Helsinki, Finland, 2011-02-16 14:00 CET (GLOBE NEWSWIRE) --
HONKARAKENNE OYJ FINANCIAL STATEMENT RELEASE 16 February 2011 at 3:00 pm
HONKARAKENNE OYJ FINANCIAL STATEMENT RELEASE 1 JANUARY - 31 DECEMBER 2010
SUMMARY
Honkarakenne Group’s improvement programme yielded results, and the result of the entire Group for the year was financially positive.
September-December 2010
- Honkarakenne Group's consolidated net sales for the last quarter of the year amounted to EUR 15.0 million (EUR 12.7 million in 2009), an increase of 17% on the previous year's corresponding period
- Operating profit was EUR 0.5 million (EUR -1.2 million). Operating profit without non-recurring items was EUR 0.6 million (EUR -1.2 million)
- Profit before taxes was EUR 0.2 million (EUR -1.6 million)
- Earnings per share amounted to EUR 0.2 (EUR -0.53)
Year 2010
- Honkarakenne Group’s consolidated net sales for the entire year amounted to EUR 58.1 million (EUR 52.3 million), an increase of 11% on the previous year’s corresponding period
- Operating profit was EUR 1.3 million (EUR -3.0 million). Operating profit without non-recurring items was EUR 2.5 million (EUR -2.6 million)
- Profit before taxes was EUR 0.4 million (EUR -3.7 million)
- Earnings per share amounted to EUR 0.23 (EUR -1.05)
The Board shall propose at the Annual General Meeting that a dividend of EUR 0.10 per share be paid for the financial year that ended on 31 December 2010 in accordance with the articles of association and that the remaining available funds remain in the unrestricted shareholders’ equity.
The objective for the year 2011 is to attain net sales and a net result exceeding those of the previous year. As in the previous year the first quarter of the year will be financially negative due to seasonal variation.
| KEY FIGURES | 10-12/2010 | 10-12/2009 | 1-12/2010 | 1-12/2009 | change % |
| Net sales, MEUR | 15.0 | 12.7 | 58.1 | 52.3 | 11 |
| Operating profit/loss, MEUR | 0.5 | -1.2 | 1.3 | -3.0 | |
| Operating profit before non-recurring items, MEUR | 0.6 | -1.2 | 2.5 | -2.6 | |
| Profit/loss before taxes, MEUR | 0.2 | -1.6 | 0.4 | -3.7 | |
| Average number of personnel | 291 | 351 | |||
| Earnings/share (EPS), EUR | 0.20 | -0.53 | 0.23 | -1.05 | |
| Equity ratio, % | 42 | 29 | |||
| Return on equity, % | 7 | -26 | |||
| Shareholders' equity/share, EUR | 3.6 | 3.5 | |||
| Gearing, % | 73 | 149 |
Esa Rautalinko, President and CEO of Honkarakenne Oyj, in connection with the financial statement release:
”Honkarakenne’s net result for the entire year was good, considering the circumstances. At the beginning of 2010, the Group launched the improvement programme with the objective to attain cost savings of EUR 5 million for the year 2010. The impact of the improvement programme and the measures taken to expedite sales, which were implemented simultaneously, was EUR 5.1 million, meaning that the financial objectives of the improvement programme were realised.
As concerns net sales, it was pleasing that the net sales in Russia, part of the Finland and the Other countries group, rose significantly. However, the net sales in Central Europe were disappointing.
The Group’s result in the last quarter of the year was financially positive, which can be considered a very good result. Honkarakenne Group’s previous financially positive result in the last quarter of the year was in 2006, with net sales in that quarter totalling EUR 24.4 million.
The main focus in 2011 will be on expediting sales. Honkarakenne will focus on its premium and luxury strategy and further consolidating it. On the domestic market, growth will especially be sought in the residential house business, with Honkarakenne’s extremely high-quality environmentally-friendly low-energy solutions, also for areas zoned for stone buildings. In exports, premium products, such as Honka Fusion™, will be developed further, and new markets are opened for it. In the Far East and Other countries group, growth will also be sought by expanding the sales network.”
NET SALES
Honkarakenne Group’s net sales for the year 2010 increased by 11 per cent to EUR 58.1 million (EUR 52.3 million), the net sales in Finland rose by 15 per cent to EUR 27.3 million (EUR 23.8 million), and export net sales grew by 8 per cent to EUR 30.8 million (EUR 28.5 million).
