INTERIM REPORT 1 JANUARY - 30 SEPTEMBER 2010
SUOMINEN CORPORATION INTERIM REPORT 22 OCTOBER 2010 AT 12.30 P.M.
INTERIM REPORT 1 JANUARY - 30 SEPTEMBER 2010
THIRD QUARTER ON RED
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| KEY FIGURES | 7-9/2010 | 7-9/2009 | 1-9/2010 | 1-9/2009 |1-12/2009 |
| | | | | | |
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| Net sales, EUR | 43.4 | 44.2 | 128.1 | 134.5 | 179.4 |
| million | | | | | |
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| Operating profit, EUR | -1.8 | 1.0 | -2.2 | 6.1 | 6.7 |
| million | | | | | |
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| Profit/loss for the | -2.1 | -0.4 | -4.0 | 1.2 | 0.9 |
| period, EUR million | | | | | |
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| Earnings/share, EUR | -0.05 | -0.01 | -0.10 | 0.03 | 0.02 |
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| Cash flow from | 0.09 | 0.12 | 0.00 | 0.69 | 0.74 |
| operations/share, EUR | | | | | |
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Outlook: Net sales for the whole year is estimated to be lower than in 2009 and
the operating profit for 2010 is expected to be negative.
GROUP FINANCIAL RESULTS
Suominen Corporation generated net sales of EUR 43.4 million (44.2) in the third
quarter. Operating profit was EUR -1.8 million (1.0), profit before taxes EUR
-2.9 million (-0.6) and profit after taxes EUR -2.1 million (-0.4).
The third quarter result was negative mostly due to low production during the
summer months.
Net sales for the nine-month period totalled EUR 128.1 million (134.5).
Operating profit was EUR -2.2 million (6.1), profit before taxes EUR -5.3
million (1.4) and profit after taxes EUR -4.0 million (1.2).
Suominen's net sales for the nine-month period in 2010 declined by 5 per cent
compared to the corresponding period in 2009. Reasons behind the decrease were
the decline in the prices of wet wipes in the beginning of the year and the
decline in the delivery volumes of nonwovens.
Cost-savings measures could not compensate for the decrease in net sales and
delivery volumes. The rise in raw material prices continued until the end of
summer, and has levelled off thereafter. The majority or current sales contracts
adjust sales prices in line with rises in raw material costs some months after
costs have risen. The price increase had a considerable negative impact on the
Group's result.
Employee negotiations were started in Flexibles in September, with the purpose
of safeguarding the competitiveness of the operations. The proposal includes the
discontinuation of the Nastola plant's operations in 2011. If the proposal is
realised, it would represent an estimated EUR 2.5 million in non-recurring
costs, a big part of which would be incurred in the course of 2010.
The company negotiated an amendment to the financial covenants of the present
credit agreements in regard to the situation on 30 September 2010. Negotiations
on the terms and conditions of financing are underway, for the future too, and
the intention is to reach a conclusion in the fourth quarter.
Investments still remained on a low level.
Cost-saving and operational enhancement programme
Costs were cut in the amount of EUR 2.5 million through Suominen's Stairs to Top
operational enhancement programme. The most significant single measure taken was
the transfer of Sweden's flexible packaging production to Poland. Other cost
savings resulted from optimisation of material use, reduction in number of
personnel and the effects of earlier investments to boost efficiency.
Financing
Repayments of interest-bearing liabilities were EUR 5.0 million. Liabilities
include capital loans of EUR 6.0 million (8.0). Net financial expenses were EUR
3.2 million (4.7) or 2.5 per cent (3.5) of net sales. A total of EUR 2.2 million
was tied up in the working capital. A total of EUR 11.5 million of trade
receivables was sold to the bank (9.7). The equity ratio was 34.0 per cent
(29.5). When the capital loans are included in shareholders' equity, the equity
ratio was 38.8 per cent (36.0) and the ratio of liabilities to shareholders'
equity 99.7 per cent (115.9). Cash flow from operations was EUR 0.00 per share
(0.69).
Investments
The company's gross investments in production totalled EUR 4.6 million (3.0).
Planned depreciation amounted to EUR 7.1 million (7.6). Codi Wipes accounted for
EUR 0.4 million (0.7), Nonwovens EUR 1.5 million (1.0) and Flexibles EUR 2.6
million (1.3) of total investments. Investments were efficiency-enhancement and
maintenance investments.
SEGMENT RESULTS
In the nine-month period, net sales of the Wiping business area totalled EUR
79.1 million and declined by 8 per cent on the previous year. The business
area's operating profit was EUR -2.1 million (3.4). The increasing losses in the
third quarter were affected by the low level of summertime production in both
units.
Net sales of Codi Wipes, at EUR 42.9 million, declined by 10 per cent on the
previous year. Sales of baby wipes and moist toilet wipes decreased while sales
of personal care wipes were higher than a year earlier. Although average sales
prices are lower than in the previous year, during 2010 they have remained
stable. As a result of savings measures, the unit's operating costs have
decreased since the previous year.
Net sales of Nonwovens decreased by 8 per cent to EUR 40.9 million. Sales of
thermobonded hygiene products material clearly decreased. Delivery volumes of
hydroentangled wiping materials fell, while the sales of materials used in
health care remained at the previous year's level. Sales in the U.S. markets
clearly declined in comparison with the corresponding period in the previous
year. However, sales in the third quarter in the Russian and U.S. markets
clearly increased compared to the previous quarters.
