Income statement
Consolidated net sales of first quarter 2009 was 53.1 mil. kroons/3.4 mil. euros
(73.9 mil. kroons/4.7 mil. euros in same period of 2008) representing a 28%
decrease on the first quarter compared to Q1 2008. The Group's gross margin in
the first quarter of 2009 was 19.5% compared to 23.9% in the first quarter of
2008. Consolidated operating profit amounted to 0.3 mil. kroons/17 thousand
euros (5.9 mil. kroons/378 thousand euros in same period 2008). The consolidated
operating margin of net sales was 0.5% (8.0% in Q1 2008).
Consolidated net loss amounted to 0.7 mil. kroons/43 thousand euros, compared to
5.1 mil. kroons/328 thousand euros in Q1 2008), and the net margin was -1.3%
(1.8% in Q1 2008). In Q1 2009, the Group's return on equity was -1.0% (6.7% in
Q1 2008) and return on assets was -0.4% (3.0% in Q1 2008).
The main reason for loss is decrease of net sales and cutting of production
volume in main purpose to keep liquidity in present market situation.
Balance sheet
As of 31.3.2009 the total assets of Viisnurk amounted to 155.9 mil. kroons/10.0
mil. euros (31.12.2008: 163.8 mil. kroons/10.5 mil. euros). The liabilities of
the company accounted for 54.8% (31.12.2008: 56.5%) thereof, i.e. 85.5 mil.
kroons/5.5 mil. euros (31.12.2008: 92.6 mil. kroons/5.9 mil. euros).
Receivables and prepayments have increased by 7.3 mil. kroons/0.5 mil. euros
i.e. 37% decrease with 3 months. The reason of increase of receivables is very
small sales in December 2008, which essentially lowered the amount of
receivables at the end of December.
Inventories decreased by 10.2 mil. kroons/0.7 mil. euros to reach 57.9 mil.
kroons/3.7 mil. euros on 31.3.2009. (31.12.2008: 68.1 mil. kroons/4.4 mil.
euros). The lowering of amount of inventories is one of the main goals to
survive in crisis and to keep liquidity. Property, plant and intangibles
decreased by 1.9 mil. kroons/0.1 mil. euros mainly as a result of depreciation.
Short-term loans decreased by 2.0 mil. kroons/0.1 mil. euros and amounted to
15.7 mil. kroons/1.0 mil. euros on 31 March 2009 (31.12.2008: 17.7 mil.
kroons/1.1 mil. euros). Supplier payables, tax liabilities, other payables,
including payables to employees, and provisions amounted to 38.7 mil. kroons/2.5
mil. euros (31.12.2008: 43.8 mil. kroons/2.8 mil. euros). Current and
non-current liabilities decreased by 7.1 mil. kroons/0.5 mil. euros to 85.5 mil.
kroons/5.5 mil. euros (31.12.2008: 92.6 mil. kroons/5.9 mil. euros).
