Report Publication Announcement • Dec 22, 2014
Report Publication Announcement
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Harboes Bryggeri A/S CVR no.: 43 91 05 15 Tel. +45 58 16 88 88 www.harboe.com
Contacts: Bernhard Griese, CEO Ruth Schade, CFO
For the period 1 May - 31 October 2014
To
NASDAQ OMX Copenhagen
The Board of Directors of Harboes Bryggeri A/S has today considered and adopted the interim report for the period 1 May - 31 October 2014
The report is described on the following pages.
Skælskør, 17 December 2014
Anders Nielsen Bernhard Griese Chairman of the Board CEO
"It is encouraging to see that our international strategy of focusing on our own brands is working as intended with increased sales and improved earnings margins. On the Northern European markets, we are still challenged by fierce competition and pressure on prices, but we are able to maintain our well-established position and continuously strive to optimise our business and partnership with our customers to minimise our sensitivity to fluctuations and competition as much as possible. At the same time, we are really seeing the benefits of the past years' investments in energy optimisation and efficiency measures, ensuring considerable operational savings. We therefore revise our outlook upwards for the full year.
We remain in certain parts of the Group's geographical markets challenged by difficult conditions under which dampens growth, and we also expect H2 to present significant challenges. But we continue our efforts in our strategic focus areas and expect them all to make a positive contribution to results in 2014/2015."
Bernhard Griese CEO
Strengthened earnings driven by own brands and continued streamlining
Further information Bernhard Griese, CEO Tel.: +45 58 16 88 88
| GROUP | Q2 | Q2 | H1 | H1 | FY |
|---|---|---|---|---|---|
| (DKK '000) | 2014/2015 | 2013/2014 | 2014/2015 | 2013/2014 | 2013/2014 |
| Sales (million hectolitres) | |||||
| Beer, soft drinks and malt wort products | 1.39 | 1.60 | 2.99 | 3.02 | 5.93 |
| Earnings | |||||
| Gross revenue | 388,824 | 419,476 | 830,671 | 886,612 | 1,626,919 |
| Taxes on beer and soft drinks | (47,036) | (60,952) | (96,824) | (135,071) | (206,807) |
| Revenue | 341,788 | 358,524 | 733,847 | 751,541 | 1,420,112 |
| EBITDA | 32,393 | 30,537 | 71,958 | 63,419 | 106,617 |
| Operating profit/(loss) | 10,359 | 8,099 | 27,434 | 18,797 | 16,695 |
| Profit/(loss) before tax | 9,093 | 6,635 | 24,977 | 16,088 | 10,403 |
| Net profit/(loss) for the period | 6,377 | 4,253 | 18,242 | 11,782 | 10,591 |
| Balance sheet | |||||
| Non-current assets | 809,137 | 1,011,230 | 830,524 | ||
| Current assets | 565,827 | 440,936 | 553,192 | ||
| Equity | 714,123 | 773,356 | 706,558 | ||
| Non-current liabilities | 298,171 | 322,908 | 310,886 | ||
| Current liabilities | 362,670 | 355,902 | 366,272 | ||
| Balance sheet total | 1,374,964 | 1,452,166 | 1,383,716 | ||
| Net interest-bearing debt | 202,920 | 108,919 | 196,786 | ||
| Investments etc. | |||||
| Investments in intangible assets | 215 | 432 | 510 | 1,549 | 2,394 |
| Investments in property, plant and equipment | 18,511 | 5,094 | 33,717 | 9,690 | 34,116 |
| Depreciation, amortisation, impairment losses and write-downs | 22,234 | 22,438 | 44,524 | 44,622 | 89,922 |
| Cash flows | |||||
| Cash flows from operating activities | 42,294 | 10,095 | 27,803 | 35,453 | 46,598 |
| Cash flows from investing activities | (13,002) | (4,931) | (23,990) | (10,905) | (125,447) |
| Cash flows from financing activities | (13,320) | (22,457) | (16,855) | (26,027) | (98,891) |
| Change in cash and cash equivalents (free cash flow) | 15,972 | (17,293) | (13,042) | (1,479) | 73,154 |
| Ratios (in %) | |||||
| Profit margin | 3.7% | 2.5% | 1.2% | ||
| Solvency ratio | 51.9% | 53.3% | 51.1% | ||
| EBITDA margin | 9.8% | 8.4% | 7.5% | ||
| Gearing | 28.4% | 14.1% | 27.9% |
Harboes Bryggeri A/S is listed on the stock exchange and is the parent of the Harboe group.
The group's core business is the production and sale of beer, soft drinks, malt beverages and malt wort products.
Total sales of beer and soft drinks, including malt beverages and malt wort products, totalled 1.39 million hectolitres in Q2 against 1.45 million hectolitres in the same period last year.
