PONSSE?S IFRS-COMPLIANT INTERIM REPORT FOR 1 JANUARY - 30 SEPTEMBER 2005
PONSSE OYJ STOCK EXCHANGE RELEASE 19 OCTOBER 2005, 9.00 a.m.
PONSSES IFRS-COMPLIANT INTERIM REPORT FOR 1 JANUARY - 30 SEPTEMBER 2005
- Consolidated turnover: EUR 166.8 million (Q1-Q3/2004: EUR 130.7 million)
- Q3 consolidated turnover: EUR 47.9 million (Q3/2004: EUR 41.0 million)
- Exports and foreign business operations accounted for 64.1% of turnover
(Q1-Q3/2004: 60.9%)
- Operating profit: EUR 19.5 million (Q1-Q3/2004: EUR 13.2 million)
- Operating profit accounted for 11.7% of turnover (Q1-Q3/2004: 10.1%)
- Q3 operating profit: EUR 6.0 million (Q3/2004: EUR 4.6 million)
- Pre-tax profit: EUR 19.1 million (Q1-Q3/2004: EUR 13.1 million)
- Earnings per share (EPS): EUR 0.97 (EUR 0.61)
- Equity ratio: 44.0% (41.6%)
- Order books: EUR 48.2 million (30 September 2004: EUR 40.7 million)
Arto Tiitinen, President and CEO, states the following:
- During the report period, our businesses made favourable progress, with
growth exceeding the industry average; we recorded a clear improvement in our
profit performance. Our profit for the report period (Q1-Q3/2005) was at the
level reported for 2005 as a whole. Exports showed an improvement in line with
our targets, now accounting for 64 per cent of consolidated turnover.
In Finland, we became the market leader. Our used machine business was lively
during the report period as a result of implemented development projects.
We continued to develop our new subsidiaries businesses as planned.
Similarly,the integration of the Kajaani Information Systems Production with
Epec Oy progressed in line with our targets.
- August and September saw two major partnership agreements, one with
Maaseudun Kone Oy and the other with NAF Neunkirchener Achsenfabrik AG, aimed
at long-term co-operation to ensure Ponsses future competitiveness and
product quality. These partnership agreements will enable an ever-closer
product development co-operation and the utilisation of the latest
technologies for Ponsses products.
- Extending the Vieremä assembly plant and constructing a new customer
service centre progressed according to plan, these new premises being brought
into use towards the end of the year.
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 earlier.
TURNOVER
Consolidated turnover rose by 27.6 per cent year on year, to EUR 166.8 million
(EUR 130.7 million). This highly favourable development was due particularly to
strong growth in sales of new machines and good progress made by the used machine
business.
International business operations accounted for 64.1 per cent (60.9 per cent) of
turnover, while domestic sales represented 35.9 per cent (39.1 per cent) of
turnover.
PROFIT PERFORMANCE
Consolidated operating profit came to EUR 19.5 million (EUR 13.2 million),
up 48.2 per cent from the previous years figure, accounting for 11.7 per cent of
consolidated turnover (10.1 per cent). Return on investment (ROI) stood at 35.2
per cent (28.1 per cent).
The Groups financial income and expenses totalled EUR -0.6 million (EUR -0.2
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 13.5 million (EUR 8.6 million). Earnings per
share were EUR 0.97 (EUR 0.61).
BALANCE SHEET AND FINANCIAL POSITION
On 30 September 2005, the consolidated balance sheet total amounted to EUR 105.0
million (EUR 88.4 million). Interest-bearing liabilities totalled
EUR 26.9 million (EUR 25.2 million) and net liabilities EUR 19.0 million
(EUR 10.9 million). Equity ratio stood at 44.0 per cent (41.6 per cent).
Cash in hand and at banks came to EUR 8.1 million (EUR 14.5 million).
During the report period, the Groups liquidity remained at a good level,
despite a large-scale investment programme.
Reported cash flow from business operations totalled EUR 8.2 million (EUR 14.8
million), while that from investing activities was EUR -7.6 million (EUR -2.7
million).
ORDER INTAKE AND ORDER BOOKS
The order intake for the period totalled EUR 170.8 million (EUR 138.3 million)
while period-end order books were valued at EUR 48.2 million (EUR 40.7 million).
The order books included dealers minimum purchase commitments, based on previous
practice.
