Stora Enso’s historical figures according to IFRS 11 Joint Arrangements
STORA ENSO OYJ STOCK EXCHANGE RELEASE 19 March 2014 at 9.00 EET
Stora Enso adopted the new IFRS 11 Joint Arrangements as of 1 January 2014. The change affects the accounting treatment of Montes del Plata and Veracel which are now treated as joint operations and thus Stora Enso’s 50% ownership is consolidated with the line-by-line method. Previously these two entities were consolidated using the equity method.
The line by line consolidation of Stora Enso’s 50% ownership of Montes del Plata and Veracel has no impact on published operational EBIT, net profit, equity or earnings per share. The line by line consolidation impacts all the primary statements in the consolidated financial statements. The impacts are summarised below:
- Increase in operational EBITDA
- Increase in property, plant and equipment, biological assets and net debt
- Decrease in equity accounted investment
- Increase in capital expenditure and decreases in equity injections to equity accounted investments.
Historical figures according to the new standard are presented in the tables below. Additionally, the Group has revised the presentation of the cash flow statement to reflect better the underlying cash movements.
CTA = Cumulative Translation Adjustment, EAI = Equity Accounted Investments, NCI = Non-controlling Interests,
NRI = Non-recurring Items, OCI = Other Comprehensive Income
Effects of Changes to IFRS 11 Joint Arrangements
| Restated | Change | As published | ||||||
| EUR million | 2013 | 2012 | 2013 | 2012 | 2013 | 2012 | ||
| Sales | 10 563 | 10 837 | 19 | 22 | 10 544 | 10 815 | ||
| Operational EBITDA | 1 090 | 1 154 | 46 | 60 | 1 044 | 1 094 | ||
| Operational EBIT | 578 | 630 | - | - | 578 | 630 | ||
| Operating profit (IFRS) | 50 | 716 | 16 | 15 | 34 | 701 | ||
| Net profit/loss for the period | -71 | 490 | - | - | -71 | 490 | ||
| Capital expenditure | 760 | 1 012 | 335 | 456 | 425 | 556 | ||
| Depreciation and impairment charges excl. NRI | 603 | 623 | 39 | 40 | 564 | 583 | ||
| Operational ROCE, % | 6.5 | 6.9 | -0.6 | -0.4 | 7.1 | 7.3 | ||
| Return on equity (ROE), % | -1.3 | 8.3 | - | - | -1.3 | 8.3 | ||
| Debt/equity ratio | 0.61 | 0.58 | 0.14 | 0.10 | 0.47 | 0.48 | ||
| Net debt/last twelve months’ operational EBITDA | 2.9 | 2.9 | 0.6 | 0.4 | 2.3 | 2.5 | ||
| Equity ratio, % | 39.2 | 41.0 | -2.1 | -1.8 | 41.3 | 42.8 | ||
| Capital structure | ||||||||
| Operative fixed assets | 6 824 | 7 520 | 1 590 | 1 498 | 5 234 | 6 022 | ||
| Equity accounted investments | 1 013 | 941 | -948 | -1 024 | 1 961 | 1 965 | ||
| Operative working capital, net | 1 179 | 1 526 | 94 | 66 | 1 085 | 1 460 | ||
| Non-current interest-free items, net | -466 | -551 | 33 | 60 | -499 | -611 | ||
| Operating Capital Total | 8 550 | 9 436 | 769 | 600 | 7 781 | 8 836 | ||
| Net tax liabilities | -86 | -237 | -12 | -20 | -74 | -217 | ||
| Capital Employed | 8 464 | 9 199 | 757 | 580 | 7 707 | 8 619 | ||
| Equity attributable to owners of the Parent | 5 213 | 5 770 | - | - | 5 213 | 5 770 | ||
| Non-controlling interests | 60 | 92 | - | - | 60 | 92 | ||
| Net interest-bearing liabilities | 3 191 | 3 337 | 757 | 580 | 2 434 | 2 757 | ||
| Financing Total | 8 464 | 9 199 | 757 | 580 | 7 707 | 8 619 | ||
Key Figures – Restated
| EUR million | 2013 | Q4/13 | Q3/13 | Q2/13 | Q1/13 | 2012 |
| Sales | 10 563 | 2 612 | 2 553 | 2 726 | 2 672 | 10 837 |
| Operational EBITDA | 1 090 | 260 | 319 | 257 | 254 | 1 154 |
