TELESTE CORPORATION INTERIM REPORT 1 JAN TO 30 JUNE 2013
TELESTE CORPORATION INTERIM REPORT 8.8.2013 AT 08:30
TELESTE CORPORATION INTERIM REPORT 1 JAN TO 30 JUNE 2013
YEAR-ON-YEAR OPERATING PROFIT FELL, PROFITABILITY OF OUR PRODUCT BUSINESS IMPROVED
Q2 of 2013
- Net sales amounted to EUR 46.5 (49.7) million, a decrease of 6.4%
- Operating profit stood at EUR 1.7 (2.4) million, a decrease of 28.2%
- Undiluted result per share stood at EUR 0.07 (0.07)
- Orders received totaled EUR 44.2 (49.2) million, a decrease of 10.1%
- Operating cash flow was EUR 4.1 (5.5) million
Outlook for 2013
We expect net sales and operating profit for 2013 to reach the 2012 level.
Comments on Q2 of 2013 by CEO Jukka Rinnevaara:
"Network investments of our Video and Broadband Solutions business were slowed down by the operators' on-going significant consolidations as well as comparisons between future network technologies. Net sales increased on account of the Asheridge acquisition made at the beginning of April 2013. The year-on-year operating profit improved mainly due to the good level of deliveries in video surveillance.
The decline in Network Services' net sales and the operating profit being in the red were caused by the lower demand of services in Germany. We expect the current adjustment of cost structure in Germany to improve profitability as early as in the third quarter of this year.”
Group Operations in April to June 2013
| Key figures (EUR million) | 4-6/2013 | 4-6/2012 | Change % |
| Orders received | 44.2 | 49.2 | -10.1% |
| Net sales | 46.5 | 49.7 | -6.4% |
| EBIT | 1.7 | 2.4 | -28.2% |
| EBIT % | 3.7% | 4.9% | |
| Profit for the period | 1.3 | 1.2 | 5.1% |
| Other important key figures | |||
| Earnings per share, EUR | 0.07 | 0.07 | 4.7% |
| Cash flow from operations, EUR million | 4.1 | 5.5 | -24.9% |
Orders received by the Group in Q2 totaled EUR 44.2 (49.2) million, a decrease of 10.1%. The year-on-year order backlog decreased by EUR 6.4 million to EUR 12.3 (18.7) million.
Net sales decreased by 6.4% to EUR 46.5 (49.7) million. Compared to the same period in the previous year, operating profit decreased by 28.2% standing at EUR 1.7 (2.4) million, which is 3.7% (4.9%) of net sales. Operating profit of Video and Broadband Solutions increased, whereas that of Network Services was in the red. Wages and salaries stood at EUR 14.5 (15.4) million. Undiluted result per share was EUR 0.07 (0.07). Operating cash flow stood at EUR 4.1 (5.5) million.
Group Operations in January to June 2013
| Key figures (EUR million) | 1-6/2013 | 1-6/2012 | Change % | 1-12/2012 |
| Orders received | 87.6 | 98.3 | -10.9% | 189.7 |
| Net sales | 92.3 | 100.8 | -8.5% | 193.9 |
| EBIT | 4.3 | 5.4 | -19.0% | 10.9 |
| EBIT % | 4.7% | 5.3% | 5.6% | |
| Profit for the period | 3.1 | 3.2 | -5.1% | 6.7 |
| Other important key figures | ||||
| Earnings per share, EUR | 0.18 | 0.18 | -5.1% | 0.38 |
| Cash flow from operations, EUR million | 4.3 | 10.4 | -58.4% | 15.3 |
| Net gearing, % | 21.8% | 21.1% | 3.2% | 13.7% |
| Equity ratio, % | 48.5% | 46.2% | 4.9% | 50.5% |
| Personnel at period-end | 1,325 | 1,348 | -1.7% | 1,325 |
Orders received by the Group decreased by 10.9% and stood at EUR 87.6 (98.3) million. Net sales decreased by 8.5% to EUR 92.3 (100.8) million. Operating profit decreased by 19.0% to EUR 4.3 (5.4) million. Wages and salaries stood at EUR 28.9 (30.5) million. Financial items totaled EUR 0.2 (0.7) million. Financial expenses for the reference period included a one-off write-down of EUR 0.4 million. Taxes for the Group amounted to EUR 1.1 (1.4) million while the Group's tax rate was 26.4% (29.9%). Undiluted result per share was EUR 0.18 (0.18). Operating cash flow stood at EUR 4.3 (10.4) million.
