PROFIT FROM SALES PROPELS KYRO?S SUCCESS YEAR TO RECORD RESULT
Kyro Corporation STOCK EXCHANGE RELEASE 8 February 2006, 8.30 a.m.
PROFIT FROM SALES PROPELS KYROS SUCCESS YEAR TO RECORD RESULT
- Kyros net sales in 2005 were EUR 266.7 (231.4) million, up by 15%
- Profit before taxes was EUR 34.2 (22.5) million, up 51%
- Operating profit EUR 35.5 (20.5) million, up 74% including the
the sales of the hydropower and district heat operations
- The Board of Directors proposes a dividend of EUR 0.08 per share and a
supplementary dividend of EUR 0.09 per share
- New machine orders totalled EUR 177.8 (153.6) million, up 15.8%
- The Groups order book on 31 December 2005 stood at EUR 140.7 (135.5)
million, up 4%
- Equity ratio 64.4% (59.3)
KYRO GROUP STRUCTURE
Kyros business areas are Glaston Technologies and Energy. The main business
area, Glaston Technologies, consists of the Glass Machinery Group and the Glass
Processing Group.
The Glass Machinery Group is the world market leader in glass processing
machines. The Glass Machinery Groups products are glass pre-processing machines
as well as safety glass machines for the architectural and automotive
industries. The group consists of Tamglass, the technology and market leader in
safety glass machines, Uniglass, which manufactures flat tempering machines, and
the leading supplier of glass pre-processing machines Z. Bavelloni, which also
produces stone processing machines.
The Glass Processing Group focuses on markets in Finland and neighbouring
countries and is the leading comprehensive supplier of architectural glass
products in Finland. The products sold under its Tamglass brand are safety,
insulating and balcony glasses and balcony systems.
Kyros second business area is Energy, which consists of the electricity and
heat generating gas-fired combi power plant of Kyro Power Oy. The hydro-power
and district heat distribution operations of the Energy business area were sold
in December 2005.
NET SALES AND PROFIT
The Kyro Groups net sales in 2005 were EUR 266.7 (231.4) million, 15%
growth. The Groups operating profit was EUR 35.5 (20.5) million, 74%
growth, and represented 13.3% (8.8) of net sales. Comparable operating
profit, excluding profit from sales, was EUR 23.0 (20.5) million,representing
growth 12.2%, and 8.6% (8.8) of net sales.
The Groups profitability was affected by operational development projects
carried out. The most significant of these are the development of Glaston
Technologies operations and networks, the centralisation of the Groups
financial administration, the development of IT systems and expansions of
production and business operations in China and Brazil. Costs of these
development measures were concentrated for 2005 and result improvement is
expected for 2006 and beyond.
The Energy business areas hydropower and district heat distribution
operations were sold in December 2005 for a total debt-free price of around
EUR 26.8 million. The profit before taxes from the sales totalled EUR 12.5
million. In Kyros 2005 income statement, the sold operations accounted for
around EUR 2.3 million in net sales and around EUR 0.8 million in operating
profit up to the date of the sale. The sold businesses together constituted
around 10% of Kyro Powers net sales.
Profit before taxes was EUR 34.2 (22.5) million, which represented 12.8%
(9.7) of net sales. Profit for the financial year was EUR 22.4 (14.7)
million. The return on invested capital was 21.7% (15.7). Earnings per share
were EUR 0.28 (0.18) and equity per share was EUR 1.76 (1.54). Comparable
earnings per share excluding capital gains were 0.16 (0.18).
Net financial items totalled EUR 1.3 (2.1) million. This includes interest,
dividend and other financial income of EUR 2.4 (4.0) million, and interest
and other financial expenses of EUR 3.7 (1.9) million. The difference is
explained by unrealised foreign exchange losses on the Groups interest loan
balances of EUR 0.8 million, which is included in other financial items. In
addition, classification and valuation rules for financial assets according
to IAS 39 were adopted from the beginning of 2005, as a result of which
unrealised increases in the value of financial securities amounting to
EUR 0.7 million at the time of adoption, adjusted for taxes, were recognised
directly in shareholders' equity.
