Annual Report • Mar 25, 2014
Annual Report
Open in ViewerOpens in native device viewer
| 2013 | 2012 | ||
|---|---|---|---|
| Net sales | EUR million | 1,411.0 | 1,343.6 |
| EBIT | EUR million | 19.7 | 30.2 |
| EBIT | % | 1.4 | 2.2 |
| Balance sheet total | EUR million | 978.1 | 1,041.6 |
| Return on equity | % | -1.0 | 2.4 |
| Return on investment | % | 3.7 | 4.7 |
| Equity ratio | % | 42.2 | 41.5 |
| Net gearing | % | 74.3 | 84.3 |
| Non-recurring items* | EUR million | -17.3 | -0.5 |
* Non-recurring items are included in the reported fi gures.
Net sales increased by EUR 67.4 million or 5.0 per cent to EUR 1,411.0 million. Atria Finland's and Atria Scandinavia's net sales increased by EUR 67.3 million and EUR 7.2 million, respectively. Atria Russia's and Atria Baltic's net sales decreased by EUR 4.8 million and EUR 1.3 million, respectively.
-34.8 %
EBIT decreased by EUR 10.5 million or 34.8 per cent to EUR 19.7 million. The decrease was due to the non-recurring costs recognised for Atria Russia's restructuring, which amounted to EUR 25.0 million (EUR 17.4 million allocated to EBIT). Without these, EBIT was EUR 37.0 million.
Atria Plc is a growing Finnish food company that is expanding its international presence. Atria Group is one of the leading food companies in the Nordic countries, Russia and the Baltic region.
Atria's net sales in 2013 were EUR 1,411 million. Atria employed an average of 4,670 people. Th e Group is divided into four business areas: Atria Finland, Atria Scandinavia, Atria Russia and Atria Baltic.
Atria's customer groups are consumer goods retail trade, Food Service customers and the food industry. In addition, Atria has a Fast Food concept business based on its own brands.
Atria's roots go back to 1903, when its oldest shareholding cooperative was founded. Today, Atria Plc's shares are quoted on the NASDAQ OMX Helsinki Ltd stock exchange.
| Atria Group key indicators 1 | |
|---|---|
| Atria Plc 2 | |
| CEO's interview 3 | |
| Strategy 5 |
| Review of operations, year 2013 9 | |
|---|---|
| Atria Finland 9 | |
| Atria Scandinavia 15 | |
| Atria Russia 19 | |
| Atria Baltic 24 | |
| Product development and marketing 27 |
| Corporate responsibility 28 | |
|---|---|
| Financial statement | |
| and annual report 30 | |
| Corporate Governance 100 | |
| Investor reporting 119 | |
| Contact information 121 |
CEO Juha Gröhn, although no signs of a real recovery in consumer purchasing power were seen in any of Atria's business areas, Atria achieved growth of around fi ve per cent. Would you say that Atria managed to strengthen its commercial excellence, one of the cornerstones of its Group strategy?
In Finland, 2013 was a year of strong growth and we strenghtened our market position. Our market share in Finland is currently around 27 per cent, up from the previous year's 25 per cent. In Atria Scandinavia, an upward trend was seen in our Danish operations, which grew despite the tough competitive environment. In the Swedish market, we recorded slight growth measured in
"In Finland, 2013 was a year of strong growth."
the local currency. In Russia, growth was slower, but the trend was positive there as well. In the Baltic countries, sales in the retail sector increased but exports decreased. In Russia and Estonia, we continued to sharpen up our product off ering by eliminating unprofi table products. Th is slowed down growth but improved our profi tability.
A signifi cant proportion of the growth was due to an increase in prices and the degree of processing. Volumes grew substantially in certain product groups, such as in poultry in Finland and in the Sibylla concept in all markets.
One of Atria's current and future strategic themes is commercial excellence. It means productisation that is interesting from Atria's perspective and suits people's ways and styles of living, determined marketing, sales expertise and selling power.
Consolidated EBIT fell by more than EUR 10 million year-on-year, owing to Atria Russia's non-recurring cost items. Without these items, Atria's earnings totalled approximately EUR 37 million, up by around 20 per cent from the year before. How important was the second cornerstone of Atria's strategy – effi ciency – to the improvement of profi tability?
Effi cient and productive operations have improved our operating profi t, although the market conditions were not particularly favourable. Especially important advances
Juha Gröhn CEO, Atria Plc
"Especially important advances were the substantial effi ciency improvements in the industrial operations in Russia, the opening of the bovine slaughterhouse in Kauhajoki and the increased effi ciency of cold cuts production in Sweden."
were the substantial effi ciency improvements in the industrial operations in Russia, the opening of the bovine slaughterhouse in Kauhajoki and the increased effi ciency of cold cuts production in Sweden. Smaller reforms that may seem mundane have also contributed to the
improvement in productivity. Our performance in Estonia is cause for satisfaction.
Competition will continue to be fi erce in all markets. Effi ciency is an essential competitive factor. It should be seen as an overarching theme – not just as an issue related to the manufacturing of products or the logistics chain, but as something that concerns all processes and functions.
Atria's profi tability curve is largely dependent on global market prices for raw materials and meat. However, the prices have diff erent repercussions for Atria's various business areas. How would you characterise the international meat market relative to Atria's profi tmaking capability?
Th e cost level of the entire meat supply chain has been on the rise from primary production to industry. Th e cost increases are partially the result of higher prices of cereals and feed. Various taxes and tax-like cost factors also have a greater impact on meat and food prices than before. Th e situation in the meat market, which deteriorated towards the end of the year, had a negative eff ect on the
"Finnish consumers are interested in Finnish food and Finnish meat."
profi t of the Finnish operations, in which meat trade plays a major role. In Scandinavia, our operations were stabilised by steadier prices of meat raw materials. In Russia, the availability of raw materials has been good. In this business area, the price of meat at the plant mostly consists of customs duties and import levies and, under some circumstances, Russian prices move in the opposite direction of world market prices.
On January 2014 Atria acquired Saarioinen's meat procurement, slaughtering and meat cutting operations for approximately EUR 30 million. How do you think this deal will aff ect the Group's growth and profi tability?
Our net sales will increase by around EUR 70 million. Relative profi tability will not be aff ected, nor will the deal have a material impact on the company's fi nancial
position. Th e deal will strengthen Atria as a supplier of meat products in Finland. We are now even better placed to provide Finnish meat to retail chains, restaurants and catering services. Finnish consumers are interested in Finnish food and Finnish meat.
Atria cascaded its strategy in the various business areas through dozens of individual development projects. Could you highlight some projects that you consider to be particularly important for Atria's profi table growth over the long term?
We have contributed to the implementation of the strategy by working in projects. For example, the growth we achieved in Finland was preceded by detailed project development and planning. Also, we have made eff orts in all business areas to develop meat production technology. Moreover, all business areas have their own development projects, large and small, that are being systematically managed and monitored.
One of the most signifi cant development initiatives has been the comprehensive project known as the Atria Way of Work. Together we have defi ned the issues that are important for us at Atria and the things about the Atria way of life in which we believe and trust across national borders. Th e objective was to concisely describe what it means to be an Atria employee and to improve our capabilities and attitudes in order to implement the current strategy. A further aim was to create a solid basis of know-how for the coming years.
***
In 2013, we made major structural and operational changes to strengthen and accelerate Atria's profi table growth. We were able to transform the company and take several steps towards our goal of making Atria number one. I would like to thank all Atria employees and our partners for their fi ne work for the benefi t of our customers, consumers, our shareholders and our company.
Seinäjoki, March 2014
Juha Gröhn CEO, Atria Plc
With its strategy, Atria strives to improve profi tability, boost growth and increase the company's value. It will implement the strategy by developing the following three operational dimensions: commercial excellence, effi ciency and the common Atria Way of Work.
Atria aims to be the market leader or a strong number two in the Group's core operations, which include cold cuts and processed meat products. Th e market for cold cuts and other
meat products is a high-volume business that provides growth potential for Atria.
Atria is also aiming at the top in local core operations, such as poultry and convenience foods, Atria Deli and Sibylla operations, selected Private Label product groups, consumer-packed meat, and slaughtering and cutting operations.
COMMERCIAL
Category leadership
Reducing wastage
As part of strategy work, Atria's management renewed the Group's vision. Its summary was published in spring 2013.
In the future, Atria will be present at both people's daily meals and celebrations in all of its business areas. Atria employees are
enthusiastic, even passionate about good food and its preparation. Th is attitude and feeling creates a positive spiral of commercial success.
| ATRIA WAY OF WORK | |||
|---|---|---|---|
| WE FOCUS ON CONSUMERS AND CUSTOMERS |
WE ARE HUNGRY FOR SUCCESS |
WE DELIVER QUALITY |
WE ENJOY OUR WORK |
| to the defi nition of the way of work. | |||
| Th e Way of Work (WoW) discussions held in the various |
Value discussions had already been |
Atria Way of Work
Atria Group's employees got together to defi ne the Group's way of work and values – the Atria Way of Work package.
discussions held in the various business areas in autumn 2013 were received with enthusiasm among the personnel. Some 75 per cent of Atria employees in Finland, Sweden, Denmark and Estonia contributed
Value discussions had already been held in Russia. Although the Group's values are the same in all business areas, individual diff erences exist in what is emphasised and how the values are worded.
For Atria, the concept of good food covers the entire food chain from primary production to the consumer's table. Atria's good food is produced in a responsible and ethical manner; it is of high quality, it is safe and it generates a better mood for all our stakeholders.
| MEASURES | Estimated annual savings | |
|---|---|---|
| Atria Finland | Centralisation of bovine slaughtering in Kauhajoki | EUR 6 million |
| Nurmo effi ciency improvement programme | EUR 4 million | |
| Centralisation of cured sausage production at Atria Scandinavia's production plant in Denmark |
EUR 0.3 million | |
| Centralisation of convenience food production at the Nurmo plant | EUR 1 million | |
| Atria Scandinavia | Centralisation of black pudding production in Tranås | EUR 1 million |
| Centralisation of production of ham products and slicing of cold cuts | ||
| at the Malmö plant | EUR 1.5 million | |
| Atria Russia | Centralisation of production of meat products at the Sinyavino and Gorelovo plants | EUR 7.5 million |
| Effi ciency improvement programme at the Sinyavino and Gorelovo plants | EUR 2 million | |
| Discontinuation of primary pork production and closure of the Moscow plant and logistics centre |
EUR 6 million | |
| Atria Baltic | No programmes, single improvement projects |
| Target | Achieved in 2013 | |
|---|---|---|
| EBIT | 5% | 1.4% |
| Equity ratio | 40% | 42.2% |
| Return on equity (ROE) | 8% | -1.0% |
| Dividend distribution of profi t from period | 50% | -142.8% |
The risk map below shows examples of risks to Atria's operations. Description of risks; Report by the Board of Directors, page 35. Financial risk management; Notes to the Consolidated Financial Statements, page 79.
| BUSINESS RISKS | RISKS OF DAMAGE FINANCIAL RISKS |
OPERATIONAL RISKS | ||
|---|---|---|---|---|
| • Raw material price risk | • Political risks | • Currency risks | • Product safety risk | |
| • Business environment risks | (country risk for Russia) | • Interest rate risk | • Contract risks | |
| (competitor risk, reputational risks) |
• Animal disease risk • Property damage and |
• Refi nancing risk | • Occupational safety risks | |
| • Investment risks | interruption risks | ATRIA |
ATRIA FINLAND develops, manufactures and markets fresh food and related services in Finland. The company's net sales in 2013 amounted to EUR 886.8 million and the company had 2,146 employees.
Atria Finland's leading brand is Atria, one of the best-known and most valuable food brands in Finland. Atria is the market leader in many of its product groups in Finland. According to Atria's own estimate, its market share in the consumer goods retail trade is approximately 27 per cent.
Business environment1)
1) Sources: Finland's TNS Gallup Agriculture Unit, the Finnish Grocery Trade Association (FGTA) and Atria, 2014.
Atria Finland's net sales increased by more than 8% to EUR 886.8 million, up by EUR 67.3 million from the previous year. Atria grew by consolidating its market position both in the consumer goods retail trade and among Food Service customers. Sales to export and wholesale trade customers also rose.
EBIT amounted to EUR 32.9 million1), down from the previous year's EUR 36.5 million. The company's earning capacity was reduced by the decrease in consumers' average purchases and intense price competition particularly in the consumer goods retail trade. The price level also fell short of expectations in the wholesale and industrial segments. EBIT accounted for 3.7% of net sales, compared to the previous year's 4.5%.
1) The fi gure includes a non-recurring profi t of EUR 1.1 million resulting from a reversal of impairment.
+5%
The prices of all foods in the consumer goods retail trade increased by an average of 5% and prices in the HoReCa sector by 6.1%.2)
The consumer prices of meat and meat products rose by an average of 7%. The increase in prices in the spring was followed by a decrease in the autumn. The prices of different types of meat products rose as follows:
Producer prices rose by an average of 9%, as follows:
Grocery trade volumes fell slightly (when all types of shops are taken into account) for the second year in a row. Prior to this, grocery trade volumes have decreased only three times in 35 years. The weak economic conditions and high taxation reduced consumer purchasing power.2) At the beginning of 2013, the general VAT rate increased to 24% and the rate for food to 14%.
2) Source: The Finnish Grocery Trade Association (FGTA), 2014 3) Source: Suomen Gallup Elintarviketieto, 2014
Market share increased Atria Finland's overall market share increased by about two percentage points. In the consumer goods retail trade, its share as a producer was 27%. Atria also strengthened its share among Food Service customers.1)
1) Source: Atria, 2014
Awareness of the Atria brand among Finns increased by three percentage points in a year (autumn 2012–2013). This favourable trend was contributed to by successful product development, marketing and sales efforts.
Top-of-mind food brands in Finland 2)
COMMERCIAL EXCELLENCE
2) Source: TNS, Food Brand Survey, 10/2013. In the survey, consumers answer the following open-ended question: "Which food-related brand or manufacturer comes to your mind fi rst?"
The key marketing message for customers and consumers was the Atria brand's 100% commitment to traceable, domestic meat raw material.
Europe's most modern bovine slaughterhouse and cutting plant, which was fully opened in 2013, takes Atria's bovine slaughtering to a whole new level. This EUR 26 million investment has improved productivity per kilogram of beef. Concentrating production in Kauhajoki has also raised the productivity of the entire Atria beef chain.
EFFICIENCY
A new poultry feed plant was completed in Koskenkorva with a production capacity of around 100 million kilograms a year. This EUR 15 million investment is located on the same site as A-Rehu's pig and cattle feed production. A-Rehu's production capacity in Koskenkorva will increase to approximately 240 million kilograms a year. The poultry feed plant, which is the result of cooperation between producers and A-Rehu, ensures that Finland will continue to have domestically-owned feed production in the future.
1) See the Meat Barometer on page 13.
Atria's delivery reliability remained excellent, exceeding 99.5%. Delivery reliability is one of Atria's key competitive advantages, particularly during high season.
Volumes of processed meat The meat volumes processed by Atria increased by a total of 4 million kilograms to 153 million kilograms. The volumes of processed chicken grew most by 4 million kilograms. Procurement volumes for pork rose by 1 million kilograms. The volumes of processed beef decreased by 1 million kilograms. Atria is Finland's leading pork and beef processor.
Atria launched a three-phase production development programme extending to 2015. In the fi rst and second phases, improvements will be made in the quality of operations and product quality, respectively. The third phase will aim to achieve higher productivity in a sustainable manner. The project will be implemented through individual projects and initiatives.
In 2013, the volume of meat placed on the Finnish market rose slightly from the previous year, totalling 387 million kilograms of bone-in meat. Most of this growth occurred in the volume of chicken. Total consumption also remained roughly the same, with only chicken consumption increasing markedly. The total volume of imported meat decreased slightly.
Source: Suomen Gallup Elintarviketieto, 2014
| MEAT TOTAL, mill. kg | 2013 | 2012 | Change % compared to previous year |
|---|---|---|---|
| Production | 386.9 | 381.7 | 1.4 |
| Consumption | 404.5 | 403.7 | 0.2 |
| Export* | 57.3 | 51.2 | |
| Import* | 76.5 | 77.8 | -1.3 |
| Consumption domestic content, % | 81.1 | 80.7 |
| Production | 194.3 | 192.7 | 0.8 | |
|---|---|---|---|---|
| Consumption | 193.9 | 194.7 | -0.7 | |
| Export* | 33.5 | 30.0 | 11,3 | |
| Import* | 32.1 | 34.7 | -7.8 | |
| Consumption domestic content, % | 81.1 | 82.2 |
| Production | 80.3 | 80.2 | 0.1 | |
|---|---|---|---|---|
| Consumption | 98.2 | 100.8 | -2.3 | |
| Export* | 1.5 | 0.8 | 66,7 | |
| Import* | 22.4 | 22.2 | 2.3 | |
| Consumption domestic content, % | 77.2 | 78.0 |
| Production | 110.9 | 107.4 | 3.3 |
|---|---|---|---|
| Consumption | 105.7 | 101.8 | 8.8 |
| Export* | 22.2 | 20.3 | 8,8 |
| Import* | 16.7 | 15.9 | 7,1 |
| Consumption domestic content, % | 84.2 | 84.4 |
* The export and import fi gures for November and December are estimate.
In 2013, Atria Finland was able to consolidate its market position and grow more rapidly than the market: more than eight per cent measured by net sales, or around EUR 67 million. Do you believe growth will be as rapid in 2014, Mika Ala-Fossi?
It's hard to say anything about the rate, but we will certainly grow. Th e net sales of the operations acquired from Saarioinen alone are in the region of EUR 70 million. Th e bovine slaughterhouse investment in Kauhajoki enables Atria to increase its production capacity well into the future. Th e new poultry fodder plant in Koskenkorva will increase A-Rehu's aggregate production capacity by more than 70 per cent. I would also say that the Atria brand's core promise – its commitment to domestic meat – will also accelerate our growth. It's a strong promise and one that the Finnish consumer trusts.
We have growth drivers, but on the other hand, there are also major challenges for growth. Th e biggest question mark is the development of Finns' purchasing power and sales prices. If the economy continues to be sluggish, competition over shelf space will surely be fi erce – also with regard to inexpensive products.
"A commitment to domestic meat is a strong promise – one that the Finnish consumer trusts."
Profi tability remained reasonable: the EBIT percentage was 3.7, generating a profi t of around EUR 33 million. What are the means or tools that will help you to get closer to the Group's shared target level of fi ve per cent?
If price competition in the market intensifi es further, we will need to work hard to achieve even satisfactory results. Th en again, we are used to this. In addition to consumer prices, profi tability will depend on the costs of primary production and on our own actions. Atria's productivity and effi ciency in everything we do will be of primary importance. Th is will determine our price
Mika Ala-Fossi Executive Vice President Atria Finland
competitiveness.
Atria is rather competitive, and I would say we are going to see further improvement thanks to the new investments. Now we must ensure that these investments are exploited to the full as quickly as possible and that the effi ciency improvements of old processes continue according to plan. It is also extremely important that the operations acquired from Saarioinen are integrated into Atria quickly and smoothly.
ATRIA SCANDINAVIA produces meat products, meals and delicatessen products in Sweden and Denmark. The company's net sales in 2013 amounted to EUR 395 million and the company had 1,050 employees.
Atria Scandinavia's bestknown brand in Sweden is Sibylla, which is also Atria's most international brand. In Denmark, the best-known brand is 3-Stjernet. Atria Scandinavia holds second position in the cold cuts and sausages product groups in Sweden and is the market leader in cold cuts in Denmark.
1) Source: DLF 2013 2) Source: Svensk Kött, 2014
EBIT rose
Atria Scandinavia's net sales grew by around 2% to EUR 395.0 million, up by EUR 7.2 million from the previous year. Sales to Sibylla fast food and Food Service customers were particularly strong. In the consumer goods retail market, the most signifi cant growth was seen in the Lithells brand products. Atria's market position in Denmark strengthened.
EBIT grew by 49% to EUR 12.2 million1). This accounted for 3.1% of net sales, compared to the previous year's 2.1%. An improved sales structure, successful marketing efforts, stable meat raw material prices and a lighter cost structure all contributed to this rise.
1) The fi gure includes a non-recurring cost of EUR 1.0 million.
Prices of meat products The prices of meat products in Sweden rose by an average of 4.8%, with the greatest rise seen in sausages. In Denmark, prices remained practically unchanged. The consumption of meat products increased by 1% in Sweden.2)
Meat product volumes The sales of meat products increased only marginally in Sweden: the growth in cold cuts and sausages was 0.3% and 1.4%, respectively. In Denmark, the sales of cold cuts declined by 0.2%.2)
Private labels continued to grow strongly in Sweden. In sausages, the growth was 20.3%. 2)
Pork production volumes in Sweden decreased by almost 3%, although the reduction was no longer as steep as before. Some 60% of the pork consumed was domestic. Bovine slaughtering volumes rose slightly.3)
Atria consolidated its market leadership in the Danish cold cuts market with the 3-Stjernet brand. Its market share increased by 0.4 percentage points to around 15%.
The investments made in the Lithells brand were successful: the brand grew by 6.7% in the Swedish consumer goods retail market1). The "Oskar Lithells fi naste" and "Lithells världskorv" concepts were well received.
1) Source: ACNielsen, 2013
The market for barbecue products grew by 15% in Sweden during the summer. Sales of Lithells grill sausages rose by no less than 85%, thanks to new product launches.
| Product group | SWEDEN | DENMARK | ||
|---|---|---|---|---|
| Market share |
Market size | Market share |
Market size | |
| Cold cuts | 17.8% | EUR 517 million | 14.8% | EUR 388 million |
| Sausages | 11.5% | EUR 419 million |
Source: ACNielsen, 2013
The number of Sibylla shops-in-shops increased by 12% to around 3,800. The number of fast food meals sold in these grew by 6% to approximately 91 million. The strongest growth has been seen in Russia. The number of sales outlets in key markets was as follows (9/2013):
The closing of the Halmstad plant in 2012 and the transfer of production to the Malmö plant generated annual cost savings of about EUR 1.5 million. The EUR 5 million investments made in meat processing equipment at the Malmö plant have considerably improved Atria's competitiveness in the cold cuts market.
In fi ve years, the number of Atria Scandinavia's plants has reduced by ten. Currently, Atria has seven production plants in Sweden and two in Denmark. Effi ciency has improved and the cost structure has become lighter.
In 2013, Atria Scandinavia was able to slightly increase its net sales, although the market did not recover and the share of private labels grew markedly in Sweden. What are the growth prospects for 2014, Tomas Back?
We expect the markets in Sweden and Denmark to remain fairly stable compared to the previous year. Both markets are projected to grow marginally, but the market share of private labels will strengthen further. Despite this, we aim to grow, both by selling our own brands and through private label products.
Profi tability improved substantially. EBIT without nonrecurring items grew to EUR 13.2 million, or 3.3 per cent of net sales. What do you think are the possibilities of profi tability continuing to improve in 2014?
We are satisfi ed with the development of our profi tability in the second half of 2013 and we aim at benefi tting from this good trend also in 2014. However, the precondition for this is that the price of meat raw material remains stable. Our sales structure will be slightly weaker, as private label volumes will grow. On the other hand, we have implemented signifi cant effi ciency improvement measures that will improve our cost structure.
"We have implemented signifi cant effi ciency improvement measures that will improve our cost structure."
Tomas Back Executive Vice President Atria Scandinavia
ATRIA RUSSIA produces and sells its products mainly in the St Petersburg and Moscow regions. The company's net sales in 2013 amounted to EUR 121.5 million and the company had 1,150 employees.
Atria Russia's own brands are Pit-Product and CampoMos. With a market share of approximately 20 per cent, Pit-Product is the market leader in its product groups in St Petersburg's consumer goods retail trade. CampoMos has a small market share in Moscow and St Petersburg.
• Europe's largest and fastest-growing consumer goods retail market. Th e market for processed meat in Moscow is worth around EUR 1.5 billion and the market in St Petersburg is worth over EUR 0.5 billion.
150
EUR mill.
Atria Russia's net sales decreased by EUR 4.8 million to EUR 121.5 million. However, net sales in roubles rose by 2.2%. Atria grew by maintaining its signifi cant market share in St Petersburg among the most important consumer goods retailers. Sales in Moscow were lower than the year before due to the elimination of several unprofi table product groups.
EBIT amounted to EUR -21.0 million due to major non-recurring items totalling EUR 17.4 million. EBIT without these items was EUR -3.6 million, showing an increase of EUR 5 million year-on-year. Operative EBIT improved owing to increased profi tability. Operative EBIT remained negative due to the unprofi tability of pork
production.
EBIT increased
Atria Russia discontinued its unprofi table pork production and decided to run down the Moscow plant and logistics centre by the end of 2014. As a result, the company recognised nonrecurring costs of EUR 25.0 million in total, of which EUR 17.4 million was allocated to EBIT.
-13%
Russia's GDP grew by only 1.3% instead of the projected 3.5%. This was mainly due to decelerating industrial growth rather than reduced consumption.1) Consumer purchasing power trends are of primary importance in the Russian consumer goods retail market, since food accounts for around 30% of consumer expenditure.2)
Total sales in the consumer goods retail market – in which the most signifi cant individual segment is foods and beverages – grew by 4%. Sales prices rose by an average of 6%. 1)
1) Sources: Rosstat, Bank of Finland, 2014
2) The corresponding proportions in Finland, Sweden and Denmark are in the region of 10% and in Estonia about 23%.
The market share of Atria Russia's product groups in St Petersburg's consumer goods retail chains is around 20%. The Pit-Product brand has been an established market leader in sausage product groups for more than 10 years. Its market share in St Petersburg is almost 50%.1) Several new players entered this growing market in 2013. Pit-Product focused its investments on new products, where price competition is less intense.
COMMERCIAL EXCELLENCE
Market share in Moscow
Atria's main brand in Moscow is CampoMos, whose growth has been slow due to the elimination of product groups. The brand's strongest product groups are convenience foods, such as pizzas, and frankfurters. In 2013, the company also successfully launched new cold cuts for large retail chains.
Although Atria Russia decided to discontinue production in Moscow, it will continue to systematically develop the CampoMos brand. Moscow and its suburbs have a population of around 15 million people, which is three times as large as that of St Petersburg. Besides Moscow, the CampoMos product groups are marketed in other cities.
Europe's largest food retail markets
| +100% | ||
|---|---|---|
Atria Russia continued to make signifi cant investments in expanding the Sibylla shop-in-shop concept. The number of outlets almost doubled between 2012 and 2013, and there are currently about 1,000 of them across Russia.
| Place | Country | Food retail market, USD bn |
|---|---|---|
| 1 | Russia | 314.1 |
| 2 | France | 283.7 |
| 3 | Germany | 271.1 |
| 4 | UK | 242.7 |
| 5 | Italy | 165.3 |
| 6 | Spain | 121.8 |
| 7 | Turkey | 87.0 |
| 8 | Switzerland | 59.6 |
| 9 | Poland | 48.6 |
| 10 | Belgium | 46.4 |
Source: IGD Datacentre, 2013
EFFICIENCY
The profi tability of Atria Russia's meat product operations has improved signifi cantly since 2011–2012, when production was streamlined and centralised to modern Gorelovo plant in St Petersburg. The Sinyavino plant in St Petersburg specialised in the production of cured sausages. Since 2013, these measures have generated cost savings of approximately EUR 9.5 million.
The discontinuation of pork production at Campofarm and the running down of the Campomos plant and logistics centre by the end of 2014 are estimated to generate annual savings of around EUR 6 million compared to 2013. These savings will be realised from the beginning of 2015.
When the decision to shut down the Campomos plant was made, it was also decided that pizza production would be transferred to the Gorelovo plant in St Petersburg. Machinery and equipment investments worth EUR 4.6 million will be made there.
The capacity of Atria Russia's Gorelovo plant is about 130 tonnes of meat products per day, and it is the most highly automated meat product plant in Russia. A logistics centre is located next to the plant. The plant's productivity has been boosted by an extensive Overall Equipment Effi ciency (OEE) programme, thanks to which personal productivity improved by more than 20% in 2013. The Gorelovo plant is also the only meat processing plant in Russia that has been awarded FSSC 22000 (Food Safety System Certifi cation).
Atria Russia's growth came to a halt in 2012 when the company eliminated a large number of its unprofi table products, particularly in the Moscow market. Are Atria's product groups and distribution channels ready for growth in 2014, Jarmo Lindholm?
Our main objective for 2014 is to achieve profi table growth. To this end, we will focus our eff orts on three growth segments: the cold cuts and convenience food product groups and the Sibylla business.
Th e cold cuts market in Russia is signifi cant in terms of its value, and it off ers good opportunities for growth. Th e market for fresh convenience food is undeveloped, but expanding it in collaboration with customers presents a huge opportunity. Th e eating habits of the growing middle class are rapidly changing, similarly to the rest of Europe. Our Sibylla business has grown strongly in recent years, and we expect this growth to continue.
Uncertain economic conditions and the potential weakening of the Russian rouble may lead to higher prices and reduce general consumer demand. Th is would also have a direct negative impact on Atria's growth. Another source of uncertainty is the changing restrictions for the import of meat, import duties and other regulations, which may cause temporary market disruptions.
Structurally speaking, yes. A basis for sustainable, positive performance does exist. However, I would like to point out that the positive impact of the cost benefi ts of the latest structural solutions will not be fully felt in our results until 2015.
Th e operations of the Gorelovo plant are currently effi cient, and as volumes grow, we will be able to put this production plant into full use and make it profi table.
Trends in the Russian economy and the consumer goods retail market create uncertainty regarding our performance. If these trends take a downward turn, this will have a direct impact on the consumption of our product groups. Th e percentage of income spent on
Jarmo Lindholm Executive Vice President Atria Russia
"The positive impact of the cost benefi ts of the latest structural solutions will not be fully felt in our results until 2015."
groceries in Russia is three times that spent in Finland, so there is a strong correlation between the consumption of our product groups and the country's economic development.
ATRIA BALTIC produces and markets its products mainly in Estonia. The company's net sales in 2013 amounted to EUR 32.9 million and the company had 320 employees. Atria is the second largest pork producer in Estonia.
Brands
Atria Baltic's own brands in Estonia are Maks & Moorits, VK and Wõro. In cold cuts and sausages, Atria has a market share of around 15 per cent.
Customers
• Industry
• Cold cuts • Fresh meat
• Consumer goods retail trade
Core product groups • Meat products,
particularly sausages
• Own pork production
Business environment
Atria Baltic's net sales decreased by EUR 1.3 million to EUR 32.9 million. This was mainly the result of Atria's decision to reduce the sale of unprocessed meat, such as whole carcasses. Their price has fallen due to pressure from cheap imported meat. During the summer barbecue season, Atria's sales rose and its market position strengthened.
EBIT increased by EUR 1.6 million to EUR 0.1 million with presenting 0.2% of net sales. Profi tability increased due to the modifi ed cost structure, achieved through effi ciency improvement measures, as well as a more favourable sales structure. Atria shifted its sales focus to products with a higher degree of processing.
Pork sales grew by 1.5% in Estonia and prices rose by 4%. The prices of cereals and feed stabilised towards the end of the year. Consumer purchasing power reduced more steeply and quickly than projected: the GDP growth rate was only 1%.1)
13.6%
Atria is the second largest company in the Estonian meat industry. Its market share in the Estonian consumer goods retail trade was 13.6% in terms of volumes.2)
Atria's market shares, %
| Product group | 2013 | 2012 |
|---|---|---|
| Cold cuts | 14.6 | 13.2 |
| Cooking sausages | 14.9 | 14.3 |
| Consumer-packed meat (fresh) |
6.0 | 6.6 |
| Consumer-packed meat (marinated) |
12.1 | 8.6 |
1) Sources: Statistics Estonia, Atria, 2013 2) Source: ACNielsen, 2013
Atria Baltic's EBIT has remained roughly the same for the last three years. Are there any changes in sight in the Estonian market or in Atria's sales that could return the company to growth, Olle Horm?
