LÄNNEN TEHTAAT PLC, Stock Exchange Release, 28 March 2012 at 16:45 (EET)
LÄNNEN TEHTAAT PLC, Stock Exchange Release, 28 March 2012 at 16:45 (EET)
The Annual General Meeting on 28 March 2012 approved the parent company's and
consolidated financial statements for the financial year 1 January - 31
December 2011 and discharged the members of the Supervisory Board and the Board
of Directors and the CEO from liability. The AGM decided to distribute a
dividend of EUR 0.85 per share in accordance with the Board proposal. The Board
of Directors' proposals were approved without changes.
DIVIDEND
The Annual General Meeting decided to distribute as dividend EUR 0.85 per share
on the financial year 2011. The dividend will be paid on 11 April 2012 to
shareholders registered on the company´s register of shareholders kept by
Euroclear Finland Ltd on the record date 2 April 2012. No dividend will be paid
on shares held by the company.
AUTHORISATION FOR SHARE ISSUE
The Annual General Meeting authorised the Board of Directors to decide on
issuing new shares and on the transfer of Lännen Tehtaat shares held by the
company (share issue). The authorisation covers a maximum total of 761,757
shares, and the maximum number of new shares is 631,757, and the number of
Lännen Tehtaat shares held by the company 130,000.
The subscription price for each new share shall be at least the share’s nominal
value, or EUR 2. The transfer price for Lännen Tehtaat shares held by the
company shall be at least the market value of the share at the time of
transfer, which is determined by the price quoted in public trading on NASDAX
OMX Helsinki Ltd. The Board of Directors will also have the right to issue
shares against consideration other than cash. In the case of share-based
incentive systems, shares could also be issued without consideration.
The authorisation includes the right to deviate from the shareholders’
pre-emptive subscription right (targeted issue) if the company has an important
financial reason to do so, such as development of the company’s capital
structure, financing and implementing corporate acquisitions or other
arrangements, or implementing a share-based incentive system.
The authorisation is valid until the Annual General Meeting 2015.
ELECTION OF THE MEMBERS OF THE SUPERVISORY BOARD, THE MEMBERS OF THE
SUPERVISORY BOARD'S NOMINATION COMMITTEE AND THE AUDITORS, AND REMUNERATION
The AGM confirmed that the Supervisory Board will have 19 members elected by
the AGM. Matti Eskola, Laura Hämäläinen, Markku Länninki and Ilkka Markkula
were re-elected. Harri Eela, Jari Nevavuori and Markku Pärssinen were elected
as new members. Samu Pere resigned from the Supervisory Board.
Heikki Laurinen and Tauno Uitto were re-elected as the members of the
Supervisory Board's Nomination Committee.
Hannu Pellinen, APA, and PricewaterCoopers Oy Authorised Public Accountants
with Tomi Moisio, APA, CPFA as responsible auditor, were re-elected as
auditors.
The Annual General Meeting decided that the yearly fee paid to the Supervisory
Board’s chairman is EUR 7,685, and to the deputy chairman EUR 5,125. The
meeting allowance paid to the members of the Supervisory Board and the members
of the Supervisory Board´s Nomination Committee is EUR 255. In addition,
compensation for travelling expenses are paid in accordance with the general
travel rules of Lännen Tehtaat plc. The auditors’ fees are paid according to an
invoice approved by the company.
The minutes of the Annual General Meeting will be available on the company’s
website, www.lannen.fi/en, as of 11 April 2012.
LÄNNEN TEHTAAT PLC, Stock Exchange Release, 27 March 2012 at 14.00 (EET)
LÄNNEN TEHTAAT PLC, Stock Exchange Release, 27 March 2012 at 14.00 (EET)
Lännen Tehtaat plc has acquired from private individuals the entire share
capital of Caternet Finland Oy, a company supplying the food service sector and
specialising in preparing fresh vegetable, fruit and fish products and in
logistics. The company’s net sales in 2011 were approximately EUR 29 million
and its EBITDA figure was EUR 0.6 million. At the close of the last financial
year its net debt stood at approximately EUR 12 million. The total acquisition
price of the share capital is EUR 6-12 million. The acquisition price consists
of a fixed element of EUR 6 million and a variable element comprising an
additional purchase price of EUR 0-6 million, which is tied to the operating
profit for 2012-2013.
“Caternet has a strong position in Finland as a supplier of ready-to-use fresh
products to the hotel, restaurant and catering sector. Caternet’s fresh
products are very suitable additions to Lännen Tehtaat’s current product
selection, which focuses on great taste, healthiness and light choices. The
purchase of Caternet will strengthen Lännen Tehtaat’s position as a food
solutions supplier to the food service sector. Together, with the expertise
and product portfolios of Caternet, Apetit Pakaste and Apetit Kala, Lännen
Tehtaat will be able to improve its customer service in the hotel, restaurant
and catering sector. Caternet has production facilities in Helsinki and sales
and logistics operations in Jyväskylä and Oulu,” says Matti Karppinen, CEO at
Lännen Tehtaat.
The acquisition supports Lännen Tehtaat’s growth strategy and will bring
synergy benefits to the business. Caternet Oy will be reported as part of
Lännen Tehtaat’s Other Operations segment.
LÄNNEN TEHTAAT PLC
Matti Karppinen
CEO
Further information:
Matti Karppinen, CEO, tel. +358 (0)10 402 00
Copies to:
NASDAQ OMX Helsinki Ltd
Main media
www.lannen.fi
Background information on the companies:
Caternet Finland Oy
Caternet Finland Oy is Finland’s leading company specialising in preparing and
supplying additive-free fresh food products. The company prepares ready-to-use
fresh products for the food service sector in a modern production plant with
the highest standards of food hygiene at Kivikko in Helsinki. Caternet’s
product selection is composed of fresh and ready-to-use fruit and vegetable
products and fresh, freshly smoked and frozen fish. The majority of its net
sales are from fruit and vegetables. Its customers are staff restaurants,
hotels, public sector food services, the retail trade and the food industry in
Finland. In 2011, Caternet’s net sales amounted to approximately EUR 29 million
and the company employed about 120 people in Helsinki, Oulu and Jyväskylä. More
information is available on the company’s website at www.caternet.fi.
Lännen Tehtaat plc
Lännen Tehtaat plc is a food industry company whose mission is to offer
consumers food solutions that are healthy, flavoursome and based on locally
sourced raw materials. The Group’s business sectors are the Frozen Foods
business, the Seafood business, the Grains and Oilseeds business and Other
Operations. Lännen Tehtaat operates in the northern Baltic region and its
shares are quoted on NASDAQ OMX Helsinki Ltd. Net sales of the Group in 2011
totalled EUR 335 million and at the end of the year it employed an average of
about 740 people. More information is available on the company’s website at
www.lannen.fi.
LÄNNEN TEHTAAT PLC, Stock Exchange Release, 20 March 2012 at 9.00 (EET)
LÄNNEN TEHTAAT PLC, Stock Exchange Release, 20 March 2012 at 9.00 (EET)
In its financial statements bulletin of 16 February, Lännen Tehtaat gave an
assessment of expected future developments, in which it stated that the accrual
of profit in 2012 is expected to be weighted more strongly towards the end of
the year than it was in 2011.It was stated that this was especially because in
the first six months of 2011 the Grains and Oilseeds business had an
exceptionally good profit.
The Group’s first quarter 2012 operating profit, excluding non-recurring items,
is expected to be short of the previous year’s level and is expected to be
negative, as in the Grains and Oilseeds business the grain trade has been
considerably quieter than previously forecasted and the vegetable oil refining
margin has been down year on year.
In addition, in the financial statements bulletin it was stated that the
Group’s full-year operating profit, excluding non-recurring items, is expected
to be higher than the previous year. Since the profit forecast for the
beginning of the year is lower than anticipated, this also generates
uncertainty regarding realisation of the profit guidance for the full year.
Lännen Tehtaat will publish its Q1 (January-March) interim report on 4 May 2012
at 8.30 a.m.
LÄNNEN TEHTAAT PLC
Matti Karppinen
CEO
Further information:
Matti Karppinen, CEO, tel. +358 (0)10 402 00
Distribution:
NASDAQ OMX Helsinki Ltd
Main media
www.lannen.fi
LÄNNEN TEHTAAT PLC, Stock Exchange Release, 6 March 2012 at 9:00 (EET)
LÄNNEN TEHTAAT PLC, Stock Exchange Release, 6 March 2012 at 9:00 (EET)
Lännen Tehtaat plc’s Annual Report 2011 is published today. The Annual Report
contains the Board of Directors’ report, the parent company financial
statements and consolidated financial statements, the auditor’s report, the
statement by the Supervisory Board and Lännen Tehtaat plc’s Corporate
Governance Statement 2011.
The Annual Report and the Corporate Governance Statement can also be read on
the company’s website at www.lannen.fi/en/investor_information.
The Annual Report will be mailed during the week beginning 12 March, to those
who have ordered it via company’s website www.lannen.fi/en/.
LÄNNEN TEHTAAT PLC
Susanna Sieppi
Communications Manager
Further information: Susanna Sieppi, tel. +358 10 402 4041
Copies to:
NASDAQ OMX Helsinki Ltd
Main media
www.lannen.fi
Attachments:
Lännen Tehtaat_Corporate Governance Statement 2011.pdf
Lännen Tehtaat_Annual Report 2011.pdf
LÄNNEN TEHTAAT PLC Stock Exchange Release 5 March 2012 at 9.30 a.m
Annual General Meeting on 28 March 2012 at 2 p.m.
LÄNNEN TEHTAAT PLC Stock Exchange Release 5 March 2012 at 9.30 a.m
The company’s shareholders are hereby invited to the Annual General Meeting,
which will be held on Wednesday 28 March 2012 at 2.00 p.m. in Lännen Tehtaat
plc’s ‘Myllynkivi’ staff restaurant at Iso-Vimma, Säkylä. The reception of
persons who have registered for the meeting and the distribution of voting
tickets will commence at 12.00 noon.
A. The following agenda items will be dealt with at the meeting:
1. Opening of the meeting
2. Election of chairman of the meeting
3. Election of secretary of the meeting
4. Recording the legality and quoracy of the meeting
5. Election of minutes-checkers and vote counters
6. Approving the agenda and addressing the meeting
7. Recording the attendance at the meeting and adopting the voting list
8. Presentation of the financial statements and the Board of Directors’
report for 2011
9. Presentation of the auditors’ report
10. Presentation of the opinion of the Supervisory Board concerning the
financial statements, the Board of Directors’ report and the auditors’ report
11. Adoption of the financial statements and consolidated financial statements
12. Use of the profit declared in the balance sheet and decision on dividend
payment
The Board of Directors proposes that a dividend of EUR 0.85 per share be paid
for the financial year 2011 on the basis of the adopted balance sheet. The
dividend will be paid to shareholders who are registered in the company’s
shareholder register kept by Euroclear Finland Ltd on 2 April 2012, which is
the record date for the dividend payment. The Board of Directors proposes to
the Annual General Meeting that the dividend payment date be 11 April 2012.
13. Resolution on discharging the members of the Supervisory Board and of the
Board of Directors and the CEO from liability
14. Decision on the number of Supervisory Board members and on their
remuneration
15. Election of the members of the Supervisory Board
16. Election of the two members of the Supervisory Board’s Nomination Committee
17. Decision on the number of auditors and on their remuneration
The Board of Directors proposes that two regular auditors be appointed for the
company. The Board of Directors also proposes that the auditors’ fee be paid in
accordance with the auditing invoice approved by the company.
18. Appointment of auditors
The Board of Directors proposes that the company’s present auditors, Hannu
Pellinen, APA and PricewaterhouseCoopers Oy, Authorised Public Accountants with
Tomi Moisio, APA, CPFA as the auditor with principal responsibility, be
re-elected as auditors for the period ending with the close of the next Annual
General Meeting.
19. Authorisation of the Board of Directors to decide on the issuing of new
shares and on the transfer of Lännen Tehtaat shares held by the company (share
issue)
The Board of Directors proposes that the AGM authorize the Board of Directors
to decide on share issue including the right to issue new shares or to transfer
Lännen Tehtaat shares held by the company. The authorization is proposed to
include a maximum total of 761,757 shares. The maximum number of new shares
that can be issued is 631,757, and the number of Lännen Tehtaat shares held by
the company 130,000.
The subscription price for each of the new shares must be at least the nominal
share value of EUR 2. The transfer price for Lännen Tehtaat shares held by the
company must be at least the current value of the share at the time of
transfer, which is determined by the price quoted in public trading on the
NASDAX OMX Helsinki Ltd. The authorization includes the right to offer shares
also against consideration other than in cash. In the case of share-based
incentive systems, shares can be issued without remuneration.
The authorization includes the right to deviate from the shareholders’
pre-emptive subscription right (targeted issue) if the company has a
substantial financial reason to do so, such as development of the company’s
capital structure, financing and implementing corporate acquisitions or other
arrangements, or implementing a share-based incentive system.
It is proposed that the authorization be valid until the Annual General Meeting
2015.
20. Closing of the meeting
B. Documents of the General Meeting
The proposals of the Board of Directors and the invitation to the meeting are
available on Lännen Tehtaat’s website at www.lannen.fi/en. The company’s
financial statements will be available on the above-mentioned website no later
than 6 March 2012 onwards. Copies of these documents will be sent to
shareholders upon request and they will also be available at the Annual General
Meeting. The minutes of the Annual General Meeting will be available on the
above-mentioned website as from 11 April 2012.
C. Instructions for participants in the Annual General Meeting
Right to participate and registration
Shareholders whose shares have been registered in the register of shareholders
kept by Euroclear Finland Ltd not later than 16 March 2012 have the right to
attend the Annual General Meeting.
Shareholders wishing to participate in the Annual General Meeting must notify
the company of this no later than 4.00 p.m. on Friday 23 March 2012 either on
the company web pages at www.lannen.fi/en, in writing to Lännen Tehtaat plc,
P.O. Box 100, FI-27801 Säkylä, Finland, by fax +358 10 402 4023, by phone +358
10 402 4044/Maija Lipasti or by e-mail . If notice is
given by letter, this must arrive before the expiry of the notification period.
Any proxy documents should be delivered to the above-mentioned address before
the expiry of notification period.
Pursuant to chapter 5, section 25 of the Limited Liability Companies Act,
shareholders who are present at the Annual General Meeting have the right to
request information on matters considered at the meeting.
Proxies and proxy documents
Shareholders may participate in and exercise their rights at the Annual General
Meeting by means of proxy representation. A shareholder’s proxy must produce a
dated proxy document or must otherwise demonstrate reliably his/her right to
represent the shareholder at the Annual General Meeting. If a shareholder
participates in the meeting by means of several proxies, who represent the
shareholder with shares in different book-entry accounts, the shares with which
each proxy represents the shareholder must be notified in connection with the
registration for the Annual General Meeting.
Any proxy documents should be delivered as originals to Lännen Tehtaat plc no
later than the expiry of the notification period at 4.00 p.m. on 23 March 2012.
