Quarterly Report • Oct 27, 2011
Quarterly Report
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Net sales increased by 0.9% compared with the previous year
The operating profit for the period amounted to EUR 3.8 million (EUR 5.3 million)
The EBIT for Q3 came to EUR 9.0 million (EUR -0.4 million), which shows a clear improvement on the previous two quarters
The Group's equity ratio is at the target level: 39.8% (40.1%)
Tight cost control in all business areas strengthened the Group's performance
The international meat market stabilised, resulting in an increase in sales prices for pork, which had a positive effect on the performance of Atria Finland
Atria Russia's loss for Q3 decreased compared to Q1 and Q2
| Q3 | Q3 | Q1-Q3 | Q1-Q3 | ||
|---|---|---|---|---|---|
| EUR million | 2011 | 2010 | 2011 | 2010 | 2010 |
| Net sales | 325.5 | 331.3 | 963.1 | 954.2 | 1,300.9 |
| EBIT | 9.0 | -0.4 | 3.8 | 5.3 | 9.8 |
| EBIT% | 2.8 | -0.1 | 0.4 | 0.6 | 0.8 |
| Profit before taxes | 5.4 | -3.0 | -5.5 | -1.3 | 0.3 |
| Earnings per share, EUR | 0.13 | -0.22 | -0.21 | -0.19 | -0.18 |
Atria Group's net sales for the first three quarters were EUR 963.1 million (EUR 954.2 million) with a growth of 0.9%. Calculated in fixed currencies, net sales were at the same level as last year. Atria Finland's net sales increased by 5.9%. During the comparative period, there were some breaks in production in Finland due to industrial action. The decline of 5.6% in Atria Scandinavia's net sales is mainly due to the discontinuation of consumer packed meat production in the summer of 2010, as well as slightly decreased sales volumes. Atria Russia's net sales decreased by 5.4%. This was due to a decrease in sales in Moscow. In St Petersburg, sales volumes have remained stable. Atria Baltic's net sales were at the same level as last year.
Atria Group's EBIT for the first three quarters was EUR 3.8 million (EUR 5.3 million). The EBIT for Q3 came to EUR 9.0 million (EUR -0.4 million), which shows a clear improvement on the previous two quarters (Q1/2011 = EUR -4.2 million and Q2/2011= EUR -0.9 million).
Atria Finland's EBIT for the first three quarters of EUR 12.2 million (EUR 22,9 million) weakened significantly on the previous year. The EBIT for Q3 of EUR 9.0 million (EUR 11.9 million) shows a clear improvement on the previous two quarters (Q1/2011 = EUR 0.6 million and Q2/2011= EUR 2.6 million). The international meat market stabilised and the price of meat increased at the end of Q3. In particular, the demand for and supply of pork on global markets has balanced out compared with the early part of the year. It was possible to transfer some of the accrued cost rises to sales prices at the end of the review period.
Atria Russia's EBIT for the first three quarters showed a loss of EUR -14.5 million. However, this was an improvement on the previous year (EUR -20.3 million). The earnings for the comparative period include a total of EUR 9.1 million of non-recurring costs. The EBIT of EUR -3.3 million for Q3 was better than the previous two quarters (Q1/2011 = EUR -5.6 million and Q2/2011= EUR -5.6 million).
Atria Scandinavia's EBIT for the first three quarters was EUR 9.7 million (EUR 8.3 million). The figure for the comparison year included a non-recurring cost item of EUR 2.3 million. The EBIT of EUR 4.7 million for Q3 was better than the previous two quarters (Q1/2011 = EUR 2.3 million and Q2/2011= EUR 2.7 million).
Operating cash flow stood at EUR 28.6 million (EUR 4.5 million) and cash flow from investments at EUR -29.2 million (EUR -34.8 million). The Group's free cash flow amounted to EUR -0.6 million (EUR -30.3 million). Net interest-bearing liabilities amounted to EUR 414.7 million, an increase of EUR 3.3 million since the year-end. Atria Scandinavia concluded an agreement with Nordea Finans Sverige AB concerning the sale of trade receivables. The agreement decreased the company's trade receivables by a total of EUR 16.7 million at the end of the review period.
In January 2011, Atria Plc made a decision to invest approximately EUR 26 million in building and renovation work on the Kauhajoki bovine slaughterhouse and cutting plant. Atria Plc also bought the shares of Kauhajoen Teurastamokiinteistöt Oy from Itikka Co-operative. The final purchase price was EUR 6.1 million.
During the first three quarters of the year, Atria Finland launched programmes to increase the efficiency of bovine slaughtering and to improve the Nurmo production plant. The total annual cost savings from these measures will amount to approximately EUR 10 million. The savings will start to materialise during 2011 and will be fully materialised by the beginning of 2013.
Atria Russia began reorganising its production in 2010, and the project is progressing according to plan. Production of meat products will be transferred from the Moscow and Sinyavino plants to the new Gorelovo plant in St Petersburg. Personnel reductions will be bigger than previously reported, and the estimated annual cost savings will amount to approximately EUR 7.5 million. The savings will begin to materialise already during 2011, and they will be fully materialised by the beginning of 2013.
