OLVI PLC PRESS RELEASE 27 OCT 2005 at 09.00 am 1 of 5
OLVI GROUP'S INTERIM REPORT, 1 JANUARY TO 30 SEPTEMBER 2005
(9 MONTHS)
At 112.9 million euro, the Olvi Group's net sales were 13.0% higher
than in the previous year (99.9 million euro). Operating profit for
the period under review improved by 37.0% to 11.6 (8.5) million euro.
The Group's gross capital expenditure amounted to 16.7 (15.1) million
euro, and its equity to total assets ratio stood at 48.09 percent
(45.83%).
IFRS reporting
Olvi Group adopted the International Financial Reporting Standards
(IFRS) as of 1 January 2005. The interim report from 1 January to 30
September 2005 has been prepared in accordance with IFRS recognition
and valuation principles. Comparison figures related to the
transition have been provided as an appendix to the interim report
published for the first quarter of the fiscal year. The comparison
figures used for this report are the IFRS figures for 2004 provided in
the appendix in question.
Net sales and earnings
The Group’s net sales from January to September amounted to 112.9
(99.9) million euro. This is 13.0 million euro or 13.0 percent more
than in the previous year. Growth was facilitated by good summer
weather in the entire operating area, as well as investments in
additional capacity in the Baltic states.
Net sales by geographical segments (million euro)
1-9/2005 1-9/2004
Finland 56.26 54.82
Estonia 38.87 30.14
Latvia 10.36 8.73
Lithuania 11.42 9.44
Eliminations -4.03 -3.23
Olvi Group total 112.88 99.90
The Group’s operating profit increased by 37.0 percent to 11.6 (8.5)
million euro. Net profit for the period increased by 41 percent to 8.9
(6.3) million euro.
Operating profit by geographical segments (million euro)
1-9/2005 1-9/2004
Finland 3.83 3.42
Estonia 6.91 5.60
Latvia 0.43 0.02
Lithuania -0.31 0.04
Eliminations 0.77 -0.62
Olvi Group total 11.63 8.46
2(5)
Sales volumes by market area (million litres)
1-9/2005 1-9/2004
Finland 81.2 76.4
Estonia 87.1 77.5
Latvia 24.6 22.7
Lithuania 27.4 22.6
Eliminations -12.3 -21.4
Olvi Group total 208.0 177.8
The entire Olvi Group’s sales during the period under review
represented an increase of 30.2 million litres or 17.0 percent on the
previous year.
Total sales of the parent company Olvi plc amounted to 81.2 million
litres, which is 4.9 million litres or 6.4 percent more than a year
earlier. Olvi’s domestic sales increased by 13.6 percent to 77.3
(68.0) million litres. Olvi’s tax free and export sales from January
to September totalled 4.0 million litres, which was 4.4 million litres
less than a year earlier. The decrease is attributable to a diminished
volume of intra-Group freighted work as investments in the Baltic
countries increased the in-house capacity of the Baltic subsidiaries.
The parent company Olvi plc’s operating profit in the period under
review amounted to 3.8 (3.4) million euro. The operating profit
improved only slightly on the previous year despite good sales
development. Price competition in the beer market has been intense for
a long time, and the situation has continued.
The total sales of the Estonian subsidiary AS A. Le Coq Tartu
Õlletehas increased to 87.1 (77.5) million litres, which is 12.3% more
than in the previous year. The sales of AS Ösel Foods are included in
the figures for AS Tartu Õlletehas. AS A. Le Coq Tartu Õlletehas’s
operating profit for the period under review was good and improved by
26.8 percent on the previous year.
From January to September, the sales of A/S Cesu Alus operating in
Latvia totalled 24.6 (22.7) million litres, representing an increase
of 8.4 percent. The company’s operating profit in the period under
review improved from near zero in the previous year to 0.4 million
euro.
The total sales of AB Ragutis operating in Lithuania increased to 27.4
(22.6) million litres during the period under review. The total
increase of sales was 4.8 million litres or 21.3% compared to the
previous year. However, beer prices were still low in Lithuania, and
the operating result of AB Ragutis remained in the red.
3(5)
Investments
During the period under review, the Olvi Group's gross capital
expenditure amounted to 16.72 million euro (15.14 million euro). The
parent company Olvi plc accounted for 3.9 million euro and the
subsidiaries in the Baltic states for 12.8 million euro of the total.
The largest investments included the boiling room and bottling line at
the brewery in Latvia, as well as an automatic collection system
acquired to Iisalmi. The investments include payments for share
capital increases in A/S Cesu Alus and AB Ragutis that have been
recognised on the balance sheet of AS A. Le Coq. The increase of share
capital in AB Ragutis was still pending registration at the time of
the interim report.
