Investor Relations |
|
|
November-April in brief (November 1, 2005 - April 30, 2006)
- Net sales totaled EUR 49.1 million (EUR 35.3 million). The growth compared with the corresponding period in the previous fiscal year was 39.3%. - Operating profit was EUR 0.4 million (EUR –2.5 million) - Profit before taxes was EUR 0.9 million (EUR –2.7 million). - Net profit was EUR –1.5 million (EUR –3.0 million). - Earnings per share amounted to EUR -0.04 (EUR –0.07). - Return on investment (ROI) was 5.7% (-24.9%). - Return on equity (ROE) was –7.9% (-30.6%). - Solvency ratio was 64.1% (65.8%). - Cash flow from business operations was EUR –6.5 million (EUR 0.3 million). - Gearing was –29.7% (-39.3%). Interest-bearing cash reserves exceeded interest-bearing liabilities by EUR 10.9 million. February-April in brief (February 1, – April 30, 2006) - Net sales totaled EUR 27.0 million (16.2 million) The growth compared with the corresponding period in the previous fiscal year was 66.7%. - Operating profit was EUR 1.3 million (EUR –3.6 million) - Profit before taxes was EUR 1.7 million (EUR –3.7 million). - Net profit was EUR –0.5 million (EUR -4.3 million) - The net profit was adversely affected by a combined non-recurring adjustment of EUR 1.9 million to an avoir-fiscal receivable previously recorded as a non- recurring expense and to tax deferred tax assets in the books of Efore (USA) Inc. NET SALES AND FINANCIAL PERFORMANCE NOVEMBER-APRIL Net sales for November-April went up to EUR 49.1 million (EUR 35.3 million), the growth compared with the corresponding period in the previous fiscal period being 39.3 per cent. The growth in net sales for the period under review accrued principally from the increase in deliveries of power supply solutions for mobile phone networks, fixed telecommunications networks and industrial electronics. Sales by customer segment were as follows: telecommunications 70.9% (68.3%), industrial electronics 24.5% (25.4%) and health-care electronics 4.6% (6.3%). Geographically sales were as follows: EMEA EUR 29.8 million (EUR 23.2 million), the Americas EUR 14.0 million (EUR 9.5 million) and APAC EUR 5.3 million (EUR 2.6 million). The operating profit for November-April was EUR 0.4 million (EUR –2,5 million). The net profit for the period was affected by planned restructuring related to production and modifications to products as required by the RoHS Directive. The profit before taxes for November - April was EUR 0.9 million (EUR –2.7 million) and the net profit was EUR -1.5 million (EUR –3.0 million). NET SALES AND FINANCIAL PERFORMANCE FEBRUARY-APRIL Net sales in the second quarter developed favorably and went up to EUR 27.0 million (16.2 million). The growth compared with the corresponding quarter in the previous fiscal period was 66.7%. The growth accumulated in particular from the increase in deliveries of power supply solutions for mobile phone networks and fixed telecommunication systems especially to EMEA market. Correspondingly, sales to the American market showed a clear fall. Sales by customer segment were: telecommunications 73.9% (61.6%), industrial electronics 21.4% (29.7%) and health-care electronics 4.7% (8.7%). Geographically sales were as follows: EMEA EUR 18.7 million (EUR 4.6 million), the Americas EUR 5.6 million (EUR 10.6 million) and APAC EUR 2.7 million (EUR 1.0 million). With the sales growth profitability for the second quarter developed favorably, even though it was affected by planned production-restructuring expenses and write-downs of non-marketable materials that resulted from product modifications in line with the RoHS Directive. The operating profit for the second quarter was EUR 1.3 million (EUR –3.6 million) Profit before taxes in the second quarter was EUR 1.7 million (EUR -3.7 million). Profit was improved by the good performance of the associated company Power Innovation GmbH, which had a positive effect of EUR 0.1 million on the profit. The