Accelerating growth in Estonia's current economic climate is very challenging. Economic growth slowed and practically came to a halt at the end of the year. Growth in meat market volumes is minimal and price competition is fi erce. Our position is weakened by cheap imported meat. Of course, we aim to boost our growth by consolidating our market position. We are focusing our eff orts on sales in the summer season, in which we were highly successful last year.
Last year was a year of changes. In addition to changes in and reductions of personnel, we transferred the operations of the Tartu warehouse to the main production plant in Valga and cut down the number of meat sales outlets. As a result of these measures, our cost structure became lighter. We also revised the sales structure. For example, we reduced the sale of pig carcasses and concentrated on products with a higher degree of processing. Nevertheless, pork production plays a key role in Atria's operations, since we are Estonia's second largest pork producer. Consequently, the prices of cereals and feed have a major impact on our performance.
Olle Horm Executive Vice President Atria Baltic
"Pork production plays a key role in Atria's operations, since we are Estonia's second largest pork producer."
Atria invested EUR 11.8 million in R&D to strengthen the position of its own brands in all markets.
Number of new products Atria launched 388 new products1). This was nearly 30 products more than in the previous year. Percentage-wise, the number of new products increased the most at Atria Russia, where it nearly doubled. Atria is engaged in a project to develop its product range management, R&D and marketing processes. The project is expected to produce successful results within two to three years. For additional information, see "Report by the Board of Directors", p. 34.
1) This fi gure includes new packages and new product support innovations.
| 2013 | 2012 | |||
|---|---|---|---|---|
| number | % of net sales | number | % of net sales | |
| Atria Finland | 160 | 10 | 130 | 6 |
| Atria Scandinavia | 118 | 1.6 | 136 | 2.4 |
| Atria Russia | 44 | 2.4 | 18 | 5 |
| Atria Baltic | 66 | 9.8 | 76 | 12.2 |
Atria's corporate responsibility policy is encapsulated in its mission, "Good food – better mood". For Atria, the concept of good food covers the entire food chain from primary production to the dining table. Atria's good food is produced in a responsible and ethical manner; it is safe, healthy and nutritious. Good food leads to a better mood and added value for all of Atria's stakeholders.
In accordance with the principles of sustainable development, Atria takes into account the economic, social and environmental aspects of its operations in all of its business areas.
Atria's corporate responsibility policy is embodied in its day-to-day work with stakeholders. Th e principal stakeholders include the following:
Other stakeholders include subcontractors, local communities, educational institutes and the media. Corporate responsibility programme sums up responsible operations
Atria has an extensive corporate responsibility programme called Atria's Handprint. Th e programme describes the principles, practices, projects and results of the company's responsible operations.
Atria develops responsible ways of working as part of its day-to-day management. Th e progress made is measured in seven priority areas, which are as follows:
By making improvements in all of these priority areas, Atria aims to become the number one company for responsible food production in its areas of operation.
During the year Atria had dozens of corporate responsibility development projects under way. Most of these were related to food safety and traceability. Also employee well-being development projects were dozens.
Atria has published a separate Corporate Responsibility Report, describing the key events, results and impacts in 2013. Atria uses the international Global Reporting Initiative (GRI) Guidelines as the basis for reporting, as applicable.
To read the report and learn more about other corporate responsibility matters at Atria, go to www.atriagroup.com/en/ corporateresponsibility.
To order a printed report, please contact Atria's Corporate Communications unit at [email protected] .
Distribution of economic value added by Atria
Net sales and other operating income EUR 1,417 million
Partners • Purchasing and other expenses EUR 1,154 million
Personnel • Salaries and benefi ts EUR 182 million
Society • Taxes and social security expenses EUR 60 million
| Invitation to the Annual General Meeting 30 | |
|---|---|
| Report by the Board of Directors 31 | |
| Atria Plc's shareholders and shares 42 | |
| Group key indicators 44 | |
| Atria Group's IFRS Financial Statement 2013 46 | |
| Notes to the consolidated Financial Statement50 | |
| Parent Company Financial Statement (FAS) 90 | |
| Notes to the parent company Financial Statements (FAS) 92 | |
| Signatures 97 | |
| Auditor's Report 98 | |
Atria Plc invites its shareholders to the Annual General Meeting, which will be held on Tuesday, 6 May 2014 in Helsinki at the Finlandia Hall.
The AGM will address the following matters, among others: 1. Matters to be addressed at the AGM as set out in Article 16 of the Articles of Association.
The invitation to the AGM is published in national newspapers on 21 March 2014. The AGM documents are available in Atria's website at www.atriagroup.com/en.
| 2013 Financial Statement 13 February 2014 | |
|---|---|
| 2013 Annual Report during week 13 | |
| Interim Report Q1 (3 months) 6 May 2014 | |
| Interim Report Q2 (6 months) 24 July 2014 | |
| Interim Report Q3 (9 months) 30 October 2014 | |
Atria's fi nancial information will be published in real time on the company website at www.atriagroup.com/en.
Atria's most signifi cant restructuring operations and development programmes according to the strategy were completed in 2013. Th ey have created a strong basis for the development and growth of Atria's operations and the improvement of its profi tability in the future.
With its strategy, Atria Group strives to improve profi tability, boost growth and increase the company's value. Atria aims to be the market leader or a strong number two in the Group's core operations, which include cold cuts and processed meat products.
Atria is also aiming at the top in local core operations, such as the poultry and convenience food industry, Atria Deli and Sibylla operations, selected Private Label product groups, consumer-packed meat, and slaughtering and cutting operations.
Atria will implement the strategy by developing the following three diff erent dimensions: commercial excellence, effi ciency and the way of work. Th e development areas are the same for all business areas.
Commercial excellence is a prerequisite to reach the top in the purchase decisions of consumers and customers, and it can be achieved by managing product groups under their guidance. Th e main objective of product group management is to increase the size of the market.
Being an industrial group, it is important to Atria that productivity, factory utilisation rates, raw material utilisation and operations management be in order. Operational effi ciency ensures profi tability.
Th e construction of a more harmonised and stronger Atria requires a common operational culture, values and principles. In 2013, Atria defi ned the Atria Way of Work, which was summarised into four main points:
Atria's corporate responsibility projects were taken forward in Atria's Handprint programme. At Atria Finland and Atria Scandinavia, the Handprint projects focus on the environment, animal welfare, product safety, nutrition, personnel and communications.
One of the most important development areas at Atria Finland was the provision of information about traceability all the way to the farm to consumers. Atria launched an extensive communications campaign, with a view to strengthening Atria brand image as a truly domestic. Th e campaign has focused on Finnish meat farmers and the importance of the origin of meat.
Atria Scandinavia's Handprint programme also focused on meat raw material traceability. Th e company continued to develop procedures related to meat procurement in order to verify the origin and traceability of meat.
At Atria Baltic, the focus has been on developing the nutritional content of products and special attention has been paid to reducing the amount of salt and fat. At Atria Russia, the Handprint programme has focused on developing personnel know-how, product safety management systems and product quality consistency.
In the accounting period, the Group had about 50 ongoing corporate responsibility projects, including the following: • Expansion of the product safety certifi cates for production plants
A separate corporate responsibility report was published as part of Atria's Handprint programme during the accounting period.
Atria Group's net sales for the year totalled EUR 1,411.0 million (EUR 1,343.6 million), up by EUR 67.4 million yearon-year. Due to non-recurring costs, consolidated EBIT weakened by EUR 10.5 million compared to the previous year, standing at EUR 19.7 million (EUR 30.2 million). EBIT without non-recurring items amounted to EUR 37.0 million (EUR 30.7 million).
Atria recognised EUR 25.0 million of non-recurring costs for its Russian operations, EUR 17.4 million of which was allocated to EBIT. An impairment of EUR 1.0 million was recognised for Atria Scandinavia's operations due to sold property. A non-recurring profi t of EUR 1.1 million resulting from the reversal of an impairment charge on property that had been for sale was recognised in Finland.
In March, Atria issued a fi xed-interest bond worth EUR 50 million. Th e funds were used for refi nancing and for the Group's general fi nancing needs. Th e loan period is fi ve years and a coupon rate of 4.375 per cent is payable on the loan. Th e bonds are publicly traded on the NASDAQ OMX Helsinki Ltd stock exchange.
Th e Group's free cash fl ow for the period under review (operating cash fl ow - cash fl ow from investments) was EUR 54.1 million (EUR 49.7 million), and net debt was EUR 305.9 million (EUR 363.9 million).
Atria Finland's net sales for the year totalled EUR 886.8 million (EUR 819.5 million), up by EUR 67.3 million yearon-year. EBIT amounted to EUR 32.9 million (EUR 36.5 million). EBIT includes a non-recurring profi t of EUR 1.1 million resulting from the reversal of an impairment charge on property that had been for sale in Forssa. Full-year net sales increased in all sales channels, and growth was particularly strong in the retail sector. EBIT was weighed down by deteriorating market conditions at the end of the year, the higher price of meat raw material compared to the previous year and persistently low export prices for meat.
Atria Scandinavia's net sales for the year totalled EUR 395.0 million (EUR 387.8 million), up by EUR 7.2 million yearon-year. In local currencies, net sales grew by 1.8 per cent year-on-year. EBIT amounted to EUR 12.2 million (EUR 8.2 million). EBIT includes non-recurring costs of EUR 1.0 million resulting from the impairment of the sold property. EBIT improved due to marketing eff orts at the beginning of the year and the improved sales structure towards the end of the year, along with more stable meat raw material prices.
Atria Russia's net sales for the year amounted to EUR 121.5 million (EUR 126.3 million). In the local currency, net sales grew by 2.2 per cent year-on-year. EBIT was EUR -21.0 million (EUR -8.6 million). Atria decided to discontinue primary production in Russia and industrial operations in Moscow, concentrating the latter in St Petersburg. As a result of these arrangements, Atria Russia recognised a total of EUR 25.0 million of non-recurring costs, EUR 17.4 million of which was allocated to EBIT and EUR 7.6 million to deferred tax assets. EBIT without non-recurring costs amounted to EUR -3.6 million (EUR -8.6 million). Th e results of industrial operations improved, but EBIT without non-recurring costs was negative due to the poor profi tability of primary production. It is estimated that the discontinuation of primary production and the Moscow-based production operations will generate annual cost savings of about EUR 6 million compared to 2013. Th e cost savings will be fully realised as of the beginning of 2015.
Atria Baltic's net sales for the year totalled EUR 32.9 million (EUR 34.2 million), representing a fall of EUR 1.3 million year-on-year. EBIT was EUR 0.1 million (EUR -1.5 million), up by EUR 1.6 million year-on-year. Th e positive performance was due to the improved sales structure and the cost savings resulting from effi ciency improvement measures.
| EUR million | 2013 | 2012 | 2011 |
|---|---|---|---|
| Net sales | 1,411.0 | 1,343.6 | 1,301.9 |
| EBIT | 19.7 | 30.2 | 8.0 |
| EBIT, % | 1.4 | 2.2 | 0.6 |
| Non-recurring items | -17.3 | -0.5 | -2.2 |
| Earnings per share, EUR | -0.15 | 0.35 | -0.24 |
| Balance sheet total | 978.1 | 1,041.6 | 1,067.5 |
| Return on equity, % | -1.0 | 2.4 | -1.5 |
| Return on investments, % | 3.7 | 4.7 | 1.7 |
| Equity ratio, % | 42.2 | 41.5 | 39.5 |
| Net gearing, % | 74.3 | 84.3 | 95.5 |
Atria Plc and Saarioinen Oy signed a preliminary agreement in July under which Atria will purchase Saarioinen's procurement, slaughtering and cutting operations for beef, pork and chicken. In conjunction with the deal, Atria and Saarioinen signed an agreement concerning meat deliveries from Atria to Saarioinen. Th e operations covered by the deal employ about 400 people on average. As a result of the deal, Atria's net sales are projected to grow by around EUR 70 million per year. On 21 January 2014, the Finnish Competition and Consumer Authority announced its approval of the acquisition. Th e operations were consolidated into Atria as of 1 February 2014. Th e purchase price was approximately EUR 30 million, and it was paid using cash funds and borrowed capital. Th e acquisition had no material eff ect on the Group's key fi gures.
Atria Plc's Board of Directors has announced that it will propose to the Annual General Meeting that the company's Articles of Association be amended so that the maximum number of members of the Board of Directors shall be increased by two. In the future, the Board of Directors will therefore consist of no fewer than fi ve and no more than nine members (the current maximum number of members is seven).
Provided that the General Meeting approves the Board of Directors' proposal for amendment, the Nomination Committee has decided to propose to the General Meeting that a total of eight members be elected to the Board of Directors instead of the current seven.
Th e Nomination Committee has decided to propose to the General Meeting that a member be elected to replace Seppo Paavola, who is due to resign, and that a new member be elected to the Board of Directors. Th e Nomination Committee has decided to propose to the General Meeting that Seppo Paavola, who is due to resign, be re-elected as a member of the Board of Directors and that Jukka Moisio be elected as a new member.
Th e Nomination Committee has decided to propose to the General Meeting that the remuneration of the members of the Board of Directors be kept at the same level as in 2013. Remuneration and compensation for meeting expenses were as follows:
Atria Group's research and development activities focus on researching consumer behaviour and market data in all of the Group's business areas. In addition, Atria participates in applied research in the areas of product and packaging technology and food science.
Atria Finland launched 160 new products in the consumer goods and Food Service markets in 2013. Th e most important new products were the Family Farm additive-free poultry products, oriental microwave products and summer grill products in general. Products traceable all the way to the farm, such as the Atria farm-labelled Christmas hams and the Atria Family Farm fi llet nuggets, also played a major role. Th ese new products accounted for about 10 per cent of total sales (retail and Food Service) in Finland.
Atria Scandinavia launched 118 new products across all product groups. Examples of successful launches:
In Sweden and Denmark, new products accounted for some 1.6 per cent of total sales.
Atria Russia's product portfolio increased by a total of 44 new products in 2013. Several new products were launched for the cold cuts and convenience foods of the Pit-Product and Campomos brands. Atria Russia's fi rst seasonal product family for smoked meat products was launched for Christmas. Th ese new products accounted for 2.4 per cent of total sales.
Atria Baltic launched 66 new products. Th e Maks and Moorits grill products and the VK Retro product family succeeded best. New products accounted for 9.8 per cent of total sales.
Proportion of net sales spent on research and development in Atria Group in 2011–2013:
| 2013 | 2012 | 2011 | |
|---|---|---|---|
| Research and development, EUR million | 11.8 | 12.0 | 11.9 |
| Share of net sales, % | 0.8 | 0.9 | 0.9 |
Slow economic growth and low infl ation in Europe have kept both short-term Euribor interest rates and long-term interest rates at historically low levels. Liquidity in the fi nancial markets remained good, loan periods normalised and, on average, there was no longer any pressure to increase corporate fi nancing margins. However, the diff erences in margins between diff erent companies grew due to the increasingly high importance of the companies' creditworthiness in the pricing of fi nancing. As in the previous year, large companies acquired extensive long-term fi nancing through bonds.
In March, Atria Plc issued a EUR 50 million bond with fi xed interest rate and a loan period of fi ve years. Th e funds were used to refi nance a EUR 40 million bond matured in July as well as for the Group's general fi nancing needs. During the past year, the company refi nanced committed credit limits amounting to EUR 140 million and reduced the amount of committed credit limits from EUR 240 million to EUR 190 million. New fi nancing agreements were used to secure a suffi ciently long average maturity for the loan portfolio. Short-term funding was acquired mainly through commercial papers. Th e Group's liquidity remained good; to ensure liquidity at all times, Atria had an average of EUR 168 million of unused committed credit lines during the year.
At the end of the accounting period (31 December 2013), fi xed interest debts accounted for 55.3% (49.8%) of the Group's liabilities.
Atria's business is exposed to a variety of external and internal risks, whose eff ects on the results may be negative or positive. Th e purpose of Atria's proactive risk management activities, implemented consistently across the Group, is to support the execution of Atria's strategy and the achievement of targets, as well as to secure business continuity if the risks are realised.
Atria's risk management operations are guided by the Risk Management Policy, which has been approved by the Board of Directors, and its harmonised operating models for risk assessment and reporting. Risk management is applied to identify, assess and manage factors that jeopardise the attainment of goals. A risk assessment in accordance with the risk management policy is implemented yearly in all business areas and Group operations. Th e signifi cance of a risk is assessed as a combination of the event's probability and fi nancial eff ect. Th e most signifi cant risks observed are prioritised throughout the Group and reported to the Board of Directors. Th e Management Teams of the business areas and the Group Management Team are responsible for implementing the required risk treatment actions in their respective areas of responsibility.
Th e profi tability of Atria's business is greatly aff ected by the global risk associated with changes in the market price of meat raw material. Th is risk is managed by means of centralised control of meat purchasing, raw material price variation clauses in sales contracts and proactive pricing of end products. Th e Group applies a uniform currency risk policy to hedge against currency risks relating to raw material procurement. Th e Group makes active use of currency derivatives, particularly in order to hedge foreign currency-denominated material purchases in Sweden against currency risks.
Products sold under the Atria brand in Finland are manufactured using only Finnish meat. Consequently, changes in the production volumes and availability of Finnish meat raw material may aff ect Atria Finland's profi tability in the long run. During the past year, Atria made signifi cant improvements to meat raw material procurement control in Finland.
In Atria Russia's operations, changing restrictions and import duties on meat and other regulations are characteristic of the market. To manage this risk, Atria Russia strives to raise the share of local suppliers. In the short term, the sharp weakening of the Russian rouble may lead to an increase in raw material prices. It is impossible for Atria to immediately pass on higher raw material costs to sales prices. Furthermore, rising prices may aff ect consumer demand.
Retail trade in the food industry is highly centralized in all of Atria's key markets, which creates opportunities to build diverse forms of cooperation over the long term. On the other hand, this increases dependence on individual customers. Atria's strong market position, effi cient industrial processes and well-known brands improve its negotiating position.
As a food manufacturing company, Atria's priority is to ensure the high quality and safety of raw materials and products throughout the production chain. Atria has modern methods in place to ensure the safety of production processes and to eliminate various microbiological, chemical and physical hazards. An animal disease discovered at a critical point in Atria's production chain could interrupt production in the unit concerned and disrupt the entire chain's operations. Internal monitoring involving multiple stages is applied to detect potential hazards as early as possible.
Th e economic downturn increases the risk of weakening liquidity and credit losses among Atria's customers. As a result of more effi cient credit control, no signifi cant credit losses were incurred. A signifi cant proportion of Atria's trade receivables in Finland are related to animal and feed trading in primary production. Th e profi tability of agricultural production and producers' liquidity may be reduced especially by sharp changes in the price of meat and inputs and changes in the agricultural subsidy programs.
Signifi cant changes in energy costs, such as electricity and gas prices, may aff ect Atria's profi tability. Atria uses derivatives to hedge against unfavourable changes in accordance with its hedging policy.
Low temperatures and repetitive movements are characteristic of work performed within the food industry. Th e work is often physically demanding and requires the use of cutting machines and tools, which increases the risk of accidents at work. Atria aims to prevent occupational accidents, disease risks and related costs by investing signifi cantly in safety at work and the continuous improvement of work methods and tools.
Atria has 17 production plants in Finland, Sweden, Denmark, Estonia and Russia. All of these are insured against material damage and business interruptions through the Group's insurance programmes. Eff orts are made to manage risks that threaten operational continuity also through continuity planning.
Atria manages its fi nancial risks in accordance with the treasury policy approved by the Board of Directors. Th e Board of Directors has delegated the application and implementation of the fi nancing policy and the management of fi nancing risks to the Group's Treasury unit, which consists of the CEO, CFO, Director of Atria Scandinavia, Group Controller and Treasurer. Th e practical management of fi nancial risks is the responsibility of the Group's Treasury. Th e aim of the Group's fi nancial risk management is to reduce the eff ect on earnings, the balance sheet and cash fl ow due to price fl uctuations on the fi nancial markets and other uncertainty factors, and to ensure suffi cient liquidity. Th e main risks related to fi nancing are interest rate risk, currency risk, liquidity and refi nancing risk and credit risk. Atria's fi nancial risk management is discussed in more detail in the notes to the fi nancial statements in note 28.
Th e General Meeting decided that the composition of Atria Plc's Supervisory Board shall be as follows:
Furthermore, the following changes were made to the composition of the Supervisory Board during the current terms:
In its constitutive meeting following the General Meeting, Atria Plc's Supervisory Board elected Hannu Hyry as its Chairman and re-elected Juho Anttikoski as its Deputy Chairman.
Th e General Meeting decided that the Board of Directors will consist of seven members.
Timo Komulainen and Maisa Romanainen, who were due to resign, were re-elected. Board member Tuomo Heikkilä announced that he will no longer be available as a member. Jyrki Rantsi was elected as a new member to replace him for a term ending at the closing of the third Annual General Meeting following the election. Furthermore, Seppo Paavola, Esa Kaarto, Harri Sivula and Kjell-Göran Paxal shall continue as members.
In its constitutive meeting following the General Meeting, Atria Plc's Board of Directors re-elected Seppo Paavola as its Chairman and Timo Komulainen as its Deputy Chairman.
Atria Plc's Board of Directors now has the following composition: Chairman of the Board: Seppo Paavola; Deputy Chairman: Timo Komulainen; members: Esa Kaarto, Kjell-Göran Paxal, Maisa Romanainen, Harri Sivula and Jyrki Rantsi.
Th e members of the Management Team report to CEO Juha Gröhn.
Atria Plc's governance is described in more detail in a separate document: "Corporate Governance Statement".
Th e following people were elected to Atria Plc's Nomination Committee, appointed by the General Meeting:
Th e Nomination Committee elected Juho Anttikoski as Chairman from among its members.
| 2013 | 2012 | 2011 | |
|---|---|---|---|
| Atria Finland | 2,146 | 2,048 | 2,113 |
| Atria Scandinavia | 1,050 | 1,119 | 1,153 |
| Atria Russia | 1,151 | 1,384 | 1,812 |
| Atria Baltic | 322 | 347 | 389 |
| Group total | 4,669 | 4,898 | 5,467 |
| Salaries and benefi ts for the period, | |||
| Group total (EUR million) | 182.1 | 182.7 | 181.8 |
Atria's long-term incentive plan has three 12-month periods: 2012, 2013 and 2014. Th e earning period for the plan ends on 31 December 2014. Th e compensation earned in an earning period is determined after the period is over based on progress against set targets. Th e plan off ers an opportunity to earn cash rewards for reaching targets established for the relevant earning period. Any profi t from the plan is based on the Group's earnings per share (EPS). Th e plan covers approximately 40 of Atria Group's key personnel.
Th e maximum amount of merit pay for Atria Plc's CEO and the Management Team is 35%–50% of the annual salary, depending on the eff ect on the results and the level of competence required to perform the duties. Th e criteria in Atria Plc's merit pay scheme are the performance requirements and working capital at Group level and in the area of responsibility of the person concerned. In addition to the CEO, Deputy CEO and Management Team, Atria Plc's merit pay scheme covers approximately 40 Group executives.
Th e well-being of the environment is essential to the operations of Atria and the food industry as a whole.
Th e key environmental aspects that Atria can infl uence through its operations are energy and water consumption, wastewater load and waste prevention. Transport and primary production have a signifi cant indirect impact on the environment. We are well aware of the environmental impacts of primary production. Th erefore, we encourage primary production operators to engage in eco-effi cient operations and to commit to the conditions of the EU environmental subsidies. As regards transport, we monitor fuel consumption and the European emission standards for vehicles, which indicate the level of hazardous emissions released by the engine.
Environmental management at Atria is based on environmental legislation and the fulfi lment of stakeholder expectations. Environmental management at Atria Finland and, to some extent, at Atria Scandinavia is based on an environmental management system certifi ed in compliance with the ISO 14001 standard. In other business areas, the company strives to achieve a corresponding level of environmental management. Environmental solutions are developed in collaboration with local environmental groups and through networking with the best experts in the area. In Finland, Atria has a representative on the Environmental Committee of the Finnish Food and Drink Industries' Federation.
| Goals 2012–2014 | Results 2013 |
|---|---|
| • Managing direct environmental impacts. • Identifying environmental impacts throug hout the production chain and promoting eco-effi ciency. |
• Enhanced consumption of utilities in propor tion to production. At Atria Finland, energy effi ciency improved by 8%. |
In the food industry, energy is needed to heat and cool premises, for production-related heating and cooling processes and to maintain material fl ows and the cold chain. In the period under review, total energy consumption decreased by three per cent and consumption in relation to the kilograms produced decreased by eight per cent.
Th e food industry uses large amounts of water, partly to uphold production hygiene. In addition to frequent washing of premises, water is also needed as a processing aid, for instance, in product cooling. Atria Finland's water consumption increased by eight per cent in the period under review. In the other business areas of the Group, water consumption remained stable.
Atria strives to minimise the environmental impact of groundwater consumption in cooperation with local utilities by increasing the use of surface water as needed and by levelling off consumption peaks using a variety of technical solutions.
Th e volume of wastewater generated by Atria corresponds to its water consumption. At the larger production sites, Atria pre-treats its effl uents before fl ushing them into the municipal sewage network. Plant-specifi c environmental permits determine the target values for wastewater quality. Th e plants monitor compliance with the target values carefully. Th e BOD7 load of Atria Finland's effl uents increased slightly in the period under review. As BOD7 values are not measured in the Atria Scandinavia and Atria Estonia business areas, their load has been estimated in reporting on the basis of loads generated by similar facilities.
Th e by-products of food production are carefully utilised. About 98 per cent of the by-products of Atria's core operations are channelled to reuse. Th e market price of raw materials and local infrastructure play a key role in the eventual destination of by-products. Th e prevention of waste generated in the product lifecycle is greatly infl uenced by the choice of packaging.
Atria Finland's environmental management is handled by a steering group that works under the Management Team and is in charge of planning and monitoring environmental management. Th e steering group has representatives from production, product and packaging development and support. Th e composition of the group ensures that management encompasses all of the areas in which Atria can control its environmental impact. Th e group addresses changes in legislation and stakeholder groups, analyses the results achieved in the previous year, discusses the investments required and sets targets for the upcoming period.
Th e key objective in the environmental strategy period is to support business through a controlled use of natural resources. Th e objectives have been adapted to fi t changes in the business environment, of which the most signifi cant continue to be the advancement of energy effi ciency and the prevention of waste generation.
In 2013, consolidated EBIT without non-recurring costs was EUR 37.0 million. In 2014, it is projected to be higher. Net sales are expected to grow in 2014.
Atria Plc did not receive any fl agging notifi cations in 2013.
Th e breakdown of the parent company's share capital is as follows: Series A shares (1 vote/share) 19,063,747 pcs Series KII shares (10 vote/share) 9,203,981 pcs
Series A shares have preference for a dividend of €0.17, after which Series KII shares are paid a dividend of up to €0.17. If dividend funds remain after this, Series A and Series KII shares entitle their holders to an equal right to a dividend.
Atria's Articles of Association include a pre-emptive purchase clause concerning KII shares. If Series KII shares are transferred to a party outside the company or to a shareholder within the company who has not previously owned Series KII shares, the proposed recipient of the shares must inform the Board of Directors without delay, and Series KII shareholders have the right to pre-emptively purchase the shares under certain conditions. In addition, the acquisition of Series KII shares by means of transfer requires approval by the company. Series A shares have no such limitations.
Information on shareholding distribution, shareholders and management holdings can be found under the heading "Atria Plc's shareholders and shares".
Th e General Meeting authorised the Board of Directors to decide, on one or several occasions, on the acquisition of a maximum of 2,800,000 of the company's own A shares with funds belonging to the company's unrestricted equity, subject to the provisions of the Limited Liability Companies Act regarding the maximum number of treasury shares to be held by a company. Th e company's own A shares may be acquired for use as consideration in any acquisitions or other arrangements relating to the company's business, to fi nance investments, as part of the company's incentive scheme, to develop the company's capital structure, to be otherwise further transferred, to be retained by the company or to be cancelled.
Th e shares shall be acquired in a proportion other than that of the shareholders' current shareholdings in the company in public trading arranged by NASDAQ OMX Helsinki Ltd, at the trading price at the moment of acquisition. Th e shares shall be acquired and paid for in accordance with the rules of NASDAQ OMX Helsinki Ltd and Euroclear Finland Oy. Th e Board of Directors is authorised to decide on the acquisition of treasury shares in all other respects.
Th e authorisation shall supersede the authorisation granted by the Annual General Meeting on 3 May 2012 to the Board of Directors to decide on the acquisition of the company's own shares and be valid until the closing of the next Annual General Meeting or until 30 June 2014, whichever is fi rst.
Th e General Meeting authorised the Board of Directors to decide, on one or several occasions, on an issue of a maximum of 12,800,000 new A shares or on an issue of any A shares held by the company through a share issue and/or by granting option rights or other special rights entitling holders to shares as referred to in Chapter 10, section 1 of the Finnish Limited Liability Companies Act. Th e authorisation may be exercised to fi nance or execute any acquisitions or other arrangements or investments related to the company's business, to implement the company's incentive plan or for other purposes subject to the Board's decision.
Th e Board of Directors is also authorised to decide on all terms and conditions of the share issue and of the granting of special rights as referred to in Chapter 10, section 1 of the Limited Liability Companies Act. Th e authorisation thus also includes the right to issue shares in a proportion other than that currently held by the shareholders under the conditions provided by law, the right to issue shares against or without payment and the right to decide on a share issue to the company itself without payment – subject to the provisions of the Limited Liability Companies Act regarding the maximum number of treasury shares to be held by a company.
Th e authorisation shall supersede the share issue authorisation granted by the Annual General Meeting on 3 May 2012 to the Board of Directors and be valid until the closing of the next Annual General Meeting or until 30 June 2014, whichever is fi rst.