During the review period, Atria Scandinavia continued to enhance its operational efficiency by automating the production process for black pudding. The production of black pudding will be transferred from the Saltsjö-Boo plant in Stockholm to Tranås during the remainder of the year. The efficiency improvement programme is expected to generate an annual cost saving of approximately EUR 1.0 million. The saving will be fully realised as of the beginning of 2012.
The implementation of the product leadership strategy progressed according to plan. The elements emphasised in the product leadership strategy are strengthening the product brands represented by Atria, ensuring the competitiveness of the existing products, and developing new, innovative products.
| Key indicators | |
|---|---|
| -- | ---------------- |
| EUR million | 30.9.11 | 30.9.10 | 31.12.10 |
|---|---|---|---|
| Shareholders' equity per share, EUR | 14.74 | 15.41 | 15.68 |
| Interest-bearing liabilities | 423.5 | 449.2 | 429.9 |
| Equity ratio, % | 39.8 | 40.1 | 40.2 |
| Gearing, % | 101.0 | 102.4 | 96.4 |
| Net gearing, % | 98.9 | 100.7 | 92.2 |
| Gross investments in fixed assets | 36.9 | 34.2 | 46.2 |
| Gross investments of net sales, % | 3.8 | 3.6 | 3.5 |
| Average number of personnel (FTE) | 5,550 | 5,811 | 5,812 |
| Q3 | Q3 | Q1-Q3 | Q1-Q3 | ||
|---|---|---|---|---|---|
| EUR million | 2011 | 2010 | 2011 | 2010 | 2010 |
| Net sales | 197.5 | 195.9 | 586.8 | 553.9 | 767.8 |
| EBIT | 9.0 | 11.9 | 12.2 | 22.9 | 30.7 |
| EBIT % | 4.6 | 6.1 | 2.1 | 4.1 | 4.0 |
Atria Finland's Q1-Q3 net sales increased year-on-year by 5.9 per cent. The net sales for the comparative period were weakened by the industrial action in the food sector in the spring 2010. Net sales for Q3 came to EUR 197.5 million (EUR 195.9 million).
EBIT for the first three quarters weakened significantly on the previous year. During Q3, operating profit development turned positive. The reason for the clear improvement in earnings compared to the previous quarters of the year is tight cost control and stabilisation in the meat market at the end of Q3. Moreover, sales development was positive during Q3.
The international meat market stabilised and the price of meat increased at the end of Q3. In particular, the demand for and supply of pork on global markets has balanced out compared with the first three quarters. It was possible to transfer some of the accrued cost rises to sales prices at the end of the review period. Atria's stock levels were cleared during the first half of the year, and stocks are currently at a good level.
The prices of cereals and feed have remained high despite a reasonably good harvest. For this reason, the cost pressures in domestic meat production remained high. Taking into account all types of meat, the producer prices that Atria Finland paid in the first three quarters were 7 per cent higher on average than in the same period in the previous year.
According to Atria's estimate, the value of the entire market has increased by about 3.5 per cent since the start of the year. Atria strengthened its position during Q3 compared to the previous quarters. The market share of Atria products in Q3 was approximately 25 per cent measured in value. Atria launched a new product family, Atria Bravuuri, during the period. The products have sold well and new products will join the range at the beginning of next year.
The Kauhajoki bovine slaughterhouse investment is progressing according to the original schedule. The extension to the bovine slaughterhouse will provide an additional 5,000 square metres of space, with nearly the same size of space to be renovated in the old building. With the extension and the slaughtering line renovation, the slaughtering capacity at Kauhajoki will increase from the current 26 million kilos per year to nearly 40 million kilos per year. As part of the investment, Atria also bought the shares of Kauhajoen Teurastamokiinteistöt Oy from Itikka Co-operative. The final purchase price was EUR 6.1 million.
Atria made a decision to invest EUR 6 million in an extension and equipment for its chicken hatchery located at Seinäjoki. Sales of fresh domestic Atria chicken products have been increasing for several years. This investment will ensure future growth potential and better delivering ability during demand peaks.
During the first three quarters of the year, Atria Finland launched programmes to increase the efficiency of bovine slaughtering and to improve the Nurmo production plant. The total annual cost savings from these measures will amount to approximately EUR 10 million. The savings will start to materialise during 2011 and will be fully materialised by the beginning of 2013.
The corporate responsibility projects in Atria's Handprint programme progressed according to plan. In autumn 2010, a project leading to improved safety at work was launched as part of the "Early caring" project. This year, an industrial safety system will be taken into use, which includes industrial safety rounds carried out by the management and supervisors, as well as a revised accident investigation procedure. The measures have yielded results and the number of occupational accidents has dropped significantly. In addition, a new occupational health centre will be constructed at the Nurmo plant area. At the health centre, significant investments have been made in preventative rehabilitation facilities. The new health centre will be taken into use at the end of 2011.