The Groups order book at the end of 2005 was EUR 140.7 (135.5) million.
Glaston Technologies order book at 31 December 2005 was EUR 108.8 (111.0)
million.
The business of the Groups parent company consists of financing and investing
activities, as well as group administration services. The parent companys net
sales totalled EUR 0.9 (0.8) million and its profit for the financial year was
EUR 17.0 (10.5) million. The result was influenced by a Group contribution
received of EUR 22.5 million.
Net sales, operating profit and order book, EUR million
Net sales Net sales Order book
2005 2004 2005 2004 2005 2004
Glaston Technologies* 238.9 203.0 22.1 18.4 108.8 111.0
Energy 27.6 28.4 18.9 5.7 31.9 24.5
Parent company,
other operations
and eliminations 0.2 -0.0 -5.5 -3.6
Group total 266.7 231.4 35.5 20.5 140.7 135.5
FINANCING
The Groups financial standing is very good. Equity ratio was 64.4% (59.3) at
the end of the year. By a decision of the Annual General Meeting, a total of
EUR 5.6 million was distributed as dividends in 2005.
Cash flow from business operations was EUR 22.5 (15.7) million in 2005. The
Groups liquid funds totalled EUR 26.3 (11.5) million on 31 Dec, 2005. Interest-
bearing net liabilities amounted to EUR 24.7 (8.7) million. Gearing stood at
17.7% (7.1).
CAPITAL EXPENDITURE
The Kyro Groups capital expenditure totalled EUR 11.5 (6.8) million. This
includes Glass Processings new insulating glass production line and other
glass processing machines, EUR 3.0 million, the construction of Glaston
Technologies new production plant in China, EUR 1.7 million, product
development capitalisations under IFRS, EUR 4.0 million, as well as normal
repair and maintenance expenditure.
RESEARCH AND PRODUCT DEVELOPMENT EXPENDITURE
Research and development expenditure entered in the income statement totalled
EUR 7.3 (7.1) million in the financial year. All of this expenditure related
in practice to Glaston Technologies. Research expenditure was directed at
tempering machine heating and chilling technology, glass grinding technology
and automation. Product development expenditure was mainly connected with
Tamglass new flat tempering machine, Bavellonis new pre-processing line and
both companies development of machines suitable for handling jumbo glass
sizes.
ORGANISATION AND PERSONNEL
The Glass Machinery Group of Glaston Technologies, Kyros main business area,
consists of Tamglass, Z. Bavelloni and Uniglass Engineering. In December 2005
Paolo Sandri was appointed Managing Director of Z. Bavelloni following the
retirement of his long-serving predecessor Dino Bavelloni. Cosimo Gabriele
was appointed Managing Director of DiaPol S.r.l, a tool company founded at
the beginning of 2006.
Glaston Technologies Glass Processing Group consists of the companies
Tamglass Safety Glass, Tamglass Insulating Glass and Tamglass Finton. In
December 2005 Claus Carlsen was appointed Managing Director of the Glass
Processing Group and Tamglass Safety Glass, following the transfer of Glass
Processings long-serving Director Pertti Iivanainen to the position of the
groups Business Development Director.
Kyro Energy business area consists of Kyro Power Oy, whose Managing Director
is Esa Kujala.
At the end of financial year, the Kyro Group had 1,222 (1,208) employees, of
whom 781 (775) worked outside Finland. The average number of employees during
the year was 1,218 (1,175). There was a modest increase in the number of
personnel. The increase mainly resulted from the recruitment of additional
product development staff as well as the establishment of new service and
maintenance points.
Personnel
31.12.2005 31.12.2004
Glaston Technologies 1,191 1,175
Energy 23 23
Kyro Corporation 7 10
Kyro Group 1,222 1,208
SHARES AND SHARE PRICES
A total of 18,054,297 Kyro Corporation (KRO1V) shares were traded during
2005, which equals 22.8% (19.4) of the total number of shares. The lowest
price paid for a share on the Helsinki Exchanges was EUR 3.79 and the highest
price EUR 4.60. The average price during the year was EUR 4.25.