Holders of nominee registered shares
Holders of nominee registered shares are advised to request from their asset
manager without delay the necessary instructions regarding registration in the
company’s shareholder register, the provision of proxy documents and
registration for the Annual General Meeting. The asset manager’s account
management organisation will register a holder of nominee registered shares who
wants to participate in the meeting, for temporary entry in the company’s
shareholder register no later than 10.00 a.m. on 23 March 2012.
Other instructions and information
On the date of this notice, Lännen Tehtaat plc’s total number of shares and
votes is 6,317,576.
The company’s Annual Report, including the financial statements, the Board of
Directors’ report and the statement of the Supervisory Board, will be published
on week 10 in Finnish and English on Lännen Tehtaat plc’s website, at
www.lannen.fi. The English version is a translation of the Finnish. A printed
version of the Annual Report can be ordered via Lännen Tehtaat plc´s website at
the internet address stated above. Mailing of the printed Annual Reports will
begin in week 11.
LÄNNEN TEHTAAT PLC FINANCIAL STATEMENTS BULLETIN 1 JANUARY - 31 DECEMBER 2011
Fourth quarter (October-December) in brief:
LÄNNEN TEHTAAT PLC FINANCIAL STATEMENTS BULLETIN 1 JANUARY - 31 DECEMBER 2011
-- Consolidated fourth-quarter net sales came to EUR 80.4 (87.9) million,
which was a year-on-year decrease of almost 9%.
-- Operating profit, excluding non-recurring items, came to EUR 4.6 (5.1)
million; non-recurring items totalled EUR 0.6 (0.0) million.
-- Profit for the quarter was EUR 4.4 (4.4) million, and earnings per share
amounted to EUR 0.69 (0.71).
Financial year (January–December) in brief:
-- Consolidated net sales for 2011 amounted to EUR 335.5 (308.7) million,
which was a year-on-year increase of almost 9%.
-- Operating profit, excluding non-recurring items, came to EUR 9.8 (8.3)
million; non-recurring items totalled EUR -1.1 (0.0) million.
-- Profit for the year came to EUR 5.7 (6.5) million, and earnings per share
amounted to EUR 0.92 (1.04).
The Board of Directors will propose to the Annual General Meeting that a
dividend of EUR 0.85 (0.90) per share be paid.
The information in this bulletin has not been audited. The figures in
parentheses are the equivalent figures for the same period a year earlier,
unless stated otherwise.
Key figures
EUR million Q4/ Q4/ Change Q1-Q4/ Q1-Q4/ Change
2011 2010 2011 2010
--------------------------------------------------------------------------------
Net sales 80.4 87.9 -9% 335.5 308.7 9%
--------------------------------------------------------------------------------
Operating profit, excluding 4.6 5.1 9.8 8.3
non-recurring items
--------------------------------------------------------------------------------
Operating profit 5.1 5.1 8.7 8.3
--------------------------------------------------------------------------------
Profit before taxes 5.1 5.1 7.5 8.4
--------------------------------------------------------------------------------
Profit for the period 4.4 4.4 5.7 6.5
--------------------------------------------------------------------------------
Earnings per share, EUR 0.69 0.71 0.92 1.04
--------------------------------------------------------------------------------
Equity per share, EUR 22.06 22.01
--------------------------------------------------------------------------------
Equity ratio, % 74.9 72.4
--------------------------------------------------------------------------------
Return on equity (ROE), % 4.1 4.7
--------------------------------------------------------------------------------
Return on investment (ROI), % 6.3 6.1
--------------------------------------------------------------------------------
Matti Karppinen, CEO:
“The Group’s operating profit, excluding non-recurring items, showed a
year-on-year improvement, as anticipated. The final quarter was the strongest,
which is typically the case, although it was slightly down on the previous
year.
The full-year result for the Seafood business was particularly gratifying,
climbing into profit in the final quarter. Seafood’s improved performance was
from its operations in Finland, where the determined efforts to develop the
business and improve efficiency bore fruit. The Grains and Oilseeds business
posted an extremely good result: it’s best ever full-year profit. The profit in
Frozen Foods was almost at the previous year’s level, while Other Operations
turned in a result that was significantly down year on year, due to the weak
figure for associated company profits. The associated company Sucros performed
disappointingly; the associated company profit decreased by over 70%.
Besides Seafood’s growth and profit improvement, the year’s other successes
included the Kotimaiset frozen product range and the frozen vegetables and new
frozen ready meals for the hotel, restaurant and catering sector, sales of
which grew considerably, and also the completion and start-up of the packaging
plant at the Kirkkonummi vegetable oil mill.”
Outlook for 2012
The Group’s net sales will be affected particularly by the level of activity in
the grain and oilseed markets and by changes in the price level of grains and
oilseeds.
Thanks to the measures taken to develop the Group’s different businesses, the
full-year operating profit, excluding non-recurring items, is expected to be
higher than the previous year.
The accrual of Lännen Tehtaat’s annual profit is typically weighted towards the
end of the year, due to the nature of operations in the Frozen Foods business,
the Seafood business and the associated company Sucros. The accrual of profit
in 2012 is expected to be weighted more strongly towards the end of the year
than it was in 2011. During the first six months of 2012, the Grains and
Oilseeds business is not expected to reach the record high profit level of
2011. Profit performance in the Seafood and Frozen Foods businesses is expected
to continue its steady improvement, although the result in the Norwegian and
Swedish Seafood business will be burdened by high raw material costs in the
early part of the year.
Board of Directors’ dividend proposal
The parent company’s distributable funds totalled EUR 87,683,571.91 on 31
December 2011, of which EUR 8,740,302.05 is profit for the financial year.
The Board of Directors’ proposal is that a dividend of EUR 0.85 per share be
distributed for 2011. The Board will propose that a total of EUR 5,259,439.60
be distributed in dividends and that EUR 82,424,132.31 be left in equity. The
proposed dividend is 92.4% of the earnings per share.
No dividend will be paid on shares held by the company.
New publication practice
In compliance with the new publication practice permitted under Financial
Supervisory Authority standard 5.2b, Lännen Tehtaat plc is publishing its
Financial Statements Bulletin as a PDF attachment to this stock exchange
release.
The Financial Statements Bulletin is also available on the company’s website at
www.lannen.fi/en/investor_information.
Publication of Annual Report and Annual General Meeting
Lännen Tehtaat’s 2011 Annual Report, containing the Board of Directors’ Report
and Financial Statements for 2011 and a separate Lännen Tehtaat plc’s Corporate
Governance Statement 2011, will be published on its website at
www.lannen.fi/en/investor_information in the week beginning 5 March 2012. The
printed version of the Annual Report will be published during the week
beginning 12 March.
The Annual General Meeting is planned for 28 March 2012 and will be held at
Säkylä.
The company will publish its Interim Report for Q1/2012, on Friday 4 May 2012
at 8.30 a.m.
Additional information from:
Matti Karppinen, CEO, tel. +358 (0)10 402 00
***************
Invitation to news briefing
CEO Matti Karppinen will present Lännen Tehtaat’s 2011 results to analysts and
the media at a news briefing given in Finnish today, 16 February 2012, at 10.00
a.m. The news briefing will be held at the Scandic Simonkenttä hotel in
Helsinki (address: Simonkatu 9).
The news briefing presentation material will be available on the company’s
website at www.lannen.fi/en/investor_information after the news briefing.
COPIES TO:
NASDAQ OMX Helsinki Ltd
Main media
www.lannen.fi.
Attachments:
Lännen Tehtaat plc Financial Statements Bulletin for 2011
LÄNNEN TEHTAAT PLC Stock Exchange Release 16 February 2012 at 8.30 a.m.
I DIVIDEND
LÄNNEN TEHTAAT PLC Stock Exchange Release 16 February 2012 at 8.30 a.m.
The Board of Directors proposes to the Annual General Meeting that a dividend
of EUR 0.85 per share be paid on the financial year 2011.
II ELECTION OF THE AUDITOR AND FEES
The Board of Directors' proposes that the auditor's fee be reimbursed according
to invoice approved by the company.
The Board of Directors proposes that Hannu Pellinen, APA, and
PricewaterhouseCoopers Oy Authorized Public Accountants with Tomi Moisio, APA,
CPFA as responsible auditor, be re-elected as the auditors to the close of the
following Annual General Meeting.
III AUTHORIZATION FOR SHARE ISSUE
The Board of Directors proposes that the AGM authorize the Board of Directors
to decide on share issue including the right to issue new shares or to transfer
Lännen Tehtaat shares held by the company. The authorization is proposed to
include a maximum total of 761,757 shares. The maximum number of new shares
that can be issued is 631,757, and the number of Lännen Tehtaat shares held by
the company 130,000.
The subscription price for each of the new shares must be at least the nominal
share value of EUR 2. The transfer price for Lännen Tehtaat shares held by the
company must be at least the current value of the share at the time of
transfer, which is determined by the price quoted in public trading on the
NASDAX OMX Helsinki Ltd. The authorization includes the right to offer shares
also against consideration other than in cash. However, in the case of
share-based incentive systems, shares can be issued without remuneration.
The authorization includes the right to deviate from the shareholders’
pre-emptive subscription right (targeted issue) if the company has a
substantial financial reason to do so, such as development of the company’s
capital structure, financing and implementing corporate acquisitions or other
arrangements, or implementing a share-based incentive system.
It is proposed that the authorization be valid until the Annual General Meeting
2015.
LÄNNEN TEHTAAT PLC
Board of Directors
For more information, CEO Matti Karppinen, tel. +358 10 402 00
Distribution:
NASDAQ OMX Helsinki Ltd
Main media
www.lannen.fi
LÄNNEN TEHTAAT PLC Stock Exchange Release 3 February 2012 at 15.15 (EET)
LÄNNEN TEHTAAT PLC Stock Exchange Release 3 February 2012 at 15.15 (EET)
In its announcement issued on 3 February 2012, Nordic Sugar stated that it has
presented a compensation claim of EUR 4.5 million to Lännen Tehtaat for breach
of shareholder agreement. No compensation claim has been presented to Lännen
Tehtaat.
Lännen Tehtaat has requested the Arbitration Institute of the Central Chamber
of Commerce of Finland to appoint a chairman to the arbitration court in a
dispute concerning Nordic Sugar’s breaches of shareholder agreement. In Nordic
Sugar’s response to Lännen Tehtaat’s application, which was submitted to the
Central Chamber of Commerce’s Arbitration Tribunal by Nordic Sugar, Nordic
Sugar expressed the view that Lännen Tehtaat committed a breach of shareholder
agreement in connection with the dismissal of Sucros Ltd’s managing director,
and requests the arbitration court to confirm the breach of shareholder
agreement and order Lännen Tehtaat to pay a contractual penalty of EUR 4.5
million.
“Lännen Tehtaat’s view is that the shareholder agreement was complied with in
the dismissal of Sucros Ltd’s managing director, and so the compensation claim
is unfounded. Under the shareholder agreement, both shareholders are entitled
to demand the managing director’s dismissal if confidence in the managing
director has been lost and cannot be restored,” says Chief Executive Officer
Matti Karppinen.
On 14 October 2011, Lännen Tehtaat published an announcement in which it
reported that a dispute concerning breaches of shareholder agreement is being
taken to arbitration court. According to Lännen Tehtaat, Nordic Sugar is guilty
of three different breaches, and on the basis of these Lännen Tehtaat is
demanding a contractual penalty totalling of EUR 27 million. The arbitration
will begin after appointment of a chairman. In addition, Lännen Tehtaat plc has
submitted to the Regional State Administrative Agency for Southern Finland an
application requesting a special audit of the accounts of Sucros Ltd in
connection with e.g. business transactions between Sucros and Nordic Sugar
Groups companies.
LÄNNEN TEHTAAT PLC Stock Exchange Announcement 16 January 2012 at 14.45 (EET)
Funds managed by SKAGEN AS have notified that they on 13 January 2012 sold some
shares of Lännen Tehtaat plc (business ID 0197395-5), and the total ownership
has thus decreased under 5% of the company´s total share capital.
LÄNNEN TEHTAAT PLC Stock Exchange Announcement 16 January 2012 at 14.45 (EET)
After the share transactions made on 13 January 2012, the ownership of the
Funds managed by SKAGEN AS is 314,236 shares corresponding 4.97 % of the
outstanding share capital and 5.08 % of voting rights in Lännen Tehtaat plc.
LÄNNEN TEHTAAT PLC
Susanna Sieppi
Communications Manager
For additional information:
Matti Karppinen, CEO, tel. +358 10 402 4001
Distribution:
NASDAQ OMX Helsinki Ltd
Main media
www.lannen.fi
Lännen Tehtaat plc, Stock Exchange Release, 10 January 2012 at 14:00 (EET)
Lännen Tehtaat plc, Stock Exchange Release, 10 January 2012 at 14:00 (EET)
Lännen Tehtaat plc has published on its internet site a summary of the
company's stock exchange releases published during the year 2011. The summary
is available at www.lannen.fi/en under Stock Exchange Releases – Summary of
Stock Exchange.
Since the releases apply to events in 2011, some of the information given in
the releases may be outdated.
LÄNNEN TEHTAAT PLC
Susanna Sieppi
Communications Manager
Further information: Susanna Sieppi, tel. +358 10 402 4041
LÄNNEN TEHTAAT PLC STOCK EXCHANGE RELEASE 21 December 2011 at 13:00 (EET)
Lännen Tehtaat plc will publish the following financial reports in 2012:
LÄNNEN TEHTAAT PLC STOCK EXCHANGE RELEASE 21 December 2011 at 13:00 (EET)
-- Financial Statements Bulletin 2011, Thursday 16 February 2012 at 8:30
-- Annual Report 2011, Week 10, 2012
-- Interim Report January-March, Friday 4 May 2012 at 8:30
-- Interim Report January-June, Wednesday 15 August 2012 at 8:30
-- Interim Report January-September, Friday 9 November 2012 at 8:30
Lännen Tehtaat plc will hold its Annual General Meeting on Wednesday 28 March
2012. The Board of Directors will give a separate invitation to the Annual
General Meeting at a later date.
The financial reports are published in Finnish and English and are available on
the company’s web pages at www.lannen.fi
LÄNNEN TEHTAAT PLC
Eero Kinnunen
CFO
Further information:
Eero Kinnunen, tel. +358 10 402 4025
Distribution:
NASDAQ OMX Helsinki Ltd
Main media
www.lannen.fi/en
July-September:
- Consolidated net sales came to EUR 77.6 (65.9) million, up by 18%.
- Operating profit, excluding non-recurring items, was EUR 2.3 (1.3) million; there were no non-recurring items.
- Profit for the period came to EUR 1.3 (0.7) million, and earnings per share amounted to EUR 0.20 (0.10).
LÄNNEN TEHTAAT PLC Interim Report 2 November 2011, 8.30 am
January-September:
- Net sales came to EUR 255.1 (220.8) million, up by 16%.
- Operating profit, excluding non-recurring items, was EUR 5.3 (3.2) million; non-recurring items totalled EUR -1.7 (0.0) million.
- Profit for the period came to EUR 1.2 (2.1) million, and earnings per share amounted to EUR 0.23 (0.34).