Divisional review:
Net sales by business segments
--------------------------------------------------------------------------------
| | th. EEK | th. EUR | % of net sales |
--------------------------------------------------------------------------------
| | Q1 2009 | Q1 2008 | Q1 2009 | Q1 2008 | Q1 2009 | Q1 2008 |
--------------------------------------------------------------------------------
| Furniture | 27,598 | 36,089 | 1,764 | 2,307 | 52.0% | 48.9% |
| Factory | | | | | | |
--------------------------------------------------------------------------------
| Skano | 8,934 | 9,686 | 571 | 619 | 16.8% | 13.1% |
--------------------------------------------------------------------------------
| Building | 20,387 | 33,785 | 1,303 | 2,159 | 38.4% | 45.7% |
| Materials | | | | | | |
| Division | | | | | | |
--------------------------------------------------------------------------------
| Elimination | (3,833) | (5,693) | (245) | (364) | (7.2)% | (7.7)% |
--------------------------------------------------------------------------------
| TOTAL | 53,086 | 73,867 | 3,393 | 4,721 | 100.0% | 100.0% |
--------------------------------------------------------------------------------
Net sales by geographical segments
--------------------------------------------------------------------------------
| | th. EEK | th. EUR | % of net sales |
--------------------------------------------------------------------------------
| | Q1 2009 | Q1 2008 | Q1 2009 | Q1 2008 | Q1 2009 | Q1 2008 |
--------------------------------------------------------------------------------
| Finland | 21 704 | 35 435 | 1 387 | 2 265 | 40,9% | 48,0% |
--------------------------------------------------------------------------------
| Russia | 12 514 | 15 961 | 799 | 1 020 | 23,6% | 21,6% |
--------------------------------------------------------------------------------
| Estonia | 7 871 | 12 813 | 503 | 819 | 14,8% | 17,3% |
--------------------------------------------------------------------------------
| Ukraine | 2 894 | 1 031 | 185 | 66 | 5,5% | 1,4% |
--------------------------------------------------------------------------------
| Latvia | 2 368 | 3 112 | 151 | 199 | 4,5% | 4,2% |
--------------------------------------------------------------------------------
| Lithuania | 2 218 | 2 638 | 142 | 168 | 4,2% | 3,6% |
--------------------------------------------------------------------------------
| Portugal | 1 245 | 0 | 79 | 0 | 2,3% | 0,0% |
--------------------------------------------------------------------------------
| Germany | 743 | 1 202 | 48 | 77 | 1,4% | 1,6% |
--------------------------------------------------------------------------------
| Kazakhstan | 629 | 527 | 40 | 34 | 1,2% | 0,7% |
--------------------------------------------------------------------------------
| Sweden | 559 | 1 017 | 36 | 65 | 1,1% | 1,4% |
--------------------------------------------------------------------------------
| Belarusian | 119 | 0 | 8 | 0 | 0,2% | 0,0% |
--------------------------------------------------------------------------------
| Other countries | 222 | 131 | 15 | 8 | 0,4% | 0,2% |
--------------------------------------------------------------------------------
| TOTAL | 53 086 | 73 867 | 3 393 | 4 721 | 100,00% | 100,00% |
--------------------------------------------------------------------------------
Regarding the markets, turnover has decreased in all big markets. The main
reasons of increased turnover in Ukraine were the stores opened in 2008 which in
the first quarter of 2008 were still in the start-up phase or not opened. AS
Viisnurk initiated sales into Portugal and Belarusian.
Gross profit by business segments
--------------------------------------------------------------------------------
| | th. EEK | th. EUR |
--------------------------------------------------------------------------------
| | Q1 2009 | Q1 2008 | Q1 2009 | Q1 2008 |
--------------------------------------------------------------------------------
| Furniture Factory | 3,188 | 4,186 | 204 | 268 |
--------------------------------------------------------------------------------
| Skano | 4,416 | 4,670 | 282 | 298 |
--------------------------------------------------------------------------------
| Building Materials | 2,820 | 8,838 | 180 | 565 |
| Division | | | | |
--------------------------------------------------------------------------------
| Elimination | (66) | (11) | (4) | (1) |
--------------------------------------------------------------------------------
| TOTAL | 10,358 | 17,683 | 662 | 1,130 |
--------------------------------------------------------------------------------
The main reason for decreased gross margin in Building Material Division is
changes in product portfolio and growth of cost value due to small production
volume and big fixed costs.