ACQUISITION AND DISPOSAL OF OWN SHARES
The Annual General Meeting on 15 March 2005 authorised the Board of Directors to
acquire the companys own shares for the purpose of using them as consideration
in possible acquisitions, to finance investments or in other industrial
arrangements or to be disposed of in other ways or to be invalidated.
According to the authorisation the Board of Directors may acquire the company's
own shares using assets available for distribution of profits, provided that the
combined nominal value of the acquired shares together with any shares already
in the possession of the company corresponds to a maximum of 5 per cent of the
companys total share capital at the moment of acquisition. Shares can be
acquired or sold in public trading on the Helsinki Exchanges at the market value
of the shares at the time in question.
The authorisations to acquire and dispose of the companys own shares are valid
for a period of one year from the decision of the Annual General Meeting on 15
March 2005. On 31 December 2005, Kyro Corporation held a total of 329,904
(329,904) of its own shares, acquired on the basis of previous authorisations.
The company did not exercise the authorisation in 2005.
MANAGEMENT INCENTIVE SCHEME
The Group operates a management incentive scheme, approved in 2002, which covers
key Tamglass personnel and Kyros management. 23,250 A options, with an exercise
period of 1 May 2005 to 31 May 2009, and 21,750 B options, with an exercise
period of 1 May 2007 to 31 May 2009, have been awarded.
In accordance with a restriction in the incentive scheme, share subscription by
exercising the options is possible only with the permission of Kyro Corporation,
but the options may be sold to Kyro Corporation during their exercise period at
a price which is defined as the difference between the imputed value of the
share and the subscription price. 2/3 of the imputed value of the share is based
on the results of the Tamglass and Kyro Groups and 1/3 on the development of the
Kyro share price. The total value of the options right at the moment of
realization cannot exceed 15% of Kyro Groups cumulative net result starting
from the accounting period of 2002.
BOARD OF DIRECTORS AND AUDITORS
The term of office of Kyro Corporations Board of Directors is 20042007. The
members of the Board of Directors are Klaus Cawén, Lars Hammarén, Barbro
Koljonen, Heikki Mairinoja, Carl-Johan Numelin, Carl-Johan Rosenbröijer and
Christer Sumelius. In 2005 the Board of Directors elected Carl-Johan Numelin
as Chairman of the Board of Directors and Christer Sumelius as Deputy
Chairman.
Under the Articles of Association the company has one auditor, which must be
an auditing firm approved by the Finnish Central Chamber of Commerce. The
auditors term of office covers the current financial year and ends at the
conclusion of the Annual General Meeting that follows its election. The 2005
Annual General Meeting elected as auditor the authorised public accounting
firm KPMG Oy Ab, with the responsible auditor being Sixten Nyman APA, who
supervises auditing guidelines and coordination for the entire Group.
BOARD OF DIRECTORS DIVIDEND PROPOSAL FOR FINANCIAL YEAR 2005
Kyro Corporations Board of Directors proposes that a dividend of EUR 0.08 per
share and a supplementary dividend of EUR 0.09 per share be distributed for the
financial year ending 31 December 2005. Dividend-entitling shares totalled
79,020,096 on 7 February 2006. The dividend shall be paid to shareholders
entered in the register of shareholders maintained by the Finnish Central
Securities Depository Ltd by the date of record, 21 March 2006. The Board of
Directors proposes that the dividend be paid on 28 March, 2006.
CORPORATE GOVERNANCE
Kyro adheres where applicable to the recommendation on the corporate
governance of listed companies issued by the Helsinki Exchanges on 1 July
2004. Kyros Board of Directors has established Audit and Remuneration
Committees consisting of its own members. The members of the Audit Committee
are Lars Hammarén, Heikki Mairinoja and Carl-Johan Numelin (Chairman). The
members of the Remuneration Committee are Klaus Cawén, Carl-Johan Numelin
(Chairman) and Christer Sumelius.
IFRS ACCOUNTING POLICIES
The Kyro Group adopted the International Financial Reporting Standards (IFRS) in
its financial reporting at the beginning of 2005. These financial statements use
2004 figures prepared according to IFRS as comparative data.