Production was low during the summer due to the holiday shutdown, but since
then, the hydroentanglement lines have been operating at a good level. The cost
of main raw materials continued to rise until summer, then slowed down and
partly levelled off.
Net sales of Flexibles totalled EUR 49.6 million (49.5) in the nine-month
period. Operating profit was EUR 0.0 million (3.1). Sales of hygiene packaging,
food packaging, and security and system packaging were on par with the previous
year. Sales of retail packaging were lower than a year earlier. Deliveries to
Russia and eastern Central Europe increased.
The increase in the prices of plastic-based raw materials negatively affected
the result of Flexibles. During the comparison period, the business area
benefited from the decrease in raw material prices that was seen in early 2009.
Considering the price level at the start of 2010, the increase in raw material
prices represents approximately EUR 2.5 million in additional expenses in the
business area's result.
Employee negotiations were started in Flexibles in Finland on 13 September 2010.
The negotiation proposal concerns personnel at the Tampere and Nastola plants,
and around 120 people will be affected by the possible head-count reduction.
According to the proposal, the plans concern the discontinuation of the Nastola
plant's operations and the transfer of production to other Flexibles plants. In
addition, the plans will involve a reorganisation of the Tampere plant's
production and partial transfer to plants in Poland and Ikaalinen. The employee
negotiations are expected to end on 25 October 2010.
SHARE CAPITAL AND SHARES
Share capital and share issue
On 30 June 2010, the registered number of issued shares of Suominen totalled
23,720,112 shares. In the share issue implemented 9 - 23 June 2010, new shares
in the amount of 23,108,629 were entered in the trade register on 1 July 2010
and combined with the company's existing shares. Following the registration, the
total number of Suominen's shares is 47,395,014 shares. Fully paid share capital
is EUR 11,860,056.
Share trading and price
The number of Suominen Corporation shares traded on NASDAQ OMX Helsinki from 1
January to 30 September 2010 was 4,536,139 shares. The trading price varied
between EUR 0.63 and EUR 1.74. The final trading price was EUR 0.66, giving the
company a market capitalisation of EUR 31.2 million on 30 September 2010.
The company's own shares
On 1 January 2010, the company held 682 of its own shares, accounting for 0.0
per cent of the share capital and votes.
The Annual General Meeting of Shareholders held in 2009 authorised the Board of
Directors to decide on the acquisition of a maximum of 200,000 of the company's
own shares. Based on the authorisation, the company has repurchased 200,000 of
its own shares between 26 February and 27 July 2010. Average price per share was
approximately EUR 1.06. The Meeting also authorised the Board of Directors to
decide on the conveyance of a maximum of 200,682 of the company's own shares.
Within the authorisation the company has conveyed 31,877 of its own shares as
emoluments to the Board of Directors in the period under review. The price of
the conveyed shares was EUR 1.60 per share.
The Annual General Meeting of Shareholders held on 23 March 2010 authorised the
Board of Directors to decide on the acquisition of a maximum of 200,000 of the
company's own shares. The Meeting also authorised the Board of Directors to
decide on the conveyance of a maximum of 200,682 of the company's own shares.
The board of Directors did not exercise its authorities to convey the company's
own shares during the period under review.
On 30 September 2010, Suominen Corporation held a total of 168,805 of its own
shares, accounting for 0.4 per cent of the share capital and votes.
Stock options
Suominen has stock option plans 2006, 2007 and 2009. The Board of Directors has
decided to amend the terms and conditions of the option plans so that an option
holder has the right to the same proportion of shares in the company as before
the rights offering, i.e. one option right will entitle a holder to subscribe to
two shares. The subscription prices per share were also adjusted.
Stock options marked with the symbol 2006A have expired and stock options marked
with the symbol 2006B have been returned to the company. According to the 2006C
stock option plan, a total of 100,000 stock options have been issued having an
original subscription price of EUR 1.66 per share. The new number of shares that
can be subscribed under the stock option plans is 200,000, and the new
subscription price is EUR 1.05. The subscription period for the 2006C stock
options is from 2 May 2010 until 30 October 2011.
A total of 85,000 stock options marked with the symbol 2007A have been issued
having an original subscription price of EUR 3.44 per share. The new number of
shares that can be subscribed under the stock option plans is 170,000, and the
new subscription price is EUR 1.94. A total of 90,000 stock options marked with
the symbol 2007B have been issued having an original subscription price of EUR
1.66 per share. The new number of shares that can be subscribed under the stock
option plans is 180,000, and the new subscription price is EUR 1.05. The
subscription period for the 2007A stock options is from 2 May 2009 until 30
October 2010 and for 2007B stock options from 2 May 2010 until 30 October 2011.
A total of 150,000 stock options marked with the symbol 2009A have been issued
having an original subscription price of EUR 1.46 per share. The new number of
shares that can be subscribed under the stock option plans is 300,000, and the
new subscription price is EUR 0.95. The subscription period for the 2009A stock
options is from 2 May 2011 to 30 October 2012.
As the registered number of Suominen's issued shares totals 47,395,014, the
number of shares may rise to a maximum of 48,245,014 after stock option
subscriptions.
Other authorisation for the board of directors
The Board of Directors still has an authorisation to issue 300,000 more stock
options in accordance with the 2009 stock option plan which would entitle
holders to subscribe to 600,000 Suominen shares. In addition, the Board of
Directors also has authorisation to issue 6,325,098 additional new shares as
decided by the Extraordinary General Meeting held on 1 June 2010. The Board of
Directors is not otherwise authorised to issue special rights entitling to
shares, option rights and/or convertible bonds.