The Group’s last-quarter net sales in 2010 grew by 17 per cent to EUR 15.0 million (EUR 12.7 million). The net sales in Finland grew by 11 per cent to EUR 5.7 million (EUR 5.1 million), and export net sales grew by 21 per cent to EUR 9.3 million (EUR 7.6 million).
Geographical distribution of net sales:
| DEVELOPMENT OF SALES | ||||||
| Distribution of net sales, % | 1-12/2010 | 1-12/2009 | ||||
| Finland | 47 % | 45 % | ||||
| Central Europe | 20 % | 24 % | ||||
| Far East | 10 % | 11 % | ||||
| Other countries | 23 % | 19 % | ||||
| Total | 100 % | 100 % | ||||
| Net sales, MEUR | 10-12/2010 | 10-12/2009 | Change % | 1-12/2010 | 1-12/2009 | Change % |
| Finland | 5.7 | 5.1 | 11 % | 27.3 | 23.8 | 15 % |
| Central Europe | 2.9 | 2.7 | 8 % | 11.7 | 12.7 | -8 % |
| Far East | 1.8 | 1.7 | 6 % | 5.7 | 5.8 | -1 % |
| Other countries | 4.5 | 3.2 | 41 % | 13.4 | 10.1 | 33 % |
| Total | 15.0 | 12.7 | 17 % | 58.1 | 52.3 | 11 % |
The figures for 'Central Europe' comprise Germany and France as well as the rest of Europe. The figures for 'Far East' comprise Japan and Mongolia. The figures for 'Other countries' comprise the CIS countries, the USA and Estonia.
At the end of December, the Group’s order book stood at EUR 18.0 million. At the same time the previous year, it was EUR 23.0 million.
DEVELOPMENT OF PROFIT AND PROFITABILITY
Operating profit in 2010 was EUR 1.3 million (EUR -3.0 million) and profit before taxes was EUR 0.4 million (EUR -3.7 million).
The calculations below present the change in operating profit from 2009 to 2010.
| Operating profit 2009 | -3.0 |
| Write-off of business value included in the profit and loss statement for 2009 | 0.4 |
| Improvement programme and increase in sales | 5.1 |
| Other items | 0.0 |
| Operating profit 2010 without non-recurring items | 2.5 |
| Non-recurring items | -1.2 |
| Operating profit 2010 | 1.3 |
Of the non-recurring items, EUR 0.4 million are related to the Timberheart bankruptcy and EUR 0.8 million to the execution of the improvement programme. Of the non-recurring items related to the improvement programme, 45% are related to severance compensation, 37% to the implementation of efficiency-improving projects and 18% to financing arrangements.
The Group's net result after taxes was EUR 1.1 million. Unregistered tax claims totalling EUR 0.9 million from previous years have been refunded.
FINANCING AND INVESTMENTS
The financial position of the Group is satisfactory. The equity ratio stood at 42% (29%) and interest-bearing net liabilities at EUR 12.8 million (EUR 18.4 million). EUR 3.2 million of the interest-bearing net liabilities carries a 30% minimum equity ration covenant term. Group liquid assets totalled EUR 1.9 million (EUR 1.7 million). The Group also has a EUR 10.0 million bank overdraft facility, EUR 3.2 million of which had been drawn on at the end of the report period (EUR 5.1 million). Gearing stood at 73% (149%). The company's capital expenditure in 2010 totalled EUR 0.5 million (EUR 2.5 million). The financial position of the Group is expected to further improve in 2011.
MARKET DEVELOPMENT
Based on a report commissioned by RTS Oy, Finnish log house production value is estimated to have grown by 16% in 2010. The figure includes production for Finland and for overseas export.
PRODUCTS AND MARKETING
In 2010, Honkarakenne implemented changes to enhance profitability in line with the improvement programme, especially in Finland to its sauna and vacation house collections that also modernised the product range in a customer oriented fashion. The changes concentrated on the development of industrial production efficiency of the models as well as on the improvement of product quality and design.