Th e parent company's shareholders' equity on 31 December 2013 comprises the invested unrestricted equity fund of EUR 110,227,500.00, treasury share fund of EUR -1,277,443.82 and profi ts of EUR 64,694,512.06, of which loss for the period totals EUR 24,107,481.28.
| Th e Board of Directors proposes to the General Meeting that retained earnings be used as follows: | |
|---|---|
| • A dividend of EUR 0.22/share be paid, totalling EUR | 6,194,411.52 |
| • To be retained as shareholders' equity, EUR | 58,500,100.54 |
| 64,694,512.06 |
No signifi cant changes have occurred in the company's fi nancial position since the end of the accounting period. Th e company's liquidity is good and, according to the Board of Directors, the proposed dividend does not compromise the company's solvency.
| Number of shares | Shareholders | Shares | |||
|---|---|---|---|---|---|
| Number | % | 1,000 shares | % | ||
| 1–100 | 5,005 | 40.74 | 257 | 0.91 | |
| 101–1,000 | 6,058 | 49.31 | 2,305 | 8.15 | |
| 1,001–10,000 | 1,128 | 9.18 | 2,789 | 9.87 | |
| 10,001–100,000 | 79 | 0.64 | 2,246 | 7.94 | |
| 100,001–500,000 | 10 | 0.08 | 2,265 | 8.01 | |
| 500,001–1,000,000 | 3 | 0.02 | 2,096 | 7.41 | |
| 1,000,001–999,999,999,999 | 2 | 0.02 | 16,311 | 57.70 | |
| Total | 12,285 | 100.00 | 28,268 | 100.00 |
| Business sector | Shareholders | Shares | ||
|---|---|---|---|---|
| Number | % | 1,000 shares | % | |
| Companies | 507 | 4.13 | 18,543 | 65.60 |
| Financial and insurance institutions | 39 | 0.32 | 1,198 | 4.24 |
| Public corporations | 10 | 0.08 | 1,270 | 4.49 |
| Non-profi t organisations | 101 | 0.82 | 430 | 1.52 |
| Households | 11,603 | 94.45 | 6,027 | 21.32 |
| Foreign owners | 25 | 0.20 | 27 | 0.10 |
| Total | 12,285 | 100.00 | 27,495 | 97.27 |
| Nominee-registered, total | 8 | 773 | 2.73 |
| Major shareholders, 31 Dec 2013 | KII | A | Total | % |
|---|---|---|---|---|
| Itikka Co-operative | 4,914,281 | 3,537,652 | 8,451,933 | 29.90 |
| Lihakunta | 4,020,200 | 3,838,797 | 7,858,997 | 27.80 |
| Mandatum Life | 821,562 | 821,562 | 2.91 | |
| Pohjanmaan Liha Co-operative | 269,500 | 480,038 | 749,538 | 2.65 |
| Varma Mutual Pension Insurance Company | 524,640 | 524,640 | 1.86 | |
| Veritas Pension Insurance Company | 425,000 | 425,000 | 1.50 | |
| Kuisla Reima | 285,117 | 285,117 | 1.01 | |
| Sijoitusrahasto Taalerintehdas Arvo Markka Osake | 180,000 | 180,000 | 0.64 | |
| Norvestia Oyj | 147,672 | 147,672 | 0.52 | |
| Mutual Insurance Company Pension Fennia | 126,289 | 126,289 | 0.45 | |
| Major shareholders by voting rights, 31 Dec 2013 | KII | A | Total | % |
| Itikka Co-operative | 49,142,810 | 3,537,652 | 52,680,462 | 47.42 |
| Lihakunta | 40,202,000 | 3,838,797 | 44,040,797 | 39.64 |
| Pohjanmaan Liha Co-operative | 2,695,000 | 480,038 | 3,175,038 | 2.86 |
| Mandatum Life | 821,562 | 821,562 | 0.74 | |
| Varma Mutual Pension Insurance Company | 524,640 | 524,640 | 0.47 | |
| Veritas Pension Insurance Company | 425,000 | 425,000 | 0.38 | |
| Kuisla Reima | 285,117 | 285,117 | 0.26 | |
| Sijoitusrahasto Taalerintehdas Arvo Markka Osake | 180,000 | 180,000 | 0.16 | |
| Norvestia Oyj | 147,672 | 147,672 | 0.13 | |
| Mutual Insurance Company Pension Fennia | 126,289 | 126,289 | 0.11 |
Holdings by the members of the Board of Directors and the Supervisory Board, the CEO and Deputy CEO and the members of the Group Management Team amounted to 67,598 series A shares on 31 December 2013, representing 0.24% of the shares and 0.06% of the voting rights conferred by them.
| Month | Trading, EUR | Trading, no. | Monthly low | Monthly high |
|---|---|---|---|---|
| January | 3,941,915 | 556,307 | 6.32 | 7.64 |
| February | 3,303,110 | 467,293 | 6.61 | 7.47 |
| March | 1,041,229 | 153,534 | 6.55 | 6.93 |
| April | 1,362,287 | 203,783 | 6.37 | 6.98 |
| May | 1,268,798 | 195,165 | 6.21 | 6.68 |
| June | 1,072,908 | 172,676 | 6.01 | 6.40 |
| July | 922,162 | 137,931 | 6.12 | 7.11 |
| August | 2,648,220 | 363,441 | 6.78 | 7.69 |
| September | 1,593,390 | 199,807 | 7.60 | 8.39 |
| October | 2,620,296 | 333,931 | 7.23 | 8.25 |
| November | 1,723,236 | 214,922 | 7.80 | 8.20 |
| December | 1,742,912 | 224,161 | 7.50 | 8.12 |
| Total | 23,240,462 | 3,222,951 |
| EUR million | 31 Dec 2013 | 31 Dec 2012 | 31 Dec 2011 | 31 Dec 2010 | 31 Dec 2009 |
|---|---|---|---|---|---|
| Net sales | 1,411.0 | 1,343.6 | 1,301.9 | 1,300.9 | 1,316.0 |
| EBIT | 19.7 | 30.2 | 8.0 | 9.8 | 27.5 |
| % of net sales | 1.4 | 2.2 | 0.6 | 0.8 | 2.1 |
| Financial income and expenses | -15.2 | -14.7 | -14.1 | -11.1 | -12.4 |
| % of net sales | -1.1 | -1.1 | -1.1 | -0.9 | -0.9 |
| Profi t before taxes | 6.9 | 18.9 | -4.7 | 0.3 | 16.5 |
| % of net sales | 0.5 | 1.4 | -0.4 | 0.0 | 1.3 |
| Return on equity (ROE), % | -1.0 | 2.4 | -1.5 | -1.0 | 1.7 |
| Return on investment (ROI), % | 3.7 | 4.7 | 1.7 | 1.9 | 4.7 |
| Equity ratio, % | 42.2 | 41.5 | 39.5 | 40.2 | 39.7 |
| Interest-bearing liabilities | 334.7 | 370.5 | 409.4 | 429.9 | 425.8 |
| Gearing, % | 81.3 | 85.9 | 97.1 | 96.4 | 97.5 |
| Net gearing, % | 74.3 | 84.3 | 95.5 | 92.2 | 89.4 |
| Gross investments in fi xed assets | 41.1 | 56.2 | 47.0 | 46.2 | 33.0 |
| % of net sales | 2.9 | 4.2 | 3.6 | 3.5 | 2.5 |
| Average number of personnel | 4,669 | 4,898 | 5,467 | 5,812 | 6,214 |
| Research and development costs | 11.8 | 12.0 | 11.9 | 10.3 | 9.4 |
| % of net sales * | 0.8 | 0.9 | 0.9 | 0.8 | 0.7 |
| Order stock** | - | - | - | - | - |
* Booked in total as expenditure for the fi nancial year
** Not a signifi cant indicator as orders are generally delivered on the day following the order being placed
| EUR million | 31 Dec 2013 | 31 Dec 2012 | 31 Dec 2011 | 31 Dec 2010 | 31 Dec 2009 | |
|---|---|---|---|---|---|---|
| Earnings per share (EPS), EUR | -0.15 | 0.35 | -0.24 | -0.18 | 0.25 | |
| Equity/share, EUR | 14.45 | 15.15 | 14.81 | 15.68 | 15.39 | |
| Dividend/share, EUR * | 0.22 | 0.22 | 0.20 | 0.25 | 0.25 | |
| Dividend/profi t, %* | -142.8 | 63.1 | -84.5 | -138.9 | 99.5 | |
| Effective dividend yield * | 2.8 | 3.5 | 3.4 | 2.8 | 2.3 | |
| Price/earnings (P/E) | -50.2 | 17.9 | -25.1 | -50.0 | 44.0 | |
| Market capitalisation | 218.5 | 177.0 | 168.2 | 254.4 | 312.6 | |
| Share turnover/1,000 shares | A | 3,223 | 3,460 | 5,094 | 9,702 | 7,389 |
| Share turnover, % | A | 16.9 | 18.1 | 26.7 | 50.9 | 38.8 |
| Total number of shares, million | 28.3 | 28.3 | 28.3 | 28.3 | 28.3 | |
| Number of shares | A | 19.1 | 19.1 | 19.1 | 19.1 | 19.1 |
| KII | 9.2 | 9.2 | 9.2 | 9.2 | 9.2 | |
| Average share issue-adjusted number of shares |
28.3 | 28.3 | 28.3 | 28.3 | 28.3 | |
| Share issue-adjusted number | ||||||
| of shares on 31 Dec | 28.3 | 28.3 | 28.3 | 28.3 | 28.3 | |
| Share price development, EUR | ||||||
| Lowest of the period | A | 6.01 | 4.76 | 4.99 | 8.74 | 6.50 |
| Highest of the period | A | 8.39 | 7.08 | 9.15 | 13.48 | 13.00 |
| At end of the period | A | 7.73 | 6.26 | 5.95 | 9.00 | 11.06 |
| Average price during the period | A | 7.21 | 5.89 | 7.21 | 10.93 | 10.76 |
* The Board of Directors' proposal
| Profi t/loss for the period | ||
|---|---|---|
| Return on equity (%) | = Equity (average for the period) |
100 * |
| Profi t/loss before tax + interest and other fi nancial expenses = |
||
| Return on investment (%) | Equity + interest-bearing fi nancial liabilities (average) | 100 * |
| Equity ratio (%) | Equity = |
100 * |
| Balance sheet total - advance payments received | ||
| Gearing (%) | Interest-bearing fi nancial liabilities = |
* 100 |
| Equity | ||
| Net gearing (%) | Interest-bearing fi nancial liabilities - cash and cash equivalents = |
* 100 |
| Equity | ||
| Profi t/loss for the period attributable to the owners of the parent company = |
||
| Earnings per share (basic) | Weighted average of outstanding shares | |
| Equity attributable to the owners of the parent company | ||
| Equity/share | = Undiluted number of shares on 31 Dec |
|
| Dividend distribution during the period | ||
| Dividend per share | = Undiluted number of shares on 31 Dec |
|
| Dividend/share | ||
| Dividend/profi t (%) | = Earnings per share (EPS) |
100 * |
| Dividend/share | ||
| Effective dividend yield (%) | = Closing price at the end of the period |
100 * |
| Closing price at the end of the period | ||
| Price/earnings (P/E) | = Earnings per share |
|
| Overall share turnover in euro | ||
| Average price | = Undiluted average number of shares traded during the period |
|
| Market capitalisation | = Number of shares at the end of the period * closing price on 31 Dec |
|
| Share turnover (%) | Number of shares traded during the period = Undiluted average number of shares |
100 * |
| Consolidated income statement | |
|---|---|
| ------------------------------- | -- |
| EUR 1,000 | Note | 1 Jan-31 Dec 2013 | 1 Jan-31 Dec 2012 |
|---|---|---|---|
| Net sales | 1, 2 | 1,411,015 | 1,343,580 |
| Costs of goods sold | 7, 8 | -1,237,136 | -1,172,519 |
| Gross margin | 173,879 | 171,061 | |
| Sales and marketing expenses | 3, 7, 8 | -98,224 | -95,881 |
| Administrative expenses | 4, 7, 8 | -43,485 | -44,157 |
| Other operating income | 5 | 6,144 | 3,811 |
| Other operating expenses | 6 | -18,584 | -4,624 |
| EBIT | 1 | 19,730 | 30,210 |
| Financial income | 9 | 14,738 | 14,631 |
| Financial expenses | 9 | -29,941 | -29,329 |
| Net fi nancial items | -15,203 | -14,698 | |
| Income from joint ventures and associates | 15 | 2,335 | 3,395 |
| Profi t/loss before taxes | 6,862 | 18,907 | |
| Income taxes | 10, 18 | -11,152 | -8,842 |
| Profi t for the year | -4,290 | 10,065 | |
| Income distribution for the accounting period: | |||
| To parent company owners | -4,338 | 9,823 | |
| To non-controlling owners | 48 | 242 | |
| Total | -4,290 | 10,065 | |
| Basic earnings per share, EUR | 11 | -0.15 | 0.35 |
| Diluted earnings per share, EUR | 11 | -0.15 | 0.35 |
| EUR 1,000 | Note | 1 Jan-31 Dec 2013 | 1 Jan-31 Dec 2012 |
|---|---|---|---|
| Profi t for the year | -4,290 | 10,065 | |
| Other items of the total comprehensive income after tax: | |||
| Items that will not be reclassifi ed to profi t or loss | |||
| Actuarial gains/losses from benefi t-based pension obligations | 10, 26 | 861 | -408 |
| Items reclassifi ed to profi t or loss when specifi c conditions are met | |||
| Financial assets available for sale | 9, 10, 16, 28 | 37 | 6 |
| Cash fl ow hedge | 9, 10, 28 | 1,467 | -1,222 |
| Transition differences | 9 | -11,609 | 6,937 |
| Total comprehensive income for the year | -13,534 | 15,378 | |
| Comprehensive income distribution for the fi nancial period: | |||
| To parent company owners | -13,512 | 15,063 | |
| To non-controlling owners | -22 | 315 | |
| Total | -13,534 | 15,378 |
| Assets, EUR 1,000 | Note | 31 Dec 2013 | 31 Dec 2012 |
|---|---|---|---|
| Non-current assets | |||
| Property, plant and equipment | 1, 12 | 433,526 | 476,065 |
| Biological assets | 13 | 775 | 1,464 |
| Goodwill | 14 | 164,756 | 168,502 |
| Other intangible assets | 14 | 76,980 | 78,446 |
| Investments in joint ventures and associates | 15, 32 | 15,299 | 14,640 |
| Other fi nancial assets | 16, 28 | 2,189 | 1,748 |
| Trade receivables, loans and other receivables | 17, 28 | 7,494 | 11,636 |
| Deferred tax assets | 10, 18 | 4,890 | 15,487 |
| Total | 705,909 | 767,988 | |
| Current assets | |||
| Inventories | 19 | 114,134 | 114,268 |
| Biological assets | 13 | 3,345 | 5,504 |
| Trade and other receivables | 20, 28 | 113,941 | 140,047 |
| Current tax assets | 4,865 | 4,758 | |
| Cash and cash equivalents | 21, 28 | 28,844 | 6,556 |
| Total | 265,129 | 271,133 | |
| Non-current assets held for sale | 22 | 7,017 | 2,507 |
| Total assets | 1 | 978,055 | 1,041,628 |
| Equity and liabilities, EUR 1,000 | Note | 31 Dec 2013 | 31 Dec 2012 |
| Equity attributable to the shareholders of the parent company | |||
| Share capital | 48,055 | 48,055 | |
| Share premium | 138,502 | 138,502 | |
| Treasury shares | -1,277 | -1,277 | |
| Other funds | -4,123 | -5,627 | |
| Invested unrestricted equity fund | 110,571 | 110,571 | |
| Translation differences | -21,868 | -10,328 | |
| Retained earnings | 138,639 | 148,311 | |
| Total | 10, 11, 18, 23, 28 | 408,499 | 428,207 |
| Non-controlling owners' share | 3,219 | 3,240 | |
| Equity total | 411,718 | 431,447 | |
| Non-current liabilities | |||
| Interest-bearing fi nancial liabilities | 24, 28 | 215,839 | 264,337 |
| Deferred tax liabilities | 10, 18 | 44,697 | 47,364 |
| Other liabilities | 25, 28 | 5,730 | 7,572 |
| Pension obligations | 26 | 6,926 | 8,132 |
| Total | 273,192 | 327,405 | |
| Current liabilities | |||
| Interest-bearing fi nancial liabilities | 24, 28 | 118,894 | 106,142 |
| Trade and other payables | 27, 28 | 174,240 | 175,498 |
| Current tax liabilities | 11 | 1,136 | |
| Total | 293,145 | 282,776 | |
| Total liabilities | 566,337 | 610,181 | |
| 1 | |||
| Equity and liabilities, total | 978,055 | 1,041,628 |
| Equity attributable to the owners of the parent company | Share of non control ling interests |
Total equity |
|||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| EUR 1,000 | Note | Share capital |
Share premium |
Treasury shares |
Other funds |
Invested unre stricted equity fund |
Transla tion dif ferences |
Retained earnings |
Total | ||
| Equity on 1 Jan 2012 | 48,055 | 138,502 | -1,277 | -4,406 | 110,571 | -17,192 | 144,528 | 418,781 | 2,920 | 421,701 | |
| Total comprehensive income for the year Profi t for the year Other items of the total comprehensive income |
9,823 | 9,823 | 242 | 10,065 | |||||||
| Financial assets available for sale Cash fl ow hedge |
6 -1,222 |
6 -1,222 |
6 -1,222 |
||||||||
| Actuarial losses from pension benefi ts Translation differences |
26 | -5 | 6,864 | -408 | -408 6,859 |
78 | -408 6,937 |
||||
| Transactions with owners Treasury shares Distribution of dividends |
23 23 |
-5,632 | 0 -5,632 |
0 -5,632 |
|||||||
| Equity on 31 Dec 2012 | 48,055 | 138,502 | -1,277 | -5,627 | 110,571 | -10,328 | 148,311 | 428,207 | 3,240 | 431,447 | |
| Total comprehensive income for the year |
|||||||||||
| Profi t for the year Other items of the total comprehensive income |
-4,338 | -4,338 | 48 | -4,290 | |||||||
| Financial assets available for sale Cash fl ow hedge |
37 1,467 |
37 1,467 |
37 1,467 |
||||||||
| Actuarial gains from pension benefi ts Translation differences |
26 | -11,540 | 861 | 861 -11,540 |
-69 | 861 -11,609 |
|||||
| Transactions with owners Treasury shares Distribution of dividends |
23 23 |
-6,195 | 0 -6,195 |
0 -6,195 |
|||||||
| Equity on 31 Dec 2013 | 48,055 | 138,502 | -1,277 | -4,123 | 110,571 | -21,868 | 138,639 | 408,499 | 3,219 | 411,718 |
| EUR 1,000 | Note | 1 Jan-31 Dec 2013 | 1 Jan-31 Dec 2012 |
|---|---|---|---|
| Cash fl ow from operating activities | |||
| Sales income | 1,431,225 | 1,387,809 | |
| Payments received from other operating revenue | 2,473 | 2,078 | |
| Payments on operating expenses | -1,323,053 | -1,270,714 | |
| Interest paid and payments on other operating expenses | -31,271 | -30,308 | |
| Dividends received | 83 | 82 | |
| Interest payments received and other fi nancial income | 14,544 | 14,548 | |
| Direct taxes paid | -5,091 | -3,888 | |
| Cash fl ow from operating activities | 88,910 | 99,607 | |
| Cash fl ow from investments | |||
| Investments in tangible and intangible assets | -38,683 | -50,382 | |
| Acquisition of subsidiaries, net of cash acquired | 32 | -1,828 | |
| Sold associated companies | 1,593 | ||
| Acquired associated companies | -961 | ||
| Decrease in long-term loan receivables | 2,051 | 850 | |
| Other investments | 1,177 | 1,415 | |
| Cash fl ow from investments | -34,823 | -49,945 | |
| Cash fl ow from fi nancing | |||
| Draw down of long-term loans | 50,000 | 50,000 | |
| Repayment of long-term loans | -62,295 | -39,599 | |
| Draw down and repayment of short-term loans | -12,974 | -55,014 | |
| Dividends paid | 23 | -6,195 | -5,632 |
| Cash fl ow from fi nancing | -31,464 | -50,245 | |
| Change in cash and cash equivalents | 22,623 | -583 | |
| Cash and cash equivalents at the start of the accounting period | 21 | 6,556 | 6,618 |
| Effect of exchange rate changes | -335 | 521 | |
| Cash and cash equivalents at end of fi nancial period | 28,844 | 6,556 |
Th e parent company of the Atria Group, Atria Plc, is a Finnish public company formed in accordance with Finnish law and domiciled in Kuopio, Finland. Th e company has been listed on Nasdaq OMX Helsinki Ltd since 1991. Copies of the consolidated fi nancial statements are available online at www.atriagroup.com or from the parent company's head offi ce at Itikanmäenkatu 3, Seinäjoki; postal address: P.O. Box 900, FI-60060 ATRIA.
Atria Plc and its subsidiaries manufacture and market food products, especially meat products, poultry products, meals and food concepts. Atria has established Finland, Sweden, Denmark, European Russia and the Baltic countries as its market area. Atria's subsidiaries are also located in this area. Th e Group's operations are divided into four business areas: Atria Finland, Atria Scandinavia, Atria Russia and Atria Baltic.
Th e fi nancial statements were approved by the Board of Directors for publication on 12 February 2014. According to the Finnish Companies Act, the shareholders are entitled to approve or reject the fi nancial statements in the Annual General Meeting to be held after their publication. Th e AGM can also make a decision to revise the fi nancial statements.
Th e consolidated fi nancial statements have been prepared in accordance with the International Financial Reporting Standards (IFRS) endorsed by the EU. IASs and IFRSs valid on 31 December 2013 have been followed, as well as SIC and IFRIC interpretations. Th e IFRS refer to standards and interpretations thereof approved for application in the EU in compliance with the proceedings stipulated in Regulation (EC) 1606/2002, as referred to in the Finnish Accounting Act and subsequent regulations. Th e notes to the consolidated fi nancial statements also comply with Finnish accounting and corporate legislation.
Th e consolidated fi nancial statements have been prepared on acquisition cost basis with the exception of biological assets, available-for-sale fi nancial assets, fi nancial assets and liabilities measured at fair value through profi t or loss and derivative fi nancial instruments. From the moment of classifi cation, the assets held for sale are measured at the lower of their book value and fair value less cost to sell.
Th e fi nancial statement data is presented in units of 1,000 euros, with sums rounded off to the nearest thousand.
a) New and amended standards that have been applied in the fi nancial period beginning on 1 January 2013
Amendment to IFRS 10, 11 and 12 regarding transition guidance (eff ective for annual periods beginning on or after 1 January 2014). Th e amendment provides transition relief in IFRS 10, 11 and 12, limiting the requirement for adjusted comparative information to one fi nancial period. Comparative information on unconsolidated structured entities does not need to be presented for periods before IFRS 12 is fi rst applied.
IAS 27 (revised in 2011) Separate Financial Statements (eff ective for annual periods beginning on or after 1 January 2014). Th e revised standard contains the requirements for separate fi nancial statements. Th e standard will have no material impact on Atria's consolidated fi nancial statements.
When preparing the fi nancial statements, discretion must be used in applying the accounting policies. In addition, the management must make assessments and assumptions concerning the future and aff ecting assets and debts in relation to responsibilities, profi ts and costs. Th e realised values may deviate from the original assessments and assumptions.
Th e Group management must make discretionary decisions regarding the choice and application of accounting policies. Th is, in particular, applies to cases where the IFRS practice in force contains alternative recognition, measurement or presentation procedures. Th e management has exercised judgment in the classifi cation of assets and fi nancial items and in the recognition of deferred tax assets and reserves.
Th e assessments are based on the management's best estimate at the end date of the reporting period. Th ey are aff ected by previous experiences as well as assumptions about the future that are deemed the most likely at the end of the period and are related to the expected developments in the economic environment. Any changes in the assessments and assumptions are recognised in the accounting period in which the assessment or assumption is adjusted and in all subsequent accounting periods.
Th e assets and liabilities acquired in business combinations are valued using the fair value at the time of acquisition. In signifi cant business combinations, the Group has used an external advisor when measuring the fair value of tangible and intangible assets. In the case of tangible assets, comparisons have been made with the market price of corresponding assets, and the assets have been estimated for impairment caused by their age, wear and other similar factors. Th e fair value of intangible assets is determined based on assessments of asset cash fl ows. Th e management believes that the assessments and assumptions are suffi ciently detailed to be used as the basis for fair value measurement.
Th e Group reviews any indication of impairment of tangible and intangible assets at least at the end date of each reporting period.
In October, Atria announced its intention to discontinue its unprofi table primary pork production in Russia. Furthermore, it was decided that the industrial production and logistics unit located in Moscow will be discontinued by the end of 2014. Due to the discontinuation of these business operations, an impairment of EUR 23.0 million was recognised in the subsidiaries' assets. Of the write-downs, EUR 14.3 million was allocated to fi xed assets, EUR 7.6 million to deferred tax assets and EUR 1.1 million to other assets.
Th e Group conducts annual impairment tests on goodwill and intangible assets with indefi nite useful lives. It also assesses any indication of impairment in accordance with the accounting policies. At the end of the accounting period, the value of the intangible assets to be tested annually was EUR 233.9 million. Th e recoverable amounts of cash-generating units are measured on the basis of value-in-use calculations. Th e cash fl ows estimated in these calculations are based on the fi ve-year fi nancial plans approved by the management.
No impairment losses were booked based on impairment testing in the period under review. Additional information on the recoverable amount susceptibility to changes in the assumptions used can be found in Note 14.
Th e consolidated fi nancial statements include the parent company Atria Plc and all of its subsidiaries. Subsidiaries are companies over which the Group has control. Th e Group is in control when it owns over half of the voting rights or otherwise has control over the company. Control refers to the right to decide on the company's fi nancial and operating principles in order to reap benefi t from its operations. Acquired subsidiaries are consolidated from the moment the Group gains control in them until said control ends.
Business combinations are accounted for using the acquisition method. Th e consideration paid for the acquisition of a subsidiary includes the assets transferred and the liabilities assumed, measured at fair value at the time of the acquisition. Th e consideration also includes the fair value of an asset or liability arising from a contingent consideration arrangement. Acquisition costs are entered as expenses as they arise. Th e net assets and accepted and contingent liabilities acquired in business combinations are valued at fair value at the time of the acquisition. Th e interest of non-controlling owners in the acquisition target is recognised on acquisition basis either at fair value or based on their relative share of the amounts of identifi able net assets of the acquisition target.
Th e amount by which the sum total of paid consideration, the fair value of non-controlling owners' share in the acquisition target and the fair value of the previously held interest exceeds the fair value of the acquired net assets is recognised as goodwill in the balance sheet. If the sum total of the consideration, the fair value of non-controlling owners' share and the fair value of previously held interest is less than the fair value of the acquired net assets of the subsidiary, the diff erence is recognised through profi t or loss.
All intra-Group transactions, receivables and liabilities and income and expenses are eliminated. Profi ts and losses due to intra-Group transactions leading to the recognition of an asset are also eliminated. Th e accounting policies applied by subsidiaries have been, where necessary, revised to match the Group policies.
Th e transactions conducted with non-controlling shareholders which do not lead to a loss of control are treated as equity transactions. When shares are purchased from non-controlling shareholders, the diff erence between the consideration paid and the book value of the share acquired of the net assets of the subsidiary is recognised in equity. Profi t or loss from the sale of shares to non-controlling shareholders is also recognised in equity.
When the control or large infl uence by the Group ceases to exist, any remaining interest is measured at fair value on the date of the loss of control and the change in book value is recognised through profi t or loss. Th is fair value serves as the original book value when the remaining interest is later recognised as an associate, joint venture or fi nancial assets. In addition, the amounts of the said entity previously recognised in other comprehensive income are treated as if the Group had directly assigned the associated assets and liabilities. Th is may mean that amounts previously entered as other comprehensive income become accounted for through profi t or loss.
Associates are companies in which the Group has considerable infl uence but no control. Th is is usually the case when the Group holds shares which entitle it to 20–50% of the voting rights. Th e investments in associates are accounted for using the equity method. When using the equity method, the investment is originally entered at acquisition cost and this amount is augmented or reduced by entering the investing company's share of the subsequent profi ts or losses of the investment object after the time of acquisition.
If the interest in an associate diminishes but a large infl uence remains, only a relative share of the amounts previously recognised in other comprehensive income is accounted for through profi t or loss.
Th e Group share of associates' post-acquisition profi ts or losses is recognised in the income statement under operating profi t. Th e book value of the investment is adjusted accordingly. If the Group's share of the loss of an associate is as great as or greater than its interest in the associate, any other unsecured receivables included, the Group will not adjust the loss up if it does not have a legal or factual obligation to do so and it has not made payments on behalf of the associate.
Joint ventures are companies in which the Group and other parties exercise joint control based on an agreement. Within the Group, joint ventures are consolidated using the equity method.
Th e functional and presentation currency of the parent company is the euro. Th e consolidated fi nancial statements are presented in thousands of euros.
Foreign currency business transactions have been translated into euros at the exchange rate on the date of transaction. Foreign currency receivables and liabilities have been translated into euros at the exchange rate on the closing date. Exchange gains and losses arising from foreign currency transactions as well as receivables and liabilities have been recognised in the income statement, excluding those exchange rate changes of derivative fi nancial instruments that are qualifying cash fl ow hedges or are used to eff ectively protect foreign net investments and loans that are part of a net investment in a foreign operation. Th ese translation diff erences have been recognised in other comprehensive income. Exchange gains and losses from operations are included in the appropriate item before operating profi t. Exchange gains and losses from forward exchange agreements protecting fi nancial transactions and foreign currency-denominated loans are included in fi nancial income and expenses.
Th e profi t and fi nancial position of Group companies outside the euro zone are accounted for in the currency that is the currency of the operating region of the company in question. Th e income statements of Group companies outside the euro zone are translated into euros at the average exchange rate in the reporting period, and the balance sheets at the rate on the closing date. Th e exchange diff erence arising from the use of diff erent translation rates is recognised in other comprehensive income. Th e translation diff erences arising from the elimination of the acquisition costs of subsidiaries outside the euro zone and the hedge profi t deriving from the corresponding net investments are recognised in other comprehensive income. When a foreign operation is partially disposed of or sold, exchange rate diff erences recognised in equity are recognised through profi t or loss as a sales gain or loss.
Property, plant and equipment are recognised at original acquisition cost, less accumulated depreciation and any impairment.
If the property, plant or equipment consists of several parts with diff erent useful lives, each part is treated as a separate asset. In this case, the costs arising from replacing the part are activated. Otherwise, later costs are included in the book value of the property, plant and equipment only if it is probable that the future benefi t connected to the asset will benefi t the Group, and the acquisition cost of the asset can be reliably determined. Other repair and maintenance costs are recognised through profi t or loss after they have materialised.
Depreciation is calculated as straight-line depreciation according to the estimated useful life as follows:
No depreciation is made on land and water. Assets which are not suited for recognition in other property, plant or equipment accounts due to their nature or depreciation periods are recognised as other tangible assets under Land and water, Buildings and structures, and Machinery and equipment.
Th e residual value and useful life of assets are reviewed annually at the closing of the accounts and, if necessary, adjusted so that the book value is equal to or less than the recoverable amount.
Th e depreciation of property, plant and equipment stops when the property, plant or equipment is classifi ed as available for sale in accordance with IFRS 5, Non-current Assets Held for Sale and Discontinued Operations.
Gains and losses accumulated from the disposal or transfer of property, plant or equipment are included in other operating income or expenses.
Leases concerning tangible assets where the Group has a considerable share of the risks and rewards related to ownership are classifi ed as fi nance leases. Finance leases are entered in the balance sheet at the fair value of the leased asset on the day the lease period begins, or at a lower value that corresponds to the current value of the minimum lease payments. Th e depreciation of assets acquired with fi nance leases is made for the period of their useful life or a shorter leasing period. Lease payments are apportioned between a fi nance charge and debt amortisation over the lease period, so that the interest rate for the outstanding liability in each fi nancial year remains constant. Lease obligations are included in interest-bearing debts.
Leases where the risks and rewards related to ownership remain with the lessor are handled as other leases. Rental payments due to other leases are recognised as expenses in the income statement, based on the straight-line method during the lease period.
Goodwill is the amount by which the acquisition cost exceeds the Group's share of the fair value of the acquired subsidiary's identifi able net assets at the time of acquisition. Goodwill arising from the acquisition of subsidiaries is recognised in intangible assets. Goodwill is tested annually for impairment and entered in the balance sheet at acquisition cost less accrued impairment losses. An impairment loss recognised for goodwill is not reversed.
Goodwill is tested annually for impairment. For this purpose, goodwill is allocated to cash-generating units. Th e Group's cash-generating units are classifi ed by business segment based on the operations and location of subsidiaries. Th ey are Atria Finland, Atria Scandinavia, Atria Russia and Atria Estonia. Goodwill is measured at original acquisition cost less impairment.
Intangible assets are entered in the balance sheet at original acquisition cost if the acquisition cost of the asset can be reliably determined and if it is probable that the expected fi nancial benefi t from the asset will benefi t the company.
Intangible assets with a limited useful life are recognised as expenses based on straight-line depreciation in the income statement during their known or estimated useful life. No depreciation is booked for intangible assets with indefi nite useful lives, but they are instead tested annually for impairment.
| Depreciation periods: | |
|---|---|
| • Customer relationships | 3–8 years |
| • Trademarks | 5–10 years |
| • Other intangible assets *) | 5–10 years |
*) Includes computer software, subscription fees etc.
On each closing date, the Group reviews intangible and tangible assets to see whether they show indications of impairment. If there are such indications, the recoverable amount from the said asset is estimated. Th e recoverable amount of cash from goodwill and intangible assets with indefi nite useful lives is assessed annually and whenever indications of impairment are detected. Th e recoverable amount is the fair value of the asset less costs to sell or, if higher, the asset's value in use. If the recoverable amount cannot be assessed per item, the impairment need is observed on the level of cash-fl ow generating units, i.e. at the lowest unit level which is mainly independent of other units and at which cash fl ows can be distinguished from other cash fl ows.
Impairment loss is recognised if the book value of the asset is higher than the recoverable amount. Impairment loss is recognised immediately in the income statement. If the impairment loss arises with regard to a cash-generating unit, it is fi rst allocated to reduce the goodwill and then to reduce the other assets of the unit pro rata. Th e useful life of the depreciated asset is re-evaluated in conjunction with the recognition of an impairment loss. An impairment loss recognised for an asset other than goodwill is reversed if there has been a change in the estimates used to determine the amount recoverable from the said asset. However, the impairment loss may not be reversed in excess of what the asset's book value would be without the recognition of the impairment loss. An impairment loss recognised for goodwill is never reversed.
