PONSSE?S IFRS-COMPLIANT INTERIM REPORT FOR 1 JANUARY - 30 JUNE 2005
PONSSE OYJ STOCK EXCHANGE RELEASE 20 July 2005, 9.00 a.m.
PONSSES IFRS-COMPLIANT INTERIM REPORT FOR 1 JANUARY - 30 JUNE 2005
- Consolidated turnover: EUR 118.9 million (Q1-Q2/2004: EUR 89.7 million)
- Q2 turnover: EUR 59.5 million (Q2/2004: EUR 45.7 million)
- Exports and foreign business operations accounted for 64.4% of turnover
(Q1-Q2/2004: 60.6%)
- Operating profit: EUR 13.5 million (Q1-Q2/2004: EUR 8.5 million)
- Operating profit accounted for 11.4% of turnover (Q1-Q2/2004: 9.5%)
- Q2 operating profit: EUR 6.3 million (Q2/2004: EUR 3.7 million)
- Profit after financial items: EUR 13.3 million (Q1-Q2/2004: EUR 8.7 million)
- Earnings per share (EPS): EUR 0.68 (EUR 0.40)
- Equity ratio: 40.0% (39.4%)
- Order books: EUR 41.1 million (30 June 2004: EUR 38.7 million)
Arto Tiitinen, President and CEO, makes the following statement:
- Our business performance for the first two quarters of 2005 progressed
in line with our targets in both domestic and international markets. Our new
subsidiaries began operating in Russia and Brazil. In early July,
Ponsse purchased 92 per cent of Lako Oys shares. This acquisition
strengthens our position as supplier of harvester heads for excavator-based
machines. This arrangement provided a rapid solution for bark removal of
eucalyptus trees, particularly considering the needs of the South American
market.
- Our results developed positively due to the marketing efforts
implemented in the spring and development measures within the distribution
network. Exports share of total turnover reached an all-time high.
- During the review period, we launched a project to extend the assembly
plant in Vieremä in co-operation with the municipality of Vieremä. The new
plant will be completed during week 43 in October. In the period, we also
started to construct a customer service centre adjacent to the Vieremä
plant. These premises,due for completion toward the end of the year,
will also facilitate the full-scale launch of Ponsse Academys operations.
IAS/IFRS-COMPLIANT REPORTING
Since 1 January 2005, Ponsse Group has applied the International Financial
Reporting Standards (IFRS) to its financial reporting. IFRS-compliant figures for
2004 are used as comparative data in this interim report. The accounting
principles are the same as those applied in the release of 22 March 2005.
TURNOVER
Consolidated turnover rose by 32.6 per cent year-on-year, to EUR 118.9 million
(EUR 89.7 million). The positive trend was due particularly to growth in sales of
new machines, the dynamic used-machines business early in the year,
and favourable development of maintenance services.
International business operations accounted for 64.4 per cent (60.6 per cent) of
turnover, while domestic sales accounted for 35.6 per cent (39.4 per cent).
Ponsse strengthened its position both in the export and domestic markets
in the first two quarters.
PROFIT PERFORMANCE
Ponsses operating profit came to EUR 13.5 million (EUR 8.5 million), which is
58.2 per cent higher than the previous year, accounting for 11.4 per cent of
turnover (9.5 per cent). Return on investment (ROI) stood at 37.6 per cent (28.3
per cent).
The Groups financial income and expenses totalled EUR -0.3 million (EUR 0.1
million). Income and expenses resulting from currency risk hedging were included
in financial items. The period saw no entries of extraordinary items.
Profit for the period totalled EUR 9.6 million (EUR 5.6 million). Earnings per
share were EUR 0.68 (EUR 0.40).
BALANCE SHEET AND FINANCIAL POSITION
On 30 June 2005, the consolidated balance-sheet total amounted to EUR 105.0
million (EUR 86.2 million). Interest-bearing liabilities totalled
EUR 26.6 million (EUR 27.9 million) and net liabilities EUR 14.0 million
(EUR 15.5 million). Equity ratio stood at 40.0 per cent (39.4 per cent).
Cash in hand and at banks rose to EUR 12.7 million (EUR 12.9 million).
The Groups liquidity was good in the period under review.
Reported cash flow from business operations totalled EUR 9.0 million
(EUR 9.4 million), while that from investing activities was EUR -3.6 million
(EUR -1.5 million).
ORDER INTAKE AND ORDER BOOKS
The order intake for the period totalled EUR 115.9 million (EUR 95.3 million)
while period-end order books were valued at EUR 41.1 million (EUR 38.7 million).
Order books included dealers minimum purchase commitments, based on previous
practice.