In Central Europe focus was placed on the sales of the Honka Fusion™ concept that was launched the previous year. Honka Fusion™ combines strong architectural design, innovative structure solutions and energy-efficiency in an unparalleled manner. Architects have the freedom to combine log, glass and rock surfaces while maintaining the modern energy-efficiency standards as well as the excellent indoor air quality of a log structure. Due to the non-settling log of Honka Fusion™, the surface of the structure can be plastered, for example, if necessary. This also enables log building in areas zoned for stone buildings.
The Effecta™ house model collection was launched in the Far East in the beginning of the year. It utilises cost-effective structural solutions and choice of components.
In the Other countries areas, it was noteworthy that deliveries started during the second quarter to the second-stage planning area in Copperlake, near St. Petersburg, comprising almost 80 apartments. In the first-stage of Copperlake, Honkarakenne delivered 45 premium–level houses to the area in 2005-2008.
In the last quarter of the year, Honkarakenne launched a significant number of new low-energy solutions. A new range of low-energy residential houses was launched. The energy consumption of the Honkarakenne low-energy models is approximately 30% lower than that of houses built according to the current standards. For example, the wooden city area which is being constructed in Myllypuro, Helsinki, will feature several Honkarakenne low-energy buildings.
For the part of vacation low-energy solutions, Honkarakenne has, in addition to the energy-efficient wall solutions, a concept that makes it possible to leave, in a simple manner, vacation houses unheated for the winter season without harming the structures.
In 2010, Honkarakenne launched an even more air-tight and energy-efficient log profile and a corner notch solution on all its markets. In addition, the new log profile creates a unique visual appearance. The dark shadow line between the logs is minimised and the hole in the inside corners, characteristic of log buildings, can be eliminated with new notching solutions. During the fourth quarter, the air-tightness of the log walls was improved by installing sealing between logs in certain log models at the factory. This decreases overall building costs and further improves the energy-efficiency of walls. As with Honkarakenne’s other products, all modifications are breathing and therefore make possible a healthy indoor air of excellent quality.
RESEARCH AND DEVELOPMENT
In January–December, the Group's R&D expenditures were EUR 0.6 million (EUR 0.6 million), 1.1% of net sales (1.2%). The Group has not activated development costs during the financial year.
STAFF
At the end of the year, the Group employed 291 people (351) on average. This is 60 less than at the same time in the previous year.
In the first quarter, the parent company concluded co-operation negotiations, which resulted in 33 notices of termination, of which 12 were pension schemes. In addition, 45 lay-offs of indefinite period were made. In the second quarter, the parent company agreed on authorisation for fixed-term layoffs of a maximum of 90 days until the end of 2010. In the last quarter, the parent company agreed on authorisation for fixed-term layoffs of a maximum of 60 days until the end of May 2011.
HONKARAKENNE OYJ’S 2010 ANNUAL GENERAL MEETING, BOARD OF DIRECTORS, AND AUDITORS
The Annual General Meeting (AGM) of Honkarakenne Oyj was held at the company’s headquarters in Tuusula on 26 March 2010. The AGM confirmed the financial statements of the parent company and Group and discharged from liability the board members and CEOs for 2009. The AGM decided not to pay divided for the 2009 financial year.
Mauri Saarelainen, Tomi Laamanen, Mauri Niemi, Pirjo Ruuska, Lasse Kurkilahti and Marko Saarelainen were elected to the Board of Directors. The Board’s organisation meeting elected Lasse Kurkilahti the Chairman of the Board.
Chartered accountant community KPMG Oy Ab was again selected to be the auditor, the main auditor being Ari Eskelinen.
HONKARAKENNE OYJ’S DIRECTED ISSUES, EXECUTIVES’ INCENTIVE PLAN, OWN SHARES, AND AUTHORISATIONS OF THE BOARD OF DIRECTORS
The issue of 1,200,000 Honkarakenne B shares and the increase in share capital were implemented and entered into the Trade Register at the beginning of February 2010. The Board of Directors allocated the 1,200,000 B shares to subscribers at EUR 2.90 per share. The total subscription price of the new shares amounted to EUR 3,480,000, resulting in an increase of EUR 2,400,000 in the share capital with the remainder recorded in the invested non-restricted equity fund.
In connection with the directed issue, Honkarakenne sold some of the equity shares that it held to a restricted circle of the company’s key personnel. The number of shares sold was 118,500 at EUR 2.90 per share.