NEAR-FUTURE RISKS AND UNCERTAINTIES
The estimate concerning the development of Suominen's net sales is based in part
on forecasts and action plans provided by the Group's customers. Changes in
these forecasts and plans resulting from changes in the market situation or
changes in customers' inventory levels could affect Suominen's net sales. Due to
the uncertain global economic situation, the forecasts are vulnerable to a
significant amount of uncertainty.
Nonwovens and Flexibles purchase oil-based raw materials to the value of over
EUR 40 million annually. In addition, significant amounts of viscose, printing
inks, and solvents are also purchased. Rapid fluctuations in the world market
prices of raw materials affect Suominen's profitability.
Suominen does not have any competitors with a fully similar product offering.
However, the company has numerous regional, national or international
competitors in its different product groups. There is production oversupply in
most product groups. If Suominen is not able to compete with an attractive
product offering, it may lose some of its market share. The competition may lead
to increased pricing pressure on the company's products.
Suominen's cost-saving and operational enhancement efforts are focused on areas
such as improving yield, increasing machine speeds, and reducing changeover
time. The benefits of these efforts will be most evident if production volumes
will increase. Delays in the implementation of measures or their failure would
have a negative impact on the company's result.
The financial covenants of Suominen's credit agreements provide a maximum level
for the ratio of net debts to EBITDA. Due to the situation at the end of
September, the company negotiated discharge from these special conditions, and
also intends to negotiate on permanent amendments to the conditions on credit
agreements by the end of the year. If agreement is not reached with the
financiers in these negotiations, the lenders have the right to use acceleration
clauses and declare the loans due and payable prior maturity.
The sensitivity of Suominen's group goodwill, and possible changes in the
general assumptions are described in the notes to the financial statements for
2009. Suominen's business risks are described in the report of the Board of
Directors for 2009, and in the Finnish offering memorandum dated on 4 June 2010.
OUTLOOK
Demand for Suominen's products is evaluated on the basis of customer contracts
and use forecast provided by customers.
Demand for Suominen's products and deliveries to customers in 2010 have been
below the level of the corresponding period in 2009. Demand is expected to
remain at current level and net sales for the year is estimated to be lower than
in 2009. Net sales are, however, expected to be higher in the latter half of
2010 than in the first half.
Suominen's raw material costs clearly increased in the first half of the year.
The rise in oil-based raw material prices that continued through the summer has
stopped and the prices have stabilised. Savings in the company's operating costs
have been achieved and operating costs are expected to remain at a lower level
than in 2009. The employee negotiations taking place in Flexibles are expected
to end on 25 October 2010. If the negotiations are realised as proposed, it
would represent an estimated EUR 2.5 million in non-recurring costs, a big part
of which would be incurred in the 2010 budget.
Due to the decrease in sales volumes, lower margins and possible non-recurring
expenses, the operating profit for 2010 is expected to be negative.
SUOMINEN CORPORATION CONSOLIDATED 1 JANUARY - 30 SEPTEMBER 2010
This interim report has been prepared in compliance with IAS 34 Interim
Financial Reporting. Principles for preparing the interim report are the same as
those used for preparing the financial statements for 2009, and this interim
report should be read parallel to the financial statements for 2009. Changes to
published accounting standards and interpretations, together with the new
accounting standards that came into force on 1 January 2010, are presented in
the financial statements for 2009. All calculations in this interim report have
been prepared in compliance with revised IAS 1, ‘Presentation of Financial
Statements'. The revised standard is aimed at improving users' ability to
analyse and compare the information given in financial statements by separating
changes in equity of an entity arising from transactions with owners from other
changes in equity. Non-owner changes inequity will be presented in the statement
of comprehensive income.
The figures in this interim report have not been audited.
BALANCE SHEET
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| EUR 1 000 | 9/2010 | 9/2009 | 12/2009 |
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| ASSETS | | | |
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| Non-current assets | | | |
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| Goodwill | 23 404 | 23 404 | 23 404 |
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| Intangible assets | 735 | 718 | 795 |
--------------------------------------------------------------------------------
| Tangible non-current assets | 54 707 | 57 781 | 57 044 |
--------------------------------------------------------------------------------
| Available-for-sale financial | 212 | 212 | 212 |
| assets | | | |
--------------------------------------------------------------------------------
| Held-to-maturity investments | 354 | 225 | 225 |
--------------------------------------------------------------------------------
| Deferred tax assets | 54 | 1 227 | 921 |
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| Non-current assets, total | 79 466 | 83 567 | 82 601 |
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| Current assets | | | |
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| Inventories | 26 203 | 21 366 | 22 598 |