Sales amounted to 2.99 million hectolitres in H1, a slight fall of 1.0%.
Revenue was DKK 341.8 million in Q2 2014/15 against DKK 358.5 million in the same period last year, down 4.7%.
Revenue forH1 amounted toDKK 733.8million againstDKK 751.5million in the same period last year, corresponding to a fall of 2.4%.
The development reflects a positive trend in a number of important markets, but is offset by continued challenges in several of the group's international markets, which are affected by conflicts, political unrest and other challenging market conditions. As part of the continued optimisation of the contract portfolio, Harboe has also replaced large volumes with new customer agreements, where the volume is lower, yet the product mix is more attractive and margins better.
Read more about developments in the business units in the relevant sections in this report.
Aprofit before depreciation, amortisation, net financials and tax (EBITDA) of DKK 32.4 million was returned in Q2 against DKK 30.5 million in the same period last year, representing an increase of 6.1% and an EBITDA margin of 9.5%.
The improved earnings are, among other things, attributable to the recent years' investments in increased efficiency across the entire value chain as well as energy optimisations in production, which are now beginning to have a positive effect on costs. The group's activities in a number of international markets are developing positively with increasing sales of the group's own brands, ensuring more attractive earnings margins.
Depreciation, amortisation, impairment losses and write-downs totalled DKK 22.2 million in Q2 againstDKK 22.4 million in the same period last year. In H1, depreciation, amortisation, impairment losses and write-downs amounted to DKK 44.5 million against DKK 44.6 million in the same period last year.
The operating profitfor Q2 amounted toDKK 10.4million, up 27.9%relative to the same period last year. An operating profit of DKK 27.4 million was returned for H1 against DKK 18.8 million in the same period last year.
Net financialswere negative atDKK 1.3million in Q2 againstDKK 1.5million
in the same period last year. In H1, net financials were negative at DKK 2.5 million against DKK 2.7 million in the same period last year. [Explanation of the development]
The profit before tax amounted to DKK 9.1 million in Q2 against DKK 6.6 million in the same period last year. A profit before tax of DKK 25.0 million was returned for H1 against DKK 16.1 million in the same period last year.
A net profit of DKK 6.4 million was realised in Q2 against DKK 4.3 million in the same period last year. A net profit of DKK 18.2 million was returned for H1 against DKK 11.8 million in the same period last year.
Harboe produces and sells a wide range of beverages and malt extract products in more than 90 markets worldwide. The product portfolio is designed to meet the demand and market potential of the individual markets and is based on three strategic business units: Harboe Nordic, Harboe International and Harboe Ingredients.
Harboe Nordic, which is the group's largest business unit, markets a wide range of beers, soft drinks, energy drinks and non-alcoholic malt beverages in Harboe's main markets in Denmark, Norway, Sweden, the Baltic states, Germany as well as the Danish-German border area. Harboe's strategy is to focus on maintaining a high volume and protecting its well-established position in these markets by providing customers with a high level of quality, flexibility and reliable deliveries and an attractive product range in tune with the times.
In general, the activities in Harboe Nordic developed according to plan in H1 with a high demand for the group's products driven by the hot summer. Especially the German market made a positive contribution with a strong demand for both beer and soft drinks driven by the World Cup, among other things. The Northern European markets are, however, still affected by massive competition from both international branded products and regional players which operate across national borders in the Northern European region. In H1, as part of the continued efforts to address this pressure, Harboe replaced previously major agreements with low margins with new customer agreements, where the volume is lower, yet the relative and absolute contribution to earnings higher.
The activities in Harboe Nordic still represent a significant part of the group's total sales and are of strategic importance to the effective utilisation of the group's production capacity. Through continued development and further strengthening of its strategically based customer relations, Harboe seeks to maintain its position in the Northern European markets.
Harboe International markets beers, soft drinks, energy drinks and non-alcoholic malt beverages in more than 70 markets in the Middle East, Africa, South East Asia/Oceania and the Americas as well as in a number of European markets outside Northern Europe. Harboe's strategy is to increase Harboe International's relative share of the group's revenue and EBITDA through continued geographical expansion in markets where economic and demographic developments support increasing purchasing power and a demand for quality products.
Harboe International saw a positive development in the sale of own brands in H1. The targeted positioning of the group's products has paved the way for new agreements and continuing increasing sales in the Asian markets, in particular. Further work is going into the strategic positioning and organisation of our sales efforts with a view to further consolidating Harboe's position in the international markets, with the underlying growth and general market conditions providing the foundation for such consolidation. In terms of sales, focus is on the continued development of Harboe's distributor partnership and direct sales to major supermarket chains. As part of the continued growth in the geographical platform, Harboe also focuses on further streamlining business procedures and logistics coordination in close collaboration with the group's production units. Harboe International's total sales were, however, affected by unstable market conditions in a number of the group's markets, which present a challenge to day-to-day operations and future growth opportunities, notably in the Middle East and Africa. Harboe focuses at all times on making the most of the existing market potential while taking account of the political situation and the financial risk exposure.