On 6 April 2005, Kyro published a separate stock exchange release on the effects
of the adoption of IFRS on the result and balance sheet. The most significant
changes arise from a change in revenue recognition policies, the capitalisation
of product development expenses, the accounting of subsidiaries share options
and the replacement of goodwill amortisation with annual impairment testing.
The sales recognition policy under IFRS increases the order book of the Groups
Glaston Technologies business area. Compared with a revenue recognition practice
under Finnish Accounting Standards based on the time of dispatch of deliveries,
under IFRS deliveries remain in the order book until they have been surrendered
to the customers use and/or responsibility.
The financial statements treatment of emissions trading, which started at the
beginning of 2005, follows the IFRS accounting practice, which permits the
recognition of emissions trading at acquisition cost. As of 1 January 2005, the
Kyro Group has applied classification and valuation rules for financial assets
as well as hedge accounting of foreign currency and electricity derivatives in
accordance with the IAS 32 and IAS 39 standards. The impact of the IAS 39
standard on the companys shareholders equity was EUR 1.0 million on the date
of adoption, 1 January 2005.
GLASTON TECHNOLOGIES NET SALES, OPERATING PROFIT AND ORDER BOOK
Glaston Technologies net sales totalled EUR 238.9 (203.0) million in the period
under review, up by 18%. Operating profit was EUR 22.1 (18.4) million,
representing 21% growth from the previous year and 9.3% (9.0) of net sales. The
order book fell slightly from the previous year and stood at EUR 108.8 (111.0)
million. On the other hand, 15.8% more new orders were received compared with
the previous year and totalled EUR 177.8 (153.6) million. The order intake in
December was EUR 27.2 (28.3) million.
The Glass Machinery Groups turnover rose significantly from the previous
year due to a good market situation, and profitability also improved due to
volume growth. The strong euro continued to impose price pressures on both
the customer and the seller outside the eurozone, weakening volume and
profitability. Profitability was also affected by a number of operational
development projects.
The Glass Processing Groups turnover grew slightly from the previous year,
but its profitability was a disappointment. The weak profitability of the
groups insulating glass and particularly balcony operations was due mainly
to a changed competitive situation.
GLASTON TECHNOLOGIES - GLASS MACHINERY GROUP
Market and sales
Glass processors must be able to deliver not only demanding products but also
greater efficiency, which is increasing demand for large-capacity, high-
technology glass processing machines. Demand for safety glass and pre-
processing machines made by Glaston Technologies grew clearly in 2005. The
Glass Machinery Group grew strongly, increasing its market share and
improving its profitability, at the same time while 2005 was also a year of
high development expenditure and intense product development.
Demand was focused on large, demanding architectural glass machines. Demand
for automotive glass machines was lower at the beginning of the year, but
improved towards the end of the year. Geographically the biggest growth area
was the USA, where the use of energy glass and a pick-up in construction
sharply increased demand for safety glass machines. Demand also grew in the
EMA (Europe, Middle East and Africa) area, particularly in the Middle East.
The Central European market revived from the previous year and started to
grow. In Asia, particularly in China, development was in the opposite
direction and an overheated market declined.
Pre-processing machines sold well, particularly Bavellonis cutting machines
and grinding equipment. The main market area for pre-processing machines is
the EMA area, while sales of stone processing machines accelerated during the
year in Central Europe and the USA.
Sales of tools intended for glass and stone pre-processing also grew during
the year, particularly through the launch of a new series of polishing tools.
The strongest growth area was the USA. To develop its tool business, Kyro
incorporated Bavellonis tool division at the beginning of 2006.
During 2005 Glaston Technologies further developed its One-Stop-Partner
concept, whose range of products and services consists of machine and
production line deliveries, maintenance services and tools. Customers can
acquire from a single supplier products and services according to their
needs, all the way to a complete glass processing factory.
The strategic business areas and sales groups of Tamglass and Bavelloni were
merged at the beginning of 2005. This will support the development of Tamglass
and Bavelloni business operations and will improve customer service. The merger
of the sales organisations has translated into a growth in sales.