Profit by business segments
--------------------------------------------------------------------------------
| | th. EEK | th. EUR |
--------------------------------------------------------------------------------
| | Q1 2009 | Q1 2008 | Q1 2009 | Q1 2008 |
--------------------------------------------------------------------------------
| Furniture Factory | 1,616 | 1,834 | 103 | 117 |
--------------------------------------------------------------------------------
| Skano | (778) | (164) | (50) | (10) |
--------------------------------------------------------------------------------
| Building Materials | (248) | 4,262 | (16) | 272 |
| Division | | | | |
--------------------------------------------------------------------------------
| Elimination | (325) | (11) | (20) | (1) |
--------------------------------------------------------------------------------
| TOTAL | 265 | 5,921 | 17 | 378 |
--------------------------------------------------------------------------------
| Net financial costs | (938) | (788) | (60) | (50) |
--------------------------------------------------------------------------------
| PROFIT BEFORE TAXES | (673) | 5,133 | (43) | 328 |
--------------------------------------------------------------------------------
| Income tax | 0 | 0 | 0 | 0 |
--------------------------------------------------------------------------------
| NET PROFIT | (673) | 5,133 | (43) | 328 |
--------------------------------------------------------------------------------
Furniture Division
The net sales of AS Viisnurk Furniture Division in the first quarter amounted to
32.7 mil. kroons/2.1 mil. euros (2008: 40.1 mil. kroons/2.6 mil. euros) and the
economic result 0.1 mil. kroons/8 thousand euros as a profit (2008: 1.4 mil.
kroons/88 thousand euros). As compared to the previous year the turnover of the
division has decreased by 7.4 mil. kroons/472 thousand euros (18.4%).
Furniture Retail - Skano
AS Viisnurk retail business is operated by a private limited company OÜ Skano
and its subsidiaries in Latvia, Lithuania and Ukraine. Skano has totally 10
stores in Tallinn, Pärnu, Riga, Vilnius, Kaunas, Klaipeda, Kiev, Donetsk,
Kharkiv and Odessa at the end of the first quarter.
As a result of unexpected economical situation, management decided to stop
openings of new stores. Management is in negotiations with leasers to lower
premises rents.
Retail sales by countries
--------------------------------------------------------------------------------
| | th. EEK | th. EUR | % of net sales | Number of |
| | | | | stores |
--------------------------------------------------------------------------------
| | Q1 | Q1 | Q1 | Q1 | Q1 | Q1 | Q1 | Q1 |
| | 2009 | 2008 | 2009 | 2008 | 2009 | 2008 | 2009 | 2008 |
--------------------------------------------------------------------------------
| Estonia | 2,200 | 4,511 | 141 | 288 | 24.6% | 46.6% | 2 | 2 |
--------------------------------------------------------------------------------
| Latvia | 1,730 | 2,319 | 110 | 148 | 19.4% | 23.9% | 1 | 1 |
--------------------------------------------------------------------------------
| Lithuan | 2,110 | 2,533 | 135 | 162 | 23.6% | 26.2% | 3 | 3 |
| ia | | | | | | | | |
--------------------------------------------------------------------------------
| Ukraine | 2,894 | 323 | 185 | 21 | 32.4% | 3.3% | 4 | 2 |
--------------------------------------------------------------------------------
| TOTAL | 8,934 | 9,686 | 571 | 619 | 100.0% | 100.0% | 10 | 8 |
--------------------------------------------------------------------------------
The retail sale of the Furniture Division decreased most in Estonia. The sale in
Ukraine has increased in stores opened after 31.3.2008. Within the first quarter
this year the retail sale has decreased by 7.8% as compared to the same period
last year. The stores that were opened before 31.3.2008 (Tallinn, Riga, Pärnu,
Vilnius, Kaunas, Klaipeda, Kharkiv, Kiev) have decreased the sales in the first
quarter by 33% compared to the same period in 2008.
Furniture Factory
The Furniture Factory's sales in the first quarter in the company's basic target
market in Russia and Finland have decreased and clients do not estimate sales
recovering in near future.