Personnel
The Group's average number of personnel during the period under review
was 1,073 (1,054), 339 (343) of them in Finland, 366 (361) in Estonia,
179 (162) in Latvia and 189 (188) in Lithuania.
Simplifying Olvi plc’s corporate structure
The Extraordinary General Meetings of Olvi plc’s fully owned
subsidiaries Oluttehdas Oiva Oy, Iisalmen Oluttehdas Osakeyhtiö Oy and
Olvin Juomaa Oy have decided on mergers in accordance with the merger
plan signed by the Boards of Directors of these Olvi Group
subsidiaries on 29 August 2005.
According to the merger plan, Oluttehdas Oiva Oy and Iisalmen
Oluttehdas Osakeyhtiö Oy will be merged into Olvin Juomaa Oy so that
all of the assets and liabilities of the merging companies will be
transferred to the receiving company without any liquidation
proceedings.
The merger is executed to increase the business efficiency of the
Group, reduce overall costs and simplify the corporate structure.
Because the mergers involve sister companies, no merger compensation
will be paid.
The scheduled date for registering the execution of merger is 31
December 2005.
The companies have not engaged in any business operations.
The Olvi plc share and warrants
Olvi plc’s registered share capital was 10,379,404.00 euro on 30
September 2005. The share capital is divided into 933,064 K shares and
4,256,638 A shares. The share’s nominal value is 2.00 euro.
4(5)
In May 2002, Olvi plc’s Board of Directors decided to allocate all of
the stock options issued by the Annual General Meeting on 4 April 2002
to Olvin Juomaa Oy, a wholly owned subsidiary of Olvi plc. Olvi plc’s
Board of Directors will decide on the eventual distribution of the
stock options allocated to Olvin Juomaa Oy to current or future key
personnel of the Olvi Group.
A maximum of 200,000 A shares in Olvi plc can be subscribed for using
the stock options. The exercise price of the stock options is the
average quote weighted by trade volume of the Olvi plc A share on the
Helsinki Stock Exchange from 1 July to 31 December 2002. The exercise
price of the stock options will be reduced by the amount of any
dividends distributed after the price-setting period has started and
before the shares are subscribed. The exercise price of the stock
options must be equal to or greater than the nominal value of the
share.
The subscription period for the stock options 2002A started on 1 April
2005, and for the stock options 2002B it will start on 1 April 2007.
The subscription period for both stock options ends on 30 April 2008.
A total of 1,553,596 Olvi plc shares changed hands from January to
September 2005, totalling 24.6 million euro in trading volume. The
traded shares represented 36.5 percent of the total number of A
shares. The average share price was 15.85 euro, with a low of 13.30
euro quoted in January and a high of 18.55 euro quoted in July.
The company does not hold any of its own shares, and the company’s
Board of Directors has not exercised its authorisation to sell the
company’s shares.
Shareholders
At the end of the review period, Olvi had a total of 4,357
shareholders, 78.6 percent of them Finnish (share of votes 93.3%).
Nominee-registered holdings amounted to 16.0% (3.6% of votes), and
registered foreign holdings stood at 5.4% (3.0% of votes).
Outlook for the rest of the year
Olvi Group’s overall market position has further strengthened from
January to September both in Finland and the Baltic states. The
increase in domestic sales has clearly outperformed the industry. Soft
drinks and ciders in particular have clearly gained a better market
position.
The level of beer prices in Finland is not expected to decrease any
more, but price competition and the role of beers as a product for
attracting customers will keep the prices relatively low. A slight
increase in total consumption in our entire operating area is expected
in 2005, due to reasons such as the boosting effect of the warm
summer.
5(5)
We estimate that Olvi Group’s operating profit for the entire year
will be better than last year. The reasons for this include positive
earnings development in the Baltic subsidiaries and good development
of volumes across the entire Group.
Further information:
Lasse Aho, Managing Director
Phone +358 17 838 5200 or +358 400 203 600
The information in this interim report is unaudited.