| Operational EBITDA margin, % | 10.3 | 10.0 | 12.5 | 9.4 | 9.5 | 10.6 |
| Operational EBIT | 578 | 152 | 184 | 124 | 118 | 630 |
| Operational EBIT margin, % | 5.5 | 5.8 | 7.2 | 4.5 | 4.4 | 5.8 |
| Operating profit (IFRS) | 50 | -210 | 156 | 83 | 21 | 716 |
| Operating margin (IFRS), % | 0.5 | -8.0 | 6.1 | 3.0 | 0.8 | 6.6 |
| Profit before tax excl. NRI | 350 | 111 | 126 | 57 | 56 | 314 |
| Loss/profit before tax | -189 | -281 | 103 | 24 | -35 | 478 |
| Net profit for the period excl. NRI | 323 | 118 | 104 | 45 | 56 | 263 |
| Net loss/profit for the period | -71 | -160 | 84 | 21 | -16 | 490 |
| Capital expenditure | 760 | 278 | 168 | 184 | 130 | 1 012 |
| Depreciation and impairment charges excl. NRI | 603 | 136 | 157 | 154 | 156 | 623 |
| Operational ROCE, % | 6.5 | 7.0 | 8.3 | 5.4 | 5.1 | 6.9 |
| Earnings per share (EPS) excl. NRI, EUR | 0.40 | 0.15 | 0.13 | 0.05 | 0.07 | 0.33 |
| EPS (basic), EUR | -0.07 | -0.18 | 0.11 | 0.02 | -0.02 | 0.61 |
| Cash earnings per share (CEPS) excl. NRI, EUR | 1.16 | 0.31 | 0.33 | 0.25 | 0.27 | 1.13 |
| CEPS, EUR | 1.21 | 0.46 | 0.31 | 0.21 | 0.23 | 1.35 |
| Return on equity (ROE), % | -1.3 | -11.9 | 6.2 | 1.5 | -1.1 | 8.3 |
| Debt/equity ratio | 0.61 | 0.61 | 0.64 | 0.68 | 0.61 | 0.58 |
| Net debt/last twelve months’ operational EBITDA | 2.9 | 2.9 | 3.1 | 3.2 | 3.1 | 2.9 |
| Equity per share, EUR | 6.61 | 6.61 | 6.82 | 6.67 | 7.32 | 7.32 |
| Equity ratio, % | 39.2 | 39.2 | 39.2 | 38.7 | 40.7 | 41.0 |
| Average number of employees | 28 921 | 28 453 | 28 997 | 29 357 | 28 887 | 29 385 |
Reconciliation of Operational Profitability – Restated
| EUR million | 2013 | Q4/13 | Q3/13 | Q2/13 | Q1/13 | 2012 |
| Operational EBITDA | 1 090 | 260 | 319 | 257 | 254 | 1 154 |
| Equity accounted investments (EAI), operational | 91 | 28 | 22 | 21 | 20 | 99 |
| Depreciation and impairment excl. NRI | -603 | -136 | -157 | -154 | -156 | -623 |
| Operational EBIT | 578 | 152 | 184 | 124 | 118 | 630 |
| Fair valuations and non-operational items | 11 | 30 | -5 | -8 | -6 | -44 |
| Non-recurring items | -539 | -392 | -23 | -33 | -91 | 130 |
| Operating Profit/Loss (IFRS) | 50 | -210 | 156 | 83 | 21 | 716 |
Capital Structure – Restated
| EUR million | 31 Dec 13 | 30 Sep 13 | 30 Jun 13 | 31 Mar 13 | 31 Dec 12 |
| Operative fixed assets | 6 824 | 7 159 | 7 130 | 7 511 | 7 520 |
| Equity accounted investments | 1 013 | 1 003 | 982 | 980 | 941 |
| Operative working capital, net | 1 179 | 1 470 | 1 518 | 1 640 | 1 526 |
| Non-current interest-free items, net | -466 | -534 | -535 | -544 | -551 |
| Operating Capital Total | 8 550 | 9 098 | 9 095 | 9 587 | 9 436 |
| Net tax liabilities | -86 | -196 | -189 | -216 | -237 |
| Capital Employed | 8 464 | 8 902 | 8 906 | 9 371 | 9 199 |
| Equity attributable to owners of the Parent | 5 213 | 5 381 | 5 261 | 5 772 | 5 770 |
| Non-controlling interests | 60 | 86 | 88 | 89 | 92 |
| Net interest-bearing liabilities | 3 191 | 3 435 | 3 557 | 3 510 | 3 337 |
| Financing Total | 8 464 | 8 902 | 8 906 | 9 371 | 9 199 |
Cash Flow – Restated
| EUR million | 2013 | Q4/13 | Q3/13 | Q2/13 | Q1/13 | 2012 |
| Operational EBITDA | 1 090 | 260 | 319 | 257 | 254 | 1 154 |
| NRI on Operational EBITDA | 37 | 154 | -23 | -43 | -51 | 18 |
| Dividends received from EAI | 38 | 18 | 2 | 7 | 11 | 102 |
| Other adjustments | -178 | -168 | 1 | 8 | -19 | -25 |
| Change in working capital | 265 | 198 | 48 | 88 | -69 | 45 |
| Cash Flow from Operations | 1 252 | 462 | 347 | 317 | 126 | 1 294 |
| Cash spent on fixed and biological assets | -740 | -216 | -182 | -170 | -172 | -1 000 |