Video and Broadband Solutions in April to June 2013
Economic Development of Video and Broadband Solutions
| 4-6/2013 | 4-6/2012 | Change % | |
| Orders received | 23,350 | 23,790 | -1.8% |
| Net sales | 25,625 | 24,278 | 5.5% |
| EBIT | 2,308 | 1,548 | 49.1% |
| EBIT % | 9.0% | 6.4% |
Orders received totaled EUR 23.4 (23.8) million, a decline of 1.8%. Order backlog totaled EUR 12.3 (18.7) million. Net sales grew by 5.5% amounting to EUR 25.6 (24.3) million. This increase in net sales was brought about by the acquisition of Asheridge conducted in April 2013. Operating profit stood at EUR 2.3 (1.5) million making 9.0% (6.4%) of net sales. This increase in operating profit was brought about by improved materials margin and decreased labor costs.
R&D expenses for the business area amounted to EUR 2.7 (3.0) million making 10.5% (12.4%) of net sales. Projects focused on the next-generation innovative broadband solution (Data Access HUB), access network solutions meeting the requirements set by the future standard of the cable networks (Docsis 3.1), video headend systems (Luminato) and customer projects. Activated R&D expenses amounted to EUR 0.3 (0.0) million. Depreciation on R&D amounted to EUR 0.5 (0.5) million.
Video and Broadband Solutions in January to June 2013
| 1-6/2013 | 1-6/2012 | Change % | 1-12/2012 | |
| Orders received | 44,769 | 50,180 | -10.8% | 97,730 |
| Net sales | 49,438 | 51,777 | -4.5% | 101,230 |
| EBIT | 4,744 | 4,072 | 16.5% | 8,497 |
| EBIT % | 9.6% | 7.9% | 8.4% |
Orders received totaled EUR 44.8 (50.2) million, a decrease of 10.8%. Net sales decreased by 4.5% to EUR 49.4 (51.8) million. Operating profit grew by 16.5% equaling EUR 4.7 (4.1) million. Product development expenses equaled EUR 5.1 (5.9) million, in other words 10.3% (11.4%) of the net sales.
Network Services in April to June 2013
Economic Development of Network Services
| 4-6/2013 | 4-6/2012 | Change % | |
| Orders received | 20,870 | 25,409 | -17.9% |
| Net sales | 20,870 | 25,409 | -17.9% |
| EBIT | -570 | 872 | n/a |
| EBIT % | -2.7% | 3.4% |
Orders received in Q2 totaled EUR 20.9 (25.4) million, a decrease of 17.9%. Net sales decreased by 17.9% to EUR 20.9 (25.4) million. This decrease in net sales was due to a drop in demand for services in Germany. Due to this low net sales in Germany, operating profit was in the red equaling EUR -0.6 (0.9) million, representing -2.7% (3.4%) of net sales. Adjustment of cost structure is in progress in Germany, and profitability will improve gradually as early as in the third quarter of this year.
Network Services in January to June 2013
| 1-6/2013 | 1-6/2012 | Change % | 1-12/2012 | |
| Orders received | 42,816 | 48,140 | -11.1% | 91,931 |
| Net sales | 42,816 | 49,040 | -12.7% | 92,645 |
| EBIT | -404 | 1,285 | n/a | 2,439 |
| EBIT % | -0.9% | 2.6% | 2.6% |
Year-on-year orders received decreased by 11.1% standing at EUR 42.8 (48.1) million. Net sales decreased by 12.7% to EUR 42.8 (49.0) million. Operating profit stood at EUR -0.4 (1.3), which was caused by the low net sales.
Personnel and Organization in January to June 2013
In the period under review, the Group had an annual average of 1,336 people (1,326/2012, 1,279/2011), of whom 554 (565) were employed by Video and Broadband Solutions, and 782 (761) by Network Services. At the end of the review period, the Group had 1,325 (1,348/2012, 1,314/2011) people, of whom 74% (70%/2012, 72%/2011) were working outside Finland. Employees stationed outside Europe accounted for less than 5% of the Group's personnel.
In the fourth quarter of 2012, the parent company Teleste Corporation launched codetermination procedures together with the personnel. Adjustments in the number of employees in Finland were initiated in December 2012 by introducing a rotating temporary layoff. In the second quarter of the year there was no rotating layoff in Finland. This rotating temporary layoff agreed in the codetermination procedures can be extended until March 2014. Wages and salaries stood at EUR 28.9 (30.5/2012, 26.0/2011) million.
Investments and Product Development in January to June 2013
Investments by the Group for the period under review totaled EUR 4.6 (1.7) million accounting for 5.0% (1.7%) of the net sales. EUR 3.5 million of these investments involved the acquisition of Asheridge. Product development investments amounted to EUR 0.6 (0.3) million while other investments equaled EUR 0.5 million. Investments of EUR 0.4 (0.6) million were made under financial lease arrangements.