An important step forward in animal well-being was made with the introduction of castration pain relief. Atria is the first Finnish operator in the industry that demands that all of its pork producers use pain relief.
| Q3 | Q3 | Q1-Q3 | Q1-Q3 | ||
|---|---|---|---|---|---|
| EUR million | 2011 | 2010 | 2011 | 2010 | 2010 |
| Net sales | 93.5 | 98.9 | 277.1 | 293.6 | 391.6 |
| EBIT | 4.7 | 4.3 | 9.7 | 8.3 | 13.9 |
| EBIT % | 5.0 | 4.4 | 3.5 | 2.8 | 3.5 |
Atria Scandinavia's net sales decreased by 5.6 per cent year-on-year. In local currency, net sales fell by 10.7 per cent. The principal reason for the decline in net sales is the discontinuation of consumer packed meat production in summer 2010. The EBIT for the review period was EUR 9.7 million (EUR 8.3 million). The Q1-Q3/2010 EBIT included EUR 2.3 million of non-recurring costs relating to the shutdown of the Årsta plant.
The retail market for cold cuts and sausages in Sweden has contracted slightly year-on-year. Atria's market share in the Swedish cold cut and cooking sausage market fell a little from last year (source: AC Nielsen). The reason for the loss of market share was Atria's decision to discontinue non-profitable product groups. In accordance with its strategy, Atria has invested in strong product brands in Sweden: Lönneberga cold cuts and the Sibylla fast food concept.
The Danish market for cold cuts has grown by about 1.5 per cent in the last 12 months. Atria has gained some market share in the Danish market for cold cuts. (Source: AC Nielsen)
Atria Scandinavia's development programme progressed as planned during the review period. The Saltsjö-Boo plant will be shut down by the end of 2011 and the production of black pudding will be transferred to the Tranås production plant. The efficiency improvement programme is expected to generate an annual cost saving of approximately EUR 1.0 million. The saving will be fully realised as of the beginning of 2012. This year, Atria has invested in the production and logistics systems at the Tranås production plant.
The projects implemented under Atria's Handprint programme focus on three themes: quality assurance, personnel and environment. A project launched to improve product quality has yielded results and the number of product reclamations has reduced significantly.
| Q3 | Q3 | Q1-Q3 | Q1-Q3 | ||
|---|---|---|---|---|---|
| EUR million | 2011 | 2010 | 2011 | 2010 | 2010 |
| Net sales | 31.0 | 33.7 | 91.8 | 97.0 | 129.2 |
| EBIT | -3.3 | -15.4 | -14.5 | -20.3 | -27.9 |
| EBIT % | -10.7 | -45.6 | -15.8 | -20.9 | -21.6 |
Atria Russia's net sales for the period decreased by 5.4 per cent year-on-year. This was due to a decrease in sales in Moscow. In Q3/2011, the weakened rouble impaired the growth of net sales. In local currency, net sales decreased by 3.0 per cent year-on-year.
Atria Russia's EBIT for the first three quarters showed a loss of EUR -14.5 million. However, this was an improvement on the previous year (EUR -20.3 million). The figure for the comparative period includes a total of EUR 9.1 million of non-recurring costs. The EBIT of EUR -3.3 million for Q3 was better than the previous two quarters (Q1/2011 = EUR -5.6 million and Q2/2011= EUR -5.6 million). The reasons for the improved earnings were enhanced cost efficiency, price rises and a more streamlined product range.
In the first three quarters, economic development in Russia was steady. However, if the uncertainty in the global economy continues, market growth in terms of value will be more uncertain than previously. The weakened rouble increased the prices of imported raw materials at the end of Q3.
According to Atria's own estimate, Atria's market share in the St Petersburg retail trade has remained stable. Atria is the clear market leader in St Petersburg with a share of approximately 20 per cent. In Moscow, Atria's market share is about two per cent.
The performance of Campofarm, a pork farm owned by Atria, was weighed down by continuously high feed costs. The pork farm projects implemented in cooperation with Dan-Invest are progressing according to plan. The first pigs will be slaughtered in early December.
The development programme launched in 2010 to improve profitability and the efficiency of production is progressing according to schedule. Production of meat products will be transferred from the Moscow plant and the Sinyavino plant in St Petersburg to the new Gorelovo plant in St Petersburg. The arrangement enables Atria to increase the productivity of its entire production structure and make maximum use of the efficient process technology at the new Gorelovo facility. Personnel reductions will be bigger than previously reported, and the estimated annual cost savings will amount to approximately EUR 7.5 million. The savings will start to materialise in late 2011, and they will be fully materialised as of the beginning of 2013.
| Q3 | Q3 | Q1-Q3 | Q1-Q3 | ||
|---|---|---|---|---|---|
| EUR million | 2011 | 2010 | 2011 | 2010 | 2010 |
| Net sales | 9.0 | 8.7 | 26.3 | 26.2 | 35.0 |
| EBIT | -0.4 | -0.9 | -0.4 | -3.0 | -3.7 |
| EBIT % | -4.8 | -10.3 | -1.5 | -11.3 | -10.5 |
Atria Baltic's Q1-Q3/2011 net sales were at the same level as in Q1-Q3/2010. The EBIT showed clear improvement on the previous year. The positive development of earnings was due to good cost control and an improved sales structure, as well as non-recurring sales gains. EBIT for the first three quarters of the year includes a total of EUR 0.9 million of non-recurring sales gains. The earnings development of the company's primary production was burdened by cereal and feed prices, which remained high.