| Acquisitions of equity accounted investments | -31 | - | -1 | -30 | - | - |
| Cash Flow after Investing Activities | 481 | 246 | 164 | 117 | -46 | 294 |
Condensed Consolidated Income Statement – Restated
| EUR million | 2013 | Q4/13 | Q3/13 | Q2/13 | Q1/13 | 2012 |
| Sales | 10 563 | 2 612 | 2 553 | 2 726 | 2 672 | 10 837 |
| Other operating income | 140 | 34 | 30 | 37 | 39 | 219 |
| Materials and services | -6 550 | -1 488 | -1 585 | -1 765 | -1 712 | -6 890 |
| Freight and sales commissions | -982 | -235 | -237 | -251 | -259 | -1 011 |
| Personnel expenses | -1 390 | -349 | -314 | -368 | -359 | -1 373 |
| Other operating expenses | -644 | -141 | -149 | -165 | -189 | -611 |
| Share of results of equity accounted investments | 102 | 49 | 15 | 13 | 25 | 117 |
| Depreciation and impairment | -1 189 | -692 | -157 | -144 | -196 | -572 |
| Operating Profit/Loss | 50 | -210 | 156 | 83 | 21 | 716 |
| Net financial items | -239 | -71 | -53 | -59 | -56 | -238 |
| Loss/Profit before Tax | -189 | -281 | 103 | 24 | -35 | 478 |
| Income tax | 118 | 121 | -19 | -3 | 19 | 12 |
| Net Loss/Profit for the Period | -71 | -160 | 84 | 21 | -16 | 490 |
Condensed Consolidated Statement of Cash Flows – Restated
| EUR million | 2013 | Q1–Q3/13 | Q1–Q2/13 | Q1/13 | 2012 |
| Cash Flow from Operating Activities | |||||
| Operating profit | 50 | 260 | 104 | 21 | 716 |
| Hedging result from OCI | 7 | - | 10 | -1 | -2 |
| Adjustments for non-cash items | 937 | 463 | 320 | 174 | 533 |
| Change in net working capital | 265 | 67 | 19 | -69 | 45 |
| Cash Flow Generated by Operations | 1 259 | 790 | 453 | 125 | 1 292 |
| Net financial items paid | -198 | -134 | -86 | -66 | -161 |
| Income taxes paid, net | -46 | -33 | -20 | -3 | -105 |
| Net Cash Provided by Operating Activities | 1 015 | 623 | 347 | 56 | 1 026 |
| Cash Flow from Investing Activities | |||||
| Acquisitions of subsidiaries and business operations, net of acquired cash | 25 | - | - | - | -11 |
| Acquisitions of equity accounted investments | -31 | -31 | -30 | - | - |
| Acquisitions of available-for-sale investments | -9 | -9 | -9 | - | - |
| Proceeds from sale of fixed assets and shares, net of disposed cash | 96 | 87 | 81 | 18 | 11 |
| Proceeds from disposal of available-for-sale investments | 42 | 43 | - | - | - |
| Capital expenditure | -740 | -524 | -342 | -172 | -1 000 |
| Proceeds from/payments of non-current receivables, net | 85 | 107 | 98 | 2 | -4 |
| Net Cash Used in Investing Activities | -532 | -327 | -202 | -152 | -1 004 |
| Cash Flow from Financing Activities | |||||
| Proceeds from issue of new long-term debt | 239 | 223 | 66 | - | 1 766 |
| Long-term debt, payments | -415 | -189 | -44 | -39 | -604 |
| Change in short-term borrowings | 108 | 131 | 47 | -15 | -155 |
| Dividends paid | -237 | -237 | -237 | - | -237 |
| Dividend to non-controlling interests | -7 | -6 | -6 | -7 | -3 |
| Net Cash Used in/Provided by Financing Activities | -312 | -78 | -174 | -61 | 767 |
| Net Increase/Decrease in Cash and Cash Equivalents | 171 | 218 | -29 | -157 | 789 |
| Translation adjustment | -27 | -16 | -20 | 3 | -28 |
| Net cash and cash equivalents at the beginning of period | 1 917 | 1 917 | 1 917 | 1 917 | 1 156 |
| Net Cash and Cash Equivalents at Period End | 2 061 | 2 119 | 1 868 | 1 763 | 1 917 |
| Cash and Cash Equivalents at Period End | 2 073 | 2 121 | 1 869 | 1 764 | 1 921 |
| Bank Overdrafts at Period End | -12 | -2 | -1 | -1 | -4 |
| Net Cash and Cash Equivalents at Period End | 2 061 | 2 119 | 1 868 | 1 763 | 1 917 |