Financing and Capital Structure in January to June 2013
Operating cash flow stood at EUR 4.3 (10.4) million. This decrease in cash flow from operations from the comparative period was mainly due to reduction in non-interest bearing short-term debt, as well as slowing down in the cycle time of accounts receivable. At the end of the period under review, the amount of unused binding stand-by credits amounted to EUR 14.0 (16.0) million. The credit limits are valid until August 2015.
The Group's equity ratio equaled 48.5% (46.2%) and net gearing 21.8% (21.1%). Interest bearing debt on 30 June 2013 stood at EUR 27.7 (25.1) million.
Key Risks Faced by the Business Areas
Founded in 1954, Teleste is a technology and services company consisting of two business areas: Video and Broadband Solutions and Network Services. With Europe as the main market area, our clients include European cable operators and specified organizations in the public sector.
As to Video and Broadband Solutions, client-specific and integrated deliveries of solutions create favorable conditions for growth, even if the involved resource allocation and technical implementation pose a challenge involving, therefore, also reasonable risks. Our customers' network investments vary based on the relevant need for upgrading and their financial structure. Significant part of Teleste's competition comes from the USA so the exchange rate of euro up against the US dollar affects our competitiveness. The exchange rate development of the Chinese renminbi to euro affects our material costs.
The company hedges against short-term currency exposure by means of forward contracts. The tight financial market in Europe may slow down our customers' investment plans. Furthermore, a weakening in the consumer purchasing power in Europe could slow down the network investments by the cable operators. Availability of components is subject to natural phenomena, such as floods and earthquakes. Severe weather conditions have an impact on the business areas' ability to deliver their products and services. Correct technological choices and their timing are vital for our success.
Net sales of Network Services comes, for the most part, from a small number of large European customers, so a significant change in the demand for our services by any one of them is reflected in the actual deliveries. To ensure quality of services and cost-efficiency along with efficient service process management, customer satisfaction and improvements in productivity require innovative solutions in terms of processes, products and logistics. Smooth operation of cable networks requires effective technical management and functional hardware solutions in accordance with contractual obligations. This, in turn, demands continuous and determined development of skill levels in Teleste's own personnel as well as those of our subcontractors. In addition, our ability to deliver and compete may be constrained by the adequacy of our sub-contractor network capacity. Tender calculation and management of larger projects with overall responsibility are complex and risky.
It is important for our business areas to take into account any market developments such as consolidations taking place among the clientele and competition. The threats to information systems must be minimized to ensure business continuity. The Board of Directors annually reviews any essential risks related to the company operation and their management. Risk management is an integral part of the strategic and operational activities of the business areas. Risks and their probability are reported to the Board in conjunction with regular monthly reports.
The company has covered any major risks of loss involving the business areas through insurance policies. Insurance will also cover credit loss risks related to sales receivables. In the period under review, no such legal proceedings or judicial procedures were pending that would have had any essential significance for the Group operation.
Group Structure
Parent company Teleste has branch offices in Australia, the Netherlands, and Denmark with subsidiaries in 13 countries outside Finland. In April 2013 Teleste Management Oy became a Group company through exchange of shares. Teleste Management II Oy, founded in December 2011, has been consolidated in the Teleste Group figures on account of financial arrangements. Suomen Turvakamera Oy has been merged with Teleste Corporation on 30 April 2013. Asheridge Group has been consolidated with the Group figures as of 7 April 2013.
Shares and Changes in Share Capital
On 30 June 2013, EM Group Oy was the largest single shareholder with a holding of 23.44%.
In the period under review, the lowest company share price was EUR 3.78 (3.04) and the highest was EUR 4.47 (4.44). Closing price on 30 June 2013 stood at EUR 4.09 (3.90). According to Euroclear Finland Ltd the number of shareholders at the end of the period under review was 5,086 (5,060). Foreign ownership accounted for 5.83% (7.83%). From 1 January to 30 June 2013, trading with Teleste share at NASDAQ OMX Helsinki amounted to EUR 5.6 (4.2) million. In the period under review, 1.3 (1.1) million Teleste shares were traded on the stock exchange.
At the end of June 2013, the Group held 1,189,654 of its own shares, of which the parent company Teleste Corporation had 266,654 shares while the Group and controlled companies had 923,000 shares, respectively. At the end of the period, the Group’s holding of the total amount of shares amounted to 6.35% (6.96%).
On 30 June 2013, the registered share capital of Teleste stood at EUR 6,966,932.80 divided in 18,728,590 shares.