Furniture Factory sales by countries
--------------------------------------------------------------------------------
| | th EEK | th EUR | % of net sales |
--------------------------------------------------------------------------------
| | Q1 2009 | Q1 2008 | Q1 2009 | Q1 2008 | Q1 2009 | Q1 2008 |
--------------------------------------------------------------------------------
| Russia | 11,691 | 14,637 | 747 | 935 | 42.4% | 40.6% |
--------------------------------------------------------------------------------
| Finland | 10,328 | 13,653 | 660 | 873 | 37.4% | 37.7% |
--------------------------------------------------------------------------------
| Kazakhstan | 629 | 527 | 40 | 34 | 2.3% | 1.5% |
--------------------------------------------------------------------------------
| Germany | 620 | 966 | 40 | 62 | 2.2% | 2.7% |
--------------------------------------------------------------------------------
| Others | 497 | 613 | 32 | 39 | 1.8% | 1.7% |
--------------------------------------------------------------------------------
| Subsidiarie | 3,833 | 5,693 | 244 | 364 | 13.9% | 15.8% |
| s | | | | | | |
--------------------------------------------------------------------------------
| TOTAL | 27,598 | 36,089 | 1,763 | 2,307 | 100.0% | 100.0% |
--------------------------------------------------------------------------------
Building Materials Division
The net sales of the Building Materials Division in the first quarter amounted
to 20.4 mil. kroons/1.3 mil. euros and loss to 0.8 mil. kroons/51 thousand
euros. In the same period last year, the turnover of the division totalled to
33.8 mil. kroons/2.2 mil. euros and the profit 3.8 mil. kroons/240 thousand
euros. As compared to the previous year the turnover of the division has
decreased by 13.4 mil. kroons/856 thousand euros and the profit has decreased by
4.5 mil. kroons/291 thousand euros.
Net sales by geographical segments
--------------------------------------------------------------------------------
| | th. EEK | th. EUR | % of net sales |
--------------------------------------------------------------------------------
| | Q1 2009 | Q1 2008 | Q1 2009 | Q1 2008 | Q1 2009 | Q1 2008 |
--------------------------------------------------------------------------------
| Finland | 11 376 | 21 782 | 727 | 1392 | 55,8% | 64,5% |
--------------------------------------------------------------------------------
| Estonia | 5 365 | 7 820 | 343 | 500 | 26,3% | 23,1% |
--------------------------------------------------------------------------------
| Portugal | 1 245 | 0 | 80 | 0 | 6,1% | 0,0% |
--------------------------------------------------------------------------------
| Russia | 823 | 1 324 | 53 | 85 | 4,0% | 3,9% |
--------------------------------------------------------------------------------
| Latvia | 638 | 793 | 41 | 51 | 3,1% | 2,3% |
--------------------------------------------------------------------------------
| Sweden | 559 | 1 017 | 36 | 65 | 2,7% | 3,0% |
--------------------------------------------------------------------------------
| Germany | 123 | 236 | 8 | 15 | 0,6% | 0,7% |
--------------------------------------------------------------------------------
| Lithuania | 108 | 105 | 7 | 7 | 0,5% | 0,3% |
--------------------------------------------------------------------------------
| Ukraine | 0 | 708 | 0 | 45 | 0,0% | 2,1% |
--------------------------------------------------------------------------------
| Other countries | 150 | 0 | 10 | 0 | 0,7% | 0,0% |
--------------------------------------------------------------------------------
| TOTAL | 20 387 | 33 785 | 1 305 | 2 160 | 100,0% | 100,0% |
--------------------------------------------------------------------------------
Building Boards
The product group that makes up the biggest proportion in general building
boards are wind protection boards. Compared to last year, decrease of sales is
the biggest in this segment. This is caused by decrease of the building sector
in Estonia and Finland, two main markets for the product. Sale of products to
companies operating outside the building sector is same as previous year.
Interior Finishing Boards
The biggest market of Isotex interior finishing boards in the first quarter was
Finland. Sale in the domestic market of Estonia has decreased marginally and was
almost on the level of last year. Sales volumes have been achieved in Lithuania
and Russia. In connection with the increase of production capacity potential,
activities have been continued in order to find new markets.