Condensed Consolidated Statement of Financial Position – Restated
| EUR million | 31 Dec 13 | 30 Sep 13 | 30 Jun 13 | 31 Mar 13 | 31 Dec 12 | |
| Assets | ||||||
| Non-current Assets | ||||||
| PPE*, goodwill and other intangible assets | O | 5 808 | 6 332 | 6 370 | 6 573 | 6 565 |
| Biological assets | O | 634 | 454 | 466 | 496 | 474 |
| Emission rights | O | 21 | 18 | 15 | 35 | 30 |
| Equity accounted investments | O | 1 013 | 1 003 | 982 | 980 | 941 |
| Available-for-sale: Interest-bearing | I | 10 | 10 | 105 | 100 | 96 |
| Available-for-sale: Operative | O | 361 | 355 | 279 | 407 | 451 |
| Non-current loan receivables | I | 80 | 79 | 37 | 137 | 134 |
| Deferred tax assets | T | 229 | 165 | 162 | 169 | 143 |
| Other non-current assets | O | 63 | 70 | 69 | 80 | 85 |
| 8 219 | 8 486 | 8 485 | 8 977 | 8 919 | ||
| Current Assets | ||||||
| Inventories | O | 1 445 | 1 515 | 1 510 | 1 610 | 1 510 |
| Tax receivables | T | 13 | 14 | 15 | 18 | 18 |
| Operative receivables | O | 1 555 | 1 676 | 1 787 | 1 851 | 1 714 |
| Interest-bearing receivables | I | 147 | 137 | 151 | 196 | 211 |
| Cash and cash equivalents | I | 2 073 | 2 121 | 1 869 | 1 764 | 1 921 |
| 5 233 | 5 463 | 5 332 | 5 439 | 5 374 | ||
| Total Assets | 13 452 | 13 949 | 13 817 | 14 416 | 14 293 | |
| Equity and Liabilities | ||||||
| Owners of the Parent | 5 213 | 5 381 | 5 261 | 5 772 | 5 770 | |
| Non-controlling Interests | 60 | 86 | 88 | 89 | 92 | |
| Total Equity | 5 273 | 5 467 | 5 349 | 5 861 | 5 862 | |
| Non-current Liabilities | ||||||
| Post-employment benefit provisions | O | 378 | 465 | 461 | 470 | 480 |
| Other provisions | O | 127 | 124 | 133 | 145 | 145 |
| Deferred tax liabilities | T | 312 | 331 | 337 | 361 | 358 |
| Non-current debt | I | 4 163 | 4 333 | 4 260 | 4 817 | 4 799 |
| Other non-current operative liabilities | O | 24 | 15 | 10 | 9 | 11 |
| 5 004 | 5 268 | 5 201 | 5 802 | 5 793 | ||
| Current Liabilities | ||||||
| Current portion of non-current debt | I | 544 | 644 | 732 | 221 | 202 |
| Interest-bearing liabilities | I | 794 | 805 | 727 | 669 | 698 |
| Operative liabilities | O | 1 821 | 1 721 | 1 779 | 1 821 | 1 698 |
| Tax liabilities | T | 16 | 44 | 29 | 42 | 40 |
| 3 175 | 3 214 | 3 267 | 2 753 | 2 638 | ||
| Total Liabilities | 8 179 | 8 482 | 8 468 | 8 555 | 8 431 | |
| Total Equity and Liabilities | 13 452 | 13 949 | 13 817 | 14 416 | 14 293 |
* PPE = Property, Plant and Equipment
Items designated with “O” comprise Operating Capital
Items designated with “I” comprise Interest-bearing Net Liabilities
Items designated with “T” comprise Net Tax Liabilities
For further information, please contact:
Seppo Parvi, CFO, tel. +358 2046 21205
Ulla Paajanen-Sainio, SVP, Investor Relations, tel. +358 2046 21242
www.storaenso.com
www.storaenso.com/investors
Stora Enso is the global rethinker of the paper, biomaterials, wood products and packaging industry. We always rethink the old and expand to the new to offer our customers innovative solutions based on renewable materials. Stora Enso employs some 28 000 people worldwide, and our sales in 2013 amounted to EUR 10.5 billion. Stora Enso shares are listed on NASDAQ OMX Helsinki (STEAV, STERV) and Stockholm (STE A, STE R). In addition, the shares are traded in the USA as ADRs (SEOAY) in the International OTCQX over-the-counter market.
STORA ENSO OYJ
For further information, please contact:
Seppo Parvi
CFO
tel. +358 2046 21205
Ulla Paajanen-Sainio
SVP, Investor Relations
tel. +358 2046 21242