Inventories are measured at the lower of original cost or probable net realisable value. Th e acquisition cost is determined using the FIFO method. Th e acquisition cost for fi nished and unfi nished products consists of raw materials, direct labour costs, other direct costs, and the appropriate share of manufacturing-related variable overheads and fi xed overheads at a normal level of operations. Th e net realisable value is the estimated selling price in the ordinary course of business, less the estimated selling expenses.
Th e Group's biological assets consist of live animals and growing crops. Biological assets are valued at fair value, less estimated sales-related expenses. Productive animals are included in tangible assets, and other biological assets (slaughter animals and growing crops) are included in inventories.
Agricultural products harvested of the biological assets at harvest time are valued at fair value, less estimated sales-related expenses. Valuation after harvest is conducted in accordance with inventory valuation principles.
Th e fair value of productive biological assets is based on the original acquisition price less a cost corresponding to the reduction of value in use due to the aging of the animals. Th ere is no available market price for productive animals. Th e fair value of slaughter animals equals their market price, which is based on the company's slaughter animal procurement/ sales in the local market. Th e fair value of growing crops is based on production costs.
Classifi cation
Th e Group's fi nancial assets are divided into the following groups:
Th e classifi cation is made on the basis of the purpose of the acquisition, and the assets are classifi ed in connection with the original acquisition.
A fi nancial asset belongs to this category if it has been acquired for trading purposes. Financial assets held for trading are acquired mainly to generate profi t from changes in short-term market prices. Th e derivatives used by the Group that do not fulfi l the hedge accounting conditions in IAS 39 have been classifi ed as held for trading. Th e assets belonging to this category have been classifi ed as current assets.
Loans and other receivables are non-derivative fi nancial assets which involve payments that are fi xed or determinable and which are not listed on active markets. Th ey are included in current assets, except when they fall due within more than 12 months from the end date of the reporting period, in which case they are classifi ed as non-current assets. Trade and loan receivables as well as other receivables and cash and cash equivalents in fi nancial assets are also included in the Group's loans and other receivables.
Financial assets available for sale are non-derivative assets that have been prescribed to this group or that have not been prescribed to any other group. Th ey are included in non-current assets unless they fall due or are intended to be kept for less than 12 months from the closing date, in which case they are included in current assets.
Regular purchases and sales of fi nancial assets are recognised on the basis of the trading date, i.e., the date on which the Group commits to purchase or sell the asset. Financial assets are derecognised when the rights to receive cash fl ows from investments have expired or have been transferred to another party and the Group has substantially transferred all risks and rewards of ownership.
Investments in fi nancial assets not recognised at fair value through profi t or loss are initially recognised at fair value plus all transaction costs that are directly attributable to the acquisition or issue. Financial assets recognised at fair value through profi t or loss are initially recognised at fair value, and all transaction costs are expensed in the income statement. Financial assets recognised at fair value through profi t or loss and available-for-sale fi nancial assets are subsequently measured at fair value. Loans and other receivables are measured at amortised cost using the eff ective interest method.
Unrealised and realised profi ts and losses due to changes in the fair value of fi nancial assets recognised at fair value through profi t or loss are entered in the income statement in the accounting period in which they occur. Exchange diff erences and changes in the fair value of assets classifi ed as available for sale are recognised in other comprehensive income and are presented in the fair value fund, taking into consideration the tax eff ect.
When securities classifi ed as available for sale are sold or impaired, the accumulated fair value adjustments recognised in equity are transferred to the income statement as fi nancial income or expenses. Dividends on available-for-sale equity instruments are recognised in the income statement when the Group's right to receive payments is established. Th e fair values of quoted investments are based on current bid prices. If the market for a fi nancial asset is not active (and for unlisted securities), fair value is established through various valuation techniques or, when the fair value cannot be reliably determined, measured at acquisition cost. Valuation techniques involve the use of recent arm's-length transactions between independent parties, fair values of other instruments that are substantially similar and discounted cash fl ow analysis. Calculations make maximum use of market inputs and they rely as little as possible on entity-specifi c inputs.
Whether there is objective proof of impairment of a fi nancial asset or fi nancial asset category is estimated on each closing date. In the case of equity securities classifi ed as available for sale, a signifi cant or prolonged decline in the fair value of the security below its acquisition cost is considered as an indicator that the securities are impaired. If any such evidence exists, the cumulative loss – measured as the diff erence between the acquisition cost and the current fair value, less any impairment loss on that fi nancial asset previously recognised through profi t or loss – is removed from equity and recognised in the income statement. Impairment losses recognised in the income statement on equity instruments will not be reversed through the income statement.
Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently measured at fair value. Th e method of recognising the resulting gain or loss depends on whether the derivative is designated as a hedging instrument, and if so, the nature of the item being hedged. Th e derivatives hedge accounting is applied to are defi ned as either:
Th e relationship between hedging instruments and hedged items is documented at the inception of the hedging transaction. Risk management objectives and strategies for undertaking various hedge transactions are documented as well. Th e Group documents its assessment, both at hedge inception and on an ongoing basis, of whether the derivatives that are used in hedge transactions are highly eff ective in off setting changes in fair values or cash fl ows of hedged items.
Th e full fair value of a hedging derivative is classifi ed as a non-current asset or liability when the maturity of the hedged item is more than 12 months and as a current asset or liability when the remaining maturity of the hedged item is less than 12 months. Trading derivatives are classifi ed as current assets or liabilities.
Th e fair value of forward exchange agreements is calculated by applying the forward rate at the balance sheet date. Th e fair value of interest rate swaps is calculated by discounting the future cash fl ows using interest rate curves for the currencies in question. Electricity derivatives are measured at fair value using the market prices at the balance sheet date.
Th e eff ective portion of changes in the fair value of derivatives that are designated and qualify as cash fl ow hedges are recognised in other comprehensive income. Th e gain or loss relating to the ineff ective portion is recognised immediately in the income statement under the appropriate item. Gains and losses accumulated in equity are recycled in the income statement in the periods when the hedged item aff ects profi t or loss (for example, when the anticipated purchase that is hedged takes place). However, when the anticipated transaction that is hedged results in the recognition of a nonfi nancial asset (for example, inventories or fi xed assets), the gains and losses previously deferred in equity are transferred from equity and included in the initial acquisition cost of the asset. Th e deferred amounts are ultimately recognised in costs of goods sold in case of inventories, or in depreciations in case of fi xed assets. When a hedging instrument expires or is sold, or when a hedge no longer meets the criteria for hedge accounting, any cumulative gain or loss existing in equity at the time remains in equity and is recognised in the income statement only when the anticipated transaction occurs. When a anticipated transaction is no longer expected to occur, the cumulative gain or loss that was reported in equity is immediately transferred to the income statement under the appropriate item.
Hedges of net investments in foreign operations are accounted for in the same way as cash fl ow hedges. Any gain or loss on the hedging instrument relating to the eff ective portion of the hedge is recognised in other comprehensive income. Th e gain or loss relating to the ineff ective portion is recognised immediately in the income statement. Gains and losses accumulated in equity are included in the income statement when the foreign operation is partially disposed of or sold.
Derivatives that do not meet the criteria for hedge accounting:
Certain derivative fi nancial instruments do not meet the criteria for hedge accounting. All changes in the fair value of these derivatives are immediately recognised in the appropriate item of the income statement.
Trade receivables are initially recognised at fair value and are subsequently measured at amortised cost using the eff ective interest rate method and taking impairment into account. Provisions for impairment for trade receivables are recognised when there is objective evidence that the Group will not be able to collect all amounts due according to the original terms of receivables. Signifi cant fi nancial diffi culties of the debtor, probability that the debtor will enter bankruptcy or fi nancial reorganisation, and default or delinquency in payments are considered indicators that the trade receivable is impaired.
If the impairment loss decreases in a later accounting period, and the reduction can be objectively linked to a transaction that has taken place after the recognition of the impairment loss, the recognised loss is reversed through profi t or loss.
Cash and cash equivalents comprise cash and bank deposits available on demand. Items classifi ed as cash and cash equivalents have a maximum maturity of three months from acquisition. Available credit limits are included in current interest-bearing liabilities.
Non-current assets are classifi ed as held for sale if their book value is to be recovered through a sale rather than through continuing use. Th is condition is regarded as met only when the sale is highly probable and the asset is available for immediate sale in its present condition subject only to terms that are usual and customary. Furthermore, management must be committed to the sale, which should be expected to occur within one year of the date of classifi cation.
Immediately before being classifi ed as held for sale, these assets are measured in accordance with the applicable IFRS standards. Th ereafter, the assets are measured at the lower of their book value and fair value less cost to sell. Th ese assets are no longer depreciated after the classifi cation.
Ordinary shares are presented as share capital. Expenses related to the issue or acquisition of equity instruments are presented as a deductible item under equity.
If a Group company acquires shares in the company, the consideration paid for them and the expenses arising directly from the acquisition, taking the tax eff ect into consideration, are deducted from the shareholders' equity until the shares are either cancelled or reissued. If the shares are reissued, the consideration received for them less transaction costs directly attributable to the shares is included in the shareholders' equity, taking the tax eff ect into consideration.
Financial liabilities are initially recognised at fair value. Th ey are later measured at amortised cost using the eff ective interest rate method. Financial liabilities are included in current and non-current liabilities.
A one-off credit fee related to committed credit facilities is spread over the duration of the agreement. Th e credit limit fees related to such facilities are recognised as a cost based on the passing of time.
A provision is entered when the Group has, due to a past event, a judicial or factual obligation, and the obligation is likely to materialise and the sum of the obligation can be reliably estimated. Provisions are valued at the current value of the expenses required to cover the obligation. Th e amounts of provisions are reviewed on each closing date and adjusted to correspond to the best estimate at that time. Changes in provisions are recognised in the income statement in the same item where the original provision was entered.
Net sales are determined on the basis of the fair value of considerations received or to be received for the sale of products and services, raw materials and equipment, adjusted by indirect taxes and discounts based on normal contractual principles applied in the sector. Revenue from the sale of articles is recognised when the risks and rewards of owning the article have been transferred to the buyer and revenue from services when the service has been completed. Rental income is recognised on a straight-line basis over the lease period.
Interest rates are recognised based on the passing of time, taking into account the eff ective income from the asset. Dividend income is recognised when the shareholders' right to payment is established.
Pension arrangements are classifi ed as either defi ned benefi t or defi ned contribution plans. In defi ned contribution plans, the Group makes fi xed payments into a separate unit. Th e Group has no legal or constructive obligation to make additional payments, if the recipient of the payments cannot pay the pension benefi ts in question. All plans that do not fulfi l these conditions are defi ned benefi t pension plans. Payments made into defi ned contribution plans are recognised in the income statement in the reporting period to which they apply. Th e Group's pension plans are mainly defi ned contribution plans.
In defi ned benefi t plans the company still has an ongoing obligation for the plan even after the payment for the period has been made. For arrangements classifi ed as defi ned benefi t plans, actuarial estimates acquired on a yearly basis serve as the grounds for recognising an expense and liability or asset in the fi nancial statements. Actuarial gains or losses are recognised as equity refund or charge through other comprehensive income in the fi nancial period in which they occur.
Th e Group has in place a long-term reward programme for key personnel. Any profi t from the plan is based on the Group's earnings per share (EPS). Th e programme has three 12-month periods (2012, 2013 and 2014), and the full earning period will end on 31 December 2014. Th e reward earned is determined after the period has expired based on how well the targets have been achieved. Th e benefi ts paid under the programme are measured annually and recognised as expenses and liabilities arising from employee benefi ts spread over the earnings period.
Research expenditure is recognised as an expense in the balance sheet. Development expenditure related to individual projects is activated in the balance sheet when there is enough certainty that the asset in question can be technically implemented and will probably generate a future fi nancial benefi t. Activated development expenditure is recognised as project-specifi c expenses over the useful life of the asset. Th e asset is amortised from the time it is ready for use. Th e Group has no activated development expenses.
Grants received as compensation for expenses are recognised in the income statement, while expenses connected with the grant are entered as costs. Such grants are entered under other operating income. Th e nature of the grants varies from one country to the next and the grants are only recognised after all the terms and conditions of the grant have been met, so the company does not have a repayment obligation regarding grants received. In the period under review, production subsidies for agricultural operations in Russia have been recognised as government grants. Such grants will not be received in the future, since Atria discontinued its primary production operations in Russia in late 2013.
Government grants, such as grants received for the acquisition of property, plant and equipment, are recognised as a deduction in the book value of property, plant and equipment when it is reasonably certain that the grant will be received and that the Group company fulfi ls the prerequisites for receiving the grant. Grants are recognised as income in the form of lower depreciation during the useful life of the asset.
Th e tax expense in the income statement consists of current tax, tax adjustments from previous fi nancial years, and deferred taxes. Taxes are entered in the income statement except if they are connected to other comprehensive income or to items recognised directly in equity. In this case the tax is also entered in other comprehensive income or directly in equity. Current tax is calculated from taxable profi t based on the valid tax rate of each country. Th e tax is adjusted by possible taxes related to previous periods.
Deferred taxes are calculated from all temporary diff erences between the book value and tax base. Th e biggest temporary diff erences arise from the depreciation of property, plant and equipment and fair value measurement in connection with acquisitions. No deferred tax is booked for non-deductible goodwill impairment and no deferred tax is booked for the subsidiaries' undistributed profi ts if the diff erence is not likely to dissolve in the foreseeable future.
Deferred tax is calculated using the tax rates provided by the balance sheet date. Deferred tax assets are recognised to the amount for which it is likely that taxable profi t will be generated in the future against which the temporary diff erence can be utilised.
Exceptional non-core events, such as capital gains and losses from the sale of operations, impairment, the costs of discontinuing signifi cant operations and costs arising from the reorganisation of operations are treated as non-recurring items.
The Group's operating segments are based on the Group's internal organisational structure and internal fi nancial reporting, which the Atria's Board of Directors uses in strategic and operative decision-making. The Atria's Board of Directors assesses the performance of the operating segments based on net sales, EBIT and return on capital employed. The Group has four recognisable geographical segments that differ essentially from one another in terms of the functioning of the markets. They are Atria Finland, Atria Scandinavia, Atria Russia and Atria Baltic. In addition, Group costs are now reported separately in unallocated items. Group costs mainly consist of personnel and administrative costs. A segment's assets and liabilities are items that can be directly attributed or reasonably allocated to the segment. The transactions between the segments take place at market price.
The Group has two customers, and the value of the trade with each of them forms between 10 and 15 per cent of the Group's net sales. The net sales in question are reported in the operating segments Finland, Russia and Baltic.
| Operating segments | Finland | Scandinavia | Russia | Baltic | Unallocated | Eliminations | Group |
|---|---|---|---|---|---|---|---|
| Net sales | |||||||
| External | 872,913 | 383,989 | 121,450 | 32,663 | 1,411,015 | ||
| Internal | 13,857 | 10,973 | 248 | -25,078 | 0 | ||
| Total net sales | 886,770 | 394,962 | 121,450 | 32,911 | -25,078 | 1,411,015 | |
| EBIT | 32,937 | 12,202 | -20,971 | 70 | -4,508 | 19,730 | |
| Financial income and expenses | -15,203 | ||||||
| Income from joint ventures and associates | 2,335 | ||||||
| Income taxes | -11,152 | ||||||
| Profi t for the period | -4,290 | ||||||
| Assets | 460,413 | 386,083 | 130,266 | 41,813 | -40,520 | 978,055 | |
| Liabilities | 202,552 | 265,854 | 127,918 | 10,533 | -40,520 | 566,337 | |
| Investments | 26,721 | 10,554 | 3,592 | 249 | 41,116 | ||
| Depreciation | 25,850 | 11,915 | 9,056 | 2,470 | 49,291 | ||
| Impairment | 994 | 14,104 | 15,098 |
| Operating segments | Finland | Scandinavia | Russia | Baltic | Unallocated | Eliminations | Group |
|---|---|---|---|---|---|---|---|
| Net sales | |||||||
| External | 804,523 | 378,768 | 126,256 | 34,033 | 1,343,580 | ||
| Internal | 14,981 | 9,026 | 144 | -24,151 | 0 | ||
| Total net sales | 819,504 | 387,794 | 126,256 | 34,177 | -24,151 | 1,343,580 | |
| EBIT | 36,511 | 8,187 | -8,586 | -1,489 | -4,413 | 30,210 | |
| Financial income and expenses | -14,698 | ||||||
| Income from joint ventures and associates | 3,395 | ||||||
| Income taxes | -8,842 | ||||||
| Profi t for the period | 10,065 | ||||||
| Assets | 447,106 | 399,087 | 172,735 | 43,879 | -21,179 | 1,041,628 | |
| Liabilities | 177,095 | 282,524 | 159,254 | 12,487 | -21,179 | 610,181 | |
| Investments | 38,633 | 11,989 | 5,091 | 521 | 56,234 | ||
| Depreciation | 24,756 | 11,916 | 10,328 | 2,628 | 49,628 | ||
| Impairment | 31 | 116 | 147 |
| 2. Net sales, EUR 1,000 | 2013 | 2012 |
|---|---|---|
| Sale of goods | 1,402,247 | 1,333,396 |
| Other sales | 8,768 | 10,184 |
| Total | 1,411,015 | 1,343,580 |
| 3. Research and development costs, EUR 1,000 | ||
| Research and development costs recognised as expenditure | 11,821 | 12,021 |
| 4. Fees paid to auditors, EUR 1,000 | ||
| Auditing fees | 473 | 486 |
| Reports and statements | 39 | 51 |
| Tax consulting | 10 | 6 |
| Other remunerations | 5 | 14 |
| Total | 527 | 557 |
| 5. Other operating income, EUR 1,000 | ||
| Sales income from fi xed assets *) | 1,654 | 1,733 |
| Contributions received | 435 | 82 |
| Other | 4,055 | 1,996 |
*) During the fi nancial period, the logistics centre located in Forssa was transferred from assets available for sale back to tangible assets. As a result of the reclassifi cation, write-downs in the amount of EUR 1.1 million recognised during earlier fi nancial periods were reversed.
Total 6,144 3,811
| Sales loss from fi xed assets | 496 | 0 |
|---|---|---|
| Impairment of fi xed assets *) | 15,098 | 147 |
| Depreciation on intangible assets | 653 | 941 |
| Other | 2,337 | 3,536 |
| Total | 18,584 | 4,624 |
*) Atria Russia discontinued its unprofi table primary pork production in Russia. Furthermore, it was decided that the industrial production and logistics unit located in Moscow will be discontinued by the end of 2014. As a result, non-recurring impairments amounting to EUR 14.3 million were recognised in fi xed assets.
| Expenses from employee benefi ts: | ||
|---|---|---|
| Wages and salaries | 182,141 | 182,749 |
| Pension costs - defi ned contribution plans | 26,720 | 27,404 |
| Pension costs - defi ned benefi t plans | 157 | 187 |
| Other staff-related expenses | 22,266 | 23,339 |
| Total | 231,284 | 233,679 |
| Information on management's employee benefi ts is presented in Note 31. | ||
| Expenses from employee benefi ts by function: | ||
| Costs of goods sold | 175,156 | 177,632 |
| Sales and marketing expenses | 34,296 | 33,554 |
| Administrative expenses | 21,832 | 22,493 |
| Total | 231,284 | 233,679 |
| 2013 | 2012 | |
|---|---|---|
| Group personnel on average by business area (FTE): | ||
| Finland | 2,146 | 2,048 |
| Scandinavia | 1,050 | 1,119 |
| Russia | 1,151 | 1,384 |
| Baltic | 322 | 347 |
| Total | 4,669 | 4,898 |
| Depreciation and impairment by function | ||
|---|---|---|
| Costs of goods sold | 45,092 | 44,334 |
| Sales and marketing expenses | 1,769 | 1,813 |
| Administrative expenses | 2,532 | 2,508 |
| Other operating expenses | 14,996 | 1,120 |
| Total | 64,389 | 49,775 |
| Financial income: | ||
|---|---|---|
| Interest income from loan assets | 2,265 | 3,604 |
| Exchange rate gains from fi nancial liabilities and loan receivables measured at amortised cost | 588 | 6,414 |
| Dividends received from fi nancial assets for sale | 83 | 83 |
| Other fi nancial income | 2 | 83 |
| Changes in the value of fi nancial assets recognised at fair value through profi t or loss | ||
| - derivative fi nancial instruments - not in hedge accounting | 11,800 | 4,447 |
| Total | 14,738 | 14,631 |
| Financial expenses: | ||
| Interest expenses from fi nancial liabilities measured at amortised cost | -15,368 | -16,683 |
| Exchange rate losses from fi nancial liabilities and loan receivables measured at amortised cost | -8,574 | -1,008 |
| Other fi nancial expenses | -1,989 | -1,896 |
| Changes in the value of fi nancial assets recognised at fair value through profi t or loss | ||
| - derivative fi nancial instruments - not in hedge accounting | -4,010 | -9,742 |
| Total | -29,941 | -29,329 |
| Total fi nancial income and expenses | -15,203 | -14,698 |
| Items related to fi nancial instruments and recognised in other items of | ||
| total comprehensive income before taxes: | ||
| Cash fl ow hedge | 2,260 | -1,624 |
| Financial assets available for sale | 38 | 8 |
| Translation differences | -11,609 | 6,937 |
| Total | -9,311 | 5,321 |
| 10. Income taxes, EUR 1,000 | 2013 | 2012 | |
|---|---|---|---|
| Taxes in the income statement: | |||
| Tax based on the taxable profi t for the period | 4,055 | 9,118 | |
| Retained taxes | -23 | 391 | |
| Deferred tax | 7,120 | -667 | |
| Total | 11,152 | 8,842 | |
| Balancing of income statement taxes to profi t before taxes: | |||
| Profi t before taxes | 6,862 | 18,907 | |
| Taxes calculated with parent company's 24,5% tax rate | 1,681 | 4,632 | |
| Effect of foreign subsidiaries' deviating tax rates | 1,818 | 2,031 | |
| Retained taxes and reassessment of deferred taxes | 7,215 | 443 | |
| Effect of income from joint ventures/associates | -572 | -832 | |
| Effect of tax-free income | -540 | -106 | |
| Effect of costs that are undeductible in taxation | 4,658 | 1,977 | |
| Unrecognised deferred tax assets | 646 | 2,120 | |
| Changes in tax rate | -4,289 | -1,621 | |
| Other changes | 535 | 198 | |
| Total | 11,152 | 8,842 | |
| Taxes recognised in other items of total comprehensive income | Before tax | Tax effects | After tax |
| 2013: | |||
| Cash fl ow hedge | 2,260 | -793 | 1,467 |
| Financial assets available for sale | 38 | -1 | 37 |
| Actuarial gains from pension liabilities | 1,104 | -243 | 861 |
| Translation differences | -11,609 | -11,609 | |
| Total | -8,207 | -1,037 | -9,244 |
| 2012: | |||
| Cash fl ow hedge | -1,619 | 397 | -1,222 |
| Financial assets available for sale | 8 | -2 | 6 |
| liabilities | -415 | 7 | -408 |
| Translation differences | 6,937 | 6,937 | |
| Total | 4,911 | 402 | 5,313 |
| 11. Earnings per share, EUR 1,000 | 2013 | 2012 |
|---|---|---|
Basic earnings per share are calculated by dividing the parent company's shareholder's profi t for the period by the weighted average number of outstanding shares.
| Profi t/loss for the period attributable to the owners of the parent company | -4,338 | 9,823 |
|---|---|---|
| Weighted average of shares for the period (1,000) | 28,156 | 28,156 |
| Basic earnings per share | -0.15 | 0.35 |
When calculating the earnings per share adjusted by the dilution effect, the dilution effect from all potential dilutive conversions of ordinary shares is taken into account in the weighted average number of shares.
| Machinery | ||||||
|---|---|---|---|---|---|---|
| Land and | Buildings and | and | Other tangible | Acquisitions in | ||
| water | structures | equipment | assets | progress | Total | |
| Acquisition cost, 1 Jan 2013 | 12,836 | 493,952 | 575,376 | 5,075 | 23,784 | 1,111,023 |
| Business combinations | 0 | |||||
| Increases | 148 | 22,213 | 24,988 | 2,642 | 28,389 | 78,380 |
| Decreases | -92 | -24,718 | -16,804 | -3 | -39,357 | -80,974 |
| Exchange differences | -763 | -11,833 | -10,264 | -292 | 86 | -23,066 |
| Acquisition cost, 31 Dec 2013 | 12,129 | 479,614 | 573,296 | 7,422 | 12,902 | 1,085,363 |
| Accumulated depreciation and impairment, 1 Jan 2013 |
-204,206 | -428,899 | -1,842 | -11 | -634,958 | |
| Business combinations | 0 | |||||
| Decreases | 17,002 | 17,488 | 3 | 34,493 | ||
| Depreciation | -12,705 | -33,878 | -682 | -47,265 | ||
| Impairment | -11,875 | -3,191 | -2 | -15,068 | ||
| Exchange differences | 3,469 | 7,399 | 93 | 10,961 | ||
| Accumulated depreciation and impairment, 31 Dec 2013 |
-208,315 | -441,081 | -2,430 | -11 | -651,837 | |
| Book value, 1 Jan 2013 | 12,836 | 289,746 | 146,477 | 3,233 | 23,773 | 476,065 |
| Book value, 31 Dec 2013 | 12,129 | 271,299 | 132,215 | 4,992 | 12,891 | 433,526 |
| Machinery | ||||||
|---|---|---|---|---|---|---|
| Land and | Buildings and | and | Other tangible | Acquisitions in | ||
| water | structures | equipment | assets | progress | Total | |
| Acquisition cost, 1 Jan 2012 | 12,499 | 463,964 | 544,151 | 3,075 | 28,284 | 1,051,973 |
| Business combinations | 1,433 | 1,433 | ||||
| Increases | 8 | 27,288 | 28,995 | 2,032 | 28,493 | 86,816 |
| Decreases | -2,205 | -6,180 | -56 | -33,033 | -41,474 | |
| Exchange differences | 329 | 4,905 | 6,977 | 24 | 40 | 12,275 |
| Acquisition cost, 31 Dec 2012 | 12,836 | 493,952 | 575,376 | 5,075 | 23,784 | 1,111,023 |
| Accumulated depreciation and impairment, | ||||||
| 1 Jan 2012 | -192,002 | -394,065 | -1,515 | -11 | -587,593 | |
| Business combinations | -658 | -658 | ||||
| Decreases | 1,840 | 5,047 | 56 | 6,943 | ||
| Depreciation | -12,559 | -34,448 | -374 | -47,381 | ||
| Impairment | -2 | -145 | -147 | |||
| Exchange differences | -1,483 | -4,630 | -9 | -6,122 | ||
| Accumulated depreciation and impairment, | ||||||
| 31 Dec 2012 | -204,206 | -428,899 | -1,842 | -11 | -634,958 | |
| Book value, 1 Jan 2012 | 12,499 | 271,962 | 150,086 | 1,560 | 28,273 | 464,380 |
| Book value, 31 Dec 2012 | 12,836 | 289,746 | 146,477 | 3,233 | 23,773 | 476,065 |
Assets acquired with fi nancial leasing contracts are included in machinery and equipment. The acquisition cost recognised on the basis of the fi nancial leasing contracts was EUR 4.1 million (EUR 5.8 million) and accumulated depreciation was EUR 3.4 million (EUR 4.1 million). The book value of assets was EUR 0.8 million (EUR 1.7 million).
The value of property, plant and equipment includes borrowing costs totalling EUR 0.1 million (EUR 0.3 million).
The tangible assets used as loan collateral amount to EUR 11.2 million (EUR 11.7 million).
| 13. Biological assets, EUR 1,000 | 2013 | 2012 |
|---|---|---|
| Biological assets: | ||
| Productive | 775 | 1,464 |
| Consumable | 3,345 | 5,504 |
| At end of the period | 4,120 | 6,968 |
| Amounts of biological assets at the end of the period: | ||
| Boars, sows, gilts/number | 4,396 | 8,076 |
| Pigs for fattening / number | 29,174 | 55,921 |
| Chicken eggs, chicken chicks / number | 2,515,514 | 2,368,446 |
| Growing crops / hectares | 0 | 1,414 |
| Production of agricultural products during the period: | ||
| Pork/1,000 kg | 10,526 | 7,412 |
| Chicken chicks/1,000 | 25,250 | 22,582 |
| Cereal/1000 kg | 7,966 | 4,845 |
The fair value of productive biological assets is based on the original acquisition price less a cost corresponding to the reduction of value in use due to the aging of the animals. The fair value of slaughter animals equals their market price, which is based on the company's slaughter animal procurement/ sales in the local market.
Agricultural production has been practised in order to control raw material risks in the meat product business. Any increase in the cost of agricultural production has, where possible, been passed on in the production chain to the meat product business and to the meat product sale prices.
| Intangible assets | Goodwill | Trademarks | Customer relationships |
Other intangible assets |
Total |
|---|---|---|---|---|---|
| Acquisition cost, 1 Jan 2013 | 187,274 | 78,559 | 1,079 | 23,159 | 290,071 |
| Business combinations | 0 | ||||
| Increases | 2,900 | 2,900 | |||
| Decreases | -657 | -657 | |||
| Exchange differences | -3,846 | -2,530 | -188 | -6,564 | |
| Acquisition cost, 31 Dec 2013 | 183,428 | 76,029 | 1,079 | 25,214 | 285,750 |
| Accumulated depreciation and impairment, 1 Jan 2013 |
-18,772 | -5,627 | -717 | -18,007 | -43,123 |
| Business combinations | 0 | ||||
| Depreciation on decreases | 443 | 443 | |||
| Depreciation | -462 | -71 | -1,493 | -2,026 | |
| Impairment | -30 | -30 | |||
| Exchange differences | 100 | 458 | 164 | 722 | |
| Accumulated depreciation, 31 Dec 2013 | -18,672 | -5,631 | -788 | -18,923 | -44,014 |
| Book value, 1 Jan 2013 | 168,502 | 72,932 | 362 | 5,152 | 246,948 |
| Book value, 31 Dec 2013 | 164,756 | 70,398 | 291 | 6,291 | 241,736 |
| Intangible assets | Goodwill | Trademarks | Customer relationships |
Other intangible assets |
Total |
|---|---|---|---|---|---|
| Acquisition cost, 1 Jan 2012 | 183,321 | 73,820 | 2,347 | 21,175 | 280,663 |
| Business combinations | 1,080 | 2,500 | 1 | 3,581 | |
| Increases | 1,959 | 1,959 | |||
| Decreases | -1,268 | -92 | -1,360 | ||
| Exchange differences | 2,873 | 2,239 | 116 | 5,228 | |
| Acquisition cost, 31 Dec 2012 | 187,274 | 78,559 | 1,079 | 23,159 | 290,071 |
| Customer | Other intangible | ||||
|---|---|---|---|---|---|
| Intangible assets | Goodwill | Trademarks | relationships | assets | Total |
| Accumulated depreciation and impairment, 1 Jan 2012 |
-20,245 | -4,883 | -1,695 | -16,401 | -43,224 |
| Business combinations | 0 | ||||
| Depreciation on decreases | 1,268 | 40 | 1,308 | ||
| Depreciation | -410 | -290 | -1,547 | -2,247 | |
| Impairment | 0 | ||||
| Exchange differences | 1,473 | -334 | -99 | 1,040 | |
| Accumulated depreciation, 31 Dec 2012 | -18,772 | -5,627 | -717 | -18,007 | -43,123 |
| Book value, 1 Jan 2012 | 163,076 | 68,937 | 652 | 4,774 | 237,439 |
| Book value, 31 Dec 2012 | 168,502 | 72,932 | 362 | 5,152 | 246,948 |
Goodwill and intangible assets with indefi nite useful lives are allocated to the Group's cash-generating units as follows:
| Goodwill | Trademarks | ||||
|---|---|---|---|---|---|
| 2013 2012 |
2013 | 2012 | |||
| Atria Finland | 4,801 | 4,801 | 2,500 | 2,500 | |
| Atria Scandinavia | 150,894 | 154,640 | 59,015 | 60,488 | |
| Atria Russia | 4,726 | 5,311 | |||
| Atria Estonia | 9,061 | 9,061 | 2,857 | 4,148 | |
| Total | 164,756 | 168,502 | 69,098 | 72,447 |
The recoverable amount of a cash-generating unit is defi ned on the basis of value-in-use calculations. These calculations, which use cash fl ow forecasts based on management-approved budgets and strategic targets, are defi ned before taxes and extend over a fi ve-year period. Cash fl ows after the fi veyear forecast period are extrapolated using the growth rates presented below. The growth rate used does not exceed the average long-term growth rate of the industry in which the unit that generates the cash fl ow operates.
| Atria Russia | ||||
|---|---|---|---|---|
| Key assumptions for 2013 | Atria Finland | Atria Scandinavia | brand | Atria Estonia |
| Long-term net sales growth rate | 1,0% | 1,0% | 4,5% | 1,0% |
| Discount rate defi ned before taxes | 5,2% | 5,6% | 11,4% | 5,9% |
| Atria Russia | ||||
| Key assumptions for 2012 | Atria Finland | Atria Scandinavia | brand | Atria Estonia |
| Long-term net sales growth rate | 1,0% | 1,0% | 4,5% | 1,0% |
The most important assumptions used in Atria's impairment testing for cash fl ow forecasts are growth in net sales and long-term EBIT margin. The growth and profi tability assumptions used are based on the profi tability levels and growth rate in net sales that the company will experience in the near future in Finland and Scandinavia. EBIT margins are expected to be close to the Group's targeted level of 5%. The improving long-term profi tability of the Baltic region is based on increased profi tability achieved through effi ciency improvement measures, which is expected to continue. The expansion of the product range, the more profi table use of meat raw material and the improvement of the general market situation will also raise the company's profi tability in the next few years.