The assessment of profit performance for the full year is unchanged. Thanks to the measures taken to develop the Group's different businesses and the corporate acquisitions made in 2010, the full-year operating profit, excluding non-recurring items, is expected to be better than the previous year's level.
The information in this Interim Report has not been audited.
Matti Karppinen, CEO:
“The Group's third-quarter net sales and profitability improved overall, as forecast. Operating profit for the quarter was up by EUR 1 million year on year, and net sales increased by 18%. Both the Frozen Foods and Seafood businesses turned in a better result than a year earlier. The result for the Grains and Oilseeds business was also slightly up on the previous year. The poor result for the associated company Sucros was disappointing in view of expectations and in comparison with the same period a year ago.
“The development of the Seafood business and improvements in its efficiency continued according to plan in Finland and Norway. Apetit Kala strengthened its position in the fresh fillet and fresh salmon market. In Norway, production at Fredrikstad was concentrated at a single plant. In the Frozen Foods business, marketing has been very successful. According to the latest Brandflow survey, Apetit is by far the best known frozen foods brand and the Finnishness campaign has increased sales of frozen vegetables and frozen potato products. The Grains and Oilseeds business is currently completing its largest investment in years. The new packaging plant will support sales growth in packaged oils.
“All of this provides a good basis from which we can now move forward.”
Net sales 77.6 65.9 255.1 220.8 308.7
Operating profit, excluding non-recurring items 2.3 1.3 5.3 3.2 8.3
Operating profit 2.3 1.3 3.6 3.2 8.3
Profit before taxes 2.0 1.2 2.4 3.3 8.4
Profit for the period 1.3 0.7 1.2 2.1 6.5
Earnings per share, EUR 0.20 0.10 0.23 0.34 1.04
NET SALES AND PROFIT
July-September:
Consolidated net sales for the third quarter amounted to EUR 77.6 (65.9) million, up by 18% on the previous year. Net sales were up in all businesses.
The Group's operating profit, excluding non-recurring items, was EUR 2.3 (1.3) million. There were no non-recurring items. The operating profit includes EUR -0.2 (0.6) million as the share of the profits of associated companies. The quarter's operating profit was up year on year in all businesses with the exception of the Other Operations segment, in which the share of the profits of associated companies was below the previous year's figure.
January-September:
Consolidated net sales for January-September came to EUR 255.1 (220.8) million, up by 16%.
The operating profit, excluding non-recurring items, was EUR 5.3 (3.2) million. The operating profit includes EUR -0.1 (0.8) million as the share of the profits of associated companies. Non-recurring items totalled EUR -1.7 (0.0) million. The non-recurring items were related to the efficiency boosting measures in the Seafood business.
The net figure for financial income and expenses was EUR -1.2 (0.1) million. This includes valuation items of EUR -0.2 (0.8) million with no cash flow implications. Financial expenses also include EUR -0.8 (-0.6) million as the share of the Avena Nordic Grain Group's profit attributable to the employee owners of Avena Nordic Grain Oy. Due to changes in ownership during the spring, the employee owners' holding in Avena Nordic Grain Oy rose from 14.6% to 17.1%.
Profit before taxes was EUR 2.4 (3.3) million. The profit for the period was EUR 1.2 (2.1) million, and earnings per share amounted to EUR 0.23 (0.34).
FINANCING AND BALANCE SHEET
The Group's liquidity was good and its financial position is strong.
The cash flow from operating activities in January-September after interest and taxes amounted to EUR -3.3 (-3.1) million. The impact of the change in working capital was EUR -6.1 (-7.3) million.
The net cash flow from investing activities was EUR 3.2 (6.9) million. Deposits and withdrawals of cash assets invested in short-term fixed income funds had an impact of EUR 7.1 (13.0) million on the net cash flow from investing activities. The cash flow from financing activities was EUR -0.6 (-4.7) million, including EUR 4.9 (0.4) million in loan withdrawals and repayments and EUR -5.6 (-4.7) million in dividend payments. The net change in cash and cash equivalents was EUR -0.7 (-0.8) million.
At the end of the period the Group had EUR 10.2 (3.5) million in interest-bearing liabilities and EUR 6.8 (11.4) million in liquid assets. Net interest-bearing liabilities totalled EUR 3.4 (-7.9) million. The consolidated balance sheet total stood at EUR 187.9 (178.5) million. At the end of the review period, equity totalled EUR 134.9 (134.8) million. The equity ratio was 71.8% (75.6%). The Group's liquidity is being secured with committed credit facilities. EUR 17 (25) million was available in credit at the end of the period. EUR 8.0 (0.0) million was drawn in credit to finance working capital.
INVESTMENT
Investment in non-current assets during January-September totalled EUR 4.6 (2.6) million.
PERSONNEL
The average number of personnel in the review period was 619 (615).
Third-quarter net sales in the Frozen Foods business increased by 4% year on year. Sales to the retail sector were at the same level as a year earlier. Sales started to increase at the end of the period. Sales of products under the Apetit brand performed better than retailers' private labels. Strong growth continued in sales to the hotel, restaurant and catering sector, as a result of new products. Exports of frozen peas were up year on year due to the good domestic crop.
The third-quarter operating profit was better than in the same quarter the previous year. This was attributable to the product mix in sales and the earlier start to frozen vegetable production, focusing more on the third quarter than in the previous year.
The net sales for January-September increased slightly year on year. Sales of frozen vegetables performed well in both the retail sector and the hotel, restaurant and catering sector. After the weak performance in the first half of the year, sales of frozen potato products also started to increase. Sales of the Kotimaiset (“Finnish grown”) range of frozen vegetables were very good, improving further at the end of the period. Sales of frozen ready meals to the hotel, restaurant and catering sector grew by more than a quarter. Sales of frozen pizzas were down on the previous year.
Operating profit for January-September was at the level of the previous year. Price rises carried out in the first half of the year only partially compensated for the strong rises in raw material and energy prices. Due to cost pressures, further price rises will be introduced during the last quarter of the year.
Processing of the autumn's crops has proceeded well. The growing season weather was favourable for the vegetables and root vegetables of Finnish contract growers. In the summer, a high-quality and ample crop of spinach and peas was harvested, and the volume of potatoes for freezing will be sufficient. The rainy weather in late autumn has hampered the harvesting of root vegetables on the contract farms, but despite the difficult harvesting conditions it appears that a sufficient volume of good quality root vegetables will be obtained for freezing.
The average number of personnel in Frozen Foods during January-September was 200 (191).
Investment totalled EUR 1.7 (1.1) million during the period. The most significant items were replacement investments in frozen vegetable production and investments in energy efficiency.
The third-quarter net sales of the Seafood business were up by 4% on the same quarter a year earlier. This growth was attributable to the Finnish Seafood business.
Net sales in the Finnish Seafood business were up by about 11% as a result of increased volumes in the sales of fresh fillets and fresh salmon. Net sales were adversely affected by the lower number of Kalatori service counters compared with the previous year.
In the Norwegian and Swedish Seafood business, net sales fell by about 6% year on year both in euro terms and in local currencies. The decrease in net sales was due to discontinuing the sale of smoked fish products, the decline in the sale of certain shellfish products due to raw material availability problems, and lower sales of canned products compared with the previous year. Growth in the sales of dressings and fishcakes and fishballs continued.
The Seafood business's third-quarter operating profit, excluding non-recurring items, improved by EUR 1.5 million year on year. This profit improvement occurred in the Seafood business in Finland and in Norway and Sweden. The operating profit for the period included EUR 0.5 (-0.3) million as changes in the fair value of currency hedges.
The Finnish Seafood business posted a year-on-year improvement in its third-quarter operating profit, excluding non-recurring items, which was attributable to sales growth, improved gross margin and decreased overhead costs. The Taimen Group's impact on the quarterly profit was similar to the previous year, at EUR 0.3 (0.4) million.
The improved third-quarter operating profit of the Norwegian and Swedish Seafood business is a result of changes in fair value of currency hedges. Gross margin was down year on year as a result of higher prices for key raw materials and packaging materials than the year before. The increased sales prices that will compensate for higher costs will come into effect during the final quarter. Overhead costs were lower than in the same period the previous year. Measures to improve productivity and cost-effectiveness, and thus boost financial performance, continued in the Norwegian and Swedish units. The closure of the Stabburveien plant and the associated measures required for concentrating production proceeded according to plan during the period.
Seafood's net sales for January-September were up by 9% on the same period in 2010. Net sales of the Finnish Seafood business were up by 17%. However, net sales of Seafood's Norwegian and Swedish operations in euros fell by 2%. The decrease in net sales was entirely attributable to the discontinuing of smoked fish sales.
The Seafood business's operating profit for January-September, excluding non-recurring items, improved by EUR 1.9 million year on year. Non-recurring items totalled EUR -1.7 (0.0) million. The share of the profit of associated companies was EUR 0.4 (0.3) million. The improved profit for the review period was mainly attributable to the Finnish Seafood business. The changes in the fair value of currency hedges affected Seafood's operating profit during the review period by EUR 0.4 (-0.3) million.
The number of personnel in the Seafood business averaged 348 (354).
Investment in the Seafood business totalled EUR 0.6 (0.8) million. The main items during the review period were replacement investments at different production plants in Finland, Norway and Sweden.
Third-quarter net sales in the Grains and Oilseeds business were up by 29% year on year. This growth was attributable to higher market prices than the year before. Delivery volumes fell short of the figures for the same quarter a year earlier, although they did rise at the end of the period. Most of the net sales growth originated from exports and trading outside Finland.
The operating profit in Grains and Oilseeds was at the level of a year earlier.
Net sales in January-September were up by 22% year on year due to higher market prices. Operating profit was EUR 1.3 million better than a year earlier.
Due to the improved weather conditions at the end of the growing season and during the harvesting season, the EU's grain crop increased to 279 (273) million tonnes and the oilseeds crop came to 27.9 (28) million tonnes. However, there is considerable variation in quality. In Russia, Ukraine and Kazakhstan, harvests were significantly greater than in 2010, and the Black Sea region is currently dominating the global wheat export market. Due to relatively low stocks and continued good demand, prices on the global market have remained at a historically very high level even during the new crop year.
An average grain crop was harvested in Finland, amounting to 3.5 million tonnes; in 2010, the crop was only around 3 million tonnes. The bread grain crop was larger than average and generally of a good quality. The Information Centre of the Ministry of Agriculture and Forestry estimates that, due to reduced areas under cultivation and low per-hectare yields, the rapeseed crop will be no more than 130,000 tonnes, while in 2010 the crop was 180,000 tonnes.
Large variations in the quality of crops as well as varying yields in different areas under cultivation will affect grain flows and the formation of supply and demand in different markets, which will create plenty of trading opportunities during the crop year.
The Grains and Oilseeds business employed an average of 60 (60) people in the first nine months of the year.
Investment totalled EUR 2.2 (0.6) million in January-September and was mainly on the packaging plant being constructed at the Kirkkonummi vegetable oil mill. The packaging plant will be completed according to plan by the end of the year. The packaging plant is at the trial operation phase, and customer deliveries from the new packaging plant will commence by the end of the year. This investment will boost Avena's competitiveness in the market for packaged vegetable oil products.
Other Operations comprise the service company Apetit Suomi Oy, Group Administration, items not allocated under any of the business segments, and the associated companies Sucros Ltd and Ateriamestarit Oy. The cost of services produced by Apetit Suomi Oy is an encumbrance on the operating profit of the Group's businesses in proportion to their use of the services.
Net sales from the sale of services were at the previous year's level.
The third-quarter operating profit fell short of the previous year due to the fall in the share of profits of the associated company Sucros, which suffered from the high cost of imported raw materials. The operating profit includes EUR -0.5 (0.2) million as the share of the profits of associated companies.
The EUR -3.1 (-2.0) million operating profit for January-September includes EUR -0.4 (0.5) million as the share of the profits of associated companies.
The segment's investment totalled EUR 0.1 (0.1) million.
USE OF THE AUTHORISATIONS GRANTED TO THE BOARD OF DIRECTORS
Authorisations to issue shares
The Board of Directors has not exercised the authorisation granted to it by the Annual General Meeting on 31 March 2011 to issue new shares or to transfer Lännen Tehtaat plc shares held by the company.
SHARES AND TRADING
The number of Lännen Tehtaat plc shares traded on the stock exchange during January-September was 528,445 (917,244), representing 8.4% (14.5%) of the total number of shares. The euro-denominated share turnover was EUR 8.5 (16.1) million. The highest share price quoted was EUR 18.80 (20.00) and the lowest EUR 12.95 (15.51). The average price of shares traded was EUR 16.12 (17.60).
At the end of September, the market capitalisation totalled EUR 90.5 (116.6) million.
At the end of the period, the company held 130,000 of its own shares, with a combined nominal value of EUR 0.26 million. These treasury shares represent 2.1% of the company's total number of shares and total number of votes.
FLAGGING ANNOUNCEMENTS
No flagging announcements were made during January-September.
SEASONALITY OF OPERATIONS
In accordance with the IAS 2 standard, the historical cost of inventories includes a systematically allocated portion of the fixed production overheads. In production that focuses on seasonal crops, raw materials are processed into finished products mainly during the final quarter of the year, which means that the inventory volumes and their balance-sheet values are at their highest at the end of the year. Since the entry of the fixed production overheads included in the historical cost as an expense item is deferred until the time of sale, the accrual of the Group's annual profit is weighted towards the final quarter. The seasonal nature of operations is most marked in Frozen Foods and in the associated company Sucros, due to the link between production and the crop harvesting season.
In the Seafood business, the sales of Apetit Kala Oy and Myrskylän Savustamo Oy peak at weekends and on holidays. A significant proportion of the entire year's profit in the Seafood business depends on the success of the Christmas season. The profit accumulated by the Taimen Group, which reports as an associated company, is normally smaller during the summer months than at other times of the year, due to the growing season for fish. Net sales in the Grains and Oilseeds business vary from one year and quarter to the next to a greater extent than in the other businesses, being dependent on the demand and supply situation and on the price levels domestically and on other markets.
SHORT-TERM RISKS AND UNCERTAINTIES
The most significant short-term risks for the Lännen Tehtaat Group concern the following: the management of raw material price changes and currency risks; availability of raw materials; the impact of the rise in energy prices; the success of the Christmas season in the Seafood business; price competition in the seafood market; the change in Seafood's production plant structure in Norway; the solvency of customers and the delivery performance of suppliers and service providers; changes within the Group's business sectors and customer relationships; and the integration processes following the corporate acquisitions made.
SIGNIFICANT EVENTS SINCE THE END OF THE REVIEW PERIOD
In October, Lännen Tehtaat decided to take the dispute between Lännen Tehtaat and Nordic Sugar regarding breaches of the shareholder agreement to arbitration.
Lännen Tehtaat and Nordic Sugar are now in a situation in the operations of Sucros Ltd in which Lännen Tehtaat is of the opinion that its minority rights have repeatedly been violated by the decision-making and actions of the majority owner. In spite of several complaints, the majority owner has not rectified the actions that are in breach of the shareholder agreement, and therefore Lännen Tehtaat plc decided to take the issue to arbitration to be resolved. In its rejoinder to Lännen Tehtaat, Nordic Sugar has denied the breaches of shareholder agreement.