SUBSIDIARIES
In July, Ponsse bought a 92 per cent holding in Lako Oy, based in Turku.
Operating as an independent Ponsse subsidiary, Lako designs, manufactures
and markets heavy harvesting heads for excavator-based and rubber-tyred machines,
which are also suitable for debarking of eucalyptus trees.
CAPITAL EXPENDITURE AND R&D
The report periods most significant capital expenditure came from the extension
of the Iisalmi service centre and the construction of the customer service centre
adjacent to the Vieremä plant. The Company also invested heavily in the
robotisation of its Vieremä plants surface treatment line, the equipment of the
plants new assembly line and production machinery. Ponsse continued to relocate
its functions to Vieremä, as evidenced by its financial management moving to the
Vieremä premises in September.
During the period,capital expenditure totalled EUR 7.6 million (EUR 2.7 million).
R&D expenses totalled during the period EUR 2.9 million (EUR 2.6 million).
At the report periods end, the company launched a harvester head testing
programme in Latin America.
PERSONNEL
The Group had an average staff of 723 (602) during the period and employed 763
(607) personnel at the period-end.
SHARE PERFORMANCE
The trading volume of Ponsse Oyj shares for 1 January-30 September 2005 totalled
1,710,994, accounting for 12.2 per cent of the total number of shares. Share
turnover came to EUR 30.3 million, with the periods lowest and highest per-share
price amounting to EUR 14.50 and EUR 20.28, respectively. On 31 September 2005,
the share closed at EUR 19.00 and the market capitalisation totalled EUR 266.0
million.
PROSPECTS
Total demand in many of Ponsses main markets remained favourable during the
period under review. Pulp and paper mill investments, implemented and in hand, in
Latin America will boost demand for cut-to-length forest machines.
Toward the end of the year, the company will continue to develop its
international distribution network. The second phase involved in the
Vieremä plants extension will begin in early 2006. These investments are aimed
at ensuring the component plants competitiveness and the availability of
components for production and service. Once completed, the investments will
enable the plant to double its production. In light of the profit performance
reported for Q1-Q3/2005 and the size of order books, Ponsse expects to post
a markedly better turnover and operating profit than in 2004.
PONSSE GROUP
CONSOLIDATED PROFIT AND LOSS ACCOUNT (EUR 1,000)
IFRS FAS IFRS IFRS
1-9/05 1-9/04 change 1-9/04
TURNOVER 166,762 130,424 258 130,682
Increase (+)/decrease (-) in stocks of 5,138 2,437 0 2,437
finished goods and work in progress
Other operating income 1,017 1,010 0 1,010
Raw materials and services -111,537 -87,084 26 -87,059
Staff costs -24,581 -19,364 0 -19,364
Depreciation -2,567 -1,995 -309 -2,303
Other operating expenses -14,733 -12,249 0 -12,249
OPERATING PROFIT 19,499 13,178 -24 13,154
Share of results of associated 141 137 0 137
companies
Financial income and -552 -153 -38 -191
expenses
PROFIT BEFORE APPROPRIATIONS AND TAXES 19,088 13,163 -62 13,101
Income taxes -5,390 -4,516 18 -4,498
Minority interest -164 0 0 0
PROFIT FOR THE PERIOD 13,533 8,647 -44 8,603
CONSOLIDATED PROFIT AND LOSS ACCOUNT (EUR 1,000)
IFRS IFRS IFRS
7-9/05 7-9/04 1-12/04
TURNOVER 47,852 41,006 190,347
Increase (+)/decrease (-) in stocks of 613 350 968
finished goods and work in progress
Other operating income 300 326 1,453
Raw materials and services -30,154 -26,529 -125,999
Staff costs -7,151 -5,588 -26,917
Depreciation -879 -774 -3,089
Other operating expenses -4,603 -4,183 -17,063
OPERATING PROFIT 5,978 4,610 19,700
Share of results of associated 86 79 251
companies
Financial income and -267 -275 -778
expenses