Growth percentage assumptions are moderate in all market areas. Russia's higher growth projection is due to its higher infl ation rate, higher market growth expectations and the relatively high growth projection for meat consumption. Due to the relatively stable development of the food industry and moderately optimistic growth forecasts, it is unlikely that the growth rate assumptions will generate impairment losses in the future.
As regards EBIT margins, impairment losses must be recognised if the long-term level in Scandinavia and Estonia remains about 54% and 21% below the assumption, respectively. In Finland, the EBIT percentage should be approximately 69% below the assumption before the need for impairment arises.
Discount rates could produce impairment losses (all cash fl ow forecasts being equal) if they increased by 3.6 percentage points in Scandinavia and 0.7 percentage points in Estonia. In Finland, an increase by over 8,0 percentage points would lead to depreciations. Clearly higher discount rates would mean that the market situation has changed in such a way that the change could affect Atria's cash fl ows as well. Therefore, the above-mentioned increases in discount rates do not directly mean that there would be a need for impairment.
In the fi nancial statements, a separate test was conducted on a trademark with an indefi nite useful life for Atria Russia. The testing did not indicate a need for recognising an impairment loss. On the basis of a sensitivity analysis, an impairment loss is not likely to be recognised for the trademark in the coming years, either.
| Investments in joint ventures | ||||||
|---|---|---|---|---|---|---|
| and associates | 2013 | 2012 | ||||
| In joint ventures: | ||||||
| At the beginning of the period | 7,006 | 5,918 | ||||
| Share of earnings for the period | 2,433 | 3,863 | ||||
| Dividends received | -1,190 | -533 | ||||
| Other changes | 4,000 | -2,242 | ||||
| At the end of the period | 12,249 | 7,006 | ||||
| In associates: | ||||||
| At the beginning of the period | 7,634 | 7,965 | ||||
| Share of earnings for the period | -98 | -468 | ||||
| Dividends received | 0 | -61 | ||||
| Other changes | -4,486 | 198 | ||||
| At the end of the period | 3,050 | 7,634 | ||||
| Total | 15,299 | 14,640 | ||||
| Joint ventures and associates | Domicile | Assets | Liabilities | Net sales | Profi t/loss | Holding (%) |
| 2013: | ||||||
| Joint ventures: | ||||||
| Honkajoki Oy Group | Honkajoki | 30,618 | 14,336 | 30,283 | 4,731 | 50.0 |
| Finnish Meat Research Institute, | ||||||
| LTK Co-operative | Hämeenlinna | 11,138 | 1,843 | 22,433 | 132 | 50.0 |
| Länsi-Kalkkuna Oy | Säkylä | 3,099 | 2,558 | 26,871 | 30 | 50.0 |
| Associates: | ||||||
| Domretor Oy | Kauhava | 2,658 | 312 | 4,774 | 808 | 24.9 |
| Findest Protein Oy *) | Kaustinen | 1,850 | 975 | 3,857 | -8 | 41.7 |
| Finnpig Oy Group | Seinäjoki | 3,477 | 2,133 | 2,960 | 81 | 50.0 |
| Foodwest Oy | Seinäjoki | 1,071 | 258 | 1,938 | -21 | 33.5 |
| Kiinteistö Oy Itikanmäen | ||||||
| Teollisuustalo | Seinäjoki | 3,742 | 37 | 231 | 14 | 13.2 |
| Transbox Oy | Helsinki | 1,700 | 1,315 | 6,558 | 2 | 25.7 |
| Tuoretie Oy | Seinäjoki | 8,295 | 7,344 | 64,773 | 11 | 33.3 |
| 2012: | ||||||
| Joint ventures: | ||||||
| Honkajoki Oy Group | Honkajoki | 23,601 | 10,066 | 28,130 | 4,633 | 50.0 |
| Länsi-Kalkkuna Oy | Säkylä | 3,541 | 2,631 | 27,194 | 21 | 50.0 |
| Associates: | ||||||
| OOO Dan-Invest | Krasnodar, Russia | 44,502 | 38,282 | 676 | -3,001 | 26.0 |
| Findest Protein Oy *) | Kaustinen | 2,076 | 1,193 | 3,672 | -253 | 41.7 |
| Finnpig Oy Group | Seinäjoki | 3,002 | 2,508 | 3,289 | 108 | 50.0 |
| Foodwest Oy | Seinäjoki | 1,140 | 306 | 2,137 | -19 | 33.5 |
| Kiinteistö Oy Itikanmäen | ||||||
| Teollisuustalo | Seinäjoki | 3,716 | 25 | 190 | -7 | 13.2 |
| Finnish Meat Research Institute, LTK Co-operative |
Hämeenlinna | 11,128 | 1,961 | 22,375 | 202 | 40.7 |
| Param Para AB | Stockholm, Sweden | 2,912 | 2,498 | 3,818 | 19 | 24.0 |
| Transbox Oy | Helsinki | 1,811 | 1,428 | 5,642 | 5 | 25.7 |
| Tuoretie Oy | Seinäjoki | 8,052 | 7,103 | 63,246 | 14 | 33.3 |
*) Ownership share: direct 16.6% and indirect 25.1 %
| 2013 | 2012 | |
|---|---|---|
| Other fi nancial assets include fi nancial assets available for sale: | ||
| Financial assets available for sale, 1.1 Jan | 1,748 | 1,638 |
| Increases | 441 | 110 |
| Decreases | ||
| Financial assets available for sale, 31 Dec | 2,189 | 1,748 |
| Financial assets available for sale include the following items: | ||
| Listed securities | 220 | 182 |
| Unlisted securities | 1,969 | 1,566 |
| Total | 2,189 | 1,748 |
| Balance sheet values 2013 |
Balance sheet values 2012 |
|
|---|---|---|
| Trade receivables from producers | 1,444 | 3,364 |
| Loan receivables | 4,884 | 6,852 |
| Other receivables | 1,165 | 1,399 |
| Accrued credits and deferred charges | 1 | 21 |
| Total | 7,494 | 11,636 |
| Fair values do not deviate signifi cantly from balance sheet values. | ||
| Non-current receivables were divided into currencies as follows: | ||
| EUR | 6,470 | 10,478 |
| SEK | 1,011 | 1,128 |
| Other | 13 | 30 |
| Total | 7,494 | 11,636 |
The "trade receivables from producers" account includes feed and animal trading receivables from animal payments that fall due in more than 12 months. The credit risk of these receivables is explained in Note 20.
No impairment has been recognised for loans and other receivables. The maximum credit risk for loans and other receivables is equivalent to their book value.
| 2013 | 2012 | |
|---|---|---|
| Deferred tax assets: | ||
| Tax asset to be realised in more than 12 months | 4,430 | 15,053 |
| Tax asset to be realised within 12 months | 460 | 434 |
| Total | 4,890 | 15,487 |
| Deferred tax liabilities: | ||
| Tax liability to be realised in more than 12 months | 44,687 | 47,352 |
| Tax liability to be realised within 12 months | 10 | 12 |
| Total | 44,697 | 47,364 |
| Deferred tax assets by balance sheet item: | ||
| Intangible and tangible assets | 670 | 1,305 |
| Inventories | 69 | 475 |
| Trade and other receivables | 763 | 834 |
| Interest-bearing and non-interest-bearing liabilities | 1,881 | 3,404 |
| Recognised losses | 1,507 | 9,469 |
| Total | 4,890 | 15,487 |
| Deferred tax liabilities by balance sheet item: | ||
| Intangible and tangible assets | 44,537 | 47,241 |
| Financial assets | 35 | 34 |
| Inventories | 19 | |
| Trade and other receivables | 69 | 77 |
| Interest-bearing and non-interest-bearing liabilities | 37 | 12 |
| Total | 44,697 | 47,364 |
| Change in deferred taxes: | ||
| Recognised in the income statement | -7,120 | 667 |
| Recognised in other items of the total comprehensive income | -849 | 402 |
| Acquisition of a subsidiary | 0 | -637 |
| Exchange differences | 39 | -300 |
| Total | -7,930 | 132 |
Deferred tax assets for unused tax losses are recognised to the amount for which obtaining tax benefi ts on the basis of taxable profi t is likely. Losses for the accounting period, for which deferred tax assets have been left unrecognised, amount to EUR 2.6 million (EUR 15.7 million).
| Deferred tax assets recognised from confi rmed losses age as follows: | |
|---|---|
| 2020 | 835 |
| 2021 | 587 |
| 2023 | 85 |
| Total | 1,507 |
| 2013 | 2012 | |
|---|---|---|
| Materials and supplies | 50,663 | 50,087 |
| Unfi nished products | 15,032 | 15,308 |
| Finished products | 44,965 | 45,247 |
| Other inventories | 3,474 | 3,626 |
| Total | 114,134 | 114,268 |
During the accounting period, EUR 0.8 million (EUR 1.3 million), i.e. the amount used to lower the book value of the inventories to a value comparable with the net realisable value, was recognised as expenses.
| 2013 | 2012 | |
|---|---|---|
| Trade receivables | 76,355 | 88,605 |
| Trade receivables from producers | 17,269 | 25,463 |
| Loan receivables | 2,651 | 2,673 |
| Other receivables | 11,740 | 13,076 |
| Derivative fi nancial instruments - in hedge accounting | 26 | 51 |
| Derivative fi nancial instruments - not in hedge accounting | 447 | 55 |
| Accrued credits and deferred charges | 5,453 | 10,124 |
| Total | 113,941 | 140,047 |
Fair values do not deviate signifi cantly from balance sheet values.
In the Atria Group, credit risk from trade receivables is considered small in proportion to the scope of the operations. The Group's trade receivables are dispersed over several market areas and many customers. Credit loss risk is managed with securities, such as credit insurance and bank guarantees as well as with advance invoicing. Each business area has been assigned a separate credit policy that takes the special features of the market area into account. Credit risk is examined and monitored on a case-by-case basis for major customers and customer groups.
The "trade receivables from producers" account includes feed and animal trading receivables from animal payments. The receivables situation and security values are monitored regularly in accordance with the credit policy.
Material items in accrued credits and deferred charges consist of prepaid expenses of purchase invoices, lease receivables and tax amortisations.
| Breakdown of trade receivables and items booked as credit losses | 2013 | Credit losses | Net 2013 |
|---|---|---|---|
| Not due | 74,390 | 0 | 74,390 |
| Overdue Less than 30 days |
13,077 | 63 | 13,140 |
| 30–60 days | 2,070 | -59 | 2,011 |
| 61–90 days | 924 | -55 | 869 |
| More than 90 days | 3,940 | -726 | 3,214 |
| Total | 94,401 | -777 | 93,624 |
| Breakdown of trade receivables and items booked as credit losses | 2012 | Credit losses | Net 2012 |
| Not due | 95,706 | -104 | 95,602 |
| Overdue Less than 30 days |
14,209 | -25 | 14,184 |
| 30–60 days | 1,605 | -42 | 1,563 |
| 61–90 days | 776 | -54 | 722 |
| More than 90 days | 2,985 | -988 | 1,997 |
| Total | 115,281 | -1,213 | 114,068 |
| Current receivables were divided into currencies as follows: | 2013 | 2012 | |
| EUR | 63,854 | 79,165 | |
| SEK | 21,885 | 27,842 | |
| RUB | 15,857 | 21,109 | |
| DKK | 7,457 | 7,387 | |
| USD | 1,933 | 1,343 | |
| NOK | 906 | 1,073 | |
| Others | 2,049 | 2,128 | |
| Total | 113,941 | 140,047 |
| 2013 | 2012 |
|---|---|
| Cash in hand and at banks 28,844 |
6,556 |
| Finland | Russia | Baltic | Total | |
|---|---|---|---|---|
| 2013: | ||||
| Land and water | 0 | |||
| Buildings and structures | 5,919 | 1,098 | 7,017 | |
| Other tangible assets | 0 | |||
| Total | 0 | 5,919 | 1,098 | 7,017 |
| 2012: | ||||
| Land and water | 146 | 146 | ||
| Buildings and structures | 1,246 | 1,098 | 2,344 | |
| Other tangible assets | 17 | 17 | ||
| Total | 1,409 | 0 | 1,098 | 2,507 |
The "non-current assets available for sale" account includes industrial real estate in Lithuania and a pig farm in Russia. In September, Atria announced its intention to discontinue primary production in Russia. The pig farm buildings left empty in December were transferred to assets available for sale.
During the accounting period, the logistics centre in Forssa was transferred from assets available for sale back to tangible assets. Today, the property is used by the company. As a result of the reclassifi cation, write-downs in the amount of EUR 1.1 million recognised during earlier fi nancial periods were reversed. This non-recurring profi t item has been recognised under "Other operating income".
In Sweden, the Halmstad plant real estate, which had remained empty after production was moved to the Malmö plant, was classifi ed as an asset available for sale in March. The value of the real estate was reduced by a total of EUR 1.0 million, to align it with its fair value. Impairments have been recognised under "Other operating income". The real estate was sold in December.
The company attempts to actively sell the real estate, but sales periods tend to be longer due to the depressed market situation. The company expects the sales to come through after markets have recovered.
Shares are divided into A and KII series, which differ in terms of voting rights. A series shares have one vote per share and KII series shares have ten votes per share. A series shares have preference for a dividend of EUR 0.17, after which KII series shares are paid a dividend of up to EUR 0.17. If there is still more dividend available for distribution, A and KII series shares have the same entitlement to the dividend. All issued shares have been paid in full. The share has no nominal value or a maximum number.
| A series | KII series | Total |
|---|---|---|
| 18,952 | 9,204 | 28,156 |
| 18,952 | 9,204 | 28,156 |
| 18,952 | 9,204 | 28,156 |
The portion of share subscription payments recognised in share premium in compliance with the conditions of plans prior to the new Companies Act (21.7.2006/624) taking effect.
The treasury shares reserve contains the acquisition cost of own shares held by the Group. In 2008 and 2009, the Group's parent company, Atria Plc, acquired 145,102 series A shares on the stock exchange for an acquisition cost of EUR 1.3 million. In 2008, 35,260 of the acquired shares and, in 2010, 3,280 shares were transferred to key persons as a part of the Group's share incentive plan. At the end of the year, the parent company held a total of 111,312 (111,312) treasury shares.
| Other funds | 2013 | 2012 |
|---|---|---|
| Fair value reserve | 141 | 104 |
| Hedging fund | ||
| Effective portion of commodity derivatives | -1,234 | -743 |
| Effective portion of interest rate derivatives | -4,097 | -6,849 |
| Deferred tax | 1,067 | 1,861 |
| Total | -4,264 | -5,731 |
| Total other funds | -4,123 | -5,627 |
The other funds item includes the fair value reserve and hedging fund. Changes in the fair value of available-for-sale fi nancial assets are recognised in the fair value reserve, while the effective portions of changes in the fair value of the derivative fi nancial instruments used for hedging are recognised in the hedging fund. Hedge accounting results for commodity derivatives are transferred from equity to the income statement for adjustment of purchase expenses and, correspondingly, the hedging result for interest rate derivatives is transferred for adjustment of interest expenses.
This reserve contains other equity investments and the share subscription price to the extent that it is not recognised in share capital according to a separate decision, as well as the value of shares earned before 2012 on the basis of the share incentive plan, calculated at the rate of the grant date.
The following are recognised: the translation differences from the translation of the fi nancial statements of foreign subsidiaries, as well as the translation of fair value adjustments of goodwill, assets and liabilities arising in conjunction with the acquisition of the said companies. Profi ts and losses arisen from hedges of net investments in foreign operations are also recognised as translation differences when the hedge accounting criteria are met.
| Parent company's distributable shareholders' equity | 2013 | 2012 |
|---|---|---|
| Invested unrestricted equity fund | 110,228 | 110,228 |
| Retained earnings | 88,802 | 84,034 |
| Treasury shares | -1,277 | -1,277 |
| Profi t for the period | -24,107 | 10,963 |
| Total | 173,643 | 203,946 |
| Dividend per share paid for the period | 2013 | 2012 |
| Dividend/share, EUR | 0,22 | 0,20 |
| Dividend distributed by the parent company | 6,194 | 5,631 |
The Board of Directors proposes to the Annual General Meeting to be held on 6 May 2014 that the company pay EUR 0.22 per share in dividend, totalling EUR 6,194,411.52.
| 2013 Balance sheet values |
2012 Balance sheet values |
|
|---|---|---|
| Non-current | ||
| Bonds | 50,000 | 40,000 |
| Loans from fi nancial institutions | 130,727 | 179,792 |
| Pension fund loans | 33,607 | 41,764 |
| Other liabilities | 1,010 | 2,011 |
| Finance lease obligations | 495 | 770 |
| Total | 215,839 | 264,337 |
| Current | ||
| Bonds | 40,000 | 40,000 |
| Loans from fi nancial institutions | 14,043 | 15,801 |
| Commercial papers | 54,100 | 33,300 |
| Pension fund loans | 8,157 | 8,157 |
| Other liabilities | 2,290 | 7,884 |
| Finance lease obligations | 304 | 1,000 |
| Total | 118,894 | 106,142 |
| Total interest-bearing liabilities | 334,733 | 370,479 |
The fair values of interest-bearing loans do not deviate signifi cantly from balance sheet values.
| With fi xed interest rates | 55,3% | 49,8% |
|---|---|---|
| With variable interest rates | 44,7% | 50,2% |
| Average interest rate | 3,34% | 2,98% |
| Non-current liabilities mature as follows: | |
|---|---|
| 2014 | 91,546 | |
|---|---|---|
| 2015 | 11,377 | 10,895 |
| 2016 | 7,943 | 7,985 |
| 2017 | 78,458 | 85,210 |
| 2018 | 105,443 | 55,485 |
| 2019 | 3,693 | |
| Later | 8,926 | 13,216 |
| Total | 215,839 | 264,337 |
| Interest-bearing liabilities are divided into currencies as follows: | ||
|---|---|---|
| EUR | 147,324 | 151,167 |
| SEK | 140,851 | 155,290 |
| DKK | 11,767 | 12,838 |
| RUB | 33,623 | 50,081 |
| LTL | 1,168 | 1,104 |
| Total | 334,733 | 370,479 |
| Finance lease obligations | ||
|---|---|---|
| Total amount of minimum lease payments: | ||
| In less than a year | 204 | 1,034 |
| Between one and fi ve years | 726 | 809 |
| After more than fi ve years | ||
| Total | 930 | 1,843 |
| Present value of minimum lease payments: | ||
| In less than a year | 173 | 1,000 |
| Between one and fi ve years | 625 | 770 |
| After more than fi ve years | ||
| Total | 798 | 1,770 |
| Future interest accumulation | 132 | 73 |
| Total | 930 | 1,843 |
| 2013 | 2012 | |
|---|---|---|
| Other liabilities | 6 | 2 |
| Derivative fi nancial instruments - in hedge accounting | 5,001 | 7,310 |
| Derivative fi nancial instruments - not in hedge accounting | 715 | 252 |
| Accruals and deferred income | 8 | 8 |
| Total | 5,730 | 7,572 |
| Non-current liabilities consist of the following currencies: | ||
| EUR | 5,730 | 5,983 |
| SEK | 0 | 1,589 |
| Other | ||
| Total | 5,730 | 7,572 |
| The benefi t-based pension liability in the balance sheet is determined as follows: | 2013 | 2012 |
|---|---|---|
| Present value of funded obligations | 6,926 | 8,132 |
| Fair value of assets | 0 | 0 |
| Defi cit(+)/Surplus(-) | 6,926 | 8,132 |
| Pension liability in the balance sheet | 6,926 | 8,132 |
| The benefi t-based pension cost is determined as follows: | ||
| Change in the arrangement | -2 | |
| Costs based on performances in the period | 125 | 124 |
| Benefi ts paid | -222 | -197 |
| Interest expenses | 256 | 259 |
| Pension costs in the profi t and loss account | 157 | 187 |
| Actuarial gains/losses | -1,104 | 410 |
| Pension costs in total comprehensive income | -1,104 | 410 |
| Changes to liabilities in the balance sheet: | ||
| Liability of the ITP2 pension arrangement at the beginning of the accounting period | 8,132 | 7,252 |
| Pension costs in the profi t and loss account and total comprehensive income | -947 | 597 |
| Exchange differences | -259 | 283 |
| At the end of the period | 6,926 | 8,132 |
| Actuarial assumptions used (%): | ||
| Discount rate | 4,00 | 3,20 |
| Infl ation rate | 2,00 | 2,00 |
The Group's Swedish companies have defi ned-benefi t pension arrangements (ITP2). Most of the ITP2 pension arrangements are provided by the occupational pension insurance company Alecta as multiple-employer arrangements, so the funds and liabilities within them cannot be allocated to an individual company. For this reason, the ITP2 pension arrangements managed by Alecta are treated as defi ned contribution plans in the fi nancial statements. The remaining ITP2 pension arrangements are fi nanced through the FPG/PRI system, and they are treated as defi ned benefi t plans as of the 2011 accounting period.
| 2013 | 2012 | |
|---|---|---|
| Trade payables | 97,031 | 94,153 |
| Advances received | 2,982 | 1,075 |
| Other liabilities | 26,309 | 30,200 |
| Derivative fi nancial instruments - in hedge accounting | 350 | 317 |
| Derivative fi nancial instruments - not in hedge accounting | 1,070 | 2,769 |
| Accruals and deferred income | 46,498 | 46,984 |
| Total | 174,240 | 175,498 |
Material items in accrued liabilities consist of personnel expenses and the amortisation of debt interests.
| Current liabilities consist of the following currencies: | 2013 | 2012 |
|---|---|---|
| EUR | 101,023 | 97,553 |
| SEK | 48,841 | 51,540 |
| RUB | 15,312 | 17,077 |
| DKK | 7,194 | 7,082 |
| USD | 492 | 878 |
| Other | 1,378 | 1,368 |
| Total | 174,240 | 175,498 |
The treasury policy approved by the Board of Directors defi nes the general principles of fi nancial risk management. The Board has delegated the management of fi nancial risks to the Treasury Committee, while the practical management of fi nancial risks is centrally handled by the Group's Treasury unit. The goal of fi nancial risk management is to reduce the effect that price fl uctuations on the fi nancial markets and other uncertainty factors have on earnings, the balance sheet and cash fl ow, as well as to ensure suffi cient liquidity. Treasury, together with the business areas, aims to identify, assess and hedge against all risks in accordance with the fi nancing policy. The main risks related to fi nancing are interest rate risk, currency risk, liquidity and refi nancing risk and credit risk. Commodity risks and capital structure management are also dealt with at the end of this section.
Interest rate risk is managed by dividing fi nancing into instruments with variable and fi xed interest rates and by hedging with interest rate derivatives. During the accounting period, the Group used interest rate swaps in interest rate risk management. The Group links interest rate risk management to the interest margin indicator forecast by dividing the 12-month rolling operating margin by the forecast net interest rate expenses. The lower the operating margin is in relation to net fi nancing costs, the larger is the share of debt that must have a fi xed interest rate. The Group's interest-bearing debt at the balance sheet date was EUR 334.7 million (EUR 370.5 million), of which EUR 185.0 million (EUR 184.5 million) or 55.3% (49.8%) had fi xed interest rates. The ratio of debt with fi xed and variable interest rates is at the level defi ned by the Group's fi nancing policy.
The interest rate risk is mainly directed at the Group's interest-bearing liabilities because the amount of money market investments and related interest rate risk is low. The Group's operational cash fl ow is to a large extent independent of fl uctuations in interest rates. At the balance sheet date, Atria Plc had four open interest rate swaps subject to hedge accounting.
The sensitivity analysis of net interest rate expenses is based on a 1% change in interest rates, which is considered to be reasonably realistic. It is calculated for year-end interest-bearing, variable-rate net liabilities that are expected to remain the same over the accounting period. The interest rate swaps are taken into account in the calculation. In simulations, the same change in interest rate is used for all currencies. On 31 December 2013, variable-rate net liabilities amounted to EUR 120.9 million (EUR 179.4 million). At the end of 2013, a +/-1% change in interest rates corresponded to a change of EUR +/-1.2 million in the Group's annual interest rate expenses (EUR +/-1.8 million). The effect on equity would be EUR 2.7 million (EUR 4.1 million) with a +1% change and EUR -2.8 million (EUR -4.3 million) with a -1% change.
Atria Group operates in many currency zones and is exposed to currency-related risks. Currency risks arise from forecast transactions, assets and liabilities booked into the balance sheet and net investments in the operations of foreign subsidiaries. The subsidiaries hedge the currency risk related to commercial, operational items according to their currency risk policy for each business area. Each currency risk policy has been approved by the Treasury Committee. In Finland and Sweden, hedge accounting is applied to the aforementioned currency hedges. Currency risk is monitored according to the 12-month rolling cash fl ow forecast, and hedges are carried out for periods of 1 to 6 months using forward exchange agreements. The cash fl ows hedged during this time are expected to occur and affect profi t or loss. Among other things, transaction risks come from the euro-denominated meat raw material imports of Atria's Swedish operations and from the USD-denominated imports of its Russian companies. In Atria's Finnish operations, currency fl ows and risks are relatively low and are mainly related to USD- and SEK-denominated exports.
The Group has net investments in the operations of foreign subsidiaries that are exposed to currency risks. The Treasury Committee decides on net investment hedges on a case-by-case basis. At the time of the fi nancial statements, there were no derivative agreements in force for net investment hedging. The parent company grants fi nancing to the subsidiaries in their home currencies and has hedged the currency-denominated loan receivables from the subsidiaries through currency loans and forward exchange agreements.
If, at the end of the accounting period, the euro had been 10% weaker/stronger than the Swedish krona (all other factors being equal), profi t before taxes would have been EUR 0.6 million higher/lower due to the Swedish subsidiaries' euro-denominated accounts payable (EUR 0.9 million). The effect on equity would have been EUR 0.5 million (EUR 0.7 million). Sensitivity analyses also take into account the effects of currency derivatives, which offset the effects of change in exchange rates.
If, at the end of the fi nancial period, the euro had been 10% weaker/stronger than the Russian rouble (all other factors being equal), profi t before taxes would have been EUR 0.1 million higher/lower due to the Russian subsidiaries' euro-denominated accounts payable (EUR 0.1 million). The effect on equity would have been EUR 0.0 million (EUR 0.0 million).
Atria Plc's Treasury raises the majority of the Group's interest-bearing capital. Liquidity and refi nancing risks are managed through a balanced loan maturity distribution and by having suffi cient committed credit limits with suffi ciently long periods of validity at hand, by using many fi nancial institutions and instruments to raise fi nance and by keeping a suffi cient amount of cash funds. Atria uses commercial papers actively for short-term fi nancing and liquidity management. There was EUR 148.2 million (EUR 153.0 million) in unutilised binding credit limits at the end of the year, and EUR 145.9 million (EUR 166.7 million) of the EUR 200 million commercial paper programme had not been used at the end of the accounting period. The average maturity of the Group's loans and committed credit limits was 3 years 4 months (2 years 10 months).
The main covenant used in loan agreements is a minimum equity ratio covenant of 30%. The Group's equity ratio has been approx. 40% for many years, and the Group will continue to ensure an equity ratio higher than the level required by the covenant. According to the terms of loan agreements, the implementation of covenants is reported to fi nanciers either quarterly or semi-annually.
According to the Group management's view, there was no signifi cant liquidity accumulation in fi nancial assets or fi nancial sources.
The table below shows the maturity analysis for fi nancial liabilities and derivative fi nancial instruments (undiscounted fi gures). The capital levies and revenue of derivative liabilities and assets are related to forward exchange agreements, and interest payments to interest rate swaps.
| EUR 1,000 | Maturity, 31 Dec 2013 | ||||
|---|---|---|---|---|---|
| < 1 year | 1–5 years | > 5 years | Total | ||
| Loans | Instalments | 118,590 | 206,418 | 8,926 | 333,934 |
| Interest payments | 6,171 | 20,366 | 425 | 26,962 | |
| Finance lease obligations | Instalments | 304 | 495 | 799 | |
| Derivative liabilities and assets *) | Capital payments | 163,100 | 163,100 | ||
| Capital income | -163,028 | -163,028 | |||
| Interest payments | 2,797 | 5,300 | 8,097 | ||
| Interest income | -702 | -1,075 | -1,777 | ||
| Other payables | Instalments | 9,578 | 9,578 | ||
| Trade payables | Payments | 97,031 | 97,031 | ||
| Accruals and deferred income | Payments | 46,498 | 8 | 46,506 | |
| Total | Total payments | 444,069 | 232,587 | 9,351 | 686,007 |
| Total income | -163,730 | -1,075 | -164,805 | ||
| Net payments | 280,339 | 231,512 | 9,351 | 521,202 |
| EUR 1,000 | Maturity, 31 Dec 2012 | ||||
|---|---|---|---|---|---|
| < 1 years | 1–5 years | > 5 years | Total | ||
| Loans | Instalments | 105,142 | 250,351 | 13,216 | 368,709 |
| Interest payments | 6,357 | 18,339 | 607 | 25,303 | |
| Finance lease obligations | Instalments | 1,000 | 770 | 1,770 | |
| Derivative liabilities and assets*) | Capital payments | 142,274 | 142,274 | ||
| Capital income | -145,271 | -145,271 | |||
| Interest payments | 3,367 | 8,167 | 11,534 | ||
| Interest income | -1,002 | -2,233 | -3,235 | ||
| Other liabilities | Instalments | 12,203 | 2 | 12,205 | |
| Trade payables | Payments | 94,179 | 94,179 | ||
| Accruals and deferred income | Payments | 47,009 | 8 | 47,017 | |
| Total | Total payments | 411,531 | 277,637 | 13,823 | 702,991 |
| Total income | -146,273 | -2,233 | -148,506 | ||
| Net payments | 268,258 | 275,404 | 13,823 | 554,485 |
*) There is a netting right agreement with all derivative counterparties. The derivative liability and asset fi gures in the table are gross amounts. If the fi gures were netted, derivative liabilities would be EUR 6.4 million (EUR 5.3 million).