Production and new products
Glaston Technologies machine manufacturing in Finland, Italy, the USA, China
and Brazil is based on its own product development, assembly and a strong
subcontracting network. As a result, capacity utilisation is flexible, which in
2005 again enabled good throughput of an exceptionally high order book. The
utilisation rates of the machine factories were generally on a good level
throughout the year.
Glaston Technologies most significant product launch was a line jointly
developed by Tamglass and Bavelloni that is suitable for the pre-processing and
tempering of large architectural glasses as well as smaller appliance and window
glass. The line consists of a new, worlds fastest flat tempering machine,
Tamglass Sonic, and Bavellonis automatic, integrated pre-processing line, which
performs the grinding, cutting and perforation that precede tempering.
The Glass Machinery Group also strengthened its One-Stop-Partner concept in
China, where Tamglass expanded its locally manufactured range of tempering
machines and Bavelloni began producing glass pre-processing machines. Glaston
Technologies production in Tianjin, China will move from rental premises into
its own new facility at the beginning of 2006.
Uniglass Engineering, which specialises in flat tempering machines, strengthened
its market position in 2005 as the second biggest supplier in Europe and the USA
after Tamglass. There was also demand for Uniglass machine in the Middle East
and Eastern Europe. Overall, demand at Uniglass was higher than expectations.
Maintenance and service business
Demand and volume of Glaston Technologies maintenance and service business
again grew in 2005, with overall growth being nearly 20%. The main areas of
growth were the USA and Central Europe.
The Tamglass and Bavelloni maintenance and service operations were developed and
working practices standardised. The intention is to enhance the integration of
Glaston Technologies sales and maintenance organisations during 2006.
The maintenance contract book for safety glass machines grew by a record 23%.
Installation business was brisk throughout the year, and more installation and
maintenance staff were recruited, particularly in the USA and Europe.
As a result of an active sales work, spare parts sales also grew, as did
accessory and control system updates, which enable customers earlier-generation
machines to be enhanced to meet the safety glass markets latest requirements.
Glaston Technologies goal is to offer its customers good service in all the
main market areas, and during the year it opened three new maintenance service
offices.
GLASTON TECHNOLOGIES GLASS PROCESSING GROUP
Market and sales
Glass Processing Groups biggest customer segment, the construction industry,
grew in Finland in 2005, particularly office and residential building. The
Glass Processing Group overall slightly grew its volumes and strengthened its
market position. In addition, it grew its position as an exporter of special
automotive glasses to, among other countries, the UK and Germany.
In 2005 the Glass Processing Group invested in developing its production by
introducing new insulating glass and grinding lines, which improve its
reliability and capacity. The group also continued its active networking, with
good results. Maaseudun Kone, a manufacturer of drivers cabins for tractors,
chose Glass Processing to improve the competitiveness of its Valtra tractor, and
the Agco Group, which manufactures Valtra tractors, recognised Tamglass Safety
Glass with its Spare Parts Supplier of the Year award.
The Glass Processing Groups most notable reference projects in the final
quarter of the year were glazing deliveries for the If building in Espoo and
for the Central Finland Central Hospital.
In the insulating glass sector, Finnish suppliers are encountering increasing
competition from Estonia. The Glass Processing Groups capacity to respond to
challenges has improved, however, due to the investments made in 2005.
Balcony business, on the other hand, suffered from price competition, which
significantly weakened the profitability of Tamglass Finton and of the whole
Glass Processing Group. The balcony business is currently being examined to
find solutions to improve its operational efficiency. Possible measures will
be initiated during the first half of 2006.
ENERGY
Net sales, operating profit and order book
The net sales of the Energy business area totalled EUR 27.6 (28.4) million in
the period under review. The operating profit was EUR 18.9 (5.7) million,
which includes a EUR 12.5 million profit from the sales of the hydropower and
district heat network operations in December 2005. Profit from operations was
therefore EUR 6.4 (5.7) million, up 14% from the previous year. This
operating profit represented 23.2% (20.0) of net sales. Kyro Powers order
book at the end of the year was EUR 31.9 (24.5) million. The high order book
is explained mainly by a rise in the price of electricity.