PROFIT BEFORE APPROPRIATIONS AND TAXES 5,796 4,414 19,172
Income taxes -1,767 -1,395 -5,630
Minority interest -61 0 -11
PROFIT FOR THE PERIOD 3,969 3,019 13,532
CONSOLIDATED BALANCE SHEET (EUR 1,000)
IFRS FAS IFRS IFRS IFRS
ASSETS 30.9.05 30.09.04 change 30.9.04 31.12.04
FIXED AND OTHER NON-CURRENT
ASSETS
Intangible assets 5,729 1,731 0 1,731 6,250
Tangible assets 22,038 16,039 677 16,716 17,696
Financial assets 1,212 22 0 22 25
Holdings in associated 970 716 0 716 829
companies
Non-current receivables 103 114 0 114 107
Deferred tax assets 1,322 430 174 604 608
TOTAL FIXED AND OTHER NON- 31,374 19,051 851 19,902 25,515
CURRENT ASSETS
CURRENT ASSETS
Stocks 47,544 36,664 376 37,040 36,109
Trade receivables 15,509 15,964 0 15,964 19,228
Other current receivables 2,473 987 0 987 649
Cash in hand and at banks 8,135 14,499 0 14,499 15,706
TOTAL CURRENT ASSETS 73,661 68,114 376 68,490 71,692
TOTAL ASSETS 105,035 87,165 1,227 88,392 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 20 17 0 17 0
Retained
earnings 25,423 23,642 -958 22,684 14,893
Profit for the period 13,533 8,647 -44 8 603 13,532
Other capital and reserves -506 -592 0 -592 -838
Capital and reserves owned
by parent company 45,470 37,759 -1,002 36,757 34,606
shareholders
Minority interest 582 0 0 0 419
TOTAL CAPITAL AND RESERVES 46,052 37,759 -1,002 36,757 35,025
NON-CURRENT CREDITORS
Non-current interest-bearing 23,687 23,345 1,416 24,761 23,937
liabilities
Deferred tax liabilities 612 703 109 812 818
Other non-current creditors 359 121 492 613 336
TOTAL NON-CURRENT CREDITORS 24,658 24,169 2,017 26,186 25,091
CURRENT CREDITORS
Current interest-bearing 3,164 393 88 481 8,353
liabilities
Trade creditors 13,658 12,583 0 12,583 13,356
Tax liabilities for the 2,586 2,462 0 2,462 2,343
period
Other current creditors 9,640 6,594 123 6,717 8,886
Provisions 5,276 3,205 0 3,205 4,153
TOTAL CURRENT CREDITORS 34,325 25,237 212 25,449 37,091
TOTAL LIABILITIES 58,983 49,406 2,229 51,635 62,182
TOTAL CAPITAL AND RESERVES, 105,035 87,165 1,227 88,392 97,207
AND LIABILITIES
CONSOLIDATED CASH FLOW STATEMENT (EUR 1,000)
IFRS IFRS IFRS
1-9/05 1-9/04 1-12/04
BUSINESS OPERATIONS:
Profit for the period 13,533 8,603 13,532
Adjustments:
Financial income and 552 191 778
expenses
Share of results of associated -141 -137 -251
companies
Depreciation 2,567 2,303 3,089
Deferred taxes -853 -304 -227
Income taxes 6,244 4,802 5,857
Other adjustments 221 39 282
Cash flow before change in working 22,123 15,497 23,060
capital
Change in working capital:
Increase (-)/decrease (+) in current non- 1,894 802 -2,145
interest-bearing receivables
Increase (-) / decrease (+) -11,435 -4,709 -3,778
in stocks
Increase (+) / decrease (-) in current non- 1,202 5,882 8,658
interest-bearing creditors
Change in provisions for 1,123 921 1,869
liabilities and charges
Interest received 131 71 227
Interest paid -809 -601 -661
Other financial items -63 235 -312
Income taxes paid -5,950 -3,295 -4,784
NET CASH FLOW FROM BUSINESS 8,216 14,803 22,134
OPERATIONS (A)
INVESTMENTS
Investment in tangible and intangible -6,388 -2,744 -9,029
assets
Investment in other assets -1,187 0 0
CASH OUTFLOW FROM INVESTING -7,575 -2,744 -9,029
ACTIVITIES (B)
FINANCING
Withdrawal of current loans
Repayment of current
loans -4,698 -4,103 3,673
Increase (-) / decrease (+) in current interest- 0 56 77
bearing receivables
Withdrawal / repayment of non-current loans -227 10,183 9,444
Payment of finance lease liabilities -491 -365 -269
Increase (-) / decrease (+) in non- 4 104 111
current receivables
Paid dividends - 2,800 -14,000 -21,000
NET CASH OUTFLOW FROM -8,212 -8,125 -7,964
FINANCING (C)
Increase (-) / decrease (+) -7,571 3,934 5,141
in liquid assets (A+B+C)
Liquid assets 1 Jan. 15,706 10,565 10,565
Liquid assets 30 Sept. / 31 8,135 14,499 15,706
Dec.