According to Lännen Tehtaat, Nordic Sugar has committed 3 breaches against the agreement. According to the terms and conditions of the shareholder agreement, one proven breach will incur a contractual penalty totalling EUR 8.9 million per breach. Therefore the penalty could total a maximum of nearly EUR 27 million.
ASSESSMENT OF PROBABLE FUTURE DEVELOPMENT
The Group's net sales will be affected particularly by the level of activity in the grain and oilseed markets and by changes in the price level of grains and oilseeds. Based on developments so far and on the current outlook, the Group's full-year net sales are expected to be up on the 2010 figure.
Thanks to the measures taken to develop the Group's different businesses, and the corporate acquisitions made in 2010, the full-year operating profit, excluding non-recurring items, is expected to be better than the previous year's level.
The profit for the financial year will be depressed by non-recurring costs associated with the Seafood business's efficiency improvement measures reported in the second quarter. There were no non-recurring costs in 2010.
CONSOLIDATED INCOME STATEMENT
EUR million Q3 Q3 Q1-Q3 Q1-Q3 Q1-Q4
2011 2011 2011 2010 2010
Net sales 77.6 65.9 255.1 220.8 308.7
Other operating income 0.7 0.2 1.1 0.8 1.4
Operating expenses -74.3 -64.1 -248.3 -215.2 -299.4
Depreciation -1.4 -1.4 -4.3 -4.0 -5.3
Impairments 0.0 0.0 0.0 0.0 -0.1
Share of profits of associated companies -0.2 0.6 -0.1 0.8 3.0
Operating profit 2.3 1.3 3.6 3.2 8.3
Financial income and expenses -0.3 0.0 -1.2 0.1 0.1
Profit before taxes 2.0 1.2 2.4 3.3 8.4
Income taxes -0.7 -0.5 -1.2 -1.2 -1.9
Profit for the period 1.3 0.7 1.2 2.1 6.5
Attributable to
Equity holders of the parent 1.2 0.7 1.4 2.1 6.5
Non-controlling interests 0.0 -0.2
Basic and diluted earnings per share,
calculated of the profit attributable to the
shareholders of the parent
company, EUR 0.20 0.10 0.23 0.34 1.04
STATEMENT OF COMPREHENSIVE
INCOME
EUR million Q3 Q3 Q1-Q3 Q1-Q3 Q1-Q4
2011 2010 2011 2010 2010
Profit for the period 1.3 0.7 1.2 2.1 6.5
Other comprehensive income
Cash flow hedges -0.4 0.1 1.0 -0.6 1.1
Taxes related to cash flow hedges 0.1 0.0 -0.3 0.2 -0.3
Translation differences -0.2 0.1 -0.2 0.6 0.8
Total comprehensive income 0.7 0.9 1.7 2.2 8.1
Attributable to
Equity holders of the parent 0.7 0.9 1.9 2.2 8.1
Non-controlling interests 0.0 -0.2
CONSOLIDATED STATEMENT OF FINANCIAL
POSITION
EUR million 30 Sept 30 Sept 31 Dec
2011 2010 2010
ASSETS
Non-current assets
Intangible assets 5.4 6.1 6.0
Goodwill 8.7 8.5 8.6
Tangible assets 37.6 37.7 37.0
Investment in associated companies 33.3 31.7 33.9
Available-for-sale investments 0.1 0.1 0.1
Receivables 0.4 0.5 0.7
Deferred tax assets 1.9 1.4 1.4
Non-current assets total 87.3 86.0 87.5
Current assets
Inventories 59.5 51.6 55.0
Receivables 34.0 29.5 34.5
Income tax receivable 0.3 0.2
Financial assets at fair value through profits 4.4 7.1
Cash and cash equivalents 6.8 7.0 7.5
Current assets total 100.6 92.5 104.4
Total assets 187.9 178.5 191.9
EUR million 30 Sept 30 Sept 31 Dec
2011 2010 2010
EQUITY AND LIABILITIES
Equity attributable to the equity
holders of the parent 132.4 131.9 136.2
Non-controlling interests 2.6 2.9 2.7
Total equity 134.9 134.8 138.9
Non-current liabilities
Deferred tax liabilities 3.9 3.9 4.4
Long-term financial liabilities 1.8 2.5 2.1
Non-current provisions 0.0
Other non-current liabilities 4.7 4.6 4.6
Non-current liabilities total 10.4 11.0 11.1
Current liabilities
Short-term financial liabilities 8.4 1.0 1.8
Income tax payable 1.0 1.0 1.0
Trade payables and other liabilities 33.1 30.7 39.1
Current liabilities total 42.6 32.7 41.9
Total liabilities 52.9 43.7 53.0
Total equity and liabilities 187.9 178.5 191.9
CONSOLIDATED STATEMENT OF CASH FLOWS
EUR million Q1-Q3 Q1-Q3 Q1-Q4
2011 2010 2010
Net profit for the period 1.2 2.1 6.5
Adjustments, total 5.5 5.2 4.9
Change in net working capital -6.1 -7.3 -7.4
Interests paid -1.6 -0.8 -1.1
Interests received 0.2 0.1 0.3
Taxes paid -2.6 -2.2 -2.6
Net cash flow from operating activities -3.3 -3.1 0.6
Investments in tangible and intangible assets -4.6 -2.6 -3.1
Proceeds from sales of tangible and intangible assets 0.0 0.5 0.5
Acquisition of associated companies -0.1 -8.1 -8.1
Proceeds from sales of associated companies 0.5
Transactions with non-controlling interests 2.7 2.7
Purchases of other investments -18.0 -26.8 -32.9
Proceeds from sales of other investments 25.1 39.8 43.0
Dividends received from investing activities 0.3 1.5 1.5
Net cash flow from investing activities 3.2 6.9 3.5
Proceeds from and repayments of short-term loans 4.9 0.4 0.6
Proceeds from and repayments of long-term loans 0.0 -0.4 -0.3
Dividends paid -5.6 -4.7 -4.7
Cash flows from financing activities -0.6 -4.7 -4.4
Net change in cash and cash equivalents -0.7 -0.8 -0.3
Cash and cash equivalents
at the beginning of the period 7.5 7.9 7.9
Cash and cash equivalents
at the end of the period 6.8 7.0 7.5
Purchases of other investments and proceeds from
sales of other investments are cash flows related
to short-term fixed income funds.
STATEMENT OF CHANGES IN
SHAREHOLDERS' EQUITY
A = Shareholders' equity at 1 January
B = Dividend distribution
C = Transactions with NCI
D = Other changes
E = Total comprehensive income
F = Shareholders' equity at 30 Sept.
January - September 2011
EUR million A B C D E F
Share capital 12.6 12.6
Share premium account 23.4 23.4
Net unrealised gains -0.8 0.7 -0.1
Other reserves 7.2 7.2
Own shares -1.8 -1.8
Translation differences 0.3 -0.2 0.2
Retained earnings 95.3 -5.6 -0.2 -0.2 1.4 90.8
Attributable to equity
holders of the parent 136.2 -5.6 -0.2 -0.2 2.0 132.4
Non-controlling interests (NCI) 2.7 -0.2 2.6
Total equity 138.9 -5.6 -0.2 -0.2 1.8 134.9
January - September 2010
EUR million A B C D E F
Share capital 12.6 12.6
Share premium account 23.4 23.4
Net unrealised gains -0.4 -0.4
Other reserves 7.2 7.2
Own shares -1.8 -1.8
Translation differences -0.5 0.6 0.1
Retained earnings 96.4 -4.7 -2.9 0.0 2.1 90.8
Attributable to equity
holders of the parent 137.3 -4.7 -2.9 0.0 2.2 131.9
Non-controlling interests (NCI) 2.9 2.9
Total equity 137.3 -4.7 0.0 2.2 134.8
BASIS OF PREPARATION AND ACCOUNTING POLICIES
The Interim Report has been prepared in accordance with IAS 34, Interim
Financial Reporting, as adopted by the EU. The accounting policies
adopted are consistent with those of the Group's annual financial statements
for the year ended 31 December 2010. New standards and interpretations
adopted in 2011 did not have any material effect to this Interim Report.
SEGMENT INFORMATION
EUR million
A = Frozen Foods
B = Seafood
C = Grains and Oilseeds
D = Other Operations
E = Total
Operating segments,
January - September 2011
EUR million
A B C D E
Total segment sales 34.2 62.1 158.5 1.4 256.3
Intra-group sales -1.2 -1.2
Net sales 34.2 62.1 158.5 0.2 255.1
Share of profits of associated
companies included in operating
profit 0.4 -0.4 -0.1
Operating profit 1.8 -2.0 6.9 -3.1 3.6
Gross investments in non-current
assets 1.7 0.6 2.2 0.1 4.6
Corporate acquisitions and other
share purchases 0.1 0.1
Depreciations 1.7 1.5 0.5 0.7 4.3
Impairments
Personnel 200 348 60 10 619
Operating segments,
January - September 2010
EUR million
A B C D E
Total segment sales 33.8 57.1 129.7 1.4 222.0
Intra-group sales -1.2 -1.2
Net sales 33.8 57.1 129.7 0.2 220.8
Share of profits of associated
companies included in operating
profit 0.3 0.5 0.8
Operating profit 1.9 -2.2 5.6 -2.0 3.2
Gross investments in non-current
assets 1.1 0.8 0.6 0.1 2.6
Corporate acquisitions and other
share purchases 10.5 10.5
Depreciations 1.6 1.4 0.5 0.5 4.0
Impairments
Personnel 191 354 60 10 615
Operating segments,
January - December 2010
EUR million
A B C D E
Total segment sales 45.1 80.9 181.9 2.6 310.5
Intra-group sales 0.0 0.0 0.0 -1.7 -1.8
Net sales 45.1 80.9 181.9 0.9 308.7
Share of profits of associated
companies included in operating
profit 0.6 2.4 3.0
Operating profit 3.4 -1.8 7.2 -0.5 8.3
Gross investments in non-current
assets 1.2 1.1 0.7 0.2 3.1
Corporate acquisitions and other
share purchases 10.5 10.5
Depreciations 2.2 1.9 0.7 0.6 5.3
Impairments 0.1 0.1
Personnel 199 351 61 10 621
KEY INDICATORS
30 Sept 30 Sept 31 Dec
2011 2010 2010
Shareholders' equity per share, EUR 21.40 21.31 22.01
Equity ratio, % 71.8 75.6 72.4
Gearing, % 2.5 -5.9 -7.7
Gross investments in non-current assets,
EUR million 4.6 2.6 3.1
Corporate acquisitions and other share purchases,
EUR million 0.1 10.5 10.5
Average number of personnel 619 615 621
Average number of shares, 1,000 pcs 6188 6188 6188
The key figures in this interim report are
calculated with same accounting principles
than presented in the 2010 annual financial
statements.
CONTINGENT LIABILITIES, CONTINGENT ASSETS
AND OTHER COMMITMENTS
EUR million 30 Sept 30 Sept 31 Dec
2011 2010 2010
Mortgages given for debts
Real estate and corporate mortgages 2.7 2.8 2.8
Guarantees 11.5 13.7 12.1
Non-cancellable other leases,
minimum lease payments
Real estate leases 4.3 5.0 5.9
Other leases 0.6 0.8 0.7
DERIVATIVE INSTRUMENTS
Outstanding nominal values of derivate instruments
Forward currency contracts 15.0 8.0 6.6
Commodity derivative instruments 8.5 17.2 13.9
CONTINGENT ASSETS
The present value of proceeds from the sale of
shares in the joint entry account 0.7 0.7 0.7
INVESTMENT COMMITMENTS
Frozen Foods 0.1
Grains and Oilseeds 0.4
OTHER COMMITMENTS
Based on the shareholder agreements on the ownership arrangement between
Apetit Kala Oy and Taimen Oy, once certain terms and conditions are met the
contracting parties are entitled to terminate the cross ownership at fair value.
The liability in any termination of ownership is, on the basis of IAS 32 recognised
under non-current liabilities. The receivable arising in connection with this may
not, under IFRS rules, be recognised.
CHANGES IN TANGIBLE ASSETS
EUR million 30 Sept 30 June 31 Dec
2011 2010 2010
Book value at the beginning of the period 37.0 37.9 37.9
Additions 4.4 2.1 2.6
Additions through acquisitions 0.7 0.7
Disposals -0.3 -0.2 -0.3
Depreciations and impairments -3.5 -3.3 -4.4
Other changes 0.4 0.5
Book value at the end of the period 37.6 37.7 37.0
TRANSACTIONS WITH ASSOCIATED
COMPANIES AND JOINT VENTURES
EUR million Q1-Q3 Q1-Q3 Q1-Q4
2011 2010 2010
Sales to associated companies 0.3 0.3 1.1
Sales to joint ventures 6.2 5.5 7.3
Purchases from associated companies 9.0 1.6 6.6
Long-term receivables from joint ventures 0.0 0.1 0.1
Trade receivables and other receivables from
associated companies 0.0 1.5 1.6
Trade receivables and other receivables from
joint ventures 1.3 1.1 0.7
Trade payables and other liabilities to associated
companies 0.8 0.4
LÄNNEN TEHTAAT PLC
Board of Directors
Further information: Matti Karppinen, CEO, tel. +358 10 402 00
COPIES TO:
NASDAQ OMX Helsinki Ltd
Main media
www.lannen.fi
Lännen Tehtaat plc and Nordic Sugar Oy are both owners of Sucros Ltd, a company engaged in the processing and marketing of sugar in Finland. Lännen Tehtaat plc has a 20% holding in Sucros Ltd and Nordic Sugar Oy is the majority owner with 80% of the shares.
Lännen Tehtaat plc STOCK EXCHANGE RELEASE 14 October 2011 at 9.30 a.m.
Sucros Ltd was established in 1990 when the sugar industries of Lännen Tehtaat plc and the then Cultor Oy were combined under joint ownership. The shareholder agreement that was drawn up when Sucros Ltd was established includes special minority owner protection for Lännen Tehtaat plc as the minority owner.
Lännen Tehtaat and Nordic Sugar are now in a situation in the operations of Sucros Ltd in which Lännen Tehtaat is of the opinion that its minority rights have repeatedly been violated by the decision-making and actions of the majority owner. In spite of several complaints, the majority owner has not rectified the actions that are in breach of the shareholder agreement, and therefore Lännen Tehtaat has decided to take the issue to arbitration to be resolved. In its rejoinder to Lännen Tehtaat, Nordic Sugar has denied the breaches of shareholder agreement.
According to Lännen Tehtaat, Nordic Sugar has committed 3 breaches against the agreement. According to the terms and conditions of the shareholder agreement, one proven breach will incur a contractual penalty totalling EUR 8.9 million per breach. Therefore the penalty could total a maximum of close to EUR 27 million.