Consolidated balance sheet
--------------------------------------------------------------------------------
| | Th EEK | Th EEK | Th EUR | Th EUR |
--------------------------------------------------------------------------------
| | 31.3.2009 | 31.12.200 | 31.3.2009 | 31.12.2008 |
| | | 8 | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Cash and bank | 3,831 | 6,913 | 245 | 442 |
--------------------------------------------------------------------------------
| Receivables and | 26,835 | 19,568 | 1,715 | 1,250 |
| prepayments | | | | |
--------------------------------------------------------------------------------
| Inventories | 57,896 | 68,096 | 3,701 | 4,351 |
--------------------------------------------------------------------------------
| Total current assets | 88,562 | 94,577 | 5,661 | 6,043 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Investment property | 2,893 | 2,893 | 185 | 185 |
--------------------------------------------------------------------------------
| Tangible fixed assets | 64,431 | 66,333 | 4,118 | 4,239 |
--------------------------------------------------------------------------------
| Intangible fixed assets | 19 | 21 | 1 | 1 |
--------------------------------------------------------------------------------
| Total fixed assets | 67,343 | 69,247 | 4,304 | 4,425 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| TOTAL ASSETS | 155,905 | 163,824 | 9,965 | 10,468 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Debt obligations | 15,654 | 17,722 | 1,001 | 1,132 |
--------------------------------------------------------------------------------
| Payables and prepayments | 38,620 | 43,646 | 2,468 | 2,790 |
--------------------------------------------------------------------------------
| Short-term provisions | 86 | 115 | 6 | 7 |
--------------------------------------------------------------------------------
| Total current liabilities | 54,360 | 61,483 | 3,475 | 3,929 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Non-current debt | 27,720 | 27,720 | 1,772 | 1,772 |
| obligations | | | | |
--------------------------------------------------------------------------------
| Non-current provisions | 3,421 | 3,421 | 219 | 219 |
--------------------------------------------------------------------------------
| Total non-current | 31,141 | 31,141 | 1,991 | 1,991 |
| liabilities | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Total liabilities | 85,501 | 92,624 | 5,466 | 5,920 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Share capital at nominal | 44,991 | 44,991 | 2,875 | 2,875 |
| value | | | | |
--------------------------------------------------------------------------------
| Issue premium | 5,698 | 5,698 | 364 | 364 |
--------------------------------------------------------------------------------
| Statutory capital reserve | 4,499 | 4,499 | 288 | 288 |
--------------------------------------------------------------------------------
| Currency translation | 130 | 253 | 8 | 14 |
| reserve | | | | |
--------------------------------------------------------------------------------
| Retained profits | 15,759 | 9,717 | 1,007 | 621 |
--------------------------------------------------------------------------------
| Net profit for the year | (673) | 6,042 | (43) | 386 |
--------------------------------------------------------------------------------
| Total equity | 70,404 | 71,200 | 4,499 | 4,548 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| TOTAL LIABILITIES AND | 155,905 | 163,824 | 9,965 | 10,468 |
| EQUITY | | | | |
--------------------------------------------------------------------------------
Consolidated income statement
--------------------------------------------------------------------------------
| | Th EEK | Th EEK | Th EUR | Th EUR |
--------------------------------------------------------------------------------
| | 3 m 2009 | 3 m 2008 | 3 m 2009 | 3 m 2008 |
| | | (adjusted) | | (adjusted) |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| RETURN ON SALES | 53,086 | 73,867 | 3,393 | 4,721 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Cost of production sold | (42,728) | (56,184) | (2,731) | (3,591) |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Gross profit | 10,358 | 17,683 | 662 | 1,130 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Marketing expenses | (8,878) | (9,922) | (567) | (634) |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| General administrative | (1,516) | (1,585) | (97) | (101) |
| expenses | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Other income | 1,058 | 179 | 67 | 11 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Other expenses | (756) | (435) | (48) | (28) |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Operating profit | 266 | 5,920 | 17 | 378 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Financial income and | (939) | (787) | (60) | (50) |
| financial expenses | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| NET PROFIT FOR THE | (673) | 5,133 | (43) | 328 |
| PERIOD | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Basic earnings per share | (0.15) | 1.14 | (0.01) | 0.07 |
--------------------------------------------------------------------------------
| Diluted earnings per | (0.15) | 1.14 | (0.01) | 0.07 |
| share | | | | |
--------------------------------------------------------------------------------
Einar Pähkel
CFO
+372 447 8331
einar.pahkel@viisnurk.ee