In the Middle East, Harboe mainly markets non-alcoholic beverages, including a wide range of non-alcoholic malt beverages and traditional soft drinks, which are both growth categories. In the past five years, the activities have been expanded in collaboration with distributors and customers, and Harboe now has a strong foothold in a number of markets in the region.
The political turmoil and war-like conflicts in several places, however, continue to impact sales, and the business climate in the region is affected by a number of commercial challenges in the form of general delays in the supply chain and other operational irregularities. Harboe has continued its sales efforts in the more stable markets in the Middle East and continues to cultivate new markets in the region in close collaboration with local distributors.
Harboe sells a broad range of beers, soft drinks, malt beverages and non-alcoholic malt beverages in a growing number of African countries, primarily under own brands. Harboe's expansion in the African countries is driven by an increasing demand for strong beer and malt-based products, in particular, but the energy drinks segment is also large and growing strongly. Sales are supported by the demographic and economic developments, including a fast-growing middle class.
Sales in Africa developed positively in H1 despite continued and new challenges in certain regions, where, for example, the ebola outbreak caused a breakdown in the normal infrastructure in a large geographical area. However, developments are generally driven by a strong demand and continued intensified sales efforts in collaboration with distributors and partners that contribute solid knowledge of demand, market conditions and methods of distribution. Harboe is continuously looking to tailor its activities to the prevailing business opportunities and risks.
As part of Harboe's strategy of continued international expansion of its activities, the group has launched systematic sales efforts in South East Asia and in selected marketsin Oceania. Partnerships have been establishedwith several distributors across the region, and particularly Harboe's lager and strong beer products have gained a foothold in the South East Asian markets.
The partnerships with key distributors and the execution of the targeted sales strategy aimed at large retail chains continue, and demand underpins continued positive developments within all product categories, although the beer segment saw particularly strong growth. Harboe markets a targeted selection of own brands in an attractive price segment, where they are gaining growing recognition. Sales activities aimed at the restaurant segment also continue to show positive results. The dedicated sales activities in South East Asia and Oceania continue to contribute positively to the group's total results, although still at a modest level due to the relative size of the business and the continued investments in sales and marketing.
The latest step in the geographical expansion has been targeted at selected markets in North and South America. Initially, the activities were targeted at special consumer segments in which the dark, non-alcoholic malt beverages are seeing a strong demand. Focus has been on expanding Harboe's presence in a number of selected markets in both North and South America, identifying distributors and concluding partnership agreements with local partners. Furthermore, direct contact has been established with retail chains in selected countries where beer, in particular, but also energy drinks are growing categories. Sales in the Americas remain modest, but the potential for establishing a stronger presence in these markets is believed to be attractive.
Harboe Ingredients is the framework for Harboe's sales and development activities within malt-based food ingredients. The main activity is the traditional malt extract, which is marketed to customers in the European food industry. Development activities in recent years have identified more potential uses and created new opportunities for the strategic expansion of the business – both geographically and industrially. Harboe's strategy is a targeted pursuit of these opportunities with a view to creating attractive growth and further strengthening the group's earnings basis.
Sales within the traditional malt extract are relatively stable and are based on continued successful partnerships with existing customers.
However, Harboe's clear malt extract, which is primarily sold to customers in the food industry in the Middle East, is affected by the political turmoil in the region and has not delivered the expected level of sales. Harboe is therefore looking to cultivate new and more stable markets, and sales efforts have been further strengthened in H1 with a view to bringing increased momentum to Harboe's sales activities.
The development of other new applications continues, and partnerships have, for example, been established with new customers in the food industry on using several of Harboe's applications as alternatives to existing flavouring and colouring ingredients in, among other things, chocolate and other confectionery products.
The development work conducted in collaboration with customers in the food industry also continued in H1. Developing new applications takes several years, with ongoing tests and adaptations in close collaboration with customers, before you have the finished, marketable product. The resources allocated to these development programmes consequently affect costs in the current financial year, but this investment is expected to start generating positive returns in step with the product development being completed and the products becoming marketable over the next two to three years.
At group level, Harboe continuously focuses on achieving high capacity and flexibility in its production – also between the production units – in order to ensure that seasonal fluctuations and order intake are handled in the most optimum way. The need for flexibility is growing in line with the continued geographical expansion of the sales activities and the complexity of the product range. Great focus is therefore placed on the continuous coordination between the group's production, planning and logistics functions as well as the link with the sales organisation with a view to utilising resources more effectively and optimising the speed of the entire supply chain.