LÄNNEN TEHTAAT PLC
Matti Karppinen
CEO
Further information: Matti Karppinen, CEO, tel. +358 10 402 00
Copies to:
NASDAQ OMX Helsinki Ltd
Main media
www.lannen.fi
Lännen Tehtaat Group's business sectors are the Frozen Foods business, the Seafood business, the Grains and Oilseeds business and Other Operations.
The Group's net sales in 2010 totalled EUR 308.7 million, operating profit was EUR 8.3 million and profit for the financial year was EUR 6.5 million. The Group employed an average of 621 people.
Sucros Ltd is engaged in producing and marketing sugar for industry and the retail trade. At its sugar mill in Säkylä, Sucros Ltd processes sugar from Finnish sugar beet amounting to just under half of the annual sugar consumption in Finland. Sucros Ltd also refines raw sugar at its sugar refinery in Kirkkonummi. The Sucros Group's net sales are about EUR 155 million and it employs approximately 260 people.
LÄNNEN TEHTAAT PLC Interim Report 11 August 2011, 8.30 am
April-June:
- Consolidated net sales amounted to EUR 93.5 (80.0) million, up by 17%
- Operating profit, excluding non-recurring items, was EUR 2.1 (1.0) million
- EUR 1.7 million in non-recurring expenses related to cost-efficiency improvement measures in the Seafood business were recognised for the second quarter
- Net sales in the Grains and Oilseeds business and in the Seafood business grew substantially
- The second-quarter profit for the Grains and Oilseeds business was excellent
January-June:
- Consolidated net sales amounted to EUR 177.5 (154.9) million, up by 15%
- Operating profit, excluding non-recurring items, was EUR 3.0 (1.9) million; non-recurring items totalled EUR -1.7 (0.0) million
The assessment of profit performance for the full year is unchanged.
The information in this Interim Report has not been audited.
Matti Karppinen, CEO:
“The Group's business and profitability improved as forecast. Due to the best quarterly result in the history of the Grains and Oilseeds business and the improved performance of the Seafood business, the second-quarter operating profit, excluding non-recurring items, was better than the same quarter a year ago and better than the first quarter of this year, as had been expected. Consolidated net sales were up 17% year on year. Net sales increased substantially not only in the Grains and Oilseeds business, but also in the Seafood business.
As a result of the decisions made in April to improve the efficiency of the Seafood business in Finland and Norway, non-recurring expenses of EUR 1.7 million were recognised in the second-quarter profit. The efficiency improvement measures aim at an annual profit increase of approximately EUR 1.4 million starting from the third quarter.
By improving our efficiency and concentrating our operations, and by strengthening our position in the fresh fish trade in Finland and carrying out essential price rises, we believe we will make our Seafood business profitable.”
KEY FIGURES
EUR million Q2 Q2 Q1-Q2 Q1-Q2 Q1-Q4
2011 2010 2011 2010 2010
Net sales 93.5 80.0 177.5 154.9 308.7
Operating profit, excluding non-recurring items 2.1 1.0 3.0 1.9 8.3
Operating profit 0.4 1.0 1.3 1.9 8.3
Profit before taxes -0.1 0.9 0.4 2.1 8.4
Profit for the period -0.2 0.6 0.0 1.4 6.5
Earnings per share, EUR -0.02 0.10 0.03 0.24 1.04
NET SALES AND PROFIT
April-June:
Consolidated net sales in the second quarter amounted to EUR 93.5 (80.0) million, an increase of 17% on the same quarter in 2010. This was a result of net sales increases in both the Grains and Oilseeds business and the Seafood business.
The Group´s operating profit, excluding non-recurring items, was EUR 2.1 (1.0) million. Non-recurring items totalled EUR -1.7 (0.0) million. The operating profit includes EUR 0.3 (0.3) million as the share of the profits of associated companies. The profit, excluding non-recurring items, for both the Seafood business and the Grains and Oilseeds business was up on the second-quarter figures of a year earlier. The corresponding figures for the Frozen Foods business and Other Operations segment were slightly down year on year.
January-June:
Consolidated net sales in January-June amounted to EUR 177.5 (154.9) million, up by 15%.
The operating profit, excluding non-recurring items, was EUR 3.0 (1.9) million. The operating profit includes EUR 0.1 (0.2) million as the share of the profits of associated companies. Non-recurring items totalled EUR -1.7 (0.0) million. The non-recurring items for the review period were related to the Seafood business.
Net financial income and expenses were EUR -0.9 (0.1) million. This figure includes valuation items of EUR -0.1 (0.7) million with no cash flow implications. Financial expenses also include EUR -0.6 (-0.5) million as the share of the Avena Nordic Grain Group's profit attributable to the employee owners of Avena Nordic Grain Oy. Due to changes in ownership during the review period, the employee owners' holding in Avena Nordic Grain Oy rose from 14.6% to 17.1%.
Profit before taxes was EUR 0.4 (2.1) million. The profit for the period was EUR 0.0 (1.4) million, and earnings per share amounted to EUR 0.03 (0.24).
FINANCING AND BALANCE SHEET
The Group's liquidity was good and its financial position is strong.
The cash flow from operating activities after interest and taxes amounted to EUR 15.5 (8.6) million in January-June. The impact of the change in working capital was EUR 14.2 (5.6) million. Working capital was released mainly from the Grains and Oilseeds business.
The net cash flow from investing activities was EUR -7.9 (-7.3) million. Deposits and withdrawals of cash assets invested in short-term fixed income funds had an impact of EUR -6.0 (-1.0) million. The cash flow from financing activities was EUR -8.1 (-5.3) million, including EUR -2.6 (-0.5) million in loan withdrawals and repayments and EUR -5.6 (-4.7) million in dividend payments. The net change in cash and cash equivalents was EUR -0.6 (-4.0) million.
At the end of the period, the Group had EUR 2.8 (2.7) million in interest-bearing liabilities and EUR 20.1 (22.2) million in liquid assets. Net interest-bearing liabilities totalled EUR -17.3 (-19.4) million. The consolidated balance sheet total stood at EUR 172.1 (169.9) million. At the end of the review period, equity totalled EUR 134.2 (134.0) million. The equity ratio was 78.0% (78.9%). The Group's liquidity is secured with committed credit facilities allowing withdrawals of up to EUR 25 (25) million. The credit and commercial papers raised during the period to finance working capital had been repaid by the end of the period.
INVESTMENT
Investment in non-current assets during the review period was EUR 2.7 (1.7) million.
PERSONNEL
The average number of personnel in the review period was 607 (603).
Second-quarter net sales in the Frozen Foods business were slightly up on the figure for the same quarter of 2010. Sales were up in all distribution channels with the exception of retail sector sales, which were slightly lower than in the comparison period. Owing to new products, the best sales performance was in frozen ready meals and frozen vegetables and berries to the hotel, restaurant and catering sector.
The second-quarter operating profit was down year on year due to the product mix in sales and a significant rise in the raw material and energy prices, which had only been partly compensated by price rises carried out early in the year. Due to increased costs, there are still pressures for price increases. Second-quarter overhead costs were increased by marketing inputs in the Apetit Finnishness campaign.
Net sales in January-June were on a par with the same period in 2010. Sales of frozen vegetables and berries were up year on year. Due to decreased sales of frozen potato products and frozen pizza, retail trade product sales were down on the previous year's figure. Strong growth continued in the hotel, restaurant and catering sector.
The operating profit for January-June was slightly below the figure of a year earlier.
Due to the favourable weather conditions of the growing season, the harvest outlooks of Finnish contract farms look good at the moment. The first spinach crop harvested at the end of June was excellent. Pea threshing and processing is in progress, and the targeted quantity of good-quality peas will be deep-frozen. The potato and root crop growing season is continuing in Finland.
The exceptionally warm and dry weather of the spring and early summer caused losses in several vegetable crops in parts of Europe. Due to high demand, the market prices of, for instance, sweet peppers and maize have risen significantly. In Europe, the coming root crop is forecast to correspond to demand.
The average number of personnel in Frozen Foods during January-June was 193 (181).
Investment totalled EUR 1.3 (0.6) million during the period. The most significant items were replacement investments in frozen vegetable production and energy efficiency improvements.
The second-quarter net sales of the Seafood business were up by 21% on the figure for the same quarter in 2010. Net sales were up in the Finnish, Norwegian and Swedish Seafood businesses.
The approximate 35% increase in the net sales of the Finnish Seafood business was a result of increased volumes, price increases and the integration of Myrskylän Savustamo into the Group at the start of June 2010. Unlike the previous year, Easter sales occurred in the second quarter. Net sales were reduced by the lower number of Kalatori service counters compared with the previous year.
In the Norwegian and Swedish Seafood businesses, net sales were up slightly both in euro terms and measured in local currencies. The removal of the unprofitable smoked fish product segment was compensated by 8-12% growth in other product groups. Sales of dressings grew by over 30%, an exception among the product groups.
Due to the improved performance of the Finnish Seafood business, the Seafood business's second-quarter operating result, excluding non-recurring items, was up by EUR 0.9 million year on year. However, the Seafood business's result, excluding non-recurring items, was a loss of EUR -0.2 million.
The Finnish Seafood business's second-quarter operating profit, excluding non-recurring items, improved year on year as a result of an increased gross margin and decreased overhead costs. The Taimen Group's effect on the quarterly result was minor. The Finnish Seafood business's profit performance was adversely affected by the poor availability and high price of rainbow trout raw materials at the start of the period, and the price of Norwegian salmon, which fluctuated substantially during the spring and summer. The bankruptcy of a company that provided logistics services led to a temporary deterioration in delivery reliability in May-June. Delivery performance returned to normal at the end of the review period.
The Norwegian and Swedish Seafood's second-quarter operating profit, excluding non-recurring items, was at the level of the same quarter in 2010. A decrease in overhead costs compensated for the weakening in gross margin that resulted from higher raw material and packaging material prices than the year before. For the time being, increased costs have been only partially offset by increased sales prices. Product redesigns and measures to improve profitability and cost-effectiveness are continuing in the Norwegian and Swedish units.
The second-quarter non-recurring items totalled EUR -1.7 (0.0) million. A cost-efficiency programme was implemented at Apetit Kala Oy to cut overheads. Maritim Food AS decided to concentrate Norwegian production at one plant in Fredrikstad. These measures aim at achieving annual savings of about EUR 1.4 million, starting from the third quarter. The Seafood business's efficiency improvement measures are described in greater detail in the stock exchange releases dated 6 April 2011 and 15 April 2011 and in the Interim Report published on 5 May 2011.
Seafood's net sales for January-June were up by 11% on the same period in 2010. Net sales of the Finnish Seafood business were up by 20%. Net sales of Seafood's Norwegian and Swedish operations in euros were at about the level of a year earlier. Measured in local currencies, net sales were down due to the removal of smoked fish products from the product selection. Due to product redesigns, good performance continued in the other product groups.
Seafood's January-June operating result, excluding non-recurring items, was up on the previous year's level, but loss-making. The Finnish Seafood business improved its result, year on year. The share of the profit of associated companies was EUR 0.1 (-0.1) million. The January-June operating profit of the Norwegian and Swedish Seafood businesses, excluding non-recurring items, was lower than in the previous year due to the poor first quarter.
The number of personnel in the Seafood business averaged 346 (352).
Investment in the Seafood business totalled EUR 0.4 (0.6) million. The main items during the period were replacement investments at different production plants in Finland, Norway and Sweden.
Second-quarter net sales in the Grains and Oilseeds business were up by 19% year on year. This growth was attributable to large deliveries and higher market prices than the year before. The majority of the net sales originated from exports and trading outside Finland.
The second-quarter operating profit of the Grains and Oilseeds business was better than a year before and the best of all time. The good result was attributable to the large deliveries and the realisation of synergy benefits from combining the Grains and Vegetable Oil businesses.
The net sales in January-June were up by 20% year on year due to increased market prices. Operating profit was EUR 1.2 million better than a year earlier.
During the review period, Avena Nordic Grain Oy decided to expand its area of supply by establishing a subsidiary in Ukraine. The aim is to increase Avena's trading opportunities by expanding the acquisition of grains and oilseeds from the Ukrainian market. Avena already has subsidiaries in Estonia, Lithuania, Russia and Kazakhstan.
In the early summer, the prices of grains and oilseeds decreased substantially compared with the spring. The reason for this is more favourable weather conditions as the growing season progressed, and especially the activation of the Black Sea export market after Russia removed the export ban that had been in force during the last crop year, and after Ukraine had replaced export quotas with export duties. The EU's grain crop is anticipated to be at last year's level, but the oilseed crop is expected to decline by 1.5 million tonnes from last year, and to remain at 26.5 million tonnes. In Finland, the growing season has, on average, been favourable, and grains' crop outlooks are generally good. The oilseeds crop is estimated to decline in Finland by 30% from the record-breaking previous year. Hardly any surplus grains and oilseeds are on sale anymore. The new crop is expected to bring plenty of trading opportunities as available production quantities and qualities vary in the different market areas.
The Grains and Oilseeds business employed an average of 58 (60) people in the first six months of the year.
Investment totalled EUR 1.0 (0.4) million in January-June and focused on the packaging plant being constructed at the Kirkkonummi vegetable oil mill.
The Other Operations segment comprises the service company Apetit Suomi Oy, Group Administration, items not allocated under any of the business segments, and the associated companies Sucros Ltd and Ateriamestarit Oy. The cost of services produced by Apetit Suomi Oy is an encumbrance on the operating profit of the Group's businesses in proportion to their use of the services.
Net sales from the sale of services were at the previous year's level.
The EUR -0.5 (-0.4) million operating profit for April-June includes EUR 0.3 (0.4) million as the share of the profits of associated companies.
The EUR -2.0 (-1.6) million operating profit for January-June includes EUR 0.1 (0.3) million as the share of the profits of associated companies.
The segment's investment totalled EUR 0.0 (0.1) million.
DECISIONS OF THE ANNUAL GENERAL MEETING
Dividend distribution
The Annual General Meeting of Lännen Tehtaat plc held on 31 March 2011 resolved that a dividend of EUR 0.90 per share be distributed from the profits of the financial year 2010, in accordance with the proposal of the Board of Directors. EUR 5.6 million was paid out in dividends on 12 April 2011.
More detailed information on the decisions of the Annual General Meeting and the share issue authorisations granted to the Board of Directors are given in the stock exchange release dated 31 March 2011 and in the Interim Report published on 5 May 2011.
USE OF THE AUTHORISATIONS GRANTED TO THE BOARD OF DIRECTORS
Authorisations to issue shares
The company's Board of Directors has not exercised the authorisation granted to it by the Annual General Meeting on 31 March 2011 to issue new shares or to transfer Lännen Tehtaat plc shares held by the company.
SHARES AND TRADING
The number of Lännen Tehtaat plc shares traded on the stock exchange during January-June was 348,359 (498,118), representing 5.5% (7.9%) of the total number of shares. The euro-denominated share turnover was EUR 5.9 (8.6) million. The highest share price quoted was EUR 18.80 (20.00) and the lowest EUR 14.75 (15.51). The average price of shares traded was EUR 16.90 (17.25).
At the end of June, the market capitalisation totalled EUR 95.3 (104.9) million.