financial expenses were adversely affected by an increase a write- back of EUR 0.3 million of a write-down on the shares and loan receivables of the associated company Power Innovation GmbH. The net profit was EUR –0.5 million (EUR -4.3 million). The net profit was adversely affected by an adjustment of EUR 1.9 million to an avoir-fiscal receivable previously recorded as a non-recurring expense and to deferred tax assets entered in the books of Efore (USA) Inc. BUSINESS OPERATIONS During the period under review new product development projects were launched, in particular with customers in the telecommunications sector. Efore's market position in delivering power-supplies for wireless telecommunications networks was strengthened. According to the most recent market research, Efore is the fifth largest player in the above-mentioned field. Product development operations were focused mainly on the design of custom- designed power supplies. Most of the products are connected with new product families for 2,5G and 3G base stations, other wireless telecommunications networks (e.g. WiMax), fixed telecommunications networks, and new-technology broadband networks (e.g. Triple-Play). In addition, product development inputs were focused on DC power systems and various short-term reserve power systems and the development of new power-supply technology platforms. A number of custom-designed health-care equipment-related development projects are also under way. During the period under review, new products and technology solutions to the value of EUR 2.6 million (EUR 2.5 million) were developed. The number of personnel working in product development and in functions assisting product development stood at 92 at the end of the review period. INVESTMENT During the period under review, investment in fixed assets amounted to EUR 2.4 million (EUR 2.8 million), EUR 0.7 million (EUR 1.1 million) of which was accounted for by capitalization of product development. The investment in equipment for increasing the company's own production particularly in Estonia and China contributed to the growth in investment. The aim in the next few years is still for investment not to exceed planned depreciation. FINANCIAL POSITION The Group's financial position during the period under review was good. The Group's solvency rate at the end of the period was 64.1% (65.8%) and the gearing was –29.7% (-39.3%). Consolidated net interest-bearing liabilities amounted to EUR -10.9 million (EUR –14.0 million), i.e. the consolidated interest-bearing cash reserves exceed interest-bearing cash liabilities by EUR 10.9 million. The consolidated net financing incomes were EUR 0.4 million (-0.2 million). In addition, financial costs were reduced by the write-back of a write-down of EUR 0.3 million recorded in the previous fiscal period on the shares and loan receivables of Power Innovation GmbH. The cash flow from business operations was EUR -6.5 million (EUR 0.3 million) and the change in cash flow showed a decrease of EUR 9.1 million (EUR 7.6 million decrease). The cash flow after investments was EUR -9.0 million (EUR -2.6 million). Liquid assets excluding undrawn credit facilities totaled EUR 12.7 million (EUR 16.4 million) at the end of the period under review. The balance sheet total was EUR 57.2 million (EUR 54.2 million). The consolidated working capital was equivalent to 15.5% (13.4%) of net sales in the preceding 12-month period. The Group's aim is to ensure that this percentage remains below 10%. TAXATION During the period under review a deferred tax asset of EUR 1.3 million was adjusted and recorded under taxes. This item is related to Efore (USA) Inc.'s unused taxation losses from previous years, the utilization of which in the future is uncertain. An amount of EUR 0.6 million previously taken into account as an avoir-fiscal receivable has been entered under taxes for the fiscal period. The entries do not affect the