According to Atria's own estimate, there was slight growth in the meat product market in Estonia during the summer. However, rising general consumer prices in Estonia may weaken the buying power of consumers in the future.
Atria's market share in the cold cut and cooking sausage market fell a little, particularly in the less expensive product groups (source: Atria's own estimate). New products accounted for a significant proportion of total sales in the summer. The new packaging of consumer packed meat and uncooked sausages was received particularly favourably by the market. In addition, the launch of the additive-free Jussi meat products was successful.
Estonian consumers have also become more concerned about the use of food additives. In the remainder of the year, Atria will focus on relaunching the Maks & Moorits brand and will discontinue the use of monosodium glutamate in all Maks & Moorits products.
At the end of the review period, the value of undrawn committed credit facilities stood at EUR 155.5 million (EUR 59.9 million). The average maturity of loans drawn and committed credit facilities stood at 3 years 3 months (3 years 5 months). Atria Plc concluded two new interest rate swaps, which were used to convert loans in the amount of EUR 50 million drawn in April into fixed-rate ones. At the end of the review period, fixed interest debt accounted for 50 per cent (39%) of the loan portfolio.
The Group's free cash flow (operating cash flow – cash flow from investments) during the review period was EUR -0.6 million (EUR -30.3 million). Net interest-bearing liabilities amounted to EUR 414.7 million, with a growth of EUR 3.3 million since the year-end. The Group's investments during the period totalled EUR 36.9 million (EUR 34.2 million). The equity ratio was at the year-end's level, 39.8 per cent.
Atria Scandinavia concluded an agreement with Nordea Finans Sverige AB concerning the sale of trade receivables. The agreement decreased the company's trade receivables by a total of EUR 16.7 million at the end of the review period.
The Group had an average of 5,550 (5,811) employees during the period. Personnel by business area:
| Atria Finland | 2 148 | (2 093)* |
|---|---|---|
| Atria Scandinavia | 1 147 | (1 214) |
| Atria Russia | 1 854 | (2 025) |
| Atria Baltic | 401 | ( 479) |
*The average number of man-years (the FTE figure) of Atria Finland was weakened by industrial action in the food sector in spring 2010.
Juha Gröhn was appointed Atria Plc's CEO effective as of 18 March 2011 after Matti Tikkakoski left his position at the beginning of March. At the same time, the management group was simplified, both in terms of composition and management model.
As of 1 May 2011, the composition of Atria Plc's management group is as follows:
The members of the management group report to Juha Gröhn, CEO, Atria Plc.
In its organisation meeting following the Annual General Meeting, Atria Plc's Supervisory Board re-elected retiring member of the Board Martti Selin. Ari Pirkola was appointed Chairman of the Supervisory Board and Seppo Paavola as Deputy Chairman of the Supervisory Board. Chairman of the Board Martti Selin and Deputy Chairman of the Board Timo Komulainen were reappointed.
Atria Plc's Board of Directors now has the following membership: Chairman of the Board Martti Selin; Deputy Chairman Timo Komulainen; members Tuomo Heikkilä, Esa Kaarto, Maisa Romanainen and Harri Sivula.
No significant changes have occurred to Atria Group's short-term business risks compared with the risks described in the financial statements of 2010.
The company expects full-year EBIT to be significantly lower than 2010 EBIT excluding non-recurring items (EUR 21.6 million). Net sales are expected to grow somewhat in 2011.
The key source for uncertainty in terms of reaching the growth target in net sales is the weakening of currency exchange rates during the latter part of the year. Tougher competition may also slow down sales growth.
8 (17)
The development of Atria Finland's earnings is significant when evaluating the whole Group's prospects of results. Stabilisation in the meat market and increasing meat prices improve Atria Finland's outlook for the remainder of the year. The price development for raw materials in other business areas will also be a significant factor for the Group's performance in the latter part of the year.
The meat raw material market will continue to stabilise during the remainder of the year. However, there is still pressure to raise meat raw material prices due to high feed and energy costs. Consequently, the wholesale and export prices of meat can be expected to rise during the remainder of the year.
In the first three quarters, the economic development in Russia was steady. However, if the uncertainty in the global economy continues, market growth in terms of value will be more uncertain than previously.
Atria has initiated profitability improvement measures in various business areas in 2010 and 2011. These measures will generate annual cost savings totalling EUR 18.5 million. The savings will begin to materialise during 2011 and will be fully materialised by 2013.