At the end of June, the company held 130,000 of its own shares, with a combined nominal value of EUR 0.26 million. These treasury shares represent 2.1% of the company's total number of shares and of the total number of votes.
FLAGGING ANNOUNCEMENTS
No flagging announcements were made during January-June.
CORPORATE ADMINISTRATION AND AUDITORS
At its organisational meeting on 14 April 2011, Lännen Tehtaat plc's Supervisory Board elected Timo Miettinen as Chairman of the Supervisory Board and Marja-Liisa Mikola-Luoto as Deputy Chairman.
The Supervisory Board elected the following as members of the company's Board of Directors: Heikki Halkilahti, Aappo Kontu, Matti Lappalainen, Hannu Simula, Jorma J. Takanen and Helena Walldén. Matti Lappalainen was elected as Chairman of the Board of Directors and Hannu Simula was elected as Deputy Chairman.
Hannu Pellinen, APA, and PricewaterhouseCoopers Oy Authorized Public Accountants, with Tomi Moisio, APA, CPFA as responsible auditor, were appointed as auditors for Lännen Tehtaat plc by the Annual General Meeting on 31 March 2011.
SEASONALITY OF OPERATIONS
In accordance with the IAS 2 standard, the historical cost of inventories includes a systematically allocated portion of the fixed production overheads. In production that focuses on seasonal crops, raw materials are processed into finished products mainly during the final quarter of the year, which means that the inventory volumes and their balance-sheet values are at their highest at the end of the year. Since the entry of the fixed production overheads included in the historical cost as an expense item is deferred until the time of sale, most of the Group's annual profit is accrued in the final quarter. The seasonal nature of operations is most marked in Frozen Foods and in the associated company Sucros, due to the link between production and the crop harvesting season.
In the Seafood business, the sales of Apetit Kala Oy and Myrskylän Savustamo Oy peak at weekends and on holidays. A significant proportion of the entire year's profit in the Seafood business depends on the success of the Christmas season. Due to the growing season for fish, only a small amount of the profit accumulated for the Taimen Group, which reports as an associated company, normally accrues during the summer months. As Easter can take place in either the first or the second quarter, this can affect the comparability of net sales and profit in the Frozen Foods and Seafood businesses between different years. Net sales in the Grains and Oilseeds business vary from one year and quarter to the next to a greater extent than in the other businesses, being dependent on the demand and supply situation and on the price levels domestically and on other markets.
SHORT-TERM RISKS AND UNCERTAINTIES
The most significant short-term risks for the Lännen Tehtaat Group concern the following: the management of raw material price changes and currency risks; availability of raw materials; the impact of the rise in energy prices; the price competition of the seafood market; the change in the production plant structure of the Norwegian company; the solvency of customers and the delivery performance of suppliers and service providers; changes in the Group's business sectors and customer relationships; and corporate acquisitions and the subsequent integration processes.
SIGNIFICANT EVENTS SINCE THE END OF THE REVIEW PERIOD
There have been no significant events since the end of the review period.
ASSESSMENT OF PROBABLE FUTURE DEVELOPMENT
The Group's net sales will be affected particularly by the level of activity in the grain and oilseed markets and by changes in the price level of grains and oilseeds.
Thanks to the measures taken to develop the Group's different businesses, and thanks to the corporate acquisitions made in 2010, the full-year operating profit, excluding non-recurring items, is expected to be better than the previous year's level. Profit accrual is expected to be weighted heavily towards the last quarter of the year, as in 2010.
The profit for the financial year will be depressed by non-recurring costs associated with the Seafood business's efficiency improvement measures reported in the second quarter. There were no non-recurring costs in 2010.
CONSOLIDATED INCOME STATEMENT
EUR million Q2 Q2 Q1-Q2 Q1-Q2 Q1-Q4
2011 2011 2011 2010 2010
Net sales 93.5 80.0 177.5 154.9 308.7
Other operating income 0.2 0.2 0.4 0.6 1.4
Operating expenses -92.2 -78.2 -173.9 -151.0 -299.4
Depreciation -1.4 -1.3 -2.9 -2.6 -5.3
Impairments 0.0 0.0 0.0 0.0 -0.1
Share of profits of associated companies 0.3 0.3 0.1 0.2 3.0
Operating profit 0.4 1.0 1.3 1.9 8.3
Financial income and expenses -0.5 -0.2 -0.9 0.1 0.1
Profit before taxes -0.1 0.9 0.4 2.1 8.4
Income taxes -0.1 -0.3 -0.4 -0.7 -1.9
Profit for the period -0.2 0.6 0.0 1.4 6.5
Attributable to
Equity holders of the parent -0.1 0.6 0.2 1.5 6.5
Non-controlling interests -0.1 -0.1 -0.2 -0.1
Basic and diluted earnings per share,
calculated of the profit attributable to the
shareholders of the parent company, EUR -0.02 0.10 0.03 0.24 1.04
STATEMENT OF COMPREHENSIVE
INCOME
EUR million Q2 Q2 Q1-Q2 Q1-Q2 Q1-Q4
2011 2010 2011 2010 2010
Profit for the period -0.2 0.6 0.0 1.4 6.5
Other comprehensive income
Cash flow hedges 0.4 -0.4 1.4 -0.7 1.1
Taxes related to cash flow hedges -0.1 0.1 -0.4 0.2 -0.3
Translation differences 0.0 0.0 0.0 0.5 0.8
Total comprehensive income 0.1 0.3 1.0 1.4 8.1
Attributable to
Equity holders of the parent 0.2 0.4 1.2 1.4 8.1
Non-controlling interests -0.1 -0.1 -0.2 -0.1
CONSOLIDATED STATEMENT OF FINANCIAL
POSITION
EUR million 30 June 30 June 31 Dec
2011 2010 2010
ASSETS
Non-current assets
Intangible assets 5.7 6.3 6.0
Goodwill 8.7 8.5 8.6
Tangible assets 37.1 38.0 37.0
Investment in associated companies 33.7 32.3 33.9
Available-for-sale investments 0.1 0.1 0.1
Receivables 0.5 0.5 0.7
Deferred tax assets 1.6 1.2 1.4
Non-current assets total 87.2 87.0 87.5
Current assets
Inventories 39.2 30.7 55.0
Receivables 25.6 30.1 34.5
Income tax receivable 0.1 0.0 0.2
Financial assets at fair value through profits 13.1 18.3 7.1
Cash and cash equivalents 7.0 3.9 7.5
Current assets total 84.9 83.0 104.4
Total assets 172.1 169.9 191.9
EUR million 30 June 30 June 31 Dec
2011 2010 2010
EQUITY AND LIABILITIES
Equity attributable to the equity holders of the parent 131.7 131.5 136.2
Non-controlling interests 2.5 2.6 2.7
Total equity 134.2 134.0 138.9
Non-current liabilities
Deferred tax liabilities 3.7 3.7 4.4
Long-term financial liabilities 2.0 2.6 2.1
Non-current provisions 0.0 0.2 0.0
Other non-current liabilities 4.6 4.5 4.6
Non-current liabilities total 10.3 11.0 11.1
Current liabilities
Short-term financial liabilities 0.8 0.2 1.8
Income tax payable 1.0 2.4 1.0
Trade payables and other liabilities 25.8 22.3 39.1
Current liabilities total 27.6 24.9 41.9
Total liabilities 37.9 35.9 53.0
Total equity and liabilities 172.1 169.9 191.9
CONSOLIDATED STATEMENT OF CASH FLOWS
EUR million Q1-Q2 Q1-Q2 Q1-Q4
2011 2010 2010
Net profit for the period 0.0 1.4 6.5
Adjustments, total 4.2 2.8 4.9
Change in net working capital 14.2 5.6 -7.4
Interests paid -1.4 -0.8 -1.1
Interests received 0.1 0.1 0.3
Taxes paid -1.5 -0.5 -2.6
Net cash flow from operating activities 15.5 8.6 0.6
Investments in tangible and intangible assets -2.7 -1.7 -3.1
Proceeds from sales of tangible and intangible assets 0.0 0.5 0.5
Acquisition of associated companies -0.1 -8.0 -8.1
Proceeds from sales of associated companies 0.5
Transactions with non-controlling interests 2.7 2.7
Purchases of other investments -13.0 -1.0 -32.9
Proceeds from sales of other investments 7.0 0.0 43.0
Dividends received from investing activities 0.3 0.2 1.5
Net cash flow from investing activities -7.9 -7.3 3.5
Proceeds from and repayments of short-term loans -2.6 -0.2 0.6
Proceeds from and repayments of long-term loans 0.0 -0.3 -0.3
Dividends paid -5.6 -4.7 -4.7
Cash flows from financing activities -8.1 -5.3 -4.4
Net change in cash and cash equivalents -0.6 -4.0 -0.3
Cash and cash equivalents at the beginning of the period 7.5 7.9 7.9
Cash and cash equivalents at the end of the period 7.0 3.9 7.5
Purchases of other investments and proceeds from
sales of other investments are cash flows related
to short-term fixed income funds.
STATEMENT OF CHANGES IN
SHAREHOLDERS' EQUITY
A = Shareholders' equity at 1 January
B = Dividend distribution
C = Transactions with NCI
D = Other changes
E = Total comprehensive income
F = Shareholders' equity at 30 June
January - June 2011
EUR million A B C D E F
Share capital 12.6 12.6
Share premium account 23.4 23.4
Net unrealised gains -0.8 1.0 0.2
Other reserves 7.2 7.2
Own shares -1.8 -1.8
Translation differences 0.3 0.0 0.3
Retained earnings 95.3 -5.6 -0.2 0.0 0.2 89.6
Attributable to equity holders of the parent 136.2 -5.6 -0.2 0.0 1.2 131.7
Non-controlling interests (NCI) 2.7 -0.2 2.5
Total equity 138.9 -5.6 -0.2 0.0 1.0 134.2
January - June 2010
EUR million A B C D E F
Share capital 12.6 12.6
Share premium account 23.4 23.4
Net unrealised gains 0.0 -0.5 -0.5
Other reserves 7.2 0.0 7.2
Own shares -1.8 -1.8
Translation differences -0.5 0.5 0.0
Retained earnings 96.4 -4.7 -2.3 -0.2 1.5 90.6
Attributable to equity holders of the parent 137.3 -4.7 -2.3 -0.2 1.4 131.5
Non-controlling interests (NCI) 2.6 -0.1 2.6
Total equity 137.3 -4.7 0.3 -0.2 1.4 134.0
BASIS OF PREPARATION AND ACCOUNTING POLICIES
The Interim Report has been prepared in accordance with IAS 34, Interim Financial
Reporting, as adopted by the EU. The accounting policies adopted are consistent
with those of the Group's annual financial statements for the year ended
31 December 2010. New standards and interpretations adopted in 2011 did not have
any material effect to this Interim Report.
SEGMENT INFORMATION
EUR million
A = Frozen Foods
B = Seafood
C = Grains and Oilseeds
D = Other Operations
E = Total
January - June 2011
EUR million
A B C D E
Total segment sales 23.8 41.6 111.9 0.9 178.2
Intra-group sales 0.0 0.0 0.0 -0.7 -0.7
Net sales 23.8 41.6 111.9 0.2 177.5
Share of profits of associated
companies included in operating
profit 0.1 0.1 0.1
Operating profit 0.3 -2.4 5.3 -2.0 1.3
Gross investments in non-current
assets 1.3 0.4 1.0 0.0 2.7
Corporate acquisitions and other
share purchases 0.1 0.1
Depreciations 1.1 1.0 0.4 0.5 2.9
Impairments 0.0 0.0
Personnel 193 346 58 11 607
Operating segments,
January - June 2010
EUR million
A B C D E
Total segment sales 23.8 37.4 93.5 0.9 155.6
Intra-group sales 0.0 0.0 0.0 -0.7 -0.7
Net sales 23.8 37.4 93.5 0.2 154.9
Share of profits of associated
companies included in operating
profit -0.1 0.3 0.2
Operating profit 0.6 -1.1 4.1 -1.6 1.9
Gross investments in non-current
assets 0.6 0.6 0.4 0.1 1.7
Corporate acquisitions and other
share purchases 10.5 10.5
Depreciations 1.1 0.9 0.3 0.3 2.6
Impairments 0.0 0.0
Personnel 181 352 60 10 603
Operating segments,
January - December 2010
EUR million
A B C D E
Total segment sales 45.1 80.9 181.9 2.6 310.5
Intra-group sales 0.0 0.0 0.0 -1.7 -1.8
Net sales 45.1 80.9 181.9 0.9 308.7
Share of profits of associated
companies included in operating
profit 0.6 2.4 3.0
Operating profit 3.4 -1.8 7.2 -0.5 8.3
Gross investments in non-current
assets 1.2 1.1 0.7 0.2 3.1
Corporate acquisitions and other
share purchases 10.5 10.5
Depreciations 2.2 1.9 0.7 0.6 5.3
Impairments 0.1 0.1
Personnel 199 351 61 10 621
KEY INDICATORS
30 June 30 June 31 Dec
2011 2010 2010
Shareholders' equity per share, EUR 21.3 21.3 22.0
Equity ratio. % 78.0 78.9 72.4
Gearing, % -12.9 -14.5 -7.7
Gross investments in non-current assets, EUR million 2.7 1.7 3.1
Corporate acquisitions and other share purchases,
EUR million 0.1 10.5 10.5
Average number of personnel 607 603 621
Average number of shares, 1,000 pcs 6,188 6,188 6,188
The key figures in this interim report are
calculated with same accounting principles than
presented in the 2010 annual financial statements.
CONTINGENT LIABILITIES, CONTINGENT ASSETS
AND OTHER COMMITMENTS
EUR million 30 June 30 June 31 Dec
2011 2010 2010
Mortgages given for debts
Real estate mortgages 2.7 2.8 2.8
Guarantees 11.4 11.0 12.1
Non-cancellable other leases, minimum lease payments
Real estate leases 4.4 5.3 5.9
Other leases 0.6 0.8 0.7
DERIVATIVE INSTRUMENTS
Outstanding nominal values of derivate instruments
Forward currency contracts 8.4 3.3 6.6
Commodity derivative instruments 7.0 9.4 13.9
CONTINGENT ASSETS
The present value of proceeds from the sale of
shares in the joint entry account 0.7 0.7 0.7
INVESTMENT COMMITMENTS
Frozen Foods 0.4
Grains and Oilseeds 1.3
OTHER COMMITMENTS
Based on the shareholder agreements on the ownership
arrangement between Apetit Kala Oy and Taimen Oy,
once certain terms and conditions are met the contracting
parties are entitled to terminate the cross ownership
at fair value.
The liability in any termination of ownership is, on the
basis of IAS 32, recognised under non-current liabilities.
The receivable arising in connection with this may not,
under IFRS rules, be recognised.