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| Trade receivables | 12 791 | 12 147 | 11 514 |
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| Other current receivables | 2 397 | 2 966 | 4 416 |
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| Income tax receivables | 1 081 | 1 267 | 112 |
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| Cash at bank and in hand | 3 481 | 2 101 | 1 589 |
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| Current assets, total | 45 953 | 39 847 | 40 229 |
--------------------------------------------------------------------------------
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| Assets, total | 125 419 | 123 414 | 122 830 |
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| SHAREHOLDERS' EQUITY AND | | | |
| LIABILITIES | | | |
--------------------------------------------------------------------------------
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| Equity attributable to owners of | | | |
| the parent | | | |
--------------------------------------------------------------------------------
| Share capital | 11 860 | 11 860 | 11 860 |
--------------------------------------------------------------------------------
| Share premium account | 24 681 | 24 681 | 24 681 |
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| Invested non-restricted equity | 9 649 | | |
| fund | | | |
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| Fair value and other reserves | -195 | -717 | -402 |
--------------------------------------------------------------------------------
| Translation differences | 437 | -344 | -117 |
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| Other shareholders' equity | -3 808 | 925 | 667 |
--------------------------------------------------------------------------------
| Shareholders' equity, total | 42 624 | 36 405 | 36 689 |
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| Liabilities | | | |
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| Non-current liabilities | | | |
--------------------------------------------------------------------------------
| Deferred tax liabilities | 2 110 | 3 747 | 3 065 |
--------------------------------------------------------------------------------
| Provisions | 280 | | 280 |
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| Capital loans | 4 000 | 6 000 | 6 000 |
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| Interest-bearing liabilities | 39 015 | 44 001 | 43 390 |
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| Non-current liabilities, total | 45 405 | 53 748 | 52 735 |
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| Current liabilities | | | |
--------------------------------------------------------------------------------
| Interest-bearing liabilities | 12 958 | 9 686 | 9 471 |
--------------------------------------------------------------------------------
| Capital loans | 2 000 | 2 000 | 2 000 |
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| Income tax liabilities | 69 | 828 | 39 |
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| Trade payables and other current | 22 363 | 20 747 | 21 896 |
| liabilities | | | |
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| Current liabilities, total | 37 390 | 33 261 | 33 406 |
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--------------------------------------------------------------------------------
| Liabilities, total | 82 795 | 87 009 | 86 141 |
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--------------------------------------------------------------------------------
| Shareholders' equity and | 125 419 | 123 414 | 122 830 |
| liabilities, total | | | |
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STATEMENT OF INCOME
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| EUR 1 000 | 7-9/2010 | 7-9/2009 | 1-9/2010 | 1-9/2009 |1-12/2009 |
| | | | | | |
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| NET SALES | 43 359 | 44 167 | 128 123 | 134 499 | 179 354 |
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| Cost of goods sold | -42 462 | -39 939 | -121 878 | -118 649 | -158 969 |
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| GROSS PROFIT | 897 | 4 228 | 6 245 | 15 850 | 20 385 |
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| Other operating | 248 | 28 | 712 | 406 | 530 |
| income | | | | | |
--------------------------------------------------------------------------------
| Sales and marketing | -993 | -920 | -2 807 | -2 630 | -3 715 |
| expenses | | | | | |
--------------------------------------------------------------------------------
| Research and | -413 | -614 | -1 384 | -1 613 | -2 297 |
| development | | | | | |
--------------------------------------------------------------------------------
| Administration | -1 484 | -1 695 | -4 612 | -5 443 | -7 144 |
| expenses | | | | | |
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| Other operating | -79 | -55 | -320 | -469 | -1 053 |
| expenses | | | | | |
--------------------------------------------------------------------------------
| OPERATING PROFIT | -1 824 | 971 | -2 166 | 6 100 | 6 706 |
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| Financial income and | -1 028 | -1 528 | -3 154 | -4 656 | -5 701 |
| expenses | | | | | |
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| PROFIT BEFORE INCOME | -2 852 | -557 | -5 320 | 1 444 | 1 005 |
| TAXES | | | | | |
--------------------------------------------------------------------------------
| Income taxes | 707 | 192 | 1 294 | -236 | -145 |
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| PROFIT/LOSS FOR THE | -2 145 | -365 | -4 026 | 1 208 | 860 |
| PERIOD | | | | | |
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| Earnings/share, EUR | -0.05 | -0.01 | -0.10 | 0.03 | 0.02 |
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Earnings per share is presented by taking into account the new shares,
23,674,902, given in the share issue. Share issue adjustment has also an effect
on comparison period´s EPS.