Development of the energy market
The price of emission rights became a significant factor driving the market
price of electricity in 2005, instead of pricing based on rainfall and the
Nordic water situation.
The price of emission rights at the beginning of June reached nearly 30 euros
per tonne and continued thereafter in the range 20-23 euros. The electricity
price in Finland in July and August was higher than at any time since 1998. The
level of the electricity price continued to rise in early winter, despite the
normalisation of the water situation. Overall, the market price of electricity
in 2005 was clearly more stable than in previous years. The rise in the price of
oil, on the other hand, affected the price of natural gas, the gas-fired power
plants main fuel, which rose further at the beginning of 2006.
Kyro Powers current price contracts with M-real and Finnforest expire in the
middle of 2007. After this, the companys profitability will be affected
particularly by the level of the market prices of natural gas and electricity.
Energy production
In 2005 energy production at the gas-powered plant fell short of the previous
years level. The decline was due to a forest industry labour dispute, which
lasted seven weeks. Electricity production was also limited by the start of
emissions trading and the rapid rise in the price of both emissions rights
and natural gas.
Hydropower production was nearly at normal levels despite a modest spring
flood. Compared with the dry year of 2004, the hydropower plants electricity
production increased by 30%.
Development of operations
As part of the Partner project initiated in October 2004, the Group implemented
an arrangement which will see Kyro Power concentrate more fully on being an
energy supplier to industry, thus making it less dependent on the market price
of electricity.
On 8 December 2005, Kyro Power Oy sold its Hämeenkyrö hydropower operations plus
balance sheet items to Kyröskosken Voima Oy and the shares of its district heat
company to Leppäkosken Sähkö Oy. No personnel were transferred in connection
with the sales.
The purpose of the continuing Partner project is to find for Kyros energy
business area partnership or ownership arrangements that will promote its
competitiveness. After the sale of the hydropower business and district heat
distribution company, Kyro Power consists of a gas-fired combi power plant that
produces heat, steam and electricity for the needs of industry.
FUTURE OUTLOOK
The industrys most extensive customer service network, widest product range
and the One-StopPartner concept create for Glaston Technologies good
opportunities to fulfil customers needs better than before. The main
business area, Glaston Technologies, is a technology and market leader in a
growing business sector. The levels of its order and offer books are good at
the beginning of the year. Kyro Groups position as it enters 2006 is
fundamentally sound.
Kyros financial position is excellent and the intention is to use the capital
released from the Energy business area to make possible company acquisitions in
line with the Groups strategy.
Providing that demand in the Glaston Technologies business area remains at least
at the present level, Kyro aims in 2006 to again increase its net sales and
comparable operating profit by strengthening its market position and enhancing
the efficiency of its operations.
SCHEDULE OF FINANCIAL RELEASES
The Kyro Group will publish three interim reports in 2006, as follows:
Interim report 1-3/2006 will be published on 10 May 2006
Interim report 1-6/2006 will be published on 16 August 2006
Interim report 1-9/2006 will be published on 7 November 2006
Kyros Annual General Meeting will be held on 16 March 2006 at 4 p.m. in the
Hilton Helsinki Kalastajatorppa Hotel.
The printed version of the annual report will be sent to shareholders in week
10. An electronic version will also be published on the internet at
www.kyro.fi.
Helsinki, 8 February 2006
Kyro Corporation
Board of Directors
Additional information about Kyros financial statements can be obtained from
Kyro Group President & CEO Pentti Yliheljo and Chief Financial Officer Vesa
Hopia, tel. +358 3 382 3111.