Harboe is also working on the continued updating and implementation of the group's ERP systemacrossthe geographical units.The projectis progressing according to plan, and it is expected that the entire group will have moved to the same platform in the course of the coming financial year.
The recent years' investments in energy and operational optimisations have contributed to a significant reduction of the group's operating expenses. In the current financial year, focus is also on continued streamlining, including new packaging solutions and investments in storage facilities, which can ensure further optimisation of logistics and capacity utilisation.
Investments in intangible assets and property, plant and equipment for H1 amounted to DKK 34.2 million and primarily concerned ongoing maintenance and the above efficiency improvement initiatives.
As at 31 October 2014, equity amounted to DKK 714.1 million against DKK 706.6 million as at 1 May 2014.
Equitywas affected by the resultsforthe period, foreign currency translation adjustments in respect of foreign subsidiaries and distribution of dividend.
As at 31 October 2014, the group's holding of treasury shares totalled 1,311,190 class B shares, corresponding to 21.85% of the share capital. The purchase of treasury shares was made in pursuance of a decision made at the general meeting on 5 November 2013, at which the Board of Directors was authorised to acquire up to 50%ofthe share capital untilthe company's annual general meeting in 2015.
Treasury shares are purchased, among other things, for the purpose of establishing strategic financial resources which will allow the group, as part of the continued development of its activities, to conclude strategic partnerships, and also as part of the group's general capital resources. The Board of Directors will regularly assess to what extent the holding of treasury shares is to be used as part of the value creation for the company's shareholders.
In accordance with a resolution adopted at the company's annual general meeting held on 25 August 2014, dividend corresponding to DKK 2.00 per share or a total of DKK 12 million was paid in the accounting period. Dividend isthusincreased fromlast year's payment ofDKK 1.50 pershare as part of the Board of Directors' desire to create increased value for the shareholders.
Working capital increased by DKK 33.8 million, primarily as a result of increased trade receivables. Harboe is generally being challenged by an increasing demand for extended credits on important contracts, but concurrently focuses on the continued optimisation of working capital through procurement and trade payables management etc.
Cash flows from operating activities amounted to DKK 27.8 million in H1 compared with DKK 35.5 million in the same period last year.
Free cash flow (changes in cash and cash equivalents) amounted to DKK -13.0 million compared with DKK -1.5 million in the same period last year.
Cash resources, which are composed of cash and credit facilities granted but not yet activated, amounted to DKK 204.0 million as at 31 October 2014. Added to this is the holding of treasury shares with a stock market value of DKK 109.5 million as at 31 October 2014. The total cash resources subsequently amounted to DKK 313.5 million.
As at 31 October 2014, the group's interest-bearing debt amounted to DKK 305.0million, and the netinterest-bearing debt amounted toDKK 202.9million.
As the group's sales and purchases in foreign currencies in respect of most of the group's activities are still denominated in EUR, currency risks for the group are considered limited. However, in step with the continued growth in the group's international activities, Harboe will assess the need for currency hedging on a regular basis.
In all the group's main markets, the beer and soft drinks segments are characterised by fierce competition, leading to a constant pressure on prices. Harboe is therefore very sensitive to market fluctuations in the prices of raw materials and consumables, as increasing costs cannot simply be added to the sales prices. This is true, in particular, of those of the group's products that are marketed to the discount chains. To counter such fluctuations as much as possible, Harboe is to the greatest possible extent seeking to conclude long-term contracts for the purchase of raw materials and consumables. However, only short-term contracts can be concluded for highly volatile raw materials, leading to some degree of latent risk that the results will be affected during a financial year.
In step with the group's continued geographical expansion outside of the EU-regulated markets in Europe, the group is increasingly being exposed to risks related to political turmoil and changes in political and regulatory regimes and business practices, which may affect trading conditions and approvals, import regulation, financial transactions, logistics etc. For this reason, Harboe continuously weighs these risks against the concrete market opportunities and will generally start cultivating new geographical markets in collaboration with experienced and local distributors and partners. Harboe is also working to strengthen its internal communication and business processes in relation to the handling of the group's business practices and ethical standards to ensure that the employees involved in business relations within sales, marketing, purchasing etc. are given the best possible guidance and support on how to handle deviations from normal conditions and standards, including the risk of corruption.
The current political turmoil and conflicts in various parts of the Middle East and Africa, among other regions, have resulted in special precautions and risk assessments. The exposure to business risks in these areas is continuously monitored by the group's Board of Executives and Board of Directors, which assess the specific framework and criteria for business activities, the conclusion of contracts, monetary transactions etc.