STATEMENT OF COMPREHENSIVE INCOME
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| 1 000 e | 7-9/2010 | 7-9/2009 | 1-9/2010 | 1-9/2009 |1-12/2009 |
| | | | | | |
--------------------------------------------------------------------------------
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| Profit/loss for the | -2 145 | -365 | -4 026 | 1 208 | 860 |
| period | | | | | |
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| | | | | | |
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| Other comprehensive | | | | | |
| income | | | | | |
--------------------------------------------------------------------------------
| Total exchange | 407 | 804 | 499 | 29 | 335 |
| differences on | | | | | |
| foreign operations | | | | | |
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| Fair value changes of | 417 | -10 | 749 | -380 | 48 |
| cash flow hedges | | | | | |
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| Fair value changes of | | | | 73 | 73 |
| available-for-sale | | | | | |
| assets | | | | | |
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| Other | 5 | -76 | 3 | -81 | -9 |
| reclassifications | | | | | |
--------------------------------------------------------------------------------
| Income tax on other | -214 | -207 | -324 | 72 | -119 |
| comprehensive income | | | | | |
--------------------------------------------------------------------------------
| Total other | 615 | 511 | 927 | -287 | 328 |
| comprehensive income | | | | | |
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| | | | | | |
--------------------------------------------------------------------------------
| Total comprehensive | -1 530 | 146 | -3 099 | 921 | 1 188 |
| income for the period | | | | | |
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STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
--------------------------------------------------------------------------------
| EUR 1 000 | Share | Share | Inves | Own | Transl | Fair | Retain | Total |
| | capit | premi | ted | shar | ation | value | ed | |
| | al | um | non-r | es | differ | reserv | earnin | |
| | | accou | estri | | ences | es | gs | |
| | | nt | cted | | | | | |
| | | | equit | | | | | |
| | | | y | | | | | |
| | | | fund | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Total |11 860 |24 681 | 0 | -1 | -117 | -401 | 667 | 36 689 |
| equity at | | | | | | | | |
| 1 Jan. | | | | | | | | |
| 2010 | | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Profit/lo | | | | | | | -4 026 | -4 026 |
| ss for | | | | | | | | |
| the | | | | | | | | |
| period | | | | | | | | |
--------------------------------------------------------------------------------
| Other | | | | | 554 | 370 | 3 | 927 |
| comprehen | | | | | | | | |
| sive | | | | | | | | |
| income | | | | | | | | |
--------------------------------------------------------------------------------
| Share-bas | | | | | | | 22 | 22 |
| ed | | | | | | | | |
| payments | | | | | | | | |
--------------------------------------------------------------------------------
| Share | | | 9 649 | | | | | 9 649 |
| issue | | | | | | | | |
--------------------------------------------------------------------------------
| Dividend | | | | | | | -474 | -474 |
--------------------------------------------------------------------------------
| Repurchas | | | | -213 | | | | -213 |
| e of own | | | | | | | | |
| shares | | | | | | | | |
--------------------------------------------------------------------------------
| Conveyanc | | | | 51 | | | -1 | 50 |
| e of own | | | | | | | | |
| shares | | | | | | | | |
--------------------------------------------------------------------------------
| Total |11 860 |24 681 | 9 649 | -163 | 437 | -31 | -3 809 | 42 624 |
| equity at | | | | | | | | |
| 30 Sept. | | | | | | | | |
| 2010 | | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| EUR 1 000 | Share | Share | Inves | Own | Transl | Fair | Retain | Total |
| | capit | premi | ted | shar | ation | value | ed | |
| | al | um | non-r | es | differ | reserv | earnin | |
| | | accou | estri | | ences | es | gs | |
| | | nt | cted | | | | | |
| | | | equit | | | | | |
| | | | y | | | | | |
| | | | fund | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Total |11 860 |24 681 | 0 | -50 | -365 | -490 | -246 | 35 390 |
| equity at | | | | | | | | |
| 1 Jan. | | | | | | | | |
| 2009 | | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Profit/lo | | | | | | | 1 208 | 1208 |
| ss for | | | | | | | | |
| the | | | | | | | | |
| period | | | | | | | | |
--------------------------------------------------------------------------------
| Other | | | | | 21 | -227 | -81 | -287 |
| comprehen | | | | | | | | |
| sive | | | | | | | | |
| income | | | | | | | | |
--------------------------------------------------------------------------------
| Share-bas | | | | | | | 51 | 51 |
| ed | | | | | | | | |
| payments | | | | | | | | |
--------------------------------------------------------------------------------
| Conveyanc | | | | 49 | | | -6 | 43 |
| e of own | | | | | | | | |
| shares | | | | | | | | |
--------------------------------------------------------------------------------
| Total |11 860 |24 681 | 0 | -1 | -344 | -717 | 926 | 36 405 |
| equity at | | | | | | | | |
| 30 Sept. | | | | | | | | |
| 2009 | | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| EUR 1 000 | Share | Share | Inves | Own | Transl | Fair | Retain | Total |
| | capit | premi | ted | shar | ation | value | ed | |
| | al | um | non-r | es | differ | reserv | earnin | |
| | | accou | estri | | ences | es | gs | |
| | | nt | cted | | | | | |
| | | | equit | | | | | |
| | | | y | | | | | |
| | | | fund | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Total |11 860 |24 681 | 0 | -50 | -365 | -490 | -246 | 35 390 |
| equity at | | | | | | | | |
| 1 Jan. | | | | | | | | |
| 2009 | | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Profit/lo | | | | | | | 860 | 860 |
| ss for | | | | | | | | |
| the | | | | | | | | |
| period | | | | | | | | |
--------------------------------------------------------------------------------
| Other | | | | | 248 | 89 | -9 | 328 |
| comprehen | | | | | | | | |