Investor Kyro Corporation, IR and Communications Manager Emmi
Watkins,
Relations: tel. +358 400 903 260 / emmi.watkins@kyro.fi, IR pages at
www.kyro.fi
Distribution: Helsinki Exchanges
Key media
KYRO GROUP 1-12/2005, INCOME STATEMENT AND BALANCE SHEET
1-12/2005 1-12/2004
Consolidated Income Statement, EUR million
Net sales 266.7 231.4
Other operating income 14.9 1.1
Operating expenses 237.4 203.6
Depreciation 8.7 8.4
Operating profit 35.5 20.5
% of net sales 13.3 8.8
Net financial income and expenses -1.3 2.1
Profit before taxes 34.2 22.5
Income tax -11.9 -7.9
Profit for the financial year 22.4 14.7
Distribution of profit for financial period
To parent company shareholders 22.4 14.5
To minority 0.0 0.2
Profit for the financial year 22.4 14.7
Consolidated Balance Sheet, EUR million 31.12.2005 31.12.2004
Assets
Non-current assets 121.3 133.1
Inventories 59.6 63.3
Trade and other receivables 49.3 40.0
Assets recognised at fair value
through profit and loss 0.1 5.3
Cash and cash equivalents 26.3 6.2
Assets, total 256.5 248.0
Shareholders equity and liabilities
Parent company's shareholder's equity 139.0 121.6
Minority interest 0.0 0.5
Shareholders equity, total 139.0 122.2
Liabilities arising from employee benefits 6.6 6.0
Provisions 3.2 1.6
Non-current interest-bearing liabilities 1.2 0.7
Non-current non-interest-bearing 7.8 8.0
liabilities
Current interest-bearing liabilities 1.7 19.6
Current non-interest-bearing liabilities 97.0 89.8
Shareholders equity and liabilities, 256.5 248.0
total
Cash flow calculation
1-12/2005 1-12/2004
Cash flow from business operations 22.6 15.7
Cash flow from investments 15.4 -6.5
Net cash flow from financing -17.9 -23.7
Change in liquid assets 20.1 -14.6
Key figures
Return on capital invested, % 21.7 15.7
Return on equity, % 17.1 11.9
Equity ratio, % 64.4 59.3
Gearing, % -17.7 7.1
Equity per share, EUR 1.76 1.54
Investments, EUR million 11.4 6.8
Personnel at end of year 1 222 1 208
Personnel, average 1 218 1 175
Order book, EUR million 140.7 135.5
Key figures per share
Earnings per share, EUR 0.28 0.18
Equity per share, EUR 1.76 1.54
Number of shares, 1,000 79 350 79 350
- of which outstanding 79 020 79 020
Average number of shares 79 020 79 020
Share price, EUR
Average price 4.25 3.92
Lowest price 3.79 3.40
Highest prices 4.60 4.16
Share price at end of year 4.06 4.10
Market capitalisation at end of
financial year
EUR million 322.16 325.3
Shares traded, number 18 054 297 15 424 328
Shares traded, % of total 22.80 19.40
Value of shares traded, EUR million 79.0 60.5
Dividend per share, EUR* 0.08 0.07
Supplementary dividend per share, EUR* 0.09
Dividend/result, % 60.7 38.9
Effective dividend yield, % 4.2 1.7
Price/earnings ratio, (P/E) 14.5 22.8
* Board of directors proposal
Guarantees and contingent liabilities, EUR million
31.12.2005 31.12.2004
Company mortgages 0.2 0.4
Other own liabilities 7.1 6.5
Derivatives contracts
Value of underlying assets
Forward currency contracts 14.1 17.6
Electricity contracts 9.6 2.3
Fair value
Forward currency contracts
Positive fair value 0.0 0.6
Negative fair value -0.3 0.0
Electricity contracts
Positive fair value 0.0 0.5
Negative fair value -2.1 0.0
Business areas' net sales,
operating profit and order
book, EUR million
Net sales
1-3/04 4-6/04 7-9/04 10-12/04 1-3/05 4-6/05 7-9/05 10-12/05
