
Investments in shares and other investments 0,9 -0,4 -10,4
Proceeds from asset disposal 13,0 -14,7 51,4
Net cash used in investment -26,7 -57,8 -130,4
Cash flow after investments 25,9 8,8 224,9
Cash flow in financing
Sales of treasury shares 6,4
Change in interest-bearing receivables 0,1 24,3
Repayment of long-term debt -15,0 -110,7
Change in short-term debt 0,5 -1,6 -15,3
Repayment of financing leases -4,4 -6,7 -21,0
Dividends paid -55,1 -13,0
Cash flow in financing -74,0 -8,2 -129,3
Change in cash and cash equivalents -48,1 0,6 95,6
Cash and cash equivalents at beginning of
period 162,8 67,2 67,2
Cash and cash equivalents at end of period 114,7 67,8 162,8
LIABILITIES
EUR million
31.3. 31.3. 31.12.
2005 2004 2004
Mortgages, pledges and guarantees
Mortgages
For own and group companies 19,0 77,5 27,6
Pledges given
Pledges given as surety 0,9 23,6 0,2
Guarantees given
For others 11,0
Mortgages, pledges and guarantees total 19,9 112,1 27,8
Derivative contracts
Forward contracts and swap agreements
Nominal value of underlying instrument 11,8 14,7 13,5
Leasing contracts and
other commitments
Leasing commitments 17,3 20,6 18,3
Repurchase commitments 0,9 1,8 1,2
Real estate leases 73,1 72,8 77,2
Lease liabilities total 91,3 95,2 96,7
Other commitments
Lease-leaseback agreement (QTE facility)
Termination risk 21,4 25,3 22,8
Total value of the arrangement 156,6 166,0 149,8
Other commitments 5,2 5,1 9,1
KEY FIGURES
EUR million
1-3 1-3 1-12
2005 2004 2004
Shareholders' equity/share, EUR 6,07 5,19 6,23
Net debt 489,3 660,4 462,2
Gearing 55,0 % 87,4 % 50,6 %
Equity ratio 49,3 % 40,9 % 49,3 %
Gross investments in fixed assets 42,0 43,9 180,6
of which finance lease investments 1,4 1,2 10,4
Gross investments as % of revenue 12,6 % 13,2 % 14,1 %
Investments in shares 2,9 0,4 61,1
Average number of personnel 5426 5909 5590
Formulae for financial indicators
Interest-bearing debt - cash and cash equivalents
Gearing % --------------------------------------------x 100
Total equity
Total equity
Equity ratio % ---------------------------------- x 100
Balance sheet total - advances received
Net debt Interest-bearing debt - cash and cash equivalents
Equity attributable to equity holders of
the parent
Shareholders' equity/share --------------------------------------------
Number of shares outstanding at end of period
Profit for the period attributable to
equity holders of parent
Earnings/share -----------------------------------------
Average number of outstanding shares
ACCOUNTING PRINCIPLES
This Interim Report has been prepared in accordance with IAS 34 Interim
Financial Reporting. Accounting principles are described by detail in
Elisas' comparative IFRS information for 2004 which was published in 8
April 2005. Press release is availabe on Elisa's website at elisa.com.