Apart from the factors described in this interim report, no material changes were seen in the group's risk and uncertainty factors. The group's risk exposure is described in further detail in the annual report for 2013/14.
Harboe revises its outlook for the full year upwards to EBITDA in the region ofDKK 115-125million (previouslyDKK 105-115million) and a profit before tax in the region of DKK 25-35 million (previously DKK 20-30 million). The adjustment is partly due to the continued positive results of the recent years' streamlining of energy consumption and production combined with improved earnings on the sales of the group's own brands, in particular.
Market conditions in the Northern European markets are, however, expected to remain extremely challenging in H2 as well with intense competition and pressure on prices. Harboe will focus on maintaining its position in these markets based on a solid product portfolio, flexibility and reliable deliveries as well as the continued positioning of the group's brands.
A continued high priority will be given to the expansion and development of the group's international activities within the drinks segment, involving the further strengthening of its sales and marketing activities. The strategic focus will be on markets where the demand for drinks products is growing, and where Harboe can establish an attractive platform for its products. The international activities are expected to be the main growth driver for the group in the next year.
Focus will also be on the development of the malt-based ingredients, with a continuation of the international sales work and targeted marketing activities. Continued progress is expected in the development of products in the company's pipeline. Collaboration with partners in the drinks industry is expected to develop positively and result in slightly increasing sales of ingredients.
Harboe expects all the group's business areas to contribute to continued positive developments in 2014/2015.
No events have occurred after the end of the period which materially affect the earnings and financial position of the company.
The interim report contains forward-looking statements, including such as relate to the future earnings performance. Such statements are subject to risks and uncertainties concerning a number of factors, many of which are outside the Harboe group's control. This may cause the actual results to deviate significantly from the outlook described in the interim report. Factors which may impact the outlook include general economic and commercial conditions, price development of raw materials, new taxes and regulation, political conditions, demand, exchange rate fluctuations and competition.
The interim report is published in Danish and English. In the event of discrepancies between the Danish and the English text, the Danish text will prevail.
Harboes Bryggeri A/S expects to publish preliminary announcements of financial statements as follows:
| Interim report, Q3 2014/15 | 19 March 2015 |
|---|---|
| Annual report 2014/2015 | 2 July 2015 |
In the period 1 May to 31 October 2014, the company has submitted the following announcements to NASDAQ OMX Copenhagen, which may be found at the company's website, www.harboe.com.
| DATE | ANNOUNCEMENT |
|---|---|
| 20 June 2014 | Notice of annual general meeting |
| 3 July 2014 | Annual report 2013/14 |
| 4 July 2014 | Financial calendar for 2014/15 |
| 28 July 2014 | Notice of annual general meeting |
| 25 August 2014 | Minutes of annual general meeting |
| 25 September 2014 | Interim report Q1 2014/2015 |
Today, we have considered and adopted the interim report of Harboes Bryggeri A/S for the period 1 May - 31 October 2014.
The interim report is presented in accordance with IAS 34, Interim Financial Reporting, as adopted by the EU and additional Danish disclosure requirements for the interim reporting of listed companies.
In our opinion, the interim report provides a true and fair view of the group's assets and liabilities and financial position as at 31 October 2014 and of the results of its activities and cash flows for H1 2013/14.
We also believe that the management commentary gives a fair review of the development in the group's activities and financial affairs, its results for the period and general financial position as well as a description of the most important risks and uncertainty factors to which the group is exposed.