During the second quarter, the Board of Directors of Honkarakenne Oyj decided on a new incentive plan directed to the members of the Honkarakenne Executive Group. On the basis of authorisation granted by the General Meeting of Shareholders of Honkarakenne, the Board of Directors of Honkarakenne decided on a share issue against payment. In the share issue, a maximum of 220,000 Honkarakenne new series B shares were issued for subscription by Honka Management Oy at the price of EUR 3.71 per share, in derogation from the shareholders’ pre-emptive subscription rights. The total subscription price of the new shares was recorded in the invested non-restricted equity fund. In addition, the top management, acting within the incentive plan, acquired 49,000 Honkarakenne series B shares in the name of the established limited company, Honka Management Oy. The share acquisition was financed by personal investments by the top management amounting to EUR 200,000 as well as by a loan provided by Honkarakenne to the amount of EUR 800,000. The plan will be valid until summer 2014, at which time it is intended to be dissolved. Through the implementation of the plan, the members of the Executive Group hold 5.2% of all Honkarakenne’s shares and 2.47% of all Honkarakenne’s votes. As Honka Management Oy will be consolidated to the overall figures of the Honkarakenne Group, the acquisition expenses of these shares have been entered in the consolidated financial statements as a deduction to the Group’s equity.
Honkarakenne has not acquired its own shares during the report period. The number of shares held by the Group has increased with the consolidation of Honka Management Oy. At the end of the report period, the Group held 364,385 of its Honkarakenne B shares with a total purchase price of EUR 1,377,609.57. These shares represent 7.05% of the company's capital stock and 3.35% of all votes.
Honkarakenne Oyj’s share capital comprises a total of 5,168,968 shares, of which 300,096 are A shares and 4,868,872 are B shares. Each B share carries one (1) vote and each A share carries twenty (20) votes. Hence, Honkarakenne’s shares in aggregate carry a total of 10,870,792 votes. The company’s total share capital is EUR 9,897,936.00.
The AGM decided on 26 March 2010 that the Board of Directors be granted authorisation to acquire own B shares up to 400,000 pieces with funds of the company’s non-restricted equity fund. In addition, the AGM authorised the Board of Directors to decide on a share issue against or without payment and issue of special rights in one or several batches giving right to shares under the Limited Liability Companies Act, Chapter 10, Section 1. By virtue of the authorisation, the Board of Directors can issue new shares and/or assign old B shares held by the company up to 1,200,000 pieces in total including the shares that can be given under special rights. Both of these authorisations are valid until 25 March 2011.
OWNERSHIP CHANGES IN ASSOCIATED COMPANIES
Honkarakenne Oyj made a deal on 29 December 2009 to sell its owner share of 15% of window manufacturer PW-Windows Oy that operates in Ikaalinen. The deal was realised in accordance to the terms in January 2010. Honkarakenne relinquished its ownership in PW-Windows Oy as part of the streamlining of the Group’s structure and improvement of purchasing operations.
CORPORATE GOVERNANCE
Honkarakenne Oyj follows the Limited Liability Companies Act and the Finnish Corporate Governance Code, 1 October 2010, for listed companies issued by the Finnish Securities Market Association. The company's website, www.honka.com/investors, provides more information on the corporate governance systems.
FUTURE OUTLOOK
The objective for the year 2011 is to attain net sales and a net result exceeding those of the previous year. As in the previous year the first quarter of the year will be financially negative due to seasonal variation.
The Group's order book totalled EUR 18 million at the end of December (EUR 23 million at the same time the previous year). The order book includes orders whose delivery date is within the next 24 months. Some orders may feature conditions related to building permits or financing. At the end of the financial year, the order book was 21.7% smaller than at the same time the previous year.
FORTHCOMING RISKS AND UNCERTAINTIES
During the economic recession, a clear change in the purchase behaviour of customers has been noted. The time-span of binding orders has shortened significantly. In the past, construction project orders were made considerably more in advance than at the moment. At the start of the last quarter of the 2010 financial year, the order book was considerably lower compared with the previous year but net sales were at a significantly higher level. This time-span change poses a significant risk concerning the entire year’s result forecast of Honkarakenne.
The reaction time to adjust costs and production volumes is clearly shorter than before. Honkarakenne has prepared for this by agreeing on authorisation for 60-day fixed-term employee-specific layoffs until the end of May 2011. In addition, Honkarakenne has developed its sales control system to be more proactive.