SUBSIDIARIES
The establishment of Ponsse Latin America Ltda reinforced Ponsses distribution
network during the period. The company is responsible for the development of
Ponsse operations in South America and the marketing of Ponsse Groups products.
The companys main operating area is Brazil, in the domicile Mogi das Cruzes.
On 1 May Mr. Claudio Costa commenced his new post as President of the subsidiary.
The operating area of Ponsse USA Inc, established in 1995, was expanded to cover
the functions of the entire North American region. The company is responsible for
the development and cost-efficiency of Ponsses maintenance and distribution
network in the United States and Canada. The company's name was changed to Ponsse
North America Inc in order to better comply with its new role.
Ponsses subsidiary operating in Russia, OOO Ponsse, was registered during the
period under review. Launch of its operations has progressed according to
targets,and Mr. Ville Siekkinen began his post as President on 1 May.
After the period under review, on 1 July, Ponsse Oyj announced the acquisition of
92 per cent of Lako Oy, based in Turku. Lako Oy will continue to operate as an
independent Ponsse Oyj subsidiary, headed by President Turkka Lastunen.
CAPITAL EXPENDITURE AND R&D
The most significant capital expenditure of the period consisted of finalising
the maintenance service centre extension in Iisalmi, finalising the R&D and
design facilities adjacent to the Vieremä plant, renovation of office premises
and thelaunch of the customer service centre. Furthermore, the company began to
renovate the premises rented to Epec Oy in Kajaani.
During the period, capital expenditure totalled EUR 3.6 million (EUR 1.5 million)
and R&D expenses EUR 2.3 million (EUR 1.6 million).
PERSONNEL
The Group had an average staff of 701 (595) during the period and employed 767
(638) personnel at period-end.
SHARE PERFORMANCE
The trading volume of Ponsse Oyj shares for 1 January - 30 June 2005 totalled
1,358,067, accounting for 9.7 per cent of the total number of shares. Share
turnover came to EUR 23.5 million, with the periods lowest and highest price
amounting to EUR 14.50 and EUR 19.51, respectively. On 30 June 2005, the share
price closed at EUR 18.70 and market capitalisation totalled EUR 261.5 million.
PROSPECTS
Many of Ponsses main markets saw positive general trends during the period under
review. The share of cut-to-length logging of all harvesting increased
particularly in North America and Russia, and this trend is estimated to continue
in the future.
Toward the end of the year, the company will continue to develop its
international distribution network, and boost its competitiveness by
enhancing the effectiveness and expanding the operations of the Vieremä plant.
Consolidated turnover and operating profit for 2005 as a whole are expected to
exceed the previous years figures, due to market prospects and order books.
PONSSE GROUP
PROFIT AND LOSS ACCOUNT (EUR 1,000)
IFRS FAS IFRS IFRS
1-6/05 1-6/04 change 1-6/04
TURNOVER 118,910 89,503 172 89,675
Increase (+)/decrease (-) in stocks of 4,525 2,087 0 2,087
finished goods and work in progress
Other operating income 717 683 0 683
Raw materials and services -81,383 -60,596 64 -60,532
Staff costs -17,431 -13,776 0 -13,776
Depreciation -1,688 -1,324 -206 -1,530
Other operating expenses -10,130 -8,063 0 -8,063
OPERATING PROFIT 13,520 8,514 30 8,544
Share of results of associated 56 58 0 58
companies
Financial income and -285 110 -26 84
expenses
RESULT BEFORE APPROPRIATIONS AND TAXES 13 291 8,682 4 8,686
Income taxes -3,623 -3,101 0 -3,101
Minority interest -103 0 0 0
RESULT FOR THE FINANCIAL 9,565 5,581 4 5,584
PERIOD
PROFIT AND LOSS ACCOUNT (TEUR)
IFRS IFRS IFRS
4-6/05 4-6/04 1-12/04
TURNOVER 59,489 45,716 190,347
Increase (+)/decrease (-) in stocks of 1,467 261 968
finished goods and work in progress
Other operating income 295 312 1,453
Raw materials and services -39,561 -30,182 -126,000
Staff costs -8,997 -7,126 -26,917
Depreciation -857 -771 -3,089