RECONCILIATION OF CAPITAL AND RESERVES (EUR 1,000)
30.9.05 30.9.04 31.12.04
Capital and reserves under 46,889 37,759 35,550
FAS
IAS 17 Leases and IAS 18 Revenue -316 -600 -530
IAS 16 Property, Plant and Equipment -841 -841 -841
IAS 2 Inventories 0 376 387
IAS 12 Income Taxes 85 63 40
IFRS 3 Business Combinations: Goodwill -347 0 0
Capital and reserves under IFRS 45,470 36,757 34,606
RECONCILIATION OF PROFIT FOR THE PERIOD (EUR 1,000)
Q1-3/05 Q1-3/04 2004
Profit for the period under FAS 14,009 8,647 13,518
IAS 17 Leases and IAS 18 Revenue 214 205 276
IAS 2 Inventories -387 -267 -256
IAS 12 Income Taxes 45 18 -6
IFRS 3 Business Combinations: Goodwill -347 0 0
Profit for the period under IFRS 13,533 8,603 13,532
SEGMENT INFORMATION (EUR 1,000)
1-9/05 1-9/04 1-12/04
TURNOVER
Nordic countries 124,464 94,344 132,039
Rest of Europe 45,128 38,189 54,838
North and South America 25,213 17,976 28,263
Inter-segment turnover -28,729 -20,035 -25,289
Unallocated 686 208 496
GROUP TOTAL 166,762 130,682 190,347
1-9/05 1-9/04 1-12/04
OPERATING PROFIT
Nordic countries 13,744 11,140 14,642
Rest of Europe 5,454 3,595 7,049
North and South America 1,697 827 1,864
Unallocated -1,396 -2,408 -3,855
GROUP TOTAL 19,499 13,154 19,700
PLEDGES GIVEN, CONTINGENT AND OTHER LIABILITIES (EUR 1,000)
30.9.05 30.9.04 31.12.04
1. FOR OWN DEBT
Debts for which mortgages have been pledged as
collateral
Loans from financial 0 1,261 1,261
institutions
Mortgages given on land and buildings 790 1,655 1,126
Chattel mortgages given 483 1,009 820
MORTGAGES GIVEN AS PLEDGES, TOTAL 1,273 2,664 1,946
2. LEASING COMMITMENTS (EUR 443 451 445
1,000)
3. CONTINGENT LIABILITIES ON BEHALF OF GROUP COMPANIES (EUR 1,000)
Guarantees given on behalf of Group
Group companies 860 1,041 763
4. LIABILITIES BASED ON DERIVATIVE CONTRACTS (EUR 1,000)
4.1 Nominal values
Currency derivatives
Options 0 5,257 0
Forward contracts 16,162 7,392 10,616
4.2 Market values
Currency derivatives
Options 0 37 0
Forward contracts -281 82 136
5. OTHER CONTINGENT LIABILITIES (EUR 1,000)
Guarantees given on others 1,105 566 830
behalf
Repurchase commitments 8,735 8,293 7,851
Other liabilities 0 0 0
Total 9,840 8,859 8,681
KEY FIGURES AND RATIOS 30.9.05 30.9.04 31.12.04
R&D expenditure, MEUR 2.9 2.6 3.7
Capital expenditure, MEUR 7.6 2.7 9.0
% of turnover 4.5 2.1 4.7
Average number of staff 723 602 607
Order books, MEUR 48.2 40.7 44.4
Equity ratio, % 44.0 41.6 36.1
Earnings per share, EUR 0.97 0.61 0.97
Equity per share, EUR 3.25 2.63 2.47
Income taxes based on profit for the period are included in the Profit and Loss
Account and earnings per share.
ORDER INTAKE (MEUR) 1-9/05 1-9/04 1-12/04
Ponsse Group 170.8 138.3 201.7
Data in this interim report are based on unaudited figures.
Since the above tables are based on rounded figures, they may differ from those
given in the official financial statements.
Vieremä, 19 October 2005
PONSSE OYJ
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
DISTRIBUTION
Helsinki Stock Exchange
Major media
www.ponsse.com