cash flow. The consolidated profit and loss statement also includes a change of EUR 0.1 million in other deferred tax assets and liabilities as an expense included under income taxes. In other respects taxes corresponding to Group companies' profit for the period under review have been taken into account under taxes. However, the deferred tax asset relating to losses has not been taken into account. PERSONNEL The number of Group personnel averaged 776 (616) during the period under review and at the end of the period was 821 (648). The number of personnel increased by 120 during the period. In addition to its own personnel, the Group's contract staff numbered 268 at the end of the period, an increase of 50 during the period. The geographical distribution of Efore's personnel including contract staff at the end of the period was as follows: Europe 535 (391), the Americas 104 (145) and Asia 450 (254). IAS/IFRS REPORTING Efore transferred to financial reporting in accordance with the International Financial Reporting Standards (IFRS) in the beginning of fiscal year 2006. The comparison data used for this report are IFRS-compatible figures for 2005, published on February 27, 2006. The calculation principles for the interim report are the same as in the release published on February 27, 2006, which can be found on the Efore website at www.efore.fi (under 'releases'). GROUP STRUCTURE Efore Group consists of the parent company Efore Plc and its wholly owned subsidiaries Efore (UK) Ltd, Efore (USA) Inc., Efore (Suzhou) Electronics Co. Ltd, Efore (SIP) Technologies Co. Ltd. Efore Ltda, and Efore AS and FI-Systems Oy. Efore Plc also has a 25% holding in the German power electronics company Power Innovation GmbH. CHANGES IN GROUP MANAGEMENT AND ORGANIZATION Scott Vartija was appointed Executive Vice President, Marketing and Sales, Americas, and a member of the Efore Senior Executive Committee with effect from February 20, 2006. The Group's organization model and the management's reporting responsibilities were altered on March 15, 2006 so that technology development, product development, manufacturing operations, and supply management and sourcing were converted into global functions managed at Group level. In the same connection Markku Kukkonen was made a new appointment to the Senior Executive Committee. BOARD AUTHORIZATIONS The Annual General Meeting decided on January 25, 2006 that the Board of Directors be authorized to increase the share capital by a maximum of EUR 6,890,039.65 i.e. 8,105,929 new shares with an equivalent book value of EUR 0.85. The authorization is valid until the next Annual General Meeting, however, no longer than one year from the decision of the Annual General Meeting, and it contains the right to disapply the pre-emptive rights on condition that the Company has sound financial grounds for doing so. NOTIFICATION OF A CHANGE IN HOLDING Efore Plc has given notification of a change in holding in accordance with chapter 2, section 9 of the Securities Markets Act. The holdings of OP Bank Group Central Cooperative, its subsidiaries and the mutual funds managed by its subsidiaries have fallen below 5% of the share capital and voting rights in Efore Plc. SHARES AND SHAREHOLDERS The total number of Efore Plc shares at the end of the period under review was 40,529,648 and the registered share capital was EUR 34,450,200.80. The highest share price during the period was EUR 2.06 and the lowest price was EUR 1.72. The average price during the period was EUR 1.91 and the closing price was EUR 2.02. The market capitalization calculated at the final trading price was EUR 81.9 million. The total number of Efore shares traded on the Helsinki Stock Exchange during the period was 16.8 million and their turnover value was EUR 31.9 million. This accounted for 41.4% of the total number of shares at the end of the period. The number of shareholders totalled 4,232 at the end of the