| sive | | | | | | | | |
| income | | | | | | | | |
--------------------------------------------------------------------------------
| Share-bas | | | | | | | 68 | 68 |
| ed | | | | | | | | |
| payments | | | | | | | | |
--------------------------------------------------------------------------------
| Conveyanc | | | | 49 | | | -6 | 43 |
| e of own | | | | | | | | |
| shares | | | | | | | | |
--------------------------------------------------------------------------------
| Total |11 860 |24 681 | 0 | -1 | -117 | -401 | 667 | 36 689 |
| equity at | | | | | | | | |
| 31 Dec. | | | | | | | | |
| 2009 | | | | | | | | |
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CASH FLOW STATEMENT
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| EUR 1 000 | 1-9/2010 | 1-9/2009 | 1-12/2009 |
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| Operations | | | |
--------------------------------------------------------------------------------
| Operating profit | -2 166 | 6 100 | 6 706 |
--------------------------------------------------------------------------------
| Total adjustments | 6 783 | 7 984 | 10 367 |
--------------------------------------------------------------------------------
| Cash flow before change in working | 4 617 | 14 085 | 17 073 |
| capital | | | |
--------------------------------------------------------------------------------
| Change in working capital | -2 224 | 15 685 | 15 234 |
--------------------------------------------------------------------------------
| Financial items | -2 394 | -4 596 | -5 263 |
--------------------------------------------------------------------------------
| Taxes paid | -57 | -206 | -251 |
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| Cash flow from operations | -58 | 24 968 | 26 793 |
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| | | | |
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| Investment payments | | | |
--------------------------------------------------------------------------------
| Investments in tangible and | -4 720 | -2 798 | -4 373 |
| intangible assets | | | |
--------------------------------------------------------------------------------
| Proceeds from disposal of fixed | 687 | 218 | 388 |
| assets | | | |
| and other proceeds | | | |
--------------------------------------------------------------------------------
| Cash flow from investing | -4 033 | -2 580 | -3 985 |
| activities | | | |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Financing | | | |
--------------------------------------------------------------------------------
| Non-current loans drawn | 2 000 | 35 192 | 35 192 |
--------------------------------------------------------------------------------
| Repayments of non-current loans | -5 032 | -57 772 | -58 722 |
--------------------------------------------------------------------------------
| Change in commercial papers | 1 986 | | |
--------------------------------------------------------------------------------
| Repayments of capital loans | -2 000 | -2 000 | -2 000 |
--------------------------------------------------------------------------------
| Dividends paid | -474 | | |
--------------------------------------------------------------------------------
| Repurchase and conveyance of own | -163 | 44 | 44 |
| shares | | | |
--------------------------------------------------------------------------------
| Share issue | 9 649 | | |
--------------------------------------------------------------------------------
| Cash flow from financing | 5 966 | -24 536 | -25 486 |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Change in cash and cash | 1 875 | -2 149 | -2 678 |
| equivalents | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| KEY FIGURES | 7-9/2010 | 7-9/2009 | 1-9/2010 | 1-9/2009 |1-12/2009 |
| | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Net sales, change, % | -1.8 | -19.9 | -4.7 | -18.4 | -16.4 |
| * | | | | | |
--------------------------------------------------------------------------------
| Gross profit, % ** | 2.1 | 9.6 | 4.9 | 11.8 | 11.4 |
--------------------------------------------------------------------------------
| Operating profit, % | -4.2 | 2.2 | -1.7 | 4.5 | 3.7 |
| ** | | | | | |
--------------------------------------------------------------------------------
| Financial income and | -2.4 | -3.5 | -2.5 | -3.5 | -3.2 |
| expenses, % ** | | | | | |
--------------------------------------------------------------------------------
| Profit before income | -6.6 | -1.3 | -4.2 | 1.1 | 0.6 |
| taxes, % ** | | | | | |
--------------------------------------------------------------------------------
| Profit for the | -4.9 | -0.8 | -3.1 | 0.9 | 0.5 |
| period, % ** | | | | | |
--------------------------------------------------------------------------------
| Earnings/share, EUR | -0.05 | -0.01 | -0.10 | 0.03 | 0.02 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Equity/share, EUR | | | 0.90 | 1.00 | 1.01 |
--------------------------------------------------------------------------------
| Dividend/share, EUR | | | | | 0.02 |
--------------------------------------------------------------------------------
| Cash flow from | | | 0.00 | 0.69 | 0.74 |
| operations/share, EUR | | | | | |
--------------------------------------------------------------------------------
| Return on equity | | | -13.5 | 4.5 | 2.4 |
| (ROE), % | | | | | |
--------------------------------------------------------------------------------
| Return on invested | | | -2.8 | 7.5 | 6.4 |
| capital (ROI), % | | | | | |
--------------------------------------------------------------------------------
| Equity ratio, % | | | 34.0 | 29.5 | 29.9 |
--------------------------------------------------------------------------------
| Gearing, % | | | 127.8 | 163.4 | 161.2 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Gross investments, | | | 4 605 | 3 000 | 4 507 |
| EUR 1 000 | | | | | |
--------------------------------------------------------------------------------
| Depreciation, EUR 1 | | | 7 134 | 7 626 | 10 158 |
| 000 | | | | | |
--------------------------------------------------------------------------------
* Compared with the corresponding period of the previous year.