CHANGES IN TANGIBLE ASSETS
EUR million 30 June 30 June 31 Dec
2011 2010 2010
Book value at the beginning of the period 37.0 37.9 37.9
Additions 2.4 1.4 2.6
Additions through acquisitions 0.7 0.7
Disposals 0.0 -0.2 -0.3
Depreciations and impairments -2.3 -2.2 -4.4
Other changes 0.0 0.4 0.5
Book value at the end of the period 37.1 38.0 37.0
TRANSACTIONS WITH ASSOCIATED COMPANIES
AND JOINT VENTURES
EUR million Q1-Q2 Q1-Q2 Q1-Q4
2011 2010 2010
Sales to associated companies 0.2 0.2 1.1
Sales to joint ventures 4.0 3.7 7.3
Purchases from associated companies 5.5 1.6 6.6
Long-term receivables from joint ventures 0.1 0.1
Trade receivables and other receivables from
associated companies 0.7 1.4 1.6
Trade receivables and other receivables from
joint ventures 0.5 0.8 0.7
Trade payables and other liabilities to associated
companies 0.0 0.1 0.4
LÄNNEN TEHTAAT PLC
Board of Directors
Further information: CEO Matti Karppinen, tel. +358 40 8448 692
COPIES TO:
NASDAQ OMX Helsinki Ltd
Main media
www.lannen.fi
- Consolidated net sales came to EUR 84.0 (74.8) million, up by 12%.
- Operating profit was EUR 0.8 (0.9) million; there were no non-recurring items.
- Assessment of profit performance for the full year is unchanged.
LÄNNEN TEHTAAT PLC Interim Report 5 May 2011, 8.30 am
The information in this Interim Report has not been audited.
Matti Karppinen, CEO:
“The Group's profit performance remained good in the first quarter of the year, and its operating profit, excluding non-recurring items, was at the previous year's level. Consolidated net sales were up 12% thanks to growth in the Grains and Oilseeds business and the Seafood business.
In the first quarter our focus was especially on laying the groundwork for measures to improve the performance of the Seafood business. Because of a persistently unsatisfactory performance trend, a decision was made to take action in both Finland and Norway targeting an overall cost saving of of EUR 1.4 million. Restructuring the Seafood business and turning around the business that has been loss-making for an extended period is in fact our primary short-term objective.”
Net sales 84.0 74.8 308.7
Operating profit, excluding non-recurring items 0.8 0.9 8.3
Profit before taxes 0.5 1.2 8.4
Profit for the period 0.2 0.8 6.5
Earnings per share, EUR 0.04 0.13 1.04
NET SALES AND PROFIT
Consolidated net sales in January-March amounted to EUR 84.0 (74.8) million, up by about 12% year on year. Most of this growth was in the Grains and Oilseeds business.
Operating profit was EUR 0.8 (0.9) million. There were no non-recurring items in the first quarter, nor were there any in the same period the previous year. The operating profit includes EUR -0.2 (-0.1) million as the share of the profits of associated companies.
Financial income and expenses came to a total of EUR -0.4 (0.3) million. This figure includes valuation items of EUR 0.0 (0.5) million with no cash flow implications. Financial expenses also include EUR -0.3 (-0.2) million of Avena Nordic Grain Group's profit as the share attributable to the Avena Nordic Grain Oy employee shareholders.
Profit before taxes was EUR 0.5 (1.2) million. Profit for the period came to EUR 0.2 (0.8) million, and earnings per share amounted to EUR 0.04 (0.13).
FINANCING AND BALANCE SHEET
The Group's liquidity remained good and its financial position is strong.
The first-quarter cash flow from operating activities after interest and taxes amounted to EUR -19.8 (-15.3) million. The impact of the change in working capital was EUR -21.2 (-15.3) million. In the first quarter, working capital was tied up to a greater extent than a year earlier in the Grains and Oilseeds business, where stocks were high due to new business opportunities and because the grain export shipping programme is weighted towards the second quarter. The amount of working capital was also higher because of the higher market prices for grains and oilseeds than the previous year.
The net cash flow from investing activities came to EUR 6.4 (11.9) million. Deposits and withdrawals of liquid assets into and from short-term fixed income funds had an impact of EUR 7.0 (12.0) million on the net cash flow from investing activities. The cash flow from financing activities came to EUR 15.0 (-0.5) million, and this included EUR 15.0 (-0.2) million in short-term loan withdrawals and repayments. The net change in cash and cash equivalents was EUR 1.6 (-4.0) million.
At the end of the period the Group had EUR 18.9 (2.5) million in interest-bearing liabilities and EUR 9.3 (9.2) million in liquid assets. Net interest-bearing liabilities totalled EUR 9.7 (-6.7) million. The consolidated balance sheet total stood at EUR 197.7 (173.2) million and shareholders' equity amounted to EUR 134.4 (133.4) million. The equity ratio was 68.0% (77.0%) and gearing was 7.2% (-5.0%). Commercial papers issued for the Group's short-term financing stood at a total value of EUR 4.0 (0.0) million at the end of the period. The Group's liquidity is secured with committed credit facilities; a total of EUR 15 (25) million was available in credit at the end of the first quarter. A total of EUR 10.0 (0.0) million of credit was in use.
INVESTMENT
Investment in non-current assets during January-March totalled EUR 0.6 (0.4) million.
PERSONNEL
The average number of personnel during January-March was 601 (596). The number of personnel grew in the Frozen Food business and decreased in the Seafood business.
First-quarter net sales in Frozen Foods were at the level of a year earlier. Unlike the year before, deliveries for Easter sales occurred partly in the second quarter, affecting comparability with the previous year.
Owing to the positive trend in frozen vegetables sales under the Apetit brand, the sale of retail products was at the previous year's level. The hotel, restaurant and catering sector continued its strong growth, thanks to the good level of sales in new frozen ready meals and frozen vegetables. Sales to the food industry and exports were down year on year.
Operating profit in the Frozen Foods business was at the level of the previous year.
The development focus in the operation of the Frozen Foods business was on the order/delivery process. The themes of Finnishness and ‘locally produced food, straight from the freezer' were again emphasised in the marketing of Apetit frozen vegetables and frozen potato products.
The number of personnel in Frozen Foods in January-March was 187 (172).
Investment during the period totalled EUR 0.2 (0.0) million.
The first-quarter net sales of the Seafood business were up by about 2% on the figure for the same quarter a year earlier. This growth was attributable to the Finnish Seafood business. In the Norwegian and Swedish Seafood businesses there was a slight drop in net sales measured in euros.
Net sales in the Finnish Seafood business were boosted by the incorporation of Myrskylän Savustamo into the Group at the start of June 2010, and by the higher average sales prices. Factors adversely affecting net sales were the reduced number of Kalatori service counters and the fact that all Easter sales occurred in April this year, in contrast to the previous year.
Measured in local currencies, net sales were down by about 8% in the Norwegian and Swedish Seafood businesses. The drop in net sales was a result of discontinuing the sale of smoked salmon to the businesses´ key customer in autumn 2010 and the fact that Easter sales occurred in April. The growth in sales of minced fish products continued in the Norwegian market. The sales growth in shellfish continued to be good in the Swedish and Finnish markets.
The first-quarter result for the Seafood business was down year on year. The decline in profit was due to the Norwegian and Swedish Seafood business.
The result for the Finnish Seafood business was almost unchanged. Due to tight supply, the raw material costs of salmon and rainbow trout reached a record high in the first quarter. Price rises were introduced during the period in order to compensate for the increased costs. With raw material prices remaining high there will be a further need for price rises. The associated company Taimen Group, which specialises in fish farming and fry and fingerling production, did not have the expected positive impact on the result in the first quarter. Lifting farmed fish from the water and gutting them was adversely affected by the challenging ice conditions, and this temporarily decreased Taimen's delivery performance.
Launched in February, the cost-efficiency programme in the Finnish Seafood business is aimed at making dramatic cuts in fixed costs, and in April this progressed to the implementation phase. In order to make better use of Group synergies it was decided to concentrate Apetit Kala Oy's sales and financial administration functions in the Group's other units. The company's procurement, production and logistics functions will be centralised in Kuopio. The organisational changes will result in the loss of nine jobs in Kuopio and the creation of a total of three jobs in Espoo and Säkylä. These changes will take place by the end of May. The reorganisation of white-collar positions will mean that non-recurring costs of about EUR 0.1 million will be recognised in the second-quarter result. In connection with the cost-efficiency programme, a decision was also made not to fill four white-collar positions that have become vacant since the end of last year. It is estimated that annual savings of about EUR 0.9 million will be achieved with these personnel solutions and by cutting IT, HR and marketing expenses. The programme will take full effect at the beginning of the second half of the year.
The first-quarter profitability of the Norwegian and Swedish Seafood businesses was down year on year. It has been possible to pass on to sales prices only a proportion of the strong rise in the raw material costs of shellfish occurring since last summer, and this has caused a drop in the gross margin.
In April, Maritim Food decided to shut down its Stabburveien plant in Fredrikstad, Norway, and concentrate the production of minced fish products and dressings at its Råbekksvingen plant, also in Fredrikstad, in order to improve profitability and productivity. Shutting down the Stabburveien plant will mean the discontinuation of smoked-fish production. The changes will take place in 2011. The estimated annual performance improvement from concentrating production is some EUR 0.5 million, and this will begin to materialise in the third quarter of 2011. Non-recurring costs from the reorganisation of production and the shutdown of one production plant are estimated at about EUR 1.5 million and will be recognised in the second-quarter result of the Seafood business.
The number of personnel in the Seafood business totalled 345 (354). The reduction in average personnel was due in part to the smaller number of Kalatori service counters in Finland, though personnel numbers were also boosted by the arrival of the Myrskylän Savustamo Group, which joined the Group in summer 2010, and the launch of the Kustavi plant last autumn. The number of personnel in the Norwegian and Swedish Seafood businesses decreased due to the jobs lost in the autumn as a result of the adjustment measures in production.
Investment in the Seafood business totalled EUR 0.1 (0.3) million.
First-quarter net sales in the Grains and Oilseeds business were up by 21% year on year. This growth was a result of the higher market prices than a year earlier. The substantial rise in grain and oilseed market prices was the result of tighter supply and the continuing strong demand on the world market.
The first-quarter operating profit in the Grains and Oilseeds business was up by EUR 0.5 million on the previous year's first-quarter figure. This was attributable to the increased net sales as well as the realisation of synergy benefits from combining the Grains and Oilseeds businesses.
In the first quarter, market conditions were affected not only by the demand and supply situation but also the comparatively low global grain and oilseed stocks. This kept market prices high. As the second quarter drew near, the market started to pay increasing attention to the spring's sowing area forecasts, weather and harvest prospects. These will have an impact on future price levels and grain flows, and will create business opportunities in both the current and the next crop season.
Deliveries in the Grains and Oilseeds business will continue to be high in the second quarter, as end users in various markets cover their needs before the new harvest.
The Grains and Oilseeds business employed 59 (59) people.
Investment in the Grains and Oilseeds business totalled EUR 0.3 (0.1) million and focused on the packaging facility being constructed at the Kirkkonummi vegetable oil mill. Totalling over EUR 2 million, the packaging plant investment will be completed by the end of the year. This investment will boost Avena's competitiveness in the market for packaged vegetable oil products.
The Other Operations segment comprises the service company Apetit Suomi Oy, Group Administration, items not allocated under any of the business segments and the associated companies Sucros Ltd and Ateriamestarit Oy. The cost impact of the services produced by Apetit Suomi Oy is an encumbrance on the operating result of the Group's businesses in proportion to their use of the services.
Net sales from the sale of services in the Other Operations segment were at the previous year's level. The operating profit includes EUR -0.2 (-0.1) million as the share of the profit of associated companies.
Investment in Other Operations totalled EUR 0.0 (0.0) million.
DECISIONS OF THE ANNUAL GENERAL MEETING
Lännen Tehtaat plc's Annual General Meeting was held in Säkylä on 31 March 2011. The Annual General Meeting adopted the parent company's financial statements and the consolidated financial statements, and discharged the members of the Board of Directors and of the Supervisory Board and the Chief Executive Officer from liability for the financial year 2010.
Dividend distribution
The AGM decided to distribute a dividend of EUR 0.90 per share, in accordance with the Board's proposal. The dividend was paid on 12 April 2011.
Authorisations to issue shares
The Board of Directors has been authorised by the Annual General Meeting to decide on issuing new shares and transferring Lännen Tehtaat plc shares held by the company, and to do this in one or more lots as a share issue with a total of no more than 761,757 shares. The share issue authorisation covers all Lännen Tehtaat plc shares in the company's possession, i.e. 130,000 shares. The maximum number of new shares that can be issued is 631,757.
The subscription price for each new share shall be at least the share's nominal value, or EUR 2. The transfer price for Lännen Tehtaat plc shares held by the company must be at least the current value of the share at the time of transfer, determined by the price quoted in public trading held by NASDAQ OMX Helsinki Ltd, but when implementing share-based incentive plans shares can also be issued without consideration.
The authorisation concerns the right to deviate from the shareholders' pre-emptive subscription right (targeted issue) if the company has an important financial reason to do so, such as developing the company's capital structure, financing and implementing corporate acquisitions or other arrangements, or implementing a share-based incentive plan. This authorisation also includes the right to offer shares instead of money, also against capital consideration in kind or otherwise under certain conditions or by using right of set-off; and the right to decide on the share subscription price and other terms and circumstances concerning the share issue.
The authorisation is valid until the next AGM. The authorisation revoked the earlier authorisation to issue shares, given on 30 March 2010.
SHARES AND TRADING
The number of Lännen Tehtaat plc shares traded on the stock exchange during January-March was 176,545 (294,715), representing 2.8% (4.7%) of the total number of shares. The highest share price quoted was EUR 18.80 (18.51) and the lowest EUR 17.50 (15.51). The average price of shares traded was EUR 17.95 (17.23). The share turnover for the period was EUR 3.2 (5.1) million. At the end of March, the market capitalisation totalled EUR 118.6 (107.4) million.
At the close of the first quarter, the company had in its possession a total of 130,000 of its own shares acquired during previous years, with a combined nominal value of EUR 0.26 million. These shares represent 2.1% of the company's total number of shares and of the total number of votes.
FLAGGING ANNOUNCEMENTS
No flagging announcements were made during the first quarter.
CORPORATE ADMINISTRATION AND AUDITORS
At its organisational meeting on 14 April 2011, Lännen Tehtaat plc's Supervisory Board elected Timo Miettinen chairman of the Supervisory Board and Marja-Liisa Mikola-Luoto deputy chairman.
The Supervisory Board elected the following as members of the company's Board of Directors: Heikki Halkilahti, Aappo Kontu, Matti Lappalainen, Hannu Simula, Jorma J. Takanen and Helena Walldén. Matti Lappalainen was elected chairman of the Board of Directors and Hannu Simula was elected deputy chairman.
Hannu Pellinen, APA, and PricewaterhouseCoopers Oy Authorized Public Accountants, with Tomi Moisio, APA CPFA as responsible auditor, were appointed as auditors for Lännen Tehtaat plc by the Annual General Meeting on 31 March 2011.