Skælskør, 17 December 2014
CEO Bernhard Griese
Anders Nielsen, Chairman Bernhard Griese Mads O. Krage Carina Harboe Laursen Thøger Thøgersen Carl Erik Kjærsgaard Jens Bjarne Jensen
1 Elected by the employees
| GROUP (DKK '000) |
NOTE 2014/15 |
Q2 Q2 2013/2014 |
H1 2014/2015 |
H1 2013/2014 |
FY 2013/2014 |
|---|---|---|---|---|---|
| Gross revenue Taxes on beer and soft drinks |
388,824 (47,036) |
419,476 (60,952) |
830,671 (96,824) |
886,612 (135,071) |
1,626,919 (206,807) |
| Revenue | 341,788 | 358,524 | 733,847 | 751,541 | 1,420,112 |
| Production costs | (280,962) | (296,781) | (600,023) | (618,137) | (1,177,552) |
| Gross profit/(loss) | 60,826 | 61,743 | 133,824 | 133,404 | 242,560 |
| Distribution costs Administrative expenses Other operating income Other operating expenses |
(43,264) (12,805) (2,441) |
(46,979) (11,688) 8,043 8,134 (3,111) |
(91,096) (26,417) 15,738 (4,615) |
(97,275) (24,758) 14,168 (6,742) |
(190,704) (49,628) 28,206 (13,739) |
| Operating profit/(loss) | 10,359 | 8,099 | 27,434 | 18,797 | 16,695 |
| Financial income Financial expenses |
(2,046) | 780 661 (2,125) |
1,575 (4,032) |
833 (3,542) |
2,627 (8,919) |
| Profit/(loss) before tax | 9,093 | 6,635 | 24,977 | 16,088 | 10,403 |
| Calculated tax on profit/(loss) for the period Adjustment of tax, previous years |
(2,716) | (2,382) 0 0 |
(6,735) 0 |
(4,855) 549 |
(2,121) 2,309 |
| Net profit/(loss) for the period | 6,377 | 4,253 | 18,242 | 11,782 | 10,591 |
| Distribution of net profit/(loss) for the period Shareholders of the parent Minority interests |
18,236 6 |
11,785 (3) |
10,627 (36) |
||
| Earnings per share (DKK per DKK 10 share) Earnings per share and diluted earnings per share (DKK) |
2 | 3.76 | 2.13 | 2.02 |
| GROUP (DKK '000) |
H1 2014/2015 |
H1 2013/2014 |
FY 2013/2014 |
|---|---|---|---|
| Net profit/(loss) for the period | 18,242 | 11,782 | 10,591 |
| Other comprehensive income Items which may be recirculated to the income statement |
|||
| Foreign currency translation adjustments regarding foreign enterprises | (1,300) | 102 | 441 |
| Fair value adjustment of financial assets available for sale | 0 | 0 | 70 |
| Recirculation to the income statement of fair value adjustment upon disposal | |||
| of financial assets available for sale | 0 | 0 | 22 |
| Tax on other comprehensive income | 0 | 0 | (22) |
| Other comprehensive income | (1,300) | 102 | 511 |
| Comprehensive income | 16,942 | 11,884 | 11,102 |
| Distribution of comprehensive income for the period | |||
| Shareholders of the parent | 16,936 | 11,887 | 11,138 |
| Minority interests | 6 | (3) | (36) |
| GROUP (DKK '000) |
31 October 2014 |
31 October 2013 |
30 April 2014 |
|---|---|---|---|
| Goodwill | 3,573 | 3,573 | 3,573 |
| Development projects | 4,748 | 6,172 | 5,460 |
| Rights | 5,709 | 5,435 | 5,724 |
| Software | 16,571 | 20,367 | 18,664 |
| Intangible assets under construction | 129 | 0 | 80 |
| Intangible assets | 30,730 | 35,547 | 33,501 |
| Land and buildings | 238,897 | 239,565 | 235,185 |
| Plant and machinery | 432,131 | 452,711 | 442,164 |
| Other plant, fixtures and fittings, tools and equipment | 22,519 | 25,638 | 23,858 |
| Spare parts for own production equipment | 3,199 | 4,038 | 3,619 |
| Property, plant and equipment under construction | 6,616 | 6,283 | 14,789 |
| Property, plant and equipment | 703,362 | 728,235 | 719,615 |
| Investment properties | 58,625 | 62,324 | 60,475 |
| Financial assets available for sale | 8,192 | 178,975 | 8,706 |
| Deposits, leases | 2,445 | 2,403 | 2,423 |
| Financial assets | 10,637 | 181,378 | 11,129 |
| Deferred tax assets | 5,783 | 3,746 | 5,804 |
| Non-current assets | 809,137 | 1,011,230 | 830,524 |
| Raw materials, consumables and packaging | 67,310 | 70,003 | 73,465 |
| Finished goods and goods for resale | 79,990 | 72,844 | 88,024 |
| Inventories | 147,300 | 142,847 | 161,489 |
| Trade receivables | 300,875 | 272,375 | 278,670 |
| Other receivables | 4,425 | 6,156 | 6,030 |
| Prepayments | 10,501 | 11,224 | 8,568 |
| Receivables | 315,801 | 289,755 | 293,268 |
| Cash | 100,526 | 5,934 | 96,235 |
| Assets held for sale | 2,200 | 2,400 | 2,200 |
| Current assets | 565,827 | 440,936 | 553,192 |
| Total assets | 1,374,964 | 1,452,166 | 1,383,716 |
| GROUP (DKK '000) NOTE |
31 October 2014 |
31 October 2013 |
30 April 2014 |
|---|---|---|---|
| Share capital Share premium Other reserves Retained earnings |
60,000 0 4 (5,372) 659,346 |
60,000 51,000 (4,465) 666,647 |
60,000 0 (4,072) 650,487 |