period. EVENTS AFTER PERIOD UNDER REVIEW The Annual General Meeting held on January 25, 2006 decided to decrease the share premium by EUR 3,971,543.60 by transferring the decreased amount to company's non-restricted equity. The National Board of Patents and Registration of Finland has, on June 2, 2006 granted the company permission to execute the decided decrease of the share premium. At a meeting held on June 7, 2006 the Efore Plc Board of Directors elected Reijo Mäihäniemi President and CEO of Efore Plc. Mr Mäihäniemi will take on the duties of President and CEO as from today. At the same time he has resigned from the Efore Board and from the membership of Board committees as from June 8, 2006. He succeeds Markku Hangasjärvi, who resigns from the service of Efore Plc at his own request. Mr Hangasjärvi will continue to carry out special duties for the Efore Board of Directors up to December 7, 2006. OUTLOOK The telecommunications networks market, which is the most important market for Efore's net sales growth, is expected to continue growing at a moderate rate, measured by its value in euros, during 2006. Growth is also expected in wireless networks and fixed communications systems. As a result of the reasonably favourable market outlook for the telecommunications sector and Efore's new customers and products, the net sales for the current fiscal year (12 months) are expected to be clearly up on the previous fiscal year's figures. With the sales growth and transfers of production that are under way the operating profit and earnings per share for the fiscal period are expected to be up on the previous fiscal year's figures. CONSOLIDATED PROFIT AND LOSS STATEMENT EUR million Feb./06- Feb./05- Nov./05- Nov./04- Nov./04- Apr./06 Apr./05 Apr./06 Apr./05 Oct./05 3 months 3 months 6 months 6 months 12 months Net sales 27,0 16,2 49,1 35,3 81,6 Changes in inventories of finished goods and work in progress -0,5 -0,5 -0,5 -0,4 -0,1 Other operating income 0,1 0,1 0,2 0,1 0,2 Other operating expenses -24,5 -18,5 -46,7 -36,0 -79,4 Depreciation -0,9 -0,7 -1,7 -1,3 -2,8 Impairment 0,0 -0,1 0,0 -0,2 -0,4 OPERATING PROFIT (-LOSS) 1,3 -3,6 0,4 -2,5 -0,8 % net sales 4,8 -22,2 0,9 -7,1 -1,0 Financing income and expenses 0,3 -0,1 0,4 -0,2 0,4 Share of loss of associated companies 0,1 0,0 0,1 0,0 0,0 PROFIT (-LOSS) BEFORE TAX 1,7 -3,7 0,9 -2,7 -0,4 % net sales 6,2 -23,0 1,8 -7,8 -0,5 Tax on income from operations -2,2 -0,5 -2,4 -0,3 -1,0 PROFIT (-LOSS) FOR THE PERIOD -0,5 -4,3 -1,5 -3,0 -1,5 Earnings per share,eur -0,01 -0,11 -0,04 -0,07 -0,04 Earnings per share, diluted, eur -0,01 -0,11 -0,04 -0,07 -0,04 NET SALES BY SECONDARY SEGMENTS, Feb./06- Feb./05- Nov./05- Nov./04- Nov./04- EUR million Apr./06 Apr./05 Apr./06 Apr./05 Oct./05 3 months 3 months 6 months 6 months 12 months Americas 5,6 10,6 14,0 9,5 24,8 EMEA 18,7 4,6 29,8 23,2 50,5 APAC 2,7 1,0 5,3 2,6 6,3 TOTAL 27,0 16,2 49,1 35,3 81,6 CONSOLIDATED BALANCE SHEET EUR million Apr. 30, Apr. 30, change Oct. 31, 2006 2005 % 2005 ASSETS NON-CURRENT ASSETS Intangible assets 4,6 4,0 15,7 4,4 Tangible assets 9,1 7,5 22,5 8,6 Investments in associates 0,2 0,0 n.a. 0,0 Long-term receivables and investments 0,4 1,9 -77,7 1,8 NON-CURRENT ASSETS 14,4 13,4 7,4 14,8 CURRENT ASSETS Inventories 13,2 12,1 9,0 13,2 Trade receivables and other receivables 17,0 12,4 37,4 10,2 Cash equivalents 8,6 12,0 -28,1 11,5 Cash in hand and at banks 4,1 4,4 -7,8 10,3 CURRENT ASSETS 42,9 40,9 4,9 45,2 ASSETS 57,2 54,2 5,6 59,9 EQUITY AND LIABILITEIS SHAREHOLDERS' EQUITY Share capital 34,5 34,5 0,0 34,5 Share premium account and other reserves 5,0 4,3 17,8 4,7 Retairned earnigs -2,8 -3,1 -8,8 -1,0 SHAREHOLDERS' EQUITY 36,7 35,7 2,9 38,2 LIABILITIES Long-term liabilities 0,5 1,1 -58,0 0,8 Current liabilities 20,1 17,5 14,9 20,9 LIABILITIES 20,6 18,6 10,7 21,7 TOTAL EQUITY AND LIABILITIES 57,2 54,2 5,6 59,9 GROUP KEY FIGURES, EUR million Feb./06- Feb./05- Nov./05- Nov./04- Nov./04- Apr./06 