Atria Plc received a notification from ODIN Forvaltning AS of a change in the company's holding. The total holding of ODIN Forvaltning AS in Atria Plc fell below the five (5) per cent limit with a share transfer completed on 24 May 2011. According to the notification from ODIN Forvaltning AS, the holdings in the company are as follows.
The total holding of ODIN Forvaltning AS:
Full name and business ID of the shareholders: ODIN Forvaltning AS, business ID 957486657
Atria Plc's share capital comprises a total of 28,267,728 shares, of which 19,063,747 are A-series shares and 9,203,981 are KII-series shares. Each A-series share entitles the holder to one (1) vote and each KIIseries share entitles the holder to ten (10) votes, which means that the total number of votes carried by all of Atria Plc's shares is 111,103,557.
The financial statements and consolidated financial statements for 2010 were approved at the Annual General Meeting and the members of the Supervisory Board, the Board of Directors and the President and CEO were discharged from liability for 2010.
A dividend of EUR 0.25 to be paid for each share for the 2010 financial year was approved at the Annual General Meeting. Dividends were paid to shareholders who were entered on the record date for the payment of dividends in the Company's shareholder register kept by Euroclear Finland Oy. The record date for the payment of dividends was 4 May 2011 and the date of payment was 11 May 2011.
PricewaterhouseCoopers Oy, a firm of Chartered Public Accountants, was elected as the company's auditor until the closing of the next Annual General Meeting. The audit firm has notified that the auditor with the principal responsibility will be Authorised Public Accountant Juha Wahlroos.
The following composition for the Supervisory Board was decided upon at the Annual General Meeting:
| Member | Term ends |
|---|---|
| Juha-Matti Alaranta | 2012 |
| Juho Anttikoski | 2013 |
|---|---|
| Mika Asunmaa | 2013 |
| Lassi-Antti Haarala | 2012 |
| Juhani Herrala | 2013 |
| Henrik Holm | 2012 |
| Veli Hyttinen | 2014 |
| Pasi Ingalsuo | 2014 |
| Juha Kiviniemi | 2014 |
| Teuvo Mutanen | 2014 |
| Mika Niku | 2012 |
| Seppo Paavola | 2012 |
| Heikki Panula | 2013 |
| Pekka Parikka | 2014 |
| Juha Partanen | 2013 |
| Ari Pirkola | 2013 |
| Juho Tervonen | 2012 |
| Tomi Toivanen | 2012 |
| Timo Tuhkasaari | 2014 |
There are a total of 19 members.
A decision was made at the Annual General Meeting to retain the current meeting fees for members of the Supervisory Board. The fees are EUR 250 per meeting, with compensation for loss of working time of EUR 250 per meeting and proceeding day. The fee payable to the Chairman of the Supervisory Board is EUR 3,000 per month and the fee payable to the Deputy Chairman is EUR 1,500 per month.
On 31 December 2010, the parent company's distributable profit stood at EUR 84.1 million. No significant changes have occurred in the company's financial position since the end of the accounting period. In accordance with the decision made at the Annual General Meeting, the company distributed a dividend of EUR 0.25 per share for 2010, a total of EUR 7 million.
The Annual General Meeting authorised the Board of Directors to decide, on one or several occasions, to issue a maximum of 12,800,000 new A-series shares or to sell any A-series shares held by the company through a share issue and/or by granting option rights or other special rights entitling people to shares as referred to in Chapter 10, Section 1 of the Companies Act. The authorisation is intended to be used for the financing or execution of any acquisitions or other arrangements or investments relating to the company's business, for the implementation of the company's incentive programme or for other purposes subject to the Board's decision.
The Board 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 Companies Act. The authorisation thus also includes the right to issue shares in deviation from the proportion of the shares 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 Companies Act regarding the maximum number of treasury shares to be held by a company.
The Annual General Meeting authorised the Board of Directors to decide, on one or several occasions, to acquire a maximum of 2,800,000 of the Company's own A-series 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. The Company's own A-series shares may be acquired for use as consideration in any acquisitions or other arrangements relating to the Company's business, to finance 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.
The 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 market price of the moment of acquisition. The shares shall be acquired and paid for in accordance with the rules of NASDAQ OMX Helsinki Ltd and Euroclear Finland Oy.
The Board of Directors was authorised to decide on the acquisition of the company's own shares in all other respects. The authorisation shall supersede the authorisation granted by the Annual General Meeting on 29 April 2010 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 2012, whichever is first.
This interim report has been prepared in accordance with the IAS 34 Interim Financial Reporting standard. Atria has applied the same principles in preparing this interim report as in preparing the 2010 annual financial statements. However, as of 1 January 2011, the Group has adopted new or revised standards and IFRIC interpretations published by the IASB, included in the accounting principles of the annual financial statements of 2010: these new or revised standards or interpretations did not have any impact on the figures presented for the review period.