Credit risk is managed at Group level in accordance with the Group's risk management policy approved by the Board of Directors. The credit risk related to fi nancing, i.e., the counterparty risk, is managed by selecting only well-established highly rated counterparties with good credit ratings as counterparties. The Group's liquid assets are only invested with counterparties that meet the above-mentioned criteria. This is also the procedure when entering into fi nancing and derivative agreements. The credit risk related to derivatives is also decreased by the fact that all payments made in relation to derivatives are net payments. Atria has only made derivatives with banks that are among Atria's main fi nanciers.
The credit risk of the Group's operative business is related to our customers, of which the main ones are large retail chains. Part of the Group's trade receivables are related to feed and animal trading in primary production. The credit risk related to this is higher, but also more dispersed. The Group's trade receivables are also dispersed over several market areas and many customers.
Credit loss risk is managed with securities, such as credit insurances and bank guarantees as well as with advance invoicing. Each business area has been assigned a separate credit policy that takes the special features of the market area into account. Credit risk is examined and monitored on a caseby-case basis for major customers and customer groups. The breakdown of trade receivables is illustrated in Note 20.
The Group is exposed to commodity risks, the most signifi cant of which are meat raw material and electricity. Fluctuations in the price of meat raw material affect profi tability in the short term, but efforts are made to pass on the price increases to sales prices as soon as possible.
Fluctuations in the price of electricity are hedged with forward electricity agreements according to the Group's electricity procurement policy. The hedging levels in the policy are shown in the table below.
| Period | Hedging level minimum |
Hedging level maximum |
|---|---|---|
| 1–12 months | 70% | 100% |
| 13–24 months | 40% | 80% |
| 25–36 months | 0% | 50% |
| 37–48 months | 0% | 40% |
| 49–60 months | 0% | 30% |
Hedge accounting in accordance with IFRS is applied to electricity hedges. The effective portion of changes in the value of derivatives, amounting to EUR -1.2 million (EUR -0.7 million), has been recognised under equity, and the ineffective portion, amounting to EUR -0.7 million (EUR -0.8 million), has been recognised in the income statement.
If the market price of electricity derivatives changed by +/-10% from the level of 31 December 2013, the effect on equity would be EUR +/-1.5 million (EUR +/-1.3 million), on the assumption that all hedges are 100% effective.
In capital structure management, the Group aims to ensure normal operating conditions under all circumstances and to maintain an optimal capital structure in terms of capital costs.
The Group monitors the development of its capital structure primarily through the equity ratio, for which the Group has set a target level of 40%. Based on this equity ratio, the company estimates that the availability and total cost of new capital are optimal.
Equity ratio is affected by balance sheet total and equity. The company is able to affect the balance sheet total and, thereby, the capital structure through the management of working capital, the amount of investments and the sale of business operations or assets. Correspondingly, the company can affect the amount of its own equity through dividend distribution and share issues.
In the assessment of investments and divestments, the Group uses the Group's weighted average cost of capital (WACC) as reference. This way, the Group tries to ensure that its assets generate at least an amount corresponding to the average cost of its capital.
| Realised | 31 Dec 2013 | 31 Dec 2012 |
|---|---|---|
| 42.2 % | 41.5 % |
| EUR 1,000 | Financial assets and liabilities recognised at fair value through |
Derivative fi nancial instruments under hedge |
Loans and other |
Financial assets available for |
Financial | Total balance |
|---|---|---|---|---|---|---|
| 2013 balance sheet item | profi t or loss | accounting | receivables | sale | liabilities | sheet value |
| Non-current assets | ||||||
| Trade receivables | 1,444 | 1,444 | ||||
| Other fi nancial assets | 2,189 | 2,189 | ||||
| Loan receivables | 4,884 | 4,884 | ||||
| Other receivables *) | 1,153 | 1,153 | ||||
| Accrued credits and deferred charges *) | 1 | 1 | ||||
| Current assets | ||||||
| Trade receivables | 93,624 | 93,624 | ||||
| Loan receivables | 2,651 | 2,651 | ||||
| Other receivables *) | 5,158 | 5,158 | ||||
| Accrued credits and deferred charges *) | 5,453 | 5,453 | ||||
| Derivative fi nancial instruments | 447 | 26 | 473 | |||
| Cash and cash equivalents | 28,844 | 28,844 | ||||
| Total fi nancial assets | 447 | 26 | 143,212 | 2,189 | 0 | 145,874 |
| Non-current liabilities | ||||||
| Loans | 215,344 | 215,344 | ||||
| Finance lease obligations | 495 | 495 | ||||
| Other liabilities **) | 0 | 0 | ||||
| Accruals and deferred income **) | 8 | 8 | ||||
| Derivative fi nancial instruments | 715 | 5,001 | 5,716 | |||
| Current liabilities | ||||||
| Loans | 118,590 | 118,590 | ||||
| Finance lease obligations | 304 | 304 | ||||
| Trade payables | 97,031 | 97,031 | ||||
| Other liabilities **) | 9,578 | 9,578 | ||||
| Accruals and deferred income **) | 46,498 | 46,498 | ||||
| Derivative fi nancial instruments | 1,070 | 350 | 1,420 | |||
| Total fi nancial liabilities | 1,785 | 5,351 | 0 | 0 | 487,848 | 494,984 |
*) Do not include VAT or income tax assets
**) Do not include VAT or income tax liabilities
Values of fi nancial assets and liabilities by category:
| EUR 1,000 | Financial assets and liabilities recognised at fair value through |
Derivative fi nancial instruments under hedge |
Loans and other |
Financial assets available for |
Financial | Total balance |
|---|---|---|---|---|---|---|
| 2012 balance sheet item | profi t or loss | accounting | receivables | sale | liabilities | sheet value |
| Non-current assets | ||||||
| Trade receivables | 3,364 | 3,364 | ||||
| Other fi nancial assets | 1,748 | 1,748 | ||||
| Loan receivables | 6,852 | 6,852 | ||||
| Other receivables *) | 1,298 | 1,298 | ||||
| Accrued credits and deferred charges *) | 21 | 21 | ||||
| Current assets | ||||||
| Trade receivables | 114,068 | 114,068 | ||||
| Loan receivables | 2,673 | 2,673 | ||||
| Other receivables *) | 5,860 | 5,860 | ||||
| Accrued credits and deferred charges *) | 10,123 | 10,123 | ||||
| Derivative fi nancial instruments | 55 | 51 | 106 | |||
| Cash and cash equivalents | 6,556 | 6,556 | ||||
| Total fi nancial assets | 55 | 51 | 150,815 | 1,748 | 0 | 152,669 |
| Non-current liabilities | ||||||
| Loans | 263,567 | 263,567 | ||||
| Finance lease obligations | 770 | 770 | ||||
| Other liabilities **) | 2 | 2 | ||||
| Accruals and deferred income **) | 8 | 8 | ||||
| Derivative fi nancial instruments | 252 | 7,310 | 7,562 | |||
| Current liabilities | ||||||
| Loans | 105,142 | 105,142 | ||||
| Finance lease obligations | 1,000 | 1,000 | ||||
| Trade payables | 94,153 | 94,153 | ||||
| Other liabilities **) | 12,203 | 12,203 | ||||
| Accruals and deferred income **) | 46,984 | 46,984 | ||||
| Derivative fi nancial instruments | 2,769 | 317 | 3,086 | |||
| Total fi nancial liabilities | 3,021 | 7,627 | 0 | 0 | 523,829 | 534,477 |
*) Do not include VAT or income tax assets
**) Do not include VAT or income tax liabilities
Fair value hierarchy:
EUR 1,000
| Balance sheet item | 31 Dec 2013 | Level 1 | Level 2 | Level 3 |
|---|---|---|---|---|
| Non-current assets | ||||
| Financial assets available for sale | ||||
| - Listed shares | 220 | 220 | ||
| - Unlisted shares | 1,969 | 1,969 | ||
| Current assets | ||||
| Derivative fi nancial instruments | 473 | 473 | ||
| Total | 2,662 | 220 | 473 | 1,969 |
| Non-current liabilities | ||||
| Derivative fi nancial instruments | 5,716 | 5,716 | ||
| Current liabilities | ||||
| Derivative fi nancial instruments | 1,420 | 1,420 | ||
| Total | 7,136 | 0 | 7,136 | 0 |
| Balance sheet item | 31 Dec 2012 | Level 1 | Level 2 | Level 3 |
|---|---|---|---|---|
| Non-current assets | ||||
| Financial assets available for sale | ||||
| - Listed shares | 182 | 182 | ||
| - Unlisted shares | 1,566 | 1,566 | ||
| Current assets | ||||
| Derivative fi nancial instruments | 106 | 106 | ||
| Total | 1,854 | 182 | 106 | 1,566 |
| Non-current liabilities | ||||
| Derivative fi nancial instruments | 7,562 | 7,562 | ||
| Current liabilities | ||||
| Derivative fi nancial instruments | 3,086 | 3,086 | ||
| Total | 10,648 | 0 | 10,648 | 0 |
The fair value of fi nancial instruments traded in active markets is based on market prices listed on the closing date. Markets are regarded as active if listed prices are readily and regularly available from the stock exchange, broker, industry group, price information service or surveillance authority, and these prices represent actual and regularly occurring market events between independent parties. The current purchase price is used as the listed market price for fi nancial assets.
A fair value is established through valuation techniques for fi nancial instruments that are not traded in active markets (such as OTC derivatives). These valuation techniques make maximum use of observable market information, when available, and rely as little as possible on company-specifi c assessments. If all signifi cant input required for determining the fair value of the instrument is observable, the instrument is on level 2.
If one or more signifi cant piece of input information is not based on observable market information, the instrument is classifi ed on level 3. Assessments by external parties are used for measurement of fi nancial instruments and, if such assessments are not available, the company's own calculations/ assessments are used.
| Unlisted shares | 2013 | 2012 |
|---|---|---|
| Opening balance 1 Jan | 1,566 | 1,471 |
| Purchases | 403 | 99 |
| Decreases | -4 | |
| Closing balance 31 Dec | 1,969 | 1,566 |
| Fair values of derivative fi nancial instruments EUR 1,000 |
Derivative assets 31 Dec 2013 |
Derivative liabilities 31 Dec 2013 |
Net fair value 31 Dec 2013 |
Net fair value 31 Dec 2012 |
|---|---|---|---|---|
| Forward exchange agreements | ||||
| Cash fl ow hedges under IAS 39 hedge accounting | 26 | 20 | 6 | 4 |
| Other hedges | 447 | 447 | -1,924 | |
| Interest rate swaps, due in more than one year | ||||
| Cash fl ow hedges under IAS 39 hedge accounting | 4,097 | -4,097 | -6,849 | |
| Electricity derivatives | ||||
| Cash fl ow hedges under IAS 39 hedge accounting | 3,019 | -3,019 | -1,773 | |
| Other hedges | 0 | |||
| Total | 473 | 7,136 | -6,663 | -10,542 |
| EUR 1,000 | 31 Dec 2013 | 31 Dec 2012 |
|---|---|---|
| Forward exchange agreements | ||
| Cash fl ow hedges under IAS 39 hedge accounting | 9,373 | 12,502 |
| Other hedges | 140,997 | 128,622 |
| Interest rate swaps | ||
| Cash fl ow hedges under IAS 39 hedge accounting | 131,765 | 133,113 |
| Electricity derivatives | ||
| Cash fl ow hedges under IAS 39 hedge accounting | 18,373 | 16,008 |
| Other hedges | 565 | 488 |
| Total | 301,073 | 290,733 |
| Group as lessee | 2013 | 2012 |
|---|---|---|
| Minimum lease payments based on non-cancellable leases | ||
| Within one year | 9,294 | 6,325 |
| Within more than one year and a maximum of fi ve years | 22,930 | 12,122 |
| After more than fi ve years | 12,743 | 10,132 |
| Total | 44,967 | 28,579 |
| Rents recognised as cost | 6,830 | 6,507 |
The terms and conditions of the leases vary. The Group companies rent properties, machinery and equipment.
| Debts with mortgages or other collateral given as security | 2013 | 2012 |
|---|---|---|
| Loans from fi nancial institutions | 2,784 | 2,956 |
| Pension fund loans | 5,610 | 5,692 |
| Total | 8,394 | 8,648 |
| Mortgages and other securities given as comprehensive security | ||
| Real estate mortgages | 3,973 | 4,182 |
| Corporate mortgages | 1,355 | 1,398 |
| Total | 5,328 | 5,580 |
| Contingent liabilities not included in the balance sheet | ||
| Guarantees | 636 | 441 |
| Ownership | Share of votes | ||
|---|---|---|---|
| Group joint ventures and associates and other related parties | Domestic | interest (%) | (%) |
| Group joint ventures: | |||
| Honkajoki Oy | Finland | 50.0 | 50.0 |
| Finnish Meat Research Institute, LTK Co-operative | Finland | 50.0 | 50.0 |
| Länsi-Kalkkuna Oy | Finland | 50.0 | 50.0 |
| Group and associates: | |||
| Domretor Oy | Finland | 24.9 | 24.9 |
| Findest Protein Oy | Finland | 41.7 | 41.7 |
| Finnpig Oy | Finland | 50.0 | 50.0 |
| Foodwest Oy | Finland | 33.5 | 33.5 |
| Kiinteistö Oy Itikanmäen Teollisuustalo | Finland | 13.2 | 13.2 |
| Transbox Oy | Finland | 25.7 | 25.7 |
| Tuoretie Oy | Finland | 33.3 | 33.3 |
| Other related parties: | |||
| Members of the Board of Directors and Supervisory Board | |||
| CEO, Deputy CEO and the Group's Management Team | |||
| Itikka Co-operative Group | |||
| Lihakunta | |||
| Pohjanmaan Liha Co-operative Group | |||
| Joint | |||
| ventures and | Other related | ||
| Transactions with the related parties and related-party assets and liabilities | associates | parties | Total |
| 1 Jan –31 Dec 2013 | |||
| Sale of goods | 2,235 | 5,063 | 7,298 |
| Sale of services | 133 | 117 | 250 |
| Rental income | 96 | 18 | 114 |
| Purchase of goods | 20,160 | 10,437 | 30,597 |
| Purchase of services | 50,677 | 259 | 50,936 |
| Rental costs | 18 | 2,728 | 2,746 |
| 31 Dec 2013 | |||
| Trade receivables | 195 | 382 | 577 |
| Other receivables | 472 | 36 | 508 |
| Trade payables | 5,210 | 54 | 5,264 |
| Other liabilities | 0 | 2,172 | 2,172 |
| Joint | |||
| ventures and | Other related | ||
| Transactions with the related parties and related-party assets and liabilities | associates | parties | Total |
| 1 Jan –31 Dec 2012 | |||
| Sale of goods | 2,240 | 8,352 | 10,592 |
| Sale of services | 644 | 90 | 734 |
| Rental income | 318 | 47 | 365 |
| Purchase of goods | 19,411 | 7,608 | 27,019 |
| Purchase of services | 48,753 | 204 | 48,957 |
| Rental costs | 10 | 2,659 | 2,669 |
| 31 Dec 2012 | |||
| Trade receivables | 259 | 451 | 710 |
| Other receivables | 105 | 14 | 119 |
| Trade payables | 3,567 | 4 | 3,571 |
| Other liabilities | 0 | 3,623 | 3,623 |
The sale of goods and services to related parties is based on the Group's valid price lists. The majority of services purchased were the logistics services of Tuoretie Oy. Debts to related parties are loans that can be called in immediately or as agreed; their interest rate is tied to the 3-month or 6-month Euribor rate.
| Employee benefi ts and fees of the Group's key managerial personnel (on an accrual basis) | 2013 | 2012 |
|---|---|---|
| Short-term employee benefi ts | 2,434 | 2,385 |
| Post-employment benefi ts (pension group benefi ts) | 270 | 300 |
| Benefi ts paid upon termination of employment | 337 | 317 |
| Total | 3,040 | 3,001 |
The Group's key managerial personnel consists of the members of the Board of Directors and the Supervisory Board, the CEO and Deputy CEO and the members of the Group's management team.
For the CEO and Deputy CEO, the retirement age is 63 years.
Managerial group pension benefi ts have been arranged for the members of Atria Group's management team who are within the scope of Finnish social security. The retirement age of the group pension insurance is 63 years for the members of the management team. The pension plan is contributiondefi ned, and the annual payment is based on the monthly salary (monetary salary and fringe benefi ts) of the insured.
| Statutory | Supplementary | |||
|---|---|---|---|---|
| Salaries, benefi ts and other employee benefi ts for the Supervisory | Salaries and | pension | pension | |
| Board, Board of Directors, CEO and Deputy CEO | benefi ts | contributions | contributions | Total |
| Members of the Supervisory Board: | ||||
| Hyry Hannu, Chairman from 4/2013 | 26 | 3 | 29 | |
| Pirkola Ari, Chairman until 4/2013 | 14 | 2 | 15 | |
| Anttikoski Juho, Deputy Chairman | 23 | 3 | 26 | |
| Other members of the Supervisory Board, total | 49 | 49 | ||
| Members of the Board of Directors: | ||||
| Paavola Seppo, Chairman | 75 | 9 | 84 | |
| Komulainen Timo, Deputy Chairman | 76 | 9 | 85 | |
| Heikkilä Tuomo, member until 4/2013 | 13 | 2 | 14 | |
| Kaarto Esa | 53 | 6 | 59 | |
| Paxal Kjell-Göran | 40 | 5 | 45 | |
| Rantsi Jyrki, member from 4/2013 | 21 | 2 | 23 | |
| Romanainen Maisa | 23 | 3 | 26 | |
| Sivula Harri | 27 | 3 | 30 | |
| CEO: | ||||
| Gröhn Juha | 514 | 61 | 141 | 717 |
| Deputy CEO: | ||||
| Ruohola Juha | 265 | 32 | 73 | 369 |
Atria Plc acquired HKScan Finland Oy's shares in pet food manufacturer Best-In Oy on 20 December 2012. Atria Plc and HKScan Finland Oy previously each held a 50 per cent interest in Best-In Oy, established in 2002. Following this acquisition, Atria Plc owns the entire share capital of Best-In Oy.
Best-In Oy is located in Kuopio, Finland and its net sales in 2012 were EUR 5.1 million. The company has 19 employees. Best-In Oy owns the Best-In, Hubert and CAT pet food brands.
Atria seeks to benefi t from the growth of the pet food market. Best-In's well-known brands and market leadership in Finland offer Atria an excellent opportunity to expand the business. The operations are focused on the domestic market and especially on fresh dog food solutions, an area in which Best-In stands out as the market leader and productisation forerunner.
| Fair values | |
|---|---|
| used in the | |
| Best-In Oy | acquisition |
| Property, plant and equipment | 775 |
| Intangible assets | |
| Brands | 2,500 |
| Goodwill | 1,080 |
| Inventories | 605 |
| Short-term receivables | 113 |
| Cash in hand and at bank | 172 |
| Total assets | 5,245 |
| Non-current liabilities | 104 |
| Deferred tax liabilities | 638 |
| Current liabilities | 503 |
| Total liabilities | 1,245 |
| Net assets | 4,000 |
| Purchase price for 50% of the shares | 2,000 |
| Effect of the acquisition on cash fl ow | 1,828 |
Best-In Oy, which used to be a joint venture of the Group, has been consolidated using the equity method. The acquisition generated a profi t of EUR 1.5 million, which results from the valuation at fair value of the previous 50% holding. The profi t in question is reported in the income statement after EBIT under "Income from joint ventures and associates".
Best-In Oy's income for the 2012 accounting period has been consolidated using the equity method.
The preliminary calculation made in the 2012 accounting period has not changed.
Atria Plc and Saarioinen Oy signed a preliminary agreement in July under which Atria will purchase Saarioinen's procurement, slaughtering and cutting operations for beef, pork and chicken. In conjunction with the deal, Atria and Saarioinen signed an agreement concerning meat deliveries from Atria to Saarioinen. The operations covered by the deal employ about 400 people on average. As a result of the deal, Atria's net sales are projected to grow by around EUR 70 million per year. On 21 January 2014, the Finnish Competition and Consumer Authority announced its approval of the acquisition. The operations were consolidated into Atria as of 1 February 2014. The purchase price was approximately EUR 30 million, and it was paid using cash funds and borrowed capital. The acquisition had no material effect on the Group's key fi gures.
| Ownership | Share of | ||
|---|---|---|---|
| Group companies by business area | Domestic | interest (%) | votes (%) |
| Atria Finland: | |||
| Ab Botnia-Food Oy | Finland | 100.0 | 100.0 |
| A-Lihatukkurin Oy | Finland | 100.0 | 100.0 |
| A-Logistics Ltd | Finland | 100.0 | 100.0 |
| A-Pekoni Nurmo Oy | Finland | 100.0 | 100.0 |
| A-Pihvi Kauhajoki Oy | Finland | 100.0 | 100.0 |
| A-Pihvi Kuopio Oy | Finland | 100.0 | 100.0 |
| A-Rehu Oy | Finland | 51.0 | 51.0 |
| A-Sikateurastamo Oy | Finland | 100.0 | 100.0 |
| Atria Plc | Finland | ||
| Atria Finland Ltd | Finland | 100.0 | 100.0 |
| Atria-Chick Oy | Finland | 100.0 | 100.0 |
| Atria-Lihavalmiste Oy | Finland | 100.0 | 100.0 |
| Atria-Meetvursti Oy | Finland | 100.0 | 100.0 |
| Atria-Tekniikka Oy | Finland | 100.0 | 100.0 |
| Atria-Tuoreliha Oy | Finland | 100.0 | 100.0 |
| Atria-Valmisruoka Oy | Finland | 100.0 | 100.0 |
| A-Farmers Ltd | Finland | 97.9 | 99.0 |
| Best-In Oy | Finland | 100.0 | 100.0 |
| F-Logistiikka Oy | Finland | 100.0 | 100.0 |
| Itikka-Lihapolar Oy | Finland | 100.0 | 100.0 |
| Kauhajoen Teurastamokiinteistöt Oy | Finland | 100.0 | 100.0 |
| Kiinteistö Oy Tievapolku 3 | Finland | 100.0 | 100.0 |
| Liha ja Säilyke Oy | Finland | 100.0 | 100.0 |
| Mestari Forsman Oy | Finland | 100.0 | 100.0 |
| Rokes Oy | Finland | 100.0 | 100.0 |
| Suomen Kalkkuna Oy | Finland | 100.0 | 100.0 |
| Atria Scandinavia: | |||
| 3-Stjernet A/S | Denmark | 100.0 | 100.0 |
| Atria Concept AB | Sweden | 100.0 | 100.0 |
| Atria Concept SP Z.o.o | Poland | 100.0 | 100.0 |
| Atria Denmark A/S | Denmark | 100.0 | 100.0 |
| Atria Foodservice AB | Sweden | 100.0 | 100.0 |
| Atria Retail AB | Sweden | 100.0 | 100.0 |
| Atria Scandinavia AB | Sweden | 100.0 | 100.0 |
| Atria Sverige AB | Sweden | 100.0 | 100.0 |
| Falbygdens Ostnederlag AB | Sweden | 100.0 | 100.0 |
| KB Joddlaren | Sweden | 100.0 | 100.0 |
| Nordic Fastfood AB | Sweden | 51.0 | 51.0 |
| Nordic Fastfood Etablerings AB | Sweden | 51.0 | 51.0 |
| Ridderheims AS | Norway | 100.0 | 100.0 |
| Ridderheims Falbygdens AB | Sweden | 100.0 | 100.0 |
| Atria Russia: | |||
| Atria-Invest Oy | Finland | 100.0 | 100.0 |
| OOO CampoFerma | Russia | 100.0 | 100.0 |
| OOO MPZ CampoMos | Russia | 100.0 | 100.0 |
| OOO Pit-Product | Russia | 100.0 | 100.0 |
| Atria Baltic: | |||
| Atria Eesti AS | Estonia | 100.0 | 100.0 |
| Atria Farmid OÜ | Estonia | 100.0 | 100.0 |
| OÜ Atria | Estonia | 100.0 | 100.0 |
| UAB Vilniaus Mesa | Lithuania | 100.0 | 100.0 |
| Note | 1 Jan-31 Dec 2013 |
1 Jan-31 Dec 2012 |
|
|---|---|---|---|
| NET SALES | 2.1 | 39,682 | 41,284 |
| Other operating income | 2.2 | 2,832 | 2,726 |
| Personnel expenses | 2.3 | -2,510 | -2,620 |
| Depreciation and impairment | 2.4 | ||
| Planned depreciation | -22,479 | -22,747 | |
| Other operating expenses | 2.5 | -6,019 | -5,973 |
| EBIT | 11,507 | 12,670 | |
| Financial income and | |||
| expenses | 2.6 | -29,703 | 3,919 |
| PROFIT/LOSS BEFORE APPROPRIATIONS AND |
|||
| TAXES | -18,197 | 16,589 | |
| Appropriations | 2.7 | -5,523 | -4,017 |
| Income taxes | 2.8 | -388 | -1,610 |
| PROFIT/LOSS FOR | |||
| THE PERIOD | -24,107 | 10,963 |
| A s s e t s | Note | 31 Dec 2013 | 31 Dec 2012 |
|---|---|---|---|
| FIXED ASSETS | |||
| Intangible assets | 3.1 | ||
| Intangible rights | 17 | 25 | |
| Other long-term | |||
| expenditure | 5,261 | 4,280 | |
| Total intangible assets | 5,278 | 4,305 | |
| Tangible assets | 3.1 | 218,699 | 227,105 |
| Investments | 3.2 | ||
| Interests in Group | |||
| companies | 266,276 | 259,929 | |
| Interests in associates | 3,861 | 3,592 | |
| Other shares and interests | 2,003 | 1,580 | |
| Total investments | 272,140 | 265,100 | |
| TOTAL FIXED ASSETS | 496,117 | 496,510 | |
| CURRENT ASSETS | |||
| Long-term receivables | 3.3 | 293,888 | 321,448 |
| Short-term receivables | 3.3 | 79,655 | 106,694 |
| Cash in hand and at bank | 25,867 | 1,553 | |
| TOTAL CURRENT ASSETS | 399,410 | 429,695 | |
| T o t a l a s s e t s | 895,527 | 926,205 | |
| L i a b i l i t i e s | Note | 31 Dec 2013 | 31 Dec 2012 |
| EQUITY | 3.4 | ||
| Share capital | 48,055 | 48,055 | |
| Share premium | 138,502 | 138,502 | |
| Treasury shares | -1,277 | -1,277 | |
| Invested unrestricted equity | |||
| fund | 110,228 | 110,228 | |
| Retained earnings | 88,802 | 84,034 | |
| Profi t for the period | -24,107 | 10,963 | |
| TOTAL EQUITY | 360,202 | 390,504 | |
| ACCRUED APPROPRIATIONS | 3.5 | ||
| Depreciation difference | 78,554 | 73,031 | |
| LIABILITIES | |||
| Non-current liabilities | 3.6 | 211,622 | 258,870 |
| Current liabilities | 3.7 | 245,149 | 203,800 |
| TOTAL LIABILITIES | 456,771 | 462,670 | |
| T o t a l l i a b i l i t i e s | 895,527 | 926,205 |
| 1 Jan-31 Dec 2013 |
1 Jan-31 Dec 2012 |
|
|---|---|---|
| CASH FLOW FROM OPERATING ACTIVITIES |
||
| Sales income | 40,238 | 41,101 |
| Other business revenue | 2,832 | 2,726 |
| Payments on operating expenses | -5,991 | -8,293 |
| Cash fl ow from operating activities | ||
| before fi nancial items and taxes | 37,079 | 35,534 |
| Financial income and | ||
| expenses, net | -2,955 | 4,444 |
| Tax paid | 1,023 | -2,665 |
| Cash fl ow from operating activities | 35,147 | 37,314 |
| CASH FLOW FROM INVESTMENTS | ||
| Investments in tangible and | ||
| intangible assets and investments | -45,086 | -16,888 |
| Change in Group receivables | 49,029 | -30,504 |
| Cash fl ow from investments | 3,942 | -47,392 |
| CASH FLOW FROM FINANCING | ||
| Loan payments | -29,861 | -31,015 |
| Change in Group liabilities | 21,280 | 53,771 |
| Dividends paid | -6,194 | -5,631 |
| Group contribution | 0 | -7,300 |
| Cash fl ow from fi nancing | -14,775 | 9,825 |
| CASH FLOW FROM OPERATING ACTIVITIES |
35,147 | 37,314 |
| CASH FLOW FROM INVESTMENTS | 3,942 | -47,392 |
| CASH FLOW FROM FINANCING | -14,775 | 9,825 |
| TOTAL | 24,314 | -253 |
| Change in cash and cash equivalents |
||
| Cash and cash equivalents 1 Jan | -1,553 | -1,806 |
| Cash and cash equivalents 31 Dec | 25,867 | 1,553 |
| Change | 24,314 | -253 |
Atria Plc's fi nancial statements have been drawn up in accordance with Finland's Accounting Act and the other rules and regulations pertaining to the compilation of fi nancial statements (FAS).
Atria Plc is the parent company of Atria Group, and its domicile is in Kuopio, Finland. Copies of Atria Plc's fi nancial statements are available from the company's head offi ce at Itikanmäenkatu 3, Seinäjoki, postal address: PO Box 900, FI-60060 ATRIA.
In the balance sheet, tangible and intangible assets are entered at their direct acquisition cost less planned depreciation and value adjustments. Depreciation is implemented on a straight-line basis over the service life of the assets. Contributions received for the acquisition of tangible assets are entered as a decrease in acquisition costs. These contributions are not signifi cant.
| Depreciation periods: | ||
|---|---|---|
| Buildings | Nurmo | 40 years |
| other locations | 25 years | |
| Machinery and equipment | Nurmo | 10 years |
| other locations | 7 years | |
| Computer software | 5 years | |
| Other long-term items | 10 years |
The publicly listed companies' shares in the company's fi xed assets investments have been measured at acquisition cost. The book value of the shares on 31 December 2013 was EUR 29,326.86 and their fair value was EUR 130,892.02.
In the balance sheet, fi nancial instruments are measured at acquisition cost less value adjustments.
Items expressed in foreign currencies have been converted into euro at the exchange rate quoted by the European Central Bank. The exchange differences of the realised currency-denominated loans are presented under fi nancial items.
The company enters into derivative agreements in order to control exchange differences and interest rate levels. The derivatives used are forward exchange agreements and interest rate swaps.
The derivatives hedge accounting is not applied to are measured at fair value. All profi ts and losses resulting from fair value recognition are presented under the fi nancial items of the income statement. The positive fair value of the derivatives used for hedging is presented under receivables and the negative fair value under liabilities.
The derivatives hedge accounting is applied to are recognised in the proper item of the income statement on their expiration date.
The fair values of all derivatives are presented in Note 4.3.
| 2. NOTES TO THE INCOME | 1 Jan– | 1 Jan– |
|---|---|---|
| STATEMENT | 31 Dec 2013 | 31 Dec 2012 |
| 2.1. NET SALES, EUR 1,000 |
| Net sales | 39,682 | 41,284 |
|---|---|---|
The company's rental income is presented as net sales because it corresponds to the present nature of the company's operations.
| Service charges to Group companies | 2,828 | 2,706 |
|---|---|---|
| Other | 4 | 19 |
| Total | 2,832 | 2,726 |
| Average number of personnel | ||
|---|---|---|
| Clerical personnel in Finland | 10 | 10 |
| Personnel expenses | ||
| Salaries: CEO, Deputy CEO and members of the Board of Directors |
1,351 | 1,177 |
| Members of the Supervisory Board | 98 | 110 |
| Other salaries | 332 | 547 |
| Total | 1,782 | 1,833 |
| Pension costs | 648 | 697 |
| Other personnel-related expenses | 80 | 90 |
| Total | 728 | 787 |
| Total personnel expenses | 2,510 | 2,620 |
Pension commitments of members of the Board and CEO: The company's statutory pensions are defi ned contribution plans and have been arranged through an insurance company. The company does not have pension commitments for the CEO and the members of the Board of Directors and the Supervisory Board.
| Depreciations of tangible and intangible | ||
|---|---|---|
| assets | 22,479 | 22,747 |
Depreciation specifi cation per balance sheet item included in section 3.1.