The period for subscription of Teleste 2007B options expired on 30 April 2013. No Teleste Corporation shares were subscribed by the specified options in the subscription period. Teleste 2007C options allow for subscription of 280,000 Teleste Corporation shares. The period for subscription of Teleste 2007C options is valid until 30 April 2014. Teleste 2007C options have been listed on NASDAQ OMX Helsinki Oy since 2 April 2012.
Decisions by the Annual General Meeting
The Annual General Meeting (AGM) of Teleste Corporation on 12 April 2013 confirmed the financial statements for 2012 and discharged the Board of Directors and the CEO from liability for the financial period. The AGM confirmed the dividend of EUR 0.17 per share proposed by the Board. The dividend was paid out on 24 April 2013.
Ms. Marjo Miettinen, Mr. Pertti Ervi, Mr. Esa Harju, Mr. Kai Telanne and Mr. Petteri Walldén continue in Teleste's Board of Directors. Jannica Fagerholm was elected new member of the Board of Directors. Pertti Raatikainen's membership of the Board of Directors ended. Ms. Marjo Miettinen was elected Chair of the Board in the organizational meeting held immediately after the AGM.
Authorized Public Accountants KPMG Oy Ab continue as the auditor until the next AGM. Mr. Esa Kailiala, accountant authorized by the Central Chamber of Commerce of Finland, was chosen auditor-in-charge.
Valid authorizations granted by the AGM:
- Authorization to purchase own shares: 1,400,000
- Disposal of own shares: 1,779,985, valid until the 2014 Annual General Meeting
- Issue of new shares: 5,000,000, valid until the 2014 Annual General Meeting
- Pursuant to the special rights granted by the company, the maximum number of shares is 2,500,000; these special rights are included in the authorization to issue 5,000,000 new shares.
In the period under review, 113,331 treasury shares were conveyed in the exchange of shares related to Teleste Management Oy.
Outlook for 2013
Network capacity will continue to increase driven by the new video services provided by the operators. However, comparisons made by the operators concerning the future access network technologies could delay the launch of investments. We estimate profitability of Video and Broadband Solutions to improve over the comparative period.
We estimate profitability of Network Services to remain below the comparative period.
We expect net sales and operating profit for 2013 to reach the 2012 level.
7 August 2013
Teleste Corporation Jukka Rinnevaara
Board of Directors President and CEO
This interim report has been compiled in compliance with IAS 34, as it is accepted within EU, using the recognition and valuation principles with those used in the Annual Report. Teleste has prepared this interim report applying the same accounting principles as those described in detail in its 2012 consolidated financial statements. The data stated in this report is unaudited.
| STATEMENT OF COMPREHENSIVE INCOME (tEUR) | 4-6/ 2013 | 4-6/ 2012 | Change % | 1-12/ 2012 | |
| Net Sales | 46,495 | 49,687 | -6.4 % | 193,875 | |
| Other operating income | 0 | 456 | n/a | 1,150 | |
| Materials and services | -21,997 | -24,544 | -10.4 % | -94,747 | |
| Personnel expenses | -14,455 | -15,417 | -6.2 % | -58,511 | |
| Other operating expenses | -7,144 | -6,608 | 8.1 % | -25,753 | |
| Depreciation | -1,161 | -1,154 | 0.6 % | -5,078 | |
| Operating profit | 1,738 | 2,420 | -28.2 % | 10,936 | |
| Financial income and expenses | -103 | -624 | -83.5 % | -821 | |
| Profit after financial items | 1,635 | 1,796 | -9.0 % | 10,115 | |
| Profit before taxes | 1,635 | 1,796 | -9.0 % | 10,115 | |