The principles and formulae for the calculation of key indicators have not changed, and they are presented in the 2010 annual financial statements. The figures given in the interim report are presented in units of 1,000,000 euros, so the combined total of individual figures may differ from the total sum presented. The figures given in the interim report are unaudited.
| CONSOLIDATED INCOME STATEMENT | |||||
|---|---|---|---|---|---|
| EUR million | 7-9/11 | 7-9/10 | 1-9/11 | 1-9/10 | 1-12/10 |
| Net sales | 325,5 | 331,3 | 963,1 | 954,2 | 1 300,9 |
| Cost of goods sold | -288,3 | -290,0 | -862,1 | -840,8 | -1 149,1 |
| Gross profit | 37,2 | 41,3 | 101,0 | 113,4 | 151,8 |
| Sales and marketing costs | -20,6 | -21,6 | -67,0 | -61,9 | -84,5 |
| Administration costs | -8,4 | -11,0 | -32,4 | -35,7 | -47,3 |
| Other operating income | 1,4 | 4,1 | 5,0 | 6,3 | 7,7 |
| Other operating expenses | -0,7 | -13,2 | -2,7 | -16,8 | -17,9 |
| EBIT | 9,0 | -0,4 | 3,8 | 5,3 | 9,8 |
| Finance income and costs | -3,8 | -2,9 | -10,3 | -7,9 | -11,2 |
| Income from joint-ventures and associates | 0,2 | 0,3 | 1,0 | 1,3 | 1,7 |
| Profit before tax | 5,4 | -3,0 | -5,5 | -1,3 | 0,3 |
| Income taxes | -1,6 | -2,8 | -0,4 | -3,1 | -4,5 |
| Profit for the period | 3,9 | -5,8 | -5,9 | -4,4 | -4,2 |
| Profit attributable to: | |||||
| Owners of the parent | 3,7 | -6,3 | -6,0 | -5,4 | -5,0 |
| Non-controlling interests | 0,2 | 0,5 | 0,1 | 1,0 | 0,8 |
| Total | 3,9 | -5,8 | -5,9 | -4,4 | -4,2 |
| Basic earnings/share, EUR | 0,13 | -0,22 | -0,21 | -0,19 | -0,18 |
| Diluted earnings/share, EUR | 0,13 | -0,22 | -0,21 | -0,19 | -0,18 |
| EUR million | 7-9/11 | 7-9/10 | 1-9/11 | 1-9/10 | 1-12/10 |
|---|---|---|---|---|---|
| Profit for the period | 3,9 | -5,8 | -5,9 | -4,4 | -4,2 |
| Other comprehensive income after tax: | |||||
| Cash flow hedging | -2,7 | 0,4 | -4,0 | 0,4 | 3,2 |
| Net investment hedging | 0,3 | ||||
| Translation differences | -9,0 | -7,9 | -9,6 | 12,8 | 16,9 |
| Total comprehensive income for the period | -7,8 | -13,3 | -19,5 | 8,8 | 16,2 |
| Total comprehensive income attributable to: | |||||
| Owners of the parent | -8,0 | -14,0 | -19,6 | 7,6 | 15,3 |
| Non-controlling interests | 0,1 | 0,7 | 0,1 | 1,2 | 0,9 |
| Total | -7,8 | -13,3 | -19,5 | 8,8 | 16,2 |
| Assets | |||
|---|---|---|---|
| EUR million | 30.9.11 | 30.9.10 | 31.12.10 |
| Non-current assets | |||
| Property, plant and equipment | 458,2 | 469,6 | 470,1 |
| Biological assets | 1,3 | 1,8 | 1,9 |
| Goodwill | 158,8 | 160,4 | 162,9 |
| Other intangible assets | 72,0 | 74,2 | 75,5 |
| Investments in joint ventures and associates | 13,3 | 10,8 | 11,9 |
| Other financial assets | 1,6 | 2,3 | 1,6 |
| Loans and other receivables | 16,9 | 16,7 | 20,2 |
| Deferred tax assets | 13,8 | 10,1 | 11,5 |
| Total | 735,9 | 745,9 | 755,5 |
| Current assets | |||
| Inventories | 104,3 | 112,9 | 105,3 |
| Biological assets | 5,4 | 5,7 | 5,8 |
| Trade and other receivables | 190,4 | 214,1 | 217,3 |
| Cash and cash equivalents | 8,9 | 7,5 | 18,5 |
| Total | 309,0 | 340,2 | 346,9 |
| Non-current assets held for sale | 9,1 | 9,1 | 9,2 |
| Total assets | 1 053,9 | 1 095,2 | 1 111,6 |
| Equity and liabilities | |||
| EUR million | 30.9.11 | 30.9.10 | 31.12.10 |
| Equity belonging to the shareholders | |||
| of the parent company | 416,6 | 435,6 | 443,2 |
| Non-controlling interest | 2,9 | 3,0 | 2,9 |
| Total equity | 419,5 | 438,6 | 446,0 |
| Non-current liabilities | |||