Other operating expenses 6,019 5,973 Including administration, marketing, energy, cleaning, operational and other costs as well as fees paid to auditors.
| Fees paid to auditors / PricewaterhouseCoopers Oy |
||
|---|---|---|
| Auditing fees | 110 | 185 |
| Tax consulting | 1 | 2 |
| Other remunerations | 2 | 11 |
| Total | 113 | 197 |
The presented fi gures are based on invoicing.
| Return on long-term investments | ||
|---|---|---|
| From Group companies | 1,190 | 5,443 |
| From other companies | 80 | 674 |
| Total | 1,270 | 6,117 |
| Other interest and fi nancial income | ||
| From Group companies | 9,019 | 12,647 |
| From other companies | 8,112 | 7,618 |
| Total | 17,131 | 20,266 |
| Interest expenses and other fi nancial expenses | ||
| To group companies | 755 | 1,021 |
| Impairment on the Group's investments | 26,500 | 0 |
| To other companies | 20,849 | 21,443 |
| Total | 48,104 | 22,464 |
| Total fi nancial income and expenses | -29,703 | 3,919 |
| Interest expenses and other fi nancial expenses | ||
| include exchange rate losses (net) | 34 | -31 |
| Difference between planned depreciation and depreciation implemented in taxation |
-5,523 | -4,017 |
|---|---|---|
| 2.8. INCOME TAXES, EUR 1,000 |
| Income taxes on operations 388 |
|---|
| ----------------------------------- |
TANGIBLE ASSETS 31 Dec 2013 31 Dec 2012
| Intangible assets: | ||
|---|---|---|
| Intangible rights | ||
| Acquisition cost 1 Jan | 1,455 | 1,455 |
| Increases | 0 | 0 |
| Decreases | 0 | 0 |
| Acquisition cost 31 Dec | 1,455 | 1,455 |
| Accumulated depreciation 1 Jan | -1,430 | -1,420 |
| Depreciation on decreases | 0 | 0 |
| Depreciation for the accounting period | -8 | -10 |
| Accumulated depreciation 31 Dec | -1,438 | -1,430 |
| Book value 31 Dec | 17 | 25 |
| Other long-term expenditure | ||
| Acquisition cost 1 Jan | 18,949 | 17,318 |
| Increases | 2,311 | 1,658 |
| Decreases | 0 | -28 |
| Acquisition cost 31 Dec | 21,260 | 18,949 |
| Accumulated depreciation 1 Jan | -14,668 | -13,395 |
| Depreciation on decreases | 0 | 0 |
| Depreciation for the accounting period | -1,330 | -1,273 |
| Accumulated depreciation 31 Dec | -15,999 | -14,668 |
| Book value 31 Dec | 5,261 | 4,280 |
| Total intangible assets | 5,278 | 4,305 |
| Tangible assets: | ||
| Land and water | ||
| Acquisition cost 1 Jan | 1,233 | 1,233 |
| Decreases | 0 | 0 |
| Acquisition cost 31 Dec | 1,233 | 1,233 |
| Buildings and structures | ||
| Acquisition cost 1 Jan | 290,639 | 280,853 |
| Increases | 2,820 | 10,147 |
| Decreases | 0 | -361 |
| Acquisition cost 31 Dec | 293,459 | 290,639 |
| Accumulated depreciation 1 Jan | -136,673 | -129,792 |
| Depreciation on decreases | 0 | 0 |
| Depreciation for the accounting period | -6,693 | -6,881 |
| Accumulated depreciation 31 Dec | -143,367 | -136,673 |
| Book value 31 Dec | 150,093 | 153,965 |
| Machinery and equipment | ||
| Acquisition cost 1 Jan | 296,383 | 282,535 |
| Increases | 4,586 | 14,350 |
| Decreases | -51 | -502 |
| Acquisition cost 31 Dec | 300,917 | 296,383 |
| Accumulated depreciation 1 Jan Depreciation on decreases |
-228,238 0 |
-213,790 0 |
| Depreciation for the accounting period | -14,312 | -14,448 |
| Accumulated depreciation 31 Dec | -242,550 | -228,238 |
| Book value 31 Dec | 58,367 | 68,145 |
| 31 Dec 2013 | 31 Dec 2012 | |
|---|---|---|
| Other tangible assets | ||
| Acquisition cost 1 Jan | 2,298 | 2,235 |
| Increases | 26 | 63 |
| Decreases | 0 | 0 |
| Acquisition cost 31 Dec | 2,324 | 2,298 |
| Accumulated depreciation 1 Jan | -1,157 | -1,022 |
| Depreciation on decreases | 0 | 0 |
| Depreciation for the accounting period | -136 | -135 |
| Accumulated depreciation 31 Dec | -1,293 | -1,157 |
| Book value 31 Dec | 1,031 | 1,141 |
| Advance payments and | ||
| acquisitions in progress | ||
| Acquisition cost 1 Jan | 2,620 | 13,192 |
| Changes +/- | 5,354 | -10,572 |
| Acquisition cost 31 Dec | 7,974 | 2,620 |
| Tangible assets total | 218,699 | 227,105 |
| Non-depreciated acquisition cost of | ||
| machinery and equipment | 58,367 | 68,145 |
The share of items other than production machinery and equipment is not signifi cant. The acquisition costs of completely depreciated and scrapped items are presented as decreases.
| Parent company holding % |
Parent company holding % |
|
|---|---|---|
| 2013 | 2012 | |
| Group companies: | ||
| Ab Botnia-Food Oy, Seinäjoki | 100 | 100 |
| Atria Eesti AS, Valga, Estonia | 100 | 100 |
| Atria Scandinavia AB, Sköllersta, Sweden | 100 | 100 |
| Atria Finland Ltd, Kuopio | 100 | 100 |
| Atria-Invest Oy, Seinäjoki | 100 | 100 |
| A-Farmers Ltd, Seinäjoki | 97,9 | 97,9 |
| Best-In Oy, Kuopio | 100 | 100 |
| Kauhajoen Teurastamokiinteistöt Oy, Kauhajoki |
100 | 100 |
| Kiinteistö Oy Tievapolku 3, Helsinki | 100 | 100 |
| Liha ja Säilyke Oy, Forssa | 63,2 | 63,2 |
| Mestari Forsman Oy, Seinäjoki | 100 | 100 |
| OÜ Atria, Tallinn, Estonia | 100 | 100 |
| Rokes Oy, Forssa | 100 | 100 |
| Suomen Kalkkuna Oy, Seinäjoki | 100 | 100 |
| UAB Vilniaus Mesa, Vilna, Lithuania | 100 | 100 |
| Joint ventures and associates: | ||
| Foodwest Oy, Seinäjoki | 33,5 | 33,5 |
| Honkajoki Oy, Honkajoki | 50,0 | 50,0 |
| Kiinteistö Oy Itikanmäen Teollisuustalo, Seinäjoki |
13,2 | 13,2 |
| Finnish Meat Research Institute, | ||
| Hämeenlinna | 50,0 | 40,7 |
| Länsi-Kalkkuna Oy, Säkylä | 50,0 | 50,0 |
| Transbox Oy, Helsinki | 18,6 | 18,6 |
| Tuoretie Oy, Helsinki | 33,3 | 33,3 |
| 3.3. RECEIVABLES, EUR 1,000 | 31 Dec 2013 | 31 Dec 2012 |
|---|---|---|
| Long-term receivables: | ||
| Receivables from Group companies: | ||
| Loan receivables | 293,888 | 321,448 |
| Short-term receivables: | ||
| Loan receivables | 0 | 132 |
| Trade receivables | 29 | 51 |
| Other receivables | -4 | 21 |
| Accrued credits and deferred charges | 350 | 1,239 |
| Receivables from Group companies: | ||
| Trade receivables | 1,255 | 1,789 |
| Other receivables | 75,479 | 100,290 |
| Accrued credits and deferred charges | 2,545 | 3,172 |
| Total current receivables | 79,655 | 106,694 |
| Material items included in the accrued credits and deferred charges: |
||
| - amortised interests | 2,466 | 3,222 |
| - exchange rate difference of | ||
| forward contracts | 283 | 0 |
| - amortised taxes | 0 | 1,086 |
| - other | 146 | 103 |
| Total | 2,895 | 4,411 |
| 3.4. EQUITY, EUR 1,000 | 31 Dec 2013 | 31 Dec 2012 |
| Share capital 1 Jan | 48,055 | 48,055 |
| Share capital 31 Dec | 48,055 | 48,055 |
| Share premium 1 Jan | 138,502 | 138,502 |
| Share premium 31 Dec | 138,502 | 138,502 |
| Restricted equity total | 186,557 | 186,557 |
| Own shares 1 Jan | -1,277 | -1,277 |
| Acquisition of own shares Own shares 31 Dec |
0 -1,277 |
0 -1,277 |
| Invested unrestricted equity fund 1 Jan | 110,228 | 110,228 |
| Invested unrestricted equity fund 31 Dec | 110,228 | 110,228 |
| Retained earnings 1 Jan | 94,996 | 89,665 |
| Distribution of dividends | -6,194 | -5,631 |
| Retained earnings 31 Dec | 88,802 | 84,034 |
| Profi t for the period | -24,107 | 10,963 |
| Retained earnings 31 Dec | 64,695 | 94,996 |
| Unrestricted equity total | 173,645 | 203,946 |
At the end of the period on 31 December 2013, the company held a total of 111,312 treasury shares, accounting for 0.394% of the shares and 0.1% of the voting rights. The number of treasury shares did not change during the period.
| Calculation of funds appropriate for distribution as dividends: |
31 Dec 2013 |
31 Dec 2012 |
|---|---|---|
| Retained earnings | 88,802 | 84,034 |
| Profi t for the period | -24,107 | 10,963 |
| Treasury shares | -1,277 | -1,277 |
| Total | 63,417 | 93,719 |
The breakdown of the share capital is as follows:
| 2013 | 2012 | |||
|---|---|---|---|---|
| number | EUR 1,000 | number | EUR 1,000 | |
| Series A shares (1 vote/share) |
19,063,747 | 32,408 | 19,063,747 | 32,408 |
| Series KII shares (10 votes/share) |
9,203,981 | 15,647 | 9,203,981 | 15,647 |
| Total | 28,267,728 | 48,055 | 28,267,728 | 48,055 |
| 3.5. ACCRUED APPROPRIATIONS, EUR 1,000 |
31 Dec 2013 | 31 Dec 2012 |
|---|---|---|
| Depreciation difference | 78,554 | 73,031 |
| 3.6. NON-CURRENT LIABILITIES, EUR 1,000 |
31 Dec 2013 | 31 Dec 2012 |
|---|---|---|
| Bonds | 50,000 | 40,000 |
| Loans from fi nancial institutions | 128,015 | 177,106 |
| Pension fund loans | 20,907 | 26,277 |
| Total | 198,922 | 243,383 |
| Liabilities to Group companies: | ||
| Other non-current liabilities | 12,700 | 15,488 |
| Total non-current liabilities | 211,622 | 258,870 |
| Loans maturing later than in fi ve years: | ||
| Loans from fi nancial institutions | 0 | 50,000 |
| Pension fund loans | 8,000 | 10,513 |
| Other non-current liabilities | 1,550 | 4,338 |
| Total | 9,550 | 64,850 |
Atria Plc's bond issued in 2013 amounting to EUR 50 million matures in 2018 (interest rate 4.4%)
| 3.7. CURRENT LIABILITIES, EUR 1,000 | 31 Dec 2013 | 31 Dec 2012 |
|---|---|---|
| Bonds | 40,000 | 40,000 |
| Loans from fi nancial institutions | 67,273 | 47,628 |
| Pension fund loans | 5,370 | 5,370 |
| Trade payables | 4,421 | 1,004 |
| Other liabilities | 1,333 | 7,281 |
| Accruals and deferred income | 3,579 | 3,921 |
| Liabilities to Group companies: | ||
| Other non-current liabilities | 2,788 | 2,788 |
| Trade payables | 977 | 444 |
| Other liabilities | 119,295 | 95,227 |
| Accruals and deferred income | 116 | 137 |
| Total current liabilities | 245,149 | 203,800 |
| Material items included in accruals and deferred income: |
||
| - accruals of salaries and social security payments |
250 | 674 |
| - personnel fund | 0 | 6 |
| - interest accruals | 3,117 | 1,848 |
| - exchange rate difference of forward contracts |
0 | 1,492 |
| - amortised taxes | 324 | 0 |
| - other | 3 | 37 |
| Total | 3,694 | 4,058 |
Atria Plc's bond issued in 2007 amounting to EUR 40 million matures in 2014 (interest rate 1.04%)
| 4.1. SECURITIES GIVEN, CONTINGENT |
|---|
| LIABILITIES AND OTHER LIABILITIES |
| Contingent liabilities and other liabilities not | 31 Dec | 31 Dec |
|---|---|---|
| included in the balance sheet | 2013 | 2012 |
| Guarantees: | ||
| For group companies | 63,250 | 70,734 |
| On behalf of others | 220 | 0 |
| Total | 63,470 | 70,734 |
| Other leases: | ||
| Minimum rents paid based on other leases | ||
| Within one year | 530 | 527 |
| Within more than one year and a maximum of | ||
| fi ve years | 947 | 1,220 |
| After more than fi ve years | 3,411 | 3,396 |
| Total | 4,888 | 5,143 |
The company has made property investments referred to in the Value Added Tax Act. The remaining verifi cation liability of these investments was assessed for each verifi cation period on 31 December 2013.
The company is obliged to verify reductions in VAT on property investments if the taxable use of the properties decreases during the verifi cation period.
| Year of completion of the investment | Remaining amount of verifi cation liability |
|
|---|---|---|
| 2009 | 0 | 826 |
| 2010 | 215 | 251 |
| 2011 | 1,241 | 1,418 |
| 2012 | 2,246 | 2,526 |
| 2013 | 2,543 | 0 |
| Total | 6,244 | 5,020 |
| 4.3 DERIVATIVE FINANCIAL INSTRUMENTS | 31 Dec 2013 |
31 Dec 2012 |
|---|---|---|
| Fair values of derivative fi nancial instruments | Derivative assets (+) / liabilities (-) |
|
| Forward exchange agreements: Other hedges |
283 | -1,492 |
| Interest rate swaps, due in more than one year: | ||
| Cash fl ow hedges under hedge accounting | -4,097 | -6,849 |
| Total | -3,814 | -8,341 |
| Signatures to the fi nancial statements and annual report |
Note to the fi nancial statements | |
|---|---|---|
| Seinäjoki, 20 March 2014 Seppo Paavola Chairman |
Esa Kaarto | A report on the audit performed has been issued today. Seinäjoki, 20 March 2014 PricewaterhouseCoopers Oy |
| Authorised Public Accountants Juha Wahlroos |
||
| Timo Komulainen | Kjell-Göran Paxal | Authorised Public Account |
| Jyrki Rantsi | Maisa Romanainen | |
| Harri Sivula | Juha Gröhn CEO |
We have audited the accounting records, the fi nancial statements, the report of the Board of Directors and the administration of Atria Corporation for the year ended 31 December, 2013. Th e fi nancial statements comprise the consolidated statement of fi nancial position, income statement, statement of comprehensive income, statement of changes in equity and statement of cash fl ows, and notes to the consolidated fi nancial statements, as well as the parent company's balance sheet, income statement, cash fl ow statement and notes to the fi nancial statements.
Th e Board of Directors and the Managing Director are responsible for the preparation of consolidated fi nancial statements that give a true and fair view in accordance with International Financial Reporting Standards (IFRS) as adopted by the EU, as well as for the preparation of fi nancial statements and the report of the Board of Directors that give a true and fair view in accordance with the laws and regulations governing the preparation of the fi nancial statements and the report of the Board of Directors in Finland. Th e Board of Directors is responsible for the appropriate arrangement of the control of the company's accounts and fi nances, and the Managing Director shall see to it that the accounts of the company are in compliance with the law and that its fi nancial aff airs have been arranged in a reliable manner.
Our responsibility is to express an opinion on the fi nancial statements, on the consolidated fi nancial statements and on the report of the Board of Directors based on our audit. Th e Auditing Act requires that we comply with the requirements of professional ethics. We conducted our audit in accordance with good auditing practice in Finland. Good auditing practice requires that we plan and perform the audit to obtain reasonable assurance about whether the fi nancial statements and the report of the Board of Directors are free from material misstatement, and whether the members of the Supervisory Board and Board of Directors of the parent company as well the Managing Director are guilty of an act or negligence which may result in liability in damages towards the company or whether they have violated the Limited Liability Companies Act or the articles of association of the company.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the fi nancial statements and the report of the Board of Directors. Th e procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation of fi nancial statements and report of the Board of Directors that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the eff ectiveness of the company's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the fi nancial statements and the report of the Board of Directors.
We believe that the audit evidence we have obtained is suffi cient and appropriate to provide a basis for our audit opinion.
In our opinion, the consolidated fi nancial statements give a true and fair view of the fi nancial position, fi nancial performance, and cash fl ows of the group in accordance with International Financial Reporting Standards (IFRS) as adopted by the EU.
In our opinion, the fi nancial statements and the report of the Board of Directors give a true and fair view of both the consolidated and the parent company's fi nancial performance and fi nancial position in accordance with the laws and regulations governing the preparation of the fi nancial statements and the report of the Board of Directors in Finland. Th e information in the report of the Board of Directors is consistent with the information in the fi nancial statements.
We support that the fi nancial statements and the consolidated fi nancial statements should be adopted. Th e proposal by the Board of Directors regarding the use of the profi t shown in the balance sheet is in compliance with the Limited Liability Companies Act. We support that the Members of the Supervisory Board and Board of Directors as well the Managing Director of the parent company should be discharged from liability for the fi nancial period audited by us.
Seinäjoki 20 March 2014
PricewaterhouseCoopers Oy Authorised Public Accountants
Juha Wahlroos Authorised Public Accountant
| Corporate governance 100 | |
|---|---|
| Corporate governance statement 101 | |
| General Meeting 102 | |
| Nomination Board 102 | |
| Supervisory Board 102 | |
| Board of Directors 103 | |
| Board committees 104 | |
| CEO 105 | |
| Management Team 110 | |
| Remuneration110 | |
| Internal control, risk management and internal audit 110 | |
| Auditing 115 | |
| Insider policy115 | |
| Communication 115 | |
| Remuneration statement 116 |
Atria Plc ("Atria" or "the company") is a Finnish public company, and the responsibilities and obligations of its governing bodies are determined by Finnish law. Th e parent company, Atria Plc, and its subsidiaries constitute the international Atria Group. Th e company is domiciled in Kuopio.
Responsibility for the administration and operations of Atria Group lies with the governing bodies of the parent, Atria Plc. Th ese are the General Meeting, Supervisory Board, Board of Directors and CEO.
Atria's decision-making and corporate governance are in compliance with the Finnish Limited Liability Companies Act, regulations applied to publicly listed companies, Atria Plc's Articles of Association, the rules of procedure for Atria's Board of Directors and committees, and NASDAQ OMX Helsinki Ltd's rules and guidelines. Atria follows the Finnish Corporate Governance Code ("Corporate Governance Code"). Th e full Corporate Governance Code may be viewed at www.cgfi nland.fi . In accordance with the Comply or Explain principle, the company departs from the recommendations of the Code as follows:
Atria Plc has prepared a Corporate Governance Statement in accordance with recommendation 54 of the Corporate Governance Code.
Th e Articles of Association and the pre-emptive purchase clause can be found in their entirety on the company's website at www.atriagroup.com/en/investors/Corporategovernance.
Lihakunta and Itikka Co-operative, two of Atria's shareholders, have agreed to ensure that they are both represented on the Supervisory Board in proportion with their holdings of Series KII shares in the company. Th e parties will also ensure that the Chairman of the Supervisory Board and the Vice Chairman of the Board of Directors are nominated by one party and the Chairman of the Board of Directors and the Vice Chairman of the Supervisory Board by the other party.
Regarding the distribution of Board positions, it has been agreed that each of the parties may nominate three ordinary members and their deputy members to the Board of Directors. Th e agreement also includes stipulations on the mutual proportion of shareholding and on the procedures followed when either party acquires more Series KII shares directly or indirectly. According to the agreement, the acquisition of Series A shares is not considered in the evaluation of the mutual proportion of shareholding.
Furthermore, Lihakunta, Itikka Co-operative and Pohjanmaan Liha, who hold shares in Atria, have agreed to ensure that Pohjanmaan Liha has one representative on the Supervisory Board. Th e agreement also includes stipulations on Pohjanmaan Liha Co-operative's shareholding.
Th e company is not aware of any other shareholder agreements.
Th e full Corporate Governance Statement can be found on the company's website at www.atriagroup.com/en/investors/ Corporategovernance.
Th e General Meeting is Atria Plc's highest decision-making body. At the General Meeting, shareholders decide on the approval of the fi nancial statements and the use of the profi t shown on the balance sheet; discharging of the members of the Board of Directors and of the Supervisory Board, as well as the CEO, from liability; the number of members of the Supervisory Board and of the Board of Directors, and their election and remuneration; and the election of one or more auditors.
Th e Annual General Meeting is held by the end of June on a date designated by the Board of Directors, and the agenda includes the matters to be handled by the Annual General Meeting in accordance with the Articles of Association and any other proposals. Extraordinary General Meetings may be convened as needed.
Under the Limited Liability Companies Act, a shareholder has the right to have a matter falling within the competence of the General Meeting dealt with by the General Meeting, if the shareholder so demands in writing from the Board of Directors well in advance of the meeting, so that the matter can be mentioned in the notice. Where applicable, the shareholder must submit a request to have the matter dealt with by the Annual General Meeting by the date set by the company, which is published on the company's website at www.atriagroup.com. Th e request, with accompanying justifi cation or proposed resolution, must be sent in writing to Atria Plc, Group Legal Aff airs, P.O. Box 900, FI-60060 ATRIA.
Th e General Meeting is convened by the Board of Directors. It is held in the company's domicile, Kuopio, or in Helsinki. Notices to convene General Meetings are communicated by publishing them on the Company's website and by publishing a stock exchange release at the earliest three (3) months and at the latest three (3) weeks before the General Meeting. Notices will be published no later than nine (9) days prior to the record date for the General Meeting. In addition, the Board of Directors may decide to publish the notice, or a notifi cation of its delivery, in one or more national newspapers determined by the Board, or in another manner decided by the Board.
To have the right to participate in a General Meeting, shareholders must register with the Company by the day mentioned in the notice of meeting, which can be no earlier than ten (10) days before the meeting.
Th e CEO, the Chairman of the Board and the majority of the Board members shall be present at General Meetings; in addition to the aforementioned, auditors shall be present at Annual General Meetings. First-time candidates for the Supervisory Board or the Board of Directors shall be present at the General Meeting where decisions on their appointment are made, unless there is compelling justifi cation for their absence.
Atria Plc's General Meeting has appointed a Nomination Board to prepare proposals concerning the election and remuneration of Board members for the next Annual General Meeting.
Shareholders or their representatives who own Series KII shares as well as the largest holder of Series A shares who does not own Series KII shares, or a representative thereof, shall be elected to the Nomination Board in accordance with their ownership in early November preceding the next General Meeting. Th e right to nominate a representative to the Nomination Board is determined on the basis of the shareholder register maintained by Euroclear Finland Ltd in accordance with the situation on the fi rst banking day of the November preceding the Annual General Meeting. Th e Chairman of the Board of Directors shall also be appointed to the Nomination Board as an expert member.
If a shareholder does not wish to exercise his or her right to nominate a member, the right will be transferred to the next largest Series A shareholder as per the shareholder register who would not otherwise have the right to nominate a member. Some shareholders are obligated to notify the company of certain changes in shareholding when necessary under the Finnish Securities Markets Act. Such shareholders may present a written request to the company's Board of Directors by the end of October for the holdings of corporations or foundations controlled by the shareholder, or the shareholder's holdings in several funds or registers, to be combined when calculating voting rights.
Th e Nomination Board is convened by the Chairman of the Board of Directors, and the Nomination Board elects a Chairman from amongst its members. Th e Nomination Board shall present its proposal to the Board of Directors by the fi rst day of the February preceding the Annual General Meeting.
In accordance with Atria Plc's Articles of Association, the company has a Supervisory Board elected by the General Meeting. Th e Supervisory Board consists of a minimum of 18 and a maximum of 21 members, who are elected for terms of three years. A person aged sixty-fi ve (65) or older cannot be elected to the Supervisory Board. Th e Supervisory Board elects a Chairman and a Vice Chairman from amongst its members for terms of one year. Th e Supervisory Board meets three times a year on average.
Th e duties of the Supervisory Board are specifi ed in the Limited Liability Companies Act and Atria Plc's Articles of Association. Th e key duties of the Supervisory Board are as follows:
Shareholders of the company representing more than 50% of the votes have expressed their satisfaction with the current model based on the Supervisory Board, because it brings a far-reaching perspective on the company's operations and decision-making.
| Name Born |
Member from |
Education | Main occupation |
Share ownership |
|---|---|---|---|---|
| • Hannu Hyry (Chairman) 1956 | 2013 | Farmer | 144 | |
| • Juho Anttikoski (Vice Chairman) 1970 | 2009 | Farmer | 4,000 | |
| • Mika Asunmaa1970 | 2005 | Farmer | 6,000 | |
| • Lassi-Antti Haarala 1966 | 2002 | Agrologist | Farmer | 6,000 |
| • Jussi Hantula 1955 | 2012 | Agrologist | Farmer | 681 |
| • Henrik Holm 1966 | 2002 | Farmer | 430 | |
| • Veli Hyttinen 1973 | 2010 | Agrologist | Farmer | 1,500 |
| • Pasi Ingalsuo 1966 | 2004 | Agrologist | Farmer | 4,000 |
| • Jukka Kaikkonen 1963 | 2013 | Agrologist | Farmer | 0 |
| • Juha Kiviniemi 1972 | 2010 | MSc (Agr.) | Farmer | 300 |
| 184 company | ||||
| authority | ||||
| • Pasi Korhonen 1975 | 2013 | Farmer | 0 | |
| • Ari Lajunen 1975 | 2013 | MSc (Agr. & For.), Agrologist | Farmer | 0 |
| • Mika Niku 1970 | 2009 | Farmer | 200 | |
| • Pekka Ojala 1964 | 2013 | Agrologist | Farmer | 0 |
| • Heikki Panula 1955 | 2005 | MSc (Agr.) | Farmer | 500 |
| • Jari Puutio 1962 | 2012 | Farmer | 1,500 | |
| • Ahti Ritola 1964 | 2013 | BBA | Farmer | 0 |
| 400 company | ||||
| authority | ||||
| • Risto Sairanen 1960 | 2013 | Farmer | 0 | |
| • Timo Tuhkasaari 1965 | 2002 | Farmer | 600 |
All members of Atria Plc's Supervisory Board are members of the administrative bodies of the company's principal owners – Lihakunta, Itikka Co-operative and Pohjanmaan Liha Co-operative. All members of the Supervisory Board are independent of the company and dependent on signifi cant shareholders.
In 2013, Atria Plc's Supervisory Board met four (4) times, and the average attendance of the members was 98.7%.
In accordance with the Articles of Association, Atria's Board of Directors has a minimum of fi ve and a maximum of seven members. Th e term of offi ce of a member of Atria's Board of Directors diff ers from the term of one year specifi ed in recommendation 10 of the Corporate Governance Code. As per the Articles of Association, the term of a member of the Board of Directors is three (3) years. Shareholders representing more than 50% of the votes have stated that the term of three (3) years is appropriate for the long-term development of the company and have not seen the need to shorten the term from that specifi ed in the Articles of Association.
Atria's Board of Directors shall ensure the appropriate organisation of the company's administration, operations, accounting and supervision of asset management. To this end, the Board of Directors has adopted written rules of procedure concerning the duties of the Board, the matters to be dealt with, meeting practices and the decision-making procedure. According to these rules, the Board of Directors discusses and decides on signifi cant matters related to the company's strategy, investments, organisation and fi nancing. Th e rules of procedure lay down the following key duties for the Board of Directors:
Th e Board of Directors regularly assesses its operations and working methods through self-evaluation once a year.
Th e Board of Directors meets at regular intervals about 10 times during the term in accordance with a separate meeting schedule confi rmed in advance by the Board, and when necessary. In 2013, the Board of Directors met fi fteen (15) times. Th e average attendance of the members of the Board of Directors was 96.2%.
During the meetings of the Board of Directors, the CEO gives a review of the fi nancial situation of the Group by business area. Th e review also covers forecasts, investments, organisational changes and other issues that are important for the Group.
Th e company shall provide the Board of Directors with suffi cient information on the company's operations to enable the Board to properly perform its duties. Th e agenda of the meeting shall be delivered to the members of the Board of Directors at least one week before the meeting. Th e meeting material shall be prepared by the CEO and the secretary of the Board of Directors according to the instructions provided by the Chairman. Th e meeting material shall be delivered to the members at least three days before the meeting.
Atria Plc´s Board of Directors from left: Seppo Paavola (Chairman), Harri Sivula, Timo Komulainen ( Vice Chairman), Kjell-Göran Paxal, Maisa Romanainen, Jyrki Rantsi and Esa Kaarto.
Th e members of the Board of Directors are obliged to provide the Board with suffi cient information to assess their skills and independency and to notify the Board of any changes to the information.