Glaston 52.8 53.9 47.1 49.3 50.7 60.6 52.8 74.8
Tecnologies
Energy 7.5 6.5 6.7 7.7 8.0 5.1 6.8 7.7
Parent 0.0 0.0 -0.1 0.0 0.1 0.1 0.1 0.0
company, other
operations and
eliminations
Group, total 60.3 60.4 53.7 57.0 58.7 65.8 59.6 82.5
Operating
Profit 1-3/04 4-6/04 7-9/04 10-12/04 1-3/05 4-6/05 7-9/05 10-12/05
Glaston 7.1 4.6 5.0 1.7 4.5 6.2 5.8 5.5
Tecnologies
Operating 13.5 8.5 10.5 3.4 9.0 10.3 11.1 7.4
profit %
Energy 1.7 1.2 1.0 1.7 2.0 1.1 1.5 14.3
Net sales % 23.1 18.3 15.5 22.3 25.1 20.5 22.4 185.9
Parent -0.8 -0.6 -0.8 -1.3 -1.4 -1.6 -1.1 -1.4
company, other
operations and
eliminations
Group, total 8.0 5.1 5.2 2.1 5.1 5.7 6.3 18.4
Operating 13.3 8.5 9.8 3.6 8.7 8.7 10.5 22.3
profit %
Order book 3/04 6/04 9/04 12/04 03/05 6/05 9/05 12/05
Glaston 93.5 97.6 100.8 111.0 114.5 122.1 119.4 108.8
Tecnologies
Energy 22.7 22.7 22.7 24.5 24.6 23.2 23.0 31.9
Group total 116.2 120.3 123.5 135.5 139.1 145.3 142.4 140.7
Statement of change in Groups shareholders equity
EUR million Share- Share- Own Transla- Fair- Retained Mino-
holders' premium Shares tion dif- value earnings rity
equity fund ferences fund interest Total
Shareholders'
equity
1.1.2005 12.7 25.3 -1.0 -0.1 84.7 0.5 122.2
IAS 39. Financial
instruments.
recognition
and 0.5 0.5
valuation
IAS 32.
Reclassifi-
cation
of minority -0.1 -0.4 -0.5
interest
Redemption
of minority
interest -0.1 -0.1
Change in translation
difference 1.6 1.6
Recognitions
to fair
value fund -1.6 -1.6
Dividend
distribution -5.5 -5.5
Profit for
financial
year 22.4 0.0 22.4
Shareholders'
equity
31.12.2005 12.7 25.3 -1.0 1.5 -1.6 102.0 0.0 139.0
EUR million Share- Share- Own Transla- Fair- Retained Mino-
holders' premium Shares tion dif- value earnings rity
equity fund ferences fund interest Total
Shareholders'
equity
1.1.2004 6.3 31.6 -1.0 0.7 86.1 0.4 124.1
Bonus issue 6.3 -6.3
Change in translation
difference -0.8 -0.8
Dividend
distribution -15.8 -15.8
Profit for
financial
period 14.5 0.2 14.7
Shareholders'
equity
31.12.2005 12.7 25.3 -1.0 -0.1 84.7 0.5 122.2
Profit for the financial period, reconciliation calculation
EUR million 1-12 2004
Profit for the financial year before minority interest, 11.6
FAS
Impacts of transferring to IFRS:
Change of revenue recognition policy -0.6
Inclusion of fixed expenses in inventories 0.4
Capitalisation of product development expenses 1.9
Cancellation of amortisation of goodwill 2.9
Employee benefits 0.2
Share-based payments -1.3
Lease agreements -0.1
Income tax -0.4
IFRS adjustments, total 2.9
Profit for the financial year, IFRS 14.5
Distribution of profit for financial period
To parent company shareholders 14.3
To minority 0.2
14.5
Shareholders' equity, reconciliation calculation
EUR million 1.1 2004 31.12 2004
Shareholders' equity, FAS 135.9 130.5
Impacts of transferring to IFRS:
Change of revenue recognition policy -21.5 -20.8
Inclusion of fixed expenses in inventories 2.8 1.7
Capitalisation of product development expenses 3.1 4.5
Cancellation of amortisation of goodwill 2.9
Employee benefits 0.5 -0.2
Share-based payments -0.2
Lease agreements -0.1 -0.1
Financial instruments -1.2 -1.0
Other adjustments 0.1 0.1
Income tax 4.4 3.9
IFRS adjustments, total -12.1 -8.8
To parent company shareholders 123.7 121.6
Minority interests, FAS 2.2 4.1
IFRS adjustments -1.8 -3.6
To minority 0.4 0.5
Shareholders' equity, IFRS 124.1 122.2