The consolidated financial statements include EUR 2.7 million (EUR 3.2 million) of long-term receivables which are more than 180 days overdue, with no credit loss provision. The Group has one significant concentration of credit risks in sales receivables, concerning the open sales receivables of one importer. No provision for doubtful debt has been made for this. The new sales made with this importer have been paid according to the agreed terms. Deliveries to the importer have continued, and the risks with the open sales receivables have not increased. A payment plan agreement related to the matter was signed during the second quarter of the year. The payment plan was specified in the last quarter of the year. These sales receivables have diminished during 2010.
The assessment of amounts in the balance sheet is based on current assessment by the management. If these assessments are changed, this may result in changes to the Group's result.
REPORTING
This report contains statements that relate to the future, and these statements are based on hypotheses that the company's management hold currently as well as on the decisions and plans that are currently in place. Although the management believes that the hypotheses relating to the future are well-founded, there is no guarantee that the said hypotheses will prove to be correct.
This financial statements bulletin has been prepared in line with standard IAS 34, Interim Financial Reporting. The new revised standards or interpretations effective as of 1 January 2010 have no bearing on the figures presented for the report period. The figures have not been examined by the auditor.
EVENTS AFTER THE REVIEW PERIOD
Honkarakenne regrouped its sales area division at the beginning of 2011. The new sales areas are:
Domestic, includes Finland.
West, includes the following countries: Germany, France, Netherlands, Belgium, Spain, Ireland, Great Britain, Iceland, Italy, Austria, Greece, Cyprus, Latvia, Lithuania, Luxembourg, Norway, Portugal, Poland, Sweden, Slovakia, Slovenia, Switzerland, Denmark, Czech Republic, Hungary, Estonia.
East, includes the following countries: Russia, Azerbaijan, Kazakhstan, Ukraine, other CIS countries.
Far East, includes Japan and South Korea.
Other markets, includes the following countries: Bulgaria, China, Croatia, Mongolia, North and South America, Romania, Serbia, Turkey as well as new target countries and markets.
In addition, the sales of factory process waste for recycling will be reported separately from the actual Honkarakenne core business operations.
The 2010 net sales information with the new sales area division are:
| Net sales, MEUR | 1-3/2010 | 4-6/2010 | 7-9/2010 | 10-12/2010 | 1-12/2010 |
| Domestic | 4.0 | 9.3 | 7.1 | 5.3 | 25.7 |
| West | 2.0 | 3.4 | 2.9 | 3.0 | 11.3 |
| East | 1.2 | 3.9 | 3.2 | 4.5 | 12.8 |
| Far East | 0.8 | 2.1 | 1.0 | 1.8 | 5.7 |
| Other markets | 0.2 | 0.4 | 0.5 | 0.1 | 1.1 |
| Process waste sales for recycling | 0.3 | 0.5 | 0.5 | 0.2 | 1.4 |
| Total | 8.5 | 19.6 | 15.0 | 15.0 | 58.1 |
OUTLOOK FOR 2011
The objective for the year 2011 is to attain net sales and a net result exceeding those of the previous year. As in the previous year the first quarter of the year 2011 will be financially negative due to seasonal variation.
PROPOSAL OF THE BOARD OF DIRECTORS ON THE USE OF PROFIT FUNDS
The free capital of the parent company was EUR 5.0 million on 31 December 2010, of which EUR 1.9 million is profit for the financial year. The Board proposes at the Annual General Meeting that a dividend of EUR 0.10 per share be paid for the financial year that ended on 31 December 2010 in accordance with the articles of association and that the remaining available funds remain in the unrestricted shareholders’ equity.
GENERAL MEETING
The Annual General Meeting of Honkarakenne Oyj will be held at the company’s headquarters in Tuusula on Friday 1 April 2011 at 2:00 pm.
HONKARAKENNE OYJ
Board of Directors
Further information: Esa Rautalinko, President and CEO, tel. +358 400 740 997, esa.rautalinko@honka.com or Mikko Jaskari, CFO, tel. +358 400 535 337, mikko.jaskari@honka.com.
This and previous releases are available for viewing on the company's website at www.honka.com/investors. In week 10, Honkarakenne will publish on the company’s website at www.honka.com/investors report by the Board of Directors, the financial statements and a separate Corporate Governance Statement. The 2011 interim reports will be published on 12 May 2011, 11 August 2011 and 10 November 2011.