| Equity owned by shareholders of the parent | 713,974 | 773,182 | 706,415 |
| Equity owned by minority interests | 149 | 174 | 143 |
| Equity | 714,123 | 773,356 | 706,558 |
| Mortgage debt Provision for deferred tax Deferred recognition of income |
192,790 49,461 55,920 |
208,348 51,794 62,766 |
200,470 49,534 60,882 |
| Non-current liabilities | 298,171 | 322,908 | 310,886 |
| Mortgage debt Other credit institutions Trade payables Repurchase of returnable packaging Income tax Other payables Deferred recognition of income Deferred income |
15,693 96,531 135,723 8,321 7,075 91,739 7,273 315 |
15,683 62,824 169,440 9,260 4,389 84,875 9,431 0 |
15,772 78,480 172,008 8,030 2,309 81,488 7,874 311 |
| Current liabilities | 362,670 | 355,902 | 366,272 |
| Liabilities | 660,841 | 678,810 | 677,158 |
| Equity and liabilities | 1,374,964 | 1,452,166 | 1,383,716 |
| GROUP (DKK '000) |
H1 2014/2015 |
H1 2013/2014 |
FY 2013/2014 |
|---|---|---|---|
| Operating profit/(loss) | 27,434 | 18,797 | 16,695 |
| Depreciation and amortisation etc. | 43,560 | 44,294 | 90,052 |
| Grants and other adjustments recognised as income | (5,004) | (5,602) | (10,023) |
| Cash flows from operating activities before change in working capital | 65,990 | 57,489 | 96,724 |
| Change in inventories | 13,936 | (9,427) | (28,010) |
| Change in trade receivables | (22,787) | 15,392 | 9,205 |
| Change in other receivables | (384) | 704 | 3,490 |
| Change in trade payables etc. | (35,983) | (2,978) | (451) |
| Change in other current liabilities | 11,456 | (20,269) | (22,192) |
| Change in working capital | (33,762) | (16,578) | (37,958) |
| Cash flows from primary operating activities | 32,228 | 40,911 | 58,766 |
| Financial income received | 1,555 | 826 | 2,580 |
| Financial expenses paid | (4,040) | (3,592) | (8,930) |
| Taxes paid, net | (1,940) | (2,692) | (5,818) |
| Cash flows from operating activities | 27,803 | 35,453 | 46,598 |
| Purchase of intangible assets | (561) | (1,406) | (2,330) |
| Purchase of property, plant and equipment | (25,536) | (10,645) | (43,564) |
| Sale of property, plant and equipment | 1,968 | 1,010 | 2,085 |
| Dividend received from financial assets available for sale | 29 | 7 | 54 |
| Purchase of financial assets | (22) | 0 | (20) |
| Sale of financial assets | 132 | 129 | 169,222 |
| Cash flows from investing activities | (23,990) | (10,905) | 125,447 |
| Dividend paid | (9,377) | (8,322) | (8,323) |
| Investment grant received | 404 | 871 | 1,803 |
| Repayment of non-current liabilities, net | (7,882) | (7,774) | (15,569) |
| Purchase of treasury shares | 0 | (10,802) | (76,802) |
| Cash flows from financing activities | (16,855) | (26,027) | (98,891) |
| Changes in cash and cash equivalents | (13,042) | (1,479) | 73,154 |
| Cash and cash equivalents as at 1 May | 17,037 | (55,411) | (55,399) |
| Cash and cash equivalents as at 31 October | 3,995 | (56,890) | 17,755 |
| owned by | Equity | ||||||
|---|---|---|---|---|---|---|---|
| Share | shareholders | owned by | Total | ||||
| Share | premium | Other | Retained | of the | minority | equity | |
| capital | premium | reserves | earnings | parent | shareholders | equity | |
| Equity as at 1 May 2013 | 60,000 | 51,000 | (4,567) | 673,985 | 780,418 | 179 | 780,597 |
| Changes in equity 2013/14 | |||||||
| Comprehensive income for the year | 0 | 0 | 102 | 11,786 | 11,888 | (5) | 11,883 |
| Dividend paid | 0 | 0 | 0 | (9,000) | (9,000) | 0 | (9,000) |
| Dividend from treasury shares | 0 | 0 | 0 | 677 | 677 | 0 | 677 |
| Purchase of treasury shares | 0 | 0 | 0 | (10,801) | (10,801) | 0 | (10,801) |
| Total changes in equity | 0 | 0 | 102 | (7,338) | (7,236) | (5) | (7,241) |
| Equity as at 31 October 2013 | 60,000 | 51,000 | (4,465) | 666,647 | 773,182 | 174 | 773,356 |
| Equity as at 1 May 2014 | 60,000 | 0 | (4,072) | 650,487 | 706,415 | 143 | 706,558 |
| Changes in equity 2014/15 | |||||||
| Comprehensive income for the year | 0 | 0 | (1,300) | 18,236 | 16,936 | 6 | 16,942 |
| Dividend paid | 0 | 0 | 0 | (12,000) | (12,000) | 0 | (12,000) |
| Dividend from treasury shares | 0 | 0 | 0 | 2,623 | 2,623 | 0 | 2,623 |
| Total changes in equity | 0 | 0 | (1,300) | 8,859 | 7,559 | 6 | 7,565 |
| Equity as at 31 October 2014 | 60,000 | 0 | (5,372) | 659,346 | 713,974 | 149 | 714,123 |
The interim financial statements are presented as compiled financial statements in accordance with IAS 34, Interim Financial Reporting, as adopted by the EU. No interim financial statements have been prepared for the parent.