SEASONALITY OF OPERATIONS
In accordance with the IAS 2 standard, the historical cost of inventories includes a systematically allocated portion of the fixed production overheads. In production that focuses on seasonal crops, raw materials are processed into finished products mainly during the final quarter of the year, which means that the inventory volumes and their balance-sheet values are at their highest at the end of the year. Since the entry of the fixed production overheads included in the historical cost as an expense item is deferred until the time of sale, most of the Group's annual profit is accrued in the final quarter. The seasonal nature of operations is most marked in Frozen Foods and in the associated company Sucros, due to the link between production and the crop harvesting season.
In the Seafood business, the sales of Apetit Kala Oy and Myrskylän Savustamo Oy peak at weekends and on holidays. A significant proportion of the entire year's profit in the Seafood business depends on the success of the Christmas season. Due to the growing season for fish, only a small amount of the profit accumulated for the Taimen Group, which reports as an associated company, normally accrues during the summer months. As Easter can take place in either the first or the second quarter, this can affect the comparability of net sales and profit in the Frozen Foods and Seafood businesses between different years. Net sales in the Grains and Oilseeds business vary from one year and quarter to the next to a greater extent than in the other businesses, being dependent on the demand and supply situation and on the price levels domestically and on other markets.
SHORT-TERM RISKS AND UNCERTAINTIES
The most significant short-term risks for the Lännen Tehtaat Group concern the following: the management of raw material price changes and currency risks; availability of raw materials; the impact of seafood price rises on consumer demand; the impact of the rise in energy prices; the implementation of the cost-efficiency programme in the Finnish Seafood business; the change in the production plant structure of the Norwegian company; the solvency of customers and the delivery performance of suppliers and service providers; changes in the Group's business sectors and customerships; and corporate acquisitions and the subsequent integration processes.
SIGNIFICANT EVENTS SINCE THE END OF THE REVIEW PERIOD
In regard to implementation of the cost-efficiency programme in the Finnish Seafood business, decisions concerning the white-collar employees of Apetit Kala were made in April and are discussed more thoroughly in the overview of operating segments, under Seafood.
Concerning the Norwegian Seafood business, it was also decided in April to shut down one of the two Maritim Food production plants in Fredrikstad. The impact of this decision is discussed in the overview of operating segments, under Seafood.
ASSESSMENT OF PROBABLE FUTURE DEVELOPMENT
The Group's net sales will be affected particularly by the level of activity in grain and oilseed markets and by changes in the price level of grains and oilseeds.
Thanks to the measures taken to develop the Seafood business, and the positive delivery prospects in the Grains and Oilseeds business for the short term, the second quarter operating profit, excluding non-recurring items, is expected to be better than the previous year's level.
The profit performance in the second half of the year will be influenced substantially by the extent of activity in the grain and oilseed markets, which at this stage of the year is still difficult to assess. Thanks to the measures taken to develop the Group's different businesses, and thanks to the corporate acquisitions made in 2010, the full-year operating profit, excluding non-recurring items, is expected to be better than the previous year's level. Profit accrual is expected to be weighted heavily towards the latter part of the year, as in 2010.
CONSOLIDATED INCOME STATEMENT
EUR million Jan- March Jan- March Jan -
Dec
2011 2010 2010
Net sales 84.0 74.8 308.7
Other operating income 0.2 0.4 1.4
Operating expenses -81.7 -72.8 -299.4
Depreciation -1.4 -1.3 -5.3
Impairments 0.0 0.0 -0.1
Share of profits of associated companies -0.2 -0.1 3.0
Operating profit 0.8 0.9 8.3
Financial income and expenses -0.4 0.3 0.1
Profit before taxes 0.5 1.2 8.4
Income taxes -0.3 -0.4 -1.9
Profit for the period 0.2 0.8 6.5
Attributable to
Equity holders of the parent 0.3 0.8 6.5
Non-controlling interests -0.1 - -
Basic and diluted earnings per share,
calculated of the
profit attributable to the shareholders
of the parent
company, EUR 0.04 0.13 1.04
STATEMENT OF COMPREHENSIVE INCOME
EUR million Jan- March Jan- March Jan -
Dec
2011 2010 2010
Profit for the period 0.3 0.8 6.5
Other comprehensive income
Cash flow hedges 1.0 -0.3 1.1
Taxes related to cash flow hedges -0.3 0.1 -0.3
Translation differences 0.0 0.5 0.8
Total comprehensive income 1.0 1.1 8.1
Attributable to
Equity holders of the parent 1.1 1.1 8.1
Non-controlling interests -0.1 - -
CONSOLIDATED STATEMENT OF FINANCIAL
POSITION
EUR million 31 March 31 March 31 Dec
2011 2010 2010
ASSETS
Non-current assets
Intangible assets 5.7 5.6 6.0
Goodwill 8.7 7.1 8.6
Tangible assets 36.4 37.4 37.0
Investment in associated companies 33.8 24.0 33.9
Available-for-sale investments 0.1 0.1 0.1
Receivables 0.5 1.9 0.7
Deferred tax assets 1.3 0.9 1.4
Non-current assets total 86.4 76.9 87.5
Current assets
Inventories 66.8 40.8 55.0
Receivables 35.1 46.3 34.5
Income tax receivable 0.1 0.1 0.2
Financial assets at fair value through 0.1 5.3 7.1
profits
Cash and cash equivalents 9.2 3.9 7.5
Current assets total 111.3 96.3 104.4
Total assets 197.7 173.2 191.9
EUR million 31 March 31 March 31 Dec
2011 2010 2010
EQUITY AND LIABILITIES
Equity attributable to the equity holders 131.8 133.4 136.2
of the parent
Non-controlling interests 2.6 - 2.7
Total equity 134.4 133.4 138.9
Non-current liabilities
Deferred tax liabilities 4.0 3.7 4.4
Long-term financial liabilities 2.1 2.0 2.1
Non-current provisions 0.0 0.2 0.0
Other non-current liabilities 4.6 0.0 4.6
Non-current liabilities total 10.7 6.0 11.1
Current liabilities
Short-term financial liabilities 16.8 0.4 1.8
Income tax payable 1.5 1.9 1.0
Trade payables and other liabilities 34.2 31.6 39.1
Current liabilities total 52.5 33.9 41.9
Total liabilities 63.3 39.9 53.0
Total equity and liabilities 197.7 173.2 191.9
CONSOLIDATED STATEMENT OF CASH FLOWS
EUR million Jan- March Jan- March Jan -
Dec
2011 2010 2010
Net profit for the period 0.2 0.8 6.5
Adjustments. total 1.5 -0.1 4.9
Change in net working capital -21.2 -15.3 -7.4
Interests paid -0.1 -0.7 -1.1
Interests received 0.0 0.1 0.3
Taxes paid -0.2 -0.1 -2.6
Net cash flow from operating activities -19.8 -15.3 0.6
Investments in tangible and intangible -0.6 -0.4 -3.1
assets
Proceeds from sales of tangible and 0.0 0.4 0.5
intangible assets
Acquisition of associated companies - - -8.1
Transactions with non-controlling - - 2.7
interests
Purchases of other investments - - -32.9
Proceeds from sales of other investments 7.0 12.0 43.0
Dividends received from investing - - 1.5
activities
Net cash flow from investing activities 6.4 11.9 3.5
Proceeds from/repayments of short-term 15.0 -0.2 0.6
loans
Proceeds from/repayments of long-term - -0.3 -0.3
loans
Payment of financial lease liabilities - 0.0 0.0
Dividends paid - - -4.7
Cash flows from financing activities 15.0 -0.5 -4.4
Net change in cash and cash equivalents 1.6 -4.0 -0.3
Cash and cash equivalents at the 7.5 7.9 7.9
beginning of the period
Cash and cash equivalents at the end of 9.2 3.9 7.5
the period
Purchases of other investments and
proceeds from
sales of other investments are cash flows
related
to short-term fixed income funds.
STATEMENT OF CHANGES
IN
SHAREHOLDERS' EQUITY
A = Shareholders'
equity at 1 January
B = Dividend
distribution
C = Transactions
with NCI
D = Other changes
E = Total
comprehensive
income
F = Shareholders'
equity at 31 March
January - March 2011
EUR million A B C D E F
Share capital 12.6 - - - - 12.6
Share premium 23.4 - - - - 23.4
account
Net unrealised gains -0.8 - - - 0.8 -0.1
Other reserves 7.2 - - - 0.0 7.2
Own shares -1.8 - - - - -1.8
Translation 0.3 - - - 0.0 0.3
differences
Retained earnings 95.3 -5.6 - 0.0 0.3 90.0
Attributable to 136. -5.6 0.0 0.0 1.0 131.8
equity holders of 2
the parent
Non-controlling 2.7 - - - -0.1 2.6
interests (NCI)
Total equity 138. -5.6 0.0 0.0 0.9 134.4
9
January - March 2010
EUR million A B C D E F
Share capital 12.6 - - - - 12.6
Share premium 23.4 - - - - 23.4
account
Net unrealised gains 0.0 - - - -0.2 -0.2
Other reserves 7.2 - - - 0.0 7.2
Own shares -1.8 - - - - -1.8
Translation -0.5 - - - 0.5 0.0
differences
Retained earnings 96.5 -4.7 - -0.2 0.8 92.1
Attributable to 137. -4.7 - -0.2 1.1 133.4
equity holders of 3
the parent
Non-controlling - - - - - -
interests (NCI)
Total equity 137. -4.7 - -0.2 1.1 133.4
3
BASIS OF PREPARATION AND ACCOUNTING POLICIES
The Interim Report has been prepared in accordance with IAS 34,
Interim Financial
Reporting. The accounting policies adopted are consistent with those
of the Group's annual financial statements for the year ended
31 December 2010. New standards and interpretations adopted in 2011
had
no significant effects on this Interim Report.
SEGMENT
INFORMATION
Operating
segments,
January -
March 2011
EUR million Froze Seafood Grains and Other Total
n
Foods Oilseeds Operations
Total segment 12.6 19.3 51.9 0.5 84.4
sales
Intra-group - 0.0 0.0 -0.4 -0.4
sales
Net sales 12.6 19.3 51.9 0.1 84.0
Share of profits
of associated
companies
included in
operating
profit - 0.0 - -0.2 -0.2
Operating profit 0.3 -0.5 2.5 -1.5 0.8
Gross
investments in
non-current
assets 0.2 0.1 0.3 0.0 0.6
Corporate
acquisitions
and other
share purchases - - - - -
Depreciations 0.5 0.5 0.2 0.2 1.4
Impairments - 0.0 - - 0.0
Personnel 187 345 59 11 601
Operating
segments.
January -
March 2010
EUR million Froze Seafood Grains and Other Total
n
Foods Oilseeds Operations
Total segment 12.8 19.0 43.0 0.4 75.2
sales
Intra-group 0.0 0.0 0.0 -0.3 -0.3
sales
Net sales 12.7 19.0 43.0 0.1 74.8
Share of profits
of associated
companies
included in
operating
profit - - - -0.1 -0.1
Operating profit 0.3 -0.0 2.0 -1.2 0.9
Gross
investments in
non-current
assets 0.0 0.3 0.1 0.0 0.4
Corporate
acquisitions
and other
share purchases - - - - -
Depreciations 0.5 0.5 0.2 0.2 1.3
Impairments - 0.0 - - 0.0
Personnel 172 354 59 11 596
Operating
segments,
January -
December 2010
EUR million Froze Seafood Grains and Other Total
n
Foods Oilseeds Operations
Total segment 45.1 80.9 181.9 2.6 310.5
sales
Intra-group 0.0 0.0 0.0 -1.7 -1.8
sales
Net sales 45.1 80.9 181.9 0.9 308.7
Share of profits
of associated
companies
included in
operating
profit - 0.6 - 2.4 3.0
Operating profit 3.4 -1.8 7.2 -0.5 8.3
Gross
investments in
non-current
assets 1.2 1.1 0.7 0.2 3.1
Corporate
acquisitions
and other
share purchases - 10.5 - - 10.5
Depreciations 2.2 1.9 0.7 0.6 5.3
Impairments - 0.1 - - 0.1
Personnel 199 351 61 10 621
KEY INDICATORS
31 March 31 March 31 Dec
2011 2010 2010
Shareholders' equity per share, EUR 21.30 21.56 22.01
Equity ratio, % 68.0 77.0 72.4
Gearing, % 7.2 -5.0 -7.7
Gross investments in non-current 0.6 0.4 3.1
assets, EUR million
Corporate acquisitions and other
share purchases,
EUR million - - 10.5
Average number of personnel 601 596 621
Average number of shares, 1,000 pcs 6 188 6 188 6 188
The key figures in this Interim
Report are
calculated with same accounting
principles than
presented in the 2010 annual
financial statements.
CONTINGENT LIABILITIES, CONTINGENT
ASSETS
AND OTHER COMMITMENTS
EUR million 31 March 31 March 31 Dec
2011 2010 2010
Mortgages given for debts
Real estate mortgages 2.8 2.3 2.8
Guarantees 15.5 6.1 12.1
Non-cancellable other leases,
minimum lease payments
Real estate leases 5.6 4.5 5.9
Other leases 0.5 0.8 0.7
DERIVATIVE INSTRUMENTS
Outstanding nominal values of
derivate instruments
Forward currency contracts 7.8 2.8 6.6
Commodity derivative instruments 10.1 6.2 13.9
CONTINGENT ASSETS
The present value of proceeds from
the sale of
shares in the joint entry account 0.7 0.7 0.7
INVESTMENT COMMITMENTS
Frozen Foods 0.8
Grains and Oilseeds 1.7
OTHER COMMITMENTS
Based on the shareholder agreements
on the ownership
arrangement between Apetit Kala Oy
and Taimen Oy,
once certain terms and conditions
are met the contracting
parties are entitled to terminate
the cross ownership
at fair value.
The liability in any termination of
ownership will, on the
basis of IAS 32 be recognised under
non-current liabilities.
The receivable arising in
connection with this may not,
under IFRS rules, be recognised.
CHANGES IN TANGIBLE ASSETS
EUR million 31 March 31 March 31 Dec
2011 2010 2010
Book value at the beginning of the 37.0 37.9 37.9
period
Additions 0.6 0.3 2.6
Additions through acquisitions - - 0.7
Disposals 0.0 0.0 -0.3
Depreciations and impairments -1.2 -1.1 -4.4
Other changes 0.0 0.3 0.5
Book value at the end of the period 36.4 37.4 37.0
TRANSACTIONS WITH ASSOCIATED
COMPANIES
AND JOINT VENTURES
EUR million Jan- March Jan- March Jan - Dec
2011 2010 2010
Sales to associated companies 0.1 0.1 1.1
Sales to joint ventures 2.2 2.2 7.3
Purchases from associated companies 3.2 0.6 6.6
Long-term receivables from - 1.5 -
associated companies
Long-term receivables from joint 0.1 0.1 0.1
ventures
Trade receivables and other
receivables from
associated companies 1.5 1.5 1.6
Trade receivables and other
receivables from
joint ventures 1.0 0.9 0.7
Trade payables and other
liabilities to associated
companies 0.7 0.0 0.4
LÄNNEN TEHTAAT PLC
Board of Directors
Further information: CEO Matti Karppinen, tel. +358 40 8448 692
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Main media
www.lannen.fi