| Taxes | -364 | -587 | -38.0 % | -3,412 | |
| Net profit | 1,271 | 1,209 | 5.1 % | 6,703 | |
| Attributable to: | |||||
| Equity holders of the parent | 1,271 | 1,209 | 5.1 % | 6,703 | |
| Earnings per share for result of the year attributable to the equity holders of the parent | |||||
| (expressed in € per share) | |||||
| Basic | 0.07 | 0.07 | 4.7 % | 0.38 | |
| Diluted | 0.07 | 0.07 | 4.6 % | 0.38 | |
| Total comprehensive income for the period (tEUR) | |||||
| Net profit | 1,271 | 1,209 | 5.1 % | 6,703 | |
| Possible items with future net profit effect | |||||
| Translation differences | -516 | 88 | n/a | 631 | |
| Fair value reserve | 27 | 70 | -61.4 % | 144 | |
| Total comprehensive income for the period | 782 | 1,367 | -42.8 % | 7,478 | |
| Attributable to: | |||||
| Equity holders of the parent | 782 | 1,367 | -42.8 % | 7,478 | |
| STATEMENT OF COMPREHENSIVE INCOME (tEUR) | 1-6/ 2013 | 1-6/ 2012 | Change % | 1-12/ 2012 | ||
| Net Sales | 92,254 | 100,817 | -8.5 % | 193,875 | ||
| Other operating income | 458 | 788 | -41.9 % | 1,150 | ||
| Materials and services | -43,601 | -50,398 | -13.5 % | -94,747 | ||
| Personnel expenses | -28,890 | -30,501 | -5.3 % | -58,511 | ||
| Other operating expenses | -13,369 | -12,818 | 4.3 % | -25,753 | ||
| Depreciation | -2,512 | -2,531 | -0.8 % | -5,078 | ||
| Operating profit | 4,340 | 5,357 | -19.0 % | 10,936 | ||
| Financial income and expenses | -185 | -761 | -75.7 % | -821 | ||
| Profit after financial items | 4,155 | 4,596 | -9.6 % | 10,115 | ||
| Profit before taxes | 4,155 | 4,596 | -9.6 % | 10,115 | ||
| Taxes | -1,097 | -1,374 | -20.2 % | -3,412 | ||
| Net profit | 3,058 | 3,222 | -5.1 % | 6,703 | ||
| Attributable to: | ||||||
| Equity holders of the parent | 3,058 | 3,222 | -5.1 % | 6,703 | ||
| Earnings per share for result of the year attributable to the equity holders of the parent (expressed in € per share) | ||||||
| Basic | 0.18 | 0.18 | -5.1 % | 0.38 | ||
| Diluted | 0.17 | 0.18 | -5.1 % | 0.38 | ||
| Total comprehensive income for the period (tEUR) | ||||||
| Net profit | 3,058 | 3,222 | -5.1 % | 6,703 | ||
| Possible items with future net profit effect | ||||||
| Translation differences | -471 | 357 | -231.9 % | 631 | ||
| Fair value reserve | 51 | 84 | -39.3 % | 144 | ||
| Total comprehensive income for the period | 2,638 | 3,663 | -28.0 % | 7,478 | ||
| Attributable to: | ||||||
| Equity holders of the parent | 2,638 | 3,663 | -28.0 % | 7,478 | ||
| STATEMENT OF FINANCIAL POSITION (tEUR) | 30.06.2013 | 30.06.2012 | Change % | 31.12.2012 | |
| Non-current assets | |||||
| Property,plant,equipment | 10,637 | 10,111 | 5.2 % | 10,127 | |
| Goodwill | 33,301 | 31,174 | 6.8 % | 31,350 | |
| Other intangible assets | 4,567 | 5,079 | -10.1 % | 4,174 | |
| Deferred tax assets | 2,079 | 1,725 | 20.5 % | 2,086 | |
| Available-for-sale investments | 286 | 287 | -0.3 % | 294 | |
| 50,870 | 48,376 | 5.2 % | 48,031 | ||
| Current assets | |||||
| Inventories | 20,295 | 21,615 | -6.1 % | 19,495 | |
| Trade and other receivables | 38,546 | 39,364 | -2.1 % | 38,811 | |
| Cash and cash equivalents | 14,570 | 13,169 | 10.6 % | 13,880 | |
| 73,411 | 74,148 | -1.0 % | 72,186 | ||
| Total assets | 124,280 | 122,523 | 1.4 % | 120,217 | |
| Shareholder's equity and liabilities | |||||
| Share capital | 6,967 | 6,967 | 0.0 % | 6,967 | |
| Other equity | 52,840 | 48,873 | 8.1 % | 52,912 | |
| Non-controlling interest | 425 | 715 | -40.6 % | 678 | |
| 60,232 | 56,555 | 6.5 % | 60,557 | ||
| Non-current liabilities | |||||
| Provisions | 968 | 605 | 60.0 % | 503 | |
| Deferred tax liabilities | 1,794 | 1,850 | -3.0 % | 1,297 | |