Apr./05 Apr./06 Apr./05 Oct./05 3 months 3 months 6 months 6 months 12 months Earnings per share,eur -0,01 -0,11 -0,04 -0,07 -0,04 Earnings per share, diluted, eur -0,01 -0,11 -0,04 -0,07 -0,04 Shareholders' equity per share, 0,91 0,88 0,91 0,88 0,94 eur Solvency ratio,% 64,1 65,8 64,1 65,8 63,7 Return on equity-%(ROE) -5,7 -32,0 -7,9 -30,6 -14,4 Return on investment-%(ROI) 18,3 -26,0 5,7 -24,9 -1,1 Gearing, % -29,7 -39,3 -29,7 -39,3 -52,2 Net interest-bearing debt, EUR -10,9 -14,0 -10,9 -14,0 -19,9 million Gross investments, Me 1,1 1,3 2,4 2,8 5,6 as percentage of net sales 3,8 3,8 4,8 7,8 6,8 Average personnel 800 644 776 616 668 CASH FLOW STATEMENT Nov./05- Nov./04- change Nov./04- EUR million Apr./06 Apr./05 % Oct./05 Cash flow from business operations before financing items and taxes -6,4 0,9 8,1 Financing items and taxes -0,1 -0,6 0,5 Cash flow from business operations (A) -6,5 0,3 -2 147,9 8,7 Investments -2,5 -2,9 -5,9 Cash flow from investments (B) -2,5 -2,9 -13,0 -5,9 Directed share issue and subscription 0,0 1,0 1,0 of shares with warrants Change in liabilities 0,0 0,0 -0,3 Dividends paid 0,0 -6,0 -6,0 Cash flow from financing (C) 0,0 -4,9 99,2 -5,3 Change in cash flow (A+B+C), increase (+), decrease (-) -9,1 -7,6 -20,3 -2,5 GROUP CONTINGENT LIABILITIES Apr. 30, Apr. 30, change Oct. 31, Contingent liabilities, EUR million 2006 2005 % 2005 On own behalf - Corporate mortages 0,0 2,9 -100,0 0,0 - Pledges given 0,0 0,1 -78,5 0,1 - Other contingent liabilities 0,2 0,2 0,0 0,2 - Rent and leasing commitments 6,7 5,8 16,0 7,4 Derivative contracts -Forward currency contracts Market value 0,5 1,6 -70,5 1,9 Value of underlying Instruments 0,5 1,6 -70,1 1,9 Percentage changes calculated on basis of exact figures. GROUP STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY EUR million Share- Share Other Translation Retained holders' premium reserves differences earnings Total equity account Shareholders' equity 34,5 4,0 0,7 0,2 -1,2 38,2 Nov.1, 2005 Change in translation 0,0 0,0 0,0 0,0 -0,1 -0,1 defference Other changes 0,0 0,0 0,1 0,0 0,0 0,1 Loss for the period 0,0 0,0 0,0 0,0 -1,5 -1,5 Shareholders' equity 34,5 4,0 0,8 0,2 -2,8 36,7 Apr. 30, 2006 EUR million Share- Share Other Translation Retained holders' premium reserves differences earnings Total equity account Shareholders' equity 17,1 20,1 0,3 0,0 5,9 43,4 Nov.1, 2004 Change in translation 0,0 0,0 0,0 0,0 0,0 0,0 defference Annulment of shares -0,2 0,2 0,0 0,0 0,0 0,0 Profit for the period 0,0 0,0 0,0 0,0 -3,0 -3,0 Dividend 0,0 0,0 0,0 0,0 -6,0 -6,0 Bonus issue 17,0 -17,0 0,0 0,0 0,0 0,0 Exercised options 0,6 0,7 0,0 0,0 0,0 1,2 Shareholders' equity 34,5 4,0 0,3 0,0 -3,1 35,7 Apr. 30, 2005 EFORE PLC Board of Directors Additional information is available from President and CEO Reijo Mäihäniemi, tel. + 358 9 4784 6312. Efore Plc will hold a news conference regarding the interim report for analysts and media on June 8, 2006 at 11 a.m in Helsinki World Trade Center, Marski Conference Room, address Aleksanterinkatu 17. DISTRIBUTION Helsinki Stock Exchange Principal media Efore Group The Efore electronics group is an international company providing services for the telecommunications, industrial electronics and health-care industries. Its operations comprise custom-designed power supplies, DC power systems, electronics design and manufacturing services (EDMS) and maintenance and repair services. Efore's registered office is in Espoo, Finland. The company also has operations elsewhere in Finland, in Saarijärvi and Tampere. Efore's other product development and production units are located in China, Estonia and the USA. The Group also a subsidiary in Brazil and an associate company in Germany. In the fiscal year ending in October 2005, consolidated net sales totaled approximately EUR 81.8 million and the Group's personnel numbered 751. The parent company Efore Plc is quoted on the Main List of the Helsinki Stock Exchange. |