** As of net sales.
SEGMENT REPORTING
WIPING
--------------------------------------------------------------------------------
| EUR 1 000 | 1-9/2010 | 1-9/2009 | Change % | 1-12/2009 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Net sales | | | | |
--------------------------------------------------------------------------------
| - Codi Wipes | 42 938 | 47 656 | -9.9 | 64 479 |
--------------------------------------------------------------------------------
| - Nonwovens | 40 925 | 44 406 | -7.8 | 56 905 |
--------------------------------------------------------------------------------
| - eliminations | -4 733 | -6 296 | -24.8 | -7 888 |
--------------------------------------------------------------------------------
| Total | 79 130 | 85 766 | -7.7 | 113 496 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Operating profit | -2 066 | 3 401 | | 4 299 |
--------------------------------------------------------------------------------
| % of net sales | -2.6 | 4.0 | | 3.8 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Assets | 76 793 | 79 106 | | 78 991 |
--------------------------------------------------------------------------------
| Liabilities | 13 445 | 11 257 | | 13 349 |
--------------------------------------------------------------------------------
| Net assets | 63 349 | 67 849 | | 65 641 |
--------------------------------------------------------------------------------
| Investments | 1 943 | 1 691 | | 2 447 |
--------------------------------------------------------------------------------
| Depreciation | 4 748 | 5 152 | | 6 784 |
--------------------------------------------------------------------------------
| Average personnel | 375 | 390 | | 392 |
--------------------------------------------------------------------------------
FLEXIBLES
--------------------------------------------------------------------------------
| EUR 1 000 | 1-9/2010 | 1-9/2009 | Change % | 1-12/2009 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Net sales | 49 627 | 49 531 | 0.2 | 66 894 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Operating profit | 18 | 3 136 | | 2 823 |
--------------------------------------------------------------------------------
| % of net sales | 0.0 | 6.3 | | 4.2 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Assets | 47 453 | 44 203 | | 44 462 |
--------------------------------------------------------------------------------
| Liabilities | 11 188 | 8 663 | | 10 039 |
--------------------------------------------------------------------------------
| Net assets | 36 265 | 35 540 | | 34 423 |
--------------------------------------------------------------------------------
| Investments | 2 620 | 1 309 | | 2 059 |
--------------------------------------------------------------------------------
| Depreciation | 2 368 | 2 420 | | 3 349 |
--------------------------------------------------------------------------------
| Average personnel | 527 | 540 | | 541 |
--------------------------------------------------------------------------------
NON-ALLOCATED ITEMS
--------------------------------------------------------------------------------
| EUR 1 000 | 1-9/2010 | 1-9/2009 | 1-12/2009 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Net sales | -634 | -798 | -1 036 |
--------------------------------------------------------------------------------
| Operating profit | -118 | -437 | -415 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Assets | 1 173 | 105 | -623 |
--------------------------------------------------------------------------------
| Liabilities | 58 162 | 67 090 | 62 752 |
--------------------------------------------------------------------------------
| Investments | 42 | | 1 |
--------------------------------------------------------------------------------
| Depreciation | 18 | 53 | 24 |
--------------------------------------------------------------------------------
| Average personnel | 11 | 11 | 11 |
--------------------------------------------------------------------------------
NET SALES BY MARKET AREA
--------------------------------------------------------------------------------
| EUR 1 000 | 1-9/2010 | 1-9/2009 | 1-12/2009 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Finland | 20 094 | 22 852 | 29 883 |
--------------------------------------------------------------------------------
| Scandinavia | 11 266 | 11 838 | 15 843 |
--------------------------------------------------------------------------------
| The Netherlands | 6 380 | 9 596 | 12 004 |
--------------------------------------------------------------------------------
| Other Europe | 81 502 | 77 584 | 106 220 |
--------------------------------------------------------------------------------
| Other countries | 8 881 | 12 630 | 15 404 |
--------------------------------------------------------------------------------
| Net sales, total | 128 123 | 134 499 | 179 354 |
--------------------------------------------------------------------------------
QUARTERLY FIGURES
--------------------------------------------------------------------------------
| EUR 1 000 | IV/2009 | I/2010 | II/2010 | III/2010 | IV/2009- |
| | | | | | III/2010 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| NET SALES | | | | | |
--------------------------------------------------------------------------------
| Wiping | | | | | |
--------------------------------------------------------------------------------
| - Codi Wipes | 16 824 | 13 884 | 14 844 | 14 210 | 59 762 |
--------------------------------------------------------------------------------
| - Nonwovens | 12 499 | 12 246 | 13 722 | 14 958 | 53 424 |
--------------------------------------------------------------------------------
| - eliminations | -1 592 | -1 667 | -1 333 | -1 734 | -6 326 |
--------------------------------------------------------------------------------
| Total | 27 730 | 24 462 | 27 234 | 27 434 | 106 860 |
--------------------------------------------------------------------------------
| Flexibles | 17 363 | 16 395 | 17 107 | 16 125 | 66 990 |
--------------------------------------------------------------------------------
| Non-allocated items | -238 | -241 | -193 | -200 | -872 |
--------------------------------------------------------------------------------
| Net sales, total | 44 855 | 40 616 | 44 148 | 43 359 | 172 978 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| OPERATING PROFIT | | | | | |
--------------------------------------------------------------------------------
| Wiping | 898 | -142 | -787 | -1 136 | -1 168 |
--------------------------------------------------------------------------------
| % of net sales | 3.2 | -0.6 | -2.9 | -4.1 | -1.1 |
--------------------------------------------------------------------------------
| Flexibles | 275 | -135 | 873 | -720 | 293 |
--------------------------------------------------------------------------------
| % of net sales | 1.6 | -0.8 | 5.1 | -4.5 | 0.4 |
--------------------------------------------------------------------------------
| Non-allocated items | 21 | -48 | -103 | 33 | -96 |
--------------------------------------------------------------------------------
| Operating profit | 1 195 | -325 | -17 | -1 824 | -971 |
| before non-recurring | | | | | |
| costs | | | | | |
--------------------------------------------------------------------------------
| % of net sales | 2.7 | -0.8 | 0.0 | -4.2 | -0.6 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Non-recurring costs | -589 | | | | -589 |
--------------------------------------------------------------------------------
| Operating profit, | 606 | -325 | -17 | -1 824 | -1 560 |
| total | | | | | |
--------------------------------------------------------------------------------
| % of net sales | 1.4 | -0.8 | 0.0 | -4.2 | -0.9 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| NET FINANCIAL EXPENSES | -1 045 | -1 138 | -988 | -1 028 | -4 198 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| PROFIT BEFORE INCOME | -439 | -1 463 | -1 005 | -2 852 | -5 758 |
| TAXES | | | | | |
--------------------------------------------------------------------------------
TAXES FOR THE PERIOD UNDER REVIEW
Income tax expense is recognised based on the estimated average income tax rate
for the full financial year.