Other operating expenses -5,542 -4,516 -17,062
OPERATING PROFIT 6,294 3,694 19,700
Share of results of associated 39 57 251
companies
Financial income and -315 -104 -778
expenses
RESULT BEFORE APPROPRIATIONS AND TAXES 6,018 3,647 19,173
Income taxes -1,826 -1,415 -5,630
Minority interest -71 107 -11
RESULT FOR THE FINANCIAL 4,121 2,339 13,532
PERIOD
BALANCE SHEET (EUR 1,000)
IFRS FAS IFRS IFRS IFRS
ASSETS 30.6.05 30.6.04 change 30.6.04 31.12.04
FIXED AND OTHER NON-CURRENT
ASSETS
Intangible assets 5,673 1,714 0 1 714 6 250
Tangible assets 20,182 15,474 772 16,246 17,696
Financial assets 52 22 0 22 25
Holdings in associated 885 636 0 636 829
companies
Non-current receivables 106 118 0 118 107
Deferred tax assets 1,182 603 194 796 608
TOTAL FIXED AND OTHER NON- 28,080 18,567 966 19,533 25,515
CURRENT ASSETS
CURRENT ASSETS
Stocks 43,803 35,403 512 35,915 36,109
Trade receivables 18,384 17,047 0 17,047 19,228
Other current receivables 2,037 779 0 779 649
Cash in hand and at banks 12,650 12,935 0 12,935 15,706
TOTAL CURRENT ASSETS 76,874 66,164 512 66,676 71,692
TOTAL ASSETS 104,954 84,731 1,478 86,209 97,207
CAPITAL AND RESERVES AND
LIABILITIES
SHAREHOLDERS EQUITY
Share capital 7,000 3,500 0 3,500 7,000
Share premium account 0 2,545 0 2,545 19
Other reserves 19 17 0 17 0
Retained
earnings 25,414 23,574 -957 22,617 14,893
Profit for the period 9,565 5,581 3 5,584 13,532
Other capital and reserves -518 -534 0 -534 -838
Capital and reserves owned
by parent company 41,480 34,683 -954 33,729 34,606
shareholders
Minority interest 522 0 0 0 419
TOTAL CAPITAL AND RESERVES 42,002 34,683 -954 33,729 35,025
NON-CURRENT CREDITORS
Non-current interest-bearing 23,759 24,317 1,408 25,725 23,937
liabilities
Deferred tax liabilities 598 731 148 879 818
Other non-current creditors 359 120 492 612 336
TOTAL NON-CURRENT CREDITORS 24,716 25,168 2,048 27,216 25,091
CURRENT CREDITORS
Current interest-bearing 2,876 1,977 174 2,151 8,353
liabilities
Trade creditors 16,082 10,140 0 10,140 13,356
Tax liabilities for the 2,463 1,985 0 1,985 2,343
period
Other current creditors 10,774 8,288 209 8,497 8,886
Provisions 6,041 2,490 0 2,490 4,153
TOTAL CURRENT CREDITORS 38,236 24,880 383 25,263 37,091
TOTAL LIABILITIES 62,952 50,048 2,431 52,480 62,182
TOTAL CAPITAL AND RESERVES 104,954 84,731 1,478 86,209 97,207
AND LIABILITIES
CASH FLOW STATEMENT (EUR 1,000)
IFRS IFRS IFRS
1-6/05 1-6/04 1-12/04
BUSINESS OPERATIONS:
Profit for the period 9,565 5,584 13,532
Adjustments:
Financial income and 285 -84 778
expenses
Share of results of associated -56 -58 -251
companies
Depreciation 1,688 1,529 3,089
Deferred taxes -771 -431 -227
Income taxes 4,394 3,534 5,857
Other adjustments 153 31 282
Cash flow before change in working 15,258 10,105 23,060
capital
Change in working capital:
Increase (-)/decrease (+) in current non- -544 -57 -2,145
interest-bearing receivables
Increase ()/decrease (+) in -7,694 -3,584 -3,778
stocks
Increase (+)/decrease () in current non- 4,645 5,067 8,658
interest-bearing creditors
Change in provisions for 1,888 206 1,869
liabilities and charges
Interest received 86 52 227
Interest paid -493 -299 -661
Other financial items 41 378 -312
Income taxes paid -4,216 -2,504 -4,784
NET CASH FLOW FROM BUSINESS 8,971 9,364 22,134
OPERATIONS (A)
INVESTMENTS
Investment in tangible and intangible -3 597 -1,483 -9,029
assets
Investment in other assets 0 0 0
CASH OUTFLOW FROM INVESTING -3,597 -1,483 -9,029
ACTIVITIES (B)
FINANCING
Withdrawal of current loans
Repayment of current loans
.. -5,145 -2,552 3,673
Increase ()/decrease in current interest- 0 40 77
bearing receivables
Withdrawal/repayment of non-current loans -155 11 147 9,444
Payment of finance lease liabilities -332 -246 -269
Increase ()/decrease (+) in non- 2 100 111
current receivables
Paid dividends -2,800 -14,000 -21,000
NET CASH OUTFLOW FROM -8,430 -5,511 -7,964
FINANCING (C)
Increase ()/decrease (+) in -3,056 2,370 5,141
liquid assets (A+B+C)
Liquid assets 1 Jan. 15,706 10,565 10,565
Liquid assets 30 Jun./31 12,650 12,935 15,706
Dec.