| Non interest bearing liabilities | 2,342 | 3,394 | -31.0 % | 22 | |
| Interest-bearing liabilities | 1,102 | 12,315 | -91.1 % | 788 | |
| 6,206 | 18,164 | -65.8 % | 2,610 | ||
| Current liabilities | |||||
| Trade payables and other liabilities | 30,142 | 33,011 | -8.7 % | 32,612 | |
| Current tax payable | 245 | 785 | -68.8 % | 2,075 | |
| Provisions | 848 | 1,211 | -30.0 % | 1,004 | |
| Interest-bearing liabilities | 26,607 | 12,797 | 107.9 % | 21,360 | |
| 57,842 | 47,804 | 21.0 % | 57,051 | ||
| Total shareholder's equity and liabilities | 124,280 | 122,523 | 1.4 % | 120,217 | |
| CONSOLIDATED CASH FLOW STATEMENT (tEUR) | 1-6/ 2013 | 1-6/ 2012 | Change % | 1-12/ 2012 | |
| Cash flows from operating activities | |||||
| Profit for the period | 3,058 | 3,222 | -5.1 % | 6,703 | |
| Adjustments | 3,794 | 4,720 | -19.6 % | 9,110 | |
| Interest and other financial expenses and incomes | -185 | -338 | -45.3 % | -397 | |
| Paid Taxes | -2,927 | -1,587 | 84.4 % | -4,290 | |
| Change in working capital | 588 | 4,398 | -86.6 % | 4,171 | |
| Cash flow from operating activities | 4,328 | 10,415 | -58.4 % | 15,297 | |
| Cash flow from investing activities | |||||
| Acquisition of subsidiary, net of cash acquired | -3,541 | -580 | 510.6 % | -828 | |
| Purchases of property, plant and equipment (PPE) | -400 | -961 | -58.4 % | -1,110 | |
| Purchases of intangible assets | -586 | -280 | 109.3 % | -844 | |
| Net cash used in investing activities | -4,527 | -1,821 | 148.6 % | -2,782 | |
| Cash flow from financing activities | |||||
| Proceeds from borrowings | 5,000 | 0 | n/a | 0 | |
| Payments of borrowings | -821 | -8,746 | -90.6 % | -11,821 | |
| Dividends paid | -2,962 | -2,440 | 21.4 % | -2,440 | |
| Net cash used in financing activities | 1,217 | -11,186 | n/a | -14,261 | |
| Change in cash | |||||
| Cash in the beginning | 13,880 | 15,404 | -9.9 % | 15,404 | |
| Change in cash during period | 1,018 | -2,592 | n/a | -1,746 | |
| Effect of currency changes | -328 | 357 | n/a | 221 | |
| Cash at the end | 14,570 | 13,169 | 10.6 % | 13,880 | |
| KEY FIGURES | 1-6/ 2013 | 1-6/ 2012 | Change % | 1-12/2 012 | |
| Earnings per share, EUR | 0.18 | 0.18 | -5.1 % | 0.38 | |
| Earnings per share fully diluted, EUR | 0.17 | 0.18 | -5.1 % | 0.38 | |
| Shareholders' equity per share, EUR | 3.43 | 3.24 | 6.0 % | 3.48 | |
| Return on equity | 10.1 % | 11.5 % | -12.1 % | 11.6 % | |
| Return on capital employed | 10.4 % | 12.5 % | -17.1 % | 13.0 % | |
| Equity ratio | 48.5 % | 46.2 % | 4.9 % | 50.5 % | |
| Gearing | 21.8 % | 21.1 % | 3.2 % | 13.7 % | |
| Investments, tEUR | 4,637 | 1,739 | 166.6 % | 3,325 | |
| Investments % of net sales | 5.0 % | 1.7 % | 1.7 % | ||
| Order backlog, tEUR | 12,331 | 18,703 | -34.1 % | 17,000 | |
| Personnel, average | 1,336 | 1,326 | 0.8 % | 1,326 | |
| Number of shares (thousands) | 18,729 | 18,729 | 0.0 % | 18,729 | |
| including own shares | |||||
| Highest share price, EUR | 4.47 | 4.44 | 0.7 % | 4.44 | |
| Lowest share price, EUR | 3.78 | 3.04 | 24.3 % | 3.04 | |
| Average share price, EUR | 4.14 | 3.98 | 3.9 % | 3.98 | |
| Turnover, in million shares | 1.3 | 1.1 | 26.5 % | 2.7 | |
| Turnover, in MEUR | 5.6 | 4.2 | 33.5 % | 10.8 | |
| Treasury shares | |||||
| Number of shares | % of shares | % of votes | |||
| Teleste companies own shares 30.6.2013 | 1,189,654 | 6.35 % | 6.35 % | ||
| Contingent liabilities and pledged assets (tEUR) | |||||
| Leasing and rent liabilities | 7,194 | 8,929 | -19.4 % | 8,528 | |
| Derivative instruments (tEUR) | |||||
| Value of underlying forward contracts | 8,288 | 5,391 | 53.7 % | 5,936 | |