| Interest-bearing financial liabilities | 307,4 | 330,2 | 302,8 |
| Deferred tax liabilities | 47,6 | 43,8 | 46,8 |
| Other non-interest-bearing liabilities | 2,8 | 2,9 | 0,8 |
| Provisions | 0,3 | 0,0 | 0,8 |
| Total | 358,1 | 376,9 | 351,2 |
| Current liabilities | |||
| Interest-bearing financial liabilities | 116,1 | 119,0 | 127,2 |
| Trade and other payables | 160,2 | 160,7 | 187,2 |
| Total | 276,3 | 279,7 | 314,4 |
| Total liabilities | 634,4 | 656,6 | 665,6 |
| Total equity and liabilities | 1 053,9 | 1 095,2 | 1 111,6 |
| EUR million | of parent company | Equity belonging to the shareholders | Non- cont |
Total equity |
||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Share ca pit al |
Share pre mium |
Own sha res |
Other reser ves |
Inv. non- rest. equity fund |
Trans lation diff. |
Retain ed earn ings |
Total | roll ing inte rests |
||
| Equity 1.1.10 | 48,1 | 138,5 | -1,3 | -1,7 | 110,6 | -31,0 | 171,9 | 435,1 | 1,8 | 436,9 |
| Periods comprehensive income Profit for the period Other comprehensive |
-5,4 | -5,4 | 1,0 | -4,4 | ||||||
| income Cash flow hedging Translation differences Transactions |
0,4 | 12,6 | 0,4 12,6 |
0,2 | 0,4 12,8 |
|||||
| with owners Distribution of dividends |
-7,1 | -7,1 | -7,1 | |||||||
| Equity 30.9.10 | 48,1 | 138,5 | -1,3 | -1,3 | 110,6 | -18,4 | 159,5 | 435,6 | 3,0 | 438,6 |
| Equity 1.1.11 | 48,1 | 138,5 | -1,3 | 1,8 | 110,6 | -14,3 | 159,8 | 443,2 | 2,9 | 446,0 |
| Periods comprehensive income Profit for the period Other comprehensive |
-6,0 | -6,0 | 0,1 | -5,9 | ||||||
| income Cash flow hedging Translation differences Transactions |
-4,0 | -9,6 | -4,0 -9,6 |
-4,0 -9,6 |
||||||
| with owners Distribution of dividends |
-7,0 | -7,0 | -7,0 | |||||||
| Equity 30.9.11 | 48,1 | 138,5 | -1,3 | -2,2 | 110,6 | -23,9 | 146,8 | 416,6 | 2,9 | 419,5 |
| EUR million | 1-9/11 | 1-9/10 | 1-12/10 |
|---|---|---|---|
| Cash flow from operating activities | |||
| Operating activities | 36,8 | 31,4 | 85,5 |
| Financial items and taxes | -8,2 | -26,9 | -40,9 |
| Net cash flow from operating activities | 28,6 | 4,5 | 44,6 |
| Cash flow from investing activities | |||
| Tangible and intangible assets | -24,0 | -29,7 | -39,6 |
| Disposal of subsidiary | 2,0 | ||
| Acquisition of subsidiary | -6,1 | ||
| Investments | -1,1 | -5,1 | -0,6 |
| Net cash used in investing activities | -29,2 | -34,8 | -40,2 |
| Cash flow from financing activities | |||
| Loans drawn down | 50,0 | 40,8 | 40,8 |
| Loans repaid | -51,7 | -32,2 | -56,2 |
| Dividends paid | -7,0 | -7,1 | -7,0 |
| Net cash used in financing activities | -8,8 | 1,5 | -22,4 |
| Change in liquid funds | -9,4 | -28,8 | -18,0 |
| EUR million | 7-9/11 | 7-9/10 | 1-9/11 | 1-9/10 | 1-12/10 |
|---|---|---|---|---|---|
| Net sales | |||||
| Finland | 197,5 | 195,9 | 586,8 | 553,9 | 767,8 |
| Scandinavia | 93,5 | 98,9 | 277,1 | 293,6 | 391,6 |
| Russia | 31,0 | 33,7 | 91,8 | 97,0 | 129,2 |
| Baltic | 9,0 | 8,7 | 26,3 | 26,2 | 35,0 |
| Eliminations | -5,6 | -5,9 | -18,9 | -16,5 | -22,7 |
| Total | 325,5 | 331,3 | 963,1 | 954,2 | 1 300,9 |
| EBIT | |||||
| Finland | 9,0 | 11,9 | 12,2 | 22,9 | 30,7 |
| Scandinavia | 4,7 | 4,3 | 9,7 | 8,3 | 13,9 |
| Russia | -3,3 | -15,4 | -14,5 | -20,3 | -27,9 |
| Baltic | -0,4 | -0,9 | -0,4 | -3,0 | -3,7 |
| Unallocated * | -0,9 | -0,3 | -3,2 | -2,6 | -3,2 |
| Total | 9,0 | -0,4 | 3,8 | 5,3 | 9,8 |
* 1-9/2011 includes a non-recurring severance pay item of EUR 0.8 million including social expenses relating to the termination of the employment contract with Atria Plc's previous CEO