DISTRIBUTION
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| CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME | ||||
| (unaudited) | 10-12/2010 | 10-12/2009 | 1-12/2010 | 1-12/2009 |
| (MEUR) | ||||
| Net sales | 15.0 | 12.7 | 58.1 | 52.3 |
| Other operating income | 0.2 | 1.0 | 1.0 | 1.6 |
| Change in inventories | -0.8 | 0.0 | 0.3 | -2.0 |
| Production for own use | 0.0 | 0.0 | 0.0 | 0.1 |
| Materials and services | -7.7 | -8.3 | -32.6 | -28.5 |
| Employee benefit expenses | -3.1 | -3.2 | -12.2 | -13.2 |
| Depreciations | -0.9 | -0.8 | -3.7 | -4.1 |
| Other operating expenses | -2.3 | -2.7 | -9.6 | -9.1 |
| Operating profit/loss | 0.5 | -1.2 | 1.3 | -3.0 |
| Financial income and expenses | -0.1 | -0.4 | -0.7 | -0.6 |
| Share of associated companies' profit | -0.2 | -0.0 | -0.2 | -0.2 |
| Profit/loss before taxes | 0.2 | -1.6 | 0.4 | -3.7 |
| Taxes | 0.7 | -0.3 | 0.7 | -0.0 |
| Profit/loss for the period | 0.9 | -1.9 | 1.1 | -3.7 |
| Other comprehensive income: | ||||
| Translation differences | 0.1 | 0.0 | 0.3 | 0.0 |
|
Total comprehensive income for the period |
1.0 | -1.9 | 1.4 | -3.7 |
| Attributable to: | ||||
| Equity holders of the parent | 1.0 | -1.9 | 1.4 | -3.7 |
| Non-controlling interest | -0.0 | -0.0 | -0.0 | 0.0 |
| 1.0 | -1.9 | 1.4 | -3.7 | |
| Earnings/share (EPS), EUR | ||||
| Basic | 0.20 | -0.53 | 0.23 | -1.05 |
| Diluted | 0.20 | -0.53 | 0.23 | -1.05 |
|
CONSOLIDATED BALANCE SHEET (unaudited) |
31.12.2010 |
31.12.2009 |
| (MEUR) | ||
| Assets | ||
| Non-current assets | ||
| Property, plant and equipment | 21.6 | 24.3 |
| Goodwill | 0.1 | 0.1 |
| Other intangible assets | 1.0 | 1.3 |
| Investments in associated companies | 1.8 | 2.1 |
| Other investments | 0.4 | 0.2 |
| Receivables | 0.1 | 0.3 |
| Deferred tax assets | 1.6 | 1.5 |
| 26.5 | 29.7 | |
| Current assets | ||
| Inventories | 9.9 | 9.4 |
| Trade and other receivables | 8.0 | 7.5 |
| Cash and bank receivables | 1.9 | 1.7 |
| 19.9 | 18.6 | |
| Total assets | 46.4 | 48.4 |
| 31.12.2010 | 31.12.2009 | |
| Shareholders' equity and liabilities | ||
| Equity attributable to equity holders of the parent | ||
| Capital stock | 9.9 | 7.5 |
| Share premium | 0.5 | 0.5 |
| Reserve fund | 5.3 | 5.3 |
| Unrestricted equity reserve | 1.9 | |
| Translation differences | 0.3 | 0.0 |
| Retained earnings | -0.6 | -1.0 |
| 17.3 | 12.3 | |
| Non-controlling interests | 0.2 | 0.0 |
| Total equity | 17.5 | 12.3 |
| Non-current liabilities | ||
| Deferred tax liabilities | 0.3 | 0.8 |
| Provisions | 0.4 | 0.4 |
| Intrest bearing debt | 11.1 | 16.1 |
| Non-intrest bearing debt | 0.0 | 0.5 |
| 11.8 | 17.8 | |
| Current liabilities | ||
| Trade and other payables | 13.5 | 14.3 |
| Tax liabilities | 0.0 | 0.0 |
| Intrest bearing debt | 3.6 | 4.0 |
| 17.1 | 18.3 | |
| Total liabilities | 28.9 | 36.0 |
| Total equity and liabilities | 46.4 | 48.4 |
|
STATEMENT OF CHANGES IN EQUITY (unaudited) |
|||||||||||
| Equity attributable to equity holders of the parent | |||||||||||
| 1000 EUR | a) | b) | c) | d) | e) | f) | g) | Total | h) | Total equity | |
| Total equity 1.1.2009 | 7.498 | 520 | 5.316 | 27 |
-1.124 |
3.819 |
16.056 |
9 |
16.065 |
||
| Purchase of own shares | -14 | -14 | -14 | ||||||||
| Total comprehensive income for the period | 2 | -3.737 | -3.735 | 0 | -3.735 | ||||||
| Total equity 31.12.2009 |
7.498 |
520 |
5.316 |
29 |
-1.138 |
82 |
12.307 |
9 |
12.316 |
||
| a) | b) | c) | d) | e) | f) | g) | Total | h) | Total equity | ||
| Total equity 1.1.2010 |