INFORMATION ON RELATED PARTIES
Suominen has related party relationships with the members of the Board of
Directors, and the members of the Corporate Executive Team. The company has no
investments in associated companies. Salaries paid to the related parties
amounted to EUR 827 thousand, share-based payments EUR 22 thousand, unsecured
loans EUR 660 thousand, and interest payments EUR 102 thousand.
MOVEMENTS IN BORROWINGS
--------------------------------------------------------------------------------
| EUR 1 000 | 1-9/2010 | 1-9/2009 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Total borrowings on 1 January | 60 861 | 86 403 |
--------------------------------------------------------------------------------
| | | |
--------------------------------------------------------------------------------
| Commercial papers on 1 January | | |
--------------------------------------------------------------------------------
| Change in commercial papers | 1 986 | |
--------------------------------------------------------------------------------
| Commercial papers on 30 September | 1 986 | 0 |
--------------------------------------------------------------------------------
| | | |
--------------------------------------------------------------------------------
| Non-current loans on 1 January | 52 861 | 76 403 |
--------------------------------------------------------------------------------
| Change in non-current loans | -2 874 | -22 716 |
--------------------------------------------------------------------------------
| Non-current loans on 30 September | 49 987 | 53 687 |
--------------------------------------------------------------------------------
| | | |
--------------------------------------------------------------------------------
| Capital loans on 1 January | 8 000 | 10 000 |
--------------------------------------------------------------------------------
| Change in capital loans | -2 000 | -2 000 |
--------------------------------------------------------------------------------
| Capital loans on 30 September | 6 000 | 8 000 |
--------------------------------------------------------------------------------
| | | |
--------------------------------------------------------------------------------
| Total borrowings on 30 September | 57 973 | 61 687 |
--------------------------------------------------------------------------------
CHANGES IN FIXED ASSETS
--------------------------------------------------------------------------------
| EUR 1 000 | 1-9/ | | 1-9/ | | 1-12/ | |
| | 2010 | | 2009 | | 2009 | |
--------------------------------------------------------------------------------
| | Tangibl | Intangi | Tangibl | Intangi | Tangibl | Intangi- |
| | e | -ble | e | -ble | e | ble |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Book value at | 57 044 | 795 | 62 661 | 855 | 62 661 | 855 |
| the beginning | | | | | | |
| of the period | | | | | | |
--------------------------------------------------------------------------------
| Investments | 4 389 | 87 | 2 929 | 18 | 4 311 | 143 |
--------------------------------------------------------------------------------
| Decreases | -302 | -2 | -151 | | -161 | |
--------------------------------------------------------------------------------
| Depreciation | -6 988 | -146 | -7 472 | -154 | -9 955 | -203 |
| and impairment | | | | | | |
--------------------------------------------------------------------------------
| Translation | 564 | | -186 | -1 | 188 | |
| differences and | | | | | | |
| other changes | | | | | | |
--------------------------------------------------------------------------------
| Book value at | 54 707 | 734 | 57 781 | 718 | 57 044 | 795 |
| the end of the | | | | | | |
| period | | | | | | |
--------------------------------------------------------------------------------
CONTINGENT LIABILITIES
--------------------------------------------------------------------------------
| EUR 1 000 | 9/2010 | 9/2009 | 12/2009 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| FOR OWN DEBT | | | |
--------------------------------------------------------------------------------
| Real estate mortgages | 24 045 | 24 045 | 24 045 |
--------------------------------------------------------------------------------
| Corporate mortgages | 50 000 | 50 000 | 50 000 |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| OTHER OWN COMMITMENTS | | | |
--------------------------------------------------------------------------------
| Leasing rents and commitments | 9 138 | 11 016 | 9 878 |
--------------------------------------------------------------------------------
| Rental liabilities | 8 877 | 9 238 | 8 494 |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| GUARANTEE COMMITMENTS | 1 825 | 1 515 | 1 752 |
--------------------------------------------------------------------------------
NOMINAL AND FAIR VALUES OF DERIVATIVE FINANCIAL INSTRUMENTS
--------------------------------------------------------------------------------
| EUR 1 000 | 9/2010 | 9/2009 | 12/2009 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| CURRENCY DERIVATIVES | | | |
--------------------------------------------------------------------------------
| Nominal value | 5 568 | 5 584 | 5 637 |
--------------------------------------------------------------------------------
| Fair value | -176 | -19 | -27 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| INTEREST RATE DERIVATIVES | | | |
--------------------------------------------------------------------------------
| Nominal value | 14 500 | 33 500 | 25 833 |
--------------------------------------------------------------------------------
| Fair value | -223 | -621 | -448 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| ELECTRICITY DERIVATIVES | | | |
--------------------------------------------------------------------------------
| Nominal value | 2 962 | 1 826 | 1 292 |
--------------------------------------------------------------------------------
| Fair value | 158 | -464 | -120 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| COMMODITY DERIVATIVES | | | |
--------------------------------------------------------------------------------
| Nominal value | | 1 742 | 435 |
--------------------------------------------------------------------------------
| Fair value | | -14 | 48 |
--------------------------------------------------------------------------------
Helsinki, 22 October 2010
SUOMINEN CORPORATION
Board of Directors
For addition information please contact:
Mr. Petri Rolig, President and CEO, tel. +358 (0)10 214 300
Mr. Arto Kiiskinen, Vice President and CFO, tel. +358 (0)10 214 300
interim-22-10-2010.pdf
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