| ROCE * | |||||
|---|---|---|---|---|---|
| Finland | 5,3 % | 8,6 % | 7,9 % | ||
| Scandinavia | 6,1 % | 4,5 % | 5,3 % | ||
| Russia | -13,6 % | -12,8 % | -16,9 % | ||
| Baltic | -3,1 % | -30,3 % | -9,6 % | ||
| Group | 1,0 % | 1,0 % | 1,1 % | ||
| * ROCE = | |||||
| EBIT, 12mr / Capital employed, 12 mr avg *100 | |||||
| Investments | |||||
| Finland | 6,0 | 2,8 | 24,7 | 9,1 | 13,3 |
| Scandinavia | 2,3 | 1,9 | 6,3 | 6,3 | 9,5 |
| Russia | 2,3 | 2,3 | 5,1 | 18,4 | 22,6 |
| Baltic | 0,3 | 0,1 | 0,8 | 0,4 | 0,8 |
| Total | 10,9 | 7,1 | 36,9 | 34,2 | 46,2 |
| Depreciations | |||||
| Finland | 6,4 | 7,3 | 19,3 | 22,0 | 28,7 |
| Scandinavia | 2,9 | 3,0 | 8,7 | 8,8 | 11,9 |
| Russia | 2,5 | 12,6 | 7,6 | 16,2 | 18,9 |
| Baltic | 0,7 | 0,7 | 2,1 | 2,2 | 3,0 |
| Total | 12,4 | 23,6 | 37,7 | 49,2 | 62,5 |
| EUR million | 30.9.11 | 30.9.10 | 31.12.10 |
|---|---|---|---|
| Debts with mortgages or other collateral given as security Loans from financial institutions Pension fund loans Total |
3,5 5,3 8,8 |
5,8 4,8 10,6 |
5,4 4,9 10,3 |
| Mortgages and other securities given as comprehensive security Real estate mortgages Corporate mortgages Total |
4,6 1,3 5,9 |
6,6 3,9 10,5 |
5,0 4,0 9,0 |
| Guarantee engagements not included in the balance sheet Guarantees |
0,8 | 0,7 | 0,8 |
On 21 June 2011, Atria acquired the entire stock of Kauhajoen Teurastamokiinteistöt Oy from Itikka Cooperative as part of the bovine slaughtering and cutting efficiency improvement programme. Itikka Co-operative is included in the related parties of Atria. Kauhajoen Teurastamokiinteistöt Oy owns the slaughterhouse property and machinery used by Atria in Kauhajoki. The acquisition clarifies the ownership structure.
Atria invests approximately EUR 26 million in renovating the Kauhajoki bovine slaughterhouse and cutting plant. This investment is due to be completed by the end of 2012. The annual cost savings from the entire bovine slaughtering efficiency improvement programme are estimated at EUR 6 million.
| Kauhajoen Teurastamokiinteistöt Oy | Book value | ||||
|---|---|---|---|---|---|
| Fair values | before | ||||
| on | the | ||||
| EUR million | acquisition | acquisition | |||
| Property, plant and equipment | 9,0 | 2,4 | |||
| Intangible assets | 0,1 | 0,1 | |||
| Current receivables | 0,2 | 0,2 | |||
| Total assets | 9,3 | 2,7 | |||
| Non-current interest-bearing liabilities | 1,5 | 1,5 | |||
| Deferred tax liabilities | 1,7 | ||||
| Total liabilities | 3,2 | 1,5 | |||
| Net assets | 6,1 | 1,2 | |||
| Purchase price | 6,1 | ||||
| Effect of acquisition on cash flow | 6,1 |
The accounting for the business combination is incomplete.
| Average rates: | 1-9/11 | 1-9/10 | 1-12/10 |
|---|---|---|---|
| SEK | 9,0018 | 9,6015 | 9,4926 |
| DKK | 7,4536 | 7,4456 | 7,4477 |
| RUR | 40,7731 | 39,7927 | 40,2217 |
| LTL | 3,4528 | 3,4528 | 3,4528 |
| PLN | 4,0383 | 4,0036 | 4,0049 |
| NOK | 7,7958 | 7,9953 | 8,0034 |
| Closing rates: | 30.9.11 | 30.9.10 | 31.12.10 |
| SEK | 9,2580 | 9,1421 | 8,9655 |
| DKK RUR |
7,4417 43,3500 |
7,4519 41,6923 |
7,4535 40,8200 |
| LTL | 3,4528 | 3,4528 | 3,4528 |
| PLN | 4,4050 | 3,9847 | 3,9750 |
For more information, please contact Juha Gröhn, CEO, Atria Plc, tel. +358 400 684 224.
Nasdaq OMX Helsinki Ltd Major media www.atriagroup.com
The interim report will be mailed to you upon request and is also available on our Web site, www.atriagroup.com.
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