7.498 |
520 |
5.316 |
|
29 |
-1.138 |
82 |
12.307 | 9 | 12.316 | |
| Share issue | 2.400 | 1.080 | 3.480 | 3.480 | |||||||
| Management Incentive plan | 816 | -816 | 203 | 203 | |||||||
| Repurchase of own shares | -182 | -182 | -182 | ||||||||
| Proceeds from sale of own shares | 758 | -414 | 344 | 344 | |||||||
| Total comprehensive income for the period | 290 | 1.103 | 1.393 | -11 | 1.382 | ||||||
| Total equity 31.12.2010 | 9.898 | 520 | 5.316 | 1.896 | 319 | -1.378 | 771 | 17.342 | 200 | 17.542 | |
a) Share capital
b) Premium fund
c) Reserve fund
d) Unrestricted equity reserve
e) Translation difference
f) Own shares
g) Retained earnings
h) Non-controlling interests
|
CONSOLIDATED CASH FLOW STATEMENT (Unaudited) |
1.1.-31.12.2010 | 1.1.-31.12.2009 |
| (MEUR) | ||
| Cash flow from operations | 2.5 | 1.4 |
| Cash flow from investments, net | -0.5 | -1.1 |
| Total cash flow from financing | -1.8 | -0.2 |
| Share issue | 3.5 | |
| Increase in credit capital | 6.3 | |
| Decrease in credit capital | -5.4 | -6.2 |
| Other financial items | -0.3 | |
| Change in liquid assets | 0.2 | 0.1 |
| Liquid assets at the beginning of period | 1.7 | 1.6 |
| Liquid assets at the end of period | 1.9 | 1.7 |
NOTES TO THE FINANCIAL STATEMENT RELEASE
Calculation methods
This financial statements release has been prepared in line with standard IAS 34, Interim Financial Reporting. In preparing this financial statement release, Honkarakenne has observed the same preparation principles as in its annual financial statements of 2009, yet so that Honkarakenne has applied the new and changed standards and interpretations introduced in 2010. The most significant of these are: IFRS 3 (revised), Business Combinations and IAS 27 (revised), Consolidated and Separate Financial Statements.
According to the management’s view, the implementation of the above-mentioned standards and interpretations has not had an impact on the figures presented concerning the report period.
Honka Management Oy, established this year and owned by the top management of the company, has been included in the consolidated financial statements due to the terms and conditions of the shareholder agreement concluded between it and Honkarakenne Oyj.
Honkarakenne has one operating segment, the manufacture, sales and marketing of log houses, under the Honka brand. Geographically, the sales of the Group divide as follows: Finland, Central Europe, Far East, and other countries. The internal reporting of the management is in line with IFRS reporting. For this reason, separate reconciliations are not presented.
The figures have not been examined by the auditor.
| TANGIBLE ASSETS | |
| (Unaudited) | Tangible assets |
| (MEUR) | |
| Acquisition cost 1.1.2010 | 66.9 |
| Translation difference (+/-) | 0.5 |
| Increase | 0.5 |
| Decrease | -0.9 |
| Transfers between balance sheet items | -0.0 |
| Acquisition cost 31.12.2010 | 67.0 |
| Accumulated depreciation 1.1.2010 | -42.7 |
| Translation difference (+/-) | -0.3 |
| Disposals and reclassifications | 0.8 |
| Depreciation for the period | -3.2 |
| Accumulated depreciation 31.12.2010 | -45.4 |
| Book value 1.1.2010 | 24.3 |
| Book value 31.12.2010 | 21.6 |
Own shares
Honkarakenne Oyj has not acquired its own shares during the report period. In connection with the directed issue in January, the company sold some of the equity B shares that it held to a restricted circle of the company’s key personnel. The number of shares sold was 118,500 at EUR 2.90 per share.