OLVI PLC
Board of Directors
APPENDICES
- Income statement and financial ratios, Appendix 1
- Balance sheet, Appendix 2
- Cash flow statement, Appendix 3
- Changes in shareholders’ equity, Appendix 4
- Number of shares, personnel and contingent liabilities,
Appendix 5
- Reconciliation of consolidated profit 30 September 2004,
Appendix 6
- Reconciliation of consolidated balance sheet 30 September
2004, Appendix 7
- Reconciliation of shareholders’ equity, Appendix 8
DISTRIBUTION
Hex Plc
Key media
www.olvi.fi
APPENDIX 1
OLVI GROUP
INTERIM REPORT, JANUARY-SEPTEMBER 2005
7-9/05 7-9/04 1-9/05 1-9/04 1-12/04
INCOME STATEMENT
EUR 1000
Net sales 41613 36062 112884 99899 128894
Other operating
income 309 112 467 287 637
Operating expenses -32375 -29865 -93943 -84080 -109974
Depreciation and
write-downs -2591 -2589 -7778 -7650 -10284
Operating profit 6956 3720 11630 8456 9274
Financial income
and expenses -303 -553 -1569 -954 -1996
Profit after
financial items 6653 3167 10062 7503 7279
Profit before
taxes 6653 3167 10061 7502 7279
Taxes -868 -615 -1374 -1396 -1535
Minority interest 96 5 171 153 225
Profit/loss
for the period 5881 2557 8858 6259 5968
- Profit to the
parent company’s
shareholders 5785 2552 8687 6106 5743
- Profit/loss
to the minority 96 5 171 153 225
KEY RATIOS
Ratios calculated from the profit
belonging to parent company shareholders:
- earnings per share, euro 1.69 1.24 1.16
- average number of shares
adjusted for dilution
from warrants, euro 1.67 1.20 1.13
Equity per share, EUR 12.78 11.95 11.89
Equity to total assets, % 48.09 45.83 45.10
Gross capital expenditure 16724 15138 18400
APPENDIX 2
OLVI GROUP
30.9.05 30.9.04 31.12.04
EUR 1000 EUR 1000 EUR 1000
BALANCE SHEET
ASSETS
Non-current assets
Intangible assets 2567 3521 2844
Goodwill 8706 8706 8706
Tangible assets 73766 68492 70130
Other investments 253 1033 253
Non-current assets 61 91 88
available for sale
Receivables 44 108 39
Total non-current assets 85397 81951 82060
Current assets
Inventories 23002 24716 21987
Receivables 26747 21200 24267
Liquid assets 2950 3108 4436
Current assets
total 52699 49024 50693
TOTAL ASSETS 138097 130975 132753
SHAREHOLDERS’ EQUITY AND LIABILITIES
Shareholders’ equity held by
parent company shareholders
Share capital 10379 9990 10028
Reserves 11506 10658 10752
Accrued earnings 35577 32782 32858
Net profit for the period 8860 6259 5969
Shareholders’ equity
before minority interest 66323 59689 59607
Minority interest 88 331 260
Total shareholders’ equity 66411 60020 59867
Long-term liabilities
Interest-bearing liabilities 34638 33281 35394
Deferred tax liabilities 1556 1741 1668
Short-term liabilities
Interest-bearing liabilities 8254 10575 8989
Interest-free liabilities 27238 25358 26835
Total liabilities 71686 70955 72886
SHAREHOLDERS’ EQUITY
AND LIABILITIES TOTAL 138097 130975 132753
OLVI GROUP APPENDIX 3
CASH FLOW STATEMENT
EUR 1000
1.1.-30.9.05 1.1.-30.9.04 1.1.-31.12.04
Cash flow
from operations 11630 8455 7279
Depreciation and
other adjustments 7778 7936 11873
Change in net
working capital -1810 -3136 -754
Net financial expenses
and taxes paid -4562 -3008 -4276
Cash flow
from operations(A) 13036 10247 14124
Investments -10845 -8881 -12646
Disposals of fixed assets 84 62 550
Cash flow
from investments (B) -10761 -8819 -12096
Change in debt capital and
other financial items -502 1398 2124
Dividends paid -3259 -3409 -3409
Cash flow from financing(C) -3761 -2011 -1285
Increase (+)/decrease (-)
in liquid assets (A+B+C) -1486 -583 745
Liquid assets 1 January 4436 3691 3691
Liquid assets 30 Jun/31 Dec 2950 3108 4436
APPENDIX 4
CHANGES IN CONSOLIDATED SHAREHOLDERS’ EQUITY
EUR 1000
Shareh. Subscr. Change Change Dividend Profit Shareh.
equity of in in min. payment for equity
1.1.2004 shares tr. and interest period 30.9.2004
ex. diff.
Share
capital 9873 +117 9990
Share
premium
account 10097 +291 10388
Capital
reserve 127 127
Other
reserves 143 143
Change in
exch. diff. -168 -168
Change in
transl. diff. -5 -5
Accrued
earnings 36364 -3409 +6259 39214
Minority
interest 496 -165 331
Shareholders'
equity
total 57100 +408 -173 -165 -3409 +6259 60020
EUR 1000
Shareh. Subscr. Change Change Dividend Profit Shareh.
equity of in in min. payment for equity
1.1.2005 shares tr. and interest period 30.9.2005
ex. diff.