Th e Board of Directors may set up committees to handle duties designated by the Board. Th e Board shall approve the rules of procedure for the committees. Th e committees of the Board of Directors are the Nomination Committee and the Remuneration Committee, whose members are elected by the Board from amongst its members according to the rules of procedure of the committee. Th e committees have no autonomous decision-making power. Decisions are made by the Board of Directors based on the committees' preparations. Th e committees shall report on their work to the Board of Directors, which also supervises their operations.
| Name | Paavola, Seppo Felix Chairman |
Komulainen, Timo Juhani Vice Chairman |
Kaarto, Esa Heikki Ilmari |
|---|---|---|---|
| Year of birth | 1962 | 1953 | 1959 |
| Education | Agrologist (secondary school graduate) |
Agrologist | MSc (Agr.) |
| Main occupation |
Farmer | Farmer | Farmer |
| Relevant work experience |
• Farm advisor, Rural Centre of Central Ostrobothnia 1991–1996 • Agricultural entrepreneur 1996– |
• Acquisition agent, Lihakunta 1979– 1984 • Positions of trust |
Farmer |
| Member of the Board since |
2012 | 1993 | 2009 |
| Current key positions of trust |
• Supervisory Board of Itikka Co-operative, member 2000–, Vice Chairman 2008–2011 and Chairman 2012– • Chairman of the Board of Directors of Kaustinen Co-operative Bank 2002– • Member of the Board of Directors of Pellervo Confederation of Finnish Co-operatives 2012– • Member of the Co-operative Advisory Committee 2012– |
• Board of Directors of Lihakunta, member 1988– and Chairman 1996– • Vice Chairman of the Board of Directors of A-Farmers Ltd 2000- 2003 and Chairman of the Board of Directors of A-Farmers Ltd 2003– • Chairman of the Board of Directors of A-Rehu Oy 2004– • Board of Directors of Jukola Co-operative, member 1984– and Vice Chairman 1995– |
• Board of Directors of Itikka Co-operative, member 2002– and Chairman 2009– • Board of Directors of A-Farmers Ltd, member 2004– and Vice Chairman 2009– • Vice Chairman of the Board of Directors of A-Rehu Oy 2009– • Member of the Board of Directors of Oy Feedmix Ab 2009– • Member of the Board of Directors of Kiinteistö Oy Rehukanava 2009– • Chairman of the Board of Directors of Suurusrehu Oy 2009– |
| Expired key positions of trust |
Member of the Supervisory Board of Atria Plc 2006–2009 and Vice Chairman 2009–2012 |
||
| Independency | Independent of the company and dependent on signifi cant shareholders |
Independent of the company and dependent on signifi cant shareholders |
Independent of the company and dependent on signifi cant shareholders |
| Share ownership in the company |
3 300 | 200 | 1 100 |
| Share-based rights in the company |
no | no | no |
| Name | Paxal, Kjell-Göran | Rantsi Jyrki | Romanainen, Maisa Annukka |
|---|---|---|---|
| Year of birth | 1967 | 1968 | 1967 |
| Education | Agrologist | Agrologist | MSc (Econ.) |
| Main occupation |
• Farmer • Piglet and pork producer |
Farmer | Executive Vice President, Director, Department Store Division, Stockmann Group 2008– |
| Relevant work experience |
• Feed salesman, Foremix Oy 1990– 1997 • Primary Production Manager, Pohjanmaan Liha Co-operative 1990–1997 |
Agricultural entrepreneur | • Brio Oy, Product Manager and Purchasing Manager, among other duties, 1990–1996 • Stockmann Oyj Abp - Purchasing Manager 1996–1997 - Department Store Director, Moscow, Russia 1998–2000 - Department Store Director, Tallinn, Estonia 2000–2005 - Director, international department stores 2005–2007 - Director, Finnish and Baltic department stores 1 Jan – 5 Nov 2008 |
| Member of the Board since |
2012 | 2013 | 2010 |
| Current key positions of trust |
• Board of Directors of Pohjanmaan Liha, deputy member 1999–2001, Vice Chairman 2002–2009 and Chairman 2010– • Board of Directors of A-Farmers Ltd, deputy member 2001–2002 and member 2003– • Board of Directors of Oy Foremix Ab, member 2004–2009 and Chairman 2010– • Member of the Board of Directors of A-Rehu Oy 2010– • Chairman of the Board of Directors of Ab WestFarm Oy 2010– |
• Vice Chairman of the Board of Directors of Lihakunta 2013– • Member of the Board of Directors of Rautavaara Data Network Co-operative 2011– • Member of the Supervisory Board of North-east Savo Co-operative Bank 2008– |
• Deputy member of the Board of Directors of the East Offi ce of Finnish Industries 2008– • Member of the Board of Directors of TUKO (Tuko Logistics Co-operative) 2009– • Member of the Board of Directors of PTY (Finnish Grocery Trade Association) 2008– • Member of the Board of Directors of the Finnish-Russian Chamber of Commerce 2012– |
| Expired key positions of trust |
• Deputy member of the Board of Directors of the Central Union of Swedish-Speaking Agricultural Producers in Finland 1999–2001 |
||
| Independency | Independent of the company and dependent on signifi cant shareholders |
Independent of the company and dependent on signifi cant shareholders |
Independent of the company and signifi cant shareholders |
| Share ownership in the company |
666 | 700 | 0 |
| Share-based rights in the company |
no | no | no |
| Name | Sivula, Harri Juhani | ||
|---|---|---|---|
| Year of birth | 1962 | ||
| Education | MSc (Admin.) | ||
| Main occupation |
CEO, Restel Group 2011– | ||
| Relevant work experience |
• Kesko Oyj 1987–1999 - Sales Manager, Purchasing Manager - Division Manager, Sales Director - Director of Marketkesko - Director of Lähikesko - Director of the Food Division • Kesko Oyj/Kesko Food, 1999–2006 - Executive Vice President • Onninen Oy, 2006–2010 - CEO |
||
| Member of the Board since |
2009 | ||
| Current key positions of trust |
• Chairman of the Board of Directors of Tokmanni Oy 2011– |
||
| Expired key positions of trust |
• Member of the Board of Directors of Olvi Plc 2007–2011 • Member of the Board of Directors of Norpe Oy 2010–2013 • Member of the Board of Directors of Leipurin Oy 2010–2013 • Member of the Supervisory Board of Luottokunta Oy 2011–2013 |
||
| Independency | Independent of the company and signifi cant shareholders |
||
| Share ownership in the company |
10 000 | ||
| Share-based rights in the company |
no |
Th e Nomination Committee consists of the Chairman of the Board of Directors and two members of the Board of Directors elected by the Board itself. In accordance with recommendation 29 of the Corporate Governance Code, the company's CEO or the members of the Board of Directors who belong to the company's other management shall not be elected as members of the Nomination Committee.
According to the rules of procedure, the duties of the Nomination Committee are as follows:
Th e Chairman shall convene the Nomination Committee as needed. At the meetings, the matters belonging to the duties of the Nomination Committee are discussed. Th e Nomination Committee may invite other people to join its meetings if deemed necessary and may use external experts to assist the Committee in fulfi lling its duties.
Th e Chairman of the Nomination Committee is Seppo Paavola and the other members are Maisa Romanainen and Timo Komulainen. All members of the Nomination Committee are independent of the company. Maisa Romanainen is also independent of signifi cant shareholders. Th e Committee did not meet in 2013.
As noted in section 4 above, Atria Plc's General Meeting has established a separate Nomination Board to prepare proposals concerning the election and remuneration of Board members for the next Annual General Meeting.
Th e Remuneration Committee consists of the Chairman, Vice Chairman and one member of the Board of Directors elected by the Board itself. In accordance with recommendation 32 of the Corporate Governance Code, the CEO shall not be elected to the Remuneration Committee, nor shall any other member of the company's management personnel.
Th e aim of the Remuneration Committee is to ensure the objectivity of decision-making, enable the company to achieve its goals through bonus schemes, increase the company's value and ensure that bonus schemes are transparent and systematic. A further aim of the Remuneration Committee is to ensure that the merit pay systems are connected with the company's strategy and results.
According to the rules of procedure, the duties of the Remuneration Committee are as follows:
Th e Chairman of the Remuneration Committee shall convene the Committee at least twice a year and otherwise whenever necessary. At the meetings, the matters belonging to the duties of the Remuneration Committee are discussed. Th e Remuneration Committee may invite other people to join its meetings if deemed necessary and may use external experts to assist the Committee in fulfi lling its duties.
Th e Chairman of the Remuneration Committee is Seppo Paavola and the other members are Timo Komulainen and Harri Sivula. All members of the Remuneration Committee are independent of the company. Harri Sivula is also independent of signifi cant shareholders. Th e Remuneration Committee met fi ve (5) times in 2013. All members of the Committee attended all meetings.
Th e company has a CEO in charge of managing the company's operations in accordance with the instructions and orders issued by the Board of Directors, as well as informing the Board of Directors of the development of the company's operations and fi nancial performance. Th e CEO also sees to the organisation of the company's day-to-day administration and ensures reliable asset management. Th e CEO is appointed by the Board of Directors, which decides on the terms of his or her employment.
Since March 2011, Atria Plc's CEO has been Juha Gröhn, MSc (Food Sc.).
Atria Group has a Management Team chaired by the CEO. Th e Management Team assists the CEO in business planning and operational management. Th e duties of the Management Team include preparing strategic plans and putting them into practice, handling signifi cant projects and organisational changes, and reviewing and implementing the Group's risk management measures in their respective areas of responsibility.
In 2013, the Management Team met twelve (12) times.
Atria Plc has prepared a Remuneration Statement in accordance with recommendation 47 of the Corporate Governance Code. Th e statement is available on the company's website at www.atriagroup.com/en/investors/Corporategovernance.
Internal control and risk management are processes under the responsibility of the company's top management. Th ey aim to ensure that the company can achieve its goals. Th e operating principles of internal control are confi rmed by the company's Board of Directors. Atria's internal control includes comprehensive risk management and internal audit. Th e purpose of internal control is to ensure that Atria's operations are effi cient and in line with the company's strategy, all fi nancial and operational reports are reliable, the Group's operations are legal and the company's internal principles and codes of conduct are complied with.
Th e purpose of risk management is to support the execution of Atria's strategy and the achievement of targets, and to secure business continuity. Atria Group's risk management goals, principles, responsibilities and powers are specifi ed in its Risk Management Policy, which has been approved by the Board of Directors. Th e aim of the policy is to contribute to the identifi cation and understanding of risks and to ensure that management receive relevant and suffi cient information in support of business decisions.
Risk management is used to identify, assess and manage factors that jeopardise the attainment of goals. In compliance with the policy, the Group has in place a uniform operating model for risk identifi cation and reporting in all business areas. Th e model forms an integral part of annual strategic planning. Risks are managed in accordance with the specifi ed approved principles in all business areas and Group operations. During risk assessment, an action plan is defi ned. Th is is then used as a basis for managing the risks that have been identifi ed.
| Name | Juha Gröhn CEO, Atria Plc |
Juha Ruohola Group Vice President and Deputy CEO |
Mika Ala-Fossi Executive Vice President Atria Finland |
|---|---|---|---|
| Joined Atria in |
1990 | 1999 | 2000 |
| Year of birth | 1963 | 1965 | 1971 |
| Education | MSc (Food Sc.) | MSc (Agriculture and Forestry), eMBA |
Meat industry technician |
| Relevant work experience |
• Foreman, Lihapolar 1990–1991 • R&D Manager, Itikka-Lihapolar 1991–1993 • Director, Slaughterhouse Industry, Atria Ltd 1993–1998 • Director, Meat Product and Convenience Food Industries, Atria Ltd 1999–2003 • Director, Steering, Deputy CEO, Atria Ltd 2003–2004 • Director, Meat Industry, Deputy CEO, Atria Ltd 2004–2006 • Executive Vice President, Atria Finland Ltd, Deputy CEO, Atria Plc 2006–2010 • Executive Vice President, Atria Scandinavia, Deputy CEO, Atria Plc 2010–2011 • CEO, Atria Plc 2011– |
• Agronomist, Central Union of Agricultural Producers and Forest Owners (MTK), Tampere Region 1990–1992 • Acting Executive Director, Central Union of Agricultural Producers and Forest Owners (MTK), Tampere Region 1992–1994 • Purchasing Director LSO Foods Oy 1994–1997 • Managing Director, Lihakunta Co-operative 1997–1999 • Managing Director, Lithells AB 1999–2001 • Director, Convenience Food Industry, Atria Ltd 2001–2003 • Director, Meat Product and Convenience Food Industries, Atria Ltd 2003–2005 • Director, Meat Product Industry, Atria Ltd 2005–2006 • Director, Atria Russia 2006–2011 • Deputy CEO, Atria Plc 2011– |
• Foreman, Liha-Saarioinen Oy 1997– 2000 • Unit Manager, Atria Ltd 2000–2003 • Production Manager, Atria Ltd 2003–2006 • Director, poultry operations, Atria Finland 2006–2007 • Director, Convenience Food and Meat Product Production 2007–2011 • Executive Vice President, Atria Finland, 2011– |
| Share ownership in the company |
17,493 | 2,580 | 940 |
| Name Joined Atria in |
Tomas Back Executive Vice President Atria Scandinavia 2007 |
Jarmo Lindholm Executive Vice President Atria Russia 2002 |
Olle Horm Executive Vice President Atria Baltic 2012 |
|---|---|---|---|
| Year of birth | 1964 | 1973 | 1967 |
| Education | MSc (Econ.) | MSc (Econ.) | Engineer |
| Relevant work experience |
• Financial Manager, Huhtamäki Finance Oy, Lausanne 1990–1995 • Financial Manager/CFO, Huhtamäki Oyj 1996–2002 • CFO, Huhtamäki Americas /Rigid Europe 2003–2007 • CFO, Atria Plc 2007–2011 • Director, Atria Baltic 2010–2011 • Executive Vice President, Atria Scandinavia 2011– |
• Customer Service Manager & e-Business, Unilever Finland 1998–2000 • Account Manager, Marketing Manager, AC Nielsen 2000–2002 • Marketing Manager, Atria Ltd 2002–2005 • Group Vice President, Product Group Management and Product Development, Atria Plc Commercial Director, Atria Finland Ltd 2005–2010 • Group Vice President, Product Leadership, Atria Plc 2010–2011 • Executive Vice President, Atria Russia 2011– |
• Managing and developing tasks, EK AS 1992–1998 • Head of transportation and equipment department, EMV AS 1998–1999 • Chairman of the Board, Rakvere Lihakombinaat AS 2000-2008 • Chairman of the Board, Skanska EMV AS 2008–2009 • Chairman of the Board, Maag Meat Industry 2009–2012 • Executive Vice President, Atria Baltic 2012– |
| Share ownership in the company |
1,880 | 1,020 | 0 |
| Name | Heikki Kyntäjä CFO |
|---|---|
| Joined Atria in |
2009 |
| Year of birth | 1952 |
| Education | BSc (Econ.) |
| Relevant work experience |
• Auditor, fi nance department, General Motors Finland 1976–1978 • Financial Offi cer, Hackman Taloustavarat Oy 1978–1986 • Business Controller, Stromberg Inc., Cleveland, OH, USA 1986–1988 • Business Controller, ABB Motors Oy 1988–1990 • VP Finance & Control, ABB Strömberg Sähkönjakelu Oy 1991– 1995 • VP Finance & Control, ABB Transmit Oy 1995–2000 • VP Finance & Control, ABB Oy, Low-voltage instruments 2001– 2008 • VP Supply Management, ABB Oy, Low-voltage instruments 2008– 2009 • Finance Director, Atria Finland Ltd 2009–2011 • CFO, Atria Plc 2011– |
| Share ownership in the company |
1,000 |
Risks are defi ned as external or internal (within Atria Group) events that may have a positive or negative impact on the execution of the company's strategy, the achievement of its targets and the continuity of business.
Atria is subject to many diff erent risks. For reporting purposes, Atria's risks are divided into four categories: business risks, fi nancial risks, operational risks and accident risks.
Business risks may be related to business decisions, resources allocation, the way in which changes in the business environment are responded to, or management systems in general.
Financial risks may refer to the risk of insuffi cient fi nancial resources in the short or medium term, the risk of counterparties failing to meet their fi nancial obligations or the risk of changes in market prices aff ecting the company.
Operational risks are defi ned as defi ciencies or disruptions in processes or systems, risks related to people's actions and risks related to legislation or other regulations.
Accident risks refer to external or internal (within Atria) events or disruptions that cause damage or loss.
Atria Plc's Board of Directors approves the Risk Management Policy and supervises its implementation. Th e CEO is responsible for organising risk management.
Internal control and risk management are implemented by the entire organisation, including the Board of Directors, management and the entire personnel. However, the responsibility for internal control and risk management lies with the company's top management. Organising internal control and risk management is part of Group management. Th e company's management defi nes the operational procedures and codes of practice that enable the company to achieve its goals.
Th e Group's Management Team and the management teams of the business areas are responsible for identifying and assessing risks and for implementing risk management in their respective areas of responsibility. Financial risk management is centralised in the Group's Treasury unit. Th e Group's CFO gathers the most signifi cant risks that are identifi ed and reports them to the Board of Directors at least once a year. Th e CFO is responsible for development, guidelines and support in risk management and reporting. External advisers are also used in the development work.
Risk management is discussed in more detail in the annual report under "Risk management at Atria".
Atria's fi nancial administration handles internal audits in collaboration with an external service provider. Internal audits are conducted in compliance with policies approved by the Board of Directors, which are based on internal reporting and an annual audit plan confi rmed by the Board of Directors. A key task of internal audit is to review and assess the suitability, functionality and profi tability of the company's risk management and internal control. Th erefore, its aim is to contribute to the achievement of the organisation's goals. Within its duties, the function assesses the following areas:
Th e purpose of internal audit is to ensure that all of the company's business areas comply with the Group's rules and guidelines and that the operations are eff ectively managed. Th e results of internal auditing are documented. Th ey are discussed with the management of the audited entity before the report and suggestions for improvement are presented to the Group's CEO.
Th e achievement of fi nancial targets is regularly monitored by means of Group-wide fi nancial reporting. Th e reports include actual fi gures, budgets and up-to-date forecasts for the current year.
Th e entities to be audited are defi ned in cooperation with Group management. Th e audit plan is also based on annual Group-wide risk assessment. Th e company's Board of Directors approves the annual plan for internal audit. Where necessary, internal audit also conducts separate studies commissioned by the Board of Directors or the Group's management. A summary of the audit results is presented to the Board of Directors at least once a year.
In accordance with the Articles of Association, the company shall have at least one (1) and no more than four (4) regular auditors and at most as many deputy auditors. Th e auditors and deputy auditors shall be public accountants or fi rms of independent public accountants authorised by the Central Chamber of Commerce of Finland. Th e term of service of the auditors shall end at the conclusion of the Annual General Meeting following their election.
Th e auditor provides Atria's shareholders with an Auditor's Report in accordance with the law, in conjunction with the company's fi nancial statements, and regularly reports to the Board of Directors and management. Th e auditor participates in a Board meeting at least once a year, during which the audit plan and auditing results are discussed.
In 2013, Atria Plc's Annual General Meeting elected PricewaterhouseCoopers Oy, a fi rm of authorised public accountants, as the company's auditor until the closing of the next AGM. According to the fi rm, the auditor in charge is Authorised Public Accountant Juha Wahlroos. Th e auditor will be paid according to invoice.
In 2013, the Group paid a total of EUR 473,000 in auditor's remuneration. In addition, EUR 54,000 was paid for services not related to auditing.
Atria complies with NASDAQ OMX Helsinki Ltd's Guidelines for Insiders that entered into force 1 July 2013. Atria's Board of Directors has confi rmed the insider guidelines for the company, which include instructions for permanent and project-specifi c insiders. Th e company's guidelines have been distributed to all insiders.
Th e insider registers are maintained in cooperation with Euroclear Finland Oy. Th e company's legal department and CFO monitor compliance with the insider guidelines. Th e company has limited its insiders' right to trade in the company's shares in the 14 days preceding the publication of the company's interim reports and fi nancial statements. In addition to the public insider register, there is a separate register of other permanent insiders, maintained by the legal department, and there are also project-specifi c registers wherein insider information is recorded by project.
Th e aim of Atria's investor reporting is to ensure that the market has correct and suffi cient information available at all times to determine the value of Atria's shares. An additional aim is to provide the fi nancial markets with comprehensive information to enable active participants in the capital markets to form a justifi ed image of Atria as an investment.
Atria has established a silent period for its investor relations communications of three weeks prior to the publication of interim reports and annual reports. During this period, Atria does not give any statements on its fi nancial status.
Atria publishes fi nancial information in real time on its website at www.atriagroup.com. Th e site contains annual reports, interim reports and press and stock exchange releases. Th e company's largest shareholders and insiders are regularly updated on the website, along with details on their holdings.
Th e disclosure policy approved by Atria's Board of Directors describes the key principles and procedures followed by Atria as a listed company in its communications with the media, capital markets and other stakeholders. Atria's disclosure policy is available in its entirety on the company's website at www.atriagroup.com/en/investors/disclosurepolicy.
Th is remuneration statement of Atria Plc ("Atria" or the "company") is the statement referred to in recommendation 47 of the Corporate Governance Code.
Th e Annual General Meeting decides on the remuneration of the members of the Supervisory Board. Th e remuneration paid to the Supervisory Board in 2013 was as follows:
Th e members of the Supervisory Board have no share incentive plans or share-based bonus schemes.
In 2013, the monthly and meeting fees paid to the members of the Supervisory Board for participating in the work of the Supervisory Board (including fees for work performed in other companies within the same Group) were as follows:
| Work of the | Benefi ts from Group | ||
|---|---|---|---|
| Name | Supervisory Board | companies | Total (EUR) |
| Hyry Hannu, Chairman (from 26 April 2013) | 26,250 | 26,250 | |
| Pirkola Ari, Chairman (until 26 April 2013) | 13,750 | 13,750 | |
| Anttikoski Juho, Vice Chairman | 23,250 | 23,250 | |
| Asunmaa Mika | 2,000 | 600 | 2,600 |
| Haarala Lassi Antti | 1,750 | 1,750 | |
| Hantula Jussi | 2,000 | 2,000 | |
| Herrala Juhani (until 26 April 2013) | 500 | 500 | |
| Holm Henrik | 2,750 | 4,500 | 7,250 |
| Hyttinen Veli | 2,000 | 1,800 | 3,800 |
| Ingalsuo Pasi | 2,000 | 5,400 | 7,400 |
| Kaikkonen Jukka (from 26 April 2013) | 1,500 | 1,500 | |
| Kiviniemi Juha | 2,000 | 2,000 | |
| Korhonen Pasi (from 26 April 2013) | 1,500 | 1,500 | |
| Lajunen Ari (from 26 April 2013) | 1,000 | 1,000 | |
| Mutanen Teuvo (until 26 April 2013) | 750 | 750 | |
| Niku Mika | 2,000 | 2,000 | |
| Ojala Pekka (from 26 April 2013) | 1,750 | 1,750 | |
| Panula Heikki | 2,000 | 2,000 | |
| Parikka Pekka (until 26 April 2013) | 750 | 750 | |
| Partanen Juha (until 26 April 2013) | 500 | 500 | |
| Puutio Jari | 2,000 | 2,000 | |
| Ritola Ahti (from 26 April 2013) | 1,500 | 1,500 | |
| Sairanen Risto (from 26 April 2013) | 1,500 | 1,500 | |
| Tervonen Juho (until 26 April 2013) | 750 | 2,100 | 2,850 |
| Toivanen Tomi (until 26 April 2013) | 500 | 500 | |
| Tuhkasaari Timo | 2,000 | 2,000 | |
| TOTAL | 98,250 | 14,400 | 112,650 |
Th e Annual General Meeting decides on the remuneration of the members of Atria's Board of Directors. Th e remuneration is paid in cash. Th e members have no share incentive plans or share-based bonus schemes. Th e principles governing the CEO's remuneration are set out in a diff erent section.
Th e remuneration paid to the Board of Directors in 2013 was as follows:
In 2013, the monthly and meeting fees paid to the members of the Board of Directors for participating in the work of the Board of Directors (including being a member of the Board of another company within the same Group) were as follows:
| Board of | ||||
|---|---|---|---|---|
| Directors and | Benefi ts from | |||
| Name | Position | committee work | Group companies | Total |
| Seppo Paavola | Chairman | 75,300 | 75,300 | |
| Timo Komulainen | Vice Chairman | 41,000 | 34,800 | 75,800 |
| Tuomo Heikkilä | Member (until 26 April 2013) | 12,800 | 12,800 | |
| Esa Kaarto | Member | 33,300 | 19,800 | 53,100 |
| Kjell-Göran Paxal | Member | 32,400 | 7,800 | 40,200 |
| Jyrki Rantsi | Member (from 26 April 2013) | 20,500 | 20,500 | |
| Maisa Romanainen | Member | 23,100 | 23,100 | |
| Harri Sivula | Member | 26,700 | 26,700 | |
| TOTAL | 265,100 | 62,400 | 327,500 |
Th e bonus scheme for Atria Plc's management consists of a fi xed monthly salary, merit pay and pension benefi ts. Th e company has no share incentive plan or option scheme in place.
Atria Plc's Board of Directors decides on the remuneration, other fi nancial benefi ts and criteria applied in the merit pay system for the Group's CEO and Management Team, as well as the merit pay principles used for other management members.
Th e directors of each business area and the Group's CEO decide on the remuneration of the members of the management teams of the various business areas according to the one-over-one principle. Th e merit pay systems for the management teams of business areas are approved by the Group's CEO.
Th e retirement age for the CEO is 63 years. However, the CEO has the right to retire at the age of 60. Th e pension arrangement is payment-based and the amount of pension is based on the CEO's annual earnings at Atria Group as specifi ed by the Board of Directors. Th e earnings include monetary salary and fringe benefi ts without cash payments of incentive schemes.
According to the CEO's contract, the period of notice is six (6) months for both parties. If the company terminates the contract, the CEO is entitled to the salary for the period of notice and severance pay, which together correspond to 18 months' salary. Th ere are no terms and conditions for any other compensation based on termination of employment.
In February 2012, Atria Plc's Board of Directors decided to adopt a new long-term merit pay system for the Group's key personnel. Th e new plan has three 12-month periods: 2012, 2013 and 2014. Th e earning period for the plan ends on 31 December 2014. Th e compensation earned in each earning period is determined after the period is over based on progress against set targets. Th e plan off ers the opportunity to earn cash rewards for reaching targets established for the relevant earning period. Any profi t from the plan is based on the Group's earnings per share (EPS). Cash rewards payable under the plan throughout the course of its earning period, between 2012 and 2014, are capped at EUR 4.5 million. Th e plan covers approximately 40 of Atria Group's key personnel.
Atria Plc's Board of Directors has determined the merit pay system for the management and key personnel for 2013. Th e maximum bonus payable to Atria Plc's CEO and Management Team is 35% to 50% of annual salary, depending on the performance impact and requirement level of each individual's role. Th e criteria in Atria Plc's merit pay scheme are the performance requirements and working capital at Group level and in the area of responsibility of the person concerned. In addition to the CEO, Deputy CEO and Management Team, Atria Plc's merit pay scheme covers approximately 40 Group executives.
Managerial group pension benefi ts confi rmed by Atria's Board of Directors have been arranged for the members of Atria Group's Management Team who are covered by Finnish social security. Th e retirement age of the group pension insurance is 63 years for the members of the Management Team. However, the Management Team has the right to retire at the age of 60. Th e pension plan is payment-based, and the pension is based on the insured's annual earnings (monetary salary and fringe benefi ts) as specifi ed by the Board of Directors.
| Supplementary | |||||
|---|---|---|---|---|---|
| pension | |||||
| Salaries | Merit pay | Fringe benefi ts | contributions | Total (EUR) | |
| CEO Juha Gröhn | 458,332 | 36,222 | 19,511 | 141,227 | 655,292 |
| Deputy CEO Juha Ruohola | 236,560 | 13,706 | 14,723 | 72,799 | 337,788 |
| Other members of the Management Team |
1,094,086 | 59,617 | 60,847 | 122,695 | 1,337,245 |
| TOTAL | 1,788,978 | 109,545 | 95,081 | 336,721 | 2,330,325 |
Th e fi nancial benefi ts paid to the CEO and the Management Team in 2013 were as follows:
Atria Plc has not any share incentive plan or stock option scheme.
Th e aim of Atria's investor reporting is to ensure that the market has at all times correct and suffi cient information available to determine the value of Atria's share. In addition the aim is to provide the fi nancial markets with versatile information, based on which those active in the capital markets can form a justifi ed image of Atria as an investment object.
Atria has determined a silent period in its investor relation communication that is three weeks prior to the publication of interim and annual reports. During this period Atria gives no statements on its fi nancial status.
Atria publishes fi nancial information in real time on its web pages at www.atriagroup.com. Here you can fi nd annual reports, interim reports and press and company announcements. Th e company's largest shareholders and insiders as well as their holdings are updated regularly to the web pages.
Atria Plc published a total of 20 company announcements in 2013. Th e releases can be found on the Atria Group website www.atriagroup.com.
Th e disclosure policy approved by the Atria Board of Directors describes the key principles followed by Atria as a listed company in its communications with the capital markets and other stakeholders. Th e disclosure policy is available in full on the company's website.
Communication and IR manager Tel: + 358 400 638 839 e-mail: [email protected]
CARNEGIE INVESTMENT BANK AB Iiris Th eman Tel.+358 09 6187 1241 e-mail: fi [email protected]
EVLI PANKKI OYJ Joonas Häyhä Tel. +358 9 4766 9662 e-mail: fi rstname.lastname @evli.com
POHJOLA PANKKI OYJ Niclas Catani Tel. +358 10 252 8780 e-mail: fi rstname.lastname @pohjola.fi
NORDEA MARKETS Rauli Juva Tel. +358 9 165 59944 e-mail: fi [email protected] HANDELSBANKEN CAPITAL MARKETS Robin Santavirta Tel. +358 10 444 2483 e-mail: [email protected]
DANSKE MARKETS EQUITIES Kalle Karppinen Tel. +358 10 236 4794 e-mail: fi [email protected]
INDERES OY Sauli Vilen Tel. +358 44 0258 908 e-mail: fi [email protected]
Head Offi ce:
Itikanmäenkatu 3, Seinäjoki Finland Box 900, FI-60060 ATRIA Tel. +358 20 472 8111
Atriantie 1, Seinäjoki, Finland Box 900, FI-60060 ATRIA Tel. +358 20 472 8111
Box 1000 FI-60061 ATRIA fi [email protected] [email protected] www.atria.fi
Itikanmäenkatu 3, Seinäjoki Finland Box 900, FI-60060 ATRIA Fax +358 6 416 8207
Itikanmäenkatu 3, Seinäjoki, Finland Box 900, FI-60060 ATRIA Fax +358 6 416 8202
Commercial functions: Läkkisepäntie 23 FI-00620 Helsinki, Finland Fax +358 9 774 1035
Other offi ces and plants: Rahikkatie 95 FI-61850 Kauhajoki, Finland Fax +358 6 416 8416
Ankkuritie 2, Kuopio, Finland Box 147, FI-70101 Kuopio
Pusurinkatu 48 FI-30100 Forssa, Finland Tel. +358 3 41 541 Fax +358 3 415 4244
A-Liha Jyväskylä Oy Suluntie 1 (Box 1) FI-40351 Jyväskylä
Sahalahden Broiler Oy Isoniementie 79 FI-36420 Sahalahti
Augustendalsvägen 19 SE-131 52 Nacka Strand Box 1229 SE-131 28 Nacka Strand Sweden Tel. +46 10 482 39 10 Fax +46 8 55 63 06 60
Offi ces: Augustendalsvägen 19 SE-1331 52 Nacka Strand Box 1229 SE-131 28 Nacka Strand Sweden Tel. +46 10 482 3910 Fax +46 8 55 63 06 60 Offi ce: Retail, Concept
Södra Långebergsgatan 12 SE-421 32 Västra Frölunda, Sweden Tel. +46 10 482 36 00 Fax +46 10 482 30 05 Offi ce: Deli
Drottninggatan 14 SE-252 21 Helsingborg, Sweden Tel. +46 10 482 35 10 Fax +46 10 482 39 50 Offi ce: Foodservice
Sockenvägen 40 SE-697 80 Sköllersta, Sweden Tel. +46 10 482 30 00 Fax +46 19 23 08 28
Skogholmsgatan 12 SE-213 76 Malmö Box 446 SE-201 24 Malmö, Sweden Tel. +46 10 482 35 00 Fax +46 40 22 42 73
Göteborgsvägen 19 SE-521 30 Falköping, Sweden Tel. +46 10 482 32 00 Fax +46 10 482 32 80
Hjälmarydsvägen 2 SE-573 38 Tranås Box 1018 SE-573 28 Tranås, Sweden Tel. +46 10 482 37 00 Fax +46 10 482 37 99
Maskingatan 1 SE-511 62 Skene, Sweden Tel. +46 10 482 38 00 Fax +46 10 482 38 30
Johannelundsgatan 44 SE-506 40 Borås Box 940 SE-501 10 Borås, Sweden Tel. +46 10 482 38 10 Fax +46 10 482 38 52
Östanåkravägen 2 SE-342 62 Moheda, Sweden Tel. +46 10 482 37 10 Fax +46 10 482 37 27
Fordonsgatan 3 692 71 Kumla Tel. +46 19 57 18 78
Per Kroghs vei 4C 1065 Oslo, Norge Tel: + 47 22 42 24 43 Fax: + 47 22 32 66 24 Fax: + 47 22 16 60 21
Atria Concept Spółka z o.o. Ul.Krowoderskich Zuchów 14 31-272 Kraków Poland Tel: (+48) 12 661 20 33
3-Stjernet A/S Plant Aage Jensen Bakken 1 DK-8700 Horsens, Denmark Tel. +45 76 28 25 00 Fax +45 76 28 25 01
OOO Pit-Product Obukhovskoy Oborony pr. 70 RUS-192029 Saint-Petersburg, Russia Tel. +7 812 33 66 888 +7 812 412 88 22 Fax + 7 812 346 6176 offi [email protected] www.pitproduct.ru
OOO MPZ CampoMos Ryabinovaya street 32 RUS-121471 Moscow, Russia Tel. +7 495 448 67 04 +7 495 448 12 55 Fax +7 495 448 4503 [email protected] www.campomos.ru
Atria Eesti AS Metsa str. 19 EE-68206 Valga, Estonia Tel. +372 767 9900 Fax +372 767 9901 [email protected] fi [email protected] www.atria.ee
Atria Eesti As Järvevana tee 9 EE-11314, Tallinn, Estonia Fax +372 650 5471
Vastse-Kuuste tehas Põlva maakond EE-63601 Estonia Tel. +372 797 0216 Fax +372 797 0215
Concept and production: Selander & Co. Communications Agency Illustration: Kati Närhi Portraits: Ilkka Ärrälä
Building tools?
Free accounts include 100 API calls/year for testing.
Have a question? We'll get back to you promptly.