RECONCILIATION OF CAPITAL AND RESERVES (EUR 1,000)
30.6.05 30.6.04 31.12.04
Capital and reserves under 42,924 34,683 35,550
FAS
IAS 17 Leases and IAS 18 Revenue -385 -670 -530
IAS 16 Property, Plant and Equipment -841 -841 -841
IAS 2 Inventories 0 512 387
IAS 12 Income Taxes 103 45 40
IFRS 3 Business Combinations: Goodwill -322 0 0
Capital and Reserves under IFRS 41,480 33,729 34,606
RECONCILIATION OF PROFIT FOR THE PERIOD (EUR 1,000)
1-6/05 1-6/04 1-12/04
Profit for the period under FAS 10,066 5,581 13,518
IAS 17 Leases and IAS 18 Revenue 145 135 276
IAS 2 Inventories -387 -131 -256
IAS 12 Income Taxes 63 -1 -6
IFRS 3 Business Combinations: Goodwill -322 0 0
Profit for the period under IFRS 9,565 5,584 13,532
SEGMENT INFORMATION (EUR 1,000)
1-6/05 1-6/04 1-12/04
TURNOVER
Nordic countries 91,747 64,532 132,039
Rest of Europe 31,989 27,804 54,838
North and South America 15,121 13,206 28,263
Inter-segment turnover -20,214 -15,919 -25,289
Unallocated 267 53 496
GROUP TOTAL 118,910 89,676 190,347
1-6/05 1-6/04 1-12/04
OPERATING PROFIT
Nordic countries 10,285 6,038 14,642
Rest of Europe 3,754 2,885 7,049
North and South America 1,200 739 1,864
Unallocated -1,719 -1,118 -3,855
GROUP TOTAL 13,520 8,544 19,700
PLEDGES GIVEN, CONTINGENT AND OTHER LIABILITIES (EUR 1,000)
30.6.05 30.6.04 31.12.04
1. FOR OWN DEBT
Debts for which mortgages have been pledged as
collateral
Loans from credit 0 1,680 1,261
institutions
Mortgages given on land and buildings 790 2,482 1,126
Chattel mortgages given 483 1,547 820
MORTGAGES GIVEN AS PLEDGES, TOTAL 1,273 4,029 1,946
2. LEASING COMMITMENTS 412 498 445
(TEUR)
3. CONTINGENT LIABILITIES ON BEHALF OF GROUP COMPANIES (EUR 1,000)
Guarantees given on behalf of
Group companies 857 1,056 763
4. LIABILITIES ARISING FROM DERIVATIVE CONTRACTS (EUR 1,000)
4.1 Nominal values
Currency derivatives
Options 0 5,480 0
Forward contracts 19,644 8,958 10,616
4.2 Market values
Currency derivatives
Options 0 24 0
Forward contracts -477 36 136
5. OTHER CONTINGENT LIABILITIES (EUR 1,000)
Guarantees given on others 333 660 831
behalf
Repurchase commitments 6,814 8,291 7,521
Other liabilities 0 0 0
Total 7,147 8,951 8,352
KEY INDICATORS 30.6.05 30.6.04 31.12.04
R&D expenditure, MEUR 2.3 1.6 3.7
Fixed-asset investments, MEUR 3.6 1.5 9.0
% of turnover 3.02 1.65 4.74
Average number of staff 701 595 607
Order stock, MEUR 41.1 38.7 44.4
Equity ratio, % 40.0 39.4 36.1
Earnings per share (EPS), 0.68 0.40 0.97
EUR
Equity per share, EUR 2.96 2.41 2.47
Taxes corresponding to profit for the financial period have been included as
income taxes in the Profit and Loss Account and in earnings per share.
NEW ORDERS (MEUR) 1-6/05 1-6/04 1-12/04
Ponsse Group 115.9 95.3 201.7
Data in this interim report are based on unaudited figures.
Since the above figures have been rounded, they may differ from those given in
the official financial statements.
Vieremä, 20 July 2005
Arto Tiitinen
President and CEO
FOR MORE INFORMATION, PLEASE CONTACT:
Arto Tiitinen, President and CEO, tel. +358 (0)20 768 4621 or +358 (0)400 566 875
Mikko Paananen, CFO, tel. +358 (0)20 768 8648 or +358 (0)400 817 036
www.ponsse.com
DISTRIBUTION
Helsinki Stock Exchange
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