Share
capital 10028 +351 10379
Share
premium
account 10482 +755 11237
Capital
reserve 127 127
Other
reserves 143 143
Change in
exch. diff. +8 8
Accrued
earnings 38828 -3259 +8860 44429
Minority
interest 260 -172 88
Shareholders'
equity
total 59868 +1106 +8 -172 -3259 +8860 64410
APPENDIX 5
NUMBER OF SHARES
1.1.-30.9.05 1.1.-30.9.04 1.1.-31.12.04
- average 5131812 4944026 4958491
- at end of period 5189702 4995202 5014102
- average number of shares
adjusted for dilution
from warrants 5203491 5103121 5105002
PERSONNEL
Finland
Full-time 267 276 270
Part-time 72 67 64
Total 339 343 334
Estonia 366 361 354
Latvia 179 162 164
Lithuania 189 188 180
Total 734 711 698
Olvi Group total 1073 1054 1032
CONTINGENT LIABILITIES
EUR 1000
30.9.05 30.9.04 31.12.04
Pledges and
contingent liabilities
For own commitments:
Mortgages on land
and buildings 1135 1135 1135
Leasing liabilities:
due next year 1992 1696 1696
due later 2378 1880 1735
Total leasing liabilities 4370 3576 3431
Package liabilities 4170 3429 3676
Other liabilities 1980 1980 1980
Debts for which assets have
been pledged as collateral:
Loans from financial institutions
- for others 4724 7554 6924
- for own commitments 3863 5409 5409
DERIVATIVE CONTRACTS
The business significance of derivatives is minor. Some of the
derivative contracts will expire in 2007, some in 2008.
The derivatives have been recognised at fair value on the interim
report. The recognition increased financing expenses by 0.32 million
euro.
APPENDIX 6
RECONCILIATION OF CONSOLIDATED PROFIT (LOSS)
EUR 1000
FAS IFRS IFRS FAS FAS IFRS
7-9/04 adjust- 7-9/04 1-9/04 adjust- 1-9/04
ments ments
Net sales 36062 36062 99899 99899
Other operating
income 112 112 287 287
Materials and
services -13224 -13224 -34295 -34295
Personnel
expenses -4726 -184 - 4910 -14583 -184 -14767
Depreciation and
write-downs -2942 353 -2589 -8733 1082 -7651
Other operating
expenses -11457 -274 -11731 -34744 -274 -35018
Operating profit
(loss) 3825 -105 3720 7831 624 8455
Financial income
and expenses -737 183 -553 -2379 1425 -954
Profit before
taxes 3088 77 3167 5452 2049 7501
Income taxes -615 -615 -1396 -1396
Minority
interest 5 5 153 153
Profit (loss)
for the period 2478 77 2557 4209 2049 6259
FAS IFRS
1-9,2004 1-9,2004
Earnings per share 0.82 1.23
APPENDIX 7
RECONCILIATION OF CONSOLIDATED BALANCE SHEET
Consolidated balance sheet 30 September 2004
EUR 1000 FAS IFRS IFRS
adjust-
ments
ASSETS
Non-current assets
Intangible assets 3521 3521
Goodwill 7654 1052 8706
Tangible assets 69324 -832 68492
Other investments 1033 1033
Non-current assets
available for sale 91 91
Receivables 108 108
Total non-current assets 81640 311 81951
Current assets
Inventories 25369 -653 24716
Receivables 21200 21200
Liquid assets 3108 3108
Total current assets 49677 -653 49024
TOTAL ASSETS 131317 -342 130975
SHAREHOLDERS’ EQUITY AND LIABILITIES
Shareholders’ equity held by
parent company shareholders
Share capital 9990 9990
Reserves 10658 10658
Accrued earnings 35941 -3159 32782
Net profit for the period 4210 2049 6259
Total 60799 -1110 59689
Minority interest 331 331
Total shareholders’ equity 61130 -1110 60020
Long-term liabilities
Interest-bearing
liabilities 33281 33281
Deferred tax liabilities 1699 42 1741
Short-term liabilities
Interest-bearing
liabilities 10575 10575
Interest-free liabilities 24632 726 25358
Total liabilities 70187 768 70955
TOTAL SHAREHOLDERS’
EQUITY AND LIABILITIES 131317 -342 130975
APPENDIX 8
RECONCILIATION OF SHAREHOLDERS’ EQUITY
EUR 1000
1.1.04 30.9.04 31.12.04
Shareholders'
equity
under FAS 60260 61130 59970
IAS 2 -797 -1255 -891
IAS 19 -600 -600 -600
IAS 21 -1707 -282
IAS 12 114 114 114
IFRS 1 -243 -243 -243
IFRS 1 73 104 115
IFRS 3 1052 1402
Shareholders'
equity
under IFRS 57101 60020 59867
Company Address: Olvi plc, Olvitie I-IV, 74100 IISALMI, FINLAND
Website URL: http://www.olvi.fi