| Market value of forward contracts | 158 | -72 | n/a | -109 | |
| Interest rate swap | 11,000 | 11,500 | -4.3 % | 9,000 | |
| Market value of interest swap | 29 | -82 | n/a | -22 | |
| Taxes are computed on the basis of the tax on the profit for the period. | |||||
| OPERATING SEGMENTS (tEUR) | 1-6/2013 | 1-6/2012 | Change % | 1-12/2012 | |
| Video and Broadband Solutions | |||||
| Orders received | 44,769 | 50,180 | -10.8 % | 97,730 | |
| Net sales | 49,438 | 51,777 | -4.5 % | 101,230 | |
| EBIT | 4,744 | 4,072 | 16.5 % | 8,497 | |
| EBIT% | 9.6 % | 7.9 % | 8.4 % | ||
| Network Services | |||||
| Orders received | 42,816 | 48,140 | -11.1 % | 91,931 | |
| Net sales | 42,816 | 49,040 | -12.7 % | 92,645 | |
| EBIT | -404 | 1,285 | n/a | 2,439 | |
| EBIT% | -0.9 % | 2.6 % | 2.6 % | ||
| Total | |||||
| Orders received | 87,585 | 98,320 | -10.9 % | 189,661 | |
| Net sales | 92,254 | 100,817 | -8.5 % | 193,875 | |
| EBIT | 4,340 | 5,357 | -19.0 % | 10,936 | |
| EBIT% | 4.7 % | 5.3 % | 5.6 % | ||
| Financial items | -185 | -761 | -75.7 % | -821 | |
| Operating segments net profit before taxes | 4,155 | 4,596 | -9.6 % | 10,115 | |
| Information per quarter (tEUR) | 4-6/13 | 1-3/13 | 10-12/12 | 7-9/12 | 4-6/12 | 7/2012- 6/2013 | |
| Video and Broadband Solutions | |||||||
| Orders received | 23,350 | 21,419 | 27,830 | 19,720 | 23,790 | 92,319 | |
| Net sales | 25,625 | 23,813 | 24,659 | 24,794 | 24,278 | 98,891 | |
| EBIT | 2,308 | 2,436 | 2,002 | 2,423 | 1,548 | 9,169 | |
| EBIT % | 9.0 % | 10.2 % | 8.1 % | 9.8 % | 6.4 % | 9.3 % | |
| Network Services | |||||||
| Orders received | 20,870 | 21,946 | 22,995 | 20,796 | 25,409 | 86,607 | |
| Net sales | 20,870 | 21,946 | 22,809 | 20,796 | 25,409 | 86,421 | |
| EBIT | -570 | 166 | 706 | 448 | 872 | 750 | |
| EBIT % | -2.7 % | 0.8 % | 3.1 % | 2.2 % | 3.4 % | 0.9 % | |
| Total | |||||||
| Orders received | 44,220 | 43,365 | 50,825 | 40,516 | 49,199 | 178,926 | |
| Net sales | 46,495 | 45,759 | 47,468 | 45,590 | 49,687 | 185,312 | |
| EBIT | 1,738 | 2,602 | 2,708 | 2,871 | 2,420 | 9,919 | |
| EBIT % | 3.7 % | 5.7 % | 5.7 % | 6.3 % | 4.9 % | 5.4 % | |
| Attributable to equity holders of the parent (tEUR) | |||||||||||
| A | Share capital | ||||||||||
| B | Share premium | ||||||||||
| C | Translation differences | ||||||||||
| D | Retained earnings | ||||||||||
| E | Invested free capital | ||||||||||
| F | Other funds | ||||||||||
| G | Total | ||||||||||
| H | Share of non-controlling interest | ||||||||||
| I | Total equity | ||||||||||
| A | B | C | D | E | F | G | H | I | |||
| Shareholder's equity 1.1.2013 | 6,967 | 1,504 | 685 | 48,007 | 2,737 | -22 | 59,878 | 678 | 60,557 | ||
| Total comprehensive income for the period | -471 | 3,058 | 51 | 2,638 | 2,638 | ||||||
| Share issue | 0 | 0 | |||||||||
| Paid dividend | -3,119 | -3,119 | 157 | -2,962 | |||||||
| Interest, non controll party | 34 | 34 | -34 | 0 | |||||||
| Equity-settled share-based payments | 376 | 376 | -376 | 0 | |||||||
| Shareholder's equity 30.6.2013 | 6,967 | 1,504 | 214 | 47,980 | 3,113 | 29 | 59,807 | 425 | 60,232 | ||
| Shareholder's equity 1.1.2012 | 6,967 | 1,504 | 54 | 43,559 | 2,737 | -166 | 54,655 | 623 | 55,278 | ||
| Total comprehensive income for the period | 357 | 3,222 | 84 | 3,663 | 0 | 3,663 | |||||
| Share issue | 0 | 0 | 0 | 0 | |||||||
| Paid dividend | -2,569 | -2,569 | 129 | -2,440 | |||||||
| Interest, non controll party | 37 | 37 | -37 | 0 | |||||||
| Equity-settled share-based payments | 54 | 54 | 0 | 54 | |||||||
| Shareholder's equity 30.6.2012 | 6,967 | 1,504 | 411 | 44,303 | 2,737 | -82 | 55,840 | 715 | 56,555 | ||