During the second quarter, the Board of Directors of Honkarakenne Oyj decided on a new incentive plan directed to the members of the Honkarakenne Executive Group. On the basis of authorization granted by the General Meeting of Shareholders, the company’s Board of Directors decided on an issue of 220,000 shares with payment. In the share issue, 220,000 Honkarakenne’s new B shares were issued for subscription by Honka Management at the price of EUR 3.71 per share, in derogation from the shareholders’ pre-emptive subscription rights. In addition, the executives within the incentive plan acquired 49,000 Honkarakenne B shares in the name of the established limited company Honka Management Oy. Through the implementation of the plan, the members of the Executive Group hold 5.2% of all Honkarakenne’s shares and 2.47% of all Honkarakenne’s votes. As Honka Management Oy will be consolidated to the overall figures of the Honkarakenne Group, the acquisition expenses of these shares have been entered in the Group’s financial statement as a deduction to the Group’s equity.
At the end of the report period, the Group held 364,385 of its Honkarakenne B shares with a total purchase price of EUR 1,377,609.57. These shares represent 7.05% of the company's capital stock and 3.35% of all votes.
| CONTINGENT LIABILITIES | ||
| (Unaudited) | 31.12.2010 | 31.12.2009 |
| MEUR | ||
| For own loans | ||
| - Mortgages | 25.7 | 25.7 |
| - Pledged shares | ||
| - Other quarantees | 2.3 | 3.4 |
| For others | ||
| - Guarantees | 0.7 | 1.2 |
| Leasing liabilities | 0.8 | 0.8 |
| Rent liabilities | 0.1 | |
| Nominal values of forward exchange contracts | 2.8 | - |
| Derivative contracts | 0.3 | 0.3 |
Events in the circle of acquaintances
The Group’s circle of acquaintances consists of subsidiaries, associated companies and the company's management. The management included in the circle of acquaintances comprises the Board of Directors, CEO and the company's managing committee.
Honka Management Oy, owned by the top management of the company, has received from Honkarakenne Oyj a long-term loan of EUR 0.8 million.
In addition, during the second quarter, fixed assets totalling EUR 18.2 thousand have been sold to a management member in the circle of acquaintances.
| KEY INDICATORS | |||
| (Unaudited) | 1-12/2010 | 1-12/2009 | |
| Earnings/share (EPS) | eur | 0.23 | -1.05 |
| Return on equity | % | 7.3 | -26.3 |
| Equity ratio | % | 42.4 | 28.8 |
| Shareholders equity/share | eur | 3.6 | 3.5 |
| Net debt | MEUR | 12.8 | 18.4 |
| Gearing | % | 73.1 | 149.0 |
| Gross investments | MEUR | 0.5 | 2.5 |
| % of net sales | 0.8 | 4.8 | |
| Order book | MEUR | 18.0 | 23.0 |
| Average number of personnel | Staff | 135 | 170 |
| Workers | 156 | 181 | |
| Total | 291 | 351 | |
Due to the issue of new shares, the historical indicators by share have been corrected using the following formula: average number of shares x 1.01.
|
CALCULATION OF KEY INDICATORS |
||
| Profit for the period attributable to equity holders of parent | ||
| Earnings/share (EPS) | ------------------------------------------------------------------------------ | |
| Average number of outstanding shares | ||
| Profit before taxes – taxes | ||
| Return on equity % | ------------------------------------------------------------------------------ | x 100 |
| Total equity, average | ||
| Total equity | ||
| Equity ratio, % | ------------------------------------------------------------------------------ | x 100 |
| Balance sheet total - advances received | ||
| Net debt | Interest-bearing debt - cash and cash equivalents | |
| Interest-bearing debt - cash and cash equivalents | ||
| Gearing, % | ------------------------------------------------------------------------------ | x 100 |
| Total equity | ||
| Shareholders’ equity | ||
| Shareholders equity/share | ------------------------------------------------------------------------------ | |
| Number of shares outstanding at end of period | ||
