SECOND QUARTER REPORT 2001
- Revenues of 760 MNOK (up 15%)
- Europe 227 MNOK (down 1%)
- North America 446 MNOK (up 4%)
- South America 117 MNOK (new)
- Profit before tax of 132 MNOK (up 18%)
- The amendment to the existing German Packaging. Ordinance was not supported but deposit on non-refillable containers is expected to be announced on August 15, 2001 under the existing law
- Dutch agreement to introduce recovery system for non-refillable beverage containers January 1, 2003
- Israel introduces deposit October 1, 2001
- Wise supply contract signed, sale of Wise Recycling in progress, but not concluded
- Continued weak development in the processing activities of the Materials Handling business in California - restructuring in progress
The German Upper House, (Bundesrat), did not support the proposed amendment to the Packaging Ordinance to include all non-refillable beverage packaging in a new deposit system. The proposal from Rheinland Pfalz to replace the existing 72% minimum refillable quota with a new and lower quota received support. According to the Minister of Environment, Mr Jurgen Trittin, this will most likely not be accepted by the federal cabinet. The 1998/99 measurement of the refillable quota will be announced before August 15th. If the refillable quota is confirmed at 70.13% for 1998/99,as previously communicated, the current law requires deposit to be introduced on all beverage containers except for softdrinks. Such deposit system must be introduced not later than six months after an announcement. German revenues were weak during 2nd quarter as retailers are awaiting the final conclusions on the proposed new deposit. This trend is expected to continue into third quarter 2001. If the deposit is confirmed to be implemented as from early 2002 this could lead to substantial investments in the fourth quarter.
The Dutch Minister of Environment communicated late June 2001 that he had reached an
agreement with industry to implement a recovery system for non-refillable beverage containers before January 1, 2003. The Dutch market had strong growth in revenues during second quarter, mainly because of replacement of older RVM's. The order situation indicates a continued strong performance for the second half-year.
The second quarter in North America was generally weaker than first quarter, and the major deviations from earlier estimates came in California. Despite the improved stability in the aluminum pricing from the reestablished supply agreement with WMG, TOMRA's processing activities of the Materials Handling business in California showed a continued weak development during the second quarter. Overall declines in the Californian recycling rates combined with the inability to build a sufficient commercial volume has resulted in significantly underutilized processing capacity. Critical assessment of the processing activities is in progress. Failure to meet the minimum return on investment expectations will result in restructuring of these activities. The financial impact of the restructuring will be improved profitability but may have negative impact on revenues.
The South American activities are developing according to expectations.
For report with tables and presentation, follow this link:
Presentation 2nd quarter 2001
Asker, July 16th 2001 <BR>TOMRA SYSTEMS ASA <BR> <BR>Erik Thorsen <BR>President