CALCULATION OF KEY FIGURES
| Return on equity: | Profit/loss for the financial period ------------------------------ * 100 Shareholders’ equity (average) |
| Return on capital employed: | Profit/loss for the period after financial items + financing charges ------------------------------ * 100 Total assets - non-interest-bearing liabilities (average) |
| Equity ratio: | Shareholders' equity ----------------------------- * 100 Total assets - advances received |
| Gearing: | Interest bearing liabilities - cash in hand and in bank - interest bearing assets ----------------------------- * 100 Shareholders' equity |
| Earnings per share: | Profit for the period attributable to equity holder of the parent ---------------------------------------------- Weighted average number of ordinary shares outstanding during the period |
| Earnings per share, diluted: | Profit for the period attributable to equity holder of the parent (diluted) ----------------------------------------------- Average number of shares - own shares + number of options at the period-end |
| Shareholders 30.6.2013 | Shares | % |
| EM Group Oy | 4,389,712 | 23.44 |
| Mandatum Life | 1,679,200 | 8.97 |
| Ilmarinen Mutual Pension Insurance Company | 953,854 | 5.09 |
| Kaleva Mutual Insurance Company | 824,641 | 4.40 |
| Op-Suomi Small Cap | 630,712 | 3.37 |
| Teleste Management II Oy | 542,000 | 2.89 |
| Varma Mutual Pension Insurance Company | 521,150 | 2.78 |
| State Pension Fund | 500,000 | 2.67 |
| Teleste Management Oy | 381,000 | 2.03 |
| Fim Fenno Mutual Fund | 271,342 | 1.45 |
| Sector Dispersion 30.6.2013 | Shareholders | % | Shares | % |
| Corporations | 288 | 5.66 | 7,240,394 | 38.65 |
| Financial and insurance corporations | 9 | 0.17 | 3,416,817 | 18.24 |
| Public institutions | 6 | 0.11 | 2,015,104 | 10.75 |
| Non-profit institutions | 36 | 0.70 | 383,374 | 2.04 |
| Households | 4,699 | 92.39 | 4,580,739 | 24.45 |
| Foreign countries and nominee registered | 48 | 0.94 | 1,092,162 | 5.83 |
| Total | 5,086 | 100.00 | 18,728,590 | 100.00 |
| Amount of shares 30.6.2013 | Shareholders | % | Shares | % |
| 0 - 100 | 1,145 | 22.51 | 78,038 | 0.41 |
| 101 – 1,000 | 2,965 | 58.29 | 1,244,753 | 6.64 |
| 1,001 – 10,000 | 880 | 17.30 | 2,394,287 | 12.78 |
| 10,001 – 100,000 | 73 | 1.43 | 1,681,485 | 8.97 |
| 100,001 – 1,000,000 | 21 | 0.41 | 7,261,115 | 38.77 |
| 1,000,001 - | 2 | 0.03 | 6,068,912 | 32.40 |
| Total | 5,086 | 100.00 | 18,728,590 | 100.00 |
| The following assets and liabilities were preliminary recognised in the acquisition of Asheridge: | |
| 1 000 € | Recognised fair values on acquisition |
| Fair values used in consolidation | |
| Trade marks (inc. in intangible assets) | 0 |
| Customer relationship (inc. in intangible assets) | 730 |
| Technology (inc. in intangible assets) | 533 |
| Inventories | 727 |
| Trade receivables | 1 126 |
| Book values used in consolidation | |
| Tangible asstes | 731 |
| Other receivables | 81 |
| Cash and cash equivalents | 219 |
| Total assets | 4 147 |
| Book values used in consolidation | |
| Interest-bearing liabilities | 1 209 |
| Trade payables | 1 084 |
| Deferred tax liabilites | 315 |
| Other liabilities | 242 |
| Total liabilities | 2 850 |
| Net identifiable assets and liabilities | 1 297 |
| Total consideration | 3 553 |
| Goodwill on acquisition | 2 257 |
| Consideration paid in cash | -1 184 |
| Cash and cash equivalents in acquired subsidiary | 219 |
| Total net cash outflow on the acquisition | -965 |
ADDITIONAL INFORMATION:
CEO Jukka Rinnevaara, phone +358 2 2605 866 or +358 400 747 488
DISTRIBUTION:
NASDAQ OMX Helsinki
Main Media
www.teleste.com