The interim financial statements are presented in Danish kroner (DKK), which is the functional currency of the parent.
The accounting policies applied in the interim financial statements are consistent with those applied in the consolidated financial statements for 2013/14, which are in accordance with the International Financial Reporting Standards as adopted by the EU.
Reference is made to the annual report for 2013/14 for a more detailed description of the accounting policies applied, including the definitions of the ratios stated, which have been calculated in accordance with the definitions of the 'Recommendations and Financial Ratios 2010' issued by the Danish Society of Financial Analysts.
The interim report has not been reviewed by the company's auditors.
The company announcement is published in Danish and English. In the event of discrepancies between the Danish and the English text, the Danish text will prevail.
The preparation of interim reports requires the management to make certain accounting estimates which affect the application of the accounting policies and recognised assets, liabilities, income and expenses. Actual results may deviate from these estimates.
The most significant estimates made by the management in applying the group's accounting policies and the considerable uncertainty associated with these estimates are the same in connection with the preparation of the compiled interim report as for the preparation of the annual report for 2013/14.
| GROUP (DKK '000) |
H1 2014/15 |
H1 2013/14 |
|---|---|---|
| 2 EARNINGS PER SHARE AND DILUTED EARNINGS PER SHARE | ||
| Earnings per share and diluted earnings per share (DKK per share of DKK 10) | 3.76 | 2.13 |
| The basis of calculation of earnings per share and diluted earnings per share is as follows: | ||
| Profit distributed to shareholders of the parent used in connection with the calculation of earnings per share | 18,236 | 11,785 |
| 2012/13 No. of shares of DKK 10 |
2013/14 No. of shares of DKK 10 |
|
|---|---|---|
| Average number of shares Average number of treasury shares |
6,000,000 (1,148,953) |
6,000,000 (471,513) |
| Number of shares used to calculate earnings per share (no.) | 4,851,047 | 5,528,487 |
| Average dilution effect of outstanding pre-emption rights etc. (no.) | 0 | 0 |
| Number of shares used to calculate diluted earnings per share (no.) | 4,851,047 | 5,528,487 |
Based on the internal reporting, which is used for the allocation of profit and resources, the company has identified one operating segment, the brewery sector, which is in line with the way in which activities are organised and controlled.
The group's activities are mainly distributed on Denmark, Germany and other geographical areas.
The group's revenue from external customers and the distribution of non-current assets on these geographical areas are specified below, where revenue is distributed on the basis of the domicile of the customers, and non-current assets are distributed on the basis of the physical location and legal affiliation, respectively.
| Revenue | Non-current assets | |||
|---|---|---|---|---|
| (DKK '000) | 2014/15 | 2013/14 | 2014/15 | 2013/14 |
| Denmark | 178,853 | 184,603 | 348,668 | 356,361 |
| Germany | 324,586 | 312,491 | 358,811 | 378,779 |
| Other geographical areas | 230,408 | 254,447 | 23,040 | 25,069 |
| 733,847 | 751,541 | 730,519 | 760,209 |
Out of the group's total revenue in Denmark and Germany, sales to a single customer account for approx. 25% of revenue.
| GROUP (DKK '000) |
31 October 2014 |
31 October 2013 |
|
|---|---|---|---|
| 4 OTHER RESERVES Reserve for foreign currency translation adjustments Reserve for fair value adjustment of financial assets available for sale |
(764) (4,608) |
197 (4,662) |
|
| (5,372) | (4,465) | ||
| Reserve for foreign currency translation adjustments |
financial assets available for sale Reserve for value adjustment of |
Other reserves, total | |
| Other reserves as at 1 May 2013 | 95 | (4,662) | (4,567) |
| Foreign currency translation adjustment regarding foreign enterprises | 102 | 0 | 102 |
| Other reserves as at 31 October 2013 | 197 | (4,662) | (4,465) |
| Other reserves as at 1 May 2014 | 536 | (4,608) | (4,072) |
| Foreign currency translation adjustment regarding foreign enterprises | (1,300) | 0 | (1,300) |
| Other reserves as at 31 October 2014 | (764) | (